Document:

<PAGE>

                                                                    EXHIBIT 4.16

                         ERICO INTERNATIONAL CORPORATION

                                  $121,500,000
                   8 7/8% SENIOR SUBORDINATED NOTES DUE 2012

                               PURCHASE AGREEMENT

                                                               February 12, 2004

DEUTSCHE BANK SECURITIES INC.
J.P. Morgan Securities Inc.
ABN AMRO INCORPORATED
NATCITY INVESTMENTS, INC.
MCDONALD INVESTMENTS INC.

c/o Deutsche Bank Securities Inc.
    60 Wall Street
    New York, New York  10005

Ladies and Gentlemen:

                  ERICO International Corporation, an Ohio corporation (the
"Company"), and the Company's subsidiary listed on the signature pages hereto
(the "Subsidiary Guarantor" and, together with the Company, the "Issuers")
hereby confirm their agreement with you (the "Initial Purchasers"), as set forth
below.

                  1.       The Securities. Subject to the terms and conditions
herein contained, the Company proposes to issue and sell to the Initial
Purchasers $121,500,000 aggregate principal amount of its 8 7/8% Senior
Subordinated Notes due 2012, Series A (the "Notes"). The Notes will be
guaranteed (the "Guarantee") on a senior subordinated basis by the Guarantor.
The Notes and the Guarantee are collectively referred to herein as the
"Securities." The Securities are to be issued under an indenture (the
"Indenture") to be dated as of February 20, 2004 by and among the Company, the
Guarantor and Wells Fargo Bank, N.A., as Trustee (the "Trustee").

                  The Notes will be offered and sold to the Initial Purchasers
without being registered under the Securities Act of 1933, as amended (the
"Act"), in reliance on exemptions therefrom; provided that the representations
and warranties of the Initial Purchasers contained in Section 8 hereof are true,
accurate and complete and the offer and sale of the Securities is conducted in
the manner set forth in the Final Memorandum.

                  In connection with the sale of the Securities, the Issuers
have prepared a preliminary offering memorandum dated February 2, 2004 (the
"Preliminary Memorandum") and a final offering memorandum dated February 12,
2004 (the "Final Memorandum"; the Preliminary Memorandum and the Final
Memorandum each herein being referred to as a "Memorandum")

<PAGE>

setting forth or including, among other things, a description of the terms of
the Securities, the terms of the offering of the Securities, and a description
of the Company and the Guarantor.

                  In connection with the offering of the Securities, the
Company, the Guarantor and certain other Subsidiaries (as defined below),
LaSalle Bank N.A., as agent and the lenders thereunder will enter into an
amendment to the Company's existing revolving credit agreement (the "Credit
Agreement"). Concurrently with the offering of the Securities, the Company will
sell (the "CVC Sale") $19,400,000 aggregate principal amount of its 8% Senior
Subordinated Notes due 2012, Series A (the "CVC Notes"), issued under the
Indenture, to CVC Capital Funding, LLC.

                  The Initial Purchasers and their direct and indirect
transferees of the Securities will be entitled to the benefits of the
Registration Rights Agreement to be dated as of the Closing Date (as defined in
Section 3 below) (the "Registration Rights Agreement"), pursuant to which the
Issuers will agree, among other things, to file with the Securities and Exchange
Commission (the "Commission"), under the circumstances set forth therein, (i) a
registration statement under the Act (the "Exchange Offer Registration
Statement") relating to the notes (the "Exchange Notes," which term includes the
related guarantee of the Subsidiary Guarantor) to be offered in exchange (the
"Exchange Offer") for the Notes and (ii) as and to the extent required by the
Registration Rights Agreement, to file with the Commission a shelf registration
statement pursuant to Rule 415 under the Act (the "Shelf Registration Statement"
and, together with the Exchange Offer Registration Statement, the "Registration
Statements") relating to the resale by certain holders of the Notes, and to use
their best efforts to cause such Registration Statements to be declared
effective in accordance with the provisions of the Registration Rights
Agreement. This Purchase Agreement (this "Agreement"), the Notes, the Guarantee,
the Exchange Notes and related guarantee, the Private Exchange Notes (as defined
in the Registration Rights Agreement) and related guarantee, the Indenture and
the Registration Rights Agreement are hereinafter referred to collectively as
the "Operative Documents."

                  2.       Representations and Warranties. The Company
represents and warrants to and agrees with each of the Initial Purchasers as
follows:

                  (a)      Neither the Preliminary Memorandum as of the date
         thereof nor the Final Memorandum nor any amendment or supplement
         thereto as of the date thereof and at the Closing Date (as defined in
         Section 3 below) (it being understood that references to the Final
         Memorandum herein, to the extent deemed made after the date of the
         Final Memorandum, are to the Final Memorandum, as supplemented as of
         the date of such reference, only) contained or will contain any untrue
         statement of a material fact or omitted or omits to state a material
         fact necessary to make the statements therein, in the light of the
         circumstances under which they were made, not misleading, except that
         the representations and warranties set forth in this Section 2(a) do
         not apply to statements or omissions made in reliance upon and in
         conformity with information relating to either of the Initial
         Purchasers furnished to the Company in writing by the Initial
         Purchasers expressly for use in the Preliminary Memorandum, the Final
         Memorandum or any amendment or supplement thereto.

                                      -2-

<PAGE>

                  (b)      All of the subsidiaries of the Company are listed in
         Schedule 2 attached hereto (each, a "Subsidiary" and collectively, the
         "Subsidiaries"); all of the outstanding shares of capital stock of the
         Company and the Subsidiaries have been, and as of the Closing Date will
         be, duly authorized and validly issued, are fully paid and
         nonassessable and were not issued in violation of any preemptive or
         similar rights; except as set forth in the Final Memorandum, there are
         no (i) options, warrants or other rights to purchase, (ii) agreements
         or other obligations to issue or (iii) other rights to convert any
         obligation into, or exchange any securities for, shares of capital
         stock of or ownership interests in the Company or any of the
         Subsidiaries outstanding. Except for immaterial holdings of less than
         one percent of such other entities that had an aggregate market value
         as of February 11, 2004, of less than $75,000, and for the Subsidiaries
         or as disclosed in the Final Memorandum, the Company does not own,
         directly or indirectly, any shares of capital stock or any other equity
         or long-term debt securities or have any equity interest in any firm,
         partnership, joint venture or other entity.

                  (c)      Each of the Company and the Subsidiaries is duly
         incorporated or otherwise organized, validly existing and in good
         standing under the laws of its respective jurisdiction of organization
         and has all requisite corporate or other organizational power and
         authority to own or lease its properties and conduct its business as
         now conducted and as described in the Final Memorandum; each of the
         Company and the Subsidiaries is duly qualified to do business as a
         foreign corporation or entity in good standing in all other
         jurisdictions where the ownership or leasing of its properties or the
         conduct of its business requires such qualification, except where the
         failure to be so qualified or in good standing could not, individually
         or in the aggregate, reasonably be expected to result in a material
         adverse effect on the business, condition (financial or otherwise), or
         results of operations of the Company and the Subsidiaries, taken as a
         whole, whether or not arising in the ordinary course of business (any
         such event, a "Material Adverse Effect").

                  (d)      The Company has all requisite corporate power and
         authority to execute, deliver and perform each of its obligations under
         the Operative Documents to which it is a party and to consummate the
         transactions contemplated hereby and thereby, including, without
         limitation, the power and authority to issue, sell and deliver the
         Securities as contemplated by this Agreement. The Notes, when issued,
         will be in the form contemplated by the Indenture. The Notes, the
         Exchange Notes and the Private Exchange Notes have each been duly
         authorized by the Company and, when executed by the Company and
         authenticated by the Trustee in accordance with the provisions of the
         Indenture and, in the case of the Notes, when delivered to and paid for
         by the Initial Purchasers in accordance with the terms of this
         Agreement, will constitute valid and binding obligations of the
         Company, entitled to the benefits of the Indenture, and enforceable
         against the Company in accordance with their terms, except that the
         enforcement thereof may be subject to (i) bankruptcy, insolvency,
         reorganization, fraudulent transfer, conveyance, voidable preference,
         moratorium or other similar laws, regulations or judicial opinions of
         general applicability now or hereafter in effect relating to or
         affecting creditors' rights and remedies generally, and (ii) general
         principles of equity (whether such principals are consid-

                                      -3-

<PAGE>

         ered in a proceeding at law or equity) and the discretion of the court
         before which any proceeding therefor may be brought.

                  (e)      The Guarantor has all requisite corporate power and
         authority to execute, deliver and perform each of its obligations under
         the Operative Documents to which it is a party and to consummate the
         transactions contemplated hereby and thereby, including, without
         limitation, the power and authority to issue, sell and deliver the
         Guarantee as contemplated by this Agreement. The Guarantee, when
         issued, will be in the form contemplated by the Indenture. The
         Guarantee and the guarantees of the Exchange Notes and the Private
         Exchange Notes have each been duly authorized by the Guarantor and,
         when executed by the Guarantor and authenticated by the Trustee in
         accordance with the provisions of the Indenture and, in the case of the
         Guarantee, when delivered to and paid for by the Initial Purchasers in
         accordance with the terms of this Agreement, will constitute valid and
         binding obligations of the Guarantor, entitled to the benefits of the
         Indenture, and enforceable against the Guarantor in accordance with
         their terms, except that the enforcement thereof may be subject to (i)
         bankruptcy, insolvency, reorganization, fraudulent transfer,
         conveyance, voidable preference, moratorium or other similar laws,
         regulations or judicial opinions of general applicability now or
         hereafter in effect relating to or affecting creditors' rights and
         remedies generally, and (ii) general principles of equity (whether such
         principals are considered in a proceeding at law or equity) and the
         discretion of the court before which any proceeding therefor may be
         brought.

                  (f)      The Issuers have all requisite corporate power and
         authority to execute, deliver and perform their obligations under the
         Indenture. The Indenture meets the requirements for qualification under
         the Trust Indenture Act of 1939, as amended (the "TIA"). The Indenture
         has been duly authorized by the Issuers and, when executed and
         delivered by the Issuers (assuming the due authorization, execution and
         delivery by the Trustee), will constitute a valid and binding agreement
         of the Issuers, enforceable against the Issuers in accordance with its
         terms, except that the enforcement thereof may be subject to (i)
         bankruptcy, insolvency, reorganization, fraudulent transfer,
         conveyance, voidable preference, moratorium or other similar laws,
         regulations or judicial opinions of general applicability now or
         hereafter in effect relating to or affecting creditors' rights and
         remedies generally, and (ii) general principles of equity (whether such
         principals are considered in a proceeding at law or equity) and the
         discretion of the court before which any proceeding therefor may be
         brought.

                  (g)      The Issuers have all requisite corporate power and
         authority to execute, deliver and perform their obligations under the
         Registration Rights Agreement. The Registration Rights Agreement has
         been duly authorized by the Issuers and, when executed and delivered by
         the Issuers (assuming the due authorization, execution and delivery by
         the Initial Purchasers), will constitute a valid and binding agreement
         of the Issuers, enforceable against the Issuers in accordance with its
         terms, except that (A) the enforcement thereof may be subject to (i)
         bankruptcy, insolvency, reorganization, fraudulent transfer,
         conveyance, voidable preference, moratorium or other similar laws,
         regulations or judicial opinions of general applicability now or
         hereafter in effect relating to or af-

                                      -4-

<PAGE>

         fecting creditors' rights and remedies generally, and (ii) general
         principles of equity (whether such principals are considered in a
         proceeding at law or equity) and the discretion of the court before
         which any proceeding therefor may be brought and (B) any rights to
         indemnity or contribution thereunder may be limited by federal and
         state securities laws and public policy considerations.

                  (h)      The Issuers have all requisite corporate power and
         authority to execute, deliver and perform their obligations under this
         Agreement and to consummate the transactions contemplated hereby. This
         Agreement and the consummation by the Issuers of the transactions
         contemplated hereby have been duly authorized by the Issuers. This
         Agreement has been duly executed and delivered by the Issuers.

                  (i)      The Credit Agreement, substantially in the form most
         recently delivered to the Initial Purchasers prior to the date of this
         Agreement, has been duly authorized by the Company, the Guarantor and
         the other Subsidiaries party thereto and, when duly executed and
         delivered by the Company, the Guarantor and the other Subsidiaries
         party thereto, will be the valid and binding obligation of the Company,
         the Guarantors and other Subsidiaries party thereto, enforceable
         against each of them in accordance with its terms, except that the
         enforcement thereof may be subject to (i) bankruptcy, insolvency,
         reorganization, moratorium or other similar laws now or hereafter in
         effect relating to creditors' rights generally, and (ii) general
         principles of equity and the discretion of the court before which any
         proceeding therefor may be brought.

                  (j)      No consent, approval, authorization or order of any
         court or governmental agency or body, or third party is required for
         (i) the issuance and sale by the Company of the Notes to the Initial
         Purchasers or the consummation by the Company of the other transactions
         contemplated hereby or by any of the other Operative Documents or (ii)
         the issuance by the Guarantor of the Guarantee or the consummation by
         the Guarantor of the other transactions contemplated hereby or by any
         of the Operative Documents, except with respect to both (i) and (ii)
         (a) such as may be required under state securities or "Blue Sky" laws
         in connection with the purchase and resale of the Notes and Guarantee
         by the Initial Purchasers in the manner contemplated herein and in the
         Final Memorandum and in the Registration Rights Agreement, (b) with
         respect to the registration of the Notes or Exchange Notes under the
         Act pursuant to the Registration Rights Agreement (including any order
         by the Commission declaring any Registration Statement under the
         Registration Rights Agreement effective), (c) the qualification of the
         Indenture under the Trust Indenture Act of 1939, as amended (the "TIA")
         and (d) for the failure to receive any consent, approval, authorization
         or order, which failure could not, individually or in the aggregate,
         reasonably be expected to result in a Material Adverse Effect. None of
         the Company or the Guarantor is (i) in violation of its certificate of
         incorporation or bylaws (or similar organizational document), (ii) in
         breach or violation of any statute, judgment, decree, order, rule or
         regulation applicable to any of them or any of their respective
         properties or assets, except for any such breach or violation that
         would not, individually or in the aggregate, have a Material Adverse
         Effect, or (iii) in breach of or default under (nor has any event
         occurred that, with notice or passage of time or both, would constitute
         a de-

                                      -5-

<PAGE>

         fault under) or in violation of any of the terms or provisions of any
         indenture, mortgage, deed of trust, loan agreement, note, lease,
         license, franchise agreement, permit, certificate, contract or other
         agreement or instrument to which any of them is a party or to which any
         of them or their respective properties or assets is subject
         (collectively, "Contracts"), except for any such breach, default,
         violation or event that would not, individually or in the aggregate,
         have a Material Adverse Effect.

                  (k)      The execution, delivery and performance by each of
         the Issuers of this Agreement and each of the other Operative Documents
         (to the extent such Issuer is a party thereto) and the consummation by
         each of the Issuers of the transactions contemplated hereby and thereby
         (including, without limitation, the issuance and sale of the Securities
         to the Initial Purchasers and the issuance of the Exchange Notes or
         Private Exchange Notes in the Exchange Offer or the Private Exchange,
         as the case may be) will not conflict with or constitute or result in a
         breach of or a default under (or an event that with notice or passage
         of time or both would constitute a default under) or violation of any
         of (i) the terms or provisions of any Contracts, except for any such
         conflict, breach, default, violation or event that could not,
         individually or in the aggregate, reasonably be expected to result in a
         Material Adverse Effect, (ii) the articles of incorporation or code of
         regulations (or similar organizational document) of the Company or any
         of the Subsidiaries or (iii) (assuming compliance with all applicable
         state securities or "Blue Sky" laws and assuming the accuracy of the
         representations and warranties of the Initial Purchasers in Section 8
         hereof) any statute, judgment, decree, order, rule or regulation
         applicable to the Company or any of the Subsidiaries or any of their
         respective properties or assets, except for any such conflict, breach
         or violation that could not, individually or in the aggregate,
         reasonably be expected to result in a Material Adverse Effect.

                  (l)      The audited consolidated financial statements of
         ERICO Global Company included in the Final Memorandum present fairly in
         all material respects the financial position, results of operations and
         cash flows of ERICO Global Company at the dates and for the periods to
         which they relate and have been prepared in accordance with generally
         accepted accounting principles applied on a consistent basis, except as
         otherwise stated therein. The summary and selected financial and
         statistical data in the Final Memorandum present fairly in all material
         respects the information shown therein and have been prepared and
         compiled on a basis consistent with the audited financial statements
         included therein, except as otherwise stated therein. Ernst & Young LLP
         (the "Independent Accountants") is an independent public accounting
         firm within the meaning of the Act and the rules and regulations
         promulgated thereunder.

                  (m)      Except as set forth in the Final Memorandum, there is
         not pending or, to the knowledge of the Company or the Guarantor,
         threatened any action, suit, proceeding, inquiry or investigation to
         which the Company or any of the Subsidiaries is a party, or to which
         the property or assets of the Company or any of the Subsidiaries are
         subject, before or brought by any court, arbitrator or governmental
         agency or body that, if determined adversely to the Company or any of
         the Subsidiaries, could, individually or in the aggregate, reasonably
         be expected to result in a Material Adverse Effect or that seeks to
         re-

                                      -6-

<PAGE>

         strain, enjoin, prevent the consummation of or otherwise challenge the
         issuance or sale of the Securities to be sold hereunder or the
         consummation of the transactions described in the Final Memorandum.

                  (n)      Each of the Company and the Subsidiaries possesses
         all licenses, permits, certificates, consents, orders, approvals and
         other authorizations from, and has made all declarations and filings
         with, all federal, state, local and other governmental authorities, and
         all courts and other tribunals, presently required or necessary to own
         or lease, as the case may be, and to operate its respective properties
         and to carry on its respective businesses as now or proposed to be
         conducted as set forth in the Final Memorandum ("Permits"), except
         where the failure to possess such Permits could not reasonably be
         expected, individually or in the aggregate, to result in a Material
         Adverse Effect; each of the Company and the Subsidiaries has fulfilled
         and performed all of its obligations with respect to such Permits and
         no event has occurred that allows, or after notice or lapse of time
         would allow, revocation, termination or termination thereof or results
         in any other material impairment of the rights of the holder of any
         such Permit and none of the Company or the Subsidiaries has received
         any notice of any proceeding relating to revocation or modification of
         any such Permit, except as described in the Final Memorandum and except
         where such failure to perform, revocation or modification could not,
         individually or in the aggregate, reasonably be expected to result in a
         Material Adverse Effect.

                  (o)      Since the date of the most recent historical
         financial statements appearing in the Final Memorandum, except as
         described therein or contemplated thereby (including the $25.0 million
         dividend described therein), (i) none of the Company or the
         Subsidiaries has incurred any liabilities or obligations, direct or
         contingent, or entered into or agreed to enter into any transactions or
         contracts (written or oral) not in the ordinary course of business,
         which liabilities, obligations, transactions or contracts would,
         individually or in the aggregate, be material to the business,
         condition (financial or otherwise), or results of operations of the
         Company and its Subsidiaries, taken as a whole, (ii) none of the
         Company or the Subsidiaries has purchased any of its outstanding
         capital stock, nor declared, paid or otherwise made any dividend or
         distribution of any kind on its capital stock (other than with respect
         to any of such Subsidiaries, the purchase of, or dividend or
         distribution on, capital stock owned by the Company); (iii) there shall
         not have been any material change in the capital stock or long-term
         indebtedness of the Company or the Subsidiaries; and (iv) there has not
         been any material adverse change, or any development involving a
         prospective material adverse change, in or affecting the financial
         position, stockholders' equity or results of operations of the Company
         and its subsidiaries, otherwise than as set forth in the Offering
         Memorandum..

                  (p)      Each of the Company and the Subsidiaries has filed
         all necessary federal, state and foreign income and franchise tax
         returns, except where the failure to so file such returns could not
         reasonably be expected to result in a Material Adverse Effect, and has
         paid all taxes shown as due thereon, other than taxes that the Company
         or any Subsidiary is contesting in good faith and for which the Company
         or such Subsidiary has provided adequate reserves, to the knowledge of
         the Company and the subsidiaries, no tax defi-

                                      -7-

<PAGE>

         ciency has been asserted against the Company or any of the Subsidiaries
         that could reasonably be expected to result in a Material Adverse
         Effect.

                  (q)      The statistical and market-related data included in
         the Final Memorandum are based on or derived from sources that the
         Company and the Subsidiaries believe to be reliable and accurate or
         represent the Company's good faith estimates that are made on the basis
         of data derived from such sources.

                  (r)      None of the Company, the Subsidiaries or any agent
         acting on their behalf has taken or will take any action that might
         cause this Agreement or the sale of the Securities to violate
         Regulation T, U or X of the Board of Governors of the Federal Reserve
         System, in each case as in effect, or as the same may hereafter be in
         effect, on the Closing Date.

                  (s)      Each of the Company and the Subsidiaries has good and
         marketable title to all real property and rights in all personal
         property described in the Final Memorandum as being owned by it and
         good and marketable title to a leasehold estate in the real property
         described in the Final Memorandum as being leased by it free and clear
         of all liens, charges, encumbrances or restrictions, except (i) for
         liens, charges, encumbrances or restrictions under the Company's
         existing and amended senior credit facilities as described in the Final
         Memorandum, (ii) as would be permitted by the Indenture, (iii) as
         described in the Final Memorandum or (iv) to the extent the failure to
         have such title or rights or the existence of such liens, charges,
         encumbrances or restrictions could not reasonably be expected to result
         in, individually or in the aggregate, a Material Adverse Effect. The
         Company and the Subsidiaries own or possess adequate licenses or other
         rights to use all patents, trademarks, service marks, trade names,
         copyrights and know-how necessary to conduct the businesses now or
         proposed to be operated by them as described in the Final Memorandum,
         and none of the Company or the Subsidiaries has received any notice of
         infringement of or conflict with (or knows of any such infringement of
         or conflict with) asserted rights of others with respect to any
         patents, trademarks, service marks, trade names, copyrights or know-how
         that, if such assertion of infringement or conflict were sustained,
         could reasonably be expected to result in a Material Adverse Effect.

                  (t)      There are no legal or governmental proceedings
         involving or affecting the Company or any Subsidiary or any of their
         respective properties or assets that would be required to be described
         in a prospectus pursuant to the Act that are not described in the Final
         Memorandum.

                  (u)      Except as could not reasonably be expected to result
         in, individually or in the aggregate, a Material Adverse Effect (A)
         each of the Company and the Subsidiaries is in compliance with and not
         subject to liability under applicable Environmental Laws (as defined
         below), (B) each of the Company and the Subsidiaries has made all
         filings and provided all notices required under any applicable
         Environmental Law, and has and is in compliance with all Permits
         required under any applicable Environmental Laws and each of them is in
         full force and effect, (C) except as described in the Final Memorandum,
         there is no unresolved civil, criminal or administrative action, suit,
         demand, claim, hear-

                                      -8-

<PAGE>

         ing, notice of violation, investigation, proceeding, notice or demand
         letter or request for information pending or, to the knowledge of the
         Company or any of the Subsidiaries, threatened against the Company or
         any of the Subsidiaries under any Environmental Law, (D) no lien,
         charge, encumbrance or restriction (which would limit industrial or
         present uses) has been recorded under any Environmental Law with
         respect to any assets, facility or property owned, operated, leased or
         controlled by the Company or any of the Subsidiaries, (E) none of the
         Company or the Subsidiaries has received notice that it has been
         identified as a potentially responsible party under the Comprehensive
         Environmental Response, Compensation and Liability Act of 1980, as
         amended ("CERCLA"), or any comparable state law and (F) no property or
         facility of the Company or any of the Subsidiaries is (i) listed or
         proposed for listing on the National Priorities List under CERCLA or
         (ii) listed in the Comprehensive Environmental Response, Compensation,
         Liability Information System List promulgated pursuant to CERCLA, or on
         any comparable list maintained by any state or local governmental
         authority.

                  For purposes of this Agreement, "Environmental Laws" means the
         common law and all applicable federal, state and local laws or
         regulations, codes, orders, decrees, judgments or injunctions issued,
         promulgated, approved or entered thereunder, relating to pollution or
         protection of public or employee health and safety or the environment,
         including, without limitation, laws relating to (i) emissions,
         discharges, releases or threatened releases of hazardous materials into
         the environment (including, without limitation, ambient air, surface
         water, groundwater, land surface or subsurface strata), (ii) the
         manufacture, processing, distribution, use, generation, treatment,
         storage, disposal, transport or handling of hazardous materials, and
         (iii) underground and aboveground storage tanks and related piping, and
         emissions, discharges, releases or threatened releases therefrom.

                  (v)      There is no strike, labor dispute, slowdown or work
         stoppage with the employees of the Company or any of the Subsidiaries
         that is pending or, to the knowledge of the Company or any of the
         Subsidiaries, threatened that could reasonably be expected to result in
         a Material Adverse Effect.

                  (w)      Each of the Company and the Subsidiaries carries
         insurance in such amounts and covering such risks as it reasonably
         believes is adequate for the conduct of its business and the value of
         its properties.

                  (x)      Except for the $6.3 million liability related to the
         termination of a pension plan as described in the Offering Memorandum,
         none of the Company or the Subsidiaries has any liability for any
         prohibited transaction or funding deficiency or any complete or partial
         withdrawal liability with respect to any pension, profit sharing or
         other plan that is subject to the Employee Retirement Income Security
         Act of 1974, as amended ("ERISA"), to which the Company or any of the
         Subsidiaries makes or ever has made a contribution and in which any
         employee of the Company or of any Subsidiary is or has ever been a
         participant except as could not be reasonably expected to result in a
         Material Adverse Effect. With respect to such plans, the Company and
         each Subsidiary is in compliance in all material respects with all
         applicable provisions of ERISA.

                                      -9-

<PAGE>

                  (y)      Each of the Company and the Subsidiaries (i) makes
         and keeps accurate books and records and (ii) maintains internal
         accounting controls that provide reasonable assurance that (A)
         transactions are executed in accordance with management's
         authorization, (B) transactions are recorded as necessary to permit
         preparation of its financial statements and to maintain accountability
         for its assets, (C) access to its assets is permitted only in
         accordance with management's authorization and (D) the reported
         accountability for its assets is compared with existing assets at
         reasonable intervals.

                  (z)      None of the Company or the Subsidiaries will be an
         "investment company" or "promoter" or "principal underwriter" for an
         "investment company," as such terms are defined in the Investment
         Company Act of 1940, as amended, and the rules and regulations
         thereunder.

                  (aa)     The Notes, the Guarantee, the Indenture, the
         Registration Rights Agreement and this Agreement will conform in all
         material respects to the descriptions thereof in the Final Memorandum.

                  (bb)     No holder of securities of the Company or any
         Subsidiary will be entitled to have such securities registered under
         the registration statements required to be filed by the Company
         pursuant to the Registration Rights Agreement other than as expressly
         permitted thereby.

                  (cc)     Immediately after the consummation of the
         transactions contemplated by this Agreement and the Indenture, the fair
         value and present fair saleable value of the assets of each of the
         Company and the Guarantor (each on a consolidated basis) will exceed
         the sum of its stated liabilities and identified contingent
         liabilities; none of the Company or the Guarantor (each on a
         consolidated basis) is, nor will any of the Company or the Guarantor
         (each on a consolidated basis) be, after giving effect to the
         execution, delivery and performance of this Agreement, and the
         consummation of the transactions contemplated hereby, (a) left with
         unreasonably small capital with which to carry on its business as it is
         proposed to be conducted, (b) unable to pay its debts (contingent or
         otherwise) as they mature or (c) otherwise insolvent.

                  (dd)     None of the Company, the Subsidiaries or any of their
         respective Affiliates (as defined in Rule 501(b) of Regulation D under
         the Act) has directly, or through any agent (other than through the
         Initial Purchasers to which neither the Company nor any of the
         Subsidiaries makes any representation or warranty), (i) sold, offered
         for sale, solicited offers to buy or otherwise negotiated in respect of
         any "security" (as defined in the Act) that is or could be integrated
         with the sale of the Securities in a manner that would require the
         registration under the Act of the Securities or (ii) engaged in any
         form of general solicitation or general advertising (as those terms are
         used in Regulation D under the Act) in connection with the offering of
         the Securities or in any manner involving a public offering within the
         meaning of Section 4(2) of the Act. Assuming the accuracy of the
         representations and warranties of the Initial Purchasers in Section 8
         hereof, it is not necessary in connection with the offer, sale and
         delivery of the Securities to the Initial Pur-

                                      -10-

<PAGE>

         chasers in the manner contemplated by this Agreement to register any of
         the Securities under the Act or to qualify the Indenture under the TIA.

                  (ee)     No securities of the Company or any Subsidiary are of
         the same class (within the meaning of Rule 144A under the Act) as the
         Securities and listed on a national securities exchange registered
         under Section 6 of the Exchange Act, or quoted in a U.S. automated
         inter-dealer quotation system.

                  (ff)     None of the Company or the Subsidiaries has taken,
         nor will any of them take, directly or indirectly (other than through
         the Initial Purchasers to which neither the Company nor any of the
         Subsidiaries makes any representation or warranty), any action designed
         to, or that might be reasonably expected to, cause or result in
         stabilization or manipulation of the price of the Securities.

                  (gg)     None of the Company, the Subsidiaries, any of their
         respective Affiliates or any person acting on its or their behalf
         (other than the Initial Purchasers to which neither the Company nor any
         Subsidiary makes any representation or warranty) has engaged in any
         directed selling efforts (as that term is defined in Regulation S under
         the Act ("Regulation S")) with respect to the Securities; the Company,
         the Subsidiaries and their respective Affiliates and any person acting
         on its or their behalf (other than the Initial Purchasers to which
         neither the Company nor any Subsidiary makes any representation or
         warranty) have complied with the offering restrictions requirement of
         Regulation S.

                  Any certificate signed by any officer of the Company or any
Subsidiary and delivered to any Initial Purchaser or to counsel for the Initial
Purchasers shall be deemed a joint and several representation and warranty by
the Company and each of the Subsidiaries to each Initial Purchaser as to the
matters covered thereby.

                  3.       Purchase, Sale and Delivery of the Notes. On the
basis of the representations, warranties, agreements and covenants herein
contained and subject to the terms and conditions herein set forth, the Company
and the Guarantor agree to issue and sell to the Initial Purchasers, and the
Initial Purchasers, acting severally and not jointly, agree to purchase the
Notes (including the related Guarantee) in the respective amounts set forth on
Schedule 1 hereto from the Company at 97.0% of their principal amount. One or
more certificates in definitive form for the Notes and the Guarantee that the
Initial Purchasers have agreed to purchase hereunder, and in such denomination
or denominations and registered in such name or names as the Initial Purchasers
request upon notice to the Company at least 36 hours prior to the Closing Date,
shall be delivered by or on behalf of the Company to the Initial Purchasers,
against payment by or on behalf of the Initial Purchasers of the purchase price
therefor by wire transfer (same day funds), to such account or accounts as the
Company shall specify prior to the Closing Date, or by such means as the parties
hereto shall agree prior to the Closing Date. Delivery of the Notes shall be
made through the facilities of The Depository Trust Company, or its designated
custodian, unless the Initial Purchasers shall otherwise instruct. Payment for
the Notes shall be made at the offices of Cahill Gordon & Reindel LLP, 80 Pine
Street, New York, New York at 10:00 A.M., New York time, on February 20, 2004,
or at such other place, time or date as the Initial Purchasers, on the

                                      -11-

<PAGE>

one hand, and the Company, on the other hand, may agree upon, such time and date
of delivery against payment being herein referred to as the "Closing Date."

                  4.       Offering by the Initial Purchasers. The Initial
Purchasers propose to make an offering of the Notes at the price and upon the
terms set forth in the Final Memorandum as soon as practicable after this
Agreement is entered into and as in the judgment of the Initial Purchasers is
advisable.

                  5.       Covenants of the Company. The Company covenants and
agrees with each of the Initial Purchasers as follows:

                  (a)      The Company will not amend or supplement the Final
         Memorandum or any amendment or supplement thereto of which the Initial
         Purchasers shall not previously have been advised and furnished a copy
         for a reasonable period of time prior to the proposed amendment or
         supplement and as to which the Initial Purchasers shall not have given
         their consent, which consent shall not be unreasonably withheld. The
         Company will promptly, upon the reasonable request of the Initial
         Purchasers or counsel for the Initial Purchasers, make any amendments
         or supplements to the Preliminary Memorandum or the Final Memorandum
         that may be necessary or advisable in connection with the resale of the
         Securities by the Initial Purchasers.

                  (b)      The Company and the Guarantor will cooperate with the
         Initial Purchasers in arranging for the qualification of the Securities
         for offering and sale under the securities or "Blue Sky" laws of such
         jurisdictions as the Initial Purchasers may designate and will continue
         such qualifications in effect for as long as may be necessary to
         complete the resale of the Notes by the Initial Purchasers; provided,
         however, that in connection therewith, neither the Company nor the
         Guarantor shall be required to qualify as a foreign corporation or to
         execute a general consent to service of process in any jurisdiction or
         subject itself to taxation in excess of $1,000 in any such jurisdiction
         where it is not then so subject.

                  (c)      If, at any time prior to the completion of the
         distribution by the Initial Purchasers of the Notes, the Exchange Notes
         or the Private Exchange Notes, any event occurs or information becomes
         known as a result of which the Final Memorandum as then amended or
         supplemented would include any untrue statement of a material fact, or
         omit to state a material fact necessary to make the statements therein,
         in the light of the circumstances under which they were made, not
         misleading, or if for any other reason it is necessary at any time to
         amend or supplement the Final Memorandum to comply with applicable law,
         the Company and the Guarantor will promptly notify the Initial
         Purchasers thereof and will prepare, at the expense of the Company, an
         amendment or supplement to the Final Memorandum that corrects such
         statement or omission or effects such compliance.

                  (d)      The Company will, without charge, provide to the
         Initial Purchasers and to counsel for the Initial Purchasers as many
         copies of the Preliminary Memorandum and

                                      -12-

<PAGE>

         the Final Memorandum or any amendment or supplement thereto as the
         Initial Purchasers may reasonably request.

                  (e)      The Company will apply the net proceeds from the sale
         of the Notes as set forth under "Use of Proceeds" in the Final
         Memorandum.

                  (f)      For so long as any of the Securities remain
         outstanding, the Company will furnish to the Initial Purchasers copies
         of all reports and other communications (financial or otherwise)
         furnished by the Company to the Trustee or to the holders of the
         Securities and, as soon as available, copies of any reports or
         financial statements furnished to or filed by the Company with the
         Commission or any national securities exchange on which any class of
         securities of the Company may be listed, except to the extent such
         reports or financial statements are available on the Commission's
         website or, if the Company has advised the Initial Purchasers of the
         website where available, otherwise through the Internet free of charge.

                  (g)      Prior to the Closing Date, the Company will furnish
         to the Initial Purchasers at their request, as soon as they have been
         completed, a copy of any unaudited interim financial statements of the
         Company for any period subsequent to the period covered by the most
         recent financial statements appearing in the Final Memorandum.

                  (h)      None of the Issuers or any of their Affiliates will
         sell, offer for sale or solicit offers to buy or otherwise negotiate in
         respect of any "security" (as defined in the Act) that could be
         integrated with the sale of the Securities in a manner which would
         require the registration under the Act of the Securities.

                  (i)      The Issuers will not, and will not permit any of the
         Subsidiaries to, engage in any form of general solicitation or general
         advertising (as those terms are used in Regulation D under the Act) in
         connection with the offering of the Securities or in any manner
         involving a public offering within the meaning of Section 4(2) of the
         Act.

                  (j)      For so long as any of the Securities remain
         outstanding, the Company will make available at its expense, upon
         request, to any holder of such Securities and any prospective
         purchasers thereof the information specified in Rule 144A(d)(4) under
         the Act, unless the Company is then subject to Section 13 or 15(d) of
         the Exchange Act.

                  (k)      The Issuers will use their reasonable best efforts to
         (i) permit the Securities to be designated as PORTAL-eligible
         securities in accordance with the rules and regulations adopted by the
         NASD relating to trading in the NASD's Portal Market (the "Portal
         Market") and (ii) permit the Securities to be eligible for clearance
         and settlement through The Depository Trust Company.

                  (l)      In connection with Securities offered and sold in an
         offshore transaction (as defined in Regulation S) the Company will not
         register any transfer of such Securities not made in accordance with
         the provisions of Regulation S and will not, except in accor-

                                      -13-

<PAGE>

         dance with the provisions of Regulation S, if applicable, issue any
         such Securities in the form of definitive securities.

                  (m)      None of the Issuers or any of their Affiliates will
         engage in any directed selling efforts (as that term is defined in
         Regulation S) with respect to the Securities.

                  (n)      For a period ending the earlier of completion of the
         Exchange Offer under the Registration Rights Agreement or two years
         (calculated in accordance with paragraphs (d) of Rule 144 under the
         Act) following the date any Securities are acquired from the Issuers or
         any of their Affiliates, none of the Issuers or any of their Affiliates
         will sell any such Securities that were issued on the Closing Date.

                  6.       Expenses. The Company and the Guarantor agree to pay
all costs and expenses incident to the performance of their obligations under
this Agreement, whether or not the transactions contemplated herein are
consummated or this Agreement is terminated pursuant to Section 11 hereof,
including all costs and expenses incident to (i) the printing, word processing
or other production of documents with respect to the transactions contemplated
hereby, including any costs of printing the Preliminary Memorandum and the Final
Memorandum and any amendment or supplement thereto, and any "Blue Sky"
memoranda, (ii) all arrangements relating to the delivery to the Initial
Purchasers of copies of the foregoing documents, (iii) the fees and
disbursements of the counsel, the accountants and any other experts or advisors
retained by the Company or the Guarantor, (iv) preparation (including printing),
issuance and delivery to the Initial Purchasers of the Securities, (v) the
qualification of the Securities under state securities and "Blue Sky" laws,
including filing fees and reasonable fees and disbursements of counsel for the
Initial Purchasers relating thereto; provided, that such fees and expenses of
counsel shall not exceed $5,000, (vi) expenses in connection with the "roadshow"
and any other meetings with prospective investors in the Securities (provided
that the expense of any private aircraft chartered with respect to such
"roadshow" meetings shall be borne 50% by the Company and 50% by the Initial
Purchasers), (vii) fees and expenses of the Trustee including fees and expenses
of counsel for the Trustee, (viii) all expenses and listing fees incurred in
connection with the application for quotation of the Securities on the Portal
Market and (ix) any fees charged by investment rating agencies for the rating of
the Securities. If the sale of the Securities provided for herein is not
consummated because any condition to the obligations of the Initial Purchasers
set forth in Section 7 hereof is not satisfied, because this Agreement is
terminated or because of any failure, refusal or inability on the part of the
Company or the Guarantor to perform all obligations and satisfy all conditions
on its part to be performed or satisfied hereunder (other than solely by reason
of a default by the Initial Purchasers of their obligations hereunder after all
conditions hereunder have been satisfied in accordance herewith), the Company
and the Guarantor agree to promptly reimburse the Initial Purchasers upon demand
for all out-of-pocket expenses (including reasonable fees, disbursements and
charges of Cahill Gordon & Reindel LLP, counsel for the Initial Purchasers) that
shall have been incurred by the Initial Purchasers in connection with the
proposed purchase and sale of the Securities. It is understood, however, that
except as provided herein, the Initial Purchasers will pay for their own
expenses, including the fees of their counsel, any transfer taxes on the resale
of any Notes by them and any expenses connected with any offers they may make.

                                      -14-

<PAGE>

                  7.       Conditions of the Initial Purchasers' Obligations.
The obligation of the Initial Purchasers to purchase and pay for the Securities
shall, in their sole discretion, be subject to the satisfaction or waiver of the
following conditions on or prior to the Closing Date:

                  (a)      On the Closing Date, the Initial Purchasers shall
         have received the opinions, dated as of the Closing Date and addressed
         to the Initial Purchasers, of (i) Jones Day, counsel for the Company
         and the Guarantor in substantially the form of Exhibit A attached
         hereto and (ii) the General Counsel or Associate General Counsel of the
         Company and the Guarantor, in form and substance satisfactory to
         counsel for the Initial Purchasers.

                  (b)      On the Closing Date, the Initial Purchasers shall
         have received the opinion, in form and substance reasonably
         satisfactory to the Initial Purchasers, dated as of the Closing Date
         and addressed to the Initial Purchasers, of Cahill Gordon & Reindel
         LLP, counsel for the Initial Purchasers, with respect to certain legal
         matters relating to this Agreement and such other related matters as
         the Initial Purchasers may reasonably require. In rendering such
         opinion, Cahill Gordon & Reindel LLP shall have received and may rely
         upon such certificates and other documents and information as it may
         reasonably request to pass upon such matters.

                  (c)      The Initial Purchasers shall have received from the
         Independent Accountants a comfort letter or letters dated the date
         hereof and the Closing Date, in form and substance reasonably
         satisfactory to counsel for the Initial Purchasers.

                  (d)      The representations and warranties of the Issuers
         contained in this Agreement shall be true and correct on and as of the
         date hereof and on and as of the Closing Date as if made on and as of
         the Closing Date; the statements of the Issuers' officers made pursuant
         to any certificate delivered in accordance with the provisions hereof
         shall be true and correct in all material respects on and as of the
         date made and on and as of the Closing Date; the Company and the
         Guarantor shall have performed in all material respects all covenants
         and agreements and satisfied all conditions in all material respects on
         their part to be performed or satisfied hereunder at or prior to the
         Closing Date; and, except as described in the Final Memorandum
         (exclusive of any amendment or supplement thereto after the date
         hereof), subsequent to the date of the most recent financial statements
         in such Final Memorandum, there shall have been no event or
         development, and no information shall have become known with respect to
         the business condition (financial or otherwise) or results of
         operations of the Company and its Subsidiaries, taken as a whole, that
         has or could reasonably be expected to result in a Material Adverse
         Effect.

                  (e)      The sale of the Securities hereunder shall not be
         enjoined (temporarily or permanently) on the Closing Date.

                  (f)      Subsequent to the date of the most recent historical
         financial statements in the Final Memorandum (exclusive of any
         amendment or supplement thereto after the date hereof), none of the
         Company or any of the Subsidiaries shall have sustained any loss or
         interference with respect to its business or properties from fire,
         flood, hurricane, accident

                                      -15-

<PAGE>

         or other calamity, whether or not covered by insurance, or from any
         strike, labor dispute, slowdown or work stoppage or from any legal or
         governmental proceeding, order or decree, which loss or interference
         has or could reasonably be expected to result in, individually or in
         the aggregate, a Material Adverse Effect.

                  (g)      The Initial Purchasers shall have received a
         certificate from each of the Issuers, dated the Closing Date, signed on
         behalf of the Company and the Guarantor by its Chairman of the Board,
         President, General Counsel or any Vice President and the Chief
         Financial Officer, to the effect that:

                           (i)      The representations and warranties of the
                  Issuers contained in this Agreement are true and correct in
                  all material respects on and as of the date hereof and on and
                  as of the Closing Date, and the Issuers have performed in all
                  material respects all covenants and agreements and satisfied
                  all conditions in all material respects on their part to be
                  performed or satisfied hereunder at or prior to the Closing
                  Date;

                           (ii)     At the Closing Date, since the date hereof
                  or since the date of the most recent historical financial
                  statements in the Final Memorandum (exclusive of any amendment
                  or supplement thereto after the date hereof), no event or
                  development has occurred, and no information has become known,
                  that has or could reasonably be expected to result in a
                  Material Adverse Effect; and

                           (iii)    The sale of the Securities hereunder has not
                  been enjoined (temporarily or permanently).

                  (h)      On the Closing Date, the Initial Purchasers shall
         have received the Registration Rights Agreement executed by each of the
         Issuers and such agreement shall be in full force and effect.

                  (i)      The Company shall have delivered to the Initial
         Purchasers a true, correct and complete copy of the Credit Agreement;
         the Company, the Guarantor, the other Subsidiaries party thereto and
         the other parties thereto shall have executed and delivered the Credit
         Agreement, and the Credit Agreement shall be in full force and effect,
         subject only to the Closing hereunder and the closing of the CVC Sale.

                  (j)      The Company shall have delivered to the Initial
         Purchasers a true, correct and complete copy of the documents governing
         the CVC Sale; such documents shall be in full force and effect and the
         CVC sale shall have occurred but for the release of the CVC Notes in
         the systems of The Depository Trust Company, which shall occur
         concurrently with the Closing hereunder (for the avoidance of doubt,
         the concurrent issuance of the CVC Notes is a condition to the Initial
         Purchasers' obligations hereunder).

                  (k)      The Securities shall be eligible for clearance and
         settlement through The Depository Trust Company.

                                      -16-

<PAGE>

                  (l)      The Securities shall be designated Portal-eligible
         securities in accordance with the rules and regulations of the NASD.

                  On or before the Closing Date, the Initial Purchasers and
counsel for the Initial Purchasers shall have received such further documents,
opinions, certificates, letters and schedules or instruments relating to the
business, corporate, legal and financial affairs of the Company and the
Subsidiaries as they shall have heretofore reasonably requested from the
Company.

                  All such documents, opinions, certificates, letters, schedules
or instruments delivered pursuant to this Agreement will comply with the
provisions hereof only if they are reasonably satisfactory in all material
respects to the Initial Purchasers and counsel for the Initial Purchasers. The
Issuers shall furnish to the Initial Purchasers conformed copies of such
documents, opinions, certificates, letters, schedules and instruments in such
reasonable quantities as the Initial Purchasers shall reasonably request.

                  8.       Offering of Securities; Restrictions on Transfer. (a)
Each of the Initial Purchasers represents and warrants and agrees with the
Issuers (in each case, as to itself only) that (i) it has not and will not
solicit offers for, or offer or sell, the Securities by any form of general
solicitation or general advertising (as those terms are used in Regulation D
under the Act) or in any manner involving a public offering within the meaning
of Section 4(2) of the Act; and (ii) it has and will solicit offers for the
Securities only from, and will offer the Securities only to, (A) in the case of
offers inside the United States, persons whom the Initial Purchasers reasonably
believe to be QIBs or, if any such person is buying for one or more
institutional accounts for which such person is acting as fiduciary or agent,
only when such person has represented to the Initial Purchasers that each such
account is a QIB, to whom notice has been given that such sale or delivery is
being made in reliance on Rule 144A, and, in each case, in transactions under
Rule 144A and (B) in the case of offers outside the United States, to persons
other than U.S. persons ("non-U.S. purchasers," which term shall include dealers
or other professional fiduciaries in the United States acting on a discretionary
basis for non-U.S. beneficial owners (other than an estate or trust)); provided,
however, that, in the case of this clause (B), in purchasing such Securities
such non-U.S. purchasers are deemed to have represented and agreed as provided
under the caption "Transfer Restrictions" contained in the Final Memorandum (or,
if the Final Memorandum is not in existence, in the most recent Memorandum).

                  (b)      Each of the Initial Purchasers represents and
warrants and agrees (as to itself only) with respect to offers and sales outside
the United States that (i) it has and will comply with all applicable laws and
regulations in each jurisdiction in which it acquires, offers, sells or delivers
Securities or has in its possession or distributes any Memorandum or any such
other material, in all cases at its own expense; (ii) the Securities have not
been and will not be offered or sold within the United States or to, or for the
account or benefit of, U.S. persons except in accordance with Regulation S under
the Act or pursuant to an exemption from the registration requirements of the
Act; and (iii) it has offered the Securities and will offer and sell the
Securities (A) as part of its distribution at any time and (B) otherwise until
40 days after the later of the commencement of the offering and the Closing
Date, only in accordance with Rule 903 of Regulation S and, accordingly, neither
it nor any persons acting on its behalf have engaged or

                                      -17-

<PAGE>

will engage in any directed selling efforts (within the meaning of Regulation S)
with respect to the Securities, and any such persons have complied and will
comply with the offering restrictions requirement of Regulation S.

                  (c)      Each of the Initial Purchasers represents and
warrants (as to itself only) that is a "qualified institutional buyer" within
the meaning of Rule 144A.

                  Terms used in this Section 8 and not defined in this Agreement
have the meanings given to them in Regulation S.

                  9.       Indemnification and Contribution. (a) The Issuers,
jointly and severally, agree to indemnify and hold harmless each Initial
Purchaser and each person, if any, who controls any Initial Purchaser within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act against any
losses, claims, damages or liabilities to which any Initial Purchaser or such
controlling person may become subject under the Act, the Exchange Act or
otherwise, insofar as any such losses, claims, damages or liabilities (or
actions in respect thereof) arise in connection with third party claims that
arise out of or are based upon:

                  (i)      any untrue statement or alleged untrue statement of
         any material fact contained in any Memorandum or any amendment or
         supplement thereto; or

                  (ii)     the omission or alleged omission to state, in any
         Memorandum or any amendment or supplement thereto, a material fact
         necessary to make the statements therein in light of the circumstances
         under which they were made, not misleading,

and will reimburse, as incurred, the Initial Purchasers and each such
controlling person for any reasonable legal or other expenses incurred by the
Initial Purchasers or such controlling person in connection with investigating,
defending against or appearing as a third-party witness in connection with any
such loss, claim, damage, liability or action; provided, however, that the
Issuers will not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon any untrue statement
or alleged untrue statement or omission or alleged omission made in any
Memorandum or any amendment or supplement thereto in reliance upon and in
conformity with written information concerning the Initial Purchasers furnished
to the Issuers by the Initial Purchasers through Deutsche Bank Securities Inc.
specifically for use therein; and provided, further, that the Issuers will not
be liable to any Initial Purchaser or any person controlling such Initial
Purchaser with respect to any such untrue statement or alleged untrue statement
or omission or alleged omission made in any Preliminary Memorandum that is
corrected in the Final Memorandum (or any amendment or supplement thereto) if
the person asserting any such loss, claim, damage or liability purchased Notes
from such Initial Purchaser but was not sent or given a copy of the Final
Memorandum (as amended or supplemented), unless such failure to deliver the
Final Memorandum (as amended or supplemented) was a result of noncompliance by
the Issuers with Section 5 hereof. The indemnity provided for in this Section 9
will be in addition to any liability that the Issuers may otherwise have to the
indemnified parties. The Issuers shall not be liable under this Section 9 for
any settlement of any claim or action effected without their prior written
consent, which shall not be unreasonably withheld.

                                      -18-

<PAGE>

                  (b)      Each Initial Purchaser, severally and not jointly,
agrees to indemnify and hold harmless the Issuers, their respective directors,
their officers and each person, if any, who controls the Issuers within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act against any
losses, claims, damages or liabilities to which the Issuers or any such
director, officer or controlling person may become subject under the Act, the
Exchange Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise in connection with third party
claims that arise out of or are based upon (i) any untrue statement or alleged
untrue statement of any material fact contained in any Memorandum or any
amendment or supplement thereto, or (ii) the omission or the alleged omission to
state in any Memorandum or any amendment or supplement thereto a material fact
necessary to make the statements therein in light of the circumstances under
which they were made not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information concerning such Initial Purchaser furnished to the Issuers by such
Initial Purchaser through Deutsche Bank Securities Inc. specifically for use
therein; and subject to the limitation set forth immediately preceding this
clause, will reimburse, as incurred, any reasonable legal or other expenses
incurred by such Issuer or any such director, officer or controlling person in
connection with investigating or defending against or appearing as a third-party
witness in connection with any such loss, claim, damage, liability or action in
respect thereof. The indemnity provided for in this Section 9 will be in
addition to any liability that the Initial Purchasers may otherwise have to the
indemnified parties. The Initial Purchasers shall not be liable under this
Section 9 for any settlement of any claim or action effected without their
consent, which shall not be unreasonably withheld.

                  (c)      Promptly after receipt by an indemnified party under
this Section 9 of notice of the commencement of any action for which such
indemnified party is entitled to indemnification under this Section 9, such
indemnified party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 9, notify the indemnifying party of the
commencement thereof in writing; but the omission to so notify the indemnifying
party (i) will not relieve it from any liability under paragraph (a) or (b)
above unless and to the extent such failure results in the forfeiture by the
indemnifying party of substantial rights and defenses and (ii) will not, in any
event, relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraphs (a) and
(b) above. In case any such action is brought against any indemnified party, and
it notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein and, to the extent that it may
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel reasonably satisfactory to such indemnified
party; provided, however, that if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present such counsel
with a conflict of interest, (ii) the defendants in any such action include both
the indemnified party and the indemnifying party and the indemnified party shall
have been advised by counsel that there may be one or more legal defenses
available to it and/or other indemnified parties that are different from or
additional to those available to the indemnifying party, or (iii) the
indemnifying party shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after receipt by the indemnifying party of notice of the institution of
such action, then,

                                      -19-

<PAGE>

in each such case, the indemnifying party shall not have the right to direct the
defense of such action on behalf of such indemnified party or parties and such
indemnified party or parties shall have the right to select separate counsel to
defend such action on behalf of such indemnified party or parties. After notice
from the indemnifying party to such indemnified party of its election so to
assume the defense thereof and approval by such indemnified party of counsel
appointed to defend such action, the indemnifying party will not be liable to
such indemnified party under this Section 9 for any legal or other expenses,
other than reasonable costs of investigation, subsequently incurred by such
indemnified party in connection with the defense thereof, unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the immediately preceding sentence (it being understood, however,
that in connection with such action the indemnifying party shall not be liable
for the expenses of more than one separate counsel (in addition to local
counsel) in any one action or separate but substantially similar actions in the
same jurisdiction arising out of the same general allegations or circumstances,
designated by the Initial Purchasers in the case of paragraph (a) of this
Section 9 or the Issuers in the case of paragraph (b) of this Section 9,
representing the indemnified parties under such paragraph (a) or paragraph (b),
as the case may be, who are parties to such action or actions) or (ii) the
indemnifying party has authorized in writing the employment of counsel for the
indemnified party at the expense of the indemnifying party. All fees and
expenses reimbursed pursuant to this paragraph (c) shall be reimbursed as they
are incurred. After such notice from the indemnifying party to such indemnified
party, the indemnifying party will not be liable for the costs and expenses of
any settlement of such action effected by such indemnified party without the
prior written consent of the indemnifying party (which consent shall not be
unreasonably withheld), unless such indemnified party waived in writing its
rights under this Section 9, in which case the indemnified party may effect such
a settlement without such consent. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement or
compromise of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party, or indemnity could have been
sought hereunder by any indemnified party, unless such settlement (A) includes
an unconditional written release of the indemnified party, in form and substance
reasonably satisfactory to the indemnified party, from all liability on claims
that are the subject matter of such proceeding and (B) does not include any
statement as to an admission of fault, culpability or failure to act by or on
behalf of any indemnified party.

                  (d)      In circumstances in which the indemnity agreement
provided for in the preceding paragraphs of this Section 9 is unavailable to, or
insufficient to hold harmless, an indemnified party in respect of any losses,
claims, damages or liabilities (or actions in respect thereof), each
indemnifying party, in order to provide for just and equitable contribution,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (or actions in respect
thereof) in such proportion as is appropriate to reflect (i) the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party on the other from the offering of the Securities or (ii) if
the allocation provided by the foregoing clause (i) is not permitted by
applicable law, not only such relative benefits but also the relative fault of
the indemnifying party or parties on the one hand and the indemnified party on
the other in connection with the statements or omissions or alleged statements
or omissions that resulted in such losses, claims, damages or liabilities (or
actions in respect thereof). The relative benefits received by the Issuers on
the one hand and any Initial Pur-

                                      -20-

<PAGE>

chaser on the other shall be deemed to be in the same proportion as the total
proceeds from the offering (before deducting expenses) received by the Issuers
bear to the total discounts and commissions received by such Initial Purchaser.
The relative fault of the parties shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Issuers on the one hand, or such Initial Purchaser
on the other, the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission or alleged
statement or omission, and any other equitable considerations appropriate in the
circumstances. The Issuers and the Initial Purchasers agree that it would not be
equitable if the amount of such contribution were determined by pro rata or per
capita allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in the first sentence of this
paragraph (d). Notwithstanding any other provision of this paragraph (d), no
Initial Purchaser shall be obligated to make contributions hereunder that in the
aggregate exceed the total discounts, commissions and other compensation
received by such Initial Purchaser under this Agreement, less the aggregate
amount of any damages that such Initial Purchaser has otherwise been required to
pay by reason of the untrue or alleged untrue statements or the omissions or
alleged omissions to state a material fact, and no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this paragraph (d), each person, if any, who
controls an Initial Purchaser within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act shall have the same rights to contribution as the
Initial Purchasers, and each director of either of the Issuers, each officer of
either of the Issuers and each person, if any, who controls either of the
Issuers within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act shall have the same rights to contribution as either the Issuers.

                  10.      Survival Clause. The respective representations,
warranties, agreements, covenants, indemnities and other statements of the
Issuers, their officers and the Initial Purchasers set forth in this Agreement
or made by or on behalf of them pursuant to this Agreement shall remain in full
force and effect, regardless of (i) any investigation made by or on behalf of
the Issuers, any of their officers or directors, the Initial Purchasers or any
controlling person referred to in Section 9 hereof and (ii) delivery of and
payment for the Securities. The respective agreements, covenants, indemnities
and other statements set forth in Sections 6, 9, 10 and 15 hereof shall remain
in full force and effect, regardless of any termination or cancellation of this
Agreement.

                  11.      Termination. (a) This Agreement may be terminated in
the reasonable discretion of the Initial Purchasers by notice to the Issuers
given prior to the Closing Date in the event that the Issuers shall have failed,
refused or been unable to perform all obligations and satisfy all conditions on
their part to be performed or satisfied hereunder at or prior thereto or, if at
or prior to the Closing Date:

                  (i)      any of the Company or the Subsidiaries shall have
         sustained any loss or interference with respect to its businesses or
         properties from fire, flood, hurricane, accident or other calamity,
         whether or not covered by insurance, or from any strike, labor

                                      -21-

<PAGE>

         dispute, slowdown or work stoppage or any legal or governmental
         proceeding, which loss or interference, in the reasonable judgment of
         the Initial Purchasers, has had or has a Material Adverse Effect, or
         there shall have been, in the reasonable judgment of the Initial
         Purchasers, any event or development that, individually or in the
         aggregate, has or could be reasonably likely to have a Material Adverse
         Effect (including without limitation a change in control of the Company
         or the Subsidiaries), except in each case as described in the Final
         Memorandum (exclusive of any amendment or supplement thereto);

                  (ii)     a banking moratorium shall have been declared by New
         York or United States authorities or a material disruption in
         commercial banking or securities settlement or clearance services in
         the United States;

                  (iii)    there shall have been (A) an outbreak of hostilities
         or escalation of existing hostilities between the United States and any
         foreign power, or (B) an outbreak of insurrection or armed conflict or
         escalation of any other existing insurrection or armed conflict
         involving the United States or any other national or international
         calamity or emergency, or (C) any material change in the financial
         markets of the United States which, in the case of (A), (B) or (C)
         above and in the reasonable judgment of the Initial Purchasers, makes
         it impracticable or inadvisable to proceed with the offering or the
         delivery of the Notes as contemplated by the Final Memorandum; or

                  (iv)     any securities of the Company shall have been
         downgraded by any nationally recognized statistical rating organization
         or any such organization shall have publicly announced that it has
         under surveillance or review, or has changed its outlook with respect
         to, its ratings of any securities of the Company (other than an
         announcement with positive implications of a possible upgrading).

                  (b)      Termination of this Agreement pursuant to this
Section 11 shall be without liability of any party to any other party except as
provided in Section 10 hereof.

                  12.      Information Supplied by the Initial Purchasers. The
statements set forth in the last paragraph on the front cover page and in the
second, third and fourth sentences of the sixth paragraph under the heading
"Private Placement" in the Final Memorandum (to the extent such statements
relate to the Initial Purchasers) constitute the only information furnished by
the Initial Purchasers to the Company for the purposes of Sections 2(a) and 9
hereof.

                  13.      Notices. All communications hereunder shall be in
writing and, if sent to the Initial Purchasers, shall be mailed or delivered to
Deutsche Bank Securities Inc., 60 Wall Street, New York, New York 10005,
Attention: Corporate Finance Department; if sent to the Company, shall be mailed
or delivered to the Company at ERICO International Corporation, 30575 Bainbridge
Road, Suite 300, Solon, Ohio 44139, Attention: General Counsel; with a copy to
Jones Day, North Point, 901 Lakeside Avenue, Cleveland, Ohio, 44114-1190,
Attention: Patrick J. Leddy.

                  All such notices and communications shall be deemed to have
been duly given: when delivered by hand, if personally delivered; five business
days after being deposited in the

                                      -22-

<PAGE>

mail, postage prepaid, if mailed; and one business day after being timely
delivered to a next-day air courier.

                  14.      Successors. This Agreement shall inure to the benefit
of and be binding upon the Initial Purchasers, the Issuers and their respective
successors and legal representatives, and nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any other person any legal
or equitable right, remedy or claim under or in respect of this Agreement, or
any provisions herein contained; this Agreement and all conditions and
provisions hereof being intended to be and being for the sole and exclusive
benefit of such persons and for the benefit of no other person except that (i)
the indemnities of the Issuers contained in Section 9 of this Agreement shall
also be for the benefit of any person or persons who control the Initial
Purchasers within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act and (ii) the indemnities of the Initial Purchasers contained in
Section 9 of this Agreement shall also be for the benefit of the directors of
the Issuers, their respective officers and any person or persons who control
either of the Issuers within the meaning of Section 15 of the Act or Section 20
of the Exchange Act. No purchaser of Securities from the Initial Purchasers will
be deemed a successor because of such purchase.

                  15.      APPLICABLE LAW. THE VALIDITY AND INTERPRETATION OF
THIS AGREEMENT, AND THE TERMS AND CONDITIONS SET FORTH HEREIN SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE
TO CONTRACTS MADE AND TO BE PERFORMED WHOLLY THEREIN, WITHOUT GIVING EFFECT TO
ANY PROVISIONS THEREOF RELATING TO CONFLICTS OF LAW.

                  16.      Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.

                                      -23-

<PAGE>

                  If the foregoing correctly sets forth our understanding,
please indicate your acceptance thereof in the space provided below for that
purpose, whereupon this letter shall constitute a binding agreement between the
Company and the Initial Purchasers.

                                     Very truly yours,

                                     ERICO INTERNATIONAL CORPORATION

                                     By:            /s/ Peter B. Korte
                                         --------------------------------------
                                         Name: Peter B. Korte
                                         Title: General Counsel and Secretary

                                     ERICO PRODUCTS, INC.

                                     By:            /s/ Peter B. Korte
                                         --------------------------------------
                                         Name: Peter B. Korte
                                         Title: General Counsel and Secretary

<PAGE>

The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.

DEUTSCHE BANK SECURITIES INC.
    On behalf of the several Initial Purchasers
    listed on Schedule 1 hereto.

By: /s/ Steven Winograd
    ---------------------------------
    Name: Steven Winograd
    Title: Managing Director

By: /s/ Arthur Schoen
    ----------------------------------
    Name: Arthur Schoen
    Title: Managing Director

<PAGE>

                                                                      SCHEDULE 1

<TABLE>
<CAPTION>
                                                              Principal
                                                               Amount
Initial Purchaser                                           of Securities
-----------------                                           -------------
<S>                                                         <C>
Deutsche Bank Securities Inc. .........................     $  70,275,600
J.P. Morgan Securities Inc.............................     $  46,850,400
ABN AMRO Incorporated..................................     $   2,053,350
NatCity Investments, Inc...............................     $   1,287,900
McDonald Investments Inc...............................     $   1,032,750
                                                            -------------
          Total........................................     $ 121,500,000
</TABLE>

<PAGE>

                                                                      SCHEDULE 2

                           SUBSIDIARIES OF THE COMPANY

<TABLE>
<CAPTION>
NAME                                                                               JURISDICTION OF INCORPORATION
<S>                                                                                <C>
ERICO Global Company                                                               Delaware
   ERICO Holding Company                                                           Ohio
         ERICO International Corporation                                           Ohio
                  ERICO Products, Inc.                                             Ohio
                  ERICO Mexico, S.A.                                               Mexico
                  ERICO Canada Inc.                                                Canada
                  ERICO do Brasil Commercio E. Industrial Ltda.                    Brazil
                  ERICO Chile Commercial Industrial Ltda.                          Chile
                      ERICO del Pacifico Ltda.                                     Chile
                  ERICO Products Australia Pty. Limited                            Australia
                  ERICO Cadweld (Asia) Ltd.                                        Hong Kong
                  ERICO Lightning Technologies Pty. Ltd.                           Australia
                  ERICO Lightning Technology Kowloon Limited                       Hong Kong
                  ERICO Pacific Ltd.                                               Taiwan
                  ERICO Europe Holding B.V.                                        Netherlands
                      ERICO GmbH                                                   Germany
                      ERICO Italia S.r.l.                                          Italy
                      ERICO B.V.                                                   Netherlands
                      ERICO Europe B.V.                                            Netherlands
                      Productos ERICO S.A.                                         Spain
                      ERICO Eruopa Ltd. (G.B.)                                     United Kingdom
                      ERICO France SARL                                            France
                      ERICO SARL                                                   France
                      ERICO Benelux B.v.b.a.                                       Belgium
                      ERICO Products A.G.                                          Switzerland
                      ERIFIX B.V.* (Inactive)                                      Netherlands
                          Netherlandse Aardelektroden                              Netherlands
                  ERICO Poland SP. Z.O.O.                                          Poland
                  EUROSTRUT B.V.                                                   Netherlands
                  ERICO Lightning Protection (G.B.) Limited                        United Kingdom
                  Beta Earthing (Pty) Limited                                      South Africa
                       ERICO Technologies Africa (Pty) Limited                     South Africa
                       CADWELD (Pty) Ltd.                                          South Africa
</TABLE><PAGE>

                                                                    EXHIBIT 10.1

                           SECOND AMENDED AND RESTATED
                   MULTICURRENCY CREDIT AND SECURITY AGREEMENT

                               (U.S. $120,000,000)

                          Dated as of December 2, 2002

                                      among

                        ERICO INTERNATIONAL CORPORATION,

                              ERICO PRODUCTS, INC.

                                       AND

                                ERICO EUROPA B.V.

                                  as Borrowers

                                       and

                     THE BANKS WHICH ARE SIGNATORIES HERETO

                                       and

                        LASALLE BANK NATIONAL ASSOCIATION

                   as Administrative Agent, Lead Arranger and
                                  Issuing Bank

                                       and

                      GENERAL ELECTRIC CAPITAL CORPORATION

                 as Co-Lead Arranger and Co-Documentation Agent

                               NATIONAL CITY BANK,

                              as Syndication Agent

                          KEYBANK NATIONAL ASSOCIATION,

                             as Documentation Agent

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
Section                                                                                                             Page
-------                                                                                                             ----
<S>                                                                                                                 <C>
SECTION 1 DEFINITIONS AND ACCOUNTING TERMS......................................................................      1
         1.1 RESTATEMENT OF CREDIT FACILITIES...................................................................      1
         1.2 CERTAIN DEFINED TERMS..............................................................................      1
         1.3 COMPUTATION OF TIME PERIODS........................................................................      1
         1.4 ACCOUNTING TERMS...................................................................................      1
         1.5 CURRENCY EQUIVALENTS...............................................................................      2
         1.6 ADDITION OF BORROWERS..............................................................................      2
         1.7 AUTHORIZATION OF BORROWER REPRESENTATIVE TO MAKE REQUESTS..........................................      3
         1.8 CONSTRUCTION OF TERMS GENERALLY....................................................................      3
         1.9 LIABILITY OF BORROWERS.............................................................................      3

SECTION 2 STATEMENT OF TERMS....................................................................................      4
         2.1 REVOLVING CREDIT FACILITY..........................................................................      4
                  (a) REVOLVING CREDIT ADVANCES.................................................................      4
                  (b) REVOLVING CREDIT BORROWINGS...............................................................      4
                  (c) REVOLVING CREDIT NOTES; LOAN ACCOUNT......................................................      4
         2.2 CREDIT REQUESTS....................................................................................      5
                  (a) CREDIT REQUESTS EXECUTED BY BORROWERS.....................................................      5
                  (b) REQUESTS FOR REVOLVING CREDIT BORROWING DEEMED GIVEN......................................      6
         2.3 FUNDING OF REVOLVING CREDIT ADVANCES...............................................................      6
         2.4 AVAILABILITY OF FUNDS..............................................................................      7
         2.5 AFFILIATED FUNDING THROUGH, ON BEHALF OF, OR BY BANKS..............................................      7
                  (a) SPV FUNDING ON BEHALF OF BANKS............................................................      7
                  (b) FUNDING BY BANKS AND ISSUING BANKS ISSUERS THROUGH OR ON BEHALF OF LENDING INSTALLATIONS..      7
         2.6 TERM FACILITY......................................................................................      8
                  (a) TERM ADVANCES.............................................................................      8
                  (b) TERM BORROWINGS...........................................................................      8
                  (c) TERM NOTES................................................................................      9
                  (d) AMORTIZATION AND MATURITY OF TERM ADVANCES................................................      9
         2.7 FUNDING OF TERM ADVANCES BY BANKS..................................................................      9
                  (a) DISBURSEMENT OF TERM FUNDS RECEIVED.......................................................      9
                  (b) AVAILABILITY OF TERM ADVANCE FUNDS........................................................      9
         2.8 FAILURE OF BANK TO FUND............................................................................     10
                  (a) PAYMENT CONSTITUTING RATABLE PORTION......................................................     10
                  (b) CONTINUING BORROWER OBLIGATION............................................................     10
                  (c) TREATMENT OF BANK FAILING TO FUND.........................................................     11
                  (d) CONTINUING BANK OBLIGATION TO FUND........................................................     11
                  (e) EFFECT OF BANK'S FAILURE TO FUND ON OBLIGATIONS OF ISSUING BANK...........................     11
         2.9 REPAYMENTS; PREPAYMENTS; REDUCTION OF COMMITMENT...................................................     12
                  (a) REPAYMENT.................................................................................     12
                  (b) MANDATORY PREPAYMENT; CALCULATION.........................................................     12
                  (c) MANDATORY APPLICATION OF NET PROCEEDS; EXCESS CASH FLOW RECAPTURE.........................     12
                  (d) REDUCTION OF REVOLVING CREDIT COMMITMENT..................................................     13
                  (e) PERMITTED PREPAYMENTS.....................................................................     13
         2.10 RATE CONVERSION AND RATE CONTINUATION.............................................................     14
         2.11 LETTERS OF CREDIT.................................................................................     15
                  (a) MASTER LETTER OF CREDIT AGREEMENT.........................................................     16
</TABLE>

                                       i

<PAGE>

<TABLE>
<CAPTION>
Section                                                                                                             Page
-------                                                                                                             ----
<S>                                                                                                                 <C>
                  (b) EXISTING LETTERS OF CREDIT................................................................     16
                  (c) TERM; FORM AND CONDITIONS OF LETTERS OF CREDIT............................................     16
                  (d) REQUESTS FOR LETTERS OF CREDIT............................................................     17
                  (e) PARTICIPATION BY BANKS....................................................................     17
                  (f) REIMBURSEMENT; INTEREST...................................................................     18
                  (g) FAILURE TO REIMBURSE......................................................................     18
                  (h) OBLIGATIONS ABSOLUTE......................................................................     18
                  (i) LIABILITY OF ISSUING BANKS................................................................     19
                  (j) BANK INDEMNITY............................................................................     19
                  (k) EFFECT OF APPLICABLE LAW OR CUSTOM........................................................     20
                  (l) TERMINATION OF LETTER OF CREDIT COMMITMENT................................................     20
         2.12 FEES..............................................................................................     20
                  (a) STRUCTURING FEE...........................................................................     20
                  (b) LATE CHARGES..............................................................................     21
                  (c) LETTER OF CREDIT FEES.....................................................................     21
                  (d) LETTER OF CREDIT FEE PERCENTAGES..........................................................     22
                  (e) AGENT'S FEE...............................................................................     23
                  (f) FACILITY FEE..............................................................................     23
                  (g) FACILITY FEE PERCENTAGES..................................................................     23
                  (h) PAYMENT OF FEES; NONREFUNDABLE............................................................     24
         2.13 INTEREST..........................................................................................     24
                  (a) REVOLVING CREDIT BORROWING INTEREST RATE..................................................     24
                  (b) REVOLVING CREDIT MARGIN ADJUSTMENT........................................................     25
                  (c) TERM BORROWING INTEREST RATE..............................................................     26
                  (d) TERM MARGIN ADJUSTMENT....................................................................     27
                  (e) DEFAULT INTEREST..........................................................................     28
                  (f) INTEREST RATE DETERMINATION...............................................................     28
         2.14 EXTENSION OF REVOLVING CREDIT TERMINATION DATE....................................................     29
         2.15 PAYMENTS AND COMPUTATIONS.........................................................................     29
                  (a) PAYMENTS..................................................................................     29
                  (b) APPLICATION OF PAYMENTS...................................................................     29
                  (c) COMPUTATIONS OF INTEREST AND FEES.........................................................     30
                  (d) PAYMENT NOT ON BUSINESS DAY...............................................................     30
                  (e) PRESUMPTION OF PAYMENT IN FULL BY BORROWER................................................     30
         2.16 LIBOR ADVANCES: UNASCERTAINABLE RATE; ILLEGALITY; INCREASED COSTS.................................     30
                  (a) UNASCERTAINABLE RATE; ILLEGALITY; INCREASED COSTS.........................................     30
                  (b) CANCELLATION OF REQUESTS; CONVERSION OF OUTSTANDINGS......................................     32
         2.17 PRO RATA TREATMENT................................................................................     32
         2.18 SHARING OF SETOFFS................................................................................     32
         2.19 FAILURE TO PAY IN AN ALTERNATE CURRENCY...........................................................     33
         2.20 OPTIONAL CURRENCY AMOUNTS.........................................................................     33

SECTION 3 CONDITIONS OF LENDING.................................................................................     33
         3.1 CONDITIONS PRECEDENT TO LOANS ADVANCED ON RESTATEMENT DATE.........................................     33
         3.2 CONDITIONS PRECEDENT TO ALL ADVANCES...............................................................     33
                  (a) REPRESENTATION BRINGDOWN..................................................................     33
                  (b) NO DEFAULT; COMPLIANCE WITH TERMS.........................................................     34
                  (c) NO MATERIAL ADVERSE CHANGE................................................................     34
         3.3 CONDITIONS PRECEDENT TO ADVANCES TO BORROWERS EXECUTING ADDITIONAL BORROWER ADDENDUM...............     34

SECTION 4 SECURITY INTEREST IN COLLATERAL; COLLATERAL REQUIREMENTS..............................................     34
         4.1 GRANT OF SECURITY INTEREST.........................................................................     34
</TABLE>

                                       ii

<PAGE>

<TABLE>
<CAPTION>
Section                                                                                                             Page
-------                                                                                                             ----
<S>                                                                                                                 <C>
         4.2 REQUIRED GRANT OF REAL PROPERTY LIENS..............................................................     35
         4.3 PERFECTION.........................................................................................     35
                  (a) AUTHORIZATION BY DEBTOR...................................................................     35
                  (b) CONTROL ACCOUNTS..........................................................................     36
                  (c) CONTROL OF INVESTMENT PROPERTY............................................................     36
         4.4 GENERAL REPRESENTATIONS AS TO COLLATERAL...........................................................     36
         4.5 CHANGES AFFECTING PERFECTION.......................................................................     37
         4.6 POWER OF ATTORNEY FOR INSURANCE....................................................................     37
         4.7 PROTECTION OF COLLATERAL; REIMBURSEMENT............................................................     37
         4.8 REINSTATEMENT......................................................................................     38
         4.9 TERMINATION OF SECURITY INTEREST; RELEASE OF COLLATERAL............................................     38

SECTION 5 GENERAL REPRESENTATIONS AND WARRANTIES................................................................     38
         5.1 EXISTENCE..........................................................................................     39
         5.2 AUTHORIZATION......................................................................................     39
         5.3 ENFORCEABILITY.....................................................................................     39
         5.4 LITIGATION; PROCEEDINGS............................................................................     39
         5.5 TAXES..............................................................................................     39
         5.6 TITLE..............................................................................................     40
         5.7 LIEN PRIORITY......................................................................................     40
         5.8 CONSENTS; APPROVALS................................................................................     40
         5.9 LAWFUL OPERATIONS..................................................................................     40
         5.10 ENVIRONMENTAL COMPLIANCE..........................................................................     40
         5.11 ERISA.............................................................................................     40
         5.12 FINANCIAL STATEMENTS..............................................................................     41
         5.13 INTELLECTUAL PROPERTY.............................................................................     41
         5.14 VALUE; SOLVENCY...................................................................................     41
         5.15 INVESTMENT COMPANY ACT STATUS.....................................................................     42
         5.16 REGULATION U/REGULATION X COMPLIANCE..............................................................     42
         5.17 ACQUISITION AGREEMENT.............................................................................     42
         5.18 ACQUISITION DOCUMENTS.............................................................................     42
         5.19 FULL DISCLOSURE...................................................................................     42
         5.20 RECAPITALIZATION..................................................................................     42
         5.21 MERGER AGREEMENT AND MERGER DOCUMENTS.............................................................     43

SECTION 6 COVENANTS OF THE BORROWERS............................................................................     43
         6.1 REPORTING AND NOTICE COVENANTS.....................................................................     43
                  (a) QUARTERLY FINANCIAL STATEMENTS............................................................     43
                  (b) ANNUAL FINANCIAL STATEMENTS...............................................................     43
                  (c) OFFICER'S CERTIFICATE.....................................................................     44
                  (d) ANNUAL BUDGET.............................................................................     44
                  (e) NOTICE OF DEFAULT.........................................................................     45
                  (f) OTHER INFORMATION AND DELIVERIES..........................................................     45
                  (g) NOTICES...................................................................................     45
                  (h) NOTICE OF DEFAULT UNDER ERISA.............................................................     45
                  (i) LANDLORD WAIVERS..........................................................................     46
         6.2 AFFIRMATIVE COVENANTS..............................................................................     46
                  (a) CORPORATE EXISTENCE.......................................................................     46
                  (b) FINANCIAL RECORDS.........................................................................     46
                  (c) VISITATION................................................................................     46
                  (d) COMPLIANCE WITH LAWS......................................................................     47
                  (e) COMPLIANCE WITH ENVIRONMENTAL LAWS........................................................     47
                  (f) PROPERTIES................................................................................     47
                  (g) USE OF PROCEEDS...........................................................................     48
</TABLE>

                                      iii

<PAGE>

<TABLE>
<CAPTION>
Section                                                                                                             Page
-------                                                                                                             ----
<S>                                                                                                                 <C>
                  (h) TAXES.....................................................................................     48
                  (i) INSURANCE.................................................................................     48
                  (j) ADDITIONAL GUARANTORS.....................................................................     48
                  (k) PLEDGE OF STOCK OF FOREIGN SUBSIDIARIES...................................................     48
         6.3 NEGATIVE COVENANTS.................................................................................     49
                  (a) EQUITY TRANSACTIONS.......................................................................     49
                  (b) INDEBTEDNESS..............................................................................     49
                  (c) LIENS; LEASES.............................................................................     50
                  (d) INVESTMENTS...............................................................................     51
                  (e) DIVIDENDS AND MANAGEMENT FEES.............................................................     52
                  (f) CHANGE IN NATURE OF BUSINESS..............................................................     52
                  (g) COMPLIANCE WITH ERISA.....................................................................     53
                  (h) REGULATION U COMPLIANCE...................................................................     53
                  (i) ACCOUNTING CHANGES........................................................................     53
                  (j) ARM'S-LENGTH TRANSACTIONS.................................................................     53
                  (k) PAYMENT OF INDEBTEDNESS...................................................................     54
                  (l) REDEMPTION OF SENIOR SUBORDINATED NOTES...................................................     54
                  (m) DEFEASANCE UNDER THE SENIOR SUBORDINATED INDENTURE........................................     54
                  (n) AMENDMENT OF THE SENIOR SUBORDINATED INDENTURE AND HOLDING SENIOR SUBORDINATED INDENTURE..     54
                  (o) PLEDGE OF STOCK OF FOREIGN SUBSIDIARIES...................................................     54
         6.4 FINANCIAL COVENANTS................................................................................     55
                  (a) CONSOLIDATED NET WORTH....................................................................     55
                  (b) CONSOLIDATED FIXED CHARGE COVERAGE RATIO..................................................     55
                  (c) CONSOLIDATED FUNDED DEBT TO EBITDA RATIO..................................................     55
                  (d) CONSOLIDATED FUNDED DEBT TO EBITDA OF ERICO PRODUCTS RATIO................................     55
                  (e) CONSOLIDATED SENIOR FUNDED DEBT TO EBITDA RATIO...........................................     55
                  (f) MINIMUM CONSOLIDATED EBITDA...............................................................     56

SECTION 7 EVENTS OF DEFAULT.....................................................................................     56
         7.1 PAYMENT............................................................................................     56
         7.2 REPRESENTATIONS AND WARRANTIES.....................................................................     56
         7.3 REPORTING AND NOTICE PROVISIONS; VIOLATION OF CERTAIN AFFIRMATIVE COVENANTS........................     56
         7.4 VIOLATION OF NEGATIVE COVENANTS, CERTAIN AFFIRMATIVE COVENANTS AND FINANCIAL COVENANTS.............     56
         7.5 OTHER LOAN DOCUMENTS...............................................................................     57
         7.6 CROSS-DEFAULT......................................................................................     57
         7.7 MATERIAL ADVERSE EFFECT............................................................................     57
         7.8 CONTROL............................................................................................     57
         7.9 FAILURE OF ENFORCEABILITY OF THIS AGREEMENT, CREDIT DOCUMENT; SECURITY.............................     57
         7.10 ERISA.............................................................................................     57
         7.11 JUDGMENTS.........................................................................................     58
         7.12 FORFEITURE PROCEEDINGS............................................................................     58
         7.13 FINANCIAL IMPAIRMENT..............................................................................     58

SECTION 8 REMEDIES..............................................................................................     58
         8.1 OPTIONAL DEFAULTS..................................................................................     58
         8.2 AUTOMATIC DEFAULTS.................................................................................     58
         8.3 GENERAL RIGHTS AND REMEDIES OF ADMINISTRATIVE AGENT AND THE BANKS..................................     59
         8.4 EXERCISE OF ADDITIONAL REMEDIES....................................................................     59
                  (a) POSSESSION OF COLLATERAL..................................................................     59
                  (b) FORECLOSURE OF LIENS......................................................................     59
                  (c) DISPOSITION OF COLLATERAL.................................................................     60
</TABLE>

                                       iv

<PAGE>

<TABLE>
<CAPTION>
Section                                                                                                             Page
-------                                                                                                             ----
<S>                                                                                                                 <C>
                  (d) NOTIFICATION OF ACCOUNT DEBTORS...........................................................     60
                  (e) APPLICATION OF COLLATERAL.................................................................     60
         8.5 LIMITED LICENSE TO LIQUIDATE.......................................................................     60
         8.6 SET-OFF............................................................................................     61
         8.7 AUTHORITY TO EXECUTE TRANSFERS.....................................................................     61
         8.8 TERMINATION; EFFECT ON BORROWER OBLIGATIONS........................................................     61
         8.9 ACTIONS IN RESPECT OF THE LETTERS OF CREDIT UPON DEFAULT...........................................     61
         8.10 LETTER OF CREDIT COLLATERAL ACCOUNT...............................................................     62
                  (a) APPLICATION...............................................................................     62
                  (b) NO BORROWER OR THIRD PARTY CLAIMS.........................................................     62
                  (c) NO LIENS OR TRANSFERS OF ACCOUNT..........................................................     62
                  (d) REASONABLE CARE...........................................................................     62
         8.11 REMEDIES CUMULATIVE...............................................................................     62

SECTION 9 BORROWER GUARANTY.....................................................................................     62
         9.1 CROSS-GUARANTY.....................................................................................     62
         9.2 MAXIMUM LIABILITY..................................................................................     63
         9.3 GUARANTY UNCONDITIONAL.............................................................................     63
         9.4 DISCHARGE; REINSTATEMENT...........................................................................     63
         9.5 WAIVER.............................................................................................     64
         9.6 STAY OF ACCELERATION...............................................................................     64

SECTION 10 THE ADMINISTRATIVE AGENT.............................................................................     64
         10.1 THE ADMINISTRATIVE AGENT..........................................................................     64
         10.2 LEAD ARRANGER.....................................................................................     65
         10.3 NATURE OF APPOINTMENT.............................................................................     65
         10.4 ADMINISTRATIVE AGENT AS A BANK; OTHER TRANSACTIONS................................................     65
         10.5 INSTRUCTIONS FROM BANKS...........................................................................     65
         10.6 BANK'S DILIGENCE..................................................................................     66
         10.7 BANK CONSENT......................................................................................     66
         10.8 NO IMPLIED REPRESENTATIONS........................................................................     66
         10.9 ADMINISTRATIVE AGENT'S DILIGENCE..................................................................     66
         10.10 NOTICE OF DEFAULT................................................................................     67
         10.11 ADMINISTRATIVE AGENT'S LIABILITY.................................................................     67
         10.12 ADMINISTRATIVE AGENT'S AND LEAD ARRANGER'S INDEMNITY.............................................     68
         10.13 RESIGNATION OR REMOVAL OF ADMINISTRATIVE AGENT...................................................     68

SECTION 11 TRANSFERS AND ASSIGNMENTS............................................................................     69
         11.1 TRANSFER OF COMMITMENTS...........................................................................     69
                  (a) PRIOR CONSENT.............................................................................     69
                  (b) WITHHOLDING TAX EXEMPTION.................................................................     69
                  (c) AGREEMENT; TRANSFER FEE...................................................................     69
                  (d) NOTES.....................................................................................     70
                  (e) PARTIES...................................................................................     70
         11.2 SALE OF PARTICIPATIONS............................................................................     70
                  (a) PRIOR CONSENT.............................................................................     70
                  (b) BENEFITS OF PARTICIPANT...................................................................     71
                  (c) RIGHTS RESERVED...........................................................................     71
                  (d) NO DELEGATION.............................................................................     71
         11.3 CONFIDENTIALITY...................................................................................     71

SECTION 12 INDEMNITIES..........................................................................................     72
         12.1 INCREASED COSTS...................................................................................     72
         12.2 RISK-BASED CAPITAL................................................................................     72
</TABLE>

                                       v

<PAGE>

<TABLE>
<CAPTION>
Section                                                                                                             Page
-------                                                                                                             ----
<S>                                                                                                                 <C>
         12.3 TAXES.............................................................................................     72
                  (a) TAXES; WITHHOLDING........................................................................     72
                  (b) STAMP TAXES...............................................................................     73
                  (c) INDEMNIFICATION FOR OTHER TAXES...........................................................     73
                  (d) REQUEST FOR REFUND........................................................................     74
                  (e) EXEMPTION CERTIFICATE.....................................................................     74
                  (f) FURNISHING OF CERTIFICATE.................................................................     75
                  (g) SURVIVAL OF PROVISION.....................................................................     75
         12.4 LOSSES............................................................................................     75
         12.5 INDEMNIFICATION FOR REQUESTS......................................................................     75
         12.6 GENERAL INDEMNITY.................................................................................     76
         12.7 ENVIRONMENTAL INDEMNITY...........................................................................     76
         12.8 CERTIFICATE FOR INDEMNIFICATION...................................................................     76
         12.9 DUTY TO MITIGATE; STANDARD TREATMENT..............................................................     77

SECTION 13 GENERAL..............................................................................................     77
         13.1 AMENDMENTS AND WAIVERS............................................................................     77
         13.2 GENERAL ATTORNEY-IN-FACT..........................................................................     77
                  (a) ADMINISTRATIVE AGENT NOT LIABLE...........................................................     78
                  (b) AUTHORITY TO EXECUTE TRANSFERS............................................................     78
         13.3 PERFORMANCE BY ADMINISTRATIVE AGENT OF THE BORROWER'S OBLIGATIONS.................................     78
         13.4 JUDGMENTS; CONVERSION OF CURRENCIES...............................................................     79
                  (a) CONVERSION................................................................................     79
                  (b) DISCHARGE.................................................................................     79
         13.5 CONTINUITY CLAUSE - EURO..........................................................................     79
         13.6 CUMULATIVE PROVISIONS; INTEGRATION................................................................     79
         13.7 BINDING EFFECT....................................................................................     80
         13.8 COSTS AND EXPENSES................................................................................     80
         13.9 SURVIVAL OF PROVISIONS............................................................................     80
         13.10 CAPTIONS.........................................................................................     80
         13.11 INTEREST RATE LIMITATION.........................................................................     80
         13.12 ILLEGALITY.......................................................................................     81
         13.13 NOTICES..........................................................................................     81
         13.14 GOVERNING LAW....................................................................................     81
         13.15 ENTIRE AGREEMENT.................................................................................     81
         13.16 WAIVER OF SOVEREIGN IMMUNITY.....................................................................     82
         13.17 JURY TRIAL WAIVER................................................................................     82
         13.18 JURISDICTION; VENUE; INCONVENIENT FORUM..........................................................     82
                  (a) JURISDICTION..............................................................................     82
                  (b) VENUE; INCONVENIENT FORUM.................................................................     83
         13.19 EXECUTION IN COUNTERPARTS........................................................................     83

</TABLE>

                                       vi

<PAGE>

Section                                                                     Page

                              EXHIBITS AND ANNEXES

Exhibit A-1           (Form of Revolving Credit Note)
Exhibit A-2           (Form of Term Note)
Exhibit B-1           (Form of Credit Request)
Exhibit B-2           (Form of Letter of Credit Request)
Exhibit C             (Form of Rate Conversion/Continuation Request)
Exhibit D             (Form of Master Letter of Credit Agreement)
Exhibit E             (Form of Guaranty Agreement)
Exhibit F-1           (Form of Pledge Agreement- International)
Exhibit F-2           (Form of Pledge Agreement - ERICO Products)
Exhibit F-3           (Form of Pledge Agreement - Europa)
Exhibit G-1           (Form of Landlord Waiver)
Exhibit G-2           (Form of Bailee/Warehouseman/Consignee Waiver)
Exhibit G-3           (Form of Mortgagee Waiver)
Exhibit G-4           (Form of Consignee Notice)
Exhibit H-1           (Form of Supplemental Open-End Mortgage and Assignment)
Exhibit H-2           (Form of Amendment and Assignment to Deed of Trust)
Exhibit I             (Form of Existing Syndicate Assignment, Reallocation and
                        Acceptance Agreement)
Exhibit J             (Form of Subordination Agreement)
Exhibit K             (Form of Assignment Agreement)
Exhibit L             (Form of Advertising Permission Letter)

Annex I               Commitments Conditions
Annex II              Definitions
Annex III             Conditions Precedent to Restatement
Annex VI              Supplemental Schedule
Annex V               Additional Borrower Addendum
Annex VI              Interim Waiver of Certain Closing Conditions

                                      vii

<PAGE>

                           SECOND AMENDED AND RESTATED
                   MULTICURRENCY CREDIT AND SECURITY AGREEMENT

                               (U.S. $120,000,000)

                          DATED AS OF DECEMBER 2, 2002

         ERICO INTERNATIONAL CORPORATION, an Ohio corporation, ERICO PRODUCTS,
INC., an Ohio corporation and ERICO EUROPA B.V., a corporation organized under
the laws of the Netherlands, the BANKS listed on the signature pages of this
Agreement, LASALLE BANK NATIONAL ASSOCIATION, a national banking association, as
Administrative Agent for the Banks and Lead Arranger under this Agreement, and
LASALLE BANK NATIONAL ASSOCIATION, as Issuing Bank, GENERAL ELECTRIC CAPITAL
CORPORATION, as Co-Lead Arranger and Co-Documentation Agent, NATIONAL CITY BANK,
as Syndication Agent, and KEYBANK NATIONAL ASSOCIATION, as Documentation Agent
hereby agree as follows:

SECTION 1         DEFINITIONS AND ACCOUNTING TERMS.

         1.1      RESTATEMENT OF CREDIT FACILITIES.

                  This Second Amended and Restated Multicurrency Credit and
Security Agreement: (a) restates that certain Amended and Restated Multicurrency
Credit and Security Agreement, dated as of May 2, 2002, among the Borrowers
which were then parties thereto, National City Bank, as the Administrative Agent
thereunder, LaSalle Bank National Association as Syndication Agent thereunder,
General Electric Capital Corporation, as Documentation Agent thereunder, the
Banks that were signatories thereto, and the Issuing Banks thereunder, as
amended by that certain Waiver Letter and Amendment No. 1 to Amended and
Restated Multicurrency Credit and Security Agreement, dated as of September 10,
2002 (as so amended, the "Original Credit Agreement"). The Loan Documents and
other deliverables delivered pursuant to the requirements of Annex III to the
Original Credit Agreement and any and all waivers set forth in the
above-referenced Amendment to the Multicurrency Credit and Security Agreement,
remain effective except to the extent amended or restated pursuant to the
requirements of Annex III attached hereto.

         1.2      CERTAIN DEFINED TERMS.

                  Certain capitalized terms used in this Agreement are defined
on Annex II attached hereto and incorporated herein by reference.

         1.3      COMPUTATION OF TIME PERIODS.

                  In this Agreement in the computation of periods of time from a
specified date to a later specified date, the word "from" means "from and
including" and the words "to" and "until" each mean "to but excluding".

         1.4      ACCOUNTING TERMS.

                  All accounting and financial terms not specifically defined
herein shall be construed in accordance with GAAP as in effect from time to
time. In all cases, such accounting and financial terms shall be applied on a
basis consistent with those applied in the preparation of International and its
Subsidiaries' audited financial statements for the Fiscal Year ending December
31, 2001; provided that all financial statements shall reflect the adoption of
FAS 106. Notwithstanding the foregoing, for purposes of determining satisfaction
of the financial tests set

<PAGE>

forth in Sections 2.12 and 2.13 of this Agreement and compliance with any
covenant set forth in Section 6.4 of this Agreement, such terms shall be
construed in accordance with GAAP as in effect from time to time. If at any time
any change in GAAP would affect the computation of any financial ratio or
requirement set forth in any Loan Document, and either the Borrowers or the
Required Banks shall so request, the Banks and the Borrowers shall negotiate in
good faith to amend such ratio or requirement to preserve the original intent
thereof in light of such change in GAAP (subject to the approval of the Required
Banks); provided that, until so amended (i) such ratio or requirement shall
continue to be computed in accordance with GAAP prior to such change therein and
(ii) the Borrowers shall provide to the Banks financial statements and other
documents required under this Agreement or as reasonably requested hereunder
setting forth a reconciliation between calculations of such ratio or requirement
made before and after giving effect to such change in GAAP.

         1.5      CURRENCY EQUIVALENTS.

                  Not later than 11:00 a.m., central time, on the date (a) of
each Borrowing denominated in an Alternate Currency and of any Rate Conversion
or Rate Continuation thereof, (b) of the issuance or renewal of each Letter of
Credit denominated in an Alternate Currency and (c) on any other month-end date
that the Administrative Agent deems appropriate (each a "Reset Date"), the
Administrative Agent shall determine the Dollar Equivalents of each Alternate
Currency Advance and each Letter of Credit denominated in an Alternate Currency
then outstanding (after giving effect to any Alternate Currency Advance made or
repaid on such date) and notify International and the Banks of the results of
such determination. For purposes of this Agreement, except as otherwise
specified herein, the equivalent in Dollars of any Alternative Currency shall be
determined by using the quoted spot rate at which the Administrative Agent
offers to exchange Dollars for such Alternative Currency at its Payment Office
at 9:00 A.M. (local time at the Payment Office) two Business Days prior to the
date on which such equivalent is to be determined. For the purposes of Section 2
of this Agreement, the determination made in accordance with clause (a), (b) or
(c) of the first sentence of this Section 1.5 shall be deemed to remain in
effect with respect to each Advance comprising a particular Borrowing and with
respect to each Letter of Credit denominated in an Alternate Currency, until the
first Business Day after the Reset Date and thereafter until the next Reset
Date. Each reference herein to an amount stated in Dollars shall be a reference
to Dollars or the Dollar Equivalent of such amount unless the context dictates
otherwise. Each reference herein to an amount stated in an Alternate Currency
shall be a reference to the Dollar Equivalent of such Alternate Currency if the
context so requires.

         1.6      ADDITION OF BORROWERS.

                  By execution of an Additional Borrower Addendum by a signatory
thereto, and upon acceptance of such Additional Borrower Addendum by the
Administrative Agent and each of the Loan Parties, in their sole discretion, and
such signatory's satisfaction of all conditions and completion of deliveries
specified in such Additional Borrower Addendum, this Agreement shall be deemed
amended so that such signatory shall become for all purposes a party to this
Agreement as if an original signatory hereto and shall be admitted as a Borrower
hereunder. Except to the extent this Agreement is expressly amended by the
Additional Borrower Addendum in respect to such signatory Borrower, this
Agreement shall be binding for all purposes upon such signatory Borrower as if
an original signatory thereto. Unless otherwise agreed to in the Additional
Borrower Addendum, the Obligations of such signatory Borrower shall be
cross-defaulted with each other Borrower and if such signatory Borrower shall
become a Pledging Borrower, such Pledging Borrower's Obligations shall be
cross-collateralized with the Obligations of each other Pledging Borrower.

                                       2

<PAGE>

         1.7      AUTHORIZATION OF BORROWER REPRESENTATIVE TO MAKE REQUESTS.

                  For purposes of Sections 2.2, 2.9(d), 2.9(e), 2.10 and 2.11(d)
of this Agreement, each of the Borrowers hereby: (i) authorizes the Borrower
Representative to make such request or give such notices as may be required by
such Sections for the benefit of all or any of the Borrowers and (ii) authorizes
the Administrative Agent to treat such requests or notices given or made by the
Borrower Representative as being requests or notices given or made by such
Borrower for purposes of such Sections. Unless otherwise agreed to by the
Administrative Agent, the Borrower Representative shall be the only Borrower
entitled to give such notices or make such requests directly to the
Administrative Agent for purposes of the above-referenced Sections of this
Agreement. Each Borrower agrees to be bound by all notices and requests and
other such actions by the Borrower Representative.

         1.8      CONSTRUCTION OF TERMS GENERALLY.

                  The definitions of terms in this Agreement shall apply equally
to the singular and plural forms of the terms defined. Whenever the context
requires, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include," "includes," and "including," shall be deemed
to be followed by the phrase "without limitation." The word "will" shall be
construed to have the same meaning as the word "shall." Unless the context
otherwise requires, (a) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument, or other document as from time to time amended,
supplemented or otherwise modified (subject to any restriction on such
amendments, supplements or modifications as may be set forth herein), (b) any
reference herein to any Person shall be construed to include such Person's
successors and assigns, (c) the words "herein," "hereof," and "hereunder," and
words of similar import, shall be construed to refer to this Agreement in its
entirety and not any particular provision hereof, (d) all references to
sections, Annexes and Exhibits shall be construed to refer to sections of, and
Annexes and Exhibits to, this Agreement, and (e) unless the context or the
provisions of this Agreement otherwise indicate, the words "assets" and
"property" shall be construed to have the same meaning and effect and to refer
to any and all real property, and tangible and intangible assets and properties,
including cash, securities, accounts and contract rights and interests in any of
the foregoing.

         1.9      LIABILITY OF BORROWERS.

                  The parties intend that this Agreement shall in all
circumstances be interpreted to provide that each Foreign Borrower is liable
only for Loans made to such Foreign Borrower, interest on such Loans, such
Foreign Borrower's guaranty pursuant to reimbursement obligations owing to the
Issuing Banks by its Foreign Subsidiaries, and its Ratable Borrower Share of
otherwise unallocated general fees, reimbursements and charges hereunder and
under any other Loan Document. The parties likewise intend that this Agreement
shall in all circumstances be interpreted to provide, unless otherwise expressly
stated to the contrary, that each Pledging Borrower and each Substantial
Guarantor is liable for all Obligations of all of the Borrowers.

                                       3

<PAGE>

SECTION 2         STATEMENT OF TERMS.

         2.1      REVOLVING CREDIT FACILITY.

                  (a)      REVOLVING CREDIT ADVANCES.

                           Subject to the terms and conditions set forth in this
         Agreement, each Bank severally agrees to make, from time to time on and
         after the Restatement Date and up to but excluding the Business Day
         immediately preceding the Termination Date, Revolving Credit Advances
         to each of the Borrowers; provided, however, that, subject to Section
         1.5 hereof, the outstanding principal amount of Revolving Credit
         Advances made by or on behalf of such Bank to such Borrower, when taken
         together with the outstanding principal amount of all Revolving Credit
         Advances made by or on behalf of such Bank to all of the Borrowers,
         shall not exceed the amount of such Bank's Revolving Credit Commitment
         for all Borrowers in effect at such time minus the LC Exposure of such
         Bank in respect of all of the Borrowers at such time. Within the limits
         set forth herein, a Borrower may borrow, prepay and reborrow Revolving
         Credit Advances.

                  (b)      REVOLVING CREDIT BORROWINGS.

                           Each Revolving Credit Advance to a Borrower shall be:
         (i) if an Alternate Base Rate Borrowing, in an aggregate amount of not
         less than One Hundred Thousand Dollars ($100,000), (ii) if a LIBOR
         Borrowing denominated in Dollars, in an aggregate amount of not less
         than One Million Dollars ($1,000,000) or an integral multiple of One
         Hundred Thousand Dollars ($100,000) in excess thereof and (iii) if a
         LIBOR Borrowing denominated in an Alternate Currency, in an aggregate
         amount of not less than the Dollar Equivalent of One Million Dollars
         ($1,000,000). Each Borrowing denominated in an Alternate Currency shall
         only be a LIBOR Borrowing and not an Alternate Base Rate Borrowing.
         Each Borrower shall be entitled to have more than one LIBOR Borrowing
         outstanding at one time; provided, however, that such Borrower shall
         not be entitled to request any LIBOR Borrowing which, together with all
         outstanding Revolving Credit Borrowings and Term Borrowings to all
         Borrowers (treating outstanding Alternate Base Rate Advances as a
         single Borrowing for purposes of determining outstanding Borrowings),
         would result in an aggregate of more than twenty (20) LIBOR Borrowings
         outstanding at any one time.

                  (c)      REVOLVING CREDIT NOTES; LOAN ACCOUNT.

                           Each Bank's Revolving Credit Advance to a Borrower
         shall be evidenced at all times by a Revolving Credit Note executed and
         delivered by such Borrower, payable to the order of such Bank and in a
         principal amount equal to the amount of such Bank's Revolving Credit
         Commitment in effect at the execution and delivery of such Bank's
         Revolving Credit Note. Whenever a Borrower obtains a Revolving Credit
         Advance, each Bank may endorse an appropriate entry on such Bank's
         Revolving Credit Note or make an appropriate entry in a loan account or
         subaccount (the "Loan Account") which may be maintained in such Bank's
         books and records, or both, to evidence such Bank's Revolving Credit
         Advances comprising part of a Revolving Credit Borrowing to a Borrower.
         The Loan Account (which shall be maintained so as to have within such
         Loan Account specific subaccounts for each Borrower therein) shall also
         evidence: (i) accrued interest on the Revolving Credit Advances of such
         Bank to each Borrower, (ii) all other amounts due to such Bank in
         respect of such Revolving Credit Advances and (iii) all payments made
         by each Borrower received by such Bank from the Administrative Agent
         for application to such Revolving Credit Borrowings. Each entry on such
         Bank's Revolving Credit Note or in such Bank's books and records or
         Loan Account shall be

                                       4

<PAGE>

         prima facie evidence of the data entered. Such entries shall not be a
         condition to any Borrower's obligation to repay the Obligations.

                           (i)      CONTROL ACCOUNT MAINTAINED BY ADMINISTRATIVE
                  AGENT. The Administrative Agent shall maintain on its books
                  and records a control account (the "Control Account") in
                  respect of each Borrower and the Revolving Credit Borrowings
                  hereunder in which the Administrative Agent shall record: (i)
                  advances of Revolving Credit Borrowings to such Borrower, (ii)
                  the Ratable Portion of each Bank in the outstanding Revolving
                  Credit Borrowings, (iii) the amounts of any Collections and
                  Remittances, if any, received and credited to reduce the
                  Revolving Credit Advances and (iv) the Ratable Portion of each
                  Bank in such credited Collections and Remittances. Each entry
                  by the Administrative Agent in the Control Account shall be
                  prima facie evidence of the data entered.

         2.2      CREDIT REQUESTS.

                  Each Revolving Credit Advance shall be made upon request of a
Borrower in accordance with clause (a) below or upon a request deemed to be made
pursuant to clause (b) below:

                  (a)      CREDIT REQUESTS EXECUTED BY BORROWERS.

                           Requests for Revolving Credit Advances comprising a
         Revolving Credit Borrowing shall be given by the Borrower
         Representative to the Administrative Agent not later than 12:00 p.m.
         (central time): (i) on the Business Day which is the specified date of
         a requested Revolving Credit Advance which is an Alternate Base Rate
         Borrowing (Revolving Credit Advances made on the Restatement Date may
         only be Alternate Base Rate Advances), (ii) on the Business Day which
         is three (3) Business Days before the specified date of a requested
         Revolving Credit Advance which is a LIBOR Borrowing denominated in
         Dollars and (iii) on the Business Day which is four (4) Business Days
         before the specified date of a requested Revolving Credit Advance which
         is a LIBOR Borrowing denominated in an Alternate Currency. Each such
         request (a "Credit Request") for a Revolving Credit Advance shall be a
         written or telephonic notice (in the case of a telephonic notice,
         promptly confirmed in writing if so requested by the Administrative
         Agent). Each written Credit Request or written confirmation thereof
         shall be substantially the form of Exhibit B-1 attached hereto, signed
         by the Borrower Representative and transmitted by the Borrower
         Representative to the Administrative Agent by telecopier. Each written
         and telephonic Credit Request and each confirmation thereof shall
         specify: (a) the Borrower which is to receive the proceeds of the Loans
         (B) the requested date of the Revolving Credit Advances, (C) the
         aggregate amount of such Revolving Credit Advances, (D) whether such
         Revolving Credit Borrowing is an Alternate Base Rate Borrowing or LIBOR
         Borrowing denominated in Dollars or a LIBOR Borrowing denominated in an
         Alternate Currency, (E) in the case of a requested LIBOR Borrowing
         denominated in an Alternate Currency, the currency to be borrowed and
         (F) in the case of any proposed LIBOR Borrowing, the initial Interest
         Period for such LIBOR Borrowing. Each Credit Request by or on behalf of
         a Borrower shall be irrevocable and binding on such Borrower and
         subject to the indemnification provisions of Section 12 of this
         Agreement. The Administrative Agent may rely on a telephonic Credit
         Request to the same extent that the Administrative Agent may rely on a
         written Credit Request. A Borrower shall bear all risks related to the
         giving of a Credit Request by or on behalf of such Borrower whether
         given telephonically or by such other method of transmission as such
         Borrower shall elect.

                                       5

<PAGE>

                  (b)      REQUESTS FOR REVOLVING CREDIT BORROWING DEEMED GIVEN.

                           A Borrower shall be deemed to have made a request for
         a Borrowing (a "Deemed Credit Request"), which Deemed Credit Request
         shall be deemed to be irrevocable, upon the occurrence of any of the
         following and the Banks agree that on the specified date of such
         occurrence, the Banks will make the requested Advances pursuant to the
         Deemed Credit Request and that the Banks' obligation to make such
         Advances is absolute and unconditional and shall not be affected by any
         event or circumstance whatsoever, including the occurrence of any
         Potential Default or Event of Default hereunder or the failure of any
         condition precedent set forth in Section 3 of this Agreement to be
         satisfied and each such payment shall be made without any offset,
         abatement, withholding or reduction whatsoever:

                           (i)      LETTER OF CREDIT DRAWING. As specified in
                  Section 2.11(g) of this Agreement, upon a drawing under a
                  Letter of Credit, International shall be deemed to have made a
                  request for either (a) an Alternate Base Rate Borrowing, in
                  the case of a Letter of Credit denominated in Dollars or (B) a
                  LIBOR Borrowing, in the case of a Letter of Credit denominated
                  in an Alternate Currency in an amount equal to the amount
                  necessary either to reimburse the Issuing Bank for such
                  drawing upon the Letter of Credit together with accrued
                  interest thereon or, if reimbursement of the Issuing Bank is
                  made by the Banks for any reason, reimburse the Banks for such
                  payment.

                           (ii)     PAYMENT OF INTEREST AND OBLIGATIONS. Unless
                  payment is otherwise made by the Borrowers, upon any such
                  interest or fee hereunder becoming due without payment by the
                  Borrowers, the Borrowers shall be deemed to have made a
                  request for either (A) an Alternate Base Rate Borrowing, in
                  the case of amounts due in Dollars or (B) a LIBOR Borrowing,
                  in the case of amounts due in an Alternate Currency, in an
                  amount equal to the amount necessary to pay such interest or
                  fee.

         2.3      FUNDING OF REVOLVING CREDIT ADVANCES.

                  The Administrative Agent shall notify each Bank of a Credit
Request no later than 2:00 p.m. (central time) on the date received by
telecopier, telephone or similar form of transmission. Each Bank shall, before
4:00 p.m. (central time) on the date a Revolving Credit Borrowing is requested,
make available to the Administrative Agent, in immediately available funds at
the account of the Administrative Agent maintained at the Payment Office as
shall have been notified by the Administrative Agent to the Banks prior to such
date, such Bank's Ratable Portion of the Revolving Credit Advances comprising
such Revolving Credit Borrowing. On the date specified for a Revolving Credit
Borrowing in such Credit Request, after the Administrative Agent's receipt of
the funds representing a Bank's Ratable Portion of such Revolving Credit
Borrowing and subject to the terms of this Agreement and the applicable
Borrower's fulfillment of the conditions set forth in Section 3 of this
Agreement, the Administrative Agent will make such Revolving Credit Advance of
such Bank available to such Borrower in immediately available funds, by wire
transfer or intrabank transfer to: (A) the Operating Account or (B) such other
account of such Borrower as the Administrative Agent and the Borrower shall have
agreed upon from time to time for this purpose; provided, however, that, if a
Borrowing shall not occur on such date because any condition precedent herein
specified shall not have been met, the Administrative Agent shall return the
amounts so received to the respective Banks.

                                       6

<PAGE>

         2.4      AVAILABILITY OF FUNDS.

                  Unless the Administrative Agent shall have received notice
from a Bank prior to the date (or, in the case of Alternate Base Rate Advances,
prior to the time) of any Revolving Credit Borrowing that such Bank will not
make available to the Administrative Agent such Bank's Ratable Portion of the
Revolving Credit Borrowing, the Administrative Agent may assume that such Bank
has made its Ratable Portion of the Revolving Credit Borrowing available to the
Administrative Agent on the date of the Revolving Credit Borrowing in accordance
with Section 2.3 of this Agreement. In reliance upon such assumption, the
Administrative Agent may, but shall not be obligated to, make available to the
Borrower on such date, a corresponding portion of the Revolving Credit
Borrowing. Any disbursement by the Administrative Agent in reliance on such
assumption shall be deemed to be a Revolving Credit Advance by such Bank.

         2.5      AFFILIATED FUNDING THROUGH, ON BEHALF OF, OR BY BANKS.

                  (a)      SPV FUNDING ON BEHALF OF BANKS.

                           Notwithstanding anything to the contrary contained
         herein, all or any part of a Loan that any Bank (an "Obligated Bank")
         may be obligated to fund pursuant to this Agreement may be funded on
         such Bank's behalf by a special purpose funding vehicle (an "SPV");
         provided, however, that, (a) if any SPV fails to fund all or any part
         of such Loan, the Obligated Bank shall be obligated to fund such Loan
         pursuant to the terms hereof, (b) in no event shall any such funding by
         any SPV increase the costs or expenses for which any Borrower is liable
         under this Agreement and (c) in no event shall any such funding through
         any SPV subject any Borrower to any Taxes or other Taxes without such
         Obligated Bank's being subject to the exercise by the Borrowers of
         their rights under Section 11.2 of this Agreement. The funding of a
         Loan by an SPV hereunder shall utilize the Commitment of the Obligated
         Bank to the same extent, and as if, such Loan were funded by such
         Obligated Bank, and for purposes of this Agreement, such Loan shall be
         deemed to have been made by such Obligated Bank. Each party hereto
         hereby agrees that: (i) no SPV shall be liable for any indemnity or
         payment under this Agreement for which such Obligated Bank would
         otherwise be liable and (ii) the SPV shall act only on behalf of and
         through the Obligated Bank and shall have no rights hereunder or
         otherwise with respect to any Borrower independent of those of such
         Obligated Bank hereunder. Notwithstanding anything to the contrary
         contained in this Agreement, any SPV may disclose on a confidential
         basis any non-public information relating to its funding of Loans to
         any rating agency, commercial paper dealer or provider of any surety or
         guarantee for such SPV's obligations which has agreed in writing to be
         bound by the provisions of Section 11.3 hereof. This Section 2.5 may
         not be amended without the prior written consent of each Obligated Bank
         which has notified Borrower Representative and the Administrative Agent
         that all or any part of any of its Loans is being funded by an SPV at
         the time of such amendment.

                  (b)      FUNDING BY BANKS AND ISSUING BANKS ISSUERS THROUGH OR
                           ON BEHALF OF LENDING INSTALLATIONS.

                           Notwithstanding anything to the contrary contained
         herein, all or any part of a Loan that any Obligated Bank may be
         obligated to fund pursuant to this Agreement (i) may be funded by such
         Bank on behalf of such Bank's Lending Installation or (ii) may be
         funded on such Bank's behalf by such Bank by and through any such
         Lending Installation; provided that, (a) if any Lending Installation
         fails to fund all or any part of such Loan, the Obligated Bank shall be
         obligated to fund such Loan pursuant to the terms hereof, (b) in no
         event shall any such funding by any Lending Installation increase the

                                       7

<PAGE>

         costs or expenses for which any Borrower is liable under this Agreement
         and (c) in no event shall any such funding on behalf of or through any
         such Lending Installation subject any Borrower to any Taxes or other
         Taxes without such Obligated Bank's being subject to the exercise by
         the Borrowers of their rights under Section 11.2 of this Agreement. The
         funding of a Loan by a Lending Installation hereunder shall utilize the
         Commitment of the Obligated Bank to the same extent, and as if, such
         Loan were funded by such Obligated Bank, and for purposes of this
         Agreement, such Loan shall be deemed to have been made directly by such
         Obligated Bank. The funding of a Loan by such Lending Installation on
         behalf of its Obligated Bank hereunder shall utilize the Revolving
         Credit Commitment of the Obligated Bank to the same extent, and as if,
         such Loan were funded by such Obligated Bank for its own account, and
         for purposes of this Agreement, such Loan shall be deemed to have been
         made by such Obligated Bank for the account of the Obligated Bank. Any
         payments made by any Borrower to the Obligated Bank or its Lending
         Installation shall be applied in reduction of the Obligations owing by
         such Borrower to the Obligated Bank and shall automatically reduce on
         dollars for dollar any related account of the Lending Installation with
         respect to such Obligations to the Obligated Bank. Each party hereto
         hereby agrees that the Lending Installation shall have no rights
         hereunder or otherwise with respect to any Borrower independent of
         those of such Obligated Bank hereunder but shall by reason of its
         acceptance of its selection as a Lending Installation, otherwise be
         deemed subject to the terms and conditions hereof. This Section 2.5 may
         not be amended without the prior written consent of each Obligated Bank
         which has notified Borrower Representative and the Administrative Agent
         that all or any part of any of its Loans is being funded on such Bank's
         behalf through a Lending Installation at the time of such amendment.

         2.6      TERM FACILITY.

                  (a)      TERM ADVANCES.

                           Subject to the terms and conditions of this
         Agreement, on the Restatement Date, each Bank severally agrees to make
         an Advance on a term basis (the "Term Advance") to the Borrowers in the
         amount specified on Annex I in respect to such Bank. The Term Advance
         of each Bank shall be comprised of one or more Term Borrowings, as the
         Borrowers may elect from time to time by delivery to the Administrative
         Agent by the Borrower Representative of a Rate Conversion/Continuation
         Request pursuant to Section 2.10 of this Agreement.

                  (b)      TERM BORROWINGS.

                           Each Term Borrowing shall be: (i) with respect to
         Alternate Base Rate Advances, in an aggregate amount of not less than
         Five Hundred Thousand Dollars ($500,000) and (ii) with respect to LIBOR
         Advances, in an aggregate amount of not less than One Million Dollars
         ($1,000,000) or an integral multiple of Two Hundred and Fifty Thousand
         Dollars ($250,000) in excess thereof. The Borrowers shall be entitled
         to have more than one Term Borrowing outstanding at one time; provided,
         however, that the Borrowers shall not be entitled to request any Term
         Borrowing which, together with all outstanding Revolving Credit
         Borrowings and Term Borrowings to all Borrowers, would result in any
         Bank's having an aggregate of more than twenty (20) Borrowings
         (treating outstanding Alternate Base Rate Advances as a single
         Borrowing for purposes of determining outstanding Borrowings)
         outstanding at any one time to all of the Borrowers.

                                       8

<PAGE>

                  (c)      TERM NOTES.

                           Each Bank's Term Advance shall be evidenced by and
         repayable in accordance with a Term Note which shall: (i) be executed
         and delivered by the Borrowers (other than Europa), payable to the
         order of such Bank and (ii) be in a principal amount equal to the
         amount of such Bank's Term Advance; provided, however, that, in the
         absence of the Term Note, the Term Advance shall be evidenced by the
         Bank's records of disbursements and repayments, which records shall be,
         absent manifest error, prima facie evidence of the Obligations of the
         Borrowers in respect of such Term Advance.

                  (d)      AMORTIZATION AND MATURITY OF TERM ADVANCES.

                           The Term Advance of each Bank shall be repaid by the
         Borrowers to the Administrative Agent for the benefit of the Banks in
         twenty (20) quarterly installments of principal payable on the last day
         of each December, March, June and September of each calendar year as
         follows: (i) during the period commencing with March 31, 2003 and
         ending with and including December 31, 2003, each installment shall be
         in a principal amount equal to such Bank's Ratable Portion of One
         Million Five Hundred Thousand Dollars ($1,500,000), payable together
         with interest thereon, and (ii) during the period commencing with March
         31, 2004 and ending with and including September 30, 2007, each
         installment shall be in a principal amount equal to such Bank's Ratable
         Portion of Two Million Four Hundred Thirty-Seven Five Hundred Dollars
         ($2,437,500), payable together with interest thereon, and (iii), on
         December 2, 2007, a final installment in a principal amount equal to
         such Bank's Ratable Portion of Two Million Four Hundred Thirty-Seven
         Thousand Five Hundred Dollars ($2,437,500), payable together with
         interest thereon, or such greater or lesser amount as is required to
         bring the principal of the Term Advance to zero (0) (with each of such
         referenced repayment dates being a "Term Advance Repayment Date").

         2.7      FUNDING OF TERM ADVANCES BY BANKS.

                  Each Bank shall, prior to 1:00 P.M. (central time) on the
Restatement Date, make available to the Administrative Agent, in immediately
available funds at the account of the Administrative Agent maintained at the
Payment Office as shall have been notified by the Administrative Agent to the
Banks prior to such date, the portion of the amount specified in Annex I in
respect of such Bank which has not been previously funded on the Restatement
Date.

                  (a)      DISBURSEMENT OF TERM FUNDS RECEIVED.

                           Upon the Administrative Agent's receipt of funds on
         the Restatement Date representing a Bank's Term Advances, and subject
         to the terms of this Agreement and the fulfillment of the conditions
         set forth in Section 3 of this Agreement, the Administrative Agent
         shall make such remaining portion of the Term Advance of such Bank
         available to the Borrowers in immediately available funds, by wire
         transfer or intrabank transfer: (A) to the Operating Account or (B)
         such other account of the Borrowers as the Administrative Agent and the
         Borrower Representative shall have agreed upon from time to time;
         provided, however, that, if the Term Advance shall not occur on such
         date because any condition precedent herein specified shall not have
         been met, the Administrative Agent shall return the amounts so received
         to the respective Banks.

                  (b)      AVAILABILITY OF TERM ADVANCE FUNDS.

                           Unless the Administrative Agent shall have received
         notice from a Bank on the Restatement Date that such Bank will not make
         available to the Administrative

                                       9

<PAGE>

         Agent the unfunded portion of such Bank's Term Advance on the
         Restatement Date, the Administrative Agent may assume prior to receipt
         of funds from such Bank that such Bank has made its Term Advance
         available to the Administrative Agent on the Restatement Date. In
         reliance upon such assumption, the Administrative Agent may, but shall
         not be obligated to, make available to the Borrowers funds equal to
         such unfunded portion of such Bank's Term Advance. Any disbursement by
         the Administrative Agent in reliance on such assumption shall be deemed
         to be the advance by such Bank of its Term Advance.

         2.8      FAILURE OF BANK TO FUND.

                  If and to the extent that any Bank shall not have made
available to the Administrative Agent such Bank's Ratable Portion of any
Revolving Credit Borrowing (pursuant to either Section 2.3 of this Agreement or
pursuant to Section 2.11(g) hereof in connection with Deemed Credit Requests for
Revolving Credit Advances to pay unpaid reimbursement obligations for Letters of
Credit hereunder) or any Term Advance pursuant to Section 2.6 hereof, or any
Bank fails to make available to the Administrative Agent the amount of such
Bank's participation purchase price payable for its participating interest in
the unpaid reimbursement obligations with respect to Letters of Credit pursuant
to Section 2.11(g) hereof, such Bank shall pay such amount to the Administrative
Agent for application pursuant to this Section immediately upon demand by the
Administrative Agent. To the extent that such Bank does not pay such amount to
the Administrative Agent forthwith upon such demand by the Administrative Agent,
the Administrative Agent shall promptly request payment thereof from the
Borrower, and the Borrower shall immediately pay such amount that is actually
advanced to the Administrative Agent for application pursuant to this Section.
Such Bank and the Borrowers shall be severally liable to pay interest to the
Administrative Agent on such amount for each day from the date such amount
should otherwise have been made available to the Administrative Agent until the
date such amount is paid to the Administrative Agent by such Bank of the
Borrowers, at a per annum rate of interest equal to: (A) in the case of a Bank,
Federal Funds Rate and (B) in the case of the Borrower, the interest rate
applicable at the time to Alternate Base Rate Advances, or if such Advances are
denominated in an Alternate Currency, at the interest rate applicable at the
time to LIBOR Advances.

                  (a)      PAYMENT CONSTITUTING RATABLE PORTION.

                           If such Bank pays to the Administrative Agent the
         Bank's Ratable Portion of such Revolving Credit Borrowing or Term
         Borrowing or such Bank's participation purchase price, as the case may
         be, prior to repayment of such amount by the Borrower, the amount so
         repaid shall constitute such Bank's Ratable Portion of such Revolving
         Credit Borrowing or Term Borrowing or participation purchase price, as
         the case may be. In such circumstances, the Borrowers shall have no
         further obligation to make the payment required by this Section. Such
         payment shall be applied as if paid when otherwise required hereunder
         and shall be applied as provided in Sections 2.3 and 2.11(g) hereof, as
         the case may be.

                  (b)      CONTINUING BORROWER OBLIGATION.

                           Failure of any Bank to fund its Ratable Portion of
         any Borrowing or to pay any participation purchase price for its
         participating interest required hereunder shall not relieve or excuse
         the performance by the Borrower of any of its duties or obligations
         hereunder.

                                       10

<PAGE>

                  (c)      TREATMENT OF BANK FAILING TO FUND.

                           To the extent any Bank fails to make available to the
         Administrative Agent such Bank's Ratable Portion of Revolving Credit
         Borrowings or Term Borrowings hereunder or such Bank's participation
         purchase price for its participating interests in unpaid reimbursement
         obligation with respect to Letters of Credit hereunder, the
         Administrative Agent shall not be obligated to transfer to such Bank
         any payments made by the Borrowers to the Administrative Agent for the
         benefit of such Bank until the Bank has cured its failure. Until the
         earlier of such Bank's cure of its failure to fund or the termination
         of the Revolving Credit Commitments, all amounts repaid to the
         Administrative Agent by the Borrowers which would otherwise be required
         to be applied to such Bank's Ratable Portion of the Revolving Credit
         Advances or participation purchase price, as the case may be, shall be
         advanced to the Borrowers by the Administrative Agent on behalf such
         Bank to cure, in full or in part, the failure by such Bank to fund, but
         shall nevertheless be deemed to have been paid to such Bank in
         satisfaction of the Obligations to which such payment would otherwise
         have been applied. Notwithstanding anything contained herein to the
         contrary, no such Bank failing to fund shall have any voting or consent
         rights under or with respect to the Loan Documents or constitute a
         "Bank" (or be included in the calculation of "Required Banks"
         hereunder) for any voting or consent rights under or with respect to
         any Loan Document. The terms of this Section 2.8(c) shall: (i) remain
         effective with respect to such defaulting Bank until such time as the
         Bank failing to fund shall no longer be in default of any of its
         obligations under this Agreement and (ii) shall not relieve or excuse
         the performance by the Borrowers of any duties or obligations
         hereunder.

                  (d)      CONTINUING BANK OBLIGATION TO FUND.

                           It is understood that: (i) a Bank shall not be
         responsible for any failure by any other Bank to perform its obligation
         to make any Advances hereunder, (ii) the Revolving Credit Commitment of
         a Bank shall not be increased or decreased as a result of any failure
         by any other Bank to perform its obligation to make any Advances
         hereunder, (iii) failure by any Bank to perform its obligation to make
         any Advances hereunder shall not excuse any other Bank from its
         obligation to make any Advances hereunder, and (iv) the obligations of
         each Bank hereunder shall be several, not joint and several.

                  (e)      EFFECT OF BANK'S FAILURE TO FUND ON OBLIGATIONS OF
                           ISSUING BANK.

                           In the circumstance that any Bank fails to make
         available its Ratable Portion of Revolving Credit Borrowings hereunder
         or participation purchase price, the Issuing Bank shall not be required
         to issue Letters of Credit unless the Issuing Bank has entered into
         arrangements with the Borrowers satisfactory to the Issuing Bank and
         the Borrowers which either: (i) eliminate the Issuing Bank's risk with
         respect to the refunding of or participation in Letters of Credit by
         such defaulting Bank, including creation of a cash collateral account
         to assure payment of such defaulting Bank's Ratable Portion of
         outstanding LC Exposure or (ii) provide that the issuance of Letters of
         Credit hereunder, taking into account the potential failure of such
         defaulting Bank to refund or purchase participating interests therein,
         will not cause the Issuing Bank to incur aggregate credit exposure
         hereunder with respect to Revolving Credit Advances made thereby and LC
         Exposure owing thereto to be in excess of its Revolving Credit
         Commitment (the Borrowers agreeing not to incur Revolving Credit
         Advances and LC Exposure hereunder which would cause such aggregate
         excess exposure).

                                       11

<PAGE>

         2.9      REPAYMENTS; PREPAYMENTS; REDUCTION OF COMMITMENT.

                  (a)      REPAYMENT.

                           Each Borrower shall repay to the Administrative Agent
         for the account of the Banks the outstanding principal amount of the
         Revolving Credit Advances on the Termination Date. The Borrowers shall
         repay to the Administrative Agent for the account of the Banks the Term
         Advance in accordance with Section 2.6(d) of this Agreement and the
         Term Notes. Repayments of Advances denominated in Dollars shall be made
         in Dollars. Repayments of Advances denominated in an Alternative
         Currency shall be made in such Alternate Currency, together with
         interest thereon.

                  (b)      MANDATORY PREPAYMENT; CALCULATION.

                           (i)      PREPAYMENT OF EXCESS REVOLVING CREDIT
                  ADVANCES. If, on any Business Day, the aggregate Revolving
                  Credit Advances then outstanding plus the LC Exposure exceeds
                  the aggregate Revolving Credit Commitments of all of the
                  Banks, then the Borrowers shall on such day prepay to the
                  Administrative Agent for the account of the Banks an aggregate
                  principal amount of such Revolving Credit Advances in an
                  amount at least equal to such excess plus any amounts required
                  pursuant to Section 12.4 of this Agreement. For the purposes
                  of determining compliance with this Section 2.9(b), the Dollar
                  Equivalent in respect of any Advance denominated in an
                  Alternate Currency shall be determined by the Administrative
                  Agent in accordance with Section 1.5.

                  (c)      MANDATORY APPLICATION OF NET PROCEEDS; EXCESS CASH
                           FLOW RECAPTURE.

                           (i)      APPLICATION OF NET PROCEEDS. From and after
                  the Restatement Date, the Borrowers shall apply all Net
                  Proceeds promptly upon receipt thereof to prepay the Term
                  Advances outstanding at the time of such receipt with such
                  prepayments being applied: (A) first, to outstanding Term
                  Advances, applied pro rata across all of the installment
                  maturities of such Term Advances, and (B) second, to
                  outstanding Revolving Credit Loans; provided, however, that
                  nothing in this Subsection 2.9(c)(i) hereof or in the
                  definition of "Net Proceeds" shall constitute authorization
                  not otherwise permitted by this Agreement for the Borrowers to
                  enter into any transaction that would generate Net Proceeds.

                           (ii)     EXCESS CASH FLOW RECAPTURE. Not later than
                  one hundred twenty (120th) days following each Fiscal Year end
                  of the Borrowers, commencing with Fiscal Year ending 2003, the
                  Borrowers shall prepay the Term Advances and Revolving Credit
                  Advances outstanding at the time in an aggregate amount equal
                  to fifty percent (50.00%) of the Consolidated Excess Cash Flow
                  of the Borrowers for the immediately preceding Fiscal Year
                  with such prepayments being applied: (A) first, to outstanding
                  Term Advances, applied pro rata across all of the installment
                  maturities of such Term Advances, and (B) second, to
                  outstanding Revolving Credit Advances, provided, however, that
                  if the Consolidated Funded Debt to EBITDA Ratio and the
                  Consolidated Funded Debt to Consolidated Net Worth Ratio are
                  each less than 3.00 to 1.00 at the end of such Fiscal Year,
                  then no portion of such Consolidated Excess Cash Flow shall be
                  required to be applied to prepay the Terms Advances and the
                  Revolving Credit Advances.

                                       12

<PAGE>

                  (d)      REDUCTION OF REVOLVING CREDIT COMMITMENT.

                           Upon five (5) Business Days prior written notice to
         the Administrative Agent, the Borrower Representative may in accordance
         with the terms of this Agreement request that the Banks permanently
         reduce, in whole or in part, the aggregate Revolving Credit Commitment.
         Each reduction shall be subject to the following: (i) each such
         reduction shall be in an aggregate principal amount of not less than
         Five Million Dollars ($5,000,000) or a multiple of One Hundred Thousand
         Dollars ($100,000) in excess thereof, (ii) the Borrower Representative
         shall not be permitted to reduce the aggregate Revolving Credit
         Commitments unless, concurrently with any reduction, the Borrowers
         shall make principal payments on each Bank's then outstanding Revolving
         Credit Advances such that the sum of the Revolving Credit Advances plus
         the LC Exposure is no more than the Revolving Credit Commitment of such
         Bank as so reduced. Each reduction in the aggregate Revolving Credit
         Commitment hereunder shall be made among the Banks ratably in
         accordance with their Revolving Credit Commitments, as the case may be.
         On the date of each reduction, the Borrowers shall pay to the
         Administrative Agent for the account of the Banks (x) the facility fees
         and interest accrued through the date of such reduction in respect of
         the aggregate Revolving Credit Commitment and (y) any amounts required
         pursuant to the provisions of Section 12.4 of this Agreement. Any
         reduction in the Revolving Credit Commitment shall be a permanent
         reduction and no amount in excess of such reduced commitment may
         thereafter be borrowed or reborrowed.

                  (e)      PERMITTED PREPAYMENTS.

                           A Borrower may prepay all or any part of Term
         Advances or Revolving Credit Advances by giving notice through the
         Borrower Representative to the Administrative Agent for the account of
         the Banks stating the proposed date of prepayment, the Type of
         Borrowing being prepaid and the aggregate principal amount of the
         prepayment: (i) not later than 11:00 A.M. (central time) on any
         Business Day that is the proposed date of such prepayment, with respect
         to Alternate Base Rate Advances, (ii) not later than 11:00 A.M.
         (central time) on the third Business Day prior to the Business Day that
         is the proposed date of such prepayment, with respect to LIBOR Advances
         denominated in Dollars and (iii) not later than 11:00 A.M. (central
         time) on the fourth Business Day prior to the Business Day that is the
         proposed date of such prepayment, with respect to LIBOR Advances
         denominated in an Alternate Currency. If the notice to the
         Administrative Agent is in respect of the prepayment of Alternate Base
         Rate Advances, the Borrower shall, upon the giving of such notice,
         prepay the outstanding aggregate principal amount of the Alternate Base
         Rate Advances comprising part of the same Revolving Credit Borrowing in
         whole or ratably in part; provided, however, that each partial
         prepayment of Alternate Base Rate Advances shall be in the aggregate
         principal amount of not less than Fifty Thousand Dollars ($50,000). If
         the notice to the Administrative Agent is in respect of the prepayment
         of any LIBOR Advances, the Borrower shall, after giving such notice,
         prepay the outstanding aggregate principal amount of any LIBOR Advances
         comprising part of the same Revolving Credit Borrowing in whole or
         ratably in part, along with the accrued interest to the date of such
         prepayment on the principal amount of such Borrowing so prepaid;
         provided, however, that: (i) each partial prepayment of any LIBOR
         Advances shall be in an aggregate principal amount of not less than One
         Million Dollars ($1,000,000), or an integral multiple of One Hundred
         Thousand Dollars ($100,000) in excess thereof or the Dollar Equivalent
         thereof (iii) any prepayment of any LIBOR Advance made on a day other
         than the last day of an Interest Period shall obligate the Borrower to
         reimburse the Banks in respect thereof pursuant to Section 12.4 of this
         Agreement, and (iv) any permitted

                                       13

<PAGE>

         prepayment of the Term Advances made pursuant to this Section 2.9(e)
         shall be applied pro rata across all of the installment maturities of
         such Term Advances.

         2.10     RATE CONVERSION AND RATE CONTINUATION.

                  A Borrower shall have the right to convert all or any portion
of Revolving Credit Borrowing or Term Borrowings into, or continue all or any
portion of the Advances comprising any Borrowing as, LIBOR Advances or Alternate
Base Rate Advances, upon request delivered by the Borrower Representative for on
or behalf of any Borrower to the Administrative Agent not later than 11:00 A.M.
(central time): (a) on the Business Day that a Borrower desires to convert any
LIBOR Borrowing denominated in Dollars into an Alternate Base Rate Borrowing,
(b) three Business Days prior to the Business Day on which the Borrower desires
to convert any Alternate Base Rate Borrowing into LIBOR Borrowing denominated in
Dollars for a given Interest Period, (c) three Business Days prior to the
Business Day on which Borrower desires to continue any LIBOR Borrowing as a
LIBOR Borrowing, whether denominated in Dollars or an Alternate Currency, for an
additional Interest Period of the same duration, and (d) three Business Days
prior to the Business Day on which Borrower desires to convert any LIBOR
Borrowing having a particular Interest Period into a LIBOR Borrowing having a
different permissible Interest Period; provided, however, that each such Rate
Conversion or Rate Continuation shall be subject to the following:

                           (i)      each Rate Conversion or Rate Continuation
                  shall be made ratably among the Banks based upon such Bank's
                  Ratable Portion of such converted or continued Advance
                  comprising a Revolving Credit Borrowing or Term Borrowing;

                           (ii)     if less than all the outstanding principal
                  amount of a Borrowing is converted or continued, the aggregate
                  principal amount of such Borrowing converted or continued
                  shall be: (A) in the case of a LIBOR Borrowing, not less than
                  One Million Dollars ($1,000,000), or an integral multiple of
                  One Hundred Thousand Dollars ($100,000) in excess thereof and
                  (B) in the case of an Alternate Base Rate Borrowing, One
                  Hundred Thousand Dollars ($100,000);

                           (iii)    each Rate Conversion or Rate Continuation
                  shall be effected as if each Bank were applying the proceeds
                  of Advances resulting from such Rate Conversion or Rate
                  Continuation to Advances being converted or continued, as the
                  case may be, and the accrued interest on any such Advances (or
                  portion thereof) being converted or continued shall be paid to
                  the Administrative Agent on behalf of each Bank by the
                  Borrower at the time of such Rate Conversion or Rate
                  Continuation;

                           (iv)     a LIBOR Borrowing shall not be converted or
                  continued at a time other than the end of an Interest Period
                  applicable thereto unless the Borrower shall pay, upon demand,
                  any amounts due to any of the Banks pursuant to Section 12.4
                  of this Agreement;

                           (v)      Revolving Credit Advances may not be
                  converted into or continued as a LIBOR Borrowing if the
                  Interest Period applicable thereto will expire less than one
                  month prior to the Revolving Credit Termination Date;

                           (vi)     Advances may not be converted into or
                  continued as LIBOR Advances comprising a Term Borrowing unless
                  the Interest Period applicable thereto expires on or prior to
                  the maturity of the Loans comprising such Term Borrowing;

                                       14

<PAGE>

                           (vii)    after and during the continuance of a
                  Potential Default, and after the occurrence of an Event of
                  Default which has not been waived by the Required Banks,
                  Advances denominated in Dollars may not be converted or
                  continued as a LIBOR Borrowing;

                           (viii)   with respect to LIBOR Advances comprising a
                  Term Borrowing, no Interest Period can be selected which ends
                  after any Term Advance Repayment Date, unless, after giving
                  effect to such selection, the aggregate unpaid principal
                  amount of Alternate Base Rate Loans, together with the
                  aggregate unpaid principal amount of all Term Borrowings which
                  are comprised of LIBOR Advances with Interest Periods ending
                  on or prior to such Term Advance Repayment Date shall be at
                  least equal to that portion of the aggregate principal amount
                  of the Term Advance due and payable on and prior to such Term
                  Advance Repayment Date; and

                           (ix)     Advances that cannot be converted into or
                  continued as LIBOR Advances by reason of clause (v) or (vi) of
                  this definition shall be automatically converted at the end of
                  the Interest Period in effect for such LIBOR Advances into
                  Alternate Base Rate Advances, except that LIBOR Advances
                  denominated in an Alternate Currency that cannot be converted
                  or continued by reason of clause (v) of this definition shall
                  become due and payable upon the last day of the applicable
                  Interest Period with respect thereto.

Each such request for a conversion or continuation (a "Rate
Conversion/Continuation Request") in respect of a Revolving Credit Borrowing or
a Term Borrowing shall be a written or telephonic notice (in the case of a
telephonic notice, promptly confirmed in writing if so requested by the
Administrative Agent). Each written Rate Conversion/Continuation Request or
written confirmation thereof shall be substantially in the form of Exhibit C
attached hereto, signed by the Borrower Representative and transmitted by the
Borrower Representative and transmitted by the Borrower Representative to the
Administrative Agent by telecopier. Each written and telephonic Rate
Conversion/Continuation Request and each confirmation thereof shall specify: (A)
the identity and amount of the Advances comprising a Revolving Credit Borrowing
or Term Borrowing that the Borrower Representative requests be converted or
continued, (B) the Type of Borrowing into which such Advances are to be
converted or continued, (C) if such notice requests a Rate Conversion, the date
of the Rate Conversion (which shall be a Business Day), (D) in the case of a
Revolving Credit Borrowing or Term Borrowing being converted into or continued
as a LIBOR Borrowing, the currency in which such LIBOR Borrowing is denominated
and (E) in the case of a Revolving Credit Borrowing being converted into or
continued as LIBOR Borrowing, the Interest Period for such LIBOR Borrowing. The
Administrative Agent may rely on such telephonic Rate Conversion/Continuation
Request to the same extent that the Administrative Agent may rely on a written
Rate Conversion/Continuation Request. Each Rate Conversion/Continuation Request,
whether telephonic or written, shall be irrevocable and binding on the Borrowers
and subject the Borrowers to the indemnification provisions of Section 12 of
this Agreement. The Borrower for which a Rate Conversion/Continuation Request
was made shall bear all risks related to giving such Rate
Conversion/Continuation Request by the Borrower Representative on behalf of such
Borrower whether given telephonically or by such other method of transmission as
the Borrower Representative shall elect.

         2.11     LETTERS OF CREDIT.

                  Subject to the terms and conditions set forth in this
Agreement, each of the Fronting Bank and the Affiliate Fronting Bank, as the
case may be, agrees, at any time and from time to time from and including the
Restatement Date (but in no event after the sixtieth (60th) day immediately
preceding the Revolving Credit Termination Date and in no event having a

                                       15

<PAGE>

maturity date after the fifteenth (15th) day immediately preceding the Revolving
Credit Termination Date), to issue and deliver, or to extend the expiration of,
Fronting Bank LCs and Affiliate Fronting Bank LCs for the account of any
Borrower; provided, however, that, (x) the aggregate amount of all Trade Letters
of Credit issued hereunder shall not exceed Five Million Dollars ($5,000,000) at
any time outstanding, (y) the aggregate LC Exposure shall not exceed Twenty-Five
Million Dollars ($25,000,000) and (z) the aggregate LC Exposure plus the sum of
the aggregate outstanding Revolving Credit Advances of the Banks to all
Borrowers shall not at any time exceed the aggregate Revolving Credit
Commitment.

                  (a)      MASTER LETTER OF CREDIT AGREEMENT.

                           Each Borrower shall have executed and delivered such
         application agreement and/or such other instruments and agreements,
         including, but not limited to, the Master Letter of Credit Agreement
         relating to this Letter of Credit facility as the Issuing Bank shall
         have reasonably requested (each, a "Letter of Credit Facility
         Application") with any conflict between the terms of this Agreement and
         the terms of any Letter of Credit Facility Application being controlled
         by the terms of this Agreement.

                  (b)      EXISTING LETTERS OF CREDIT.

                           Annex VII contains a list of certain Existing Letters
         of Credit issued by National City Bank. Each such Existing Letter of
         Credit shall constitute a Fronting Bank LC for all purposes hereof.

                  (c)      TERM; FORM AND CONDITIONS OF LETTERS OF CREDIT.

                           Each Letter of Credit shall be issued in such form as
         the applicable Issuing Bank may reasonably require subject (i) in the
         case of Trade Letters of Credit, to the Uniform Customs and Practices
         for Documentary Credits (1993 Revision), International Chamber of
         Commerce Publication No. 500, and any subsequent revisions thereof and
         (ii) in the case of Standby Letters of Credit, to the International
         Standby Practices (1998), International Chamber of Commerce Publication
         No. 590, and any subsequent revisions thereof. Each Letter of Credit
         shall: (A) permit drawings upon presentation of one or more sight
         drafts and such other documents as specified by the Borrower
         Representative in the Credit Request delivered pursuant to Section
         2.2(a) of this Agreement and agreed to by the appropriate Issuing Bank,
         which drawings shall occur on or prior to the applicable expiration
         date, (B) by its terms expire not later than the earlier of one (1)
         year after the date of the Letter of Credit or the fifteenth (15th) day
         prior to the Revolving Credit Termination Date and (C) shall be subject
         to the following additional terms and conditions:

                           (i)      FRONTING BANK LCS. Each Fronting Bank LC
                  shall be (A) either a Standby Letter of Credit or a Trade
                  Letter of Credit, (B) issued for the account of any of the
                  Borrowers and (C) denominated in Dollars or an Alternate
                  Currency.

                           (ii)     AFFILIATE FRONTING BANK LCS. Each Affiliate
                  Fronting Bank LC shall be (A) a Standby Letter of Credit, (B)
                  issued for the account of any of the Borrowers, (C) issued for
                  the benefit of an Affiliate of the Administrative Agent which
                  has extended or will extend credit to a Non-US Subsidiary and
                  (D) denominated in an Alternate Currency or in Dollars.

                                       16

<PAGE>

                  (d)      REQUESTS FOR LETTERS OF CREDIT.

                           Letters of Credit shall be issued upon request given
         by the Borrower Representative to the Administrative Agent not later
         than 11:00 a.m. (central time) three (3) Business Days prior to the
         specified date of issuance for Fronting Bank LCs and ten (10) Business
         Days prior to the specified date of issuance for Affiliate Fronting
         Bank LCs. Each such request (a "Letter of Credit Request") for a Letter
         of Credit shall be a written or telephonic notice (in the case of a
         telephonic notice, promptly confirmed in writing if so requested by the
         Administrative Agent). Each written Letter of Credit Request or written
         confirmation thereof shall be substantially in the form of Exhibit B-2
         attached hereto, signed by the Borrower Representative and transmitted
         to the Administrative Agent by telecopier. Each written and telephonic
         Letter of Credit Request and each confirmation thereof shall specify
         with respect to each Letter of Credit requested: (i) the Borrower which
         is to be the account party for whose benefit the Letter of Credit is
         being requested, (ii) the face amount thereof, (iii) the beneficiary,
         (iv) the intended date of issuance, (v) the currency of such Letter of
         Credit, (vi) whether such Letter of Credit is a Fronting Bank LC or an
         Affiliate Fronting Bank LC and (vii) the terms (including the
         anticipated expiry date) of the Letter of Credit, which Letter of
         Credit Request shall be promptly forwarded by the Administrative Agent
         to the appropriate Issuing Bank. The Administrative Agent may rely on a
         telephonic Letter of Credit Request to the same extent that the
         Administrative Agent may rely on a written Letter of Credit Request.
         The Borrower for which a Letter of Credit Request was made shall bear
         all risks related to the giving of such Letter of Credit Request by the
         Borrower Representative on behalf of such Borrower whether given
         telephonically or by such other method of transmission as International
         shall elect.

                  (e)      PARTICIPATION BY BANKS.

                           By the issuance of a Letter of Credit by an Issuing
         Bank and without further action on the part of such Issuing Bank or any
         Bank, such Issuing Bank hereby grants to each Bank, and each Bank
         hereby acquires from such Issuing Bank, a participation in such Letter
         of Credit equal to such Bank's Ratable Portion, effective on the date
         of the issuance of such Letter of Credit. In consideration, each Bank
         hereby absolutely and unconditionally agrees to pay to the
         Administrative Agent for the account of the Issuing Bank such Bank's
         Ratable Portion of each disbursement made by the Issuing Bank in
         respect of such Letter of Credit and not reimbursed by the applicable
         Borrower for any reason or as to which any reimbursement payment made
         by such Borrower is required to be refunded to such Borrower for any
         reason. In consideration, each Bank hereby absolutely and
         unconditionally agrees to pay to the Administrative Agent for the
         account of the applicable Issuing Bank such Bank's Ratable Portion of
         each disbursement made by such Issuing Bank in respect of such Letter
         of Credit and not reimbursed by the applicable Borrower forthwith on
         the date due as provided in clause (d) below. Each Bank acknowledges
         and agrees that its obligation to acquire risk participations pursuant
         to this Section 2.11(e) is absolute and unconditional and shall not be
         affected by any event or circumstance whatsoever, including the
         occurrence of any Potential Default or Event of Default hereunder or
         the failure of any condition precedent set forth in Section 3 of this
         Agreement to be satisfied and each such payment shall be made without
         any offset, abatement, withholding or reduction whatsoever; provided,
         however, that the foregoing shall not be construed to excuse such
         Issuing Bank from liability to any Bank to the extent of any direct
         damages (as opposed to consequential damages, claims in respect of
         which are hereby waived by each of the Banks to the fullest extent
         permitted by applicable Law) suffered by such Bank that are caused by
         such Issuing Bank's gross negligence or willful misconduct.

                                       17

<PAGE>

                  (f)      REIMBURSEMENT; INTEREST.

                           Each Borrower agrees that whenever there is a payment
         over or other drawing ("drawdown") on a Letter of Credit issued by an
         Issuing Bank for the account of such Borrower, such Borrower shall pay
         an amount equal to such drawdown, such payment to be made in
         immediately available funds and in Dollars or the Dollar equivalent of
         the Alternate Currency, as applicable. The Administrative Agent shall
         promptly remit any such payment for the ratable benefit of the Banks.
         If there is a drawdown on a Letter of Credit, then, unless the Borrower
         shall reimburse such amount in full on such date, the unpaid amount
         thereof shall bear interest for the account of the appropriate Issuing
         Bank for each day from and including the date of such drawdown, to but
         excluding the earlier of the date of reimbursement by the applicable
         Borrower on the date on which such drawdown is reimbursed by a
         Revolving Credit Borrowing, at the rate per annum that would apply to
         such amount if such amount were an Alternate Base Rate Advance by a
         Bank.

                  (g)      FAILURE TO REIMBURSE.

                           In the event that the applicable Borrower fails to
         make a timely reimbursement, together with any interest thereon, to the
         Administrative Agent on the date of any drawdown on a Letter of Credit
         pursuant to this Section, such failure shall constitute a Deemed Credit
         Request requesting an Alternate Base Rate Loan to be made to such
         Borrower in an aggregate amount equal to the Dollar Equivalent of the
         reimbursement amount plus any interest thereon. The Administrative
         Agent shall disburse all such loan proceeds directly to the appropriate
         Issuing Bank to satisfy such Borrower's aforesaid reimbursement
         liability. The obligations of the Banks to the Administrative Agent
         under this Section are in addition to and not in limitation of the
         obligations of the Banks under Section 10 of this Agreement. In the
         event that an Advance cannot be made for any reason pursuant to this
         Section 2.11(g), each of the Banks shall reimburse the Issuing Bank in
         an amount equal to such Bank's Ratable Portion of the drawdown on the
         Letter of Credit.

                  (h)      OBLIGATIONS ABSOLUTE.

                           The obligation of the Banks to make, and of the
         applicable Borrower to pay, any Revolving Credit Advances required by
         Section 2.11(g) of this Agreement shall be absolute and unconditional
         and shall be performed under all circumstances including, without
         limitation: (i) any lack of validity or enforceability of any Letter of
         Credit, (ii) the existence of any claim, offset, defense or other right
         that any such Borrower may have against the beneficiary of any Letter
         of Credit or any successor in interest thereto, (iii) the existence of
         any claim, offset, defense or other right that any Loan Party may have
         against any such Borrower or against the beneficiary of any Letter of
         Credit or against any successor in interest thereto, (iv) the existence
         of any fraud or misrepresentation in the presentment of any draft or
         other item drawn and paid under any Letter of Credit by any person
         other than the Issuing Bank, (v) any payment of any draft or other item
         by the Issuing Bank which does not strictly comply with the terms of
         any Letter of Credit provided the payment shall not have constituted
         gross negligence or willful misconduct on the part of the Issuing Bank,
         (vi) any improper use which may be made of the Letter of Credit or any
         improper acts or omissions of any beneficiary or transferee of the
         Letter of Credit in connection therewith, (vii) any statement or any
         other documents presented under any Letter of Credit proving to be
         insufficient, forged, fraudulent or invalid in any respect or any
         statement therein being untrue or inaccurate in any respect whatsoever,
         (viii) the insolvency of any Person issuing any documents in connection
         with the Letter of Credit, (ix) any irregularity in the transaction
         with respect to which a Letter of Credit

                                       18

<PAGE>

         is issued, including any fraud by the beneficiary or any transferee of
         such Letter of Credit, (x) any errors, omissions, interruptions or
         delays in transmission or delivery of any messages, (xi) any act,
         error, neglect or default, omission, insolvency or failure of business
         of any of the correspondents of the Issuing Bank, or (xii) any other
         circumstances arising from causes beyond the control of the Issuing
         Bank.

                  (i)      LIABILITY OF ISSUING BANKS.

                           Without limiting the generality of Section 2.11(h) of
         this Agreement, it is expressly understood and agreed that the absolute
         and unconditional obligation of each Borrower to reimburse
         disbursements in respect of Letters of Credit made by an Issuing Bank
         for such Borrower's account shall not be construed to excuse any
         Issuing Bank from liability to such Borrower to the extent of any
         direct damages (as opposed to consequential damages, claims in respect
         of which are hereby waived by each of the Borrowers to the extent
         permitted by applicable Law) suffered by such Borrower that are caused
         by such Issuing Bank's gross negligence or willful misconduct in
         determining whether drafts and other documents presented under a Letter
         of Credit comply with the terms thereof. The parties agree that each
         Issuing Bank may accept documents that appear on their face to be in
         order, without responsibility for further investigation, regardless of
         any notice or information to the contrary and may make payment upon
         presentation of documents that appear on their face to be in
         substantial compliance with the terms of such Letter of Credit,
         provided, however, that each Issuing Bank shall have the right in its
         sole discretion to decline to accept such documents and to decline to
         make such payment if such documents are not in strict compliance with
         the terms of such Letter of Credit. In making any payment under any
         Letter of Credit, (i) an Issuing Bank's exclusive reliance on the
         documents, signatures and endorsements presented to it under such
         Letter of Credit as to any and all matters set forth therein, including
         reliance on the amount of any draft presented under such Letter of
         Credit, whether or not the amount due to the beneficiary thereunder
         equals the amount of such draft and whether or not any document
         presented pursuant to such Letter of Credit proves to be in order, and
         whether or not any other statement or any other document or any
         signature or endorsement with respect thereto presented pursuant to
         such Letter of Credit proves to be forged or invalid or any statement
         therein proves to be inaccurate or untrue in any respect whatsoever and
         (ii) any noncompliance in any immaterial respect of the document
         presented under such Letter of Credit with the terms thereof shall, in
         each case, be deemed not to constitute willful misconduct or gross
         negligence of an Issuing Bank. Any action, inaction or omission on the
         part of any Issuing Bank or any of its correspondents, under or in
         connection with any Letter of Credit or any renewal or extension
         thereof or the related instruments or documents, if in good faith and
         in conformity with such Laws, regulations or customs as are applicable
         and the terms of this Section 2.11(i), shall be binding upon the
         applicable Borrower and shall not place the Issuing Bank or any of its
         correspondents under any liability to such Borrower. The Issuing Banks'
         rights, powers, privileges and immunities specified in or arising under
         this Agreement are in addition to any heretofore or at any time
         hereafter otherwise created or arising, whether by statute or rule of
         Law or contract.

                  (j)      BANK INDEMNITY.

                           Each Borrower for whose account a Letter of Credit is
         issued shall indemnify the Issuing Bank issuing such Letter of Credit
         from and against: (i) any loss or liability (other than any caused by
         such Issuing Bank's gross negligence or willful misconduct as
         determined by the final judgment of a court of competent jurisdiction)
         incurred by an Issuing Bank or any other Bank, as the case may be, in
         respect of this Agreement and the Letters of Credit and (ii) any
         out-of-pocket expenses incurred in

                                       19

<PAGE>

         defending itself or otherwise related to this Agreement or any Letter
         of Credit (other than any caused by the Issuing Bank's gross negligence
         or willful misconduct as determined by the final judgment of a court of
         competent jurisdiction) including, without limitation, reasonable fees
         and expenses of legal counsel incurred by it (including, without
         limitation, the reasonable interdepartmental charges of its salaried
         attorneys) in the defense of any claim against it or in the prosecution
         of its rights and remedies.

                  (k)      EFFECT OF APPLICABLE LAW OR CUSTOM.

                           All Letters of Credit issued hereunder, all
         reimbursement obligations hereunder and all reimbursement obligations
         under any Letter of Credit Facility Application will, except to the
         extent otherwise expressly provided in this Agreement, the Letter of
         Credit Facility Application or such Letters of Credit, be governed: (i)
         in the case of Trade Letters of Credit, by the Uniform Customs and
         Practice for Documentary Credits (1993 Revision), International Chamber
         of Commerce Publication No. 500, and any subsequent revisions thereof,
         and (ii) in the case of Standby Letters of Credit, by the International
         Standby Practices (1998), International Chamber of Commerce Publication
         No. 590, and any subsequent revisions thereof. To the extent not
         inconsistent with the UCP, Article 5 of the Uniform Commercial Code as
         adopted in Illinois ("IL Article 5") shall govern Letters of Credit
         issued hereunder.

                  (l)      TERMINATION OF LETTER OF CREDIT COMMITMENT.

                           In the event that: (i) any restriction is imposed on
         the Issuing Bank (including, without limitation, any legal lending or
         acceptance limits imposed by the United States of America or any
         political subdivision thereof or of any foreign government or central
         bank) which in the judgment of the Issuing Bank would prevent the
         Issuing Bank from issuing Letters of Credit or maintaining its
         commitment to issue Letters of Credit or (ii) there shall have
         occurred, at any time during the term of this Agreement: (A) any
         outbreak of hostilities or other national or international crisis or
         change in economic conditions if the effect of such outbreak, crisis or
         change would make the creation of Letters of Credit impracticable, (B)
         the enactment, publication, decree or other promulgation of any
         statute, regulation, rule or order of any court or other governmental
         authority which would materially and adversely affect the ability of
         International to perform its obligations under this Agreement, or (C)
         the taking of any action by any government or agency in respect of its
         monetary or fiscal affairs which would have a material adverse effect
         on the issuance of Letters of Credit, then the Issuing Bank, in the
         case of the occurrence of any event described above, shall give written
         notice of the occurrence of such event to the Borrowers and the
         Administrative Agent whereupon the commitment of the Issuing Bank to
         issue Letters of Credit shall be suspended on the effective date of
         such notice and shall continue suspended until such effect of the event
         shall cease to exist.

         2.12     FEES.

                  (a)      STRUCTURING FEE.

                           The Borrowers agree to pay to the Administrative
         Agent in Dollars for the pro rata benefit of the Banks, a structuring
         fee in the amount of One Million Five Hundred Thousand Dollars
         ($1,500,000).

                                       20

<PAGE>

                  (b)      LATE CHARGES.

                           If a Borrower fails to pay any amount due under this
         Agreement, or any fee in connection herewith, in full within ten (10)
         days after its due date, the Administrative Agent shall be entitled to
         collect, in addition to its remedies under Section 8 hereof, and such
         Borrower will incur and shall pay in Dollars to the Administrative
         Agent for the benefit of the Banks, in each such case, a late charge
         equal to one percent (1%) of the amount not paid when due. The payment
         of a late charge will not cure or constitute a waiver of any Potential
         Default or Event of Default under this Agreement. The Administrative
         Agent shall provide such Borrower with five (5) Business Days' prior
         notice of the commencement of the charging of such increased interest
         rate; provided, however, that (i) any notice given prior to imposition
         of a late payment fee hereunder shall only be a notice as to this
         Section 2.12(b) and shall not be deemed to be a notice for any other
         purpose and (ii) no failure by the Administrative Agent to provide such
         notice shall limit any of the other rights of the Banks or the
         Administrative Agent.

                  (c)      LETTER OF CREDIT FEES.

                           Each Borrower shall pay to the Administrative Agent
         fees in respect of Letters of Credit issued for its account as follows:

                           (i)      STANDBY LETTER OF CREDIT FEES. Each Borrower
                  agrees to pay to the Administrative Agent for the ratable
                  benefit of the Banks, quarterly in arrears on the last
                  Business Day of each calendar quarter after the Restatement
                  Date, an annual risk participation fee equal to: (x) the
                  Letter of Credit Fee Percentage in effect from time to time
                  during such per annum period multiplied by (y) the aggregate
                  face amount of each Standby Letter of Credit outstanding from
                  time to time during such per annum period for the account of
                  each Borrower (adjusted for Standby Letters of Credit having
                  terms less than one year).

                           (ii)     TRADE LETTERS OF CREDIT. Each Borrower
                  agrees to pay to the Administrative Agent for the benefit of
                  the Fronting Bank payable on the date of a draw a fee on each
                  Trade Letter of Credit issued for its account equal to one
                  quarter of one percent (1/4%) multiplied by the face amount of
                  the Trade Letter of Credit issued by the Fronting Bank.

                           (iii)    LETTER OF CREDIT FRONTING FEE. Each Borrower
                  agrees to pay to the Administrative Agent for the benefit of
                  the Issuing Bank on the date of issuance of each Letter of
                  Credit issued for its account an issuance fee equal to one
                  eighth of one percent (1/8%) multiplied by the face amount of
                  the Letters of Credit issued by such Issuing Bank.

                           (iv)     OTHER FEES RELATING TO LETTERS OF CREDIT.
                  Each Borrower agrees to pay to the Administrative Agent for
                  the benefit of the applicable Issuing Bank upon issuance of
                  any Letters of Credit issued for its account any standard
                  fees, amendment and modification fees and any other standard
                  fees and charges charged by the Issuing Bank in connection
                  with Standby Letters of Credit and Trade Letters of Credit.

                           (v)      CURRENCY EQUIVALENT CALCULATIONS. Solely for
                  the purposes of determining the fees, payable in Dollars or
                  such other currency as agreed to (individually with each of
                  the Banks), with respect to letters of credit under this
                  Section 2.12, the Dollar Equivalent of each Letter of Credit
                  denominated in an

                                       21

<PAGE>

                  Alternate Currency shall be determined in accordance with
                  Section 1.5 of this Agreement.

                  (d)      LETTER OF CREDIT FEE PERCENTAGES.

                  So long as no Event of Default shall have occurred which has
         not been waived in accordance with Section 13.1 hereof, each Letter of
         Credit Fee Percentage shall be as herein specified as of the
         Restatement Date and thereafter adjusted as of the first Business Day
         of June, September, December and April occurring during any Fiscal
         Year, commencing on June 1, 2003 (each such date being herein referred
         to as a "Fee Percentage Adjustment Date"), on each occasion that, so
         long as prior to each such Fee Percentage Adjustment Date the
         Administrative Agent shall have received: (A) the financial statements
         required by Section 6.1(a) for the Fiscal Quarter ending immediately
         prior to such Fee Percentage Adjustment Date or, where the Fiscal
         Quarter ending prior to such Fee Percentage Adjustment Date is a Fiscal
         Year end, the financial statements required by Section 6.1(b) for such
         Fiscal Year ending immediately prior to such Fee Percentage Adjustment
         Date (each such Fiscal Quarter end and Fiscal Year end, a "Fee
         Percentage Determination Date") and (B) a certificate complying with
         Section 6.1(c) hereof certifying International's and its Subsidiaries'
         Consolidated Funded Debt to EBITDA Ratio as of any such Fee Percentage
         Determination Date. As of any Fee Percentage Adjustment Date, each
         Letter of Credit Fee Percentage shall be adjusted to be the percentage
         indicated in the following table corresponding to International's and
         its Subsidiaries' Consolidated Funded Debt to EBITDA Ratio as measured
         for the most recent Cumulative Four Quarter Period ending as of the Fee
         Percentage Determination Date.

<TABLE>
<CAPTION>
                                           Letter of
                                           Credit Fee
Applicable Financial Standard              Percentage
-----------------------------------------------------
<S>                                        <C>
Financial Standard I                         2.000%
Financial Standard II                        2.500%
Financial Standard III                       2.750%
Financial Standard IV                        3.000%
Financial Standard V                         3.250%
Financial Standard VI                        3.500%
</TABLE>

         The Letter of Credit Fee Percentage effective as of a particular Fee
         Percentage Adjustment Date shall remain effective only until the next
         succeeding Fee Percentage Adjustment Date, at which time the Letter of
         Credit Fee Percentage shall be recalculated pursuant to this Section
         2.12(d) of this Agreement; except, however, that, if (x) an Event of
         Default shall have occurred which is continuing and has not been so
         waived in accordance with Section 13.1 hereof or (y) even if any
         resulting Event of Default has been so waived, the Borrowers shall not
         have delivered as of any Fee Percentage Adjustment Date the financial
         statements required to have been delivered previously thereto under
         Sections 6.1(a) and 6.1(b) of this Agreement, then, the Letter of
         Credit Fee Percentage shall be three and one-half percent (3.50%) per
         annum.

                                       22

<PAGE>

                  (e)      AGENT'S FEE.

                           The Borrowers agree to pay to the Administrative
         Agent for its sole account an annual fee of Fifty Thousand Dollars
         ($50,000) for any whole or partial year. The annual fee of the
         Administrative Agent shall be payable, in advance for the forthcoming
         year, upon the Restatement Date and on each Anniversary Date thereafter
         so long as any Bank shall have a Revolving Credit Commitment hereunder
         or any Note or any Loan shall be outstanding.

                  (f)      FACILITY FEE.

                           The Borrowers agree to pay in Dollars to the
         Administrative Agent for the benefit of the Banks, allocable in
         accordance with the Ratable Portion of the Banks, a facility fee (the
         "Facility Fee") on the aggregate Revolving Credit Commitment at the
         Facility Fee Percentage as defined in Section 2.12(g) from the
         Restatement Date until the Revolving Credit Termination Date at a rate
         per annum equal to the Applicable Fee Percentage then in effect,
         payable quarterly in arrears on the first day of each calendar quarter
         beginning with the quarter that commences on January 1, 2003 and on the
         Revolving Credit Termination Date (if the Revolving Credit Termination
         Date is other than at the end of a calendar quarter)

                  (g)      FACILITY FEE PERCENTAGES.

                  So long as no Event of Default shall have occurred which has
         not been waived in accordance with Section 13.1 hereof, each Facility
         Fee Percentage shall be as herein specified as of the Restatement Date
         and thereafter adjusted as of the first Business Day of June,
         September, December and April occurring during any Fiscal Year,
         commencing on June 1, 2003 (each such date being herein referred to as
         a "Fee Percentage Adjustment Date"), on each occasion that, so long as
         prior to each such Fee Percentage Adjustment Date the Administrative
         Agent shall have received: (A) the financial statements required by
         Section 6.1(a) for the Fiscal Quarter ending immediately prior to such
         Fee Percentage Adjustment Date or, where the Fiscal Quarter ending
         prior to such Fee Percentage Adjustment Date is a Fiscal Year end, the
         financial statements required by Section 6.1(b) for such Fiscal Year
         ending immediately prior to such Fee Percentage Adjustment Date (each
         such Fiscal Quarter end and Fiscal Year end, a "Fee Percentage
         Determination Date") and (B) a certificate complying with Section
         6.1(c) hereof certifying International's and its Subsidiaries'
         Consolidated Funded Debt to EBITDA Ratio as of any such Fee Percentage
         Determination Date. As of any Fee Percentage Adjustment Date, each
         Facility Fee Percentage shall be adjusted to be the percentage
         indicated in the following table corresponding to International's and
         its Subsidiaries' Consolidated Funded Debt to EBITDA Ratio as measured
         for the Cumulative Four Quarter Period ending as of the Fee Percentage
         Determination Date.

                                       23

<PAGE>

<TABLE>
<CAPTION>
                                          Facility Fee
Applicable Financial Standard              Percentage
======================================================
<S>                                       <C>
Financial Standard I                         .250%
Financial Standard II                        .375%
Financial Standard III                       .375%
Financial Standard IV                        .500%
Financial Standard V                         .500%
Financial Standard VI                        .500%
</TABLE>

         The Facility Fee Percentage effective as of a particular Fee Percentage
         Adjustment Date shall remain effective only until the next succeeding
         Fee Percentage Adjustment Date, at which time the Facility Fee
         Percentage shall be recalculated pursuant to this Section 2.12(g) of
         this Agreement; except, however, that, if (x) an Event of Default shall
         have occurred which is continuing and has not been so waived in
         accordance with Section 13.1 hereof or (y) even if any resulting Event
         of Default has been so waived, the Borrowers shall not have delivered
         as of any Fee Percentage Adjustment Date the financial statements
         required to have been delivered previously thereto under Sections
         6.1(a) and 6.1(b) of this Agreement, then, the Facility Fee Percentage
         shall be one-half percent (0.50%) per annum.

                  (h)      PAYMENT OF FEES; NONREFUNDABLE.

                           All fees set forth in this Section 2.12 shall be paid
         in Dollars on the date due, in immediately available funds, to the
         Administrative Agent for distribution, if and as appropriate, to the
         Banks. Once paid, to the extent permitted by applicable Law and absent
         error on the part of the Administrative Agent, none of such fees shall
         be refundable under any circumstances.

         2.13     INTEREST.

                  (a)      REVOLVING CREDIT BORROWING INTEREST RATE.

                           Each Borrower shall pay interest on the unpaid
         principal amount of each Revolving Credit Advance made by each Bank to
         it from the date of such Revolving Credit Advance and until such
         principal amount shall be paid in full as follows:

                           (i)      REVOLVING CREDIT ALTERNATE BASE RATE
                  ADVANCES. During such periods as any Alternate Base Rate
                  Advance comprising a Revolving Credit Borrowing is
                  outstanding, at a rate per annum equal at all times to the sum
                  of the Alternate Base Rate plus the Revolving Credit Alternate
                  Base Rate Margin, payable quarterly, in arrears, on the first
                  day of each calendar quarter and on the date such Alternate
                  Base Rate Advance comprising such a Revolving Credit Borrowing
                  shall be converted or paid in full (whether at maturity, by
                  reason of acceleration or otherwise).

                           (ii)     REVOLVING CREDIT LIBOR ADVANCES. During such
                  periods as any LIBOR Advance comprising a Revolving Credit
                  Borrowing is outstanding, at a rate per annum equal to the sum
                  of LIBOR plus the Revolving Credit LIBOR

                                       24

<PAGE>

                  Margin, payable (without duplication): (A) on the last day of
                  each Interest Period and (B) if such Interest Period has a
                  duration of more than three months, on the three month
                  anniversary of the first day of such Interest Period and (C)
                  on the date such LIBOR Advance comprising a Revolving Credit
                  Borrowing shall be converted to an Alternate Base Rate Advance
                  or paid in full (whether at maturity, by reason of
                  acceleration or otherwise).

                  (b)      REVOLVING CREDIT MARGIN ADJUSTMENT.

                           (i)      COMMENCEMENT; CONDITIONS. So long as no
                  Event of Default shall have occurred which has not been waived
                  in accordance with Section 13.1 of this Agreement, the
                  Revolving Credit Alternate Base Rate Margin and the Revolving
                  Credit LIBOR Margin, as the case may be, shall be as herein
                  specified as of the Restatement Date and thereafter adjusted
                  as of the first Business Day of April, June, September, and
                  December occurring during any Fiscal Year, commencing on June
                  1, 2003 (each such date being herein referred to as a "Margin
                  Adjustment Date"), so long as prior to each such Margin
                  Adjustment Date the Administrative Agent shall have received:
                  (A) the financial statements required by Section 6.1(a) for
                  the Fiscal Quarter ending immediately prior to such Margin
                  Adjustment Date, or where the Fiscal Quarter ending
                  immediately prior to such Margin Adjustment Date is a Fiscal
                  Year end, the financial statements required by Section 6.1(b)
                  for such Fiscal Year ending immediately prior to such Margin
                  Adjustment Date (each such Fiscal Quarter End and Fiscal Year
                  end, a "Margin Determination Date") and (B) a certificate
                  complying with Section 6.1(c) hereof certifying
                  International's and its Subsidiaries' Consolidated Funded Debt
                  to EBITDA Ratio for the Cumulative Four Quarter Period ending
                  on each such date, beginning with the receipt of the March 31,
                  2003 required financial statement and certificate.

                           (ii)     CALCULATION OF ADJUSTMENT. As of any Margin
                  Adjustment Date, the Revolving Credit Alternate Base Rate
                  Margin and the Revolving Credit LIBOR Margin shall be adjusted
                  to be the percentage indicated in the following table
                  corresponding to International's and its Subsidiaries'
                  Consolidated Funded Debt to EBITDA Ratio as measured for the
                  Cumulative Four Quarter Period ending as of the Margin
                  Determination Date applicable to such Interest Period:

<TABLE>
<CAPTION>
                                         Revolving
                                      Credit Alternate
                                         Base Rate          Revolving Credit
Applicable Financial Standard              Margin             LIBOR Margin
===========================================================================
<S>                                   <C>                   <C>
Financial Standard I                       0.000%                1.750%
Financial Standard II                      0.000%                2.125%
Financial Standard III                     1.250%                2.375%
Financial Standard IV                      1.500%                2.500%
Financial Standard V                       1.750%                2.750%
Financial Standard VI                      2.000%                3.000%
</TABLE>

                                       25

<PAGE>

                           (iii)    DURATION OF REVOLVING CREDIT MARGIN
                  ADJUSTMENT. Any such adjustment to the Revolving Credit
                  Alternate Base Rate Margin or the Revolving Credit LIBOR
                  Margin shall only remain effective until the earlier of the
                  next Margin Adjustment Date or the date on which an Event of
                  Default shall occur. The Revolving Credit Alternate Base Rate
                  Margin and the Revolving Credit LIBOR Margin, as the case may
                  be, to be effective from such earlier date and from time to
                  time thereafter shall be the Revolving Credit Alternate Base
                  Rate Margin and the Revolving Credit LIBOR Margin, as the case
                  may be, as adjusted pursuant to Section 2.13(b)(ii) of this
                  Agreement; provided, however, that: (A) if an Event of Default
                  shall occur which has not been waived in accordance with
                  Section 13.1 of this Agreement by reason of the Borrowers not
                  having delivered the financial statements in accordance with
                  Section 6.1(a) and 6.1(b)of this Agreement, the Revolving
                  Credit Alternate Base Rate Margin shall be two percent (2.00%)
                  per annum and the Revolving Credit LIBOR Margin shall be three
                  percent (3.00%) per annum and (B) if an Event of Default shall
                  occur which has not been waived in accordance with Section
                  13.1 of this Agreement, the interest rate shall be the
                  interest rate applicable pursuant to Section 2.13(e) of this
                  Agreement and subject to the notice provisions set forth
                  therein. The Administrative Agent shall provide the Borrowers
                  with five (5) Business Days' prior notice of the commencement
                  of the charging of the interest rate provided for in clause
                  (A) or (B) of the preceding sentence; provided, however, that
                  (i) any notice given prior to imposition of such interest rate
                  hereunder shall only be a notice as to this Section 2.12(b)
                  and shall not be deemed to be a notice for any other purpose
                  and (ii) no failure by the Administrative Agent to provide
                  such notice shall limit any of the other rights of the Banks
                  or the Administrative Agent hereunder at any time.

                  (c)      TERM BORROWING INTEREST RATE.

                           Each Borrower shall pay interest on the unpaid
         principal amount of each Term Advance made by each Bank to it from the
         date of such Term Advance and until such principal amount shall be paid
         in full as follows:

                           (i)      TERM ALTERNATE BASE RATE ADVANCES. During
                  such periods as any Alternate Base Rate Advance comprising a
                  Term Borrowing is outstanding, at a rate per annum equal at
                  all times to the sum of the Alternate Base Rate plus the Term
                  Alternate Base Rate Margin, payable quarterly, in arrears, on
                  the first day of each calendar quarter and on the date such
                  Alternate Base Rate Advance comprising such a Term Borrowing
                  shall be converted or paid in full (whether at maturity, by
                  reason of acceleration or otherwise).

                           (ii)     TERM LIBOR ADVANCES. During such periods as
                  any LIBOR Advance comprising a Term Borrowing is outstanding,
                  at a rate per annum equal to the sum of LIBOR plus the Term
                  LIBOR Margin, payable (without duplication): (A) on the last
                  day of each Interest Period and (B) if such Interest Period
                  has a duration of more than three months, on the three month
                  anniversary of the first day of such Interest Period and (C)
                  on the date such LIBOR Advance comprising a Term Borrowing
                  shall be converted to an Alternate Base Rate Advance or paid
                  in full (whether at maturity, by reason of acceleration or
                  otherwise).

                                       26

<PAGE>

                  (d)      TERM MARGIN ADJUSTMENT.

                           (i)      COMMENCEMENT; CONDITIONS. So long as no
                  Event of Default shall have occurred which has not been waived
                  in accordance with Section 13.1 of this Agreement, the Term
                  Alternate Base Rate Margin and the Term LIBOR Margin, as the
                  case may be, shall be as herein specified as of the
                  Restatement Date and thereafter adjusted as of the first
                  Business Day of April, June, September, and December occurring
                  during any Fiscal Year, commencing on June 1, 2003 (each such
                  date being herein referred to as a "Margin Adjustment Date"),
                  so long as prior to each such Margin Adjustment Date the
                  Administrative Agent shall have received: (A) the financial
                  statements required by Section 6.1(a) for the Fiscal Quarter
                  ending immediately prior to such Margin Adjustment Date, or
                  where the Fiscal Quarter ending immediately prior to such
                  Margin Adjustment Date is a Fiscal Year end, the financial
                  statements required by Section 6.1(b) for such Fiscal Year
                  ending immediately prior to such Margin Adjustment Date (each
                  such Fiscal Quarter End and Fiscal Year end, a "Margin
                  Determination Date") and (B) a certificate complying with
                  Section 6.1(c) hereof certifying International's and its
                  Subsidiaries' Consolidated Funded Debt to EBITDA Ratio for the
                  Cumulative Four Quarter Period ending on each such date,
                  beginning with the receipt of the March 31, 2003 required
                  financial statement and certificate.

                           (ii)     CALCULATION OF ADJUSTMENT. As of any Margin
                  Adjustment Date, the Term Alternate Base Rate Margin and the
                  Term LIBOR Margin shall be adjusted to be the percentage
                  indicated in the following table corresponding to
                  International's and its Subsidiaries' Consolidated Funded Debt
                  to EBITDA Ratio as measured for the Cumulative Four Quarter
                  Period ending as of the Margin Determination Date applicable
                  to such Interest Period:

<TABLE>
<CAPTION>
                                     Term Alternate Base
Applicable Financial Standard            Rate Margin        Term LIBOR Margin
===============================================================================
<S>                                  <C>                    <C>
Financial Standard I                       0.000%                2.250%
Financial Standard II                      0.000%                2.750%
Financial Standard III                     1.500%                3.000%
Financial Standard IV                      1.750%                3.250%
Financial Standard V                       2.000%                3.500%
Financial Standard VI                      2.250%                3.750%
</TABLE>

                           (iii)    DURATION OF TERM MARGIN ADJUSTMENT. Any such
                  adjustment to the Term Alternate Base Rate Margin or the Term
                  LIBOR Margin shall only remain effective until the earlier of
                  the next Margin Adjustment Date or the date on which an Event
                  of Default shall occur. The Term Alternate Base Rate Margin
                  and the Term LIBOR Margin, as the case may be, to be effective
                  from such earlier date and from time to time thereafter shall
                  be the Term Alternate Base Rate Margin and the Term LIBOR
                  Margin, as the case may be, as adjusted pursuant to Section
                  2.13(d)(ii) of this Agreement; provided, however, that: (A) if
                  an Event of Default shall occur which has not been waived in
                  accordance with Section 13.1 of this Agreement by reason of
                  the Borrowers not having delivered the financial

                                       27

<PAGE>

                  statements in accordance with Section 6.1(a) and 6.1(b)of this
                  Agreement, the Term Alternate Base Rate Margin shall be two
                  and one quarter percent (2.250%) per annum and the Term LIBOR
                  Margin shall be three and three quarters percent (3.750%) per
                  annum and (B) if an Event of Default shall occur which has not
                  been waived in accordance with Section 13.1 of this Agreement,
                  the interest rate shall be the interest rate applicable
                  pursuant to Section 2.13(e) of this Agreement and subject to
                  the notice provisions set forth therein. The Administrative
                  Agent shall provide the Borrowers with five (5) Business Days'
                  prior notice of the commencement of the charging of the
                  interest rate provided for in clause (A) or (B) of the
                  preceding sentence; provided, however, that (i) any notice
                  given prior to imposition of such interest rate hereunder
                  shall only be a notice as to this Section 2.12(b) and shall
                  not be deemed to be a notice for any other purpose and (ii) no
                  failure by the Administrative Agent to provide such notice
                  shall limit any of the other rights of the Banks or the
                  Administrative Agent hereunder at any time.

                  (e)      DEFAULT INTEREST.

                           Following the occurrence of an Event of Default which
         has not been waived in writing by the Banks (unanimity being required
         for such waiver in order to make this Section 2.13(e) inapplicable
         after the occurrence of an Event of Default), the principal outstanding
         hereunder and the unpaid interest and fees thereon shall bear interest,
         payable on demand, for Alternate Base Rate Advances and LIBOR Advances,
         at a rate per annum which shall be equal at all times to two percent
         (2.0%) in excess of the applicable interest rate then in effect (the
         "Default Rate"). Each of the Borrowers acknowledges that this
         calculation will result in the accrual of interest on interest and each
         of the Borrowers expressly consents and agrees to this provision. The
         Administrative Agent shall provide the Borrowers with five (5) Business
         Days' prior notice of the commencement of the charging of the default
         interest rate provided for in this Section 2.13(e); provided, however,
         that (i) any notice given prior to imposition of such interest rate
         hereunder shall only be a notice as to this Section 2.12(b) and shall
         not be deemed to be a notice for any other purpose and (ii) no failure
         by the Administrative Agent to provide such notice shall limit any of
         the other rights of the Banks or the Administrative Agent hereunder at
         any time.

                  (f)      INTEREST RATE DETERMINATION.

                           (i)      ADMINISTRATIVE AGENT DETERMINATION; NOTICE.
                  The Administrative Agent shall determine LIBOR in accordance
                  with the definition of LIBOR set forth in Annex II to this
                  Agreement. The Administrative Agent shall give prompt notice
                  to each of the Banks and the Borrower of the applicable
                  interest rate determined by the Administrative Agent for
                  purposes of Sections 2.10 and 2.13 of this Agreement.

                           (ii)     FAILURE OF BORROWER TO ELECT. If no Interest
                  Period is specified in any Credit Request or any Rate
                  Conversion/Continuation Request for any LIBOR Advances, the
                  Borrower shall be deemed to have selected an Interest Period
                  with a duration of one month. If the Borrower shall not have
                  given a Rate Conversion/Continuation Request to continue or
                  convert any LIBOR Advance into the same or a different
                  Interest Period in accordance with Section 2.10 of this
                  Agreement (whether by reason of failing to give such request
                  or, upon giving a Rate Conversion/Continuation Request to
                  continue or convert any LIBOR Advances into the same or a
                  different Interest Period, which request is of no force and
                  effect and is denied by the Administrative Agent pursuant to
                  Section 2.10 of

                                       28

<PAGE>

                  this Agreement and shall not have otherwise delivered a Rate
                  Conversion/Continuation Request in accordance with Section
                  2.10 of this Agreement to convert such Advances), such LIBOR
                  Advances shall, at the end of the Interest Period applicable
                  thereto (unless repaid pursuant to the terms hereof),
                  automatically convert into Alternate Base Rate Advances,
                  except that LIBOR Advances denominated in an Alternate
                  Currency shall, at the end of the Interest Period applicable
                  thereto, become due and payable.

         2.14     EXTENSION OF REVOLVING CREDIT TERMINATION DATE.

                  On and after the Anniversary Date in 2003, and at any time
thereafter, so long as the Borrowers shall have furnished to the Administrative
Agent and each of the Loan Parties its most recent audited financial statements
required to be delivered to the Banks pursuant to Section 6.1(b), the Borrowers
may request that the Revolving Credit Termination Date be extended one year to
the Anniversary Date next following the Revolving Credit Termination Date then
in effect. Each such request for consent to extension shall be executed and
delivered to the Administrative Agent and each Loan Party no later than ninety
(90) days prior to the applicable Revolving Credit Termination Date then in
effect. The Administrative Agent and the Loan Parties agree to consider each
such request; provided, however, that (i) such consideration shall be in each
Loan Party's sole and absolute discretion and (ii) in no event shall any Loan
Party be committed to extend its Revolving Credit Commitment, nor shall any
Issuing Bank be committed to issue Letters of Credit, nor shall any Bank's
Revolving Credit Commitment be extended, unless and until every Loan Party shall
have executed and delivered to the Administrative Agent its consent and the
Administrative Agent shall have confirmed to such Loan Party the consent of the
other Loan Parties. The Loan Parties shall respond to a request hereunder within
a reasonable time period except that any failure of the Loan Parties or any one
of them to respond shall not be deemed to be a consent to such request for
extension.

         2.15     PAYMENTS AND COMPUTATIONS.

                  (a)      PAYMENTS.

                           The Borrowers shall make each payment to be made by
         them under this Agreement and under the Revolving Credit Notes with
         respect to principal of, interest on, and other amounts relating to
         Advances, not later than 12:00 noon (central time) on the day when due
         by deposit or payment of immediately available funds to the
         Administrative Agent's account maintained at the location for notices
         set forth in Section 13.13 of this Agreement for application to such
         Borrower's Loan Account. Payments received after 12:00 noon (central
         time) shall be deemed to have been received on the next succeeding
         Business Day. After receipt of any such payment, the Administrative
         Agent will cause to be distributed on the day of such receipt like
         funds relating to the payment of principal or interest or commitment
         fees or other fees (other than amounts payable pursuant to Section
         2.12(d) of this Agreement solely to the Administrative Agent) or
         amounts which may be received in respect of the Obligations of the
         Borrowers under this Agreement ratably to each of the Banks for the
         account of its respective Lending Office, and like funds relating to
         the payment of any other amount payable to any Bank to such Bank for
         the account of its Lending Office.

                  (b)      APPLICATION OF PAYMENTS.

                           The funds so distributed to each Bank shall in each
         case be applied by such Bank in accordance with the terms of this
         Agreement. Prior to the occurrence and continuation of an Event of
         Default, all funds received hereunder shall be applied: (i) first, to
         the payment of any accrued and unpaid interest and fees, in that order
         on an

                                       29

<PAGE>

         invoice by invoice basis in the order of their respective original due
         dates, until paid in full, (ii) second, to late charges until paid in
         full, (iii) third, to Related Expenses until paid in full, (iv) fourth,
         to the outstanding principal amount of any Revolving Credit Advances in
         such order as the Administrative Agent may choose in its sole
         discretion; provided, however, the Administrative Agent will use
         reasonable efforts to avoid applications that would cause early
         prepayment of a LIBOR Borrowing prior to expiration of its applicable
         Interest Period and (v) finally, to any other Obligations of the
         Borrowers hereunder. Notwithstanding the foregoing, any funds received
         by an Issuing Bank in respect of a drawdown on a Letter of Credit
         issued by such Issuing Bank shall be immediately applied to
         International's reimbursement obligation to such Issuing Bank.

                  (c)      COMPUTATIONS OF INTEREST AND FEES.

                           All computations of interest, fees and other
         compensation shall be made by the Administrative Agent on the basis of
         a year of 360 days in each case for the actual number of days
         (including the first day but excluding the last day) occurring in the
         period for which such interest or fees are payable, provided that in
         the case of Advances denominated in any Alternate Currency in respect
         of which the Administrative Agent has certified in writing that a 365
         day or 366 day basis, as the case may be, is standard market practice
         in the London interbank market, interest shall be calculated on the
         basis of a year of 365 days 366 days, as the case may be, or in each
         case for the actual number of days (including the first day but
         excluding the last day) occurring in the period for which such interest
         is payable. Each determination by the Administrative Agent of interest,
         fees or other amounts of compensation due hereunder shall be, absent
         manifest error, prima facie evidence thereof.

                  (d)      PAYMENT NOT ON BUSINESS DAY.

                           Whenever any payment hereunder or under the Revolving
         Credit Notes shall be stated to be due on a day other than a Business
         Day, such payment shall be made on the next succeeding Business Day
         subject to the definition of "Interest Period". Any such extension of
         time shall in such case be included in the computation of payment of
         interest, fees or other compensation, as the case may be.

                  (e)      PRESUMPTION OF PAYMENT IN FULL BY BORROWER.

                           Unless the Administrative Agent shall have received
         notice from any Borrower prior to the date on which any payment is due
         to the Banks hereunder that such Borrower will not make such payment in
         full, the Administrative Agent may assume that such Borrower has made
         such payment in full to the Administrative Agent on such date. In
         reliance upon such assumption, the Administrative Agent may, but shall
         not be obligated to, distribute to each Bank on such due date the
         amount then due such Bank. If and to the extent any Borrower shall not
         have made such payment in full to the Administrative Agent, each Bank
         shall repay to the Administrative Agent promptly upon demand the amount
         distributed to such Bank together with interest thereon, for each day
         from the date such amount is distributed to such Bank until the date
         such Bank repays such amount to the Administrative Agent, at Federal
         Funds Rate.

         2.16              LIBOR ADVANCES: UNASCERTAINABLE RATE; ILLEGALITY;
                           INCREASED COSTS.

                  (a)      UNASCERTAINABLE RATE; ILLEGALITY; INCREASED COSTS.

                           In the event that (x) in the case of clause (i)
         below, the Administrative Agent or (y) in the case of clauses (ii) and
         (iii) below, any Bank, shall have determined

                                       30

<PAGE>

         on a reasonable basis (which determination shall, absent manifest
         error, be final and conclusive and binding upon all parties hereto):

                           (i)      on any date for determining LIBOR for LIBOR
                  Advances for any Interest Period that, by reason of any
                  changes arising after the Restatement Date affecting the
                  London interbank eurocurrency market, adequate and fair means
                  do not exist for ascertaining the applicable interest rate on
                  the basis provided for in the definition of the "London
                  Interbank Offered Rate"; or

                           (ii)     at any time, that such Bank shall incur
                  increased costs or reductions in the amounts received or
                  receivable hereunder in an amount which such Lender deems
                  material with respect to any LIBOR Advances (other than any
                  increased cost or reduction in the amount received or
                  receivable resulting from the imposition of or a change in the
                  rate of taxes or similar charges) to the Borrowers because of
                  any change since the Restatement Date in any applicable law,
                  governmental rule, regulation, guideline, order or request
                  (whether or not having the force of law), or in the
                  interpretation or administration thereof and including the
                  introduction of any new law or governmental rule, regulation,
                  guideline, order or request (such as, for example, but not
                  limited to, a change in official reserve requirements, but, in
                  all events, excluding reserves includable in the "London
                  Interbank Offered Rate" pursuant to the definition thereof);
                  or

                           (iii)    at any time, that the making or continuance
                  of any Alternate Currency Advance denominated in Dollars has
                  become unlawful by compliance by such Bank in good faith with
                  any change since the Restatement Date in any law, governmental
                  rule, regulation, guideline or order, or the interpretation or
                  application thereof, or would conflict with any thereof not
                  having the force of law but with which such Lender customarily
                  complies;

         THEN, and in any such event, such Bank (or the Administrative Agent in
         the case of clause (i) above) shall: (x) on such date and (y) within 10
         Business Days of the date on which such event no longer exists give
         notice (by telephone confirmed in writing) to the Borrowers and to the
         Administrative Agent of such determination (which notice the
         Administrative Agent shall promptly transmit to each of the other
         applicable Banks). Thereafter (A) in the case of clause (i) above,
         LIBOR Advances shall no longer be available until such time as the
         Administrative Agent notifies the Borrowers and the applicable Banks
         that the circumstances giving rise to such notice by the Administrative
         Agent no longer exist, and any Credit Request or Rate
         Conversion/Continuation Request given by the Borrowers with respect to
         LIBOR Advances which have not yet been incurred or converted shall be
         deemed rescinded by the Borrowers or, in the case of a Credit Request,
         shall, at the option of the Borrowers, be deemed converted into a
         Credit Request for Alternate Base Rate Advance to be made on the date
         of Borrowing contained in such Credit Request, (B) in the case of
         clause (ii) above, the Borrowers shall pay to such Bank, upon written
         demand therefor, such additional amounts (in the form of an increased
         rate of, or a different method of calculating, interest or otherwise as
         such Bank shall determine) as shall be required to compensate such
         Bank, for such increased costs or reductions in amounts receivable
         hereunder (a written notice as to the additional amounts owed to such
         Lender, showing the basis for the calculation thereof, which basis must
         be reasonable, submitted to the Borrowers by such Banks shall, absent
         manifest error, be final and conclusive and binding upon all parties
         hereto) and (C) in the case of clause (iii) above, the Borrowers shall
         take one of the actions specified in Section 2.16(b) hereof as promptly
         as possible and, in any event, within the time period required by law.

                                       31

<PAGE>

                  (b)      CANCELLATION OF REQUESTS; CONVERSION OF OUTSTANDINGS.

                  At any time that any LIBOR Advance is affected by the
circumstances described in Section 2.16(a)(ii) above, the Borrowers may, and, in
the event any LIBOR Advances is affected by the circumstances described in
Section 2.16(a)(iii) above, the Borrowers shall, either (i) if the affected
LIBOR Advances is then being made pursuant to a Credit Request for a Borrowing,
by causing the Borrowers to give the Administrative Agent telephonic (confirmed
promptly in writing if requested) notice thereof on the same date that the
Borrowers were notified by a Bank pursuant to Section 2.16(a)(ii) or (iii)
above, cancel said Borrowing, convert the related Credit Request into one
requesting a Borrowing of Alternate Base Rate Advances or require the affected
Lender to make its requested Loan as an Alternate Base Rate Advance or (ii), if
the affected LIBOR Advance is then outstanding, upon at least one Business Day's
notice from the Borrowers to the Administrative Agent, require the affected Bank
to convert each such LIBOR Advance into an Alternate Base Rate Advance with such
conversion to be effective on the next succeeding day after the last day of the
Interest Period currently applicable to such LIBOR Advance, if the affected Bank
may lawfully continue to maintain and fund such Advance until such last day, or
immediately, if the affected Bank is not legally permitted to maintain and fund
such Advance until such last day; provided, that if more than one Bank is
affected at any time, then all affected Banks must be treated the same pursuant
to this Section 2.16(b).

         2.17     PRO RATA TREATMENT.

                  Except as set forth in Sections 2.12(c)(iii)(iv) and (v),
2.12(d), and 8.6 of this Agreement, each Borrowing, each payment or prepayment
of principal of any Borrowing, each payment of interest on the Advances, each
payment of the fees provided for hereunder, each Rate Conversion or Rate
Continuation of Advances comprising a Borrowing shall be allocated among the
Banks in accordance with each Bank's Ratable Portion (or if the Revolving Credit
Commitments shall have expired or been terminated, in accordance with the
respective principal amounts of each Bank's Advances). Each Bank agrees that in
computing such Bank's Ratable Portion of any Borrowing to be made hereunder, the
Administrative Agent may, in its discretion, round each Bank's percentage of
such Borrowing to the next higher or lower whole Dollar amount.

         2.18     SHARING OF SETOFFS.

                  Each Bank agrees that if it shall, through the exercise of a
right of banker's lien, setoff or counterclaim, or pursuant to a secured claim
under Section 506 of Title 11 of the United States Code or other security or
interest arising from, or in lieu of, such secured claim, received by such Bank
under any applicable bankruptcy, insolvency or other similar law or otherwise,
or by any other means, obtain payment (voluntary or involuntary) in respect of
any Advance or Advances as a result of which the unpaid principal portion of its
Advances shall be proportionately less than the unpaid principal portion of the
Advances of any other Bank, it shall be deemed simultaneously to have purchased
from such other Bank at face value, and shall promptly pay to such other Bank
the purchase price for, a participation in the Advances of such other Bank, so
that the aggregate unpaid principal amount of the Advances and participation in
the Advances held by each Bank shall be in the same proportion to the aggregate
unpaid principal amount of all Advances prior to such exercise of banker's lien,
setoff or counterclaim or other event; provided, however, that, if any such
purchase or purchases or adjustments shall be made pursuant to this Section 2.18
and the payment giving rise thereto shall thereafter be recovered, such purchase
or purchases or adjustments shall be rescinded to the extent of such recovery
and the purchase price or prices or adjustment restored without interest. Any
Bank holding a participation in an Advance deemed to have been so purchased may
exercise any and all rights of banker's lien, setoff or counterclaim with
respect to any and all moneys owing to

                                       32

<PAGE>

such Bank by reason there of as fully as if such Bank had made an Advance in the
amount of such participation.

         2.19     FAILURE TO PAY IN AN ALTERNATE CURRENCY.

                  If it is impossible or illegal for any Borrower to effect
payment of an Alternate Currency Advance in the same Alternate Currency as such
Advance was borrowed as required by Section 2.9(a) or if any Borrower shall
default in the payment when due of any payment in an Alternate Currency, the
Required Banks may, at their option, require such payment to be made to the
Administrative Agent in Dollars in the Dollar Equivalent of such Alternate
Currency. In any case in which such Borrower shall make such payment in Dollars
in the amount of the Dollar Equivalent, such Borrower agrees to hold the Banks
harmless from any loss incurred by the Banks arising from any change in the
value of Dollars in relation to such Alternate Currency between the date such
payment became due and the date of payment thereof, including, without
limitation the costs of conversion and any other costs related thereto. The
Borrowers' obligations under this Section 2.19 shall survive termination of this
Agreement with respect to amounts requested by any Bank within thirty (30) days
after such termination.

         2.20     OPTIONAL CURRENCY AMOUNTS.

                  Notwithstanding anything contained herein to the contrary, the
Administrative Agent may with respect to Credit Requests by the Borrower
Representative for Alternate Currency Advances or notices of voluntary
prepayments of less than the full amount of a LIBOR Borrowing denominated in an
Alternate Currency, engage in reasonable rounding of the Alternate Currency
amounts requested to be advanced or repaid; and, in such event, the
Administrative Agent shall promptly notify the Borrowers and the Banks of such
rounded amounts and the Borrower Representative's Credit Request or notice shall
thereby be deemed to reflect such rounded amounts.

SECTION 3         CONDITIONS OF LENDING.

         3.1      CONDITIONS PRECEDENT TO LOANS ADVANCED ON RESTATEMENT DATE.

                  The effectiveness of this Agreement, the obligation of any
Bank to make an Advance on the occasion of each Borrowing and each Rate
Conversion or Rate Continuation, and the obligation of any Issuing Bank to issue
any Letter of Credit, are subject to the conditions precedent that: (i) the
conditions set forth in Annex III, attached hereto and incorporated herein by
reference, shall have been satisfied, on or before the Restatement Date of this
Agreement and (ii) the Administrative Agent shall have received on or before the
Restatement Date of this Agreement the documents and deliveries set forth on
said Annex III (which, in the case of exhibits to this Agreement, shall be in
the forms attached hereto, with blanks completed, and, in the case of all other
deliveries, shall be in form and substance acceptable to the Administrative
Agent).

         3.2      CONDITIONS PRECEDENT TO ALL ADVANCES.

                  The obligation of each Bank to make an Advance on the occasion
of each Borrowing, Rate Conversion and Rate Continuation hereunder and the
obligation of any Issuing Bank to issue or renew any Letter of Credit are
subject to the conditions precedent that:

                  (a)      REPRESENTATION BRINGDOWN.

                           The representations and warranties contained in
         Section 5 of this Agreement are true and correct in all material
         respects on and as of the date of such

                                       33

<PAGE>

         Credit Event with the same effect as though made on and as of such
         date, except to the extent such representations and warranties
         expressly relate to an earlier date; and

                  (b)      NO DEFAULT; COMPLIANCE WITH TERMS.

                           The Borrowers shall be in compliance with all other
         terms and provisions set forth in this Agreement and in each Loan
         Document on its part to be observed or performed, and at the time of
         and immediately after such Credit Event, no Potential Default or Event
         of Default shall have occurred and be continuing; and

                  (c)      NO MATERIAL ADVERSE CHANGE.

                           There has been no event and there exists no condition
         which could reasonably be expected to have a Material Adverse Effect.

Each Credit Event and each receipt by a Borrower of the proceeds of any Advance
shall constitute a representation and warranty by the Borrowers that on the date
of such Advance or Credit Event, as the case may be, the statements in clauses
(a) through (c) above are true and correct as of such date.

         3.3      CONDITIONS PRECEDENT TO ADVANCES TO BORROWERS EXECUTING
                  ADDITIONAL BORROWER ADDENDUM.

                  The obligation of the Banks to make an Advance to, or an
Issuing Bank to issue any Letter of Credit for the account of, a signatory
Borrower executing an Additional Borrower Addendum and thereby becoming a
Borrower subsequent to the Restatement Date is subject to the conditions
precedent that: (i) the Administrative Agent and each of the Loan Parties, each
in its sole discretion, have accepted such signatory as a Borrower and have
executed the acceptance set forth in the Additional Borrower Addendum, (ii) the
conditions set forth in Annex V attached hereto and incorporated herein by
reference shall have been satisfied with respect to such signatory Borrower,
(iii) the Administrative Agent and each of the Loan Parties shall have received
on or before the date of any Advance to such signatory Borrower the documents
and deliveries set forth on Annex V attached hereto and incorporated herein by
reference and (iv) each Borrower has acknowledged and agreed to the terms of the
Additional Borrower Addendum and any resulting amendment to this Agreement.

SECTION 4         SECURITY INTEREST IN COLLATERAL; COLLATERAL REQUIREMENTS.

         4.1      GRANT OF SECURITY INTEREST.

                  To secure the prompt payment and performance of the
Obligations, and in addition to any other collateral or Lien securing the
Obligations, each Pledging Borrower hereby grants to the Administrative Agent,
for the benefit of itself and the Loan Parties, a continuing security interest
in and to and a pledge of all of the tangible and intangible personal property
and assets of the Borrower, whether now owned or existing or hereafter acquired
or arising and wheresoever located including, without limitation: (a) all
Accounts and Chattel Paper, (b) all Inventory and Goods, (c) all Equipment and
Fixtures, (d) all General Intangibles and Intellectual Property, (e) all
Investment Property and all Letter-of-credit rights, (f) all Deposit Accounts
and any and all deposits or other sums at any time credited by or due from the
Lenders to the Borrower, whether in the Operating Account, another depository
account, or other account, (g) all Instruments, Documents, documents of title,
policies and certificates of insurance, securities, choses in action, cash or
other property, to the extent owned by the Pledging Borrowers or in which the
Pledging Borrower has an interest, (h) all Supporting Obligations, (i) all
property of

                                       34

<PAGE>

the Pledging Borrowers which now or hereafter is at any time in the possession
or control of the Administrative Agent or any of the Loan Parties or in transit
by mail or carrier to or from the Administrative Agent of any of the Loan
Parties or in the possession of any Person acting on behalf of the
Administrative Agent or a Loan Party, without regard to whether the
Administrative Agent or such Loan Party received the same in pledge, for
safekeeping, as agent for collection or transmission or otherwise or whether the
Administrative Agent or Loan Party had conditionally released the same, and any
and all balances, sums, proceeds and credits of the Pledging Borrower with the
Administrative Agent or such Loan Party, (j) all accessions to, all
substitutions and replacements for, and all Products and Proceeds of the herein
above-referenced property of the Pledging Borrowers including, but not limited
to, proceeds of any insurance, indemnity, warranty or guaranty payable to the
Pledging Borrower and (k) all books, records, and other property (including, but
not limited to, credit files, programs, printouts, computer software, and disks,
magnetic tape and other magnetic media, and other materials and records) of the
Pledging Borrowers pertaining to any such above-referenced property of the
Pledging Borrowers.

         4.2      REQUIRED GRANT OF REAL PROPERTY LIENS

                  Pursuant to Section 3.1, on the Restatement Date, ERICO
Products shall execute a mortgage or deed of trust granting a lien on its real
property and fixtures specified therein.

         4.3      PERFECTION.

                  (a)      AUTHORIZATION BY DEBTOR.

                           (i)      PERFECTION BY FILING. Each Pledging Borrower
                  (i) hereby authorizes the Administrative Agent, at any time
                  and from time to time, to file initial financing statements,
                  financing statements, continuation statements, and amendments
                  thereto that describe the Collateral as "all assets" of such
                  Borrowers, or words of similar effect, and which otherwise
                  comply with and contain any other information required by the
                  UCC for the sufficiency of filing office acceptance of any
                  such initial financing statement, financing statement,
                  continuation statement, or amendment and (ii) otherwise agrees
                  to take such other action and execute such assignments or
                  other instruments or documents, in each case as the
                  Administrative Agent may request, to evidence, perfect, or
                  record the Administrative Agent's security interest in the
                  Collateral or to enable the Administrative Agent to exercise
                  and enforce its rights and remedies under this Agreement with
                  respect to any Collateral; provided, however, that, the
                  Administrative Agent and -------- ------- the Banks shall not
                  require or take any action to evidence, perfect or record
                  security interests granted by Section 4.1 in any asset of any
                  Borrower other than at the Collateral Locations and other
                  location necessitated by reason of a change contemplated by
                  Section 4.5 of this Agreement. Each of the Pledging Borrowers
                  agrees to furnish any such information to the Administrative
                  Agent promptly upon request. Any such initial financing
                  statement, financing statement, continuation statement, or
                  amendment may be filed by the Administrative Agent on behalf
                  of such Borrowers.

                           (ii)     OTHER PERFECTION METHODS. The Pledging
                  Borrowers shall, at any time and from time to time take such
                  steps as the Administrative Agent may reasonably request for
                  the Administrative Agent (i) to obtain an acknowledgment, in
                  form and substance reasonably satisfactory to the
                  Administrative Agent, of any bailee having possession of any
                  of the Collateral, stating that the bailee holds such
                  Collateral for the Administrative Agent as secured party, (ii)
                  to obtain "control" of any Investment Property, Deposit
                  Accounts, Letter-of-credit rights, or

                                       35

<PAGE>

                  "electronic chattel paper" (as such terms are defined by the
                  UCC with corresponding provisions thereof defining what
                  constitutes "control" for such items of Collateral), with any
                  agreements establishing control to be in form and substance
                  reasonably satisfactory to the Administrative Agent, and (iii)
                  otherwise to insure the continued perfection and priority of
                  the Administrative Agent's security interest in any of the
                  Collateral and of the preservation of its rights therein. If
                  any Borrower shall at any time acquire a "commercial tort
                  claim" (as such term is defined in the UCC) in excess of
                  $500,000, such Borrower shall promptly notify the
                  Administrative Agent thereof in a writing, therein providing a
                  reasonable description and summary thereof, and upon delivery
                  thereof to the Administrative Agent, such Borrower shall be
                  deemed to thereby grant to the Administrative Agent (and such
                  Borrower hereby grants to the Administrative Agent) a security
                  interest and lien in and to such commercial tort claim and all
                  proceeds thereof, all upon the terms of and governed by this
                  Agreement.

                           (iii)    SAVINGS CLAUSE. Nothing contained in this
                  Section 4.3 shall be construed to narrow the scope of the
                  Administrative Agent's security interests or the perfection or
                  priority thereof or to impair or otherwise limit any of the
                  rights, powers, privileges, or remedies of the Administrative
                  Agent under the Loan Documents.

                  (b)      CONTROL ACCOUNTS.

                           No Pledging Borrower shall maintain any Securities
         Account or Commodity Account that is not a Control Account.

                  (c)      CONTROL OF INVESTMENT PROPERTY.

                           No Pledging Borrower shall grant Control over any
         Investment Property to any Person other than the Administrative Agent.

         4.4      GENERAL REPRESENTATIONS AS TO COLLATERAL.

                  As of the Restatement Date, the Supplemental Schedule sets
forth each location in the United States where any Borrower or US Subsidiary
maintains a manufacturing facility or a warehouse where such Borrower regularly
maintains Inventory (other than consigned Inventory or Inventory located at such
Borrower's suppliers). Each Pledging Borrower and each US Subsidiary represents
that the Supplemental Schedule sets forth in respect of each such Pledging
Borrower and such US Subsidiary: (a) the place of incorporation of such Pledging
Borrower and such US Subsidiary, the principal place of business of such
Pledging Borrower and such US Subsidiary and the office where the chief
executive offices and accounting offices of such Pledging Borrower and US
Subsidiary are located, (b) the office where each such Pledging Borrower and US
Subsidiary keeps its records concerning the Accounts and General Intangibles,
(c) the location of each such Pledging Borrower's and US Subsidiary's registered
office, (d) the accurate address with respect to each Collateral Location, (e)
the locations of each such Pledging Borrower's and US Subsidiary's registered
offices, other offices and places of business during the five (5) years prior to
the date hereof and (f) all trade names, assumed names, fictitious names and
other names used by each such Pledging Borrower and US Subsidiary during the
five (5) years prior to the date hereof (g) the locations and addresses of all
owned or leased real property of each such Pledging Borrower and US Subsidiary,
including the name of the record owner of such property and its respective legal
description, (h) all Deposit Accounts, Securities Accounts and Commodity
Accounts maintained by any such Pledging Borrower or US Subsidiary.

                                       36

<PAGE>

         4.5      CHANGES AFFECTING PERFECTION.

                  No Pledging Borrower and no US Subsidiary shall make any
change in the location of the Collateral or locate any of such Collateral at any
new locations unless such new location is (i) a warehouse, bailee or consignee
of the Pledging Borrower or a US Subsidiary, (ii) is located outside of the
United States, (iii) a location at which such Collateral will be located for
less than four (4) months or (iv) a location with respect to which the Pledging
Borrower has given the Administrative Agent notice of such new location within
thirty (30) days after such change of location. No Pledging Borrower and no US
Subsidiary shall, without giving the Administrative Agent thirty (30) days prior
notice thereof: (a) make any change in the place of incorporation, the location
of its chief executive office, principal place of business, (b) make any change
in its name or adopt any trade names, assumed names or fictitious names or
otherwise add any name under which such Pledging Borrower or US Subsidiary does
business or (c) make any other change out of the ordinary course of business
which might affect the perfection or priority of the Administrative Agent's Lien
in the Collateral located at the Collateral Locations.

         4.6      POWER OF ATTORNEY FOR INSURANCE.

                  Upon request of the Administrative Agent, each Borrower shall
promptly deliver to the Administrative Agent true copies of all reports made to
insurance companies. Each Pledging Borrower hereby irrevocably makes,
constitutes, and appoints the Administrative Agent (and all officers, employees,
or agents designated by the Administrative Agent) as its true and lawful
attorney-in-fact and agent, with full power of substitution, such that the
Administrative Agent shall have the right and authority, upon the occurrence of
an Event of Default which has not been waived in writing by the Required Banks
in accordance with Section 13.1, to make and adjust claims under such policies
of insurance, receive and endorse the name of such Borrower on, any check,
draft, instrument or other item of payment for the proceeds of such policies of
insurance and make all determinations and decisions with respect to such
policies of insurance. Each Borrower hereby ratifies all that said attorneys
shall lawfully do or cause to be done by virtue hereof. This power of attorney
is a power coupled with an interest and shall be irrevocable. Without waiving or
releasing any obligation, Potential Default or Event of Default by a Borrower
under this Agreement, the Administrative Agent may (but shall not be required
to) at any time or times thereafter maintain such action with respect thereto as
the Administrative Agent deems advisable. All reasonable sums disbursed by the
Administrative Agent in connection therewith (including, but not limited to,
reasonable attorneys' and paralegals' fees and disbursements, court costs,
expenses and other charges relating thereto) shall be payable on demand and,
until paid by such Borrower to the Administrative Agent, shall incur interest,
payable on demand, at the Alternate Base Rate plus two percent (2.0%), and shall
be additional Obligations under this Agreement secured by the Collateral.

         4.7      PROTECTION OF COLLATERAL; REIMBURSEMENT.

                  All insurance expenses and all expenses of protecting,
storing, warehousing, insuring, handling, maintaining, and shipping any
Collateral, any and all excise, property, sales, use, or other taxes imposed by
any state, Federal, or local authority on any of the Collateral, or in respect
of the sale thereof, or otherwise in respect of a Borrower's business operations
which, if unpaid, could result in the imposition of any Lien upon the
Collateral, shall be borne and paid by such Pledging Borrower. If a Pledging
Borrower fails to promptly pay any portion thereof when due, except as may
otherwise be permitted under this Agreement or under any of the other Loan
Documents, the Administrative Agent, at its option, may, but shall not be
required to, pay the same. All sums so paid or incurred by the Administrative
Agent for any of the foregoing and any and all other costs, expenses and other
sums (including reasonable attorneys' fees and paralegals' fees, legal expenses,
and court costs, expenses and other charges related thereto) which the
Administrative Agent may incur in enforcing or protecting its Liens on or rights
and

                                       37

<PAGE>

interests in the Collateral or any of its rights or remedies under this
Agreement or any other agreement between the parties to this Agreement with
respect to the Collateral and for which such Pledging Borrower may become liable
under this Agreement shall be repayable within (5) Business Days of demand and
if not paid within said five (5) Business Day period, which amount shall also
accrue interest, until paid by such Pledging Borrower to the Administrative
Agent with interest thereon at a rate per annum equal to the Alternate Base Rate
plus two percent (2.0%), shall be additional Obligations under this Agreement
secured by the Collateral. Unless otherwise required herein or provided by law,
the Administrative Agent shall not be liable or responsible in any way for the
safekeeping of any of the Collateral or for any loss or damage thereto or for
any diminution in the value thereof, or for any act or default of any
warehouseman, carrier, forwarding agency, or other Person whomsoever.

         4.8      REINSTATEMENT.

                  The provisions of this Section 4 shall remain in full force
and effect and continue to be effective should any petition be filed by or
against a Pledging Borrower for liquidation or reorganization, should such
Pledging Borrower become insolvent or make an assignment for the benefit of
creditors or should a receiver or trustee be appointed for all or any
significant part of such Pledging Borrower's assets or should any other
Financial Impairment occur, and shall continue to be effective or be reinstated,
as the case may be, if at any time payment and performance of the Obligations,
or any part thereof, is, pursuant to applicable law, rescinded or reduced in
amount, or must otherwise be restored or returned by any obligee of the
Obligations, whether as a "voidable preference", "fraudulent conveyance", or
otherwise, all as though such payment or performance had not been made. In the
event that any payment, or any part thereof, is rescinded, reduced, restored or
returned, the Obligations shall be reinstated and deemed reduced only by such
amount paid and not so rescinded, reduced, restored or returned.

         4.9      TERMINATION OF SECURITY INTEREST; RELEASE OF COLLATERAL.

                  Upon the payment in full of all Obligations and the
termination of the Revolving Credit Commitment and elimination of the LC
Exposure: (a) the security interests granted to the Administrative Agent under
this Agreement and under any other Loan Documents shall terminate, (b) all
rights to the Collateral shall revert to the Pledging Borrower having title
thereto, (c) the Administrative Agent for the benefit of the Loan Parties will
promptly, at such Pledging Borrower's expense, execute and deliver to such
Pledging Borrower such documents as such Pledging Borrower may reasonably
request to evidence the termination of such security interests and the release,
reconveyance and/or discharge of such Collateral, and (d) this Agreement and all
of the Loan Documents with such Pledging Borrower will be terminated, and such
Pledging Borrower will have no further liabilities or obligations thereunder
(except any liabilities and/or obligations which under the terms of this
Agreement or any Loan Document survive termination of such agreements).

SECTION 5         GENERAL REPRESENTATIONS AND WARRANTIES.

         So long as the Obligations or any LC Exposure shall remain outstanding
or the Banks or the Issuing Banks have any Commitment or outstanding Term
Advances hereunder, each Pledging Borrower, jointly and severally, and each
other Borrower, severally, represents and warrants to the Administrative Agent
and each of the Loan Parties as follows:

                                       38

<PAGE>

         5.1      EXISTENCE.

                  Each Borrower and each Substantial Guarantor is duly
organized, validly existing and, in the case of any Pledging Borrower, in good
standing under the laws of the state of its incorporation. Each Subsidiary of
each Borrower is duly organized, validly existing and, where applicable, in good
standing under the laws of the jurisdiction of its incorporation or formation
except where the failure to do so could not reasonably be expected to have a
Material Adverse Effect. As of the Restatement Date, the Supplemental Schedule
sets forth each of the material Subsidiaries of Holding and each Subsidiary
identified in the financial statements referred to in Section 5.12 of this
Agreement. Except as set forth in the Supplemental Schedule all of the
outstanding stock of each Borrower and each Subsidiary referred to in the
preceding sentence that is owned, directly or indirectly, by International is
fully paid and non-assessable and owned by International or its Subsidiary free
from any security interest, option, equity or other right of any kind (other
than the security interests granted hereunder or under any Loan Document). Each
Borrower and each of its Subsidiaries are duly qualified or licensed to transact
business in each jurisdiction where such qualification or licensure is
necessary, except where failure to do so could not reasonably be expected to
have a Material Adverse Effect.

         5.2      AUTHORIZATION.

                  The execution, delivery, and performance of this Agreement and
the Loan Documents to which each Borrower is a party: (a) are within such
Borrower's corporate powers, (b) have been duly authorized, and are not in
contravention of Law or the terms of such Borrower's Charter Documents or of any
indenture or other document or instrument evidencing borrowed money or any other
agreement or undertaking to which such Borrower is a party or by which it or its
property is bound.

         5.3      ENFORCEABILITY.

                  This Agreement and each Loan Document constitutes the legal,
valid and binding obligations of each Borrower and each US Subsidiary which is a
party thereto, enforceable against such Borrower or US Subsidiary in accordance
with the terms thereof, subject to any applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).

         5.4      LITIGATION; PROCEEDINGS.

                  Except as set forth in the Supplemental Schedule, there are no
actions, suits, investigations or proceedings, and no orders, writs,
injunctions, judgments or decrees, now pending, existing or, to the knowledge of
any Borrower, threatened against such Borrower or any of its Subsidiaries,
affecting any property of such Borrower or any of its Subsidiaries or with
respect to this Agreement, any Loan Document, the Acquisition Agreement or any
Acquisition Document, whether at law, in equity or otherwise, before any court,
board, commission, agency or instrumentality of any federal, state, local or
foreign government or of any agency or subdivision thereof, or before any
arbitrator or panel of arbitrators and that could reasonably be expected to have
a Material Adverse Effect.

         5.5      TAXES.

                  Each Borrower and its Subsidiaries have filed all federal,
state and local tax returns which are required to be filed by such Borrower and
such Subsidiaries and, except to the extent permitted by Section 6.2(h) of this
Agreement, the failure of which to file or pay, as the

                                       39

<PAGE>

case may be, could reasonably be expected to have a Material Adverse Effect, or
has paid all taxes and assessments due as shown on such returns, including
interest, penalties and fees.

         5.6      TITLE.

                  Except for such imperfections of title that could not
reasonably be expected to have a Material Adverse Effect, each Borrower has good
title to all owned personal property assets reflected in, and legal title to all
owned real property assets reflected in, the financial statements referred to in
Section 5.12, 13.19 of this Agreement and in the consolidated financial
statements delivered from time to time pursuant to Section 6.1 of this
Agreement. All such assets are free of all Liens other than (i) those in favor
of the Administrative Agent, (ii) those otherwise disclosed in the Supplemental
Schedule and (iii) those permitted by Section 6.3(c) of this Agreement.

         5.7      LIEN PRIORITY.

                  From and after the Restatement Date, except as provided in
Section 6.3(c) of this Agreement, by reason of the filing of financing
statements and termination statements filed in the requisite governmental
offices with respect to the Collateral Locations, this Agreement and the Loan
Documents will create and constitute a valid and perfected first priority
security interest in and Lien on such Collateral, which security interest will
be enforceable against each Pledging Borrower and all third parties as security
for payment of all Obligations.

         5.8      CONSENTS; APPROVALS.

                  Except as set forth on the Supplemental Schedule, no action,
consent or approval of, registration or filing with or any other action by any
governmental authority or other Person is or will be required in connection with
the transactions contemplated by this Agreement and the Loan Documents, except
such as have been made or obtained and are in full force and effect.

         5.9      LAWFUL OPERATIONS.

                  The operations of each Borrower and its Subsidiaries are in
full compliance with all requirements imposed by Law, including without
limitation, occupational safety and health laws and zoning ordinances the
noncompliance with which has resulted or could reasonably be expected to result
in a Material Adverse Effect.

         5.10     ENVIRONMENTAL COMPLIANCE.

                  No Borrower nor any of its Subsidiaries has (i) failed to
obtain any permits, certificates, licenses, approvals, registrations and other
authorizations which are required under any applicable Environmental Law where
failure to have any such permit, certificate, license, approval, registration or
authorization could reasonably be expected to have a Material Adverse Effect;
(ii) failed to comply with the terms and conditions of any such permits,
certificates, licenses, approvals, registrations and authorizations where
failure to comply could reasonably be expected to have a Material Adverse
Effect; or (iii) failed to conduct its business so as to comply in all respects
with applicable Environmental Laws where failure to so comply could reasonably
be expected to have a Material Adverse Effect.

         5.11     ERISA.

                  No Accumulated Funding Deficiency exists in respect of any
Employee Benefit Plan of any Borrower, its Subsidiaries or any ERISA Affiliate
thereof. No Reportable Event has occurred in respect of any Employee Benefit
Plan which are continuing and which: (i) constitutes

                                       40
<PAGE>

grounds either for termination of the plan or for court appointment of a trustee
for the administration thereof or (ii) has resulted or could reasonably be
expected to result in a Material Adverse Effect. No "prohibited transactions"
(as defined in Section 406 of ERISA or Section 4975 of the Code), have occurred
that could cause any Borrower or any of its Subsidiaries or any ERISA Affiliate
thereof to incur a material liability. No Borrower, nor its Subsidiaries nor any
ERISA Affiliate thereof, is a party to any Multiemployer Plan.

         5.12     FINANCIAL STATEMENTS.

                  As of the Restatement Date, International has furnished to the
Administrative Agent and the Banks complete and correct copies of its (i)
audited consolidated balance sheets of International and its Subsidiaries for
its Fiscal Year ending December 31, 2001, and the related consolidated
statements of income, stockholders' equity and cash flows, for such Fiscal
Years, and the notes to such consolidated financial statements, reported upon by
Ernst & Young, certified public accountants, (ii) its unaudited consolidating
balance sheets and related statements of income for International and its
Subsidiaries for its Fiscal Year ending December 31, 2001, certified by a
Responsible Officer of International and (iii) its unaudited consolidated and
consolidating balance sheets, related statements of income and cash flows of
International and its Subsidiaries for the Fiscal Quarter ending September 30,
2002, certified by a Responsible Officer of International. Each of such
financial statements: (a) has been prepared in accordance with GAAP, applied on
a consistent basis with the financial statements of International and its
Subsidiaries from the prior Fiscal Year and (b) fairly presents in all material
respects (subject to normal or routine year-end audit adjustments in the case of
the unaudited financial statements) the consolidated financial condition of
International and its Subsidiaries as of the respective dates thereof (including
a full disclosure of liabilities, contingent or otherwise, if any) and the
results of its operations for the respective fiscal periods then ending. In
addition, as of the Restatement Date, ERICO Products has furnished to the
Administrative Agent and the Banks complete and correct copies of the internally
prepared statement of income and balance sheet of ERICO Products and its
Subsidiaries for its Fiscal Year ending December 31, 2001, certified by a
Responsible Officer of ERICO Products. Such financial statements of ERICO
Products and its Subsidiaries have been prepared in accordance with GAAP and
fairly represent in all material respects the financial condition of ERICO
Products and its Subsidiaries with, as of the respective dates thereof and the
results of its operations for the respective fiscal periods then ending. As of
the Restatement Date, no event has occurred that has had or could reasonably be
expected to have Material Adverse Effect and since the most recent
above-referenced year-end financial statements there has been no change in the
accounting procedures used by the Borrowers.

         5.13     INTELLECTUAL PROPERTY.

                  Except as set forth in the Supplemental Schedule, each
Borrower and its Subsidiaries owns or has the legal and valid right to use the
Intellectual Property necessary for the operation of its business as presently
conducted, free from any Lien not permitted under Section 6.3(c) except to the
extent that the failure to have such ownership or right to use could not
reasonably be expected to have a Material Adverse Effect.

         5.14     VALUE; SOLVENCY.

                  Each Borrower and each Substantial Guarantor has received fair
consideration and reasonably equivalent value for the obligations and
liabilities incurred to the Loan Parties hereunder. Each Borrower and each
Substantial Guarantor is Solvent.

                                       41
<PAGE>

         5.15     INVESTMENT COMPANY ACT STATUS.

                  No Borrower nor any of its Subsidiaries is an "investment
company", or an "affiliated person" of, or a "promoter" or "principal
underwriter" for an "investment company" (as such terms are defined in the
Investment Company Act of 1940, as amended (15 U.S.C. Section 80(a)(1), et
seq.)).

         5.16     REGULATION U/REGULATION X COMPLIANCE.

                  The proceeds of Advances made to any Borrower pursuant to this
Agreement will be used only for the purposes contemplated by Section 6.2(g)
hereof. No part of the proceeds of Advances made to any Borrower pursuant to
this Agreement will be used, directly or indirectly, to purchase or carry any
"margin stock" or for a purpose which violates any law, rule, or regulation
including, without limitation, the provisions of Regulation T, U or X of the
Board of Governors of the Federal Reserve System, as amended. No Borrower nor
any of its Subsidiaries owns any "margin stock", as that term is defined in
Regulation U and Regulation X of the Board of Governors of the Federal Reserve
System.

         5.17     ACQUISITION AGREEMENT.

                  Each Permitted Acquisition has been or will be consummated in
accordance with the respective terms of the applicable Acquisition Agreement,
without any amendment, waiver, modification or termination of any provision
thereof except such as could not reasonably be expected to result in a Material
Adverse Effect.

         5.18     ACQUISITION DOCUMENTS.

                  The Borrowers have delivered to the Administrative Agent
unexecuted copies of each Acquisition Agreement, the Acquisition Documents and
each other instrument, agreement or document regarding the Acquisition and any
Permitted Acquisition certified by a Responsible Officer of the Borrower or
Subsidiary which is a party thereto that such documents are, in all material
respects, in the form to be executed.

         5.19     FULL DISCLOSURE.

                  None of the written information, exhibits or reports furnished
by any Borrower to the Administrative Agent or the Loan Parties when such
information, exhibits or reports are taken as a whole omit to state any fact
necessary to make the statements contained therein not misleading in light of
the circumstances and purposes for which such information was provided except
where such omission could not reasonably be expected to have a Material Adverse
Effect. Each Borrower has provided all information requested by the
Administrative Agent and the Loan Parties, and all such information is complete
and accurate in all material respects.

         5.20     RECAPITALIZATION.

                  Concurrently with the execution and delivery of this Agreement
and upon the making of the initial Advances hereunder and the filing of the
merger certificate, (a) the Recapitalization is effective and (b) the
transactions contemplated by the Merger Agreement have each been consummated
strictly (i) in accordance with the respective terms thereof, without any
amendment, waiver, modification or termination of any provision thereof except
for such amendment, waiver, modification, termination or noncompliance therewith
as to which the Administrative Agent has been notified in writing prior to such
consummation and (ii) in compliance with all applicable Law. The Merger
Agreement constitutes the legal, valid and

                                       42
<PAGE>

binding obligations of each party thereto, enforceable against such party in
accordance with the terms thereof.

         5.21     MERGER AGREEMENT AND MERGER DOCUMENTS.

                  The Borrowers shall have delivered to the Administrative Agent
true and correct copies of each of the Merger Agreement and the other Merger
Documents, and, to the extent requested by the Administrative Agent, each other
instrument, agreement or document regarding the Recapitalization. Each party to
the Merger Agreement has performed and/or satisfied all obligations and
conditions required of it prior to or as a condition to the consummation of the
transactions contemplated by and consummated under the Merger Agreement except
for such nonperformance or nonsatisfaction as to which the Administrative Agent
has been notified in writing prior to such consummation.

SECTION 6         COVENANTS OF THE BORROWERS.

         So long as the Obligations or any Letter of Credit shall remain
outstanding or the Banks shall have any Revolving Credit Commitment or
outstanding Term Advances hereunder, each Borrower will comply with the
following provisions unless the Administrative Agent and the Loan Parties agree
in writing otherwise:

         6.1      REPORTING AND NOTICE COVENANTS.

                  (a)      QUARTERLY FINANCIAL STATEMENTS.

                           The Borrowers shall furnish to the Administrative
         Agent and each Loan Party, as soon as practicable and in any event
         within forty-five (45) days after the end of each of the first three
         Fiscal Quarters of International, unaudited consolidated and
         consolidating balance sheets of International and its Subsidiaries as
         at the end of that Fiscal Quarter and the related statements of
         operations, retained earnings and cash flow for the year to the end of
         that quarterly period for such Fiscal Quarter, prepared on an unaudited
         comparative basis with the comparable period of the prior year and in
         accordance with GAAP, all in reasonable detail and certified, subject
         to normal year-end audit adjustments, by a Responsible Officer of
         International. In addition, ERICO Products shall furnish to the
         Administrative Agent and each Loan Party, as soon as practical and in
         any event within forty-five (45) days after the end of each of the
         first three Fiscal Quarters of ERICO Products, internally prepared
         statements of income and balance sheets of ERICO Products and its
         Subsidiaries as at the end of that Fiscal Quarter, prepared in
         accordance with GAAP and past practices, all in reasonable detail and
         certified by a Responsible Officer of ERICO Products. In addition,
         Holding shall furnish to the Administrative Agent and each Loan Party,
         as soon as practical and in any event within forty-five (45) days after
         the end of each Fiscal Quarter of Holding, internally prepared
         statements of income and balance sheets of Holding as at the end of
         that Fiscal Quarter, prepared in accordance with GAAP and past
         practices, all in reasonable detail and certified by a Responsible
         Officer of Holding.

                  (b)      ANNUAL FINANCIAL STATEMENTS.

                           The Borrowers shall furnish to the Administrative
         Agent and each of the Loan Parties, as soon as practicable and in any
         event within ninety (90) days after the end of each Fiscal Year of
         International, a complete copy of the (a) annual audited report of
         International (including, without limitation, all consolidated
         financial statements of International and notes thereto) for that
         Fiscal Year: (i) prepared on a comparative basis with the prior year
         and in accordance with GAAP and (ii) audited and certified (without

                                       43
<PAGE>

         qualification as to GAAP), by Ernst & Young or such other independent
         public accountants of recognized national standing selected by
         International and acceptable to the Administrative Agent and the Loan
         Parties, and (iii) promptly upon receipt, the accountants' management
         report and any management letters relating thereto, if any and (b)
         unaudited report of International including all consolidating financial
         statements of International and its Subsidiaries for that Fiscal Year:
         (i) prepared on a comparative basis with the prior year and in
         accordance with GAAP and (ii) certified by a Responsible Officer of
         International. In addition, ERICO Products shall furnish to the
         Administrative Agent and each Loan Party, as soon as practical and in
         any event within ninety (90) days after the end of each Fiscal Year of
         ERICO Products, internally prepared statements of income and balance
         sheets of ERICO Products and its Subsidiaries as at the end of that
         Fiscal Quarter, prepared in accordance with GAAP and past practices,
         all in reasonable detail and certified by a Responsible Officer of
         ERICO Products.

                  (c)      OFFICER'S CERTIFICATE.

                           The Borrowers shall furnish to the Administrative
         Agent and the Loan Parties:

                           (i)      concurrently with the financial statements
                  delivered in connection with Section 6.1(a) above , a
                  certificate of a Responsible Officer of International, in his
                  or her capacity as such, in form and substance satisfactory to
                  the Administrative Agent: (A) certifying that, to the best of
                  his or her knowledge and belief, those financial statements
                  fairly present in all material respects the financial
                  condition and results of operations of International and its
                  Subsidiaries subject (in the case of interim and other
                  unaudited financial statements) to routine year-end audit
                  adjustments, (B) setting forth the computations necessary to
                  determine (x) the LIBOR Margin under Section 2.13 of this
                  Agreement, (y) to determine the Facility Fee, and (z) whether
                  the Borrowers are in compliance with Section 6.4 of this
                  Agreement and (C) certifying that no Potential Default or
                  Event of Default then exists or, if any Potential Default or
                  Event of Default does exist, a brief description of the
                  Potential Default or Event of Default and the intentions of
                  International and the other Borrowers in respect thereof, and

                           (ii)     concurrently with the financial statements
                  delivered in connection with Section 6.1(b) above, a
                  certificate of a Responsible Officer of International, in his
                  or her capacity as such, in form and substance satisfactory to
                  the Administrative Agent: (A) certifying that, to the best of
                  his or her knowledge and belief, the financial statements
                  fairly present in all material respects the financial
                  condition and results of operations of International and its
                  Subsidiaries, (B) setting forth the computations necessary to
                  determine (x) the LIBOR Margin pursuant to Section 2.13 of
                  this Agreement, (y) to determine the Facility Fee, and
                  (z)whether the Borrowers are in compliance with Section 6.4 of
                  this Agreement and (C) certifying that no Potential Default or
                  Event of Default then exists or, if any Potential Default or
                  Event of Default does exist, a brief description of the
                  Potential Default or Event of Default and the intentions of
                  International and the other Borrowers in respect thereof.

                  (d)      ANNUAL BUDGET.

                           No later than thirty (30) days after the Fiscal Year
         of International ends, the Borrowers shall provide the Administrative
         Agent and the Loan Parties with an annual budget, including, without
         limitation, (i) a projected consolidated balance sheet of International
         and its Subsidiaries on a monthly basis, (ii) projected statements of

                                       44
<PAGE>

         stockholder's equity on a monthly basis and (iii) the projected
         statements of income on a monthly basis and setting forth the
         underlying assumptions.

                  (e)      NOTICE OF DEFAULT.

                           Within five (5) Business Days after any Borrower
         becomes aware of the occurrence of any Potential Default or Event of
         Default, such Borrower shall deliver to the Administrative Agent and to
         each Loan Party a statement of a Responsible Officer of such Borrower
         setting forth details of such Potential Default or Event of Default and
         the action which such Borrower has taken or proposes to take with
         respect thereto.

                  (f)      OTHER INFORMATION AND DELIVERIES.

                           Each of the Borrowers shall furnish to the
         Administrative Agent, promptly upon the Administrative Agent's or any
         Loan Party's written request, such other information about (i) the
         financial condition, properties and operations of: (A) such Borrower,
         (B) ERICO Products and its Subsidiaries, and (C) Holding, and (ii) any
         Employee Benefit Plans. Further, each of the Borrowers shall deliver to
         the Administrative Agent , promptly upon the Administrative Agent's or
         any Loan Party's written request, such other approvals or documents as
         the Administrative Agent or any Loan Party may reasonably request
         consistent with the terms of this Agreement.

                  (g)      NOTICES.

                           Each Borrower will cause a Responsible Officer, or in
         his or her absence another officer designated by him or her, to give
         the Administrative Agent and each Loan Party prompt written notice (and
         in any event within five (5) Business Days) whenever: (i) such Borrower
         or any of its Subsidiaries receives notice from any court, agency or
         other governmental authority of any alleged non-compliance with any Law
         or order that could reasonably be expected to have a Material Adverse
         Effect, (ii) the Internal Revenue Service or any other federal, state
         or local taxing authority shall allege any default by such Borrower or
         any of its Subsidiaries in the payment of any tax material in amount or
         shall threaten or make any assessment in respect thereof that could
         reasonably be expected to have a Material Adverse Effect, (iii) any
         litigation or proceeding shall be brought against such Borrower or any
         of its Subsidiaries before any court or administrative agency which
         could reasonably be expected to have a Material Adverse Effect, (iv)
         any change or development in connection with any such litigation
         proceeding which could reasonably be expected to have a Material
         Adverse Effect, (v) any termination of or default under any agreement
         which could reasonably be expected to have a Material Adverse Effect,
         (vi) such Responsible Officer reasonably believes (or receives notice
         from any governmental agency alleging) that any Reportable Event has
         occurred in respect of any Employee Benefit Plan that could reasonably
         be expected to have a Material Adverse Effect, (vii) such Responsible
         Officer reasonably believes, upon satisfaction of duty of due inquiry,
         that any Potential Default or Event of Default has occurred or that any
         other representation or warranty made herein shall for any reason have
         ceased to be true and complete in any material respect or (viii) such
         Responsible Officer reasonably believes, upon satisfaction of duty of
         due inquiry, that there has occurred or begun to exist any other event,
         condition, event or circumstance that could reasonably be expected to
         have a Material Adverse Effect.

                  (h)      NOTICE OF DEFAULT UNDER ERISA.

                           If any Borrower or any of its Subsidiaries shall
         receive notice from any ERISA Regulator or otherwise have actual
         knowledge that a Default under ERISA exists

                                       45
<PAGE>

         with respect to any Employee Benefit Plan that could reasonably be
         expected to have a Material Adverse Effect, such Borrower shall notify
         the Administrative Agent and each Loan Party of the occurrence of such
         Default under ERISA, within five (5) Business Days after receiving such
         notice or obtaining such knowledge and shall: (i) so long as such
         Default under ERISA has not been corrected to the satisfaction of, or
         waived in writing by, the party giving notice, such Borrower shall
         thereafter treat as a current liability (if not otherwise so treated)
         all liability of such Borrower that would arise by reason of the
         termination of or withdrawal from such Employee Benefit Plan if such
         plan was then terminated, and (ii) within fifteen (15) days of the
         receipt of such notice or obtaining such knowledge, furnish to the
         Administrative Agent and each Loan Party a current consolidated balance
         sheet of International with the amount of the current liability
         referred to above.

                  (i)      LANDLORD WAIVERS.

                           Each Pledging Borrower shall deliver to the
         Administrative Agent within thirty (30) Business Days of such request a
         landlord waiver substantially in the form of Exhibit G for all
         Collateral Locations which are leased by such Pledging Borrower,
         provided, however, that the Borrowers will have ninety (90) days after
         the Restatement Date to provide a landlord waiver with respect to the
         Reno, Nevada location; and provided further that no Pledging Borrower
         shall be required to deliver a landlord's waiver if (i) such Pledging
         Borrower used its best efforts to obtain such landlord's waiver in the
         form of Exhibit G but was unable to do so and (ii) the Administrative
         Agent and the Required Banks agreed in writing that such landlord's
         waiver is not required.

         6.2      AFFIRMATIVE COVENANTS.

                  (a)      CORPORATE EXISTENCE.

                           Each Borrower shall, and shall cause each Subsidiary
         to, at all times maintain its corporate existence, rights and
         franchises, except as permitted under Section 6.3(a), maintain (where
         applicable) its good standing in the jurisdiction of its incorporation,
         and qualify as a foreign corporation in each jurisdiction where failure
         to qualify could reasonably be expected to result in a Material Adverse
         Effect.

                  (b)      FINANCIAL RECORDS.

                           The Borrowers shall maintain at all times, true and
         complete financial records in accordance with GAAP, consistently
         applied, and, without limiting the generality of the foregoing, make
         appropriate accruals to reserves for estimated and contingent losses
         and liabilities as required under GAAP.

                  (c)      VISITATION.

                           Each Borrower shall, and shall cause each Subsidiary
         to, upon reasonable prior written or oral notice from the
         Administrative Agent or any Loan Party permit the Administrative Agent
         or such Loan Party, as the case may be, during normal business hours:
         (i) to examine, with the guidance and supervision of such Borrower,
         such Borrower's financial records and to make copies of and extracts
         from such records and (ii) to consult with such Borrower's and such
         Subsidiaries' officers, directors, accountants, actuaries, trustees and
         plan administrators, as the case may be, in respect of such Borrower's
         and its Subsidiaries' financial condition, each of which parties is
         hereby authorized by such Borrower to make such information available
         to the Administrative Agent or the Loan Parties to the same extent that
         it would to such Borrower.

                                       46
<PAGE>

                  (d)      COMPLIANCE WITH LAWS.

                           Each Borrower will comply, and will cause each of its
         Subsidiaries to comply, in all material respects with all applicable
         provisions of all Laws (whether statutory, administrative, judicial or
         other and whether federal, state or local and excluding Environmental
         Laws to the extent addressed in Section 6.2(e) of this Agreement) and
         every lawful governmental order; provided, however, that any alleged
         noncompliance shall not be deemed to be an Event of Default if and to
         the extent: (i) appropriate corrective measures are commenced within
         thirty (30) days after the non-compliance becomes apparent or is
         alleged, and thereafter are being diligently pursued to the
         satisfaction of, or are being corrected by procedures satisfactory to
         the court, agency or other governmental authority in question, or (ii)
         the alleged non-compliance is contested in good faith by timely and
         appropriate proceedings effective to stay the enforcement thereof or
         (iii) such noncompliance by such Borrower or such Subsidiaries, has not
         resulted or could not reasonably be expected to result in a Material
         Adverse Effect.

                  (e)      COMPLIANCE WITH ENVIRONMENTAL LAWS.

                           Each Borrower will use, and will cause each of its
         Subsidiaries to use, and operate all of its respective facilities and
         properties such that no obligation shall arise under any Environmental
         Law, including a clean-up obligation, which could reasonably be
         expected to have a Material Adverse Effect; provided, however, that if
         any Environmental Claim (regardless of whether such claim will have a
         Material Adverse Effect) is made or any such obligation (regardless of
         whether such obligation would have a Material Adverse Effect) arises,
         such Borrower and each of its Subsidiaries shall, at its own cost and
         expense, timely satisfy such claim or obligation, provided that no such
         claim or obligation need be satisfied if it is being contested in good
         faith by appropriate proceedings promptly instituted and diligently
         conducted and if such reserves or other appropriate provision, if any,
         as shall be required by GAAP shall have been made therefor; provided,
         further, that any alleged noncompliance shall not be deemed to be an
         Event of Default if and to the extent: (i) appropriate corrective
         measures are commenced within thirty (30) days after the non-compliance
         becomes apparent or is alleged, and thereafter are being diligently
         pursued to the satisfaction of, or are being corrected by procedures
         satisfactory to the court, agency or other governmental authority in
         question, or (ii) the alleged non-compliance is contested in good faith
         by timely and appropriate proceedings effective to stay the enforcement
         thereof or (iii) such noncompliance by such Borrower or such
         Subsidiaries, has not resulted or could not reasonably be expected to
         result in a Material Adverse Effect. Each Borrower will keep, and will
         cause each of its Subsidiaries to keep, all necessary Environmental
         Permits in effect and remain in material compliance therewith, and
         handle all Hazardous Materials in material compliance with all
         applicable Environmental Laws. No Borrower shall suffer to exist nor
         shall permit any of its Subsidiaries to suffer to exist, an
         environmental condition which has resulted or could result in a
         Material Adverse Effect.

                  (f)      PROPERTIES.

                           Each Borrower shall, and shall cause each Subsidiary
         to, maintain all assets necessary to its continuing operations in good
         working order and condition, ordinary wear and tear and damage by an
         insured event or casualty excepted provided, however, that the
         foregoing covenant shall not apply to Subsidiaries on an individual
         basis with sales or assets of less than Three Million Dollars
         ($3,000,000) and which Subsidiaries, when aggregated together, have
         sales or assets of less that Ten Million Dollars ($10,000,000).

                                       47
<PAGE>

                  (g)      USE OF PROCEEDS.

                           The Borrowers shall, and shall cause each Subsidiary
         to, use the proceeds of Advances as follows: (i) to support its working
         capital needs, (ii) to finance Permitted Acquisitions (iii) for general
         corporate purposes, and (iv) to finance the Recapitalization.

                  (h)      TAXES.

                           Each Borrower shall, and shall cause each Subsidiary
         to, pay in full, and shall cause each of its Subsidiaries to pay in
         full, prior in each case to the date when penalties for the nonpayment
         thereof would attach, all taxes, assessments and governmental charges
         and levies for which it may be or become subject and all lawful claims
         which, if unpaid, might become a Lien upon its property; provided,
         however, that no item need be paid so long as and to the extent that it
         is contested in good faith and by timely and appropriate proceedings
         effective to stay the enforcement thereof and appropriate reserves are
         made on the books of such Borrower or such Subsidiary and so long as it
         could not reasonably be expected to have a Material Adverse Effect.

                  (i)      INSURANCE.

                           Each Borrower shall, and shall cause each Subsidiary
         to, maintain adequate personal and real property, liability, business
         interruption and product liability insurance in such amounts and for
         such hazards and liabilities as are ordinary for similar businesses. In
         the case of any insurance relating to the Collateral, the
         Administrative Agent for the benefit of the Loan Parties shall be
         listed as loss payee, additional insured and mortgagee payee (as
         applicable). On the Restatement Date and within five (5) Business Days
         of the request by the Administrative Agent or any Loan Party
         thereafter, each Borrower shall provide evidence satisfactory to the
         Administrative Agent or such Loan Party of such insurance.

                  (j)      ADDITIONAL GUARANTORS.

                           Promptly after the consummation of a Permitted
         Acquisition the result of which is the existence of a Wholly-Owned
         Subsidiary which is not a Borrower and that has assets or projected
         annual sales in an amount in excess of Twelve Million Five Hundred
         Thousand Dollars ($12,500,000) and which is not a Non-US Subsidiary,
         the Borrowers shall cause such Subsidiary to execute and deliver to the
         Administrative Agent for the benefit of the Loan Parties a Guaranty
         Agreement guarantying the Guaranteed Obligations in the form of Exhibit
         E.

                  (k)      PLEDGE OF STOCK OF FOREIGN SUBSIDIARIES.

                           International shall pledge to the Administrative
         Agent for the benefit of the Loan Parties at least sixty-five percent
         (65%) of the stock of any Wholly-Owned direct Subsidiary of
         International which is not a Borrower and that has tangible assets in
         excess of Ten Million Dollars ($10,000,000) or annual sales in an
         amount in excess of Fifteen Million Dollars ($15,000,000) and which is
         a Non-US Subsidiary to the extent that pledging the shares will not
         create a material tax consequence to such Subsidiary or any of the
         Borrowers as determined by the Borrowers and the Administrative Agent.

                                       48
<PAGE>

         6.3      NEGATIVE COVENANTS.

                  (a)      EQUITY TRANSACTIONS.

                           No Borrower shall, and no Borrower shall permit any
         of its Subsidiaries to, (i) merge or consolidate itself with or into,
         or enter into any agreement to merge or consolidate itself with or
         into, any other Person or otherwise be a party to any merger or
         consolidation; (ii) purchase all or substantially all of the assets and
         business of another Person; or (iii) lease as lessor, sell,
         sell-leaseback or otherwise transfer (whether in one transaction or a
         series of transactions) any of its assets (whether now owned or
         hereafter acquired); or sell or otherwise transfer (or, in the case of
         a Subsidiary of any Borrower, issue) any shares of stock or other
         equity securities of any Subsidiary of any Borrower to any Person other
         than the Borrower which is the parent company of such Subsidiary.
         Notwithstanding the foregoing prohibition: (A) shares may be issued or
         transferred for the purpose of qualifying directors under applicable
         Law, (B) except that any Borrower or Subsidiary may sell, or otherwise
         dispose of assets constituting Collateral in the ordinary course of
         business, other than a sale of Accounts or General Intangibles
         constituting Collateral in connection with the factoring,
         securitization or other sale of such Accounts or General Intangibles,
         (C) other than transfers to Subsidiaries permitted by Section 6.3(d)(i)
         hereof, any Borrower or any of its Subsidiaries may sell, lease as
         lessor, sell-leaseback or otherwise transfer (whether in one
         transaction or a series of transactions) provided the proceeds (net of
         costs and expenses related to the transactions) of any such sale,
         lease, sale-leaseback or other transfer in excess of Three Million
         Dollars ($3,000,000) in any calendar year shall be paid to the
         Administrative Agent for application to the Obligations in accordance
         with Section 2.9(c) promptly after the receipt thereof and provided
         that the aggregate proceeds for all such transaction (other than
         transfers permitted by Section 6.3(d)(i)) does not exceed Ten Million
         Dollars ($10,000,000) (D) each Borrower and its Subsidiaries may make
         Permitted Acquisitions, (E) any US Subsidiary of a Borrower may merge
         or consolidate with or into, or be liquidated into, a Domestic Borrower
         or any US Subsidiary which is a Wholly-Owned Subsidiary of a Domestic
         Borrower so long as such Domestic Borrower or such US Subsidiary is the
         surviving corporation, or may dispose of its properties or assets to
         such Domestic Borrower or such US Subsidiary (whether such disposal is
         by means of lease, sale or other type of transfer except transfers of a
         type otherwise provided for in this Section 6.3(a)) (F) any Non-US
         Subsidiary of a Borrower may merge or consolidate with or into, or be
         liquidated into, a Foreign Borrower, a Subsidiary of Europa, a Domestic
         Borrower or a Subsidiary of a Domestic Borrower so long as such Foreign
         Borrower, Subsidiary of Europa, Domestic Borrower, or Subsidiary of a
         Domestic Borrower, as the case may be, is the surviving corporation, or
         may dispose of its properties or assets to such Foreign Borrower,
         Subsidiary of Europa, Domestic Borrower, or Subsidiary of a Domestic
         Borrower (whether such disposal is by means of lease, sale or other
         type of transfer except transfers of a type otherwise provided for in
         this Section 6.3(a)), and (G) without taking into consideration the
         sales or assets of Non-US Subsidiaries permitted to be merged,
         consolidated or liquidated pursuant to clause (F) above, any Non-US
         Subsidiary of a Borrower may merge or consolidate with or into, or be
         liquidated into, another Non-US Subsidiary of a Borrower so long as
         neither the sales or assets of the Non-US Subsidiaries so merged,
         consolidated, or liquidated do not exceed in the aggregate Ten Million
         Dollars ($10,000,000).

                  (b)      INDEBTEDNESS.

                           No Borrower shall, and no Borrower shall permit any
         Subsidiary to, create, assume, incur, suffer to exist or have
         outstanding at any time any Indebtedness or other debt of any kind;
         except, that this Section 6.3(b) shall not prohibit: (i) the

                                       49
<PAGE>

         Obligations, (ii) ordinary course trade payables, (iii) the
         Indebtedness on the Supplemental Schedule (which Indebtedness shall not
         be renewed or increased), (iv) Indebtedness of Domestic Borrowers or US
         Subsidiaries to other Domestic Borrowers or US Subsidiaries, (v)
         Indebtedness of Non-US Subsidiaries to other Non-US Subsidiaries, (vi)
         the Indebtedness of any Borrower or any of its Subsidiaries to an
         Affiliate of the Administrative Agent which is supported by Affiliate
         Fronting Bank LCs provided such amount does not exceed the maximum
         amount permitted for Affiliate Fronting Bank LCs pursuant to 2.11 of
         this Agreement, (vii) Indebtedness secured by a Lien permitted by
         Section 6.3(c)(G), (H) and (K) only of this Agreement (viii) subject to
         the limitations contained in Section 2.11(a) and without duplication,
         Indebtedness of (x) a Borrower comprised of Fronting Bank LCs and
         Affiliate Fronting Bank LCs issued for the benefit of Non-US
         Subsidiaries (including Europa in the case of International) (y) Europa
         comprised of Advances, and (z) Wholly-Owned Non-US Subsidiaries
         (including Europa) comprised of intercompany loans from International,
         ERICO Products or, without duplication of (y) above, Europa to the
         extent funded by Advances, and provided, that the cumulative aggregate
         amount of all such Indebtedness of all Borrowers and Subsidiaries does
         not in the aggregate exceed Fifty-Five Million Dollars ($55,000,000) at
         any one time outstanding, (ix) Indebtedness of the Borrowers to Holding
         to enable Holding to pay regularly scheduled interest payments under
         the Holding Senior Subordinated Notes; provided such Indebtedness shall
         only be to the extent and at such time as such interest is payable; (x)
         any other Indebtedness provided, that the cumulative aggregate amount
         of all such other Indebtedness of all Borrowers and Subsidiaries does
         not in the aggregate exceed Four Million Dollars ($4,000,000) at any
         one time outstanding, or (xi) Senior Subordinated Indebtedness
         provided, however, that, to the extent that the Borrowers' performance
         of or compliance with the provisions of the Senior Subordinated
         Indenture would constitute an Event of Default hereunder, such
         performance or compliance shall constitute an Event of Default despite
         the Senior Subordinated Indenture being permitted hereby.

                  (c)      LIENS; LEASES.

                           No Borrower shall, and no Borrower shall permit any
         of its Subsidiaries to, (i) acquire or hold any property subject to any
         Lien, (ii) sell or otherwise transfer any Accounts, whether with or
         without recourse, (iii) pledge or otherwise encumber the stock of any
         US Subsidiary or Non-US Subsidiary (other than the stock of ERICO
         Products and Europa pledged to the Administrative Agent pursuant to the
         Pledge Agreement - Europa), (iv) covenant to any third party not to
         pledge or otherwise encumber its property or assets, or (v) suffer or
         permit any property now owned or hereafter acquired by it to be or
         become encumbered by a Lien; provided, however, that this subsection
         shall not prohibit: (A) any Lien for a tax, assessment or government
         charge or levy for taxes, assessments or charges not yet due and
         payable, (B) any Lien securing only workers' compensation, unemployment
         insurance or similar obligations, (C) any mechanic's, carrier's,
         landlord's or similar common law or statutory Lien incurred in the
         normal course of business which has not been docketed as a judgment,
         (D) zoning or deed restrictions, public utility easements, minor title
         irregularities and similar matters having no adverse affect as a
         practical matter on the ownership or use of any of the property in
         question, (E) any Lien securing or given in lieu of surety, stay,
         appeal or performance bonds, or securing performance of contracts,
         bids, statutory obligations, surety and appeal bonds (other than
         contracts for the payment of indebtedness for borrowed money), or
         deposits required by law or governmental regulations or by any court
         order, decree, judgment or rule or as a condition to the transaction of
         business or the exercise of any right, privilege or license, (F) any
         Lien in favor of the Administrative Agent for the benefit of the Loan
         Parties or any existing Lien fully disclosed in the Supplemental
         Schedule, (G) any Lien created or assumed in purchasing, constructing
         or improving any real property or to which any real

                                       50
<PAGE>

         property is subject when purchased; provided, however, that: (x) the
         mortgage, security interest or other Lien is confined to the property
         in question and (y) the Indebtedness secured thereby does not exceed
         the total cost of the purchase, construction or improvement and (z) the
         aggregate outstanding Indebtedness secured by such Liens (when taken
         together with any secured Indebtedness permitted to be secured pursuant
         to clause (K) of this subsection) does not at any time exceed Five
         Million Dollars ($5,000,000) in the aggregate, (H) any operating lease
         entered into by the Borrower or such Subsidiary as lessee; provided,
         however, that the scheduled rental payments in respect to all such
         leases shall not exceed Seven Hundred Fifty Thousand Dollars ($750,000)
         per month in the aggregate; (I) any transfer of a check or other medium
         of payment for deposit or collection, or any similar transaction in the
         normal course of business, or (J) any financing statement perfecting a
         security interest that would be permissible under this subsection or
         (K) any Lien (including any Lien in respect of a Capitalized Lease of
         personal property) which is created in purchasing personal property;
         provided, however, that: (x) the Lien is confined to the property in
         question and (y) the Indebtedness secured thereby does not exceed the
         total cost of the purchase and (z) the aggregate outstanding
         Indebtedness secured by such Liens (when taken together with any
         secured Indebtedness permitted to be secured pursuant to clause (G) of
         this subsection) does not at any time exceed Five Million Dollars
         ($5,000,000) in the aggregate, (L) any discount sales of the accounts
         receivable of ERICO France S.a.r.l. and/or ERICO Products AG in the
         ordinary course of its business, the aggregate amount of which shall
         not exceed the Dollar Equivalent of Two Million Dollars ($2,000,000) at
         any one time outstanding and (M) any Lien on any assets other than
         assets constituting Collateral provided the aggregate amount of the
         Indebtedness or other obligation secured thereby does not exceed One
         Million Dollars ($1,000,000) at any one time outstanding.

                  (d)      INVESTMENTS.

                           Other than as disclosed in the Supplemental Schedule,
         no Borrower shall, and no Borrower shall permit any of its Subsidiaries
         to;

                  (i) make or hold any investment in any common stocks, bonds or
                  securities of any kind or make any further capital
                  contribution to any Person other than (u) the common stock of
                  its Subsidiaries existing on the Restatement Date and the
                  capital contributions therein outstanding as of the
                  Restatement Date, (v) any such investment pursuant to a
                  Permitted Acquisition and (w) notes or securities issued by a
                  customer of any Borrower or its Subsidiaries in connection
                  with a bankruptcy proceeding in respect of a customer and (x)
                  investments in or, to the extent otherwise limited hereby or
                  by Section 6.3(a) of this Agreement, accounts receivables
                  owing to Wholly-Owned Subsidiaries in the ordinary course of
                  business, including, without limitation, sales of capital
                  goods to Affiliates on a non-arm's length basis with all sales
                  that have a value of greater than Fifty Thousand Dollars
                  ($50,000) not exceeding in the aggregate at any time Two
                  Million Five Hundred Thousand Dollars ($2,500,000) to the
                  Wholly-Owned Subsidiaries located in any one country or Ten
                  Million Dollars ($10,000,000) at any one time to all
                  Wholly-Owned Subsidiaries in all countries and (y) Liquid
                  Investments and (z) accounts receivable and trade credit to
                  any Person or advances to suppliers in the ordinary course of
                  business,

                  (ii) make or keep outstanding any other advance, loan
                  (including loans to employees for the acquisition of stock of
                  any Borrower or Holding) note receivables to any Person, or be
                  or become a Guarantor of any kind other than (I) advances,
                  loans or notes receivables by a Domestic Borrower or US
                  Subsidiary to another Domestic Borrower or US Subsidiary, (II)
                  advances, loans or notes

                                       51
<PAGE>

                  receivables by a Non-US Subsidiary to another Non-US
                  Subsidiary (III) advances, loans, or notes receivable by any
                  Borrower to a Person or Persons which, together with all such
                  advances, loans, or notes receivable to such Person or
                  Persons, do not exceed One Million Dollars ($1,000,000) in the
                  aggregate, (IV) accounts receivable and trade credit or
                  advances to suppliers in the ordinary course of business, or
                  (V) loans or advances to employees in the ordinary course of
                  business, including temporary travel advances, advances on
                  bonuses that have already been earned, relocation advances and
                  advances of commissions that have already been earned or (VI)
                  advances, loans, notes receivable or Guaranties comprised of
                  (x) Fronting Bank LCs and Affiliate Fronting Bank LCs issued
                  for account of a Borrower for the benefit of Non-US
                  Subsidiaries (including Europa in the case of International)
                  (y) intercompany loans to Non-US Subsidiaries from
                  International, ERICO Products or Europa to the extent funded
                  by Advances and (z) investments or accounts receivable
                  permitted by clause (i)(x) above, provided, that the
                  cumulative aggregate amount of all such advances, loans, notes
                  receivable or Guaranties of all Borrowers and Subsidiaries, do
                  not in the aggregate (when taken together with Advances to
                  Europa, without duplication) exceed Fifty-Five Million Dollars
                  ($55,000,000) at any one time outstanding, (VII) a Guaranty of
                  the Obligations of the Borrowers to the Loan Parties under a
                  separate Guaranty Agreement by a Subsidiary and the guaranty
                  of the Guaranteed Obligations under Section 9 of this
                  Agreement by the Borrower Guarantors, (VIII) endorsements of
                  negotiable instruments, stock or other obligations received in
                  the ordinary course of business, or (IX) loans or advances by
                  the Borrowers to Holding to enable Holding to pay regularly
                  scheduled interest payments under the Holding Senior
                  Subordinated Indebtedness; provided however, that such loans
                  or advances shall be made only be to the extent and at such
                  time as such regularly scheduled interest payments are
                  payable, and provided further that the making of such loans or
                  advances do not otherwise cause an Event of Default hereunder.

                  (e)      DIVIDENDS AND MANAGEMENT FEES.

                           No Borrower shall, and no Borrower shall permit any
         of its Subsidiaries to, (i) make or commit itself to make any
         Distribution (other than stock dividends) to Holding at any time in
         excess of One Million Dollars ($1,000,000) per year and (x) dividends
         by the Borrowers in connection with the Merger on the Restatement Date
         and (y) dividends by the Borrowers to Holding to enable Holding to pay
         regularly scheduled interest payments under the Holding Senior
         Subordinated Indebtedness or (ii) pay or commit itself to pay any
         management fee to any Affiliate of such Borrower or its Subsidiaries at
         any time in excess of Five Hundred Thousand Dollars ($500,000) during
         any Fiscal Year of the Borrowers provided, however, that this provision
         shall not prohibit any Distribution from a direct or indirect
         Subsidiary of a Borrower to such Borrower or another Subsidiary of such
         Borrower, as the case may be. Further, except as provided in this
         Section 6.3(e), no Borrower shall, and no Borrower shall permit any of
         its Subsidiaries to, suffer or permit itself to be subject to any
         negative covenant in favor of a Person or Persons which limits such
         Borrower or its Subsidiaries ability to make any Distribution from a
         direct or indirect Subsidiary of a Borrower to such Borrower or another
         Subsidiary of such Borrower, as the case may be.

                  (f)      CHANGE IN NATURE OF BUSINESS.

                           No Borrower shall, and no Borrower shall permit any
         Subsidiary to, make any material change in the nature of its business
         as carried on as of the Restatement Date.

                                       52
<PAGE>

                  (g)      COMPLIANCE WITH ERISA.

                           No Borrower shall, and no Borrower shall permit any
         ERISA Affiliate to: (i) engage in any transaction in connection with
         which such Borrower or any ERISA Affiliate could reasonably be expected
         to be subject to either a civil penalty assessed pursuant to Section
         502(i) of ERISA or a tax imposed by Section 4975 of the Code, terminate
         or withdraw from any Employee Benefit Plan in a manner, or take any
         other action with respect to any such Employee Benefit Plan (including,
         without limitation, a substantial cessation of business operations or
         an amendment of an Employee Benefit Plan within the meaning of Section
         4041(e) of ERISA), which could reasonably be expected to result in any
         liability of such Borrower or any ERISA Affiliate to the PBGC, to the
         Department of Labor or to a trustee appointed under Section 4042(b) or
         (c) of ERISA, incur any liability to the PBGC on account of a
         withdrawal from or a termination of an Employee Benefit Plan under
         Section 4063 or 4064 of ERISA, incur any liability for post-retirement
         benefits under any and all welfare benefit plans (as defined in Section
         3(1) of ERISA) other than under the ERICO Health Care Plan of ERICO
         International Corporation or otherwise as required by applicable
         statute, fail to make full payment when due of all amounts which, under
         the provisions of any Employee Benefit Plan or applicable Law, such
         Borrower or any ERISA Affiliate is required to pay as contributions
         thereto, or permit to exist any Accumulated Funding Deficiency, whether
         or not waived, with respect to any Employee Benefit Plan (other than a
         Multiemployer Plan); provided, however, that such engagement,
         termination, withdrawal, action, incurrence, failure or permitting
         shall not be deemed to have violated this clause (i) unless any such
         engagement, termination, withdrawal, action, incurrence, failure or
         permitting has resulted or could reasonably be expected to result in a
         Material Adverse Effect; or (ii) at any time permit the termination of
         any defined benefit pension plan intended to be qualified under Section
         401(a) and 501(a) of the Code; provided, however, that such termination
         shall not be deemed to have violated this clause (ii) unless it has
         resulted or could reasonably be expected to result in a Material
         Adverse Effect. No Borrower shall, nor shall any Borrower permit any of
         its Subsidiaries to, become a party to or be required to contribute to
         a Multiemployer Plan.

                  (h)      REGULATION U COMPLIANCE.

                           No Borrower shall use any portion of the proceeds of
         any Advance for the purpose of purchasing or carrying any Margin Stock
         (as defined in Section 5.16 or for any other purpose in violation of
         Regulation U or of the terms and conditions of this Agreement.

                  (i)      ACCOUNTING CHANGES.

                           No Borrower shall make or permit any change in its
         accounting policies or financial reporting practices and procedures,
         except changes in accounting policies which are required or permitted
         by GAAP and changes in financial reporting practices and procedures
         which are required or permitted by GAAP, in each case as to which such
         Borrower shall have delivered to the Administrative Agent prior to the
         effectiveness of any such change a report prepared by a Responsible
         Officer of such Borrower describing such change and explaining in
         reasonable detail the basis therefor and effect thereof.

                  (j)      ARM'S-LENGTH TRANSACTIONS.

                           Subject to Section 6.3(d) of this Agreement, no
         Borrower shall, and no Borrower shall permit any of its Subsidiaries
         to, enter into or permit to exist any transaction (including, without
         limitation, any transaction involving the investment,

                                       53
<PAGE>

         purchase, sale, lease, transfer or exchange of any property or the
         rendering of any service) with any Affiliate of such Borrower except in
         the ordinary course of the business of such Borrower and its
         Subsidiaries and upon fair and reasonable terms not less favorable to
         such Borrower or any of its Subsidiaries than would be usual and
         customary in transactions with persons who are not such Affiliates;
         provided, however, that this provision shall not apply to (i) sales,
         leases, purchases, transfers or exchanges of property constituting
         Inventory or services among the Borrowers or their direct or indirect
         Wholly-Owned Subsidiaries, (ii) the transactions contemplated pursuant
         to the Recapitalization, and (iii) management fees payable pursuant to
         Section 6.3(e) hereof.

                  (k)      PAYMENT OF INDEBTEDNESS.

                           After the occurrence of an Event of Default, no
         Borrower shall, and no Borrower shall permit any of its Subsidiaries
         to, make (i) any payment in respect of any Subordinated Debt or (ii)
         any payment to Holding in respect of any Indebtedness of any Borrower
         or any Subsidiary to Holding.

                  (l)      REDEMPTION OF SENIOR SUBORDINATED NOTES.

                           International shall not (i) elect to optionally
         redeem the Senior Subordinated Notes pursuant to Section 3.07 of the
         Senior Subordinated Indenture or (ii) permit Holding to redeem the
         Holding Senior Subordinated Notes pursuant to Section 3.07 of the
         Holding Senior Subordinated Indenture.

                  (m)      DEFEASANCE UNDER THE SENIOR SUBORDINATED INDENTURE.

                           International shall not (i) elect legal defeasance or
         covenant defeasance pursuant to Sections 8.01, 8.02 or 8.03 of the
         Senior Subordinated Indenture or (ii) permit Holding to elect legal or
         covenant defeasance pursuant to Sections 8.01, 8.02 or 8.03 of the
         Holding Senior Subordinated Indenture.

                  (n)      AMENDMENT OF THE SENIOR SUBORDINATED INDENTURE AND
                           HOLDING SENIOR SUBORDINATED INDENTURE.

                           International shall not (i) amend, supplement (other
         than a supplement to add a guarantor thereunder) or waive any provision
         of the Senior Subordinated Indenture or (ii) permit Holding to amend,
         supplement (other than a supplement to add a guarantor thereunder) or
         waive any provision of the Holding Senior Subordinated Indenture
         without the written consent of the Required Banks, except with respect
         to any amendment or modification of the subordination provisions of the
         Senior Subordinated Indenture or the Holding Senior Subordinated
         Indenture, which amendment or modification shall require the written
         consent of the Loan Parties.

                  (o)      PLEDGE OF STOCK OF FOREIGN SUBSIDIARIES.

                           To the extent that International has not pledged the
         stock of its Wholly-Owned direct Non-US Subsidiaries (other than
         Europa) pursuant to Section 6.2(k), the Borrowers shall not permit (i)
         the tangible assets of such Non-US Subsidiaries to exceed Twenty
         Million Dollars ($20,000,000) in the aggregate or (ii) the annual sales
         of such Non-US Subsidiaries to exceed Thirty-Five Million Dollars
         ($35,000,000) in the aggregate.

                                       54
<PAGE>

         6.4      FINANCIAL COVENANTS.

                  (a)      CONSOLIDATED NET WORTH.

                           The Borrowers shall not permit the Consolidated Net
         Worth of International and its consolidated Subsidiaries: (i) as of the
         Restatement Date, to be less than Fifty-Four Million Dollars
         ($54,000,000) (the "Fiscal 2002 Net Worth Amount") and as of each
         Fiscal Quarter ending after December 31, 2002, not less than the sum
         of:

                  the Fiscal 2002 Net Worth Amount plus

                  an aggregate amount equal to fifty percent (50%) of
                  Consolidated Net Income (if any and only to the extent a
                  positive number) attributable to each Fiscal Year ending after
                  December 31, 2002 (which aggregate amount shall not be reduced
                  by any consolidated net losses reported for any Fiscal Year
                  ending after December 31, 2002), plus

                  if such date is during and not at the end of a Fiscal Year, an
                  amount equal to fifty percent (50%) of the Consolidated Net
                  Income (if any and only to the extent a positive number) for
                  the fiscal period consisting of the Fiscal Quarters of such
                  Fiscal Year that have ended on or before such date.

                  (b)      CONSOLIDATED FIXED CHARGE COVERAGE RATIO.

                           The Borrowers shall not permit the Consolidated Fixed
         Charge Coverage Ratio as at the end of each Cumulative Four Quarter
         Period to be less than 1.2 to 1.00.

                  (c)      CONSOLIDATED FUNDED DEBT TO EBITDA RATIO.

                           The Borrowers shall not permit the Consolidated
         Funded Debt to EBITDA Ratio as at the end of each Cumulative Four
         Quarter Period to exceed (i) 4.50 to 1.00 for the Cumulative Four
         Quarter Periods ending prior to December 31, 2003, (ii) 4.25 to 1.00
         for each such Cumulative Four Quarter Period ending on December 31,
         2003 and prior to December 31, 2004, (iii) 4.00 to 1.00 for the such
         Cumulative Four Quarter Period ending on December 31, 2004 and prior to
         December 31, 2005 and (iv) 3.75 to 1.00 on December 31, 2005 and
         thereafter.

                  (d)      CONSOLIDATED FUNDED DEBT TO EBITDA OF ERICO PRODUCTS
                           RATIO.

                           The Borrowers shall not permit the Consolidated
         Funded Debt to EBITDA of ERICO Products Ratio as at the end of each
         Cumulative Four Quarter Period to exceed (i) 4.50 to 1.00 for the
         Cumulative Four Quarter Periods ending prior to December 31, 2003, (ii)
         4.25 to 1.00 for each such Cumulative Four Quarter Period ending on
         December 31, 2003 and prior to December 31, 2004, (iii) 4.00 to 1.00
         for the such Cumulative Four Quarter Period ending on December 31, 2004
         and prior to December 31, 2005, and (iv) 3.75 to 1.00 on December 31,
         2005 and thereafter.

                  (e)      CONSOLIDATED SENIOR FUNDED DEBT TO EBITDA RATIO.

                           The Borrowers shall not permit the Consolidated
         Senior Funded Debt to EBITDA Ratio as at the end of each Cumulative
         Four Quarter Period to exceed (i) 3.00 to 1.00 for the Cumulative Four
         Quarter Periods ending prior to December 31, 2003, (ii) 2.75 to 1.00
         for each such Cumulative Four Quarter Period ending on December 31,
         2003

                                       55
<PAGE>

         and prior to December 31, 2004, and (iii) 2.50 to 1.00 on December 31,
         2004 and thereafter.

                  (f)      MINIMUM CONSOLIDATED EBITDA.

                           The Borrowers shall not permit the Consolidated
         EBITDA as at the end of each Cumulative Four Quarter Period to be less
         than (i) $33,000,000 for the Cumulative Four Quarter Periods ending
         prior to December 31, 2003, (ii) $40,000,000 for each such Cumulative
         Four Quarter Period ending on December 31, 2003 and prior to December
         31, 2004, and (iii) $45,000,000 on December 31, 2004 and thereafter.

SECTION 7         EVENTS OF DEFAULT.

         The occurrence of any one or more of the following events shall
constitute an "Event of Default":

         7.1      PAYMENT.

                  Failure by any Borrower to: (a) make payment of principal on
any Revolving Credit Note or Term Note when due or (b) pay any interest or any
amounts owing under Section 2.12 when required to be paid hereunder or under any
Guaranty to the extent such failure is not remedied within five (5) Business
Days after such required date of payment hereunder or thereunder; or

         7.2      REPRESENTATIONS AND WARRANTIES.

                  Any warranty or representation made or deemed made by a
Borrower in respect of any Borrower, any Subsidiary of any Borrower or any
Guarantor in this Agreement, in any Loan Document or any certificate, document
or financial or other statement furnished at any time in compliance with or
pursuant to this Agreement shall prove to have been false or inaccurate in any
material respect when made or deemed made; or

         7.3      REPORTING AND NOTICE PROVISIONS; VIOLATION OF CERTAIN
                  AFFIRMATIVE COVENANTS.

                  Failure by any Borrower (where applicable, in respect of such
Borrower, any Subsidiary of such Borrower or any Guarantor): (a) to perform,
keep, or observe any other term, provision, condition or covenant contained in
Section 6.1(e) through 6.1(h) of this Agreement which is required to be
performed, kept, or observed by the Borrower (in respect of the Borrower, any
Subsidiary of the Borrower or any such Guarantor) and such failure shall
continue without remedy for a period of fifteen (15) Business Days, or (b) to
perform, keep or observe any other term, provision, condition or covenant
contained in this Agreement (other than those provisions, terms or conditions
referenced in Sections 7.1, 7.2 and 7.4 of this Agreement) that is required to
be kept or observed by a Borrower (where applicable, in respect of such
Borrower, any Subsidiary of such Borrower or any such Guarantor) and such
failure shall continue without remedy for a period of fifteen (15) Business
Days; or

         7.4      VIOLATION OF NEGATIVE COVENANTS, CERTAIN AFFIRMATIVE COVENANTS
                  AND FINANCIAL COVENANTS.

                  Failure by a Borrower (in respect of such Borrower, any
Subsidiary of such Borrower or any Guarantor) to perform, keep, or observe any
term, provision, condition or

                                       56
<PAGE>

covenant contained in Sections 6.1(a) through 6.1(d) or 6.2(a), 6.2(d), 6.2(e),
6.3 or 6.4 of this Agreement which is required to be performed, kept, or
observed by such Borrower (where applicable, in respect of such Borrower, any
Subsidiary of such Borrower or any such Guarantor), except as otherwise provided
in Section 6.2(d) or 6.2(e); or

         7.5      OTHER LOAN DOCUMENTS.

                  Failure by a Borrower, any Subsidiary of such Borrower or any
Guarantor to perform, keep, or observe any other term, provision, condition or
covenant contained in this Agreement or any of the Loan Documents which is
required to be performed, kept, or observed by such Borrower, any Subsidiary of
such Borrower or any such Guarantor (other than those provisions, terms or
conditions referenced in Sections 7.1 through 7.4 of this Agreement) and such
failure shall continue without remedy for a period of twenty (20) Business Days;
or

         7.6      CROSS-DEFAULT.

                  Default (i) by any Borrower or any Substantial Guarantor in
respect of any Indebtedness of such Borrower or Subsidiary in excess of One
Million Dollars ($1,000,000) in the aggregate where such default could permit
the holder of such other Indebtedness to accelerate such Indebtedness or any
portion thereof to the extent such default has not been waived (ii) by any
Borrower or any Subsidiary in respect to Indebtedness to the Administrative
Agent or any of its Affiliates where such default could permit the holder of
such Indebtedness to accelerate such Indebtedness or any portion thereof to the
extent such default has not be waived, (iii) by Holding in respect of the
Holding Senior Subordinated Indebtedness; or

         7.7      MATERIAL ADVERSE EFFECT.

                  The occurrence of any Material Adverse Effect; or

         7.8      CONTROL.

                  The occurrence of any Change in Control; or

         7.9      FAILURE OF ENFORCEABILITY OF THIS AGREEMENT, CREDIT DOCUMENT;
                  SECURITY.

                  If: (a) any covenant, material agreement or any Obligation of
any Borrower or any Guarantor contained in or evidenced by this Agreement or any
of the Loan Documents shall cease to be enforceable, or shall be determined to
be unenforceable, in accordance with its terms, or (b) a Borrower or any
Guarantor shall deny or disaffirm its obligations under this Agreement or any of
the Loan Documents or any of the Liens granted in connection therewith, or (c)
any Liens in favor of the Administrative Agent granted in this Agreement or any
of the Loan Documents shall be determined to be void, voidable or invalid, or
are subordinated or not otherwise given the priority contemplated by this
Agreement, or (d) any perfected Liens granted in favor of the Administrative
Agent for the benefit of the Loan Parties shall be determined to be unperfected
except in the normal course of the business of a Borrower as expressly
contemplated and permitted by this Agreement and the Loan Documents, or (e) any
Guarantor of the Obligations of a Borrower shall revoke or default under any
Guaranty; or

         7.10     ERISA.

                  If: (a) a Borrower or any of its ERISA Affiliates or any other
Person institutes any steps to terminate an Employee Benefit Plan of such
Borrower (other than the ERICO Products Defined Benefit Plan) or ERISA
Affiliates and, as a result of such termination such Borrower or ERISA Affiliate
is or could reasonably be expected to be required to make a contribution to such

                                       57
<PAGE>

Employee Benefit Plan the payment of which, when taken together with all like
terminations suffered by such Borrower, either has resulted or could reasonably
be expected to result in a Material Adverse Effect or (b) such Borrower or ERISA
Affiliate fails to make a contribution to any Employee Benefit Plan which
failure would be sufficient to give rise to a Lien under Section 302(f) of
ERISA; or

         7.11     JUDGMENTS.

                  Any money judgment, writ or warrant of attachment or similar
process involving an amount in excess of One Million Dollars ($1,000,000),
individually or in the aggregate, when taken together with all such judgments,
writs, warrants or similar process shall be issued or levied against a Borrower
or any of its Subsidiaries or any Guarantor or against any of a Borrower's or
its Subsidiaries' or any Guarantor's assets and is not released, discharged,
vacated, fully bonded or stayed within thirty (30) days after such judgment,
writ or warrant of attachment or similar proceeding, unless such judgment, writ
or warrant of attachment or other similar proceeding (a) shall have been
reserved for by such Borrower on the date hereof and such judgment does not
exceed One Million Dollars ($1,000,000), or (b) shall be insured and the
insurance carrier shall have acknowledged coverage in the amount of the
insurance without any reservation of rights or shall have been ordered by a
court of competent jurisdiction to pay such judgment; or

         7.12     FORFEITURE PROCEEDINGS.

                  An adjudication against a Borrower, any Subsidiary of a
Borrower or any Guarantor in any criminal proceedings requiring a Borrower's
forfeiture of any material asset or assets; or

         7.13     FINANCIAL IMPAIRMENT.

                  The Financial Impairment of a Borrower, a Subsidiary of a
Borrower, or any Guarantor of the Obligations.

SECTION 8         REMEDIES.

         8.1      OPTIONAL DEFAULTS.

                  Upon the occurrence of an Event of Default described above in
Sections 7.1 through 7.12 above, inclusive, the Administrative Agent may, with
the consent of the Required Banks, and shall, upon the direction of the Required
Banks, (a) declare all of the Obligations due or to become due from the
Borrowers to the Administrative Agent and the Loan Parties, whether under this
Agreement, the Revolving Credit Notes, the Term Notes or otherwise, at the
option of the Administrative Agent, immediately due and payable, anything in the
Revolving Credit Notes, the Term Notes or other evidence of the Obligations or
in any of the other Loan Documents to the contrary notwithstanding, (b)
terminate each Bank's Revolving Credit Commitment whereupon none of the Banks
shall have any further obligation to make any Revolving Credit Advance
hereunder, (c) terminate the Issuing Banks obligation to issue any Letters of
Credit, and (d) terminate each Bank's obligation to participate in Letters of
Credit issued after such termination of the Issuing Banks obligation to issue
Letters of Credit.

         8.2      AUTOMATIC DEFAULTS.

                  If any Event of Default referred to in Section 7.13 of this
Agreement shall occur, (a) each Bank's Revolving Credit Commitment shall
automatically and immediately terminate (if not already expired or terminated by
the Borrowers or terminated pursuant to this Section 8)

                                       58
<PAGE>

whereupon no Bank shall have any obligation thereafter to make any Revolving
Credit Advance hereunder, (b) the Issuing Banks' obligations to issue Letters of
Credit shall automatically and immediately terminate (if not already expired or
terminated by the Borrowers or terminated pursuant to this Section 8 and (c) all
of the Obligations and all other Indebtedness, if any, then owing to the Loan
Parties (other than Indebtedness, if any, already due and payable) shall
thereupon become and thereafter be immediately due and payable in full, all
without any presentment, demand or notice of any kind, which are hereby waived
by the Borrowers.

         8.3      GENERAL RIGHTS AND REMEDIES OF ADMINISTRATIVE AGENT AND THE
                  BANKS.

                  With respect to the Collateral, the Administrative Agent shall
have all of the rights and remedies of a secured party under the UCC or under
other applicable Law. The Administrative Agent and the Loan Parties shall have
all other legal and equitable rights to which the Administrative Agent and the
Loan Parties may be entitled, all of which rights and remedies shall be
cumulative, and none of which shall be exclusive, to the extent permitted by
law, in addition to any other rights or remedies contained in this Agreement or
in any of the other Loan Documents. Each Loan Party hereby expressly agrees
that, unless requested by the Administrative Agent, upon the concurrence of the
Required Banks, none of the Loan Parties will take or cause to be taken, in
respect of the Advances or the other Obligations or the Collateral, any action
or remedy that is independent from the actions or remedies taken or to be taken
by the Administrative Agent, except for any actions taken by any Loan Party in
connection with any Event of Default described in Section 7.13 of this Agreement
(other than a Financial Impairment caused by any judgment within the meaning of
clause (h) of the definition of Financial Impairment).

         8.4      EXERCISE OF ADDITIONAL REMEDIES.

                  Upon the occurrence of an Event of Default which has not been
waived in accordance with Section 13.1 of this Agreement, to the extent
permitted by applicable law and in addition to any other right or remedy
provided for in this Agreement, the Administrative Agent may, after declaring
the Obligations to be immediately due and payable upon direction of the Required
Banks pursuant to Section 8.1 of this Agreement, and shall, upon the direction
of the Required Banks, exercise the following rights and remedies:

                  (a)      POSSESSION OF COLLATERAL.

                           The Administrative Agent shall have the right to take
         immediate possession of the Collateral and all proceeds relating to
         such Collateral and: (i) require each Borrower, at such Borrower's
         expense, to assemble the Collateral of such Borrower and make it
         available to the Administrative Agent at such Borrower's place of
         business nearest the location of such Collateral (or such other
         location as the Administrative Agent shall approve) or (ii) enter any
         of the premises of each Borrower or wherever any Collateral shall be
         located and to keep and store the same on such premises until sold. If
         the premises on which the Collateral is located is owned or leased by a
         Borrower, then such Borrower shall not charge the Administrative Agent
         for storage of such Collateral on such premises.

                  (b)      FORECLOSURE OF LIENS.

                           The Administrative Agent shall have the right to
         foreclose the Liens created under this Agreement and each of the other
         Loan Documents or under any other agreement relating to the Collateral.

                                       59
<PAGE>

                  (c)      DISPOSITION OF COLLATERAL.

                           The Administrative Agent shall have the right to sell
         or to otherwise dispose of all or any Collateral in its then condition,
         or after any further manufacturing or processing thereof, at public or
         private sale or sales, wholesale dispositions, or sales pursuant to one
         or more contracts, with such notice as may be required by law, in lots
         or in bulk, for cash or on credit, all as the Administrative Agent, in
         its discretion, may deem advisable. Each Borrower acknowledges and
         covenants that ten (10) days written notice to such Borrower of any
         public or private sale or other disposition of Collateral shall be
         reasonable notice thereof, and such sale shall be at such Borrower's
         premises or at such other locations where the Collateral then is
         located, or as otherwise determined by the Administrative Agent. The
         Administrative Agent shall have the right to conduct such sales on each
         Borrower's premises, without charge therefor, and such sales may be
         adjourned from time to time in accordance with applicable law without
         further requirement of notice to such Borrower. The Administrative
         Agent shall have the right to bid (including bidding in Indebtedness
         owing to the Administrative Agent) at any such public sale on its own
         behalf.

                  (d)      NOTIFICATION OF ACCOUNT DEBTORS.

                           The Administrative Agent shall have the right to
         notify Account Debtors and other Persons indebted to each Borrower of
         the Administrative Agent's interest in any such amounts payable to such
         Borrower and to instruct such Account Debtors and other Persons to
         remit such amounts directly to the Administrative Agent for the benefit
         of the Loan Parties, and, upon collection of the same and deposit into
         the Cash Collateral Account, all funds arising therefrom (less any
         costs of collection and other charges or expenses incurred in
         connection therewith as hereinafter provided) in immediately available
         funds, the same being subject to application to the Obligations.

                  (e)      APPLICATION OF COLLATERAL.

                           The Administrative Agent, with or without proceeding
         with sale or foreclosure or demanding payment of the Obligations, shall
         have the right, without notice, at any time, to appropriate and apply
         to any Obligations any and all Collateral in the possession of the
         Administrative Agent.

         8.5      LIMITED LICENSE TO LIQUIDATE.

                  Each Borrower hereby grants to the Administrative Agent and
its agents: (a) a non-exclusive, royalty-free license or other right to use,
without charge, the Intellectual Property owned by each Borrower or used by such
Borrower pursuant to licenses thereof (but only to the extent that a sub-license
may be granted under such licenses (including all rights of use of any name or
trade secret): (i) to use, sell or otherwise transfer any and all Inventory of
such Borrower constituting Collateral which may bear or utilize any of the
Borrower's Intellectual Property; (ii) to use or sell any such work-in-process,
raw material or completed or finished products; (iii) to accept any and all
orders or shipments of products ordered by such Borrower from manufacturers and
(iv) to use or sell any such products bearing or utilizing any of the Borrower
Intellectual Property and (v) to manufacture and advertise for sale the
Collateral; provided, however, that such license and right to use shall be
exercisable by the Administrative Agent only after the occurrence of an Event of
Default which has not been waived in accordance with Section 13.1 of this
Agreement, and (b) to the extent permitted thereunder, all of such Borrower's
rights under all licenses and all franchise agreements which shall inure to the
Administrative Agent without charge but only after the occurrence of an Event of
Default which has not been waived in accordance with Section 13.1 of this
Agreement.

                                       60
<PAGE>

         8.6      SET-OFF.

                  If any Event of Default referred to in Section 7 of this
Agreement shall occur which has not been waived in accordance with Section 13.1
of this Agreement, the Administrative Agent shall have the right (in addition to
such other rights as it may have by operation of Law or otherwise) at any time
to set off against and to appropriate and apply toward the payment of the
Obligations and all other Indebtedness then owing to it, whether or not the same
shall then have matured, any and all deposit balances then owing by the
Administrative Agent to or for the credit or account of a Borrower, all without
notice to or demand upon any Borrower or any other Person, all such notices and
demands being hereby expressly waived.

         8.7      AUTHORITY TO EXECUTE TRANSFERS.

                  Without limitation of any authorization granted to the
Administrative Agent hereunder, each Borrower also hereby authorizes the
Administrative Agent, upon the occurrence and continuance of an Event of
Default, to execute, in connection with the exercise by the Administrative Agent
of its remedies hereunder, any endorsements, assignments or other instruments of
conveyance or transfer with respect to the Collateral.

         8.8      TERMINATION; EFFECT ON BORROWER OBLIGATIONS.

                  Any termination by the Administrative Agent of its performance
pursuant to this Section 8 shall not absolve, release, or otherwise affect the
liability of any Borrower in respect of transactions prior to such termination
or affect any of the Liens, rights, powers, and remedies of the Administrative
Agent, which such Liens, rights, powers and remedies shall, in all events,
continue until all Obligations of each Borrower to the Administrative Agent and
the Loan Parties are satisfied.

         8.9      ACTIONS IN RESPECT OF THE LETTERS OF CREDIT UPON DEFAULT.

                  Upon the occurrence of an Event of Default (unless waived in
accordance with Section 13.1 of this Agreement), to the extent that any Letters
of Credit have been issued for the account of any Borrower which then are
outstanding, the Administrative Agent may (whether in addition to taking any of
the actions described in this Section 8 or otherwise), make demand upon such
Borrower to, and forthwith upon such demand such Borrower will, pay to the
Administrative Agent in same day funds in the currency in which such Letter of
Credit is denominated, for deposit in a special cash collateral account (the
"Letter of Credit Collateral Account"), to secure the obligations of such
Borrower in respect of any outstanding Letters of Credit, to be maintained at
such office of the Administrative Agent as the Administrative Agent shall
direct, an amount equal to the maximum amount available to be drawn under the
Letters of Credit. In the event that such Borrower shall not deposit such funds
upon demand by the Administrative Agent, the Administrative Agent may, in its
sole discretion, deposit collections or any other funds of such Borrower in the
possession of the Administrative Agent to the Letter of Credit Collateral
Account until the amount deposited in such account equals the maximum amount
available to be drawn under the Letters of Credit. The Letter of Credit
Collateral Account shall be in the name of Administrative Agent for the benefit
of the Loan Parties (as a cash collateral account), but under the sole dominion
and control of the Administrative Agent and subject to the terms of this
Agreement.

                                       61
<PAGE>

         8.10     LETTER OF CREDIT COLLATERAL ACCOUNT.

                  (a)      APPLICATION.

                           The Administrative Agent may, at any time or from
         time to time after funds are deposited in the Letter of Credit
         Collateral Account, apply funds then held in the Letter of Credit
         Collateral Account to the payment of any amounts, in such order as the
         Administrative Agent may elect, as shall have become or shall become
         due and payable by a Borrower to the Bank under this Agreement or any
         Letter of Credit Facility Application first, in respect of the Letters
         of Credit and second, after the occurrence and during the continuance
         of any Event of Default, in respect of all other amounts constituting
         Obligations.

                  (b)      NO BORROWER OR THIRD PARTY CLAIMS.

                           No Borrower nor any Person claiming on behalf of or
         through a Borrower shall have any right to withdraw any of the funds
         held in the Letter of Credit Collateral Account until all Obligations
         have been paid in full, the Revolving Credit Commitment has been
         terminated, and no LC Exposure exists.

                  (c)      NO LIENS OR TRANSFERS OF ACCOUNT.

                           Each Borrower agrees that it will not: (i) sell or
         otherwise dispose of any interest in the Letter of Credit Collateral
         Account or any funds held therein, or (ii) create or permit to exist
         any lien, security interest or other charge or encumbrances upon or
         with respect to the Letter of Credit Collateral Account or any funds
         held therein, except as provided in or contemplated by this Agreement.

                  (d)      REASONABLE CARE.

                           The Administrative Agent shall exercise reasonable
         care in the custody and preservation of any funds held in the Letter of
         Credit Collateral Account and shall be deemed to have exercised such
         care if such funds are accorded treatment substantially equivalent to
         that which the Administrative Agent accords its own property, it being
         understood that the Administrative Agent shall not have any
         responsibility for taking any necessary steps to preserve rights
         against any parties with respect to any such funds.

         8.11     REMEDIES CUMULATIVE.

                           The above-stated remedies are not intended to be
         exhaustive and the full or partial exercise of any of such remedies
         shall not preclude the full or partial exercise of any other remedy by
         the Bank under this Agreement, under any Loan Document, or in equity or
         at law.

SECTION 9         BORROWER GUARANTY.

         9.1      CROSS-GUARANTY.

                  To induce the Administrative Agent and the Loan Parties to
make the Advances to the Borrowers, to induce the Affiliates of the
Administrative Agent to make the Affiliate Loans and to induce the Issuing Banks
to issue Letters of Credit, and in consideration thereof, each of the Borrower
Guarantors, jointly and severally, hereby unconditionally and irrevocably: (a)
guarantees to the Administrative Agent and the Loan Parties the due and punctual
payment in immediately available funds of all Obligations and of all other sums
now or hereafter owed by

                                       62
<PAGE>

any Borrower to the Administrative Agent or any of the Loan Parties under this
Agreement or any of the Loan Documents (whether by acceleration or otherwise),
(b) guarantees to the Administrative Agent and its Affiliates the due and
punctual payment in immediately available funds of all Indebtedness and of all
other sums now or hereafter owed by any Borrower or any of its Subsidiaries to
the Administrative Agent or any of its Affiliates ("Affiliate Loans") related to
such Loans and (c) agrees to pay any and all expenses which may be incurred by
the Administrative Agent in enforcing its rights with respect to such
Obligations (collectively, the "Guaranteed Obligations").

         9.2      MAXIMUM LIABILITY.

                  Solely in the event it is necessary for the enforceability of
a Borrower Guaranty, the maximum liability of a Borrower Guarantor under its
Borrower Guaranty for Guaranteed Obligations of the other Borrowers or their
Subsidiaries shall be the greatest amount which, after taking into consideration
all other valid and enforceable debts and liabilities of such Borrower
Guarantor, an applicable court has determined (after any appeals) would not
render such Borrower Guarantor insolvent, unable to pay its debts as they become
due, inadequately capitalized for the business which it intends to conduct (in
all such cases, within the meaning of Section 548 of the Bankruptcy Code, 11
U.S.C. Section 101, et. seq., or any other similar state law), or unable to pay
a judgment rendered upon a claim that is the subject of an action or proceeding
pending at the time when the obligations of this Borrower Guaranty are incurred
or increased.

         9.3      GUARANTY UNCONDITIONAL.

                  The obligations of the Borrower Guarantors under this Borrower
Guaranty shall be, joint and several, irrevocable, unconditional and absolute
and, without limiting the generality of the foregoing, shall not be released,
discharged or otherwise affected by (i) any extension, renewal, settlement,
compromise, waiver or release in respect of any obligation of any advance under
this Agreement or any Loan Document or any document in respect of an Affiliate
Loan by operation of Law or otherwise; (ii) any modification or amendment of or
supplement to this Agreement or any Loan Document or any document in respect of
any Affiliate Loan; (ii) any modification, amendment, waiver, release,
non-perfection or invalidity of any direct or indirect security, or of any
guarantee or other liability of any third party, of the Guaranteed Obligations
of any Borrower or its Subsidiary; (iii) any change in the corporate existence,
structure, or ownership of, or any insolvency, bankruptcy, reorganization or
other similar proceeding affecting any Borrower Guarantor or its assets or any
resulting release or discharge of any of the Obligations of the Borrower
Guarantors contained in this Agreement or any Loan Document; (iv) the existence
of any claim, set-off or other rights which International may have at any time
against the Administrative Agent or any Loan Party or any other Person, whether
or not arising in connection with this Agreement or any Loan Document, provided,
however, that nothing herein shall prevent the assertion of any such claim by
separate suit or compulsory counterclaim; (v) any invalidity or unenforceability
relating to or against any Borrower or its Subsidiary for any reason of this
Agreement or any Loan Document or any document in respect of an Affiliate Loan
or any provision of applicable law or regulation purporting to prohibit the
payment by any Borrower under this Agreement or any Loan Document; or (vi) to
the extent permitted by applicable Law, any other act or omission to act or
delay of any kind by a Borrower Guarantor, the Administrative Agent, any Loan
Party or any other Person or any other circumstance whatsoever that might, but
for the provisions of this paragraph, constitute a legal or equitable discharge
of the Guaranteed Obligations of any Borrower under Section 9.

         9.4      DISCHARGE; REINSTATEMENT.

                  The Guaranteed Obligations of each Borrower Guarantor under
this Section 9 shall remain in full force and effect until the Revolving Credit
Commitment and the LC

                                       63
<PAGE>

Exposure are terminated, all Letters of Credit are expired or terminated and the
Obligations and all amounts payable by any Borrower or any Subsidiary of any
Borrower under this Agreement or any other Loan Document or any document in
respect of an Affiliate Loan shall have been paid in full. If at any time any
payment of any amount payable by Borrower Guarantor under this Section 9, any
other Section of this Agreement or other Loan Document is rescinded or must be
otherwise restored or returned upon the insolvency, bankruptcy or reorganization
of any Borrower Guarantor or otherwise, the other Borrower Guarantor's
obligations under this Section 9 with respect to such payment shall be
reinstated at such time as though such payment had become due but had not been
made at such time. This Section 9 shall survive the termination of this
Agreement until the payment in full of all amounts payable under this Agreement
and any Loan Documents.

         9.5      WAIVER.

                  No Borrower Guarantor shall have any right of subrogation,
reimbursement or contribution. Each Borrower Guarantor hereby waives any right
to enforce any remedy which the Administrative Agent or any Loan Party now has
or may hereafter have against any Borrower, any endorser or any Guarantor or
Borrower Guarantor, of all or any part of the Obligations. Each Borrower
Guarantor hereby waives any benefit of, and any right to participate in, any
security or collateral given to the Administrative Agent for the benefit of the
Loan Parties to secure payment of the Guaranteed Obligations or any other
liability of any Borrower, any Guarantor or any Borrower Guarantor to the
Administrative Agent or any Loan Party. Each Borrower Guarantor also waives all
setoffs and counterclaims and all presentments, demands for performance, notices
of nonperformance, protests, notices of protest, notices of dishonor, and
notices of acceptance of this Borrower Guaranty. Each Borrower Guarantor further
waives all notices of the existence, creation or incurring of new or additional
indebtedness, arising either from additional loans extended to any other
Borrower or Borrower Guarantor or otherwise, and also waives all notices that
the principal amount, or any portion thereof, and/or any interest on any
instrument or document evidencing all or any part of the Guaranteed Obligations
is due, notices of any and all proceedings to collect from the maker, any
endorser or any other guarantor of all or any part of the Guaranteed
Obligations, or from anyone else, and, to the extent permitted by law, notices
of exchange, sale, surrender or other handling of any security or other
collateral given to the Administrative Agent for the benefit of the Loan Parties
to secure payment of the Guaranteed Obligations.

         9.6      STAY OF ACCELERATION.

                  If acceleration of the time for payment of any amount payable
by any Borrower Guarantor under this Agreement or other Loan Document or any
document in respect of an Affiliate Loan is stayed upon the insolvency,
bankruptcy or reorganization of any Borrower Guarantor all such amounts
otherwise subject to acceleration under the terms of this Agreement shall
nonetheless be payable by the other Borrower Guarantors hereunder forthwith on
demand by the Administrative Agent.

SECTION 10        THE ADMINISTRATIVE AGENT.

         10.1     THE ADMINISTRATIVE AGENT.

                  Each Loan Party irrevocably appoints the Administrative Agent
to act as agent under this Agreement and the Loan Documents for the benefit of
such Loan Party, with full authority to take such actions, and to exercise such
powers, on behalf of the Loan Parties in respect of this Agreement and the Loan
Documents as are herein and therein respectively delegated to the Administrative
Agent or as are reasonably incidental to those delegated powers.

                                       64
<PAGE>

The Administrative Agent in such capacity shall be deemed to be an independent
contractor of the Loan Parties.

         10.2     LEAD ARRANGER.

                  Each Bank hereby irrevocably designates and appoints LaSalle
as Lead Arranger (the "Lead Arranger") to act as specified herein and in the
other Loan Documents, and each such Bank hereby irrevocably authorizes the Lead
Arranger to take such action on its behalf under the provisions of this
Agreement and the other Loan Documents and to exercise such powers and perform
such duties as are expressly delegated to the Lead Arranger by the terms of this
Agreement and the other Loan Documents, together with such other powers as are
reasonably incidental thereto.

         10.3     NATURE OF APPOINTMENT.

                  Neither the Administrative Agent nor the Lead Arranger shall
have any fiduciary relationship with any Bank or any Issuing Bank by reason of
this Agreement and the other Loan Documents. Neither the Administrative Agent
nor the Lead Arranger shall have any duty or responsibility whatsoever to any
Bank or the Issuing Bank except those expressly set forth in this Agreement and
the other Loan Documents. Without limiting the generality of the foregoing, each
Bank and each Issuing Bank acknowledges that the Administrative Agent and the
Lead Arranger, as the case may be, is acting as such solely as a convenience to
the Banks and not as a manager of the Revolving Credit Commitments or the
Obligations evidenced by the Revolving Credit Notes or the Term Notes. This
Section 10 does not confer any rights upon any Borrower or anyone else (except
the Banks and other Loan Parties), whether as a third party beneficiary or
otherwise.

         10.4     ADMINISTRATIVE AGENT AS A BANK; OTHER TRANSACTIONS.

                  The Administrative Agent's rights as a Bank and an Issuing
Bank under this Agreement and the Loan Documents shall not be affected by its
serving as the Administrative Agent. The Administrative Agent and its Affiliates
may generally transact any banking, financial, trust, advisory or other business
with any Borrower (including, without limitation, the acceptance of deposits,
the extension of credit and the acceptance of fiduciary appointments) without
notice to the Banks or any other Loan Party, without accounting to the Banks or
any other Loan Party, and without prejudice to the Administrative Agent's rights
as a Bank under this Agreement and the Loan Documents except as may be expressly
required under this Agreement.

         10.5     INSTRUCTIONS FROM BANKS.

                  The Administrative Agent shall not be required to exercise any
discretion or take any action as to matters not expressly provided for by this
Agreement and the Loan Documents (including, without limitation, collection and
enforcement actions in respect of any Obligations under the Revolving Credit
Notes, or Term Notes or this Agreement and any collateral therefor) except that
the Administrative Agent shall take such action (or omit to take such action)
other than actions referred to in Section 11.1 of this Agreement, as may be
reasonably requested, with instructions in writing, by the Required Banks or all
of the Banks, as applicable pursuant to Section 13.1 of this Agreement and which
actions and omissions shall be binding upon all of the Banks; provided, however,
that the Administrative Agent shall not be required to act (or omit any act) if,
in its judgment, any such action or omission might expose the Administrative
Agent to personal liability or might be contrary to this Agreement, any Loan
Document or any applicable Law.

                                       65
<PAGE>

         10.6     BANK'S DILIGENCE.

                  Each Loan Party: (a) represents and warrants that it has made
its decision to enter into this Agreement and the Loan Documents and (b) agrees
that it will make its own decision as to taking or not taking future actions in
respect of this Agreement and the Loan Documents; in each case without reliance
on the Administrative Agent, the Lead Arranger or any other Bank or any other
Loan Party and on the basis of its independent credit analysis and its
independent examination of and inquiry into such documents and other matters as
it deems relevant and material. Each Loan Party confirms to the Administrative
Agent and the Lead Arranger that it has not relied, and will not hereafter rely,
on the Administrative Agent or the Lead Arranger (i) to check or inquire on such
Loan Party's behalf into the adequacy, accuracy or completeness of any
information provided by any Borrower or any other Person under or in connection
with the Loan Documents or the transactions herein contemplated (whether or not
such information has been or is hereafter distributed to such Loan Party by the
Administrative Agent or the Lead Arranger), or (ii) to assess or keep under
review on such Bank's behalf the financial conditions, creditworthiness,
condition, affairs, status or nature of any Borrower or any Subsidiary. Except
for notices, reports and other documents expressly herein required to be
furnished to the Banks or Loan Parties by the Administrative Agent or the Lead
Arranger, neither the Administrative Agent nor the Lead Arranger shall have any
duty or responsibility to provide any Bank or other Loan Party with any credit
or other information concerning the business, prospect, operation, property,
financial and other condition or creditworthiness of any Borrower which may come
into the possession of the Administrative Agent, the Lead Arranger or any
Affiliate thereof.

         10.7     BANK CONSENT.

                  For purposes of determining compliance with the conditions
specified in Section 3 of this Agreement each Loan Party that has executed this
Agreement shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter either sent or made available by
the Administrative Agent to such Loan Party for consent, approval, acceptance or
satisfaction, or required hereunder to be consented to or approved by or
acceptable or satisfactory to the Loan Party, unless an officer of the
Administrative Agent responsible for the transactions contemplated by the Loan
Documents shall have received notice from the Loan Party prior to the
Restatement Date specifying its objection thereto and either such objection
shall not have been withdrawn by notice to the Administrative Agent to that
effect on or prior to the Restatement Date or, if any Borrowing on the
Restatement Date has been requested, such Bank shall not have made available to
the Administrative Agent on or prior to the Restatement Date such Bank's ratable
portion of any Borrowing.

         10.8     NO IMPLIED REPRESENTATIONS.

                  Neither the Administrative Agent nor the Lead Arranger shall
be liable for any representation, warranty, agreement or obligation of any kind
of any other party to this Agreement or anyone else, whether made or implied by
any Borrower in this Agreement or any Loan Document or by a Bank in any notice
or other communication or by anyone else or otherwise.

         10.9     ADMINISTRATIVE AGENT'S DILIGENCE.

                  Neither the Administrative Agent nor the Lead Arranger shall
be required and shall not be responsible to any Loan Party: (a) to keep itself
informed as to anyone's compliance with any provision of this Agreement or any
Loan Document, (b) to make any inquiry into the properties, financial condition
or operation of any Borrower or any other matter relating to this Agreement or
any Loan Document, (c) to report to any Loan Party any information (other than
which this Agreement or any Loan Document expressly requires to be so reported)
that the

                                       66
<PAGE>

Administrative Agent or any of its Affiliates may have or acquire in respect of
the properties, business or financial condition of the Borrower or any other
matter relating to this Agreement or any Loan Document or (d) to inquire into
the validity, effectiveness or genuineness of this Agreement or any Loan
Document.

         10.10    NOTICE OF DEFAULT.

                  The Administrative Agent shall not be deemed to have knowledge
of any Potential Default or Event of Default unless and until it shall have
received a written notice from a Borrower or any Bank describing it and citing
the relevant provision of this Agreement or any Loan Document. The
Administrative Agent shall give each Loan Party prompt notice of any such
written notice other than the Bank that shall have given the written notice of
the Event of Default.

         10.11    ADMINISTRATIVE AGENT'S LIABILITY.

Neither the Administrative Agent (acting in its capacity as Administrative
Agent) nor the Lead Arranger acting in its capacity as Lead Arranger, nor any
directors, officers, employees, attorneys, and other agents acting for the
Administrative Agent or the Lead Arranger, as the case may be, in such
capacities respectively, shall be liable for any action or omission on their
respective parts except for gross negligence or willful misconduct. Without
limitation of the generality of the foregoing, the Administrative Agent and the
Lead Arranger: (a) may treat the payee of any Revolving Credit Note or Term Note
as the holder thereof until the Administrative Agent receives a fully executed
copy of any assignment with respect thereto, signed by such payee and in form
satisfactory to the Administrative Agent; (b) may consult with legal counsel,
independent public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts which have
been selected by the Administrative Agent with reasonable care; (c) makes no
warranty or representation to any Bank and shall not be responsible to any Bank
or the Issuing Banks for any statements, warranties or representations made in
or in connection with this Agreement or any other Loan Document, including,
without limitation, the truth of the statements made in any certificate
delivered by the Borrowers under Section 2, Section 3, Section 4, Section 5 or
Section 6 of this Agreement or in any Credit Request, Rate
Continuation/Conversion Request, Letter of Credit Facility Application or any
other similar notice or delivery, the Administrative Agent (and Lead Arranger to
the extent relevant thereto) being entitled for the purposes of determining
fulfillment of the conditions set forth therein to rely conclusively upon such
certificates; (d) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of this
Agreement, the Revolving Credit Notes, the Term Notes or any other Loan Document
or to inspect the property (including the books and records) of the Borrowers;
(e) shall not be responsible to any Bank or any Issuing Banks for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of this Agreement, or collateral covered by any agreement or any other Loan
Document and (f) shall incur no liability under or in respect of this Agreement,
the Revolving Credit Notes, the Term Notes or any other Loan Document by acting
upon any notice, consent, certificate or other instrument or writing (which may
be by telegram, telecopy, cable or telex) believed by it in good faith to be
genuine and correct and signed or sent by the proper party or parties.

                  Neither the Administrative Agent, nor the Lead Arranger, nor
any of directors, officers, employees or Administrative Agents thereof shall
have any responsibility to the Borrowers or any Subsidiary Guarantor on account
of the failure of or delay in performance or breach by any Lender or any Issuing
Bank of any of its obligations hereunder or to any Bank on account of the
failure of or delay in performance or breach by any other Bank or any other
Issuing Bank or any Borrower of any of their respective obligations hereunder or
under any Loan

                                       67
<PAGE>

Document or in connection herewith or therewith. The Banks and the Issuing Banks
each hereby acknowledge that the Administrative Agent and the Lead Arranger
shall be under no duty to take any discretionary action permitted to be taken by
it pursuant to the provisions of this Agreement, the Revolving Credit Notes, the
Term Notes or any other Loan Document unless it shall be requested in writing to
do so by the Required Banks.

         10.12    ADMINISTRATIVE AGENT'S AND LEAD ARRANGER'S INDEMNITY.

                  The Lenders shall indemnify the Administrative Agent, in its
capacity as Administrative Agent, and the Lead Arranger in its capacity as Lead
Arranger (to the extent the Administrative Agent and the Lead Arranger, as the
case may be, is not reimbursed by the Borrower), from and against: (a) any loss
or liability (other than any caused by the Administrative Agent's or the Lead
Arranger's gross negligence or willful misconduct) incurred by the
Administrative Agent as such and the Lead Arranger as such in respect of this
Agreement, the Revolving Credit Notes, the Term Notes or any Loan Document and
(b) any out-of-pocket expenses incurred in defending itself or otherwise related
to this Agreement, the Revolving Credit Notes, the Term Notes or any Loan
Document (other than any caused by the Administrative Agent's or the Lead
Arranger's, as the case may be, gross negligence or willful misconduct)
including, without limitation, reasonable fees and disbursements of legal
counsel of its own selection (including, without limitation, the reasonable
interdepartmental charges of its salaried attorneys) in the defense of any claim
against it or in the prosecution of its rights and remedies as the
Administrative Agent or the Lead Arranger, as the case may be, (other than the
loss, liability or costs incurred by the Administrative Agent or the Lead
Arranger in the defense of any claim against it by the Lenders or the Designated
Letter of Credit Issuer arising in connection with its actions in its capacity
as Administrative Agent); provided, however, that each Lender shall be liable
for only its Ratable Portion of the whole loss or liability.

                  The parties hereto acknowledge and agree that no Bank that is
a Syndication Agent or Documentation Agent or Co-Documentation Agent shall have
by reason of its designation as a Syndication Agent, a Documentation Agent or a
Co-Documentation Agent, any power, duty, responsibility or liability whatsoever
under this Agreement or under any other Loan Document.

         10.13    RESIGNATION OR REMOVAL OF ADMINISTRATIVE AGENT.

                  The Administrative Agent may resign as Administrative Agent
effective ten (10) Business Days after giving notice thereof to the Loan Parties
for any reason. The Administrative Agent may be removed at the unanimous
election of all of the Banks (other than the Bank that is also the
Administrative Agent) for any reason. If the Administrative Agent shall resign
or be removed as Administrative Agent under this Agreement, the Required Banks
shall appoint from among the Banks (other than the Bank that has resigned or was
removed) a successor agent for the Banks, which successor agent shall be
reasonably acceptable to the Borrowers. In the case of resignation by the
Administrative Agent, if no successor agent shall have been appointed by the
time such resignation becomes effective, then the retiring Administrative Agent
may, on behalf of the Banks, appoint a successor agent from among the remaining
Banks which successor agent shall be reasonably acceptable to the Borrowers.
Upon appointment (whether effected by the Required Banks or the retiring
Administrative Agent on behalf of the Banks), the successor agent shall succeed
to the rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall mean such successor agent, effective upon its
appointment, and the former Administrative Agent's rights, powers and duties as
Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Administrative Agent or any of the parties to
this Agreement or any holder of the Revolving Credit Notes or Term Notes. After
any retiring Administrative Agent's resignation or removal hereunder as

                                       68
<PAGE>

Administrative Agent, the provisions of Section 10.12 shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was Administrative
Agent under this Agreement.

SECTION 11        TRANSFERS AND ASSIGNMENTS.

         11.1     TRANSFER OF COMMITMENTS.

                  Each Bank shall have the right at any time or times to
transfer to another financial institution, without recourse, all or any part of:
such Bank's Revolving Credit Commitment (together with such Bank's Ratable
Portion of the commitments of the Issuing Bank to issue Letters of Credit), any
related Advance made by such Bank and outstanding Term Advances, any related
participation in Letters of Credit, and Revolving Credit Note and Term Note
executed in favor of such Bank, and any participations, if any, purchased by the
Bank pursuant to Sections 2.17 or 2.18 of this Agreement; provided, however, in
each such case, that the transferor and the transferee shall have complied with
the following requirements:

                  (a)      PRIOR CONSENT.

                           No transfer (other than a transfer by any Bank to any
         Affiliate of such Bank) may be consummated pursuant to this Section 11
         unless each of the following conditions is fulfilled: (i) the prior
         written consent of the Administrative Agent and International, which
         shall not be unreasonably withheld, must be obtained, (ii) such
         transfer must be in an amount of at least Five Million Dollars
         ($5,000,000) of the transferring party's Revolving Credit Commitment
         and Term Advances and (iii) after giving effect to such transfer, the
         transferring party would have a resulting Revolving Credit Commitment
         and Term Advances of at least Ten Million Dollars ($10,000,000);
         provided, however, that, if at the time of the proposed transfer a
         Borrower is the subject of a proceeding referenced in Section 7.13 of
         this Agreement or an Event of Default has otherwise occurred which has
         not been waived in accordance with Section 13.1, no Borrower's consent
         shall be required and any Loan Party may consummate a transfer
         contemplated by this Section 11.1. Notwithstanding anything to the
         contrary, any Loan Party may at any time assign all or any portion of
         its rights under this Agreement and its Revolving Credit Note and Term
         Note to a Federal Reserve Bank, and no such assignment shall release
         such assigning Loan Party from its obligations hereunder.

                  (b)      WITHHOLDING TAX EXEMPTION.

                           If an assignment made pursuant to this Section 11.1
         is to be made to an assignee that is organized under the laws of any
         jurisdiction other than the United States or any state thereof, the
         assignor Bank shall cause such assignee, at least five (5) Business
         Days prior to the effective date of such assignment, (i) to represent
         to the assignor Bank (for the benefit of the assignor Bank, the
         Administrative Agent and the Borrowers) that under applicable law and
         treaties, no taxes will be required to be withheld by the
         Administrative Agent, the Borrowers or the assignor with respect to any
         payment to be made to such assignee in respect of the Advances
         hereunder, and (ii) to furnish, if applicable, the forms prescribed by
         the Internal Revenue Service of the United States certifying that the
         Assignee is entitled to receive payments under the Loan Documents
         without deduction or withholding of any United States federal income
         taxes.

                  (c)      AGREEMENT; TRANSFER FEE.

                           The transferor: (i) shall remit to the Administrative
         Agent an administrative fee of Three Thousand Five Hundred Dollars
         ($3,500) and (ii) shall cause the transferee to execute and deliver to
         the Borrowers, the Administrative Agent and each

                                       69
<PAGE>

         Loan Party (A) an Assignment Agreement, substantially in the form of
         Exhibit K attached hereto, and otherwise in form and substance
         satisfactory to the Administrative Agent and its counsel (an
         "Assignment Agreement"), together with the consents and releases
         referenced therein and (B) such additional amendments, assurances and
         other writings as the Administrative Agent may reasonably require to
         effect such transfer.

                  (d)      NOTES.

                           The Borrowers shall execute and deliver: (i) to the
         Administrative Agent, the transferor and the transferee, any consent or
         release (of all or a portion of the obligations of the transferor) to
         be delivered in connection with the Assignment Agreement, (ii) if a
         Bank's entire interest in its Revolving Credit Commitment, its
         obligation to participate in Letters of Credit and in all of its
         Advances have been transferred, to the transferee appropriate Revolving
         Credit Notes and Term Notes against return of the Revolving Credit
         Notes and Term Notes (marked "replaced") held by the transferor and
         (iii) if only a portion of a Bank's interest in its Revolving Credit
         Commitment and its obligation to participate in Letters of Credit and
         Advances has been transferred, a new Revolving Credit Note and new Term
         Note to each of the transferor and the transferee against return of the
         original such Revolving Credit Notes and Term Notes of the transferor
         (marked "replaced") held by the transferor.

                  (e)      PARTIES.

                           Upon satisfaction of the requirements of this Section
         11.1, including the payment of the fee and the delivery of the
         documents set forth in Section 11.1(c) above, (i) the transferee shall
         become and thereafter be deemed to be a "Bank" for the purposes of this
         Agreement and (ii) the transferor (A) shall continue to be a "Bank" for
         the purposes of this Agreement only if and to the extent that the
         transfer shall not have been a transfer of its entire interest in its
         Revolving Credit Commitment and its entire obligation to participate in
         Letters of Credit and Advances, (B) shall cease to be and thereafter
         shall no longer be deemed to be a "Bank" in the case of any transfer of
         its entire interest in its Revolving Credit Commitment and shall cease
         to be bound by its obligation to participate in Letters of Credit and
         Advances and (C) the signature pages hereto and Annex I hereto shall be
         automatically amended, without further action, to reflect the result of
         any such transfer.

         11.2     SALE OF PARTICIPATIONS.

                  Each Bank shall have the right at any time or times to sell
one or more participations or subparticipations to a financial institution in
all or any part of: such Bank's Revolving Credit Commitment; any obligation to
participate in Letters of Credit; any Advance made by such Bank; any Note
executed in favor of such Bank, and any participations, if any, purchased by
such Bank pursuant to Section 2.17 or 2.18 of this Agreement or this Section 11;
provided, however, in each such case, that the transferor and the transferee
shall have complied with the following requirements:

                  (a)      PRIOR CONSENT.

                           No sale of a participation (other than a transfer by
         any Bank to a to a Subsidiary of National City Corporation, ABN AMRO
         Holding N.V., KeyCorp or an Affiliate of General Electric Capital
         Corporation) may be consummated pursuant to this Section 11 unless each
         of the following conditions is fulfilled: (i) the prior written consent
         of the Administrative Agent and International, which shall not be
         unreasonably withheld, must be obtained, (ii) such transfer is in an
         amount of at least Five Million

                                       70
<PAGE>

         Dollars ($5,000,000) of the transferring party's Revolving Credit
         Commitment and Term Advances and (iii) after giving effect to such
         transfer, the transferring party would have a resulting Revolving
         Credit Commitment and Advances of at least Ten Million Dollars
         ($10,000,000); provided, however, that, if at the time of the proposed
         participation a Borrower is the subject of a proceeding referenced in
         Section 7.13 of this Agreement or an Event of Default has otherwise
         occurred which has not been waived in accordance with Section 13.1, no
         Borrower's consent shall be required and any Loan Party may consummate
         a participation contemplated by this Section 11.2.

                  (b)      BENEFITS OF PARTICIPANT.

                           The provisions of Section 12 of this Agreement shall
         inure to the benefit of each purchaser of a participation or
         subparticipation (provided that each such participant shall look solely
         to the seller of its participation for those benefits and the
         Borrowers' liabilities, if any, under any of those Sections shall not
         be increased as a result of the sale of any such participation) and the
         Administrative Agent shall continue to distribute payments pursuant to
         this Agreement as if no participation has been sold.

                  (c)      RIGHTS RESERVED.

                           In the event any Bank shall sell any participation or
         subparticipation, such Bank shall, as between itself and the purchaser,
         retain all of its rights (including, without limitation, rights to
         enforce against the Borrowers this Agreement and the Loan Documents)
         and duties pursuant to this Agreement and the Loan Documents,
         including, without limitation, such Bank's right to approve any waiver,
         consent or amendment pursuant to Section 13.1 of this Agreement, except
         if and to the extent that any such waiver, consent or amendment would
         (A) reduce any fee or commission allocated to the participation or
         subparticipation, as the case may be, (B) reduce the amount of any
         principal payment on any Advance allocated to the participation or
         subparticipation, as the case may be, or reduce the principal amount of
         any Advance so allocated or the rate of interest payable thereon, or
         (C) extend the time for payment of any amount allocated to the
         participation or subparticipation, as the case may be.

                  (d)      NO DELEGATION.

                           No participation or subparticipation shall operate as
         a delegation of any duty of the seller thereof. Under no circumstance
         shall any participation or subparticipation be deemed a novation in
         respect of all or any part of the seller's obligations pursuant to this
         Agreement.

         11.3     CONFIDENTIALITY.

                  Each Loan Party hereby: (a) acknowledges that each Borrower,
its Subsidiaries and International has trade secrets and financial,
environmental and other data and information the confidentiality of which is
important to its business and (b) agrees to keep confidential any such trade
secret, data or information designated in writing by a Borrower, or its
Subsidiary or International as confidential, except that this Section 11 shall
not be binding on the Loan Parties after the expiration of two years after the
termination of this Agreement and shall not preclude any Bank or other Loan
Party from furnishing any such confidential information: (i) if permitted under
applicable law and such legal proceedings and to the extent which may be
required by subpoena or similar order of any court of competent jurisdiction,
(ii) to the extent such information is required to be disclosed to any
regulatory or administrative governmental agency or commission having any
regulatory authority over that Loan Party or its securities, (iii) to any other
party to this Agreement, (iv) to any Affiliate of any Bank so long as such
Affiliate agrees

                                       71
<PAGE>

to be bound by the provisions of this Section 11.3, (v) to any actual or
prospective transferee, participant or subparticipant of all or part of that
Bank's rights arising out of or in connection with the Loan Documents and this
Agreement so long as such prospective transferee, participant or subparticipant
to whom disclosure is made agrees to be bound by the provisions of this Section
11.3, as the case may be, (vi) to anyone if it shall have been already publicly
disclosed (other than by that Loan Party in contravention of this Section 11.3,
(vii) to the extent reasonably required in connection with the exercise of any
right or remedy under this Agreement or any Loan Document, (viii) to that Loan
Party's legal counsel, auditors, professional advisors and consultants, and
accountants and (ix) in connection with any legal proceedings instituted by or
against the Administrative Agent or any Loan Party in its respective capacities
as the Administrative Agent and a Bank or Loan Party under this Agreement.

SECTION 12        INDEMNITIES.

         12.1     INCREASED COSTS.

                  If, after the Restatement Date of this Agreement, (a) the
introduction of any Law, rule or regulation or any or any change therein (other
than any change by way of imposition or increase of reserve requirements in
respect of LIBOR Advances otherwise included in the Eurocurrency Reserve
Percentage) in or in the interpretation of any Law or regulation or (b) the
compliance with any guideline or request from any central bank or other
governmental authority (whether or not having the force of Law), shall increase
the cost to any Loan Party (other than any increase in the cost of the overhead
of such Loan Party) of agreeing to make or making, funding, or maintaining
Advances to the Borrowers or the cost of any Issuing Bank of issuing,
maintaining or participating in any Letter of Credit, then the Borrowers shall
from time to time, upon demand by such Loan Party (with a copy of such demand to
the Administrative Agent), pay to the Administrative Agent for the account of
such Loan Party additional amounts sufficient to indemnify such Loan Party for
such increased cost.

         12.2     RISK-BASED CAPITAL.

                  If any Loan Party determines that after the Restatement Date:
(a) compliance with any Law or regulation or any interpretation or
administration thereof by any governmental authority charged with the
interpretation or administration thereof or (b) compliance with any directive,
guideline or request from any central bank or other governmental authority
(whether or not having the force of Law) affects or would affect the amount of
capital required or expected to be maintained by such Loan Party or any
corporation controlling such Bank and that the amount of such capital required
to be so maintained is increased by or based upon the existence of such Loan
Party's Revolving Credit Commitment to lend hereunder or to issue or participate
in Letters of Credit hereunder and other commitments of this type, then, upon
demand by such Loan Party (with a copy of such demand to the Administrative
Agent), the Borrowers shall immediately pay to the Administrative Agent for the
account of such Loan Party, from time to time as specified by such Loan Party,
additional amounts sufficient to indemnify such Loan Party or such corporation,
to the extent that such Loan Party reasonably determines such increase in
capital to be allocable to the existence of such Loan Party's Revolving Credit
Commitment to lend or to issue or participate in Letters of Credit hereunder.

         12.3     TAXES.

                  (a)      TAXES; WITHHOLDING.

                           Any and all payments by the Borrowers hereunder,
         under the Revolving Credit Notes, Term Notes or the other Loan
         Documents, and any and all payments to any Loan Party made by any
         Affiliate of any Loan Party in connection with any extension of

                                       72
<PAGE>

         credit or other financial accommodation made by any such Affiliate in
         favor any Subsidiary of any Borrower or in connection with any Letter
         of Credit made in favor of any such Affiliate (such extensions of
         credit and other financial accommodations and such Letters of Credit
         being collectively referred to herein as "Affiliate Financial
         Accommodations"), shall be made free and clear of and without deduction
         for any and all present or future taxes, levies, imposts, deductions,
         charges or withholdings, and all liabilities with respect thereto,
         excluding in the case of each of the Administrative Agent and, any Loan
         Party, and any such Affiliate, taxes imposed on net income and
         franchise taxes imposed on it by the jurisdiction under the Laws of
         which the Administrative Agent or such Loan Party or such Affiliate is
         organized or any political subdivision thereof (all such non-excluded
         taxes, levies, imposts, deductions, charges, withholdings and
         liabilities being hereinafter referred to as "Taxes"). If any Borrower
         or any Affiliate of a Loan Party shall be required by Law to deduct any
         Taxes from or in respect of any sum payable hereunder or under any
         Revolving Credit Note or Term Note to any Bank or the Administrative
         Agent or if any Affiliate of a Loan Party is required by Law to deduct
         any Taxes from or in respect of any sum payable to any Loan Party in
         connection with any Affiliate Financial Accommodation: (i) the sum
         payable shall be increased as may be necessary so that after making all
         required deductions (including deductions applicable to additional sums
         payable under this Section 12.3) such Loan Party receives an amount
         equal to the sum it would have received had no such deductions been
         made, (ii) other than in connection with Affiliate Financial
         Accommodations, the Borrowers shall make such deductions and (iii)
         other than in connection with Affiliate Financial Accommodations, the
         Borrowers shall pay the full amount deducted to the relevant taxation
         authority or other authority in accordance with applicable Law. All
         Taxes payable in connection with clauses (i), (ii) or (iii) above shall
         be paid or reimbursed to the party making payment by the Borrowers
         prior to the date on which penalties attached thereto or interest
         accrues thereon; provided, however, that, if any such penalties or
         interest become due, the Borrowers shall make prompt payment thereof to
         the appropriate governmental authority. The Borrowers shall indemnify
         the Administrative Agent, each Bank and each Issuing Bank for the full
         amount of such Taxes (including any Taxes on amounts payable under this
         Section 12.3(a) paid by such Bank, such Issuing Bank and the
         Administrative Agent and any liability (including penalties, interest
         and expenses) arising therefrom or with respect thereto, whether or not
         such Taxes were correctly or legally asserted. Any indemnification
         payment shall be made within thirty (30) days from the date such Bank,
         such Issuing Bank or the Administrative Agent makes written demand
         therefor.

                  (b)      STAMP TAXES.

                           The Borrowers agree to pay, and will indemnify each
         Bank each Loan Party and the Administrative Agent for, any present or
         future stamp or documentary taxes or any other excise or property
         taxes, charges or similar levies which arise from any payment made
         hereunder or under the Revolving Credit Notes or Term Notes or from the
         execution, delivery or registration of, or otherwise with respect to,
         this Agreement, the Revolving Credit Notes or Term Notes (hereinafter
         referred to as "Other Taxes").

                  (C)      INDEMNIFICATION FOR OTHER TAXES.

                           The Borrowers will indemnify each Bank, each other
         Loan Party, Affiliate of a Loan Party, and the Administrative Agent for
         the full amount of Taxes or Other Taxes (including, without limitation,
         any Taxes or Other Taxes imposed by any jurisdiction on amounts payable
         under this Section 12.3) paid by such Bank, other Loan Party or the
         Administrative Agent or by any Affiliate of a Loan Party (as the case
         may be) and any liability (including penalties, interest and expenses)
         arising therefrom or with

                                       73
<PAGE>

         respect thereto, whether or not such Taxes or Other Taxes were
         correctly or legally asserted. Any indemnification payment shall be
         made within 30 days from the date such Bank, other Loan Party, any
         Affiliate of a Loan Party, or the Administrative Agent (as the case may
         be) makes written demand therefor.

                  (d)      REQUEST FOR REFUND.

                           At the reasonable request of the Borrowers, a Bank,
         other Loan Party, any Affiliate of a Loan Party, or the Administrative
         Agent shall apply at the Borrowers' expense for a refund in respect of
         Taxes or Other Taxes previously paid or indemnified against by the
         Borrowers pursuant to this Section 12.3 if in the good faith opinion of
         such Bank, other Loan Party, Affiliate, or the Administrative Agent
         there is a reasonable basis for such refund. Notwithstanding the
         foregoing, none of the Banks, other Loan Parties, such Affiliates, or
         the Administrative Agent shall be obligated to pursue such refund if,
         in the exercise of its good faith judgment, such action would be
         disadvantageous to it. If any Bank or Loan Party or an Affiliate
         thereof subsequently receives from a taxing authority a refund of any
         Tax previously paid or indemnified against by the Borrowers and for
         which the Borrowers have indemnified the Bank or other Loan Party or an
         Affiliate thereof pursuant to this Section 12.3, such Bank or Loan
         Party shall within thirty (30) days after receipt of such refund, and
         to the extent permitted by applicable Law, pay to the Borrowers the net
         amount of any such recovery after deducting taxes and expenses
         attributable thereto.

                  (e)      EXEMPTION CERTIFICATE.

                           Not later than: (a) the Closing Date of the Original
         Credit Agreement, (b) in the case of any bank or financial institution
         that becomes a Bank or other Loan Party after the Closing Date of the
         Original Credit Agreement pursuant to Section 12.3 above of this
         Agreement, the date of the instrument of assignment pursuant to which
         such bank or financial institution became a Bank or other Loan Party,
         (c) annually on each Anniversary Date thereafter or (d) such other
         times as the Administrative Agent or the Borrowers may reasonably
         request: (i) each Bank or other Loan Party organized under the laws of
         a jurisdiction outside the United States shall provide the
         Administrative Agent and the Borrowers with duly completed copies of
         U.S. Internal Revenue Service Form W-8ECI or W-8BEN or U.S. Internal
         Revenue Service Form W-8 or W-9, as applicable or any successor form
         prescribed by the Internal Revenue Service of the United States
         certifying that such Bank or other Loan Party is exempt from United
         States withholding taxes with respect to all payments to be made to
         such Bank or other Loan Party hereunder or other document satisfactory
         to the Borrowers and the Administrative Agent indicating that all
         payments to be made to such Bank or other Loan Party hereunder are not
         subject to such taxes and (ii) each other Bank or other Loan Party
         shall provide the Administrative Agent and the Borrowers with a written
         statement which certifies that such Bank or other Loan Party is not a
         non-resident alien or foreign corporation and which otherwise satisfies
         Treasury Regulation Section 1.1441-5(b) or any successor regulation
         under the Internal Revenue Code (each such certificate or statement, an
         "Exemption Certificate"). Unless the Administrative Agent and the
         Borrowers have received an Exemption Certificate from such Bank or
         other Loan Party, the Borrowers, or the Administrative Agent if the
         Borrowers have not withheld, may withhold taxes from such payments at
         the applicable statutory rate (subject, in the case of the Borrowers to
         the requirements of Section 12.3 above); provided, however, that if the
         Borrowers have withheld the Borrowers shall so notify the
         Administrative Agent. If the Borrowers are required to pay additional
         amounts to any Bank or other Loan Party pursuant to this Section 12.3,
         such Bank or other Loan Party shall use commercially reasonable efforts
         to designate a different Lending Office if such designation will
         thereafter avoid the need for

                                       74
<PAGE>

         any additional payments under this Section 12.3 and will not, in the
         sole judgment of such Bank or other Loan Party, be otherwise
         disadvantageous to such Bank or other Loan Party. A Bank or other Loan
         Party which ceases to be exempt from United States withholding taxes
         shall notify the Administrative Agent and the Borrowers promptly
         thereof.

                  (f)      FURNISHING OF CERTIFICATE.

                           Within 30 days after the date of any payment of
         Taxes, the Borrowers will furnish to the Administrative Agent, at its
         address referred to in Section 13.13 of this Agreement, the original or
         a certified copy of a receipt evidencing payment thereof. If Taxes ever
         become payable in respect of any payment hereunder or under the
         Revolving Credit Notes or Term Notes made during a Fiscal Quarter,
         thereafter the Borrowers will furnish to the Administrative Agent,
         within thirty (30) days after the end of such Fiscal Quarter, at such
         address, a certificate from the Borrowers stating that any payments
         made during such Fiscal Quarter are exempt from or not subject to
         Taxes.

                  (g)      SURVIVAL OF PROVISION.

                           Without prejudice to the survival of any other
         agreement of the Borrowers and the Banks hereunder, the agreements and
         liabilities of the Borrowers contained in this Section 12.3 shall
         survive the payment in full of the Obligations and the termination of
         this Agreement.

         12.4     LOSSES.

                  If any payment of principal of, or Rate Conversion or Rate
Continuation of, any LIBOR Advance is not paid when due or is made on a day
other than on the last day of an Interest Period relating to such Advance, as a
result of a payment or Rate Conversion or Rate Continuation pursuant to the
provisions of Section 2.10 of this Agreement or acceleration of the maturity of
the Revolving Credit Notes or Term Notes pursuant to Section 8 of this Agreement
or for any other reason, the Borrowers shall, upon demand by any Bank (with a
copy of such demand to the Administrative Agent), pay to the Administrative
Agent for the account of such Bank any amounts required to compensate such Bank
for any additional losses, costs or expenses which it may reasonably incur as a
result of such payment, prepayment or Rate Conversion or Rate Continuation,
including, without limitation, any loss, cost or expense (other than any
expenses directly attributable to loan origination efforts) incurred by reason
of the liquidation or reemployment of deposits or other funds acquired by such
Bank to fund or maintain such Advance.

         12.5     INDEMNIFICATION FOR REQUESTS.

                  Whenever any Borrower: (a) shall revoke any Credit Request,
any Rate Conversion/Continuation Request involving any LIBOR Advance, (b) shall
for any other reason fail to borrow pursuant to any such Request or otherwise
comply therewith, (c) shall fail to fulfill, on or before the date specified in
any such request, the applicable conditions set forth in Section 3 of this
Agreement to be fulfilled by such date or (d) shall fail to honor any prepayment
notice, then, in each case on any Bank's demand, the Borrowers shall indemnify
each Bank and the Administrative Agent against any loss, cost or expense
incurred by such Bank or the Administrative Agent as a result of any such
failure by the Borrowers, including, without limitation, any loss, cost or
expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by such Bank or the Administrative Agent to fund the LIBOR
Advance to be made by such Bank or the Administrative Agent in connection with
such request

                                       75
<PAGE>

when such LIBOR Advance, as a result of such failure by the Borrowers, is not
made on such date.

         12.6     GENERAL INDEMNITY.

                  The Borrowers shall jointly and severally indemnify and hold
harmless the Administrative Agent, the Lead Arranger and each Bank and each
other Loan Party, and the respective directors, officers, employees and
Affiliates thereof, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses and
disbursements of any kind or nature whatsoever including, without limitation,
reasonable fees and disbursements of counsel and settlements costs, which may be
imposed on, incurred by, or asserted against the Administrative Agent, the Lead
Arranger, any Bank, any Loan Party or the respective directors, officers,
employees and Affiliates thereof in connection with any investigative,
administrative or judicial proceeding (whether the Administrative Agent, the
Lead Arranger or such Bank or Loan Party is or is not designated as a party
thereto) relating to or arising out of this Agreement or any other Loan
Document, the transactions contemplated thereby, or any actual or proposed use
of proceeds hereunder or thereunder, except that neither the Administrative
Agent, nor the Lead Arranger, nor any Bank nor any other Loan Party nor any such
directors, officers, employees and Affiliates thereof shall have the right to be
indemnified hereunder for its own gross negligence or willful misconduct as
determined by a court of competent jurisdiction.

         12.7     ENVIRONMENTAL INDEMNITY.

                  Each Borrower shall, at its sole cost and expense, indemnify,
defend and save harmless the Administrative Agent and each of the Loan Parties
(and each of their respective officers, directors, employees, agents,
representatives and contractors) from and against any and all damages, losses,
liabilities, obligations, penalties, claims, litigations, demands, defenses,
judgments, suits, actions, proceedings, costs, disbursements and\or expenses
(including, without limitation, reasonable attorneys' and experts' fees,
expenses and disbursements) of any kind or nature whatsoever which may at any
time be imposed upon, incurred by or asserted against any of such indemnified
Persons relating to, resulting from or arising out of: (i) Environmental Claims
relating to the owned real property at the Collateral Locations, (ii) a material
misrepresentation or inaccuracy in any representation or warranty contained in
this Agreement relating to any environmental matters applicable to the Borrowers
or (iii) a breach or failure to perform any covenant made by such Borrower in
this Agreement with respect to environmental matters which continues uncured
after the expiration of any applicable grace period provided, however, that no
Borrower shall be obligated under this Section 12.7 to indemnify, defend and
save harmless the Administrative Agent or any Bank for Environmental Claims to
the extent caused by environmental conditions which have been finally determined
by a court of competent jurisdiction to have resulted directly from the gross
negligence or willful misconduct of the Administrative Agent or a Bank at or in
the owned real property located at the Collateral Locations that arise after the
Administrative Agent or a Bank has taken possession of such property. Each
Borrower will pay any sums owing to the Administrative Agent or such Loan Party
by such Borrower pursuant to this indemnification obligation five (5) days after
demand by the Administrative Agent or such Loan Party, together with interest on
such amount accruing from and after the expiration of such period at the Default
Rate of interest hereunder.

         12.8     CERTIFICATE FOR INDEMNIFICATION.

                  Each demand by Administrative Agent or a Bank or another Loan
Party for payment pursuant to this Section 12 shall be accompanied by a
certificate setting forth the reason for the payment, the amount to be paid, and
the computations and assumptions in determining the amount, which certificate
shall be presumed to be correct. In determining the amount of any

                                       76
<PAGE>

such payment thereunder, each Bank or other Loan Party may use reasonable
averaging and attribution methods. The failure to give any such notice shall not
release or diminish any of the Borrowers' obligations to pay additional amounts
pursuant to this Section 12 upon the subsequent receipt of such notice.

         12.9     DUTY TO MITIGATE; STANDARD TREATMENT.

                  Each Bank or other Loan Party seeking payment pursuant to this
Section 12 shall use reasonable efforts and take all reasonable actions to avoid
the cause of the payment and to minimize the amount thereof. Each Bank and each
other Loan Party agrees that it will not seek compensation or reimbursement
provided for in this Section 12 unless such Bank or other Loan Party as a matter
of policy intends generally to seek comparable compensation or reimbursement
from other borrowers similarly situated and with similarly documented financial
accommodations.

SECTION 13        GENERAL.

         This Agreement and the Loan Documents shall be governed by the
following provisions:

         13.1     AMENDMENTS AND WAIVERS.

                  No amendment or waiver of any provision of this Agreement, the
Revolving Credit Notes, Term Notes or any Loan Document, nor consent to any
departure by the Borrowers or any Borrower therefrom, nor waiver of any Event of
Default under this Agreement, the Revolving Credit Notes, Term Notes or any Loan
Document, shall in any event be effective unless the same shall be in writing
and signed by the Required Banks (or, if unanimous consent of all Banks is
required as hereinafter provided, all of the Banks), the Administrative Agent
and each of the Borrowers. Such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given. Unanimous waiver
or consent of all Banks shall be required only with respect to: (a) the
extension of maturity of any Revolving Credit Note or Term Note, or the payment
date of interest, principal and/or fees thereunder, or (b) any reduction in the
rate of interest on the Revolving Credit Notes or Term Notes, or in any amount
of principal or interest due on any Revolving Credit Note or Term Note, or in
the manner of pro rata application of any payments made by the Borrowers to the
Banks hereunder, or (c) any change in the definition of "Alternate Currency", or
(d) any change in the definition or calculation of "Required Banks", or (e)
pursuant to the terms of Section 1.6, any addition of a Borrower, or (f) any
change in the dollar amount or percentage of any Bank's Revolving Credit
Commitment, or (g) any change in amount or timing of any fees payable under this
Agreement, or (h) any change in the definition of "Collateral" under this
Agreement, or (i) any release of any material portion of the Collateral or any
Guaranty hereunder except in connection with a transaction expressly permitted
by Section 6.3(a) hereof (and the Administrative Agent agrees to release any
security interest or other Lien in connection with any such transaction), or (j)
the extension of the expiration date of any Letter of Credit beyond the
Revolving Credit Termination Date or (k) any change in any provision of this
Agreement which requires all of the Banks to take any action under such
provision or (l) any change in Section 10, 11.1, 11.2 or this Section 13.1
itself. Notice of amendments or consents ratified by the Banks hereunder shall
immediately be forwarded by the Borrowers to all Banks. Each Bank or other
holder of a Revolving Credit Note and Term Note and each other Loan Party shall
be bound by any amendment, waiver or consent obtained as authorized by this
Section, regardless of its failure to agree thereto.

         13.2     GENERAL ATTORNEY-IN-FACT.

                  Subject to the notice period in Section 5(b) of the Pledge
Agreements, in addition to the provisions of Sections 4.6 of this Agreement,
each Borrower hereby irrevocably

                                       77
<PAGE>

constitutes and appoints the Administrative Agent and any officer or agent
thereof, with full power of substitution, as its true and lawful
attorney-in-fact with full irrevocable power and authority in the place and
stead of such Borrower and in the name of such Borrower or in its own name, upon
and from time to time following the occurrence of an Event of Default which has
not been waived in writing in accordance with Section 13.1, in the
Administrative Agent's reasonable discretion, for the purpose of carrying out
the terms of this Agreement, to take any and all appropriate action and to
execute any and all documents and instruments which may be necessary or
desirable to effect the terms of this Agreement, including, without limiting the
generality of the foregoing, the power and right, on behalf of such Borrower, to
do the following, upon notice to such Borrower: (a) to pay or discharge taxes,
liens, security interests or other encumbrances levied or placed on or
threatened against the Collateral, to effect any repairs or any insurance,
called for by the terms of this Agreement and to pay all or any part of the
premiums therefor and the costs thereof, and otherwise to itself perform or
comply with, or otherwise cause performance or compliance with, any of the
covenants or other agreements of such Borrower contained in this Agreement which
such Borrower has failed to perform or with which such Borrower has not complied
and (b) to commence and prosecute any suits, actions or proceedings at law or in
equity in any court of competent jurisdiction to collect the Collateral or any
thereof and to enforce any other right in respect of any Collateral; (c) to
defend any suit, action or proceeding brought against such Borrower with respect
to any Collateral; (d) to settle, compromise or adjust any suit, action or
proceeding described above and, in connection therewith, to give such discharges
or releases as the Administrative Agent may deem appropriate; and (e) to sell,
transfer, pledge, make any agreement with respect to or otherwise deal with any
of the Collateral as fully and completely as though the Administrative Agent
were the absolute owner thereof for all purposes; and to do, at the
Administrative Agent's option and such Borrower's expense, at any time, or from
time to time, all acts and things which the Administrative Agent deems necessary
to protect, preserve or realize upon the Collateral and the Administrative
Agent's security interest therein, in order to effect the intent of this
Agreement, all as fully and effectively as such Borrower might do. This power of
attorney is a power coupled with an interest and shall be irrevocable.

                  (a)      ADMINISTRATIVE AGENT NOT LIABLE.

                           The powers conferred on the Administrative Agent
         hereunder are solely to protect its interests in the Collateral and
         shall not impose any duty upon it to exercise any such powers. The
         Administrative Agent shall be accountable only for amounts that it
         actually receives as a result of the exercise of such powers and
         neither it nor any of its officers, directors, employees or agents
         shall be responsible to any Borrower for any act or failure to act,
         except for its own gross negligence or willful misconduct.

                  (b)      AUTHORITY TO EXECUTE TRANSFERS.

                           Without limitation of any authorization granted to
         the Administrative Agent hereunder, each Borrower hereby authorizes the
         Administrative Agent, upon the occurrence of an Event of Default which
         has not been waived in writing in accordance with Section 13.1 of this
         Agreement, to execute, in connection with the exercise by the
         Administrative Agent of its remedies hereunder, any endorsements,
         assignments or other instruments of conveyance or transfer with respect
         to the Collateral.

         13.3     PERFORMANCE BY ADMINISTRATIVE AGENT OF THE BORROWER'S
                  OBLIGATIONS.

                  If any Borrower fails to perform or comply with any of its
agreements contained herein and the Administrative Agent shall itself perform or
comply, or otherwise cause performance or compliance, with such agreement, the
expenses of the Administrative Agent incurred in connection with such
performance or compliance, together with interest thereon at

                                       78
<PAGE>

the Default Rate in effect from time to time, shall be payable by the applicable
Borrower to the Administrative Agent within ten (10) Business Days following
demand and if not paid within said ten (10) Business Day period shall accrue
interest at the Default Rate and shall constitute Obligations secured hereby.
The Administrative Agent will notify such Borrower as soon as it is practicable
of any action taken by it of the nature referred to herein.

         13.4     JUDGMENTS; CONVERSION OF CURRENCIES.

                  (a)      CONVERSION.

                           If, for the purpose of obtaining judgment in any
         court, it is necessary to convert a sum owing hereunder in one currency
         into another currency, each party hereto agrees, to the fullest extent
         that it may effectively do so, that the rate of exchange used shall be
         that at which in accordance with normal banking procedures in the
         relevant jurisdiction the first currency could be purchased with such
         other currency on the Business Day immediately preceding the day on
         which final judgment is given.

                  (b)      DISCHARGE.

                           The obligations of each Borrower in respect of any
         sum due to any party hereto or any holder of the obligations owing
         hereunder (the "Applicable Creditor") shall, notwithstanding any
         judgment in a currency (the "Judgment Currency") other than the
         currency in which such sum is stated to be due hereunder (the
         "Agreement Currency"), be discharged only to the extent that, on the
         Business Day following receipt by the Applicable Creditor of any sum
         adjudged to be so due in the Judgment Currency, the Applicable Creditor
         may in accordance with the normal banking procedures in the relevant
         jurisdiction purchase the Agreement Currency with the Judgment
         Currency; if the amount of the Agreement Currency so purchased is less
         than the sum originally due the Applicable Creditor in the Agreement
         Currency, such Borrower agrees, as a separate obligation and
         notwithstanding any such judgment, to indemnify the Applicable Creditor
         against such loss. The obligations of the Borrowers contained in this
         Section 13.4 shall survive the termination of this Agreement and the
         payment of all other amounts owing hereunder.

         13.5     CONTINUITY CLAUSE - EURO.

                  Each Borrower affirms and agrees that neither the fixation of
the conversion rate of any currency in which payment is required hereunder or
under any Obligation (a "Required Currency") against the Euro as a single
currency, in accordance with the Treaty Establishing the European Economic
Community as amended by the Treaty on the European Union (The Maastricht
Treaty), nor the conversion of any Obligation or the obligations under this
Agreement from a Required Currency into Euro will (i) be a reason for the early
termination or the revision or reformation, in whole or in part, of this
Agreement or of any Obligation, or for the prepayment of any amount due under
this Agreement or under any Obligation, or (ii) create any liability of any Bank
toward any Borrower for any direct, consequential, or other loss arising from
any of these events. As of the date that any Required Currency is no longer the
lawful currency of its country, all payment obligations with respect to such
Required Currency under this Agreement shall be satisfied in Euro.

         13.6     CUMULATIVE PROVISIONS; INTEGRATION.

                  Each right, power or privilege specified or referred to in
this Agreement is in addition to and not in limitation of any other rights,
powers and privileges that the Administrative Agent and the Banks and the other
Loan Parties may otherwise have or acquire

                                       79
<PAGE>

by operation of Law, by other contract or otherwise. All covenants, conditions,
provisions, warranties, guaranties, indemnities, and other undertakings of the
Borrowers contained in this Agreement, each of the Loan Documents, or in any
document referred to in this Agreement or the Loan Document or contained in any
agreement supplementary hereto or thereto, or any schedule or report given to
the Administrative Agent or any Bank or other Loan Party or contained in any
other agreement between the Administrative Agent, the Banks, the other Loan
Parties and the Borrowers, whether concurrently or hereafter entered into or
delivered, shall be deemed cumulative to, and not in derogation or substitution
of, any of the terms, covenants, conditions, or agreements of the Borrowers
contained in this Agreement.

         13.7     BINDING EFFECT.

                  This Agreement shall become effective when it shall have been
executed by the Borrowers, the Administrative Agent and the Banks and the other
Loan Parties and shall be binding upon and inure to the benefit of the
Borrowers, the Administrative Agent, the Banks, the other Loan Parties and their
respective successors and assigns, except that none of the Borrowers shall have
the right to assign its rights hereunder or any interest herein without the
prior written consent of the Administrative Agent and the Banks. The Banks may,
in their sole discretion, assign, sell, transfer or sell participations or
subparticipations subject to Section 11 of this Agreement.

         13.8     COSTS AND EXPENSES.

                  The Borrowers agree to pay on demand all reasonable costs and
expenses of: (a) the Administrative Agent (including, without limitation, the
reasonable fees and out-of-pocket expenses of counsel for the Administrative
Agent actually incurred on an hourly basis) in connection with the preparation,
execution, delivery, administration, modification, amendment and waiver of any
default of this Agreement or the other Loan Documents and (b) the Administrative
Agent and the Banks and the other Loan Parties (including, without limitation,
the reasonable fees and out-of-pocket expenses of counsel actually incurred on
an hourly basis for the Administrative Agent and the Banks and the other Loan
Parties) in connection with (x) the enforcement of, the exercise of remedies
under, or the preservation of rights and remedies under this Agreement or any of
the other Loan Documents (including any collection, bankruptcy or other
enforcement proceedings arising with respect to any Borrower, this Agreement, or
any Event of Default under this Agreement and (y) any other Related Expenses.

         13.9     SURVIVAL OF PROVISIONS.

                  All representations and warranties made in or pursuant to this
Agreement shall survive the execution and delivery of this Agreement and of the
Revolving Credit Notes and Term Notes. The provisions of Sections 12.1 through
12.7 and 13.8 of this Agreement shall survive the payment of the Obligations
owed by the Borrower hereunder and the termination of this Agreement (whether by
acceleration or otherwise).

         13.10    CAPTIONS.

                  The several captions to different Sections and the respective
subsections thereof are inserted for convenience only and shall be ignored in
interpreting the provisions of this Agreement.

         13.11    INTEREST RATE LIMITATION.

                  Notwithstanding anything herein to the contrary, if at any
time the applicable interest rate, together with all fees and charges that are
treated as interest under applicable law as

                                       80
<PAGE>

provided for herein or in any other document executed in connection herewith, or
otherwise contracted for, charged, taken, received or reserved by the
Administrative Agent, any Bank or any other Loan Party, shall exceed the maximum
lawful rate that may be contracted for, charged, taken, received or reserved by
the Administrative Agent, any Bank or any other Loan Party in accordance with
applicable law, the rate of interest and all such fees and charges payable,
contracted for, charged, taken, received or reserved in respect of the Advances
or other financial accommodations of the Banks or the other Loan Parties to the
Borrowers shall be limited to the maximum rate permitted by applicable Law.

         13.12    ILLEGALITY.

                  If any provision in this Agreement or any other Loan Document
shall for any reason be or become illegal, void or unenforceable, that
illegality, voidness or unenforceability shall not affect any other provision.

         13.13    NOTICES.

                  Other than telephonic notices expressly permitted hereunder,
all notices, requests, confirmations, demands and other communications provided
for hereunder shall be in writing and shall be given solely: (a) by hand
delivery or by overnight courier delivery service, with all charges paid, (b) by
facsimile transmission, if confirmed same day in writing by first class mail, or
(c) by registered or certified mail, postage prepaid and addressed to the
parties. For the purposes of this Agreement, such notices shall be deemed to be
given and received: (i) if by hand or by overnight courier service, upon actual
receipt, (ii) if by facsimile transmission, upon receipt of machine-generated
confirmation of such transmission (and provided the above-stated written
confirmation is sent) or (iii) if by registered or certified mail, upon actual
receipt; provided, however, that requests from any Borrower to the
Administrative Agent or the Banks or any other Loan Party pursuant to any of the
provisions hereof including, without limitation, Section 2 and Section 6.1 of
this Agreement, shall not be effective until actually received by the
Administrative Agent or the Banks or such other Loan Party, as the case may be.
Notices or other communications hereunder shall be addressed, if to the
Borrowers, at the address specified on the signature pages of this Agreement; if
to the Administrative Agent, at the address of the Administrative Agent
specified on the signature pages of this Agreement, and, if to a Bank or other
Loan Party, at the address of such Bank or other Loan Party specified on the
signature pages of this Agreement.

         13.14    GOVERNING LAW.

                  This Agreement and the Loan Documents and the respective
rights and obligations of the parties hereto shall be governed by and construed
in accordance with the internal laws of the State of Illinois (without giving
effect to the conflict of laws rules thereof).

         13.15    ENTIRE AGREEMENT.

                  This Agreement, including the exhibits and schedules thereto,
each Additional Borrower Addendum and the Loan Documents constitute the entire
contract between the parties relative to the subject matter hereof. Except for
those fee letters contemplated by Section 2.12 of this Agreement and the Interim
Waiver Letter, if any, attached hereto as Annex VI, any previous agreement among
the parties with respect to the subject matter hereof is superseded by this
Agreement and the Loan Documents. Nothing in this Agreement or in the Loan
Documents, expressed or implied, is intended to confer upon any party other than
the parties hereto and thereto any rights, remedies, obligations or liabilities
under or by reason of this Agreement or the Loan Documents.

                                       81
<PAGE>

         13.16    WAIVER OF SOVEREIGN IMMUNITY.

                  To the extent that any Borrower has or hereafter may acquire
any immunity from the jurisdiction of any court or from any legal process
(whether through service or notice, attachment prior to judgment, attachment in
aid of execution, execution, or otherwise) with respect to itself or its
property, each Borrower hereby irrevocably waives such immunity in respect of
its obligations under this Agreement and any other document or agreement
executed or given in connection therewith, and each Borrower agrees that it will
not raise or claim any such immunity at or in respect of any such action or
proceeding.

         13.17    JURY TRIAL WAIVER.

                  EACH OF THE BORROWERS, THE ADMINISTRATIVE AGENT AND EACH OF
THE BANKS AND OTHER LOAN PARTIES WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN
RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, AMONG
THE BORROWERS, THE ADMINISTRATIVE AGENT, THE BANKS AND THE OTHER LOAN PARTIES,
OR ANY THEREOF, ARISING OUT OF, IN CONNECTION WITH, RELATED TO, OR INCIDENTAL TO
THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT OR ANY
REVOLVING CREDIT NOTE OR ANY TERM NOTE OR OTHER LOAN DOCUMENT OR OTHER
INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH
OR THE TRANSACTIONS RELATED THERETO.

         13.18    JURISDICTION; VENUE; INCONVENIENT FORUM.

                  (a)      JURISDICTION.

                           EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND
         UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE
         NONEXCLUSIVE JURISDICTION OF ANY OHIO STATE COURT OR FEDERAL COURT OF
         THE UNITED STATES OF AMERICA SITTING IN CUYAHOGA COUNTY, OHIO OR ANY
         ILLINOIS STATE COURT OR FEDERAL COURT OF THE UNITED STATES OF AMERICA
         SITTING IN COOK COUNTY, ILLINOIS, AND ANY APPELLATE COURT FROM ANY
         THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
         AGREEMENT, THE REVOLVING CREDIT NOTES, THE TERM NOTES OR ANY LOAN
         DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH
         OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES
         THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE
         HEARD AND DETERMINED IN ANY SUCH OHIO STATE OR ILLINOIS STATE, OR, TO
         THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES
         HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING
         SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT
         ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS
         AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY PARTY MAY OTHERWISE HAVE TO
         BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT, THE
         REVOLVING CREDIT NOTES, THE TERM NOTES OR ANY LOAN DOCUMENT IN THE
         COURTS OF ANY JURISDICTION.

                                       82
<PAGE>

                  (b)      VENUE; INCONVENIENT FORUM.

                           EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND
         UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT MAY LEGALLY AND
         EFFECTIVELY DO SO, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO
         THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
         RELATING TO THIS AGREEMENT, THE REVOLVING CREDIT NOTES, THE TERM NOTES
         OR ANY OTHER LOAN DOCUMENT IN ANY OHIO STATE OR FEDERAL COURT SITTING
         IN OHIO OR IN ANY ILLINOIS STATE OR FEDERAL COURT SITTING IN ILLINOIS.
         EACH OF THE PARTIES HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
         PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE
         MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

                           EACH OF THE BORROWERS CONFIRMS THAT THE FOREGOING
         WAIVERS IN SECTIONS 13.17, 13.18(a) and 13.18(b) ARE INFORMED AND
         FREELY MADE.

         13.19    EXECUTION IN COUNTERPARTS.

                  This Agreement may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute but one and the same agreement.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       83
<PAGE>

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

                                    BORROWERS

                                    ERICO INTERNATIONAL CORPORATION

                                         /s/ Peter B. Korte
                                    --------------------------------------------
                                    By:  Peter B. Korte
                                    Its: Treasurer

                                    Address for notices:

                                    30575 Bainbridge Road, Suite 300
                                    Solon, Ohio 44139
                                    Telecopy: 440-349-2996
                                    Attention: ---------------------------------

                                    ERICO PRODUCTS, INC.

                                         Peter B. Korte
                                    --------------------------------------------
                                    By:  Peter B. Korte
                                    Its: Treasurer

                                    Address for notices:

                                    30575 Bainbridge Road, Suite 300
                                    Solon, Ohio 44139
                                    Telecopy: 440-349-2996
                                    Attention: ---------------------------------

                                      S-1

<PAGE>

                                    ERICO EUROPA B.V.

                                         /s/ William H. Roj
                                    --------------------------------------------
                                    By:  William H. Roj
                                    Its: Director

                                    Address for notices:

                                    30575 Bainbridge Road, Suite 300
                                    Solon, Ohio 44139
                                    Telecopy: 440-349-2996
                                    Attention: ---------------------------------

                                      S-2

<PAGE>

                                    ADMINISTRATIVE AGENT

                                    LASALLE BANK NATIONAL ASSOCIATION,
                                    as Administrative Agent and Lead Arranger

                                         /s/ Jefferson M. Green
                                    --------------------------------------------
                                    By:  Jefferson M. Green
                                    Its: First Vice President

                                    Address for Notices:

                                    LaSalle Bank National Association
                                    1300 East Ninth Street, Suite 1000
                                    Cleveland, Ohio 44114
                                    Telecopy: (216) 802-2212

                                    Lending Office:

                                    LaSalle Bank National Association
                                    135 S. South LaSalle Street
                                    Chicago, Illinois 60603
                                    Attn:  Helen Coufoudakis
                                    Telecopy: (312) 904-6999
                                    ABA #071000505 Account 1378018-RC-7300
                                    Reference: ERICO International

                                    Alternate Currency Lending Office:

                                      S-3

<PAGE>

                                    BANKS
                                    LASALLE BANK NATIONAL ASSOCIATION,
                                    as a Bank and Issuing Bank

                                         /s/ Jefferson M. Green
                                    --------------------------------------------
                                    By:  Jefferson M. Green
                                    Its: First Vice President

                                    Address for Notices:

                                    LaSalle Bank National Association
                                    1300 East Ninth Street, Suite 1000
                                    Cleveland, Ohio 44114
                                    Telecopy: (216) 802-2212

                                    Lending Office:

                                    LaSalle Bank National Association
                                    135 S. South LaSalle Street
                                    Chicago, Illinois 60603
                                    Attn:  Helen Coufoudakis
                                    Telecopy: (312) 904-6999
                                    ABA #071000505 Account 1378018-RC-7300
                                    Reference: ERICO International

                                    Alternate Currency Lending Office:

                                      S-4

<PAGE>

                                    NATIONAL CITY BANK, as a Bank and as
                                    Syndication Agent

                                         /s/ Patrick M. Pastore
                                    --------------------------------------------
                                    By:  Patrick M. Pastore
                                    Its: Senior Vice President

                                    Address for Notices:

                                    National City Bank
                                    1900 East Ninth Street Loc. 01-2083
                                    Cleveland, Ohio 44114
                                    Attention: North Coast Middle Market
                                    Telecopy: (216) 222-9396

                                    Lending Office:

                                    National City Bank
                                    1900 East Ninth Street Loc. 01-2083
                                    Cleveland, Ohio 44114
                                    Attention: North Coast Middle Market
                                    Telecopy: (216) 222-9396

                                    Payment Office:

                                    National City Bank
                                    2300 Mill Creek Boulevard
                                    Highland Hill, Ohio 44122
                                    Attention:  David Gregory
                                    ABA # 041000124 Account No. 151810
                                    Reference: ERICO International

                                      S-5

<PAGE>

                                    KEYBANK NATIONAL ASSOCIATION, as a
                                    Bank and as Documentation Agent

                                         /s/ Babette C. Schubert
                                    --------------------------------------------
                                    By:  Babette C. Schubert
                                    Its: Senior Vice President

                                    Address for Notices:

                                    800 Superior Avenue, Third Floor
                                    Cleveland, Ohio 44114
                                    Attention: Cleveland Middle Market Corporate
                                               Banking
                                    Telecopy: (216) 828-9632

                                    Lending Office:

                                    KeyBank National Association
                                    127 Public Square
                                    Cleveland, Ohio 44114
                                    Attention: Cleveland Middle Market Corporate
                                               Banking.
                                    Telecopy: (216) 689-4555

                                    Payment Office:

                                    KeyBank National Association
                                    127 Public Square
                                    Cleveland, Ohio  44114
                                    ABA # 041001039   Account No. --------------
                                    Beneficiary: ---------------------
                                    Reference:  ERICO International

                                      S-6

<PAGE>

                                    GENERAL ELECTRIC CAPITAL
                                    CORPORATION, as a Bank, Co-Lead Arranger
                                    and Co-Documentation Agent

                                         /s/ Christopher Cox
                                    --------------------------------------------
                                    By:  Christopher Cox
                                    Its: Duly Authorized Signatory

                                    Address for Notices:

                                    General Electric Capital Corporation
                                    335 Madison Avenue
                                    New York, NY  10017
                                    Attn: ERICO Account Manager
                                    Telecopy: 212-309-8798

                                    Lending Office:

                                    201 High Ridge Road
                                    Stamford, CT 06927
                                    Attn: ERICO Portfolio Analyst
                                    Account Name: GECC CAF Depository
                                    Bank Name: Bankers Trust
                                    90 Hudson Street
                                    Jersey City, NJ 07302
                                    ABA #: 021-001-033
                                    Acct: #: 50-232-854

                                      S-7
<PAGE>

                            ACKNOWLEDGMENT OF HOLDING

         The undersigned consents and agrees to and acknowledges the terms of
the foregoing Second Amended and Restated Multicurrency Credit and Security
Agreement, dated as of December 2, 2002. The undersigned further agrees that the
obligations of the undersigned pursuant to the Pledge Agreement - ERICO Holding
Company, dated June 30, 1999, and any other Loan Document to which the
undersigned is a party shall remain in full force and effect and be unaffected
hereby.

                                              ERICO HOLDING COMPANY

                                                   /s/ William H. Roj
                                              ----------------------------------
                                              By:  William H. Roj
                                              Its: Secretary

                                              Address for notices:

                                              30575 Bainbridge Road, Suite 300
                                              Solon, Ohio 44139
                                              Telecopy: 440-349-2996
                                              Attention:

                                       S-8

<PAGE>

                                     ANNEX I

                                   COMMITMENTS

         Amended and Restated Credit Agreement, dated as of May 2, 2002,

   among ERICO International Corporation, other Borrowers, the Administrative
   Agent, the Lead Arranger, the Co-Lead Arranger, the Syndication Agent, the
Documentation Agent, the Co-Documentation Agent, the Issuing Bank and the Banks

<TABLE>
<CAPTION>
                                        Revolving Credit                     Bank's Total      Bank's
              Bank                         Commitment      Term Commitment    Commitment     Percentage
=======================================================================================================
<S>                                     <C>                <C>               <C>             <C>
LaSalle Bank National Association         $25,000,000        $15,000,000     $ 40,000,000     33.3333%
-----------------------------------------------------------------------------------------------------
National City Bank                        $15,625,000        $ 9,375,000     $ 25,000,000     20.8333%
-----------------------------------------------------------------------------------------------------
General Electric Capital Corporation      $21,875,000        $13,125,000     $ 35,000,000     29.1667%
-----------------------------------------------------------------------------------------------------
KeyBank National Association.             $12,500,000        $ 7,500,000     $ 20,000,000     16.6667%
=====================================================================================================
Aggregate Bank Commitments                $75,000,000        $45,000,000     $120,000,000    100.0000%
=====================================================================================================
</TABLE>

<PAGE>

                                    ANNEX II

                                   DEFINITIONS

         As used in this Agreement, the following terms shall have the following
meanings (such meanings to be equally applicable to both the singular and plural
forms of the terms defined):

                  "ACCOUNT" means "account" as defined in the UCC.

                  "ACCOUNT DEBTOR" means any Person who is or becomes obligated
         to a Borrower under, with respect to, or on account of an Account.

                  "ACCUMULATED FUNDING DEFICIENCY" has the meaning ascribed
         thereto in Section 302(a)(2) of ERISA.

                  "ACQUISITION AGREEMENT" means each agreement to purchase all
         or substantially all of the assets or stock of another Person in
         connection with a Permitted Acquisition.

                  "ACQUISITION DOCUMENTS" means any agreement, or other
         instrument, financial statement, audit report, environmental audit,
         notice, officer's certificate or other writing of any kind delivered
         with respect to the consummation of any Permitted Acquisition,
         including, without limitation, each Acquisition Agreement.

                  "ADDITIONAL BORROWER ADDENDUM" means the Additional Borrower
         Addendum for Additional Borrower the form of which is set forth as
         Annex VI to this Agreement.

                  "ADMINISTRATIVE AGENT" means LaSalle Bank National
         Association, in its capacity as Administrative Agent for the Banks.

                  "ADVANCE" means a Revolving Credit Advance or a Term Advance
         to a Borrower.

                  "ADVANTAGE" means any payment (whether made voluntarily or
         involuntarily, by offset of any deposit or other Indebtedness or
         otherwise) received by a Bank in respect of the Obligations if the
         payment results in any other Bank's having more than its Ratable
         Portion of the Obligations in question.

                  "ADVERTISING PERMISSION LETTER" means the Advertising
         Permission letter described on Annex III, as amended from time to time,
         substantially in the form attached hereto as Exhibit L and by reference
         made a part hereof.

                  "AFFILIATE" means, with respect to a specified Person, any
         other Person: (a) which directly or indirectly through one or more
         intermediaries Controls, or is Controlled by, or is under common
         Control with such Person, (b) which beneficially owns or holds with
         power to vote five percent (5%) or more of any class of the voting
         stock of such Person, (c) five percent (5%) or more of the voting stock
         which is beneficially owned or held by such Person, (d) which is a
         branch or other affiliate of such Person if such Person is a Bank or
         (e) who is an officer or director of such Person.

                  "AFFILIATE FRONTING BANK" means LaSalle Bank National
         Association in its capacity as an issuer of Letters of Credit.

<PAGE>

                  "AFFILIATE FRONTING BANK LC" means a Standby Letter of Credit,
         denominated in an Alternate Currency or Dollars, issued by the
         Affiliate Fronting Bank for the benefit of an Affiliate of LaSalle Bank
         National Association which has extended credit to a Non-US Subsidiary.

                  "AFFILIATE FRONTING BANK LC EXPOSURE" means, at any time of
         determination, the sum of: (a) the aggregate undrawn amount of all
         Affiliate Fronting Bank LCs, outstanding at such time and (b) the
         aggregate amount that has been drawn under such Affiliate Fronting Bank
         LCs as to which the Affiliate Fronting Bank has not at such time been
         reimbursed by International or any other Borrower.

                  "AFFILIATE LOANS" has the meaning specified in Section 9.1 of
         this Agreement.

                  "AGREEMENT" means this Multicurrency Credit and Security
         Agreement and each amendment, supplement or modification, if any, to
         this Multicurrency Credit and Security Agreement.

                  "AGREEMENT CURRENCY" has the meaning specified in Section
         13.4(b) of this Agreement.

                  "ALTERNATE BASE RATE" means, for any day, a rate per annum
         equal to the higher of: (a) the rate of interest which is established
         from time to time by LaSalle at its principal office in Chicago,
         Illinois as its "prime rate" or "base rate" in effect, such rate to be
         adjusted automatically, without notice, as of the opening of business
         on the effective date of any change in such rate (it being agreed that:
         (i) such rate is not necessarily the lowest rate of interest then
         available from LaSalle on fluctuating rate loans and (ii) such rate may
         be established by LaSalle by public announcement or otherwise) and (b)
         the Federal Funds Rate in effect on such day plus one half of one
         percent (1/2 of 1%).

                  "ALTERNATE BASE RATE ADVANCE" means, collectively, Revolving
         Credit Alternate Base Rate Advances and Term Alternate Base Rate
         Advances.

                  "ALTERNATE BASE RATE BORROWING" means a Borrowing consisting
         of Alternate Base Rate Advances.

                  "ALTERNATE CURRENCY" means (i) Australian dollars, Euros,
         Swiss francs, Swedish kronas or British pounds or (ii) such other
         currency other than Dollars that is readily available, freely traded
         and convertible into Dollars in the New York market and as to which an
         Exchange Rate may be calculated and selected by a Borrower and approved
         by all of the Banks and the Administrative Agent.

                  "ALTERNATE CURRENCY ADVANCE" means any Advance denominated in
         an Alternate Currency made to a Borrower. Each Alternate Currency
         Advance shall be a LIBOR Advance.

                  "ALTERNATE CURRENCY LENDING OFFICE" means, with respect to any
         Bank, the office of such Bank or the office of such Bank's
         correspondent bank specified as its "Alternate Currency Lending Office"
         below its name on the signature pages hereto (or, if no such office is
         specified, its Domestic Lending Office), or such other office of such
         Bank or office of such Bank's correspondent bank as such Bank may from
         time to time specify to the Borrower and the Agent in writing.

                  "APPLICABLE CREDITOR" has the meaning specified in Section
         13.4(b) of this Agreement.

                                       2

<PAGE>

                  "APPROVED SECURITIES INTERMEDIARY" means a Securities
         Intermediary or Commodity Intermediary selected or approved by the
         Agent and with respect to which the Borrower has delivered to the Agent
         an executed Control Account Letter.

                  "ANNIVERSARY DATE" shall mean the annual anniversary of the
         Restatement Date.

                  "ASSIGNMENT AGREEMENT" has the meaning specified in Section
         11.1 of this Agreement.

                  "BANKS" means the banks listed on the signature pages hereof
         and the successors thereto and assignees thereof.

                  "BORROW" means to obtain a Revolving Credit Advance.

                  "BORROWERS" means each and every one of Europa, ERICO Products
         or International and such other Wholly-Owned Subsidiary of
         International or ERICO Products, as may from time to time execute an
         Additional Borrower Addendum which is accepted by the Administrative
         Agent and all of the Loan Parties pursuant to Section 1.6 of this
         Agreement and otherwise satisfies the terms and conditions of this
         Agreement.

                  "BORROWER GUARANTY" means the obligation of the Borrower
         Guarantors to pay the Obligations of the other Borrowers pursuant to
         Section 9 of this Agreement.

                  "BORROWER GUARANTOR" means each Borrower which is a US
         Subsidiary.

                  "BORROWER REPRESENTATIVE" means ERICO International
         Corporation, an Ohio corporation.

                  "BORROWING" means a group of Advances of a single Type, in a
         single currency, made by the Banks on a single date to a single
         Borrower and as to which a single Interest Period is in effect (i.e.,
         any group of Advances made by the Banks of a different Type, or having
         a different Interest Period (regardless of whether such Interest Period
         commences on the same date as another Interest Period), or made on a
         different date shall be considered to comprise a different Borrowing).

                  "BUSINESS DAY" means: (i) a day of the year on which banks are
         not required or authorized to close in Cleveland, Ohio, or Chicago,
         Illinois and (ii) if the applicable Business Day relates to LIBOR
         Advances, a day of the year which is a Business Day described in clause
         (i) above and which is also a day on which dealings in Dollar deposits
         are carried on in the London interbank market and banks are open for
         business in London and (iii) if the applicable Business Day relates to
         Alternative Currency Advances, a day of the year which is a Business
         Day described in clause (ii) above and which is also a day on which the
         banks are open for general banking business in the city which is the
         principal financial center of the country of issuance of such Alternate
         Currency.

                  "CAPITAL EXPENDITURES" means, in respect of a Person, any and
         all amounts invested, expended or incurred (including Indebtedness
         under Capitalized Leases) by a Person in respect of the purchase,
         acquisition, improvement, renovation or expansion of any land and
         depreciable or amortizable property of such Person (including, without
         limitation, expenditures required to be capitalized in accordance with
         GAAP and including both the "hard costs" of equipment purchases and the
         "soft costs" of equipment installation and similar expenditures), each
         as determined on a consolidated basis in accordance with GAAP.

                                       3

<PAGE>

                  "CAPITALIZED LEASES" means, in respect of any Person, any
         lease of property imposing obligations on such Person, as lessee of
         such property, which are required in accordance with GAAP to be
         capitalized on a balance sheet of such Person.

                  "CERCLA" means the Comprehensive Environmental Response,
         Compensation and Liability Act, as amended, 42 U.S.C. Sections 9601 et
         seq.

                  "CHANGE IN CONTROL" means, at any date of determination: (i)
         the failure of CVC and/or William H. Roj (other than by reason of any
         transfer by such a shareholder to any Affiliate of such shareholder or
         the immediate family of such shareholder, including any transfer by
         reason of the death, disability or incompetence of such shareholder),
         to have beneficial ownership (within the meaning of Rule 13d-3 of the
         Securities and Exchange Commission under such Act) or control of more
         than fifty-one percent (51%) (disregarding any director qualifying
         share ownership) of the combined voting power or economic benefit of
         the then outstanding common shares of ERICO Global (or any successor,
         by operation of law or otherwise, or assignee thereof) entitled to vote
         generally in the election of directors of Global (a "ERICO Global
         Change of Control"), (ii) the ceasing of ERICO Global to have
         beneficial ownership (within the meaning of Rule 13d-3 of the
         Securities and Exchange Commission under such Act) or control of one
         hundred percent (100%) (disregarding any director qualifying share
         ownership) of the combined voting power or economic benefit of the then
         outstanding common shares of Holding (or any successor, by operation of
         law or otherwise, or assign thereof) entitled to vote generally in the
         election of directors of International, (iii) the ceasing of Holding to
         have beneficial ownership (within the meaning of Rule 13d-3 of the
         Securities and Exchange Commission under such Act) or control of one
         hundred percent (100%) (disregarding any director qualifying share
         ownership) of the combined voting power or economic benefit of the then
         outstanding common shares of International (or any successor, by
         operation of law or otherwise, or assign thereof) entitled to vote
         generally in the election of directors of International, and (iv) the
         ceasing of International or any of its wholly-owned Subsidiaries to
         have beneficial ownership (within the meaning of Rule 13d-3 of the
         Securities and Exchange Commission under such Act) or control of one
         hundred percent (100%) (disregarding any director qualifying share
         ownership) of the combined voting power or economic benefit of the then
         outstanding common shares of the Borrowers (other than International)
         (or any successor, by operation of law or otherwise, or assign thereof)
         entitled to vote generally in the election of directors of such
         Borrowers.

                  "CHARTER DOCUMENTS" means, as to any Person (other than a
         natural person), the charter, certificate or articles of incorporation,
         by-laws, regulations, general or limited partnership agreement,
         certificate of limited partnership, certificate of formation, operating
         agreement, or other similar organizational or governing documents of
         such Person.

                  "CHATTEL PAPER" means and includes "chattel paper" as defined
         in the UCC.

                  "CLOSING DATE" means May 2, 2002, the closing date of the
         Original Credit Agreement.

                  "CODE" means the Internal Revenue Code of 1986, as amended.

                  "CO-DOCUMENTATION AGENT" means General Electric Capital
         Corporation, in its capacity as Co-Documentation Agent.

                  "CO-LEAD ARRANGER" means General Electric Capital Corporation,
         in its capacity as Co-Lead Arranger.

                                       4

<PAGE>

                  "COLLATERAL" means all assets of the Pledging Borrowers in
         which a security interest or Lien is granted to the Administrative
         Agent for the benefit of the Banks pursuant to Section 4.1 hereof to
         secure repayment of the Obligations and all other property of the
         Pledging Borrower (including the real property and fixtures referenced
         in Section 4.2) in which a Lien is granted to the Administrative Agent
         for the benefit of the Banks to secure repayment of the Obligations.

                  "COLLATERAL LOCATIONS" means those U.S. locations of the
         Pledging Borrowers set forth on the Supplemental Schedule attached
         hereto.

                  "COLLECTIONS" means all payments to a Borrower from Account
         Debtors in respect of Accounts.

                  "COMBINED BASIS" means, in respect of any Cumulative Four
         Quarter Period, determination of all amounts specified in clause (i)
         through (vi) of the definition of Consolidated EBITDA, on a basis which
         combines: (i) the specified amount determined with respect to
         International and its Subsidiaries on a consolidated basis and (ii) the
         specified amount determined with respect to any business acquired
         during such period as if such business were consolidated with
         International and its Subsidiaries for the immediately preceding
         Cumulative Four Quarter Period, provided, however, that the specified
         amount determined with respect to any business sold during such period
         shall be deleted from any such determination in respect of the
         immediately preceding Cumulative Four Quarter Period.

                  "COMMODITY ACCOUNT" means and includes a "commodity account"
         as defined in the UCC.

                  "COMMODITY INTERMEDIARY" means a "commodity intermediary" as
         defined in the UCC.

                  "CONSOLIDATED CAPITAL EXPENDITURES" means, for any period, all
         Capital Expenditures of International and its Subsidiaries during such
         period, as determined on a consolidated basis in accordance with GAAP.

                  "CONSOLIDATED DEPRECIATION AND AMORTIZATION EXPENSE" means,
         for any period, the amount of depreciation and amortization expense of
         International and its Subsidiaries for such period as determined on a
         consolidated basis in accordance with GAAP.

                  "CONSOLIDATED EBITDA" means, for any Cumulative Four Quarter
         Period, (i) the Consolidated Net Income for such period plus (ii) the
         Consolidated Interest Expense for such period plus (iii) the
         Consolidated Income Tax Expense for such period plus (iv) the
         Consolidated Depreciation and Amortization Expense for such period plus
         (v) other consolidated non-cash Extraordinary losses minus non-cash
         Extraordinary gains for such period, plus (vi) one time non-cash
         restructuring expense in connection with Permitted Acquisitions for
         such period, plus (without duplication) (vii) one-time financing,
         transaction costs or fees related to the Merger or the financing
         thereof not to exceed $8,000,000 plus (viii) for the periods ending
         prior to December 31, 2003, the compensation and expenses relating to
         certain officers of Holding that have actually been paid in cash on or
         before December 2, 2002, and which will not continue to be paid after
         such date, in an aggregate amount not to exceed, for the Cumulative
         Four Quarter Period ending December 31, 2002, $3,400,000; for the
         Cumulative Four Quarter Period ending March 31, 2003, $2,500,000; for
         the Cumulative Four Quarter Period ending June 30, 2003, $1,600,000,
         and; for the Cumulative Four Quarter Period ending September 30,

                                       5

<PAGE>

         2003, $700,000. Notwithstanding the forgoing, unrealized gains and
         losses resulting from foreign currency exchanges related to the
         Australian borrowing shall not be reflected in the calculation of
         Consolidated EBITDA.

                  "CONSOLIDATED ERICO PRODUCTS EBITDA" means, for any Cumulative
         Four Quarter Period, (i) that portion of the Consolidated Net Income
         for such period which is attributable to ERICO Products and any of its
         US Subsidiaries plus (ii) that portion of the Consolidated Interest
         Expense for such period which is attributable to ERICO Products and any
         of its US Subsidiaries plus (iii) that portion of the Consolidated
         Income Tax Expense for such period which is attributable to ERICO
         Products and any of its US Subsidiaries plus (iv) that portion of the
         Consolidated Depreciation and Amortization Expense for such period that
         is attributable to ERICO Products and any of its US Subsidiaries plus
         (v) other consolidated non-cash Extraordinary losses minus non-cash
         Extraordinary gains for such period which are attributable to ERICO
         Products and any of its US Subsidiaries, plus (vi) one time non-cash
         restructuring expenses in connection with Permitted Acquisitions for
         such period that are attributable to ERICO Products and any of its US
         Subsidiaries, plus (without duplication) (vii) that portion of the
         one-time financing costs related to the Merger which are attributable
         to ERICO Products and any of its US Subsidiaries, not to exceed
         $8,000,000 in the aggregate, plus (viii) for the periods ending prior
         to December 31, 2003, the compensation and expenses relating to certain
         officers of Holding that have actually been paid in cash on or before
         December 2, 2002, and which will not continue to be paid after such
         date, in an aggregate amount not to exceed, for the Cumulative Four
         Quarter Period ending December 31, 2002, $3,400,000; for the Cumulative
         Four Quarter Period ending March 31, 2003, $2,500,000; for the
         Cumulative Four Quarter Period ending June 30, 2003, $1,600,000, and;
         for the Cumulative Four Quarter Period ending September 30, 2003,
         $700,000.

                  "CONSOLIDATED EXCESS CASH FLOW" means, with respect to a
         Person, for any period of determination, the excess of: (a) the
         Consolidated EBITDA of such Person and its consolidated Subsidiaries
         for such period over (b) the sum of (i) the Consolidated Fixed Charges
         of such Person and its consolidated Subsidiaries for such period minus
         (ii) any decrease (or plus any increase) in Consolidated Working
         Capital from the last day of the immediately preceding period to the
         last day of such period plus (iii) any voluntary prepayment of
         outstanding Term Loans pursuant to Section 2.9(e) during such period.

                  "CONSOLIDATED FIXED CHARGES" means, with respect to a Person,
         for any period of determination, the sum of: (a) the Consolidated
         Interest Expense of such Person and its consolidated Subsidiaries for
         such period, plus (b) the Consolidated Income Tax Expense of such
         Person and its consolidated Subsidiaries during such period, plus (c)
         the Consolidated Capital Expenditures of such Person and its
         consolidated Subsidiaries for such period, plus (d) all scheduled and
         mandatory principal payments (including the principal payment portion
         of any scheduled Capitalized Lease rental payments) of such Person and
         its consolidated Subsidiaries made during such period with respect to
         the Consolidated Senior Debt plus the Consolidated Subordinated Debt,
         all as determined on a consolidated basis in accordance with GAAP.

                  "CONSOLIDATED FIXED CHARGE COVERAGE RATIO" means, for any
         Cumulative Four Quarter Period, the ratio of: (a) the Consolidated
         EBITDA minus the Consolidated Capital Expenditures minus the
         Consolidated Income Tax Expense actually paid in cash during such
         period to (b) the sum of (without duplication) (i) Consolidated
         Interest Expense plus, (ii) the scheduled principal payments in respect
         of Consolidated Senior Debt and Consolidated Subordinated Debt as at
         the Fiscal Quarter ending immediately prior to the Cumulative Four
         Quarter Period in question, plus (iii) cash Distributions made by
         International to its shareholders, but excluding Distributions made in
         connection

                                       6

<PAGE>

         with the Merger, Distributions made prior to the Restatement Date and
         Distributions made for payment of regularly scheduled interest payments
         under the Holding Senior Subordinated Indenture.

                  "CONSOLIDATED FUNDED DEBT TO CONSOLIDATED NET WORTH RATIO"
         means for any period, the ratio of: (a) the Consolidated Senior Debt
         plus (ii) the Consolidated Subordinated Debt to (b) Consolidated Net
         Worth, as calculated on a combined basis.

                  "CONSOLIDATED FUNDED DEBT TO EBITDA RATIO" means, for any
         Cumulative Four Quarter Period, the ratio of: (a) the sum of (i) the
         Consolidated Senior Debt plus (ii) the Consolidated Subordinated Debt
         to (b) Consolidated EBITDA, as calculated on a Combined Basis.

                  "CONSOLIDATED FUNDED DEBT TO ERICO PRODUCTS EBITDA RATIO"
         means, for any Cumulative Four Quarter Period, the ratio of: (a) the
         sum of (i) the Consolidated Senior Debt plus (ii) the Consolidated
         Subordinated Debt to (b) Consolidated ERICO Products EBITDA, as
         calculated on a Combined Basis.

                  "CONSOLIDATED INCOME TAX EXPENSE" means, for any period, the
         amount of income tax expense of International and its Subsidiaries for
         such period as determined on a consolidated basis in accordance with
         GAAP.

                  "CONSOLIDATED INTEREST EXPENSE" means, for any period, (a) the
         amount of interest expense of International and its Subsidiaries for
         such period on the aggregate principal amount of the Indebtedness of
         International and its Subsidiaries plus any capitalized interest of
         International and its Subsidiaries which accrued during such period,
         each as determined on a consolidated basis in accordance with GAAP plus
         (b) the interest expense associated with the Holding Senior
         Subordinated Indebtedness.

                  "CONSOLIDATED NET INCOME" means, for any period, net income
         (or loss) of International and its Subsidiaries for such period (after
         taxes and Extraordinary items), as determined on a consolidated basis
         in accordance with GAAP.

                  "CONSOLIDATED NET WORTH" means, as of the date of
         determination, all amounts that would be included under the caption
         "shareholders' equity" (or any like caption) on a balance sheet of
         International, excluding any and all adjustments pursuant to FAS 52 and
         as determined on a consolidated basis in accordance with GAAP as at
         such date.

                  "CONSOLIDATED SENIOR DEBT" means, at any date of
         determination, all Indebtedness for borrowed money (other than
         Subordinated Indebtedness) of International and its Subsidiaries
         outstanding as of such date including, without limitation, (i)
         Capitalized Leases, and (ii) the then outstanding amount of principal,
         interest and fees owing to the Bank under this Agreement, each as
         determined on a consolidated basis in accordance with GAAP.

                  "CONSOLIDATED SENIOR FUNDED DEBT TO EBITDA RATIO" means, for
         any Cumulative Four Quarter Period, the ratio of: (a) the Consolidated
         Senior Debt to (b) Consolidated EBITDA, as calculated on a Combined
         Basis.

                  "CONSOLIDATED SUBORDINATED DEBT" means, at any date of
         determination, (a) all indebtedness for borrowed money constituting
         Subordinated Indebtedness of International and its Subsidiaries
         outstanding as of such date, and (b) Holding Senior Subordinated
         Indebtedness outstanding as of such date, as determined on a
         consolidated basis in accordance with GAAP.

                                       7

<PAGE>

                  "CONSOLIDATED TOTAL ASSETS" means, at any date of
         determination, the aggregate net book value of all such assets of
         International and its Subsidiaries at such date (after deducting any
         applicable reserves and without giving consideration to any reappraisal
         or write-up of assets after December 31, 1996), as determined on a
         consolidated basis in accordance with GAAP.

                  "CONSOLIDATED TOTAL LIABILITIES" means, at any date of
         determination, the aggregate of all liabilities of International and
         its Subsidiaries, as determined on a consolidated basis in accordance
         with GAAP.

                  "CONSOLIDATED WORKING CAPITAL" means, with respect to a
         Person, as of any date of determination, the excess of consolidated
         current assets of such Person and its Subsidiaries on such date over
         the consolidated current liabilities of such Person and its
         Subsidiaries on such date, all as determined on a consolidated basis in
         accordance with GAAP.

                  "CONTROL" means the possession, directly or indirectly, of the
         power to direct or cause the direction of the management and policies
         of a Person, whether through the ownership of voting securities, by
         contract or otherwise.

                  "CONTROL ACCOUNT" means a Securities Account or Commodity
         Account maintained by the Borrower with an Approved Securities
         Intermediary which account is the subject of an effective Control
         Account Letter, and includes all Financial Assets held therein and all
         certificates and instruments, if any, representing or evidencing the
         Financial Assets contained therein.

                  "CONTROL ACCOUNT LETTER" means a letter agreement, in a form
         acceptable to by the Agent, executed by the Borrower and the Agent and
         acknowledged and agreed to by the relevant Approved Securities
         Intermediary.

                  "CREDIT EVENT" means: (a) the incurrence of the obligation of
         (i) each Bank to make a Revolving Credit Advance on the occasion of
         each Revolving Credit Borrowing, (ii) each Bank to make a Term Advance
         and (iii) the Issuing Bank to issue Letters of Credit hereunder (b) the
         making by any Bank of a Revolving Credit Advance or Term Advance (c)
         the issuance or renewal of any Letter of Credit, (d) the delivery by
         the Borrower of (i) a Credit Request requesting a Revolving Credit
         Borrowing or (ii) a Rate Conversion/Continuation Request requesting the
         conversion or continuation of Revolving Credit Borrowings, (d) a Rate
         Conversion or Rate Continuation or (f) the acceptance by the Borrower
         of proceeds of any Revolving Credit Borrowing or Term Borrowing.

                  "CREDIT REQUEST" has the meaning specified in Section 2.2(a)
         of this Agreement with respect to a request by a Borrower for a
         Revolving Credit Borrowing.

                  "CUMULATIVE FOUR QUARTER PERIOD" means, the period consisting
         of four consecutive Fiscal Quarters, whether or not in the same Fiscal
         Year of International.

                  "CVC" means collectively, Citicorp Venture Capital Equity
         Partners, L.P., a Delaware limited partnership, CVC Executive Fund LLC,
         a Delaware limited liability company, CVC/SSB Employee Fund, L.P., a
         Delaware limited partnership, and the general partners or managing
         members of each.

                  "DEEMED CREDIT REQUEST" has the meaning specified in Section
         2.2(b) of this Agreement.

                                       8

<PAGE>

                  "DEFAULT UNDER ERISA" means: (a) the occurrence or existence
         of a material Accumulated Funding Deficiency in respect of any Employee
         Benefit Plan within the scope of Section 302(a) of ERISA, or (b) any
         failure by any Borrower or any Subsidiary to make a full and timely
         payment of premiums required by Section 4007 of ERISA in respect of any
         Employee Benefit Plan, or (c) the occurrence or existence of any
         material liability under Section 4062, 4063, 4064 or 4069 of ERISA in
         respect of any Employee Benefit Plan, or (d) the occurrence or
         existence of any material breach of any other law or regulation in
         respect of any such Employee Benefit Plan, or (e) the institution or
         existence of any action for the forcible termination of any such
         Employee Benefit Plan which is within the scope of Section 4001(a)(15)
         of ERISA.

                  "DEFAULT RATE" has the meaning set forth in Section 2.13(e) of
         this Agreement.

                  "DEPOSIT ACCOUNT" means and includes a "deposit account" as
         defined in the UCC.

                  "DETERMINATION DATE" means either the Margin Adjustment Date
         or the Facility Fee Percentage Determination Date, as the case may be.

                  "DISTRIBUTION" means, in respect to a Person, a payment made,
         liability incurred or other consideration (other than any stock
         dividend or stock split payable solely in capital stock of such Person)
         given by such Person for the purchase, acquisition, redemption or
         retirement of any capital stock (whether added to treasury or
         otherwise) of such Person or as a dividend, return of capital or other
         distribution in respect of the capital stock of such Person.

                  "DOCUMENT" means and includes a "document" as defined in the
         UCC.

                  "DOCUMENTATION AGENT" means KeyBank National Association, in
         its capacity as Documentation Agent.

                  "DOLLAR EQUIVALENT" means, on any date of determination, with
         respect to any amount in any Alternate Currency, the equivalent in
         Dollars of such amount, determined by the Administrative Agent pursuant
         to Section 1.5.

                  "DOLLARS", "U.S. DOLLARS" and the sign "$" each means lawful
         money of the United States.

                  "DOMESTIC BORROWERS" means International and each US
         Subsidiary and that is or becomes a Borrower hereunder.

                  "DOMESTIC LENDING OFFICE" means, with respect to any Bank, the
         office of such Bank specified as its "Domestic Lending Office" on the
         signature pages hereto, or such other office of such Bank as such Bank
         may from time to time specify to the Borrower and the Administrative
         Agent in writing.

                  "EMPLOYEE BENEFIT PLAN" means: (i) an "employee benefit plan"
         as defined in Section 3(3) of ERISA maintained by a Borrower or any of
         its ERISA Affiliates and (ii) any Multiemployer Plan which covers any
         employees of the Borrower or any of its ERISA Affiliates.

                  "ENVIRONMENTAL CLAIMS" means any and all administrative,
         regulatory or judicial actions, suits, demands, demand letters, claims,
         complaints, liens, notices of non-compliance, investigations,
         proceedings, consent orders or consent agreements relating in

                                       9

<PAGE>

         any way to any Environmental Law or any Environmental Permit,
         instituted by any Person, including, without limitation, (a) by
         governmental or regulatory authorities for enforcement, cleanup,
         removal, response, remedial or other actions or damages pursuant to any
         applicable Environmental Law or (b) by any third party seeking damages,
         contribution, indemnification, cost recovery, compensation or
         injunctive relief resulting from Hazardous Materials or arising from
         alleged injury or threat of injury to health or the environment.

                  "ENVIRONMENTAL LAWS" means any federal, state or local law,
         regulation, ordinance, or order pertaining to the protection of the
         environment and the health and safety of the public, including (but not
         limited to) the Comprehensive Environmental Response, Compensation and
         Liability Act ("CERCLA"), 42 USC Sections 9601 et seq.; the Resource
         Conservation and Recovery Act ("RCRA"), 42 USC Sections 6901 et seq.;
         the Hazardous Materials Transportation Act, 49 USC Sections 1801 et
         seq.; the Federal Water Pollution Control Act (33 USC Sections 1251 et
         seq.), the Toxic Substances Control Act (15 USC Sections 2601 et seq.)
         and the Occupational Safety and Health Act (29 USC Sections 651 et
         seq.), and all similar state, regional or local laws, treaties,
         regulations, statutes or ordinances, common law, civil laws, or any
         case precedents, rulings, requirements, directives or requests having
         the force of law of any foreign or domestic governmental authority,
         agency or tribunal, and all foreign equivalents thereof, as the same
         have been or hereafter may be amended, and any and all analogous future
         laws, treaties, regulations, statutes or ordinances, common law, civil
         laws, or any case precedents, rulings, requirements, directives or
         requests having the force of law of any foreign or domestic
         governmental authority, agency or tribunal and the regulations
         promulgated pursuant thereto, which governs: (i) the existence, cleanup
         and/or remedy of contamination on property; (ii) the emission or
         discharge of Hazardous Materials into the environment; (iii) the
         control of hazardous wastes; (iv) the use, generation, transport,
         treatment, storage, disposal, removal or recovery of Hazardous
         Materials; or (v) the maintenance and development of wetlands.

                  "EQUIPMENT" means and includes "equipment" as defined in the
         UCC.

                  "ERICO GLOBAL" means ERICO Global Company, a Delaware
         corporation.

                  "ERICO PRODUCTS" means ERICO Products, Inc., an Ohio
         corporation.

                  "ERICO PRODUCTS DEFINED BENEFIT PLAN" means the ERICO
         Products, Inc. Pension Plan and Trust.

                  "ERISA" means the Employee Retirement Income Security Act of
         1974 (Public Law 93-406), as amended, and in the event of any amendment
         affecting any Section thereof referred to in this Agreement, that
         reference shall be reference to that Section as amended, supplemented,
         replaced or otherwise modified.

                  "ERISA AFFILIATE" of any Person means any other Person that
         for purposes of Title IV of ERISA is a member of such Person's
         controlled group, or under common control with such Person, within the
         meaning of Section 414 of the Code.

                  "ERISA REGULATOR" means any governmental agency (such as the
         Department of Labor, the Internal Revenue Service and the Pension
         Benefit Guaranty Corporation) having any regulatory authority over any
         Employee Benefit Plan.

                                       10

<PAGE>

                  "EUROCURRENCY LIABILITIES" has the meaning assigned to that
         term in Regulation D of the Board of Governors of the Federal Reserve
         System, as in effect from time to time.

                  "EURO" means the lawful currency of the member states of the
         European Union that adopt the single currency in accordance with the
         Treaty establishing the European Community, as amended by the Treaty on
         European Union.

                  "EUROCURRENCY RESERVE PERCENTAGE" means, for any Interest
         Period in respect of any LIBOR Advance, as of any date of
         determination, the aggregate of the then stated maximum reserve
         percentages (including any marginal, special, emergency or supplemental
         reserves), expressed as a decimal, applicable to such Interest Period
         (if more than one such percentage is applicable, the daily average of
         such percentages for those days in such Interest Period during which
         any such percentage shall be so applicable) by the Board of Governors
         of the Federal Reserve System, any successor thereto, or any other
         banking authority, domestic or foreign, to which the Administrative
         Agent or any Bank may be subject in respect to eurocurrency funding
         (currently referred to as "Eurocurrency Liabilities" in Regulation D of
         the Federal Reserve Board) or in respect of any other category of
         liabilities including deposits by reference to which the interest rate
         on LIBOR Advances is determined or any category of extension of credit
         or other assets that include the LIBOR Advances. For purposes hereof,
         such reserve requirements shall include, without limitation, those
         imposed under Regulation D of the Federal Reserve Board and the LIBOR
         Advances shall be deemed to constitute Eurocurrency Liabilities subject
         to such reserve requirements without benefit of credits for proration,
         exceptions or offsets which may be available from time to time to any
         Bank under said Regulation D.

                  "EUROPA" means ERICO Europa B.V.

                  "EVENT OF DEFAULT" has the meaning specified in Section 7 of
         this Agreement.

                  "EXCHANGE RATE" means, with respect to any Alternate Currency
         on a particular date, the rate at which such Alternate Currency may be
         exchanged into Dollars, as set forth on such date on the relevant
         Reuters currency page at or about 11:00 a.m. London time, on such date.
         In the event that such rate does not appear on any Reuters currency
         page, the "Exchange Rate" with respect to such Alternate Currency shall
         be determined by reference to such other publicly available service for
         exchange rates as may be agreed upon by the Administrative Agent and
         International or, in the absence of such agreement, such "Exchange
         Rate" shall instead be the Administrative Agent's spot rate of exchange
         in the market which its foreign currency exchange operations are then
         being conducted, at or about 10:00 A.M., local time, on such date for
         the purchase of Dollars with such Alternate Currency, for delivery two
         (2) Business Days later; provided, that if at the time of any such
         determination, no such spot rate can be reasonably quoted, the
         Administrative Agent may use any reasonable method as it deems
         applicable to determine such rate, and such determination shall be
         conclusive absent manifest error.

                  "EXISTING LETTERS OF CREDIT" means all Letters of Credit
         issued by National City Bank listed on Annex VII which remain
         outstanding on the Restatement Date and which will continue in effect
         after the Restatement Date.

                  "EXTRAORDINARY" means extraordinary and other non-recurring
         losses and charges or gains as determined on a consolidated basis in
         accordance with GAAP.

                  "FACILITY FEE" has the meaning set forth in Section 2.12(f) of
         this Agreement.

                                       11

<PAGE>

                  "FACILITY FEE PERCENTAGE" means: (i) for the period commencing
         on the Restatement Date and ending on May 31, 2003, a percentage equal
         to one half of one percent (.50%) per annum and (ii) thereafter, such
         percentage or, to the extent a financial standard set forth in the
         table in Section 2.12(g) is satisfied, such percentage as adjusted
         pursuant to Section 2.12(g) of this Agreement.

                  "FAIR MARKET VALUE" means the amount that would be obtained in
         an arm's-length transaction between an informed and willing buyer and
         an informed and willing seller, neither under compulsion to buy or
         sell.

                  "FEDERAL FUNDS RATE" means, for any day, the rate per annum
         (rounded upwards, if necessary, to the nearest one hundredth of one
         percent (1/100th of 1%) equal to the weighted average of the rates on
         overnight Federal funds transactions with members of the Federal
         Reserve System arranged by Federal funds brokers on such day, as
         published by the Federal Reserve Bank of New York on the Business Day
         next succeeding such day, provided that: (a) if the day for which such
         rate is to be determined is not a Business Day, the Federal Funds Rate
         for such day shall be such a rate on such transactions on the
         immediately preceding Business Day as so published on the next
         succeeding Business Day and (b) if such rate is not so published for
         any Business Day, the Federal Funds Rate for such Business Day shall be
         the average of quotations for such day on such transactions received by
         LaSalle from three Federal funds brokers of recognized standing
         selected by LaSalle as determined by LaSalle and reported to the
         Administrative Agent.

                  "FEE PERCENTAGE ADJUSTMENT DATE" has the meaning specified in
         Section 2.12(g) of this Agreement.

                  "FINANCIAL ASSET" means and includes "financial asset" as
         defined in the UCC.

                  "FINANCIAL IMPAIRMENT" means, in respect of a Person, the
         distressed economic condition of such Person manifested by any one or
         more of the following events:

                           (a)      the discontinuation of the business of the
                  Person;

                           (b)      the adjudication of the Person as a debtor
                  or having an order for relief under Title 11 of the United
                  States Code entered against the Person;

                           (c)      the Person ceases or is unable or admits in
                  writing its inability, to make timely payment upon the
                  Person's debts, obligations, or liabilities as they mature or
                  come due;

                           (d)      any assignment by the Person for the benefit
                  of creditors;

                           (e)      either: (i) the voluntary institution by
                  such Person of or (ii) the consent granted by such Person to
                  the involuntary institution (whether by petition, complaint,
                  application, default, answer (including, without limitation,
                  an answer or any other permissible or required responsive
                  pleading admitting: (A) the subject matter jurisdiction of the
                  forum or (B) any material allegations of the petition,
                  complaint, application, or other writing to which such answer
                  serves as a responsive pleading thereto), or otherwise) of any
                  bankruptcy, insolvency, reorganization, arrangement,
                  readjustment of debt, dissolution, liquidation, receivership,
                  trusteeship, or similar proceeding pursuant to or purporting
                  to be pursuant to any bankruptcy, insolvency, reorganization,
                  arrangement, readjustment of debt, dissolution, liquidation,
                  receivership, trusteeship, or similar law of any jurisdiction;

                                       12

<PAGE>

                           (f)      the voluntary application by the Person for
                  or consent granted by the Person to the involuntary
                  appointment of any receiver, trustee, or similar officer (i)
                  for the Person or (ii) of or for all or any substantial part
                  of the Person's property; or

                           (g)      the entry, without the Person's application,
                  approval, or consent, of any order that is not dismissed,
                  stayed, or discharged within ninety (90) days from its entry,
                  which is pursuant to or purporting to be pursuant to any
                  bankruptcy, insolvency, reorganization, arrangement,
                  readjustment of debt, dissolution, liquidation, receivership,
                  trusteeship or similar law of any jurisdiction: (i) approving
                  an involuntary petition seeking an arrangement of the Person's
                  creditors, (ii) approving an involuntary petition seeking
                  reorganization of the Person, or (iii) appointing any
                  receiver, trustee, or similar officer (A) for the Person or
                  (B) of or for all or any substantial part of the Person's
                  property.

                  "FINANCIAL STANDARD I" means satisfaction by International and
         its Subsidiaries on a consolidated basis of a Consolidated Funded Debt
         to EBITDA Ratio (as measured for the Cumulative Four Quarter Period
         ending as of the applicable Determination Date) of less than or equal
         to 1.75 to 1.00.

                  "FINANCIAL STANDARD II" means satisfaction by International
         and its Subsidiaries on a consolidated basis of a Consolidated Funded
         Debt to EBITDA Ratio (as measured for the Cumulative Four Quarter
         Period ending as of the applicable Determination Date) of greater than
         1.75 to 1.00 but less than or equal to 2.25 to 1.00.

                  "FINANCIAL STANDARD III" means satisfaction by International
         and its Subsidiaries on a consolidated basis of a Consolidated Funded
         Debt to EBITDA Ratio (as measured for the Cumulative Four Quarter
         Period ending as of the applicable Determination Date) of greater than
         2.25 to 1.00 but less than or equal to 3.25 to 1.00.

                  "FINANCIAL STANDARD IV" means satisfaction by International
         and its Subsidiaries on a consolidated basis of a Consolidated Funded
         Debt to EBITDA Ratio (as measured for the Cumulative Four Quarter
         Period ending as of the applicable Determination Date) of greater than
         3.25 to 1.00 but less than or equal to 3.75 to 1.00.

                  "FINANCIAL STANDARD V" means satisfaction by International and
         its Subsidiaries on a consolidated basis of a Consolidated Funded Debt
         to EBITDA Ratio (as measured for the Cumulative Four Quarter Period
         ending as of the applicable Determination Date) of greater than 3.75 to
         1.00 but less than or equal to 4.25 to 1.00.

                  "FINANCIAL STANDARD VI" means satisfaction by International
         and its Subsidiaries on a consolidated basis of a Consolidated Funded
         Debt to EBITDA Ratio (as measured for the Cumulative Four Quarter
         Period ending as of the applicable Determination Date) of greater than
         4.25 to 1.00.

                  "FISCAL 2002 NET WORTH AMOUNT" has the meaning set forth in
         Section 6.4(a) of this Agreement.

                  "FISCAL MONTH" means any of the monthly fiscal periods
         collectively forming a Fiscal Year of International.

                  "FISCAL QUARTER" means any of the four consecutive three-month
         fiscal accounting periods of International and ending on March 31, June
         30, September 30 and December 31 of each calendar year.

                                       13

<PAGE>

                  "FISCAL YEAR" means International's regular annual accounting
         period for federal income tax purposes ending on December 31 of each
         calendar year.

                  "FIXTURE" means and includes a "fixture" as defined in the
         UCC.

                  "FOREIGN BORROWER" means each Non-US Subsidiary of
         International that is also a Borrower.

                  "FRONTING BANK" means LaSalle Bank National Association in its
         capacity as an issuer of Letters of Credit and solely with respect to
         Existing Letters of Credit, National City Bank shall be deemed to be a
         "Fronting Bank" hereunder.

                  "FRONTING BANK LC" means a Letter of Credit issued by the
         Fronting Bank for the account of International or ERICO Products or an
         Existing Letter of Credit Issued by National City Bank issued for the
         account of International or ERICO Products.

                  "FRONTING BANK LC EXPOSURE" means, at any time of
         determination, the sum of: (a) the aggregate undrawn amount of all
         Fronting Bank LCs (including Existing Letters of Credit), outstanding
         at such time and (b) the aggregate amount that has been drawn under
         such Fronting Bank LCs (including Existing Letters of Credit) as to
         which the Fronting Bank has not at such time been reimbursed by
         International or ERICO Products.

                  "GAAP" means generally accepted accounting principles
         consistent with those applied in the preparation of the financial
         statements referred to in Section 6.1 of this Agreement and otherwise
         consistently applied.

                  "GENERAL INTANGIBLE" means "general intangible" as defined in
         the UCC.

                  "GOODS" means and includes "goods" as defined in the UCC.

                  "GUARANTEED OBLIGATIONS" has the meaning specified in Section
         13.4(b) of this Agreement.

                  "GUARANTOR" means a Person who pledges his credit or property
         in any manner for the payment or other performance of Indebtedness,
         agreements or other obligation of another Person including, without
         limitation, any guarantor (whether of collection or payment), any
         obligor in respect of a standby letter of credit or surety bond issued
         for the account of another Person, any surety, any co-maker, any
         endorser, and any Person who agrees conditionally or otherwise to make
         any loan, purchase or investment in order to enable another Person to
         prevent or correct a default of any kind or otherwise to assure a
         creditor against loss in respect of such Indebtedness, agreements or
         obligations.

                  "GUARANTY" means the obligations undertaken by a Guarantor.

                  "GUARANTY AGREEMENT" means the Guaranty Agreement-US
         Subsidiaries described on Annex III, as amended from time to time, in
         substantially the form attached hereto as Exhibit E and by reference
         made a part hereof.

                  "HAZARDOUS MATERIAL" means and includes: (a) any asbestos or
         other material composed of or containing asbestos which is, or may
         become, even if properly managed, friable, (b) petroleum and any
         petroleum product, including crude oil or any fraction thereof, and
         natural gas or synthetic natural gas liquids or mixtures thereof; (c)
         any hazardous, toxic or dangerous waste, substance or material defined
         as such in (or for purposes of) CERCLA or RCRA, any so-called
         "Superfund" or "Superlien" law, or any

                                       14

<PAGE>

         other applicable Environmental Laws, and (d) any other substance whose
         generation, handling, transportation, treatment or disposal is
         regulated pursuant to any Environmental Laws.

                  "HOLDING" means ERICO Holding Company, an Ohio corporation.

                  "HOLDING SENIOR SUBORDINATED INDENTURE" means that certain
         Indenture, dated as of December 2, 2002, by and among Holding, CVC, and
         other parties thereto, as the same may be amended, restated or
         supplemented.

                  "HOLDING SENIOR SUBORDINATED NOTES" means those certain
         $35,000,000 11% Senior Subordinated Notes due 2012 issued pursuant to
         the Holding Senior Subordinated Indenture on the Restatement Date.

                  "HOLDING SENIOR SUBORDINATED INDEBTEDNESS" means the
         Subordinated Indebtedness under or in respect of the Holding Senior
         Subordinated Notes and the Holding Senior Subordinated Indenture, in
         the original principal amount of $35,000,000.

                  "INDEBTEDNESS" means, with respect to any Person, without
         duplication, (a) indebtedness for borrowed money, (b) obligations of
         such Person evidenced by bonds, debentures, notes or other similar
         instruments, (c) obligations of such Person for the deferred purchase
         price of property or services, (d) obligations of such Person as lessee
         under leases which shall have been or should be, in accordance with
         GAAP, recorded as capital leases, (e) all obligations of such Person as
         an account party in respect of letters of credit or banker's
         acceptances, (f) liabilities of such Person in respect of unfunded
         vested benefits under plans covered by Title IV of ERISA, (g)
         obligations of a third party secured by any Lien on the properties or
         assets of such Person, (h) obligations of such Person in respect of
         currency forward or interest rate swap or interest rate cap or
         comparable transactions and (i) obligations under any direct or
         indirect Guaranty in respect of indebtedness or obligations of a third
         party of the kinds referred to in clauses (a) through (h) above.

                  "INSTRUMENTS" means "instruments" as defined by the UCC.

                  "INTELLECTUAL PROPERTY" means all Software and all inventions,
         all designs, all patents, all applications therefor, all trademarks,
         service marks, and trade names, all registrations and applications
         therefor, all copyrights, all registrations therefor, and any licenses
         thereof, in each case, whether now existing or hereafter arising or
         acquired.

                  "INTEREST PERIOD" means, for each LIBOR Advance comprising a
         Borrowing, the period commencing on the funding date of such LIBOR
         Advance or the date of the Rate Conversion or Rate Continuation of any
         Advances into such LIBOR Advance and ending on the numerically
         corresponding day of the period selected by a Borrower pursuant to the
         provisions hereof and each subsequent period commencing on the last day
         of the immediately preceding Interest Period in respect of such LIBOR
         Advance and ending on the last day selected for such period by such
         Borrower pursuant to the provisions hereof; provided, however, that the
         duration of each such Interest Period shall be one, two, three or six
         months, in each case as such Borrower may select by delivery to the
         Administrative Agent of a Credit Request therefor in accordance with
         Section 2.2(a) of this Agreement and; provided, further, that:

                           (i)      the Interest Period for each LIBOR Advance
                                    comprising part of the same Borrowing shall
                                    be of the same duration;

                                       15

<PAGE>

                           (ii)     whenever the last day of any Interest Period
                                    would otherwise occur on a day other than a
                                    Business Day, the last day of such Interest
                                    Period shall be extended to occur on the
                                    next succeeding Business Day; provided,
                                    however, that, if such extension would cause
                                    the last day of such Interest Period to
                                    occur in the next following calendar month,
                                    the last day of such Interest Period shall
                                    occur on the immediately preceding Business
                                    Day;

                           (iii)    if the Interest Period commences on a
                                    Business Day for which there is no numerical
                                    equivalent in the calendar month in which
                                    the Interest Period is to end, such Interest
                                    Period shall end on the last Business Day of
                                    that calendar month;

                           (iv)     with respect to LIBOR Advances comprising
                                    any Revolving Credit Borrowing, no Interest
                                    Period may end on a date later than the
                                    Termination Date; and

                           (v)      with respect to LIBOR Advances comprising
                                    any outstanding Term Borrowing, no Interest
                                    Period may end on a date later than any Term
                                    Advance Repayment Date unless, after giving
                                    effect to such selection, the aggregate
                                    unpaid principal amount of the Alternate
                                    Base Rate Loans comprising Term Borrowings,
                                    together with the aggregate unpaid principal
                                    amount of LIBOR Advances comprising Term
                                    Borrowings which have an Interest Period
                                    ending on or prior to such Term Advance
                                    Repayment Date, shall be at least equal to
                                    that portion of the aggregate principal
                                    amount of such Term Borrowing due and
                                    payable on and prior to such Repayment Date.

                  "INTERNATIONAL" means ERICO International Corporation, an Ohio
         corporation.

                  "INVENTORY" means and includes "inventory" as defined in the
         UCC.

                  "INVESTMENT PROPERTY" means and includes "investment property"
         as defined in the UCC.

                  "ISSUING BANK" means the Fronting Bank or the Affiliate
         Fronting Bank, as the case may be.

                  "JUDGMENT CURRENCY" has the meaning specified in Section
         13.4(b) of this Agreement.

                  "LASALLE" means LaSalle Bank National Association, a national
         banking association.

                  "LAW" means any law, treaty, regulation, statute or ordinance,
         common law, civil law, or any case precedent, ruling, requirement,
         directive or request having the force of law of any foreign or domestic
         governmental authority, agency or tribunal.

                  "LC EXPOSURE" means, at any time of determination, in respect
         of a Borrower, the sum of the Fronting Bank LC Exposure and the
         Affiliate Fronting Bank LC Exposure.

                  "LEAD ARRANGER" has the meaning set forth in Section 10.2 of
         this Agreement.

                                       16

<PAGE>

                  "LENDING INSTALLATION" means, with respect to a Bank, the
         branch, Subsidiary or Affiliate of such Bank specified under the name
         of such Bank on the signature pages hereto or as otherwise selected by
         such Bank pursuant to Section 2.5(b) of this Agreement, or such other
         branch, Subsidiary or Affiliate as such Bank may from time to time
         specify in writing to the Borrowers, the Administrative Agent and the
         Banks as its Lending Installation.

                  "LENDING OFFICE" means, with respect to any Bank, its Domestic
         Lending Office or its Alternate Currency Lending Office, as the case
         may be.

                  "LETTER OF CREDIT" means any Trade Letter of Credit or Standby
         Letter of Credit.

                  "LETTER OF CREDIT COLLATERAL ACCOUNT" has the meaning
         specified in Section 8.9 of this Agreement.

                  "LETTER OF CREDIT FACILITY APPLICATION" has the meaning
         specified in Section 2.11(a) of this Agreement.

                  "LETTER OF CREDIT FEE PERCENTAGE" means: (i) for the period
         commencing on the Restatement Date and ending on May 31, 2003, a
         percentage equal to three and one quarter percent (3.250%) per annum
         and (ii) thereafter, such percentage or, to the extent a financial
         standard set forth in the table in Section 2.12(d) is satisfied, such
         percentage as adjusted pursuant to Section 2.12(d)of this Agreement.

                  "LETTER-OF-CREDIT RIGHT" means and includes a
         "letter-of-credit right" as defined in the UCC.

                  "LIBOR" means, for any Interest Period with respect to a LIBOR
         Borrowing, the quotient of: (x) the per annum rate of interest,
         determined by the Administrative Agent in accordance with its usual
         procedures (which determination shall be conclusive absent manifest
         error) as of approximately 11:00 a.m. (London time) two Business Days
         prior to the beginning of such Interest Period pertaining to such LIBOR
         Advance, as displayed in the Bloomberg Financial Markets System (or any
         successor or substitute page of such Service, or any successor to or
         substitute for such Service providing rate quotations comparable to
         those currently provided on such page of such Service, as determined by
         the Administrative Agent from time to time for purposes of providing
         quotations of interest rates applicable to deposits in dollars or in
         the applicable Alternate Currency in the London interbank market) as
         the rate in the London interbank market for deposits in Dollars or in
         the applicable Alternate Currency in immediately available funds with a
         maturity comparable to such Interest Period divided by (y) a number
         equal to 1.00 minus the Eurocurrency Reserve Percentage. In the event
         that such rate quotation is not available for any reason, then the rate
         (for purposes of clause (x) hereof) shall be the rate, determined by
         the Administrative Agent as of approximately 11:00 a.m. (London time)
         two Business Days prior to the beginning of such Interest Period
         pertaining to such LIBOR Advance, to be the average of the per annum
         rates at which Dollar deposits in immediately available funds in an
         amount comparable to LaSalle's Ratable Portion of such LIBOR Borrowing
         and with a maturity comparable to such Interest Period are offered to
         the prime banks by leading banks in the London interbank market. The
         LIBOR shall be adjusted automatically on and as of the effective date
         of any change in the Eurocurrency Reserve Percentage.

                  "LIBOR ADVANCE" means an Advance bearing interest by reference
         to the LIBOR whether denominated in Dollars or in an Alternate
         Currency.

                                       17

<PAGE>

                  "LIBOR BORROWING" means a Borrowing consisting of LIBOR
         Advances.

                  "LIEN" means any lien, security interest or other charge or
         encumbrance of any kind, or any other type of preferential arrangement,
         including, without limitation, the lien or retained security title of a
         conditional vendor and any easement, right of way or other encumbrance
         on title to real property.

                  "LIQUID INVESTMENTS" means (i) certificates of deposit
         maturing within ninety (90) days of the acquisition thereof denominated
         in Dollars and issued by (a) a Bank, (b) a bank, trust company or other
         financial institution having combined capital and surplus of at least
         $500,000,000 and which has (or which is a Subsidiary of a financial
         institution which has) publicly traded debt securities rate A- or
         higher by Standard & Poor's Corporation or A-3 or higher by Moody's
         Investors Service, Inc., (ii) obligations issued or guaranteed by the
         United States, with maturities not more than one (1) year after the
         date of issue; and (iii) commercial paper with maturities of not more
         than ninety (90) days and a published rating of not less that A-1 from
         Standard & Poor's Corporation or P-1 from Moody's Investors Service,
         Inc.

                  "LOAN ACCOUNT" has the meaning specified in Section 2.1(c) of
         this Agreement.

                  "LOAN DOCUMENTS" means any note, security agreement, Guaranty
         or other lien instrument, reimbursement agreement, financial statement,
         audit report, environmental audit, notice, request of advance, any
         letter of credit, interest rate swap or hedge agreement, officer's
         certificate or other writing of any kind which is now or hereafter
         required to be delivered by or on behalf of a Borrower to the
         Administrative Agent or the Banks under this Agreement and includes,
         without limitation, the Revolving Credit Notes, the Term Notes and the
         other writings referred to in Section 2 and Section 3 of this
         Agreement.

                  "LOAN PARTIES" means, collectively, each of the Banks, the
         Issuing Bank, and the Administrative Agent, each in its respective
         capacity.

                  "MARGIN ADJUSTMENT DATE" has the meaning specified in Section
         2.13(b) and 2.13(d) of this Agreement.

                  "MARGIN DETERMINATION DATE" has the meaning specified in
         Sections 2.13(b) and 2.13(d) of this Agreement.

                  "MASTER LETTER OF CREDIT AGREEMENT" means that certain Master
         Letter of Credit Agreement, in the form of Exhibit D, executed by each
         Borrower hereunder.

                  "MATERIAL ADVERSE EFFECT" means, as to any event, occurrence
         or condition, if (i) the result thereof would, either singly or in the
         aggregate, have a material adverse effect on: (a) the business,
         operations, profitability or condition (financial or otherwise) of
         International and its Subsidiaries, taken as a whole or (b) any
         Borrower's ability to repay the Obligations or (ii) without limiting
         the generality of the foregoing, the result thereof could reasonably be
         expected to, singly, cause a loss, liability or damage in an amount
         equal to or greater than ten percent (10%) of the Consolidated Net
         Worth at the time of such event or, in the aggregate, when taken
         together with any and all other losses, liabilities, or damages as to
         which this definition of Material Adverse Effect applies, cause a loss,
         liability or damage in an amount equal to or greater than twenty
         percent (25%) of the Consolidated Net Worth at such time.

                                       18

<PAGE>

                  "MATERIAL RECOVERY EVENT" means (a) any casualty loss in
         respect of asset of a Borrower covered by casualty insurance and (b)
         any compulsory transfer or taking under threat of compulsory transfer
         of any asset of a Borrower or any Subsidiaries thereof by any agency,
         department, authority, commission, board, instrumentality or political
         subdivision of the United States, any state or municipal government.

                  "MERGER AGREEMENT" shall mean that certain Agreement and Plan
         of Merger, dated July 31, 2002, as amended, by and among ERICO Global
         Company, EHC Acquisition Corp. and Holding.

                  "MERGER DOCUMENTS" shall mean all other documents related to
         the Merger Agreement as requested by the Administrative Agent,
         including legal opinions delivered in connection with the Merger and
         the filed certificate of merger.

                  "MULTIEMPLOYER PLAN" means any Employee Benefit Plan which is
         a "multiemployer plan" as such term is defined in Section 4001(a)(3) of
         ERISA.

                  "NET PROCEEDS" means (a) the cash proceeds (including cash
         proceeds subsequently received in respect of non-cash consideration
         initially received) from any sale, transfer or other disposition of
         assets of a Borrower to a Person (other than: (i) any sale of Inventory
         in the ordinary course, (ii) disposition in the ordinary course of such
         Borrower's business of assets that are obsolete, worn out or no longer
         used or useful in such Borrower's business, (iii) disposition of
         capital assets the proceeds of which (net of taxes payable with respect
         to the disposition and the reasonable costs and expenses of sale) are
         reinvested within One Hundred Eighty (180) days in capital assets of
         like kind of such Borrower or (iv) any sale, transfer or other
         disposition of assets of a Borrower to any other Borrower) to the
         extent that such proceeds (net of (x) selling expenses, including
         without limitation any reasonable broker's fees or commissions, costs
         of discontinuing operations associated with such assets and sales,
         transfer and similar taxes and (y) the repayment of any Indebtedness
         secured by a purchase money Lien on such assets that is permitted under
         this Agreement) exceeds Three Million Dollars ($3,000,000) in any
         calendar year and only to the extent of such excess; (b) other than
         indebtedness permitted to be incurred pursuant to Section 6.3(b), the
         cash proceeds from the issuance and/or sale of equity or debt
         securities of any Borrower pursuant to any public offering or private
         placement, net of transaction costs (net of customary fees, costs and
         expenses including, without limitation, underwriters' or placement
         agents' discounts and commissions and transfer and similar taxes), (c)
         the cash proceeds from any additional Indebtedness, other than
         indebtedness permitted to be incurred pursuant to Section 6.3(b),
         permitted hereunder to the extent such proceeds, when aggregated for
         the purposes of this clause (c) with the debt securities referred to in
         clause (b) hereof, exceed One Hundred Thousand Dollars ($100,000) and
         only to the extent of such excess, and (d) the cash proceeds from any
         Material Recovery Event (net of any amounts in respect of insurance
         proceeds or proceeds of compulsory takings which are reinvested in
         repair or replacement of the capital assets which were subject to such
         casualty or taking).

                  "NON-US SUBSIDIARY" means a Subsidiary of International which
         is not a US Subsidiary.

                  "NOTES" means, collectively, (a) each of the Revolving Credit
         Notes executed and delivered by the Borrowers in favor of each of the
         Banks under this Agreement and (b) each of the Term Notes executed and
         delivered by the Borrowers in favor of each of the Banks under this
         Agreement.

                  "OBLIGATED BANK" has the meaning specified in Section 2.5 of
         this Agreement.

                                       19

<PAGE>

                  "OBLIGATIONS" means the obligations of each Borrower and\or
         its Subsidiaries under this Agreement including, without limitation,
         the outstanding principal and accrued interest (including interest
         accruing on or after a petition for relief under the federal bankruptcy
         laws has been filed whether or not such claim for post-petition
         interest is allowed in such proceeding) in respect of any Revolving
         Credit Advances, the Term Advances, the LC Exposure, fees owing to the
         Banks or the Administrative Agent in respect of Letters of Credit and
         other fees owing to the Administrative Agent or the Banks under this
         Agreement or any Loan Document, and any amounts owing by each Borrower
         to the Administrative Agent pursuant to such Borrower's obligation to
         guarantee the Obligations of the other Borrowers as provided in Section
         9 of this Agreement; the Related Expenses; any expenses, taxes, Other
         Taxes, compensation, indemnification obligations or other amounts owing
         by such Borrower to the Administrative Agent or any Bank under this
         Agreement or any Loan Document; any amounts owing to the Administrative
         Agent under any reimbursement agreement; and the amounts owing to any
         of the Banks by such Borrower and\or its Subsidiaries under any
         currency forward agreement, interest rate swap agreement or similar
         interest rate hedge or similar agreement in connection with Advances
         under this Agreement.

                  "OPERATING ACCOUNT" means an account maintained by and in the
         name of a International (i) on the Restatement Date at National City
         Bank and (ii) within ninety (90) days from the Restatement Date at
         LaSalle Bank National Association, as Administrative Agent for the
         Banks, for the purposes of disbursing the proceeds of Revolving Credit
         Advances and Term Advances denominated in Dollars, which account shall
         in no case be a payroll account.

                  "ORIGINAL CREDIT AGREEMENT" means that certain Amended and
         Restated Credit and Security Agreement, dated as of May 2, 2002, as
         further described in Section 1.1 of this Agreement.

                  "OTHER TAXES" has the meaning specified in Section 12.3 of
         this Agreement.

                  "PAYMENT OFFICE" means such office of the Administrative Agent
         as set forth on the signature page of the Administrative Agent or such
         offices as may be from time to time selected by the Administrative
         Agent and notified in writing by the Administrative Agent to the
         Borrower and the Banks as the office to which payments are to be made
         to the Administrative Agent by the Borrower or the Banks, as the case
         may be.

                  "PBGC" means the Pension Benefit Guaranty Corporation or any
         other governmental authority succeeding to any of its functions.

                  "PERMITTED ACQUISITION" means an acquisition by a Borrower or
         any of its Subsidiaries of all or any portion of the assets or stock of
         another Person or any merger or consolidation with another Person other
         than a merger or consolidation to which a Borrower is a party and which
         is made subject to the following conditions: (i) prior to the
         consummation of such transaction, International shall have delivered to
         the Banks pro forma financial statements reflecting the effect of such
         transaction and establishing that after the consummation of the
         transaction the Borrowers shall be in compliance with the terms of
         Section 6.4 of this Agreement, (ii) prior to the consummation of such
         transaction International shall have delivered to the Banks the
         Acquisition Agreement with respect to such transaction, (iii) no Event
         of Default shall have occurred or shall occur upon the consummation of
         the transaction (iv) in the event that the aggregate purchase price of
         such transaction is more than Twelve Million Five Hundred Thousand
         Dollars ($12,500,000) (x) the Banks shall have given their prior
         written consent to the transaction and (y) the Person being acquired or
         merged or consolidated with shall be in the same or

                                       20

<PAGE>

         similar industries as any of the Borrowers and (v) in the event that
         the purchase price of all transactions which have not been otherwise
         consented to by the Banks prior to the Revolving Credit Termination
         Date has or will exceed Thirty-Five Million Dollars ($35,000,000) in
         the aggregate, the Banks shall have given their prior written consent
         to all additional transactions.

                  "PERSON" means an individual, partnership, corporation
         (including a business trust), joint stock company, trust,
         unincorporated association, joint venture or other entity, or a
         government or any political subdivision or agency thereof.

                  "PLEDGE AGREEMENT" means an agreement in the form of either
         Exhibit F-1, Exhibit F-2, or Exhibit F-3 hereof.

                  "PLEDGE AGREEMENT-EUROPA" means the Pledge and Security
         Agreement-Europa described on Annex III, as amended from time to time,
         in substantially the form attached hereto as Exhibit F-3 and by
         reference made a part hereof.

                  "PLEDGE AGREEMENT-INTERNATIONAL" means the Pledge and Security
         Agreement-International described on Annex III, as amended from time to
         time, in substantially the form attached hereto as Exhibit F-1 and by
         reference made a part hereof.

                  "PLEDGE AGREEMENT-PRODUCTS" means the Pledge and Security
         Agreement- Products described on Annex III, as amended from time to
         time, in substantially the form attached hereto as Exhibit F-2 and by
         reference made a part hereof.

                  "PLEDGING BORROWER" means International and each other
         Borrower which is a US Subsidiary which is pledging its assets as
         security for the Obligations pursuant to Section 4.1 of this Agreement.

                  "POTENTIAL DEFAULT" means an event, condition or thing which
         with the lapse of any applicable grace period or with the giving of
         notice or both would constitute, an Event of Default referred to in
         Section 7 of this Agreement and which has not been appropriately waived
         in writing in accordance with this Agreement or fully corrected, prior
         to becoming an actual Event of Default.

                  "PROCEEDS" means all "proceeds" (as defined in the UCC), of
         any and all of the Collateral made or due and payable to the Borrower
         from time to time, including all proceeds in connection with any
         requisition, confiscation, condemnation, seizure or forfeiture of all
         or any part of the Collateral by any governmental body, authority,
         bureau or agency (or any Person acting under color of governmental
         authority) and, to the extent not otherwise included, all payments
         under insurance (whether or not the Administrative Agent is the loss
         payee thereof), or any indemnity, warranty or guaranty, payable by
         reason of loss or damage to or otherwise with respect to any of the
         Collateral.

                  "PRODUCTS" means property directly or indirectly resulting
         from any assembling or commingling of any Collateral.

                  "RATABLE BORROWER SHARE" means, with respect to any Borrower,
         such amount of the Obligations hereunder that represents a good faith
         allocation by the Borrowers of all general fees, charges and other
         Obligations hereunder not specifically attributable to or the
         responsibility of a particular Borrower (Advances and Letters of Credit
         made to or for the account of a Borrower and interest thereon being
         specific to the Borrower affected thereby ) to each Borrower so that no
         Foreign Borrower shall have or be construed as

                                       21

<PAGE>

         having liability or responsibility for any Obligations of any Domestic
         Borrower or any other Foreign Borrower.

                  "RATABLE PORTION" means, in respect of any Bank, the quotient
         (expressed as a percentage) obtained at any time by dividing: (i) such
         Bank's Revolving Credit Commitment at such time plus such Bank's
         outstanding Term Advances s at such time by (ii) the aggregate amount
         of the Revolving Credit Commitments of all of the Banks at such time
         plus the aggregate outstanding Term Advances of all of the Banks at
         such time.

                  "RATE CONTINUATION" means, in respect of LIBOR Advances having
         a particular Interest Period, a continuation of such LIBOR Advances
         pursuant to Section 2.10 of this Agreement as LIBOR Advances with an
         Interest Period of the same duration.

                  "RATE CONVERSION" means a conversion pursuant to Section 2.10
         of this Agreement of Advances of one Type into Advances of another Type
         and, with respect to LIBOR Advances, from one permissible Interest
         Period to another permissible Interest Period.

                  "RATE CONVERSION/CONTINUATION REQUEST" has the meaning
         specified in Section 2.10 of this Agreement.

                  "RCRA" means the Resource Conservation and Recovery Act, 42
         U.S.C. Sections 6901 et seq.

                  "RECAPITALIZATION" means the transaction contemplated by the
         Merger Agreement and the Merger Documents.

                  "REGULATORY CHANGE" means, as to any Bank, any change in
         United States federal, state or foreign Laws or regulations or the
         adoption or making of any interpretations, directives or requests of or
         under any United States federal, state or foreign Laws or regulations
         (whether or not having the force of Law) by any court or governmental
         authority charged with the interpretation or administration thereof.

                  "RELATED EXPENSES" means any and all reasonable costs,
         liabilities, and expenses (including without limitation, losses,
         damages, penalties, claims, actions, reasonable attorney's fees and
         legal expenses actually incurred on an hourly basis, judgments, suits,
         and disbursements) incurred by, imposed upon, or asserted against, the
         Administrative Agent or any Bank in connection with any attempt by the
         Administrative Agent or any Bank:

                           (a)      as provided for in this Agreement or any
                  Loan Document, to preserve, perfect, or enforce any security
                  interest evidenced by: (i) this Agreement, any Loan Document
                  or (ii) any other pledge agreement, mortgage deed,
                  hypothecation agreement, guaranty, security agreement,
                  assignment, or security instrument executed or given by a
                  Borrower or a Guarantor to or in favor of the Administrative
                  Agent for the benefit of the Banks,

                           (b)      as provided for in this Agreement, to obtain
                  payment, performance, and observance of any and all of the
                  Obligations,

                           (c)      as provided for in this Agreement, to
                  maintain, insure, collect, preserve, repossess, and dispose of
                  any of the Collateral or any collateral securing a Guaranty in
                  favor of the Administrative Agent for the benefit of the
                  Banks, or

                                       22

<PAGE>

                           (d)      reasonably incidental or related to (a)
                  through (c) above including, without limitation, interest
                  thereupon from the date incurred, imposed, or asserted until
                  paid at the rate payable as set forth in Section 2 of the
                  Agreement, but in no event greater than the highest rate
                  permitted by law; provided, however, that, so long as no Event
                  of Default has occurred, interest shall accrue commencing on
                  the fifth (5th) Business Day after the Borrowers have been
                  requested to pay any such Related Expenses.

                  "RELATED PARTY ADVANCES" means, at any date of determination,
         the outstanding balance of receivables reflected on the balance sheet
         of a Borrower owing from any Affiliate of a Borrower or its
         Subsidiaries.

                  "REMITTANCES" means all payments of every kind (other than
         Collections in respect of Accounts) to a Borrower or its Subsidiaries,
         including without limitation cash payments in respect of Inventory
         sales, payments in respect of other dispositions of Collateral (other
         than Inventory in the ordinary course of business) and real property of
         a Borrower or its Subsidiaries, insurance proceeds, condemnation awards
         and tax refunds.

                  "REPORTABLE EVENT" means any of the events set forth in
         Section 4043 of ERISA excluding those events for which the requirement
         of notice has been waived by the PBGC.

                  "REQUIRED BANKS" means, at any time, (a) Banks holding at
         least sixty-six and two thirds percent (66 2/3%) of (i) the Revolving
         Credit Commitments of all of the Banks at such time plus (ii) the
         outstanding Term Advances of all of the Banks at such time plus (iii)
         the aggregate LC Exposure of all of the Banks at such time, provided,
         however, that so long as there are more than three (3) Banks party to
         this Agreement, "Required Banks" shall never be less than three (3)
         Banks and provided further that "Required Banks" with respect to
         amendments or waivers of any provisions of Sections 6.4(a) and 6.4(e)
         shall never be less than Banks having less than seventy-five percent
         (75%) of (i) the Revolving Credit Commitments of all of the Banks at
         such time plus (ii) the outstanding Term Advances of all of the Banks
         at such time plus (iii) the aggregate LC Exposure of all of the Banks
         at such time.

                  "RESET DATE" has the meaning specified in Section 1.5 of this
         Agreement.

                  "RESPONSIBLE OFFICER" means, with respect to any Person, the
         President or Chief Financial Officer of such Person.

                  "RESTATEMENT DATE" means December 2, 2002.

                  "REVOLVING CREDIT ADVANCE" means an advance made by a Bank to
         a Borrower on a revolving credit basis pursuant to Section 2.1(a) of
         this Agreement in Dollars or in an Alternate Currency (whether an
         Advance made by a Bank pursuant to a Credit Request or an Advance made
         by a Bank by reason of a Deemed Credit Request pursuant to Section
         2.2(b) of this Agreement).

                  "REVOLVING CREDIT ALTERNATE BASE RATE ADVANCE" means an
         Advance denominated in Dollars which bears interest as provided in
         Section 2.13(a)(i) of this Agreement.

                  "REVOLVING CREDIT ALTERNATE BASE RATE MARGIN" means: (i) for
         the period commencing on the Restatement Date and ending on May 31,
         2003, one and three

                                       23

<PAGE>

         quarters percent (1.750%) per annum and (ii) thereafter, such
         percentage as adjusted pursuant to Section 2.13(b)(ii) of this
         Agreement.

                  "REVOLVING CREDIT BORROWING" means a Borrowing in respect of
         Revolving Credit Advances.

                  "REVOLVING CREDIT COMMITMENT" means, in respect of a Bank, the
         Revolving Credit Commitment of such Bank as set forth in Annex I and as
         further specified in Section 2.1 of this Agreement.

                  "REVOLVING CREDIT LIBOR MARGIN" means: (i) for the period
         commencing on the Restatement Date and ending on May 31, 2003, two and
         three quarters percent (2.750%) per annum and (ii) thereafter, such
         percentage as adjusted pursuant to Section 2.13(b)(ii) of this
         Agreement.

                  "REVOLVING CREDIT NOTE" means: (i) the amended and restate
         promissory note of a Borrower payable to the order of each Bank, in
         substantially the form of Exhibit A-1 hereto and in the original
         principal amount of such Bank's Revolving Credit Commitment, evidencing
         the indebtedness of such Borrower to the Bank resulting from the
         Revolving Credit Advances made by such Bank to such Borrower and (ii)
         any Revolving Credit Note executed by any Borrower admitted as a
         Borrower pursuant to an Additional Borrower Addendum.

                  "REVOLVING CREDIT TERMINATION DATE" means December 2, 2007, as
         extended pursuant to Section 2.14 of this Agreement or the earlier date
         of the termination of the Revolving Credit Commitments pursuant to
         Section 2.9(d) or Section 7 of this Agreement.

                  "SECURITIES ACCOUNT" means and includes a "securities account"
         as defined in the UCC.

                  "SECURITIES INTERMEDIARY" means a "securities intermediary" as
         defined in the UCC.

                  "SENIOR SUBORDINATED INDENTURE" means that certain First
         Amended and Restated Indenture, dated as of September 12, 2002, as
         amended and restated as of December 2, 2002, between International and
         CVC Capital Funding LLC, as the same may be amended, restated or
         supplemented.

                  "SENIOR SUBORDINATED NOTES" means those certain $30,000,000
         11% Senior Subordinated Notes due 2012 issued pursuant to the Senior
         Subordinated Indenture on September 12, 2002.

                  "SENIOR SUBORDINATED INDEBTEDNESS" means the Subordinated
         Indebtedness under or in respect of the Senior Subordinated Notes and
         the Senior Subordinated Indenture, in the original principal amount of
         $30,000,000.

                  "SOFTWARE" means and includes "software" as defined in the
         UCC.

                  "SOLVENT" means, with respect to any Person, on any date of
         determination, that on such date: (a) fair value of the property of the
         Person is greater than the total amount of liabilities (including
         contingent liabilities) of the Person, (b) the present fair salable
         value of the assets of the Person is not less than the amount that will
         be required to pay the probable liability of the Person on its debts as
         they become absolute and matured,

                                       24

<PAGE>

         (c) the Person is able to pay all liabilities of the Person as those
         liabilities mature, and (d) the Person does not have unreasonably small
         capital for the business in which it is engaged or for any business or
         transaction in which it is about to engage. In computing the amount of
         contingent liabilities at any time, it is intended that they be
         computed at the amount that, in light of all the facts and
         circumstances existing at the time, represents the amount that can
         reasonably be expected to become an actual or matured liability.

                  "STANDBY LETTER OF CREDIT" means any letter of credit issued
         by the Fronting Bank or the Affiliate Fronting Bank from time to time
         at the request of International pursuant to the terms of this Agreement
         which letter of credit is not a Trade Letter of Credit.

                  "SUBORDINATED INDEBTEDNESS" means any and all Indebtedness
         owing by any Borrower or Holding to any Person, now or hereafter
         existing, that is expressly subordinated and made junior to the payment
         and performance in full of the Obligations and which subordination is
         evidenced by a written agreement in form and substance satisfactory to
         the Loan Parties.

                  "SUBORDINATION AGREEMENT" means any Subordination Agreement
         described on Annex III, as amended from time to time, in substantially
         the form attached hereto as Exhibit J and by reference made a part
         hereof.

                  "SUBSIDIARY" means, in respect of a corporate Person, a
         corporation or other business entity the shares constituting a majority
         of the outstanding capital stock (or other form of ownership) or
         constituting a majority of the voting power in any election of
         directors (or shares constituting both majorities) of which are (or
         upon the exercise of any outstanding warrants, options or other rights
         would be) owned directly or indirectly at the time in question by such
         Person or another subsidiary of such Person or any combination of the
         foregoing.

                  "SUBSTANTIAL GUARANTOR" means a direct or indirect
         Wholly-Owned Subsidiary of a Borrower, which is not a Non-US
         Subsidiary, which Subsidiary has assets or sales of greater than Twelve
         Million Five Hundred Thousand Dollars ($12,500,000) and which has
         guaranteed the Obligations.

                  "SUPPLEMENTAL SCHEDULE" means (i) the schedule which is
         attached hereto as Annex IV and is incorporated into this Agreement and
         (ii) any schedule consistent with Annex IV which is attached to any
         Additional Borrower Addendum.

                  "SUPPORTING OBLIGATION" means and includes a "supporting
         obligation" as defined in the UCC.

                  "SYNDICATION AGENT" mean National City Bank, in its capacity
         as Syndication Agent.

                  "TAXES" has the meaning specified in Section 12.3(a) of this
         Agreement.

                  "TERM ADVANCE" means the one time Advance made by a Bank on an
         amortizing term basis pursuant to Section 2.6(a) of this Agreement.

                  "TERM ADVANCE REPAYMENT DATE" has the meaning specified in
         Section 2.6(d) of this Agreement.

                                       25

<PAGE>

                  "TERM ALTERNATE BASE RATE ADVANCE" means an Advance
         denominated in Dollars which bears interest as provided in Section
         2.13(c)(i) of this Agreement.

                  "TERM ALTERNATE BASE RATE MARGIN" means: (i) for the period
         commencing on the Restatement Date and ending on May 31, 2003, two
         percent (2.000%) per annum and (ii) thereafter, such percentage as
         adjusted pursuant to Section 2.13(d)(ii) of this Agreement.

                  "TERM BORROWING" means a Borrowing of LIBOR Advances or
         Alternate Rate Advances comprising all or a portion of the Term Advance
         of each of the Banks.

                  "TERM LIBOR MARGIN" means: (i) for the period commencing on
         the Restatement Date and ending on May 31, 2003, three and one half
         percent (3.500%) per annum and (ii) thereafter, such percentage as
         adjusted pursuant to Section 2.13(d)(ii) of this Agreement.

                  "TERM NOTE" means, with respect to each Bank, the promissory
         note of the Borrowers payable to such Bank, substantially in the form
         of Exhibit A-2 hereto, and in an original principal amount equal to the
         Term Advance of such Bank specified in Annex I to this Agreement,
         evidencing the aggregate indebtedness of the Borrowers to such Bank
         resulting from the Term Advance made by such Bank.

                  "TRADE LETTER OF CREDIT" means any trade letter of credit
         issued by the Fronting Bank from time to time at the request of
         International pursuant to the terms of this Agreement for the purpose
         of purchasing goods or services in the ordinary course of business.

                  "TYPE" means, when used in respect of any Advance, the LIBOR
         or the Alternate Base Rate.

                  "UCC" means the Uniform Commercial Code as from time to time
         in effect in the State of Ohio; provided, however, that, if, by reason
         of mandatory provisions of law, any or all of the attachment,
         perfection or priority of the Administrative Agent's security interest
         in any Collateral is governed by the Uniform Commercial Code as in
         effect in a jurisdiction other than the State of Ohio, the term "UCC"
         means the Uniform Commercial Code as from time to time in effect in
         such other jurisdiction for purposes of the provisions hereof relating
         to such attachment, perfection or priority and for the purposes of
         definitions related to such provisions; provided, further, that, if the
         UCC is amended after the date hereof, such amendment will not be given
         effect for the purposes of this Agreement to the extent such amendment
         would limit or eliminate any property or asset of a debtor from being
         Collateral.

                  "US SUBSIDIARY" means a direct or indirect Subsidiary of
         International which is incorporated in the United States.

                  "UNITED STATES" and "U.S." each means United States of
         America.

                  "WHOLLY-OWNED SUBSIDIARY" shall mean (a) in the case of any
         Subsidiary organized under the laws of any jurisdiction located in the
         United States, a Subsidiary in which a Borrower, directly or
         indirectly, owns one hundred percent (100%) of the outstanding common
         stock and (b) in the case of any other Subsidiary, a Subsidiary in
         which the Borrower, directly or indirectly, owns 95% or more of the
         outstanding common stock.

                                       26

<PAGE>

                                    Annex III

                          CONDITIONS TO INITIAL FUNDING

<PAGE>

                                    Annex IV

                              SUPPLEMENTAL SCHEDULE

        Amended and Restated Multicurrency Credit and Security Agreement,
                            dated as of May 2_, 2002,
   among ERICO International Corporation, other Borrowers, the Administrative
                     Agent, the Issuing Banks and the Banks

                                    OMITTED

<PAGE>

                                     Annex V

                          ADDITIONAL BORROWER ADDENDUM

         Reference is made hereby to Section 1.5 of the Second Amended and
Restated Multicurrency Credit and Security Agreement, dated as of December 2,
2002 (the "Agreement"), among ERICO International Corporation, an Ohio
corporation, ERICO Products, Inc., an Ohio corporation and ERICO Europa B.V., a
limited liability company organized under the laws of the Netherlands_ (the
"Borrowers"), the Banks that are party thereto (the "Banks"), LaSalle Bank
National Association, as Administrative Agent for the Banks (the "Administrative
Agent"), National City Bank, as Syndication Agent, General Electric Capital
Corporation, as Co-Lead Arranger and Co-Documentation Agent, KeyBank National
Association, as Documentation Agent and LaSalle Bank National Association, as
Issuing Bank (the "Issuing Bank" and, together with the Banks and the
Administrative Agent, the "Loan Parties").

         By executing this Additional Borrower Addendum, the undersigned agrees
that, upon acceptance of this Additional Borrower Addendum by the Administrative
Agent and the Loan Parties as hereinbelow provided for, upon acknowledgment and
acceptance hereof by the other Borrowers as hereinafter provided for, and upon
satisfaction of the other terms and conditions hereof, the undersigned shall:
(i) become a party to the Agreement as if an original signatory thereto, (ii) be
bound by all of the provisions of the Agreement except to the extent otherwise
expressly provided hereinafter, and (iii) be considered a Borrower for all
purposes of the Agreement which shall be deemed amended by the terms of this
Additional Borrower Addendum.

         By reason of such execution and acceptance, the Agreement shall be
deemed amended so as to admit the undersigned as a Borrower and pursuant to
which admission the undersigned shall become a Borrower for all purposes of the
Agreement and as if an original signatory to the Agreement.

         In consideration of its being admitted as a Borrower, the undersigned
agrees that such admission shall occur on the following terms and conditions:

         1.       DEFINITIONS. Each capitalized term used in this Additional
Borrower Addendum and not otherwise defined herein shall have the meaning
ascribed to such term in Annex 1 to the Agreement.

         2.       COMMITMENTS. The Revolving Credit Commitment and the Term
Commitment to all Borrowers (including the undersigned) shall not be increased.

         3.       CONDITIONS PRECEDENT. This Additional Borrower Addendum shall
be effective and the Agreement shall be amended as contemplated hereby subject
to the condition precedent that on or prior to the date hereof:

                  3.1      CLOSING OF NOTES. Each of the Borrowers (including
         the undersigned as a Borrower) shall have executed Revolving Credit
         Notes and Term Notes in favor of each of the Banks reflecting the
         undersigned's admission as a Borrower.

                  3.2      ANNEX III. The conditions specified in Annex III to
         the Agreement shall have been satisfied with respect to the undersigned
         with such modifications as are required by the Administrative Agent and
         the Loan Parties to reflect the facts and circumstances applicable to
         the undersigned. The Administrative Agent shall have

<PAGE>

         received the documents and deliveries specified in Annex III with such
         modifications as are required by the Administrative Agent and the Loan
         Parties to reflect such facts and circumstances. Without limiting the
         generality of the foregoing, (a) if the undersigned is a US-Subsidiary,
         the undersigned shall deliver or cause to be delivered the following:
         (i) a Guaranty Agreement-Subsidiaries, (ii) a pledge of 100% of the
         common stock of the undersigned together with the appropriate
         deliveries, (iii) all documentation necessary to create and perfect a
         lien the assets of the undersigned and (iv) each of the other documents
         or deliveries required of or with respect to other US-Subsidiaries and
         (b) if the undersigned is a Non-US Subsidiary, an opinion letter
         consistent with the opinion letters delivered in connection with the
         other Borrowers which are Non-US Subsidiaries.

                  3.3      ACCEPTANCE BY EXISTING BORROWERS. The Borrowers
         (other than the undersigned) shall have acknowledged and agreed to the
         terms of this Additional Borrower Addendum and the resulting amendment
         to the Agreement by executing the below set forth acceptance.

                  3.4      RESOLUTIONS. Each of the other Borrowers shall have
         delivered to the Bank resolutions of such Borrower duly authorizing
         such Borrower's execution of the acceptance set forth below and its
         execution of the Revolving Credit Notes and Term Notes.

         4.       REPRESENTATIONS AND WARRANTIES; SUPPLEMENTAL SCHEDULE. Except
as set forth in the Supplemental Schedule to this Additional Borrower Addendum,
the undersigned represents and warrants to the Administrative Agent and each of
the Loan Parties as to the undersigned (and as to the other Borrowers to the
extent specified in the Agreement) the representations and warranties of a
Borrower set forth in Sections 4, 5, 6, and 7 of the Agreement and Section 3.2
of the Agreement. Pursuant to Section 3.3 of the Agreement, the exceptions to
the representations and warranties set forth in the Supplemental Schedule of the
undersigned attached hereto shall be incorporated by reference into the
Agreement as if fully written therein.

         5.       COVENANTS; SUPPLEMENTAL SCHEDULE. Except as set forth in the
Supplemental Schedule to this Additional Borrower Addendum, the undersigned
shall comply, and shall cause its Subsidiaries to comply, with each of the
agreements and covenants applicable to a Borrower under the Agreement including,
without limitation, the covenants set forth in Sections 4, 5, 6, and 8 of the
Agreement. Pursuant to Section 3.3 of the Agreement, the exceptions to the
covenants set forth in the Supplemental Schedule attached hereto shall be
incorporated by reference into the Agreement as if fully written therein.

         6.       CONFIRMATORY GRANT. In order to confirm its grant of a
security interest to the Bank pursuant to Section 4 of the Agreement, the
undersigned, if the undersigned is not a Non-US Subsidiary, hereby grants and
pledges to the Administrative Agent for the benefit of the Loan Parties a
security interest in, all of the right, title and interest of the undersigned in
and to the Collateral (as defined in the Agreement), whether now owned or
existing or hereafter acquired or arising and wheresoever located, to secure the
payment and performance of the Obligations of the undersigned under the
Agreement.

         7.       AMENDMENTS TO THE AGREEMENT. Upon acceptance of this
Additional Borrower Addendum by the Administrative Agent, each of the Loan
Parties and the Borrowers, the Borrowers (including the undersigned) and the
Banks hereby agree that the Agreement shall be amended, effective as of the date
hereof, as follows:

                  7.1      AMENDMENT TO SECTION 7.13. Section 7.13 of the
         Agreement shall be amended so as to add a sentence after the second
         sentence thereto as follows:

                                       2

<PAGE>

                  7.13 FINANCIAL STATEMENTS. __________ has furnished the Bank
                  with complete and correct copies of its audited balance sheets
                  for its Fiscal Years ending _______ 30, 200__ and ______,
                  200__, and the related statements of operations, stockholder's
                  equity, and cash flow, and, as applicable, changes in
                  financial position or cash flows for such Fiscal Years, and
                  the notes to such financial statements, reported upon by
                  _____________, certified public accountants, together with the
                  internal financial statements for its Fiscal Month *** ending
                  ___________, 200_, certified in each case by the President or
                  the Chief Financial Officer of ___________.

                  [OTHER AMENDMENTS TO BE ADDED IF NECESSARY]

                  7.2      AMENDMENT TO SECTIONS 8.3(d)(III)(G)(H) AND (K).
         Sections 8.3(d)(iii)(G)(H) and (K) of the Agreement shall be amended so
         as to change the permitted amounts specified therein to be _________
         Dollars ($_________________), _________________ Dollars
         ($_____________), and ____________ Dollars ($___________),
         respectively.

         The Agreement, as amended by this Additional Borrower Addendum, remains
in full force and effect and remains the valid and binding obligation of the
Borrowers enforceable against the Borrowers in accordance with its terms. Each
Borrower hereby ratifies and confirms the Agreement as amended by this
Additional Borrower Addendum.

         The execution, delivery, performance and effectiveness of this
Additional Borrower Addendum shall not operate nor be deemed to be nor construed
as a waiver: (i) of any right, power or remedy of the Administrative Agent or
the Loan Parties under the Agreement nor (ii) of any term, provision,
representation, warranty or covenant contained in the Agreement or any other
documentation executed in connection therewith. Further, none of the provisions
of this Additional Borrower Addendum shall constitute, be deemed to be or
construed as, a waiver of any Default or Event of Default under the Agreement as
amended by this Additional Borrower Addendum.

         8.       GENERAL.

                  8.1      BINDING EFFECT. This Agreement shall become effective
         when it shall have been executed by the undersigned, each Borrower, the
         Administrative Agent and each of the Loan Parties and shall be binding
         upon and inure to the benefit of the undersigned, each such Borrower,
         the Administrative Agent and each of the Loan Parties and their
         respective successors and assigns, except that the Borrower shall not
         have the right to assign its rights hereunder.

                  8.2      CAPTIONS. The several captions to different Sections
         and the respective subsections thereof are inserted for convenience
         only and shall be ignored in interpreting the provisions of this
         Additional Borrower Addendum.

                  8.3      GOVERNING LAW. This Additional Borrower Addendum and
         the respective rights and obligations of the parties hereto shall be
         governed by and construed in accordance with the internal laws of the
         State of Illinois (without giving effect to the conflict of laws rules
         thereof).

                  8.4      EXECUTION IN COUNTERPARTS. This Additional Borrower
         Addendum may be executed in any number of counterparts and by different
         parties hereto in separate counterparts, each of which when so executed
         shall be deemed to be an original and all of which taken together shall
         constitute but one and the same agreement.

                                       3

<PAGE>

         IN WITNESS WHEREOF, the undersigned has caused this Addendum to be
executed as of this __ day of __________, 200_.

                                            ____________________________________

                                            By:  _______________________________
                                            Its:  ______________________________

                                            Address for notices:

                                            ____________________________________
                                            ____________________________________
                                            Attention: _________________________
                                            Telecopy: _________________________

ACCEPTANCE

         Upon execution of this Acceptance, the Administrative Agent and each of
the Loan Parties hereby agrees that the Agreement is amended to admit the above
named signatory to this Addendum as a Borrower under the Agreement pursuant to
the terms of Section 1.5 of the Agreement and this Addendum.

         LASALLE BANK NATIONAL ASSOCIATION, AS
         AS ADMINISTRATIVE AGENT, A BANK AND ISSUING BANK

         ____________________________________
         By: ________________________________
         Its: _______________________________

         NATIONAL CITY BANK, AS
         A BANK AND AS SYNDICATION AGENT

         ____________________________________
         By: ________________________________
         Its: _______________________________

         GENERAL ELECTRIC CAPITAL CORPORATION, AS CO-DOCUMENTATION AGENT AND A
         BANK

                                       4

<PAGE>

         ____________________________________
         By: ________________________________
         Its: _______________________________

         KEYBANK NATIONAL ASSOCIATION, AS CO-DOCUMENTATION AGENT AND A BANK

         ____________________________________
         By: ________________________________
         Its: _______________________________

                                       5

<PAGE>

              ACKNOWLEDGEMENT OF BORROWERS AND BORROWER GUARANTORS

         Each of the undersigned Borrowers under the Agreement hereby
acknowledges and agrees to the terms of the foregoing Addendum and the resulting
amendment to the Agreement contemplated thereby. Each of the undersigned
represents and warrants that the Borrower Guaranty of such Borrower set forth in
Section 9 of the Agreement remains the valid and binding obligation of the
undersigned, enforceable against it in accordance with its terms.

[___________________________________________], as
a Borrower

___________________________________________
By: _______________________________________
Title: ____________________________________

[___________________________________________], as
a Borrower

___________________________________________
By: _______________________________________
Title: ____________________________________

                                       6

<PAGE>

                                    Annex VI

                            INTERIM WAIVER AGREEMENT

                                       N/A

                                       7

<PAGE>

                                    ANNEX VII

             EXISTING LETTERS OF CREDIT ISSUED BY NATIONAL CITY BANK

<TABLE>
<CAPTION>
L/C NUMBER                  BENEFICIARY               ISSUE DATE          EXPIRATION DATE         AMOUNT
-----------------------------------------------------------------------------------------------------------
<S>               <C>                                 <C>                 <C>                   <C>
   7209           Korea Electric Power Company        11/19/2001             8/31/2005          $227,780.00
-----------------------------------------------------------------------------------------------------------
   5697           Korea Electric Power Company          3/3/99               2/28/2003          $216,090.45
-----------------------------------------------------------------------------------------------------------
</TABLE>

                                       8

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00065-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00065-of-00352.parquet"}]]