Document:

Exhibit
10.3

 

EMPLOYMENT
AGREEMENT

 

                This
EMPLOYMENT AGREEMENT effective July 1, 2007, is by and between Veeco
Instruments Inc., a Delaware corporation (the “Company” or “Employer”), and
John R. Peeler (“Executive”).

 

                The
Company and Executive hereby agree as follows:

 

                1.             Definitions.  As used herein, the following definitions
shall apply:

 

                                “Board”
shall mean the Board of Directors of the Company.

 

                                “Change
of Control” shall mean:  (a) any
person or group of persons becomes the beneficial owner of securities
representing 50 percent or more of the Company’s outstanding voting securities,
or (b) the approval by the Company’s stockholders of one of the following:

 

(i)  Any merger or statutory plan
of exchange (“Merger”) in which the Company would not be the surviving
corporation or pursuant to which the Company’s voting securities would be
converted into cash, securities or other property, other than a Merger in which
the holders of the Company’s voting securities immediately prior to the Merger
have the same proportionate ownership of voting securities of the surviving
corporation after the Merger;

 

(ii)  Any Merger in which the
holders of outstanding voting securities of Veeco prior to such Merger will
not, in the aggregate, own a majority of the outstanding voting securities of
the combined entity after such Merger; or

 

(iii)  Any sale or other transfer
(in one transaction or a series of related transactions) of all or
substantially all of the Company’s assets or the adoption of any plan or
proposal for the Company’s liquidation or dissolution.

 

                                “Disability”
shall mean (i) the inability of Executive (whether due to accident, sickness or
other cause) to perform his designated responsibilities for the Company for a
period that would entitle Executive to qualify for long-term disability
benefits under the Company’s then-current long-term disability insurance
program or (ii) in the absence of such a program, the Executive is, by reason
of any medically determinable physical or mental impairment which can be expected
to last for a continuous period of not less than 12 months, receiving income
replacement benefits for a period of not less than three months under an
accident, disability or health plan covering employees of the Company.
Disability of Executive shall be determined by the Board.

 

                                “Severance
Period” shall mean the Severance Period specified on the signature page
hereto.

 

                                Termination
for “Cause” shall mean a termination based on (i) Executive’s willful and
substantial misconduct in the performance of his duties, (ii) Executive’s
willful failure to

 

 

 

perform his duties after two weeks written
notice from the Company (other than as a result of a total or partial
incapacity due to a physical or mental illness, accident or similar event),
(iii) the Executive’s material breach of any of the agreements contained in
Sections 5, 6 or 7 hereof, (iv) the commission by Executive of any material
fraudulent act with respect to the business and affairs of the Company or any
subsidiary or affiliate thereof or (v) Executive’s conviction of (or plea of nolo
contendere to) a crime constituting a felony.  The Company may terminate Executive’s
employment for Cause only with the approval of a majority of the Board.  Prior
to any termination for Cause as defined in subsections (i), (ii), (iii) and
(iv), herein, Executive shall have an opportunity to appear before the Board to
present his position, provided that such appearance shall be scheduled within
two calendar weeks after Executive’s receipt of a notice of intent to terminate
which specifies the facts on which the proposed termination for cause is based.

 

                                Termination
for “Good Reason” shall mean termination by Executive of his employment
with the Company hereunder based on:

 

(a)           an involuntary diminution in the Executive’s position,
title, responsibilities, authority or reporting responsibilities;

(b)           an involuntary
material reduction by the Company in Executive’s base salary (other than a
salary reduction made as part of a salary reduction program affecting employees
similarly situated to Executive generally);

(c)           a significant
reduction by the Company in total benefits available to Executive under cash
incentive, stock incentive and other employee benefit plans (other than a
reduction in benefits affecting employees similarly situated to Executive
generally);

 

(d)           an involuntary relocation of the Executive’s primary place
of work by more than 50 miles from its then current location (it being
understood that Executive’s decision not to relocate would not be a basis for
Termination for Cause);

 

(e)           the Executive is not appointed to the Board within thirty
(30) days of his first day of employment with the Company or thereafter
involuntarily ceases to be a member of the Board, or

 

(f)            the breach by the Company of any of its material
obligations under this Agreement.

 

A termination will
not be considered Good Reason as defined herein unless Executive provides the
Company with written notice of the existence of the applicable condition
described in clauses (a) through (f) above no later than 90 days after the
initial existence of such condition is known by the Executive and the Company
fails to remedy such condition within 30 days of the date of such written
notice.

 

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                2.             Employment.

 

                (a)           General.  The Company hereby employs the Executive in
the position set forth on the signature page hereto or such other position as
the Company and Executive may mutually agree, and the Executive hereby accepts
such employment by the Company, upon the terms and conditions set forth
herein.  The Executive will faithfully
perform the duties and responsibilities of such office, as they may be assigned
from time to time by the Board.  In
addition, while Executive is employed by the Company, the Company will use its
best efforts to ensure the Executive is a member of the Board.  The Executive shall devote his full business
time, attention and energy to the business of the Company.  The Executive will not be engaged in any
other business activity which, in the reasonable judgment of the Board,
conflicts with the duties of the Executive hereunder, whether or not such
activity is pursued for gain, profit or other pecuniary advantage.  The parties agree that Executive’s employment
with the Company constitutes “at-will” employment which may be terminated by
either party at any time, upon written notice to the other, with or without
cause or for any or no cause.  As
described in this Agreement, Executive may be entitled to severance benefits
depending upon the circumstances of Executive’s termination of employment.  Notwithstanding the foregoing, nothing herein
shall prohibit the Executive from serving on boards of directors or committees
with the Board’s prior approval.

 

                (b)           Base Salary.  The Company will pay Executive an annual base
salary in the amount specified as the Initial Base Salary on the signature page
hereto (“Base Salary”), payable
in accordance with the Company’s normal payroll policy.  The Base Salary shall be reviewed annually
for increases but may not be decreased (other than a salary reduction made as
part of a salary reduction program affecting employees similarly situated to
Executive generally).

 

                (c)           Bonus.

(i)         Management Bonus
Plan.  The Executive shall be
eligible to participate in cash incentive plans as established from time to
time by the Compensation Committee of the Board (the “Committee”) and subject
to achievement of the performance goals specified thereunder.  Executive’s
target bonus will be 100% of Base Salary for the plan year for this bonus plan
(January 1 through December 31).  For the
first year of service, the bonus payment will be pro-rated to reflect the
actual start date.

(ii)        Sign-On
Bonus.  A sign-on bonus, in the
amount of $1,000,000 shall be paid to Executive on or before December 31, 2007;
provided that Executive is actively employed by the Company and in good
standing on the aforementioned payment date; provided, further, that (A) if
Executive’s employment is terminated by the Company for Cause or by Executive
without Good Reason prior to the first anniversary of Executive’s start date
with the Company, then Executive shall reimburse the Company for the full
amount of the sign-on bonus, and (B) if Executive’s employment is terminated by
the Company for Cause or by Executive without Good Reason on or after the first
anniversary of Executive’s start date with the Company and prior to the second
anniversary of Executive’s start date with the Company, then Executive shall
reimburse the Company for one-half (1/2) of the sign-on bonus.  Such reimbursement shall be made by Executive
within 10 days of such termination.

 

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(iii)       Long-Term Cash-Based Incentive Plan.  Executive shall be eligible to
participate in the Company’s Long-Term Cash-Based Incentive Plan, as
established from time to time by the Committee and subject to achievement of
the performance goals specified thereunder. 
Executive’s target bonus will be 75% of Base Salary, pro-rated for the
first year of employment to reflect the actual start date.  Awards payable under this plan will be earned
over a three-year period based on the achievement of performance metrics.

 

                (d)           Benefits; Stock Options; Restricted Stock.  In addition to the Base Salary and bonus plans
referred to above, the Executive shall be entitled to participate in such
employee benefit plans or programs of the Company, and shall be entitled to
such other fringe benefits, as are from time to time made available by the
Company generally to employees of the Executive’s position, tenure, salary, and
other qualifications.  Without limiting
the generality of the foregoing, the Executive shall receive:

(i)         Initial Hire
Grants.  Effective upon Executive’s first day of
employment (the “Grant Date”), Executive shall be granted the following
pursuant to the terms of the Company’s 2000 Stock Incentive Plan, as amended
(the “Plan”):

(1)           A restricted stock award in the amount of 150,000 shares of Veeco Common
Stock and subject to the terms and conditions specified in the form of award
notice attached hereto as Appendix A. 
The restrictions on these shares will lapse with respect to one third of
the total award on each of the first three anniversaries of the Grant Date as
specified in Appendix A.

(2)           A stock option award to purchase 250,000 shares of Veeco Common Stock
with an exercise price equal to the fair market value of Veeco Common Stock on
the Grant Date and subject to the terms and conditions specified in the
Plan.  One third of these options shall
become exercisable on each of the first three anniversaries of the Grant Date.

 

(ii)        2008 Grants.  On
the same date as annual awards are generally made to other eligible employees
(the “2008 Grant Date”), Executive shall, if actively employed in good
standing, receive the following:

(1)           A restricted stock award in the amount of 50,000 shares of Veeco Common
Stock. The restrictions on these shares will lapse with respect to one third of
the total award on each of the first three anniversaries of the 2008 Grant Date
and this award shall be subject to terms and conditions substantially similar
to those specified in Appendix A.

(2)           A stock option award to purchase 100,000 shares of Veeco Common Stock
with an exercise price equal to the fair market value of Veeco Common Stock on
the 2008 Grant Date.  One third of these
options shall become exercisable on each of the first three anniversaries of
the 2008 Grant Date and these options shall be subject to the terms and
conditions specified in the Plan.

In the event of any
change in the capital structure of the Company on or before the 2008 Grant
Date, the number of shares of Veeco Common Stock subject to the 2008 Grants
shall be adjusted equitably to reflect any such change.

 

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(iii)       Car Allowance. 
During the employment period, the Company will pay the Executive
a car allowance of $1,500, subject to
applicable tax withholding, which shall be paid not less frequently than on a
monthly basis in accordance with the Company’s regular payroll practices.

(iv)       Vacation. 
Executive shall accrue vacation at the rate of four weeks per calendar
year.  As of the start date of
employment, Executive shall be awarded a vacation bank of two weeks of vacation
and during the remainder of calendar year 2007 will accrue vacation at the rate
consistent with an annual four week vacation accrual.

 

(v)        Relocation. 
Executive’s office will be based in Woodbury, New York.  During the first year of Executive’s
employment (and prior to Executive’s relocation to the Woodbury, NY area), the
Company will reimburse Executive’s reasonable housing and transportation
expenses, including a tax gross-up for these amounts.  Such amounts, including the tax gross-up,
shall not exceed $100,000.  The Company shall
also reimburse Executive an amount equal to closing costs on the sale and
purchase of a home and movement/storage of household goods at such time as
Executive relocates to the Woodbury, NY area.

 

                (e)           Reimbursement of Expenses.  The Company will reimburse the Executive, in
accordance with the practices in effect from time to time for other officers or
staff personnel of the Company, for all reasonable and necessary traveling
expenses and other disbursements incurred by the Executive for or on behalf of
the Company in the performance of the Executive’s duties hereunder, upon
presentation by the Executive to the Company of appropriate vouchers or
documentation.

 

                (f)            Continuation of Benefits.  The
Executive acknowledges and agrees that the Company does not guarantee the
adoption or continuance of any particular employee benefit plan or program or
other fringe benefit during the employment period, and participation by the
Executive in any such plan or program shall be subject to the rules and
regulations applicable thereto.

 

                (g)           Certain Reimbursement Requirements.  Any reimbursement provided under Section
2(d)(v) and Section 2(e) shall (i) be paid no later than the last day of
Executive’s tax year following the tax year in which the expense was incurred,
(ii) not be affected by any other expenses that are eligible for reimbursement
in any tax year and (iii) not be subject to liquidation or exchange for another
benefit; provided, however, a reimbursement payment for tax gross-ups shall be
made no later than the end of the Executive’s tax year immediately following
the tax year in which Executive remits the related taxes to an agency.

 

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                3.             Compensation Upon Termination.  (a)  If
Executive’s employment with the Company terminates for any reason (including,
death or Disability and whether or not such termination results from or is in
connection with a Change in Control), other than pursuant to a termination of
Executive’s employment for Cause or a resignation by the Executive without Good
Reason, and contingent upon Executive’s compliance with this Agreement and
execution of the Release of Claims (as provided in Section 4 below), without
revocation, Executive (or, if applicable, his estate) shall be entitled to the
following benefits:

 

(i)                                     The Company
shall pay Executive severance in an amount equal to the amount of Executive’s
annual base salary as in effect immediately prior to such termination (but
without regard to any salary reduction program then in place) which would have
been payable over the Severance Period absent such termination.  This severance shall be payable over the
Severance Period in equal installments on Employer’s regular pay days, in each
case commencing on the Company’s first pay day which is at least 21 days after
the later of (i) expiration of the applicable revocation period following
execution of the Release of Claims (without revocation)  and (ii) the termination date.

 

(ii)                                  Executive shall
be entitled to receive a pro rata portion of his target bonus for the year in which termination occurs under the management bonus plan in effect at
the time of termination.  Such amount
shall be payable on the later of:  (i)
expiration of the applicable revocation period following execution of the
Release of Claims (without revocation)  and
(ii) the same date(s) that the Company makes it bonus payments to employees
generally with regard to such year.

 

(iii)                               During the
Severance Period, the Executive shall be entitled to participate in all group
health and insurance programs and all other benefits, fringe benefits and
perquisites available generally to senior executives of the company (including
in the case of health programs, continued coverage for the Executive’s spouse
and eligible dependents).  In the event
that the Executive’s participation in any such plan or program is prohibited by
operation of law or by the terms of such plan or program as in effect
immediately preceding the date of termination of the employment period, the Company shall arrange to provide (or reimburse
Executive for the reasonable cost of) benefits substantially similar to those
which the Executive would have been entitled to receive under such plans and
programs.  In either event, the level of
Company contribution to such plans shall be equal to the contribution level for
an active executive of the Company.  Nothing herein shall require the Company to
maintain any group benefit plans for its senior executives or prevent the
Company from modifying its group benefit plans or contribution level for its senior
executives. Any reimbursement or benefit the Executive is entitled to receive
pursuant to this Section 3(a)(iii) shall (I) be paid no later than the last day
of Executive’s tax year following the tax year in which the expense was
incurred, (II) not be affected by any other expenses that are eligible for
reimbursement in any tax year and (III) not be subject to liquidation or
exchange for another benefit.

 

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(iv)                              Any options to
purchase shares of the Company’s stock which are held by Executive as of the
date of termination that were not vested and exercisable as of such date shall
become immediately and fully vested and exercisable as of such date.

 

(v)                                 Executive shall
retain the right to exercise any options to purchase shares of the Company’s
stock which are held by Executive as of the date of termination until the
earlier of (a) the end of the Severance Period and (b) the expiration of the
original full term of each such option.

 

(vi)                              Any shares of
restricted stock or restricted stock units which are held by Executive as of
the date of termination shall become vested and the restrictions with regard
thereto shall lapse upon such termination.

 

(vii)                           The Sign-On
Bonus, if not previously paid, shall be paid within 21 days after the later of
(I) expiration of the applicable revocation period following execution of the
Release of Claims (without revocation)  and
(II) the termination date.

 

                (b)           If Executive’s employment with the
Company is terminated by the Company for Cause or is terminated by Executive
without Good Reason, the Executive will not have any further rights or claims
against the Company under this Agreement except the right to receive (i) the
unpaid portion of Executive’s base salary computed on a pro rata basis to the date of termination,
(ii) payment of his previously accrued but unpaid rights that are then payable
in accordance with the terms of any incentive compensation, equity incentive,
retirement, employee welfare or other employee benefit plans or programs of the
Company in which the Executive is then participating, and (iii) reimbursement
for any expenses for which the Executive shall not have theretofore been
reimbursed, provided such reimbursement shall be subject to the applicable requirements
provided in Section 2(g).

 

                4.             Release of Claims.  Receipt of the benefits described in Section
3 is conditioned upon the execution by Executive (without revocation) of a
general release and waiver of claims against the Company in a form satisfactory
to the Company.  In the case of
termination on account of death or Disability, such general release and waiver
of claims may be provided by Executive’s personal representative or in another
manner reasonably satisfactory to the Company.

 

                5.             Confidentiality and Assignment
of Inventions.

 

                (a)           Confidentiality.  During the term of Executive’s employment
with Employer and for five years thereafter, Executive will not use or disclose
to any individual or entity any Confidential Information (as defined below)
except (i) in the performance of Executive’s duties for Employer, (ii) as
authorized in writing by Employer, or (iii) as required by law or legal
process, provided, that, prior written notice of such required disclosure is
provided to Employer and, provided, further, that, all reasonable efforts to
preserve the confidentiality of such information shall be made.  As used herein, “Confidential Information”
shall mean information that (i) is used or potentially useful in Employer’s
business, (ii) Employer treats as proprietary,

 

7

 

private or confidential, and (iii) is not
generally known to the public.  “Confidential
Information” includes, without limitation to, information relating to Employer’s
products or services, processing, manufacturing, selling, customer lists, call
lists, customer data, memoranda, notes, records, technical data, sketches,
plans, drawings, chemical formulae, trade secrets, composition of products,
research and development data, sources of supply and material, operating and
cost data, financial information, and information contained in manuals or
memoranda.  “Confidential Information”
also includes proprietary and/or confidential information of Employer’s
customers, suppliers and trading partners who may share such information with
Employer pursuant to a confidentiality agreement or otherwise.  The Executive agrees to treat all such
customer, supplier or trading partner information as “Confidential Information”
hereunder.

 

                (b)           Inventions.  (i) 
Attached as Appendix B hereto is a compete and accurate list of
each invention, discovery, idea, improvement or application (each, an “Invention”)
whether or not patentable, conceived, developed, created or made by Executive,
either alone or with others, prior to employment with Employer.  Except as set forth on Appendix B,
Executive has no unpatented Inventions which are to be withheld from this
Agreement and all present or future Inventions that are created, conceived,
developed or made by Executive during his employment or pursuant to clause
5(b)(ii)(B) of this Agreement are subject to assignment to Employer hereunder.

 

                                (ii)           Executive shall promptly advise
Employer, in writing, of each Invention, whether or not patentable, which is in
any way or manner related to the business of Employer or resulting from or was
suggested by any work done for Employer and which is conceived, developed,
created or made by Executive, alone or with others, (A) during his employment
with Employer or (B) within two years after the termination of Executive’s
employment with Employer but which is based on Employer’s trade secrets or
Confidential Information (each, an “Employer Related Invention”).  Each Employer Related Invention shall become
the sole and exclusive property of Employer. 
Executive agrees to disclose the same promptly to Employer, to execute
all documents requested by Employer for vesting in it the entire right, title
and interest in and to the same, to execute all documents requested by Employer
for filing and prosecuting such applications for patents, copyrights and/or
trademarks as Employer, in its sole discretion may desire to prosecute, and to
give Employer all the assistance it reasonably requires, including the giving
of testimony in any suit, action or proceeding, in order to obtain, maintain
and protect Employer’s right therein and thereto.

 

                                (iii)          The assignment of inventions contained
herein shall not apply to an invention that the Executive develops entirely on
his own time without using the Employer’s equipment, supplies, facilities or
trade secret information except for those inventions that either:  (1) relate at the time of conception or
reduction to practice of the invention to the Employer’s business, or actual or
demonstrably anticipated research or development of the Employer; or (2) result
from any work performed by the Executive for the Employer.

 

                (c)           Independent Obligations.  Executive acknowledges and agrees that the
obligations and covenants under this Section 5 are intended to be, and shall be
construed as, agreements separate and independent from other terms and
provisions of his employment.  The
existence of any claim or cause of action by Executive against Employer,
whether predicated on Executive’s

 

8

 

employment or otherwise, shall not constitute
a defense to the enforcement by Employer of said covenants.

 

                (d)           Survival.  In the event of termination of employment by
either party, the provisions of this Section 5 will remain in effect.  Upon termination, Executive will immediately
deliver to Employer all property belonging to Employer then in the Executive’s
possession or control, including all Documents embodying Confidential
Information.  As used herein, “Documents”
shall mean originals or copies of files, memoranda, correspondence, notes,
photographs, slides, overheads, audio or video tapes, cassettes, or disks, and
records maintained on computer or other electronic media.

 

                6.             Non-Competition.  For the duration of Executive’s employment
with the Company and (a) if severance is payable under Section 3 following the
termination of such employment, for the Severance Period or (b) if severance is
not payable under Section 3 following termination of such employment, for
twelve (12) months following such termination (collectively, the “Noncompete
Period”), Executive will not, without the prior written consent of the Company,
directly or indirectly, engage or invest in, own, manage, operate, finance,
control or participate in the ownership, management, operation, financing or
control of, be employed by, associated with, or in any manner connected with,
lend Executive’s name to, lend Executive’s credit to or render services or
advice to, any business whose products or activities compete in whole or in
part with the former, current or currently contemplated products or activities
of the Company or any of its subsidiaries, in any state of the United States or
in any country in which the Company or any of its subsidiaries sells products
or conducts business; provided, however,
that Executive may purchase or otherwise acquire up to (but not more than) one
percent of any class of securities of any enterprise (but without otherwise
participating in the activities of such enterprise) if such securities are
listed on any national or regional securities exchange or have been registered
under Section 12(g) of the Securities Exchange Act of 1934, as amended.  Executive agrees that this covenant is
reasonable with respect to its duration, geographical area, and scope.  During the Noncompete Period, Executive will,
within ten days after accepting any employment, advise the Company of the
identity of any employer of Executive. 
Receipt of the benefits provided under Section 3 is conditioned upon
compliance by Executive with this Section.

 

                7.             Non-Solicitation; Non-Hire.  For the Noncompete Period, Executive hereby
agrees that Executive will not, directly or indirectly, either for himself or
any other person:  (a) induce or attempt
to induce any employee of the Company or any of its subsidiaries to leave the
employ of the Company or such subsidiary, (b) in any way interfere with
the relationship between the Company and its subsidiaries and any employee of
the Company or any of its subsidiaries, (c) employ, or otherwise engage as
an employee, independent contractor or otherwise, any current or former
employee of the Company or any of its subsidiaries, other than such former
employees who have not worked for the Company or any of its subsidiaries in the
prior 12 months; (d) induce or attempt to induce any customer, supplier,
licensee or business relation of the Company or any of its subsidiaries to
cease doing business with the Company or such subsidiary, or in any way
interfere with the relationship between the Company and its subsidiaries and
any customer, supplier, licensee or business relation of the Company or any of
its subsidiaries; or (e) solicit the business of any person known to Executive
to be a customer of

 

9

 

the Company or any of its subsidiaries,
whether or not Executive had personal contact with such person, with respect to
products or activities which compete in whole or in part with the former,
current or currently contemplated products or activities of the Company and its
subsidiaries or the products or activities of the Company and its subsidiaries
in existence or contemplated at the time of termination of Executive’s
employment.  Receipt of the benefits
provided under Section 3 is conditioned upon compliance by Executive with this
Section.

 

                8.             Cutback of Certain Payments.  Notwithstanding any provision in this
Agreement, in the event that Executive would receive a greater after-tax
benefit from the Capped Benefit (as defined below) than from the payments due
as a result of the termination of Executive hereunder and under any other
agreement, plan or program (the “Specified Benefits”), the Capped Benefit shall
be paid to Executive and the Specified Benefits shall not be paid.  The “Capped Benefit” shall mean the Specified
Benefits, reduced by the amount necessary to prevent any portion of the
Specified Benefits from being “parachute payments” as defined in Section
280G(b)(2) of the Internal Revenue Code of 1986, as amended (“IRC”), or any
successor provision.  For purposes of
determining whether Executive would receive a greater after-tax benefit from
the Capped Benefit than from the Specified Benefits, there shall be taken into
account all payments and benefits Executive will receive upon a change in
control of the Company (collectively, excluding the Specified Benefits, the “Change
of Control Payments”).  To determine
whether Executive’s after-tax benefit from the Capped Benefit would be greater
than Executive’s after-tax benefit from the Specified Benefits, there shall be
subtracted from the sum of the before-tax Specified Benefits and the Change of
Control Payments (including the monetary value of any non-cash benefits) any
excise tax that would be imposed under IRC § 4999 and all federal, state and
local taxes required to be paid by Executive in respect of the receipt of such
payments, assuming that such payments would be taxed at the highest marginal
rate applicable to individuals in the year in which the Specified Benefits are
to be paid or such lower rate as Executive advises the Company in writing is
applicable to Executive.  In the event
that the Company and Executive are unable to agree as to the amount of the
reduction described above, if any, Executive shall select a law firm or
accounting firm from among those regularly consulted (during the twelve-month
period immediately prior to the date of termination) by the Company regarding
federal income tax matters, and such law firm or accounting firm shall
determine the amount of such reduction and such determination shall be final
and binding upon Executive and the Company.

 

                9.             Injunctive Relief.  A breach of Executive’s obligations under
Section 5, 6 or 7 hereof may not be one which is capable of being easily
measured by monetary damages and, consequently, Executive specifically agrees
that such sections may be enforced by injunctive relief.  Further, Executive specifically agrees that,
in addition to such injunctive relief, and not in lieu of it, the Company may also
bring suit for damages incurred by the Company as a result of a breach of
Executive’s obligations under such sections.

 

                10.           Arbitration; Waiver of Jury Trial.  Except as provided below and as provided in
Section 9, any dispute or claim arising under this Agreement or in connection
with Executive’s employment with the Company shall be settled solely by
arbitration held in accordance with the Employment Dispute Procedures of the
American Arbitration Association and held in the county and state in which
Executive’s place of employment is located, or any other location mutually
agreed upon by the parties.  Such
proceedings and evidence shall be confidential. 
The arbitrator

 

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shall have the power and the authority to
make such decisions and awards as he or she shall deem appropriate, including,
but not limited to, granting compensatory damages, costs and attorneys fees to
the prevailing party, and the granting or issuance of such mandatory
directions, prohibitions, orders, restraints and other injunctions (other than
any of the foregoing that would reestablish the employment relation formerly
existing between Executive and the Company) that he or she may deem necessary
or advisable directed to or against any of the parties, including a direction or
order requiring specific performance of any covenant, agreement or provision of
this Agreement as a result of a breach or threatened breach thereof.  This agreement to arbitrate all disputes
between the parties includes, but is not limited to, claims under the Age
Discrimination in Employment Act, the Americans with Disabilities Act, the
Family and Medical Leave Act, Title VII of the Civil Rights Act of 1964, the
New York State Human Rights Law, class action claims, all common law claims and
any other federal, State or local law or regulation.  The cost of such arbitration shall be borne
equally by the parties unless otherwise directed by the arbitrator.  Any decision of the arbitrator shall be
final, binding and conclusive upon all of the parties hereto and said decision
may be entered as a final judgment in any court of competent jurisdiction.  With respect to the claims described in
Section 9 and to the extent that any claim is found not to be subject to
arbitration, such claims shall be decided either by the U.S. District Court or
the state court of general jurisdiction in and for the judicial district in
which Executive’s place of employment is located, by a judge sitting without a
jury, to ensure rapid adjudication of those claims and proper application of
existing law.

 

                11.           Governing Law; Severability.  This Agreement will be governed by, and
construed and enforced in accordance with, the laws of the State of New York,
without regard to the conflicts of laws principles thereof.  If any provision of this Agreement is
prohibited or unenforceable in any jurisdiction, then such provision will, as
to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction will not invalidate or
render unenforceable such provision in any other jurisdiction.

 

                12.           Notices.  Notices and other communications hereunder
will be in writing and will be delivered personally or sent by air courier or
first class certified or registered mail, return receipt requested and postage
prepaid, addressed as follows:

 

	
  if to the Company, to:

   

  Veeco
  Instruments Inc.

  100
  Sunnyside Boulevard

  Woodbury,
  New York 11797

  Attention:
  General Counsel

  	
   

  	
  if to the Executive, to:

  the last residential
  address of Executive known to the Company

  

 

All notices and other communications given to
any party hereto in accordance with the provisions of this Agreement will be
deemed to have been given on the date of delivery, if personally delivered; on
the business day after the date when sent, if sent by air courier; and on the
third business day after the date when sent, if sent by mail, in each case
addressed to such party as provided in this section or in accordance with the
latest unrevoked direction from such party.

 

11

 

                13.           Offset; Withholding.  The amount of severance pay provided under
this Agreement, if any, may serve to offset or reduce any severance,
termination or similar payments the Company may be required to pay Executive
under federal, state and local laws or any separate severance policy or plan of
the Company.  The Company is authorized
to withhold, or cause to be withheld, from any payment or benefit under this
Agreement the full amount of any applicable withholding taxes or other
applicable deductions.

 

                14.           IRC Section 409A.  The parties understand and agree that certain
payments contemplated by this Agreement, including severance pay, may be “deferred
compensation” for purposes of IRC Section 409A. 
Notwithstanding any provision of this Agreement to the contrary, any
payments constituting deferred compensation required to be made upon or in
respect of the Executive’s termination of employment hereunder shall not be
paid prior to six months after the Executive’s termination of employment, to
the extent necessary to comply with IRC Section 409A(2)(B)(i).  The Company shall identify in writing
delivered to the Executive any payments it reasonably determines are subject to
delay hereunder and shall promptly pay any such delayed payments, without
interest, at the conclusion of the applicable six month period (or, if later,
when scheduled to be paid under the terms of the Agreement).  No deferred compensation payable hereunder
shall be subject to acceleration or to any change in the specified time or
method of payment, except as otherwise provided under this Agreement and
consistent with IRC Section 409A.  In no
event shall the Company have any liability or obligation with respect to taxes
for which the Executive may become liable as a result of the application of IRC
Section 409A.

 

15.           Assignment; Successors.  This Agreement is personal to Executive and
Executive shall not assign or transfer this Agreement or any of his rights or
obligations hereunder.  The provisions
hereof will inure to the benefit of, and be binding upon, the respective heirs,
legal representatives and successors of Executive and each successor of the
Company, whether by merger, consolidation, transfer of all or substantially all
of its assets or otherwise.

 

                16.           Legal Fees.  The Company hereby agrees to pay the legal
fees and expenses of DLA Piper in connection with their representing Executive
in the negotiation and documentation of this Agreement (not to exceed
$5,000).  Such payment shall be made
before August 31, 2007.

 

                17.           Cooperation.  Following any termination of Executive’s
employment, Executive shall reasonably cooperate with the Company, at mutually
convenient times, in connection with (i) all matters relating to the completion
or transition of pending work on behalf of the Company, and (ii) any existing
or future internal or external investigation or litigation in which the Company
deems Executive’s cooperation necessary.

 

18.           Entire Agreement; Amendment; Waiver.  This Agreement contains the entire agreement
between the parties with respect to the subject matter hereof and supersedes
all prior agreements or understandings among the parties with respect thereto including the offer letter dated April 19,
2007.  This Agreement may be
amended or terminated only in a writing signed by the parties hereto.  The waiver by either party of a breach of any
provision of this Agreement by the other party must be in writing and will not
operate, or be construed as, a waiver of any subsequent breach by such other
party.

 

12

 

                19.           Headings.  The section headings contained in this
Agreement are for reference purposes only and will not affect in any way the meaning
or interpretation of this Agreement.

 

                20.           Effective Date. 
This Agreement shall become
effective on July 1, 2007.

*     *     *    
*     *

 

                IN
WITNESS WHEREOF, the parties have duly executed this Agreement as of the date
first above written.

 

	
  VEECO INSTRUMENTS INC. 

  	
  EXECUTIVE 

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
  John R. Peeler

  	
   

  
	
  Title:

  	
   

  
	
   

  	
  Position:

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  Initial Base Salary:

  	
  $600,000

  
	
   

  	
   

  	
   

  
	
   

  	
  Severance Period:

  	
  36 months

  
						

 

13

 

APPENDIX A

NOTICE OF RESTRICTED STOCK AWARD

 

 

VEECO
INSTRUMENTS INC.

NOTICE
OF RESTRICTED STOCK AWARD

                Veeco
Instruments Inc. (the “Company”), is pleased to confirm the award to the
employee named below (“Participant”) of restricted shares of common
stock, par value $0.01 per share, of the Company described below.

 

	
  Participant:

  	
   

  	
                                         

  
	
   

  	
   

  	
   

  
	
  Award Date:

  	
   

  	
                             ,
  2007

  
	
   

  	
   

  	
   

  
	
  Aggregate
  number of shares of Restricted

  Stock subject to the Award (the “Award”):

  	
   

  	
  

                           
  Shares

  
	
   

  	
   

  	
   

  
	
  Vesting/Lapsing
  of Restrictions:

  	
   

  	
  One-third of the shares
  comprising the Award will vest, and the restrictions with respect to such
  shares shall lapse, on each of first three anniversaries of the Award Date.

  
	
   

  	
   

  	
   

  
	
  Additional
  Provisions:

  	
   

  	
  This Award shall be
  subject to the terms and conditions set forth in the Veeco Instruments Inc.
  Terms and Conditions of Restricted Stock Award (2007) (the “Terms and
  Conditions”). Unless Participant notifies Veeco within 10 days following
  receipt of this notice that he or she declines this Award, Participant will
  be deemed to have accepted and agreed to the Terms and Conditions. Any such
  notice should be in writing and sent to Veeco Instruments Inc., Attention:
  General Counsel, 100 Sunnyside Boulevard, Suite B, Woodbury, NY 11797 or by
  facsimile to 516-677-0380.

  
	
   

  	
   

  
	
   

  	
   

  	
  VEECO INSTRUMENTS INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
						

 

A-1

 

VEECO INSTRUMENTS INC.

 

TERMS AND CONDITIONS OF RESTRICTED STOCK AWARD

(2007)

 

These TERMS AND CONDITIONS
OF RESTRICTED STOCK AWARD (2007) (these “Terms and Conditions”) apply to
any award by Veeco Instruments Inc., a Delaware corporation (the “Company”),
of the Company’s common stock, par value $0.01 per share (“Common Stock”),
subject to certain restrictions (“Restricted Stock”), pursuant to the
Veeco Instruments Inc. 2000 Stock Incentive Plan (as it may be amended from
time to time, the “Plan”), which specifically references these Terms and
Conditions.

ARTICLE 1.

DEFINITIONS

 

Section
1.1             In General.  Capitalized terms used but not defined herein
shall have the meanings assigned to such terms in the Plan and/or the
applicable Notice of Restricted Stock Award. 
In addition, wherever the following term is used in these Terms and
Conditions, it shall have the meaning specified below, unless the context
clearly indicates otherwise.

Section
1.2             “Restrictions”
shall mean the restrictions on sale or other transfer set forth in Section 4.2
and the exposure to forfeiture set forth in Section 3.1.

ARTICLE
2.

RESTRICTED STOCK  AWARD

Section
2.1             Award of
Restricted Stock.  The Award is made
in consideration of the Participant’s agreement to remain in the employ of the
Company and for other good and valuable consideration which the Committee has
determined exceeds the aggregate par value of the shares of Common Stock
subject to the Award.

Section
2.2             Award Subject to
Plan.  The Award is subject to the
terms and provisions of the Plan, including without limitation Section 8
thereof.

ARTICLE 3.

RESTRICTIONS

Section 3.1             Forfeiture.  Unless otherwise provided by written
agreement between the Company and Participant, which may be entered into at any
time, including in connection with the termination of Participant’s employment,
any shares of Restricted Stock which are not vested at the time Participant’s
employment with the Company or one of its Subsidiaries terminates shall
thereupon be forfeited immediately and without any further action by the
Company or the Participant.

 

A-2

 

Section 3.2             Vesting
and Lapse of Restrictions.  Subject
to Section 3.1, the Restrictions shall lapse with respect to the Restricted
Stock subject to the Award, and the Participant’s rights thereto shall vest, as
follows: 

	
  Date:

  	
   

  	
  Restrictions
  Shall

  Lapse with Respect to:

  
	
  First
  Anniversary of Award Date

  	
   

  	
  One-third
  of the Award

  
	
  Second
  Anniversary of Award Date

  	
   

  	
  One-third
  of the Award

  
	
  Third
  Anniversary of Award Date

  	
   

  	
  One-third
  of the Award

  

 

provided, in each case, that the Participant
remains continuously employed in active service from the Award Date through
such vesting date.

Section 3.3             Legend.  Until such time as the Restrictions have
lapsed, the Company may instruct the transfer agent for the Common Stock and/or
other record-keepers to include a restrictive code or similar notation in its
records (or legend on stock certificates, if any) to denote the Restrictions
and any applicable federal and/or state securities laws restrictions relating
to Restricted Stock.  The notation or
legend may include the following:

“THE SECURITIES
REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS SET FORTH IN THE
PLAN AND IN THE TERMS AND CONDITIONS APPLICABLE TO THE RESTRICTED STOCK AWARD,
COPIES OF WHICH ARE ON FILE AT THE PRINCIPAL OFFICE OF THE CORPORATION.”

Section 3.4             Payment
of Taxes; Issuance of Shares.

(a)                           Participant understands, acknowledges and
agrees that, unless a Section 83(b) election is made (as described in Section
3.6), the difference between the Fair Market Value of the Restricted Stock at
the time it vests, and the amount, if any, paid by the Participant for such
stock is subject to state and federal income taxes and Participant is
responsible for paying such taxes.

(b)                           If the Company is required to withhold any
such taxes, Participant hereby authorizes any brokerage firm determined
acceptable to the Company for such purposes to sell on Participant’s behalf a
whole number of shares from the number of vested shares of Restricted Stock
delivered to Participant at the time the Restrictions lapse to generate cash
proceeds sufficient to satisfy the tax withholding obligation, provided that no
such sale shall be made if such sale would violate any applicable securities
law.  The shares will be sold as soon as
practicable following the day the tax withholding obligation arises.  The Participant will be responsible for all
brokerage fees and other costs of sale and Participant agrees to indemnify and
hold the Company harmless from any losses, costs, damages, or expenses relating
to any such sale.  Participant
acknowledges that the Company or its designee is under no obligation to arrange
for such sale at any particular price, and that the proceeds of any such sale
may not be sufficient to satisfy Participant’s tax withholding obligation.  Accordingly, Participant agrees to pay to the
Company as soon as practicable any amount of the tax withholding obligation
that is not satisfied by the sale of shares described above.  The Company may, at its discretion, fulfill
its

 

A-3

 

tax withholding obligation
by reducing the number  of  vested  shares  of Restricted Stock delivered to Participant at the time the
Restrictions lapse by the number  of  shares  of  Restricted Stock required to satisfy such
tax withholding requirements (based on the Fair Market Value of shares at such
time).  Such shares of vested Restricted
Stock shall be returned to the Company. 
Participant’s acknowledgement and acceptance of these tax provisions are
conditions precedent to the right of Participant to receive the Restricted
Stock under the Plan and this Agreement.

(c)                           In lieu of the sale or reduction of shares
delivered described in paragraph (b) above, Participant may pay to the Company
the amount of tax required to be withheld in cash, by check or in other form
satisfactory to the Company.  Such
payment must be made by the date on which the Restrictions lapse or such later
date as is established by the Company (not to exceed 15 days after the date on
which the Restrictions lapse).

(d)                           The Shares will be deposited directly into
Participant’s brokerage account with the Company’s approved broker when vested
and any applicable withholding obligations have been satisfied.

Section 3.5             Certain Changes in Capitalization.  If the shares of the Company’s Common Stock
as a whole are increased, decreased, changed into or exchanged for a different
number or kind of shares or securities of the Company, whether through merger,
consolidation, reorganization, recapitalization, reclassification, stock
dividend, stock split, combination of shares, exchange of shares, change in
corporate structure or the like, the Committee, in its sole discretion, shall
have the discretion and power to determine and to make effective provision for
acceleration of the time or times at which any Restrictions shall lapse or be
removed.  In addition, in the case of the
occurrence of any event described in this Section 3.5, the Committee, subject
to the provisions of the Plan and these Terms and Conditions, shall make an
appropriate and proportionate adjustment in the number and kind of shares of
Restricted Stock, to the end that after such event the Participant’s
proportionate interest shall be maintained as before the occurrence of such
event.  Any such adjustment made by the
Committee shall be final and binding upon the Participant, the Company and all
other interested persons. In the event that the Participant receives any new or
additional or different shares or securities by reason of any transaction or
event described in this Section 3.5, such new or additional or different shares
or securities which are attributable to the Participant in his capacity as the
registered owner of the Restricted Stock then subject to Restrictions, shall be
considered to be Restricted Stock and shall be subject to all of the
Restrictions.

Section 3.6             Section 83(b) Election.  Participant understands that, under
Section 83(a) of the Internal Revenue Code of 1986, as amended (the “Code”),
the Participant will recognize as ordinary income the difference between the
amount, if any, paid for the shares of Common Stock and the Fair Market Value
of such shares at the time the Restrictions on such shares lapse.  Participant understands that, notwithstanding
the preceding sentence, Participant may elect to be taxed at the time of the
Award Date, rather that at the time the Restrictions lapse, by filing an
election under Section 83(b) of the Code (an “83(b) Election”) with
the Internal Revenue Service within 30 days of the Award Date. In the event
Participant files an 83(b) Election, Participant will recognize ordinary income
in an amount equal to the difference between the amount, if any, paid for the
shares of Common Stock and the Fair Market Value of such shares as of the Award
Date, and will be responsible for paying all such taxes, and, if

 

A-4

 

applicable, paying the
Company the amount of any tax required to be withheld thereon at the time of
such election, in the manner set forth in Section 3.4.  Participant further understands that a copy
of such 83(b) Election form must be filed with his or her federal income tax
return for the calendar year in which the Award falls, and a copy delivered to
the Company.  Participant acknowledges
that the foregoing is only a summary of the effect of United States federal
income taxation with respect to the award of Restricted Stock hereunder, and
does not purport to be complete or to deal with any state local, or foreign tax
requirements that might apply.  PARTICIPANT
FURTHER ACKNOWLEDGES THAT THE COMPANY IS NOT RESPONSIBLE FOR FILING THE
PARTICIPANT’S 83(b) ELECTION, AND THE COMPANY HAS DIRECTED PARTICIPANT TO SEEK
INDEPENDENT ADVICE REGARDING THE APPLICABLE PROVISIONS OF THE CODE, THE INCOME
TAX LAWS OF ANY MUNICIPALITY, STATE OR FEDERAL GOVERNMENT OR FOREIGN COUNTRY IN
WHICH PARTICIPANT MAY RESIDE, AND THE TAX CONSEQUENCES OF PARTICIPANT’S DEATH.

ARTICLE
4.

OTHER PROVISIONS

Section 4.1             Book
Entry; Escrow.  The Shares
representing the Restricted Stock will be held in book-entry or global
certificate form.  If the Company instead
chooses to issue share certificates representing the Restricted Stock, the
certificates for the Restricted Stock shall be deposited in escrow with the
Secretary or Assistant Secretary of the Company or such other escrow holder as
the Company may appoint; provided, however,
that in no event shall the Participant retain physical custody of any
certificates representing unvested Restricted Stock issued to him.  The deposited certificates shall remain in
escrow until all of the Restrictions lapse or shall have been removed.

Section
4.2             Restricted Stock
Not Transferable.  No Restricted
Stock or any interest or right therein or part thereof shall be liable for the
debts, contracts or engagements of the Participant or his successors in
interest or shall be subject to disposition by transfer, alienation,
anticipation, pledge, encumbrance, assignment or any other means whether such
disposition be voluntary or involuntary or by operation of law by judgment,
levy, attachment, garnishment or any other legal or equitable proceedings
(including bankruptcy), and any attempted disposition thereof shall be null and
void and of no effect; provided, however,
that this Section 4.2 shall not prevent transfers by will or by applicable laws
of descent and distribution.

Section 4.3             Rights as Stockholder.  Except as otherwise provided herein, upon
issuance of the shares of Restricted Stock pursuant to Section 4.1, the
Participant shall have all the rights of a stockholder with respect to said
shares, subject to the Restrictions herein, including the right to vote the
shares and to receive all dividends or other distributions paid or made with
respect to the shares or Restricted Stock; provided, however, that any and all shares of Common Stock received by the Participant
with respect to such Restricted Stock as a result of stock dividends, stock
splits or any other form of recapitalization shall also be subject to the
Restrictions until the Restrictions on the underlying shares of Restricted
Stock lapse or are removed pursuant to these Terms and Conditions.

Section
4.4             No Right to
Continued Employment.  Nothing in
these Terms and Conditions or in the Plan shall confer upon the Participant any
right to continue in the employ of

 

A-5

 

the Company or any of its
Subsidiaries or shall interfere with or restrict in any way the rights of the
Company or its Subsidiaries, which are hereby expressly reserved, to discharge
the Participant at any time for any reason whatsoever, with or without cause,
except as may otherwise be provided by any written agreement entered into by
and between the Company and the Participant.

Section 4.5             Governing Law.  
The laws of the State of Delaware shall govern the interpretation,
validity, administration, enforcement and performance of the terms of these
Terms and Conditions regardless of the law that might be applied under
principles of conflicts of laws.

Section
4.6             Conformity to
Securities Laws.  The Participant
acknowledges that the Plan and these Terms and Conditions are intended to
conform to the extent necessary with all provisions of the Securities Act of
1933, as amended, and the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), and any and all regulations and rules promulgated thereunder by the
Securities and Exchange Commission, including without limitation Rule 16b-3
under the Exchange Act.  Notwithstanding
anything herein to the contrary, the Plan shall be administered, and the Awards
are granted, only in such a manner as to conform to such laws, rules and
regulations.  To the extent permitted by
applicable law, the Plan and these Terms and Conditions shall be deemed amended
to the extent necessary to conform to such laws, rules and regulations.

Section
4.7             Amendment,
Suspension and Termination.  The
Award and these Terms and Conditions may be wholly or partially amended or
otherwise modified, suspended or terminated at any time or from time to time by
the Committee or the Board, provided
that, except as may otherwise be provided by the Plan, neither the amendment,
suspension nor termination of the Award or these Terms and Conditions shall,
without the consent of the Participant, alter or impair any rights or
obligations under any Award.

Section
4.8             Notices.  Notices required or permitted hereunder shall
be given in writing and shall be deemed effectively given upon personal
delivery or upon deposit in the United States mail by certified mail, with
postage and fees prepaid, addressed to the Participant to his address shown in
the Company records, and to the Company at its principal executive office.

Section
4.9             Severability.
The invalidity or unenforceability of any paragraph or provision of these Terms
and Conditions shall not affect the validity or enforceability of any other
paragraph or provision, and all other provisions shall remain in full force and
effect.  If any provision of these Terms
and Conditions is held to be excessively broad, then such provision shall be
reformed and construed by limiting and reducing it so as to be enforceable to
the maximum extent permitted by law.

Section
4.10           Certain Provisions
Applicable to Participants Employed at International Locations.  The Company will assess its requirements
regarding tax, social insurance and any other payroll tax (“Tax-Related
Items”) withholding and reporting in connection with the shares of
Restricted Stock.  These requirements may
change from time to time as laws or interpretations change.  Regardless of the actions of the Company in
this regard, Participant hereby acknowledges and agrees that the ultimate
liability for any and all Tax-

 

A-6

 

Related Items is and remains
his or her responsibility and liability and that the Company makes no
representations nor undertakings regarding treatment of any Tax-Related Items
in connection with any aspect of the grant of Restricted Stock and does not
commit to structure the terms of the grant or any aspect of the Restricted
Stock to reduce or eliminate the Participant’s liability regarding Tax-Related
Items.  In the event that the Company
must withhold any Tax-Related Items as a result of the grant or vesting of the
Restricted Stock, Participant agrees to make arrangements satisfactory to the
Company to satisfy all withholding requirements.  Participant authorizes the Company to
withhold all applicable Tax-Related Items legally due from the Participant from
his or her wages or other cash compensation paid him or her by the Company
and/or to cause the sale of vested shares of Restricted Stock on Participant’s
behalf or reduce the number of vested shares of Restricted Stock delivered to
Participant at the time the restrictions lapse, as contemplated by Section 3.4
above, to satisfy such Tax-Related Items.

Section
4.11           Data Privacy.  Participant consents to the
collection, use and transfer of personal data as described in this
Section.  Participant understands that
the Company and its Subsidiaries hold certain personal information about the Participant,
including the Participant’s name, home address and telephone number, date of
birth, social security number or identification number, salary, nationality,
job title, any shares of stock or directorships held in the Company, details of
all options or any other entitlement to shares of stock (restricted or
otherwise) awarded, cancelled, exercised, vested, unvested or outstanding in
Participant’s favor, for the purpose of managing and administering the Plan (“Data”).  Participant further understands that the
Company and/or its Subsidiaries will transfer Data amongst themselves as
necessary for the purpose of implementation, administration and management of
Participant’s participation in the Plan, and that the Company and/or any of its
Subsidiaries may each further transfer Data to any third parties assisting the
Company in the implementation, administration and management of the Plan (“Data
Recipients”).  Participant
understands that these Data Recipients may be located in the Participant’s
country of residence, the European Economic Area, or elsewhere throughout the
world, such as the United States. 
Participant authorizes the Data Recipients to receive, possess, use,
retain and transfer the Data, in electronic or other form, for the purposes of
implementing, administering and managing Participant’s participation in the
Plan, including any transfer of such Data, as may be required for the
administration of the Plan and/or the subsequent holding of shares on the
Participant’s behalf, to a broker or other third party with whom Participant
may elect to deposit any shares of stock acquired upon vesting of the shares of
Restricted Stock.  Participant
understands that he or she may, at any time, review the Data, require any
necessary amendments to it or withdraw the consent herein in writing by
contacting the Company.  Withdrawal of
consent may, however, affect Participant’s ability to participate in the Plan.

*     *     *    
*     *

 

A-7

 

APPENDIX B 

INVENTIONS PRIOR TO EMPLOYMENT WITH EMPLOYER

 

	
  Brief Description of Inventions (1)

  	
   

  	
  Right,
  Title or Interest

  and Date Acquired

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

(1)             “None” unless otherwise indicated.

 

B-1Exhibit
10.70

EXECUTION
COPY

REVOLVING
CREDIT AGREEMENT

dated as
of August 1, 2007

among

SOURCE
INTERLINK COMPANIES, INC.,

as the
Borrower,

CERTAIN
SUBSIDIARIES OF THE BORROWER,

as
Guarantors,

VARIOUS
LENDERS,

CITIGROUP
GLOBAL MARKETS INC.

and

J.P.
MORGAN SECURITIES INC.,

as Joint
Lead Arrangers and Joint Book Runners,

CITICORP
NORTH AMERICA, INC.,

as
Administrative Agent and Collateral Agent,

and

JPMORGAN
CHASE BANK, N.A.,

as
Syndication Agent

and

WACHOVIA
BANK, NATIONAL ASSOCIATION

and

WELLS
FARGO FOOTHILL, LLC

as
Co-Documentation Agents

$300,000,000
Senior Secured Revolving Credit Facility

TABLE
OF CONTENTS

	
  

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 1.

  	
   

  	
  DEFINITIONS AND INTERPRETATION

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.1

  	
   

  	
  Definitions

  	
   

  	
  1

  
	
  1.2

  	
   

  	
  Accounting Terms

  	
   

  	
  42

  
	
  1.3

  	
   

  	
  Interpretation,
  etc.

  	
   

  	
  43

  
	
  1.4

  	
   

  	
  Conversion of
  Foreign Currencies

  	
   

  	
  43

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 2.

  	
   

  	
  LOANS AND
  LETTERS OF CREDIT

  	
   

  	
  44

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.1

  	
   

  	
  Revolving Loans;
  Protective Advances

  	
   

  	
  44

  
	
  2.2

  	
   

  	
  Swing Line Loans

  	
   

  	
  46

  
	
  2.3

  	
   

  	
  Issuance of
  Letters of Credit and Purchase of Participations Therein

  	
   

  	
  47

  
	
  2.4

  	
   

  	
  Pro Rata Shares

  	
   

  	
  52

  
	
  2.5

  	
   

  	
  Use of Proceeds

  	
   

  	
  52

  
	
  2.6

  	
   

  	
  Repayment of
  Loans; Evidence of Debt; Register; Lenders’ Books and Records; Notes

  	
   

  	
  52

  
	
  2.7

  	
   

  	
  Interest on
  Loans

  	
   

  	
  53

  
	
  2.8

  	
   

  	
  Conversion/Continuation

  	
   

  	
  55

  
	
  2.9

  	
   

  	
  Default Interest

  	
   

  	
  55

  
	
  2.10

  	
   

  	
  Fees

  	
   

  	
  56

  
	
  2.11

  	
   

  	
  Voluntary
  Prepayments

  	
   

  	
  57

  
	
  2.12

  	
   

  	
  Voluntary
  Revolving Commitment Reductions

  	
   

  	
  57

  
	
  2.13

  	
   

  	
  Mandatory
  Prepayments

  	
   

  	
  57

  
	
  2.14

  	
   

  	
  Application of
  Prepayments

  	
   

  	
  58

  
	
  2.15

  	
   

  	
  General
  Provisions Regarding Payments

  	
   

  	
  59

  
	
  2.16

  	
   

  	
  Ratable Sharing

  	
   

  	
  61

  
	
  2.17

  	
   

  	
  Making or
  Maintaining Eurodollar Rate Loans

  	
   

  	
  62

  
	
  2.18

  	
   

  	
  Increased Costs;
  Capital Adequacy

  	
   

  	
  63

  
	
  2.19

  	
   

  	
  Taxes;
  Withholding, etc.

  	
   

  	
  64

  
	
  2.20

  	
   

  	
  Obligation to
  Mitigate

  	
   

  	
  66

  
	
  2.21

  	
   

  	
  Defaulting
  Lenders

  	
   

  	
  67

  
	
  2.22

  	
   

  	
  Removal or
  Replacement of a Lender

  	
   

  	
  67

  
	
  2.23

  	
   

  	
  Reserves

  	
   

  	
  68

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3.

  	
   

  	
  CONDITIONS
  PRECEDENT

  	
   

  	
  68

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.1

  	
   

  	
  Closing Date

  	
   

  	
  68

  
	
  3.2

  	
   

  	
  Conditions
  Precedent to Each Credit Extension

  	
   

  	
  73

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4.

  	
   

  	
  REPRESENTATIONS
  AND WARRANTIES

  	
   

  	
  74

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.1

  	
   

  	
  Organization;
  Requisite Power and Authority; Qualification

  	
   

  	
  74

  
	
  4.2

  	
   

  	
  Capital Stock
  and Ownership

  	
   

  	
  74

  
	
  4.3

  	
   

  	
  Due
  Authorization

  	
   

  	
  75

  
	
  4.4

  	
   

  	
  No Conflict

  	
   

  	
  75

  
	
  4.5

  	
   

  	
  Governmental
  Consents

  	
   

  	
  75

  

 

 i
 

 

	
  

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.6

  	
   

  	
  Binding
  Obligation

  	
   

  	
  75

  
	
  4.7

  	
   

  	
  Historical
  Financial Statements

  	
   

  	
  75

  
	
  4.8

  	
   

  	
  Projections

  	
   

  	
  76

  
	
  4.9

  	
   

  	
  No Material
  Adverse Change

  	
   

  	
  76

  
	
  4.10

  	
   

  	
  Insurance

  	
   

  	
  76

  
	
  4.11

  	
   

  	
  Compliance with
  Laws; Adverse Proceedings, etc.

  	
   

  	
  76

  
	
  4.12

  	
   

  	
  Payment of Taxes

  	
   

  	
  76

  
	
  4.13

  	
   

  	
  Properties

  	
   

  	
  76

  
	
  4.14

  	
   

  	
  Environmental
  Matters

  	
   

  	
  77

  
	
  4.15

  	
   

  	
  No Defaults

  	
   

  	
  78

  
	
  4.16

  	
   

  	
  Governmental
  Regulation

  	
   

  	
  78

  
	
  4.17

  	
   

  	
  Margin Stock

  	
   

  	
  78

  
	
  4.18

  	
   

  	
  Labor Matters

  	
   

  	
  78

  
	
  4.19

  	
   

  	
  ERISA Matters

  	
   

  	
  78

  
	
  4.20

  	
   

  	
  Solvency

  	
   

  	
  79

  
	
  4.21

  	
   

  	
  Intellectual
  Property

  	
   

  	
  79

  
	
  4.22

  	
   

  	
  Status as Senior
  Debt

  	
   

  	
  79

  
	
  4.23

  	
   

  	
  Disclosure

  	
   

  	
  79

  
	
  4.24

  	
   

  	
  Use of Proceeds

  	
   

  	
  79

  
	
  4.25

  	
   

  	
  Perfection of
  Security Interests

  	
   

  	
  80

  
	
  4.26

  	
   

  	
  Purchase
  Documents; Representations and Warranties in Acquisition Agreement

  	
   

  	
  80

  
	
  4.27

  	
   

  	
  Anti-Terrorism
  Law

  	
   

  	
  81

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5.

  	
   

  	
  AFFIRMATIVE
  COVENANTS

  	
   

  	
  81

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.1

  	
   

  	
  Financial
  Statements and Other Reports

  	
   

  	
  82

  
	
  5.2

  	
   

  	
  Existence

  	
   

  	
  86

  
	
  5.3

  	
   

  	
  Payment of Taxes
  and Claims

  	
   

  	
  86

  
	
  5.4

  	
   

  	
  Maintenance of
  Properties

  	
   

  	
  86

  
	
  5.5

  	
   

  	
  Insurance

  	
   

  	
  86

  
	
  5.6

  	
   

  	
  Inspections

  	
   

  	
  87

  
	
  5.7

  	
   

  	
  Lenders Meetings

  	
   

  	
  87

  
	
  5.8

  	
   

  	
  Compliance with
  Laws

  	
   

  	
  87

  
	
  5.9

  	
   

  	
  Field
  Examinations; Collateral Appraisals

  	
   

  	
  87

  
	
  5.10

  	
   

  	
  Environmental
  Matters; Hazardous Activities, etc

  	
   

  	
  88

  
	
  5.11

  	
   

  	
  Subsidiaries

  	
   

  	
  88

  
	
  5.12

  	
   

  	
  Additional
  Material Real Estate Assets

  	
   

  	
  88

  
	
  5.13

  	
   

  	
  Further
  Assurances

  	
   

  	
  89

  
	
  5.14

  	
   

  	
  Books

  	
   

  	
  89

  
	
  5.15

  	
   

  	
  Cash Management

  	
   

  	
  89

  
	
  5.16

  	
   

  	
  Landlord Waivers
  and Bailee’s Letters

  	
   

  	
  91

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6.

  	
   

  	
  NEGATIVE
  COVENANTS

  	
   

  	
  91

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.1

  	
   

  	
  Indebtedness

  	
   

  	
  91

  
	
  6.2

  	
   

  	
  Liens

  	
   

  	
  93

  
	
  6.3

  	
   

  	
  [Reserved]

  	
   

  	
  94

  
	
  6.4

  	
   

  	
  Restricted
  Junior Payments

  	
   

  	
  95

  
	
  6.5

  	
   

  	
  Restrictions on
  Subsidiary Distributions

  	
   

  	
  95

  

 

 ii
 

 

	
  

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.6

  	
   

  	
  Investments

  	
   

  	
  95

  
	
  6.7

  	
   

  	
  [Reserved]

  	
   

  	
  96

  
	
  6.8

  	
   

  	
  Fundamental
  Changes; Disposition of Assets; Acquisitions

  	
   

  	
  96

  
	
  6.9

  	
   

  	
  Disposal of
  Subsidiary Interests

  	
   

  	
  97

  
	
  6.10

  	
   

  	
  Sales and Lease-Backs

  	
   

  	
  98

  
	
  6.11

  	
   

  	
  Transactions
  with Shareholders and Affiliates

  	
   

  	
  98

  
	
  6.12

  	
   

  	
  Conduct of
  Business

  	
   

  	
  98

  
	
  6.13

  	
   

  	
  Limitation on
  Issuance of Subsidiary Capital Stock

  	
   

  	
  98

  
	
  6.14

  	
   

  	
  Prepayments of
  Other Indebtedness; Modifications of Organizational Documents and Other
  Documents, etc.

  	
   

  	
  98

  
	
  6.15

  	
   

  	
  Accounting
  Changes; Fiscal Year

  	
   

  	
  99

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 7.

  	
   

  	
  GUARANTY

  	
   

  	
  99

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.1

  	
   

  	
  Guaranty of the
  Obligations

  	
   

  	
  99

  
	
  7.2

  	
   

  	
  Limitation of
  Guaranty

  	
   

  	
  100

  
	
  7.3

  	
   

  	
  Contribution

  	
   

  	
  100

  
	
  7.4

  	
   

  	
  Liability of
  Guarantors Absolute

  	
   

  	
  100

  
	
  7.5

  	
   

  	
  Waivers by
  Guarantors

  	
   

  	
  102

  
	
  7.6

  	
   

  	
  Guarantors’
  Rights of Subrogation, Contribution, etc.

  	
   

  	
  102

  
	
  7.7

  	
   

  	
  Subordination of
  Other Obligations

  	
   

  	
  103

  
	
  7.8

  	
   

  	
  Continuing
  Guaranty

  	
   

  	
  103

  
	
  7.9

  	
   

  	
  Authority of
  Guarantors

  	
   

  	
  103

  
	
  7.10

  	
   

  	
  Financial
  Condition of the Borrower

  	
   

  	
  103

  
	
  7.11

  	
   

  	
  Default;
  Remedies

  	
   

  	
  104

  
	
  7.12

  	
   

  	
  Bankruptcy, etc.

  	
   

  	
  104

  
	
  7.13

  	
   

  	
  Waiver of
  Judicial Bond

  	
   

  	
  105

  
	
  7.14

  	
   

  	
  Discharge of
  Guaranty upon Sale of Guarantor

  	
   

  	
  105

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 8.

  	
   

  	
  EVENTS OF
  DEFAULT

  	
   

  	
  105

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.1

  	
   

  	
  Events of
  Default

  	
   

  	
  105

  
	
  8.2

  	
   

  	
  Actions in
  Respect of Letters of Credit

  	
   

  	
  108

  
	
  8.3

  	
   

  	
  Rescission

  	
   

  	
  108

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 9.

  	
   

  	
  AGENTS

  	
   

  	
  109

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.1

  	
   

  	
  Appointment of
  Agents; Authorization

  	
   

  	
  109

  
	
  9.2

  	
   

  	
  Powers and
  Duties

  	
   

  	
  109

  
	
  9.3

  	
   

  	
  General Immunity

  	
   

  	
  109

  
	
  9.4

  	
   

  	
  Facility Agents
  Entitled to Act as Lenders

  	
   

  	
  111

  
	
  9.5

  	
   

  	
  Representations,
  Warranties and Acknowledgment by Lenders and Issuing Banks

  	
   

  	
  111

  
	
  9.6

  	
   

  	
  Right to
  Indemnity

  	
   

  	
  111

  
	
  9.7

  	
   

  	
  Successor
  Facility Agents and Swing Line Lender

  	
   

  	
  112

  
	
  9.8

  	
   

  	
  Collateral
  Documents and Guaranty

  	
   

  	
  113

  
	
  9.9

  	
   

  	
  Approved
  Electronic Communications

  	
   

  	
  115

  
	
  9.10

  	
   

  	
  Collateral
  Matters Relating to Related Obligations

  	
   

  	
  116

  
	
  9.11

  	
   

  	
  Withholding
  Taxes

  	
   

  	
  116

  

 

 iii
 

 

	
  

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 10.

  	
   

  	
  MISCELLANEOUS

  	
   

  	
  117

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.1

  	
   

  	
  Notices

  	
   

  	
  117

  
	
  10.2

  	
   

  	
  Expenses

  	
   

  	
  117

  
	
  10.3

  	
   

  	
  Indemnity

  	
   

  	
  118

  
	
  10.4

  	
   

  	
  Set-Off

  	
   

  	
  119

  
	
  10.5

  	
   

  	
  Amendments and
  Waivers

  	
   

  	
  119

  
	
  10.6

  	
   

  	
  Successors and
  Assigns; Participations

  	
   

  	
  121

  
	
  10.7

  	
   

  	
  Independence of
  Covenants

  	
   

  	
  124

  
	
  10.8

  	
   

  	
  Survival of
  Representations, Warranties and Agreements

  	
   

  	
  124

  
	
  10.9

  	
   

  	
  No Waiver;
  Remedies Cumulative

  	
   

  	
  124

  
	
  10.10

  	
   

  	
  Marshalling;
  Payments Set Aside

  	
   

  	
  124

  
	
  10.11

  	
   

  	
  Severability

  	
   

  	
  124

  
	
  10.12

  	
   

  	
  Obligations
  Several; Independent Nature of Lenders’ Rights

  	
   

  	
  125

  
	
  10.13

  	
   

  	
  Headings

  	
   

  	
  125

  
	
  10.14

  	
   

  	
  GOVERNING LAW

  	
   

  	
  125

  
	
  10.15

  	
   

  	
  Consent to
  Jurisdiction; Service of Process

  	
   

  	
  125

  
	
  10.16

  	
   

  	
  WAIVER OF JURY
  TRIAL

  	
   

  	
  125

  
	
  10.17

  	
   

  	
  Confidentiality

  	
   

  	
  126

  
	
  10.18

  	
   

  	
  Entire Agreement

  	
   

  	
  126

  
	
  10.19

  	
   

  	
  Counterparts

  	
   

  	
  126

  
	
  10.20

  	
   

  	
  Effectiveness

  	
   

  	
  127

  
	
  10.21

  	
   

  	
  Patriot Act

  	
   

  	
  127

  
	
  10.22

  	
   

  	
  Electronic Execution
  of Assignments

  	
   

  	
  127

  
	
  10.23

  	
   

  	
  Reinstatement

  	
   

  	
  127

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  APPENDICES:

  	
   

  	
  A

  	
  Revolving Commitments

  	
   

  	
   

  
	
   

  	
   

  	
  B

  	
  Notice Addresses

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULES:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  1.1(a)

  	
  Closed Accounts

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  1.1(b)

  	
  Certain Acquisitions

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  1.1(d)

  	
  Refinanced Indebtedness

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  1.1(f)

  	
  Guarantors

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  1.1(g)

  	
  Leasehold Property

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  1.1(h)

  	
  Designated Accounts

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  2.3(k)

  	
  Existing Letters of Credit

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  3.1(h)

  	
  Closing Date Mortgaged Properties

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  3.1(s)

  	
  Vendors

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  4.1

  	
  Jurisdictions of Organization and Qualification

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  4.2

  	
  Capital Stock and Ownership

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  4.26

  	
  Purchase Documents

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  5.15(a)

  	
  Approved Deposit Accounts

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  5.17

  	
  Post Closing Collateral Matters

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  6.1

  	
  Certain Indebtedness

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  6.2

  	
  Certain Liens

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  6.6

  	
  Certain Investments

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  6.11

  	
  Certain Affiliate Transactions

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EXHIBITS:

  	
   

  	
   

  	
  A-1

  	
  Funding Notice

  	
   

  	
   

  
										

 

 iv
 

 

	
  

  	
   

  	
   

  	
  A-2

  	
  Conversion/Continuation Notice

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  A-3

  	
  Issuance Notice

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  A-4

  	
  Swing Line Request

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  B-1

  	
  Revolving Loan Note

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  B-2

  	
  Swing Line Note

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  C

  	
  Compliance Certificate

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  D

  	
  Opinions of Counsel

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  E

  	
  Assignment Agreement

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  F

  	
  Certificate Re Non-bank Status

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  G-1

  	
  Closing Date Certificate

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  G-2

  	
  Solvency Certificate

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  H

  	
  Counterpart Agreement

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  I

  	
  Pledge and Security Agreement

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  J

  	
  Mortgage

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  K

  	
  Landlord Access Agreement

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  L

  	
  Bailee’s Letter

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  M

  	
  Borrowing Base Certificate

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  N

  	
  Intercreditor Agreement

  	
   

  	
   

  

 

 v

 

REVOLVING
CREDIT AGREEMENT

This REVOLVING CREDIT AGREEMENT, dated as of
August 1, 2007, is entered into by and among SOURCE
INTERLINK COMPANIES, INC., a Delaware corporation (the “Borrower”),
the Guarantors party hereto, the Lenders party hereto from time to time, CITICORP NORTH AMERICA,
INC. (“CNAI”), as
Administrative Agent (together with its permitted successors in such capacity,
the “Administrative
Agent”) and as Collateral Agent (together with its permitted
successors in such capacity, the “Collateral Agent”), JPMORGAN CHASE BANK, N.A., as Syndication Agent (together
with its permitted successors in such capacity, the “Syndication
Agent”) and WACHOVIA BANK, NATIONAL
ASSOCIATION and WELLS FARGO FOOTHILL,
LLC, as  Co-Documentation
Agents  (together with their respective
permitted successors, in such capacity, the “Co-Documentation Agents”).

RECITALS:

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

WHEREAS, the Lenders have agreed
to extend a revolving credit facility to the Borrower, in an aggregate amount
not to exceed $300,000,000, the proceeds of which will be used after the
Closing Date to finance the ongoing working capital requirements of the Borrower
and its Subsidiaries (including Permitted Acquisitions and other Investments
permitted hereunder);

WHEREAS, the Borrower has agreed
to secure all of its Obligations by granting to the Collateral Agent, for the
benefit of the Secured Parties, a First Priority Lien on the Current Asset
Collateral and a Second Priority Lien on the Fixed Asset Collateral; and

WHEREAS, the Guarantors have
agreed to guarantee the obligations of the Borrower hereunder and to secure
their respective Obligations by granting to the Collateral Agent, for the
benefit of the Secured Parties, a First Priority Lien on the Current Asset
Collateral and a Second Priority Lien on the Fixed Asset Collateral.

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

SECTION
1.                                      DEFINITIONS
AND INTERPRETATION

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

“Acceptable Appraiser”
means (a) Great American Group, or (b) if (i) Great American Group is unable or
unwilling to perform the appraisals of Inventory required under this Agreement,
or (ii) the Administrative Agent otherwise determines in its Permitted Discretion
(in consultation with the Borrower) that Great American Group, or the
methodology used by Great American Group, is no longer reasonably acceptable,
then such other appraiser reasonably acceptable to the Administrative Agent and
the Borrower.

“Account Debtor”
as defined in the UCC.

“Accounts” as defined in the UCC.

“Acquired Business” means Enthusiast Media and its
Subsidiaries.

“Acquired Indebtedness” means (a) with respect to any Person,
Indebtedness existing at the time such Person becomes a Subsidiary of the
Borrower or (b) Indebtedness assumed by the Borrower or a Subsidiary in a
Permitted Acquisition; provided, that such Indebtedness (i) is unsecured
or secured only by collateral of such Person granted prior to the consummation
of any such Permitted Acquisition and (ii) was not incurred in anticipation of
such Permitted Acquisition.

“Acquisition” means any acquisition, whether by
purchase, merger or otherwise, of all or substantially all of the assets of,
all or substantially all of the Capital Stock of, or a business line or unit or
a division of, any Person.

“Acquisition Agreement” means that certain Stock Purchase
Agreement, dated as of May 13, 2007, by and among PRIMEDIA Inc., Seller and the
Borrower, together with all disclosure schedules and exhibits thereto.

“Acquisition Consideration”
shall mean the purchase consideration for any Permitted Acquisition including
all other payments by the Borrower or any of its Subsidiaries of purchase
consideration in exchange for, or as part of, or in connection with, any
Permitted Acquisition, whether paid in cash or by exchange of Capital Stock or
of properties or otherwise and whether payable at or prior to the consummation
of such Permitted Acquisition or deferred for payment at any future time, whether
or not any such future payment is subject to the occurrence of any contingency,
and includes any and all payments representing the purchase price and any
assumptions of Indebtedness, “earn-outs” and other agreements to make any
payment the amount of which is, or the terms of payment of which are, in any
respect subject to or contingent upon the revenues, income, cash flow or
profits (or the like) of any person or business; provided
that any such future payment that is subject to a contingency shall be considered
Acquisition Consideration only to the extent of the reserve, if any, required
under GAAP at any time by the Borrower or any of its Subsidiaries, or if
greater, the amount actually paid in cash in respect of such contingency.

 “Acquisition
Documents” means the collective reference to the Acquisition
Agreement and the agreements, certificates, instruments and other documents
required to be delivered in connection with the consummation of the
transactions contemplated by the Acquisition Agreement.

“Administrative Agent” as defined in the preamble
hereto.

“Adverse Proceeding” means any action, suit, proceeding
(whether administrative, judicial or otherwise), governmental investigation or
arbitration (whether or not purportedly on behalf of the Borrower or any of its
Subsidiaries) at law or in equity, or before or by any Governmental Authority,
domestic or foreign (including any Environmental Claims), whether pending or,
to the knowledge of the Borrower or any of its Subsidiaries, threatened against
or affecting the Borrower or any of its Subsidiaries or any property of the Borrower
or any of its Subsidiaries.

“Affected Lender” as defined in Section 2.17(c).

“Affected Loans” as defined in Section 2.17(c).

“Affiliate” means, as applied to any Person, any other
Person directly or indirectly controlling, controlled by, or under common
control with, that Person.  For the
purposes of this definition, “control” (including, with correlative meanings,
the terms “controlling,” “controlled by” and “under common control 

 2
 

with”), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of that Person, whether through the
ownership of voting securities or by contract or otherwise.

“After-Acquired Mortgaged Property” as defined in Section 5.12.

“Agent” means each of the Administrative Agent and the
Collateral Agent.

“Agent Affiliates”
as defined in Section 9.9(c).

“Aggregate Amounts Due” as defined in Section 2.16.

“Agreement” means this Revolving Credit Agreement, as it
may be amended, supplemented or otherwise modified from time to time in
accordance with its terms.

“Applicable Margin” means (i) with respect to
Revolving Loans that are Eurodollar Rate Loans, a percentage, per annum, equal
to 1.50% and (ii) with respect to Swing Line Loans and Revolving Loans that are
Base Rate Loans, a percentage, per annum, equal to 0.50%.

“Applicable Revolving Commitment Fee Percentage” means a
percentage, per annum, equal to 0.375%.

“Appraised Value” means the “Going Out of Business” value of
any Inventory, determined by the most recent appraisal performed by an
Acceptable Appraiser, which appraisal is in form and substance satisfactory to
the Administrative Agent (it being agreed that the methodology used by Great
American Group as of the Closing Date is acceptable).

“Approved Counterparty” means each Agent, Lender or any
Affiliate of an Agent or a Lender party to a Related Obligation Document
(including any Person who is an Agent or a Lender (and any Affiliate thereof)
(or an Agent, Lender or any Affiliate of a Facility Agent or a Lender (and any
Affiliate thereof)  under the Term Loan
Agreement) as of the Closing Date but subsequently, whether before or after
entering into a Related Obligation Document, ceases to be an Agent or a Lender)
including, without limitation, each such Affiliate that enters into a joinder
agreement with the Collateral Agent.

“Approved Currency”
means dollars, Canadian dollars, Australian dollars, euros and British Sterling.

“Approved Deposit Account”
means a Deposit Account that is the subject of an effective Deposit Account
Control Agreement and that is maintained by any Credit Party with a Deposit
Account Bank.  “Approved Deposit Account”
includes all monies on deposit in a Deposit Account and all certificates and
instruments, if any, representing or evidencing such Deposit Account.

“Approved Electronic
Communications” means each notice, demand, communication, information,
document and other material that any Credit Party is obligated to, or otherwise
chooses to, provide to any Agent pursuant to any Credit Document or the
transactions contemplated therein, including (a) any supplement to the
Guaranty, any joinder to the Pledge and Security Agreement and any other written
Contractual Obligation delivered or required to be delivered in respect of any
Credit Document or the transactions contemplated therein and (b) any financial
statement, financial and other report, notice, request, certificate and other
information material; provided, however, that “Approved
Electronic Communication” shall exclude (i) any Notice, and any other notice,
demand, communication, information, document and other material relating to a
request for a new, or a conversion of an existing, Borrowing or 

 3
 

Credit Extension, (ii) any notice pursuant to Sections
2.11, 2.12 and 2.13 and any other notice relating to the payment of any
principal or other amount due under any Credit Document prior to the scheduled
date therefor, (iii) all notices of any Default or Event of Default and (iv)
any notice, demand, communication, information, document and other material
required to be delivered to satisfy any of the conditions set forth in Section
3 or Section 2.3(b) or any other condition to any Borrowing or other Credit Extension
hereunder or any condition precedent to the effectiveness of this Agreement.

“Approved Securities
Intermediary” means a “securities intermediary” or “commodity intermediary”
(as such terms are defined in the UCC) selected or approved by the Administrative
Agent.

“Asset Sale” means a sale, lease or sublease (as
lessor or sublessor), Sale and Leaseback Transaction, assignment, conveyance,
transfer or other disposition to, or any exchange of property with, any Person
(other than any Borrower or any Guarantor), in one transaction or a series of
transactions, of all or any part of the Borrower’s or any of its Subsidiaries’
businesses, assets or properties of any kind, whether real, personal, or mixed
and whether tangible or intangible, whether now owned or hereafter acquired,
including, without limitation, the Capital Stock of any of the Borrower’s
Subsidiaries, in each case other than (i) inventory (or other assets) sold
or leased in the ordinary course of business (excluding any such sales by operations
or divisions discontinued or to be discontinued), (ii) leases of real
property in the ordinary course of business, (iii) substantially worn,
damaged or obsolete property disposed of in the ordinary course of business,
(iv) returns of inventory, (v) the use of cash and Cash Equivalents
in a manner not inconsistent with the provisions of the Agreement or the other
Credit Documents and (vi) licenses or sublicenses of patents, trademarks,
copyrights and other intellectual property in the ordinary course of business.

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

“Assignment Effective Date”  as defined in Section 10.6(b).

“Attributable Indebtedness,”
when used with respect to any Sale and Leaseback Transaction, means, as at the
time of determination, the present value (discounted at a rate borne by the
Revolving Loans at such time, compounded on a semi-annual basis) of the total
obligations of the lessee for rental payments during the remaining term of the
lease included in any such Sale and Leaseback Transaction.

“Authorized Officer” means, as applied to any Person,
the principal executive officers, managing members or general partners of such
Person, including any individual holding the position of chairman of the board
(if an officer), chief executive officer, president or one of its executive
vice presidents (or the equivalent thereof), but, in any event, with respect to
financial matters, such Person’s chief financial officer, treasurer, controller
or senior vice president of corporate finance.

“Automotive.com”
means Automotive.com, Inc., a Delaware corporation.

“Automotive.com Earn-Out
Obligation” means the earn-out obligation pursuant to the Automotive.com
Stockholders Agreement and the Automotive.com Stock Purchase Agreement.

 4
 

“Automotive.com Put/Call
Option” means the option to purchase, and the right to cause the
sale of, certain shares of issued and outstanding common stock of
Automotive.com not held by Enthusiast Media, as set forth in the Automotive.com
Stockholders Agreement.

“Automotive.com Stock
Purchase Agreement” means that certain Stock Purchase Agreement
dated as of November 15, 2005 by and among PRIMEDIA Inc., a Delaware
corporation, Automotive.com and each shareholder listed therein.

“Automotive.com
Stockholders Agreement” means that certain Automotive.com
Stockholders Agreement dated as of November 15, 2005 by and among PRIMEDIA
Inc., a Delaware corporation, Automotive.com and each holder of common stock
listed therein.

 “Availability Reserve”  means, as of
three (3) Business Days after the date of written notice of any determination
thereof to the Borrower by the Administrative Agent, such amounts as the
Administrative Agent may from time to time establish against the Revolving
Credit Facility, as deemed reasonably necessary by the Administrative Agent in
its Permitted Discretion, in order either (a) to preserve the value of the
Current Asset Collateral or the Collateral Agent’s Lien thereon or (b) to
provide for the payment of unanticipated liabilities of the Borrower or any
Guarantor arising after the Closing Date; provided, however, that
the amount of any Availability Reserve (i) shall be reasonably related to
the issue giving rise to the implementation of such Availability Reserve and
(ii) shall not be duplicative of other reserves then in effect.

“Bailee’s Letter”
means a letter substantially in the form of Exhibit L, with such
amendments or modifications as may be approved by the Administrative Agent and
executed by any Person (other than the Borrower and the Guarantors) that is in
possession of otherwise Eligible Inventory on behalf of any Borrower or any
Guarantor pursuant to which such Person acknowledges, among other things, the
Collateral Agent’s Lien with respect thereto.

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

“Base Rate” means, for any day, a rate per annum equal
to the greater of (i) the rate of interest announced publicly by Citibank in
New York, New York, from time to time, as Citibank’s base rate and (ii) 1⁄2 of 1%
plus the Federal Funds Effective Rate in effect on such day.  Any change in the Base Rate due to a change
in the Federal Funds Effective Rate shall be effective on the effective day of
such change in Citibank’s base rate or the Federal Funds Effective Rate,
respectively.

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

“Blockage Notice”
means a notice of “control” (as defined in the UCC) contemplated to be delivered
pursuant to each Deposit Account Control Agreement.

“Board of Governors”
means the Board of Governors of the United States Federal Reserve System, or
any successor thereto.

“Books” means
all of the Borrower’s and its Subsidiaries’ now-owned or hereafter acquired
books and records (including all of their records indicating, summarizing, or
evidencing their assets (including the Collateral) or liabilities, all of the
Borrower’s and its Subsidiaries’ records relating to their business operations
or financial condition, and all of their goods or General Intangibles related
to such information).

“Borrower” as
defined in the preamble hereto.

 5
 

“Borrower’s Accountants”
means BDO Seidman, LLP or other independent nationally-recognized public
accountants reasonably acceptable to the Administrative Agent.

“Borrowing”  means (a) a borrowing consisting of Revolving Loans
made on the same day by the Lenders ratably according to their respective
Revolving Commitments, (b) a borrowing consisting of Swing Line Loans
pursuant to Section 2.2 or (c) the incurrence of any Protective Advance,
as the context may require.

“Borrowing Base”
means, as of any date of determination, the result of:

(i)       the
sum of:

(A)          85% of the amount of
Eligible Receivables (other than Foreign Accounts), less
the amount, if any, of the Dilution Reserve applicable thereto, and

(B)           85% of the amount of
Eligible Foreign Accounts, less the
amount, if any, of the Dilution Reserve applicable thereto, and

(C)           the lesser of:

(x)            85% of the Net
Orderly Liquidation Value of the Eligible Inventory and

(y)           65% times the
aggregate book value, measured at cost, of the Eligible Inventory,

provided
that the aggregate amount of the Borrowing Base that may be supported by (i)
In-Store Services Accounts at any time shall not exceed the In-Store Services
Subline Amount and (ii) Eligible Foreign Accounts at any time shall not exceed
the Eligible Foreign Accounts Subline Amount,

minus

(ii)       the sum of (i) the Rent
Reserve and (ii) the Eligibility Reserve.

“Borrowing Base Certificate”
means a certificate of the Borrower substantially in the form of
Exhibit M.

“Bridge Loan Agreement”
means the Senior Subordinated Bridge Loan Agreement dated as of the Closing
Date among the Borrower, Citicorp North America, Inc., as administrative agent
and the other agents and lenders party thereto.

“Bridge Loan Documents” means
the collective reference to the Bridge Loan Agreement and the other Loan
Documents as defined in the Bridge Loan Agreement, including each guarantee and
the notes issued thereunder.

“Bridge Loans”
means (i) the senior subordinated unsecured term loans of the Borrower in an
aggregate principal amount of $465,000,000 made on the Closing Date under the
Bridge Loan Agreement and (ii) any “Term Loans” or “Exchange Notes” referred to
therein for which or into which such loans may be converted, replaced or
exchanged at the option of the Borrower or the holders thereof pursuant to the
terms of the Bridge Loan Agreement.

 6
 

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

“Business Segment”
means any of the DVD/CD Business Segment, the In-Store Business Segment, the
Magazine Distribution Business Segment or the Magazine Publication Business
Segment.

“Calculation Date”
as defined in the definition of “Fixed Charge Coverage Ratio.”

“Capital Expenditures” means, for any period for any
Person, the aggregate of all expenditures of such Person during such period
determined on a consolidated basis that, in accordance with GAAP, are or should
be included in “purchase of property and equipment” or similar items reflected
in the statement of cash flows of such Person, including capitalized display
rack costs.

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

“Capital Stock” means any and all shares, equity interests
or other equivalents (however designated) of capital stock of a corporation,
any and all equivalent ownership interests in a Person (other than a corporation),
including, without limitation, partnership interests and membership interests,
and any and all warrants, rights or options to purchase or other arrangements
or rights to acquire any of the foregoing.

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

“Cash Collateral Account”
means any Deposit Account or Securities Account that is (a) established by the
Collateral Agent from time to time in its sole discretion to receive Cash and
Cash Equivalents (or purchase cash or Cash Equivalents with funds received)
from the Credit Parties or Persons acting on their behalf pursuant to the
Credit Documents, (b) with such depositaries and securities intermediaries as
the Collateral Agent may determine in its sole discretion, (c) in the name of
the Collateral Agent (although such account may also have words referring to
the Borrower and the account’s purpose), (d) under the control of the
Collateral Agent and (e) in the case of a Securities Account, with respect to
which the Collateral Agent shall be the Entitlement Holder and the only Person
authorized to give Entitlement Orders with respect thereto.

“Cash Equivalents” means, as at any date of
determination, (i) marketable securities (a) issued or directly and
unconditionally guaranteed as to interest and principal by the United States Government
or (b) issued by any agency of the United States the obligations of which are
backed by the full faith and credit of the United States, in each case maturing
within one year after such date; (ii) marketable direct obligations issued by
any state of the United States of America or any political subdivision of any
such state or any public instrumentality thereof, in each case maturing within
one year after such date and having, at the time of the acquisition thereof, a
rating of at least A-1 from S&P or at least P-1 from Moody’s;
(iii) commercial paper maturing no more than one year from the date of creation
thereof and having, at the time of the acquisition thereof, a rating of at
least A-1 from S&P or at least P-1 from Moody’s; (iv)
certificates of deposit or bankers’ acceptances maturing within one year after
such date and issued or accepted by any Lender or by any commercial bank
organized under the laws of the United States of America or any state thereof
or the District of Columbia that (a) is at least “adequately capitalized” (as
defined 

 7
 

in the regulations of its primary Federal banking
regulator) and (b) has Tier 1 capital (as defined in such regulations) of not
less than $100,000,000; and (v) shares of any money market mutual fund that (a)
has substantially all of its assets invested continuously in the types of
investments referred to in clauses (i) and (ii) above, (b) has net assets of
not less than $500,000,000, and (c) has the highest rating obtainable from
either S&P or Moody’s.

“Cash Management Document” means any certificate, agreement or
other document executed by any Credit Party in respect of the Cash Management
Obligations of any Credit Party.

“Cash Management Bank” means any Person that is a Lender
or an Approved Counterparty at the time it provides any Cash Management
Services.

“Cash Management
Obligations” means obligations owed by any Credit Party to any Cash
Management Bank in respect of or in connection with any Cash Management Services.

“Cash Management
Services” means any agreement or arrangement to provide cash management
services, including treasury, depository, overdraft, credit or debit card,
purchase card, electronic funds transfer and other cash management arrangements.

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

“CGMI”
means Citigroup Global Markets Inc.

“Change of Control”
means:

(i)            any Person or “group” (within the
meaning of Rules 13d-3 and 13d-5 under the Exchange Act) other than
Yucaipa and/or its Controlled Investment Affiliates (a) shall have acquired
beneficial ownership of 30% or more on a fully diluted basis of the voting
and/or economic interest in the Capital Stock of the Borrower or (b) shall have
obtained the power (whether or not exercised) to elect a majority of the
members of the board of directors (or similar governing body) of the Borrower;
or

(ii)           at any time, the majority of the
seats (other than vacant seats) on the board of directors (or similar governing
body) of the Borrower cease to be occupied by Persons who either (a) were
members of the board of directors of the Borrower on the Closing Date or
(b) were nominated for election by the board of directors of the Borrower,
a majority of whom were directors on the Closing Date or whose appointment or
nomination for election was previously approved by a majority of such directors
(including by approval of the proxy statement in which such individual is named
as a nominee for director).

“Citibank” means
Citibank, N.A., a national banking association.

“Closed Accounts”
means those Deposit Accounts of a Borrower or Subsidiary of a Borrower that
such Borrower or Subsidiary will use commercially reasonable efforts to close
within 90 days of the Closing Date, as set forth on Schedule 1.1(a).

“Closing Date”  means August 1, 2007, the date on which all the
conditions precedent in Section 3.1 are satisfied or waived in accordance
with Section 3.1.

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

 8
 

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

“CNAI” as
defined in the preamble hereto.

“Collateral” means, collectively, all of the real,
personal and mixed property (including Capital Stock) and interests therein and
proceeds thereof, whether now owned or hereafter acquired, in or upon which
Liens are purported to be granted pursuant to any of the Collateral Documents
as security for the Obligations.

“Collateral Access Agreement” means a Landlord Access
Agreement, Bailee Letter, mortgagee waiver or acknowledgement agreement of a
lessor, mortgagee, warehouseman, processor, consignee, or other Person in possession
of, having a Lien upon, or having rights or interests in any Credit Party’s
Books, Equipment or Inventory, in each case, in form and substance satisfactory
to the Administrative Agent.

“Collateral Agent”  means
CNAI in its capacity as collateral agent for the Secured Parties.

“Collateral Documents” means the Pledge and Security
Agreement, the Perfection Certificate, the Mortgages, the Deposit Account
Control Agreements, the Securities Account Control Agreements, the Intellectual
Property Security Agreements, each Guaranty, the Vendor Intercreditor
Agreements, the Collateral Access Agreements, the Consignment Agreements, if
any, and all other instruments, documents and agreements delivered by any
Credit Party pursuant to this Agreement or any of the other Credit Documents in
order to grant to Collateral Agent, for the benefit of Secured Parties, a Lien
on any real, personal or mixed property of such Credit Party as security for
the Obligations.

“Collections”
means all cash, checks, notes, instruments, and other items of payment
(including insurance proceeds, proceeds of cash sales, rental proceeds, and tax
refunds).

“Commitment”
means, as to each Lender, its Revolving Commitment and its commitment to acquire
participations in Protective Advances.

“Commodity Account”
has the meaning given to such term in the UCC.

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

“Concentration Account”
has the meaning given to such term in Section 5.16(c).

“Consignment Agreement”
means a Consignment Agreement, in form and substance satisfactory to the
Administrative Agent in its Permitted Discretion, made by a consignee of a
Credit Party’s Inventory in favor of Collateral Agent.

“Consolidated Adjusted EBITDA” means, for any period, an
amount determined for the Borrower and its Subsidiaries on a consolidated basis
equal to:

(i)            the sum, without duplication (and
except with respect to clause (i)(a), to the extent not already added in the
calculations of Consolidated Net Income) of the amounts for such period of:

(a)           Consolidated Net Income;

 9
 

(b)           Consolidated Interest Expense;

(c)           provisions for taxes based on income;

(d)           total depreciation expense;

(e)           total amortization expense (including
amortization associated with capitalized display rack costs and the recognition
of such costs as a deferred cost asset amortized as contra revenue);

(f)            extraordinary or unusual
non-recurring charges, expenses or losses, including, without limitation,
losses and charges from discontinued titles;

(g)           stock option based compensation
expenses and non-cash compensation expenses relating to Automotive.com;

(h)           cash fees and expenses incurred in
connection with the Transactions, Permitted Acquisitions and the incurrence of
Indebtedness of the type described in clause (i) of the definition thereof;

(i)            management fees and expenses
permitted to be paid in accordance with Section 6.11;

(j)            non-recurring restructuring,
severance, relocation, facility closure and integration costs in connection
with (i) the Transactions and certain acquisitions consummated prior to the
Closing Date and listed on Schedule 1.1(b) hereto and (ii) any
Permitted Acquisition; provided that with respect to clause (ii), (A)
such costs shall be in an amount not to exceed ten percent (10%) of
Consolidated Adjusted EBITDA for such period (as determined prior to giving
effect to any amount added to Net Income in calculating Consolidated Adjusted
EBITDA for such period pursuant to this clause (j)), and (B) the Borrower shall
have delivered to the Administrative Agent an officer’s certificate specifying
and quantifying such cost and stating that such cost is a non-recurring restructuring,
severance, reduction, facility closure or integration cost in connection with
the Transactions, such Permitted Acquisition or such acquisition specified on Schedule
1.1(b) hereto, as the case may be;

(k)           other non-Cash charges, expense
or losses reducing Consolidated Net Income including, but not limited to,
non-Cash impairment charges, non-Cash charges relating to the conversion of any
customer to Scan-Based Trading and charges or adjustments arising from subscriptions
sold by Enthusiast Media prior to the Closing Date (excluding any such non-Cash
charge, expense or loss to the extent that it represents an accrual or reserve
for potential Cash expenses in any future period or amortization of a prepaid
Cash expense that was paid in a prior period); and

(l)            non-interest losses from any Hedge
Agreements,

minus

(ii)           the sum, without duplication (and to
the extent not already deducted in the calculation of Consolidated Net Income),
of the amounts for such period of:

(a)           interest income;

 10
 

(b)           any credit for income tax;

(c)           gains or income from extraordinary,
unusual or non-recurring items for such period including gains recognized in
connection with the sale of any assets outside the ordinary course of business;

(d)           other non-Cash items increasing
Consolidated Net Income for such period (excluding any such non-Cash item
to the extent it represents the reversal of an accrual or reserve for potential
Cash item in any prior period) (other than the accrual of revenue in the
ordinary course); and

(e)           non-interest gains from any Hedge
Agreements.

Notwithstanding the
foregoing, it is agreed that Consolidated Adjusted EBITDA for the Fiscal
Quarters ended October 31, 2006, January 31, 2007 and April 30, 2007 shall be
$52.3 million, $54.1 million and $45.5 million, respectively.

“Consolidated Fixed Charges” means, for any period, the
sum, without duplication, of the amounts determined for the Borrower and its
Subsidiaries on a consolidated basis equal to (i) Consolidated Interest Expense,
(ii) all cash dividend payments or other distributions (excluding items
eliminated in consolidation) on any series of Preferred Stock during such
period; and (iii)      all cash dividend
payments or other distributions (excluding items eliminated in consolidation)
on any series of Disqualified Capital Stock made during such period.

“Consolidated Interest Expense” means, for any period,
total interest expense (including that portion attributable to Capital Leases
in accordance with GAAP, capitalized interest, interest in respect of original
issue discount and interest imputed on Attributable Indebtedness) of the
Borrower and its Subsidiaries on a consolidated basis with respect to all
outstanding Indebtedness of the Borrower and its Subsidiaries, including all
commissions, discounts and other fees and charges owed with respect to letters
of credit and net costs under Interest Rate Agreements, but excluding, however,
any amounts referred to in Section 2.9 payable on or before the Closing Date.

“Consolidated Net Income” means, for any period,
(i) the net income (or loss) of the Borrower and its Subsidiaries on a
consolidated basis for such period taken as a single accounting period determined
in conformity with GAAP, minus
(ii) to the extent included in clause (i), (a) the income (or loss) of any
Person (other than a Subsidiary of the Borrower) in which any other Person
(other than the Borrower or any of its Subsidiaries) has a joint interest,
except to the extent of the amount of dividends or other distributions actually
paid to the Borrower or any of its Subsidiaries by such Person during such period,
(b) the income (or loss) of any Person accrued prior to the date it
becomes a Subsidiary of the Borrower or is merged into or consolidated with the
Borrower or any of its Subsidiaries or that Person’s assets are acquired by the
Borrower or any of its Subsidiaries, (c) the income of any Subsidiary of
the Borrower to the extent that the declaration or payment of dividends or
similar distributions by that Subsidiary of that income is not at the time
permitted by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to that Subsidiary, (d) any after-tax gains or losses
attributable to Asset Sales outside the ordinary course or returned surplus
assets of any Pension Plan, (e) any after-tax income or loss from discontinued
operations and (f) (to the extent not included in clauses (a) through
(e) above) any net extraordinary gains or net extraordinary losses.

“Consolidated Total Debt” means with respect to the
Borrower and its Subsidiaries, as at any date of determination, Indebtedness of
the type specified in clauses (i), (ii) and (iii) of the definition of “Indebtedness”
and non-contingent obligations of the type specified in clause (vi) of such
definition and 

 11
 

clause (x)(a) of such definition (to the extent such
obligations under clause (x)(a) relate to Indebtedness of the type described in
clauses (i), (ii) and (iii) of such definition), determined on a consolidated
basis in accordance with GAAP.

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

“Control” shall
mean the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a person, whether through the
ownership of voting securities, by contract or otherwise, and the terms “Controlling” and “Controlled”
shall have meanings correlative thereto.

“Control Account”
means a Securities Account or Commodity Account that is the subject of an
effective Securities Account Control Agreement and that is maintained by any
Credit Party with an Approved Securities Intermediary.  “Control Account” includes all Financial
Assets held in a Securities Account or a Commodity Account and all certificates
and instruments, if any, representing or evidencing the Financial Assets
contained therein.

“Control Agreement”
has the meaning given such term in the Pledge and Security Agreement.

“Controlled Investment Affiliate”
means, as to any person, any other person which directly or indirectly is in
Control of, is Controlled by, or is under common Control with, such person and
is organized by such person (or any person Controlling such person) primarily
for making equity or debt investments in the Borrower or other portfolio
companies of such person.

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

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

“Counterpart Agreement” means a Counterpart Agreement
substantially in the form of Exhibit H delivered by a Credit Party
pursuant to Section 5.11.

“Covered Inventory” has the meaning set forth in the definition
of “Eligible Inventory.”

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

“Credit Document” means any of this Agreement, the
Notes, if any, the Intercreditor Agreement, the Collateral Documents, the
Letters of Credit, each Borrowing Base Certificate, Letter of Credit
Reimbursement Agreements and any other documents or certificates executed by
the Borrower in favor of the Issuing Bank relating to Letters of Credit, the
Cash Management Agreements and the Fee Letter.

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

“Credit Party” means, collectively, the Borrower and the
Guarantors.

“Currency Agreement” means any foreign exchange
contract, currency swap agreement, futures contract, option contract, synthetic
cap or other similar agreement or arrangement, each of which is for 

 12
 

the purpose of hedging the foreign currency risk
associated with the Borrower’s and its Subsidiaries’ operations and not for
speculative purposes.

“Current Asset Collateral”
as defined in the Intercreditor Agreement.

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

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

“Default Period” means, with respect to any Defaulting
Lender, the period commencing on the date of the applicable Funding Default and
ending on the earliest of the following dates: 
(i) the date on which all Revolving Commitments are cancelled or
terminated and/or the Obligations are declared or become immediately due and
payable, (ii) the date on which (a) the Default Excess with respect to such Defaulting
Lender shall have been reduced to zero (whether by the funding by such
Defaulting Lender of any Defaulted Loans of such Defaulting Lender or by the
non-pro rata application of any voluntary or mandatory prepayments of the
Loans in accordance with the terms of Section 2.11 or Section 2.13 or by a
combination thereof) and (b) such Defaulting Lender shall have delivered to the
Borrower on behalf and the Administrative Agent a written reaffirmation of its
intention to honor its obligations hereunder with respect to its Revolving
Commitments, and (iii) the date on which the Borrower, the Administrative Agent
and the Requisite Lenders waive all Funding Defaults of such Defaulting Lender
in writing.

“Defaulted Loan” as defined in Section 2.21.

“Defaulting Lender” as defined in Section 2.21.

“Deposit Account” as defined in the UCC.

“Deposit Account Bank”
means Wachovia Bank, National Association or a financial institution selected
or approved by the Administrative Agent.

“Deposit Account Control
Agreement” as defined in the Pledge and Security Agreement.

“Dilution”
means, for each Business Segment, as of any date of determination, a
percentage, based upon the experience of the twelve-month period ending as of
the last day of the immediately preceding fiscal month, which is the result of
dividing the Dollar amount of (a) credits, including credits issued for bad
debt write-downs, discounts, advertising allowances, profit sharing deductions
or other dilutive items with respect to Credit Parties’ Accounts for such
Business Segment during such period, by (b) such Credit Parties’ billings with
respect to Accounts for such Business Segment during such period.

“Dilution Reserve”
means, for each Business Segment, as of any date of determination, an amount
sufficient to reduce the advance rate against Eligible Receivables of such
Business Segment by 1 percentage point for each percentage point by which Dilution
for such Business Segment is in excess of 5%.

“Disqualified Capital Stock”
means any Capital Stock which, by its terms (or by the terms of any security
into which it is convertible or for which it is exchangeable), or upon the
happening of any 

 13
 

event, (a) matures (excluding any maturity as the
result of an optional redemption by the issuer thereof) or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is
redeemable at the option of the holder thereof, in whole or in part, on or
prior to the first anniversary of the Revolving Commitment Termination Date,
(b) is convertible into or exchangeable (unless at the sole option of the
issuer thereof) for (i) debt securities or (ii) any Capital Stock
referred to in (a) above, in each case at any time on or prior to the first
anniversary of the Revolving Commitment Termination Date, or (c) contains
any repurchase obligation which may come into effect prior to payment in full
of all Obligations; provided,  however,
that any Capital Stock that would not constitute Disqualified Capital Stock but
for provisions thereof giving holders thereof (or the holders of any security
into or for which such Capital Stock is convertible, exchangeable or
exercisable) the right to require the issuer thereof to redeem such Capital
Stock upon the occurrence of a change in control or an asset sale occurring
prior to the 90th day after the Revolving Commitment Termination Date shall not
constitute Disqualified Capital Stock if such Capital Stock provides that the
issuer thereof will not redeem any such Capital Stock pursuant to such
provisions prior to the repayment in full of the Obligations.

“Documentary Letter of
Credit” means any Letter of Credit that is drawable upon presentation
of documents evidencing the sale or shipment of goods purchased by the Borrower
or any Subsidiaries in the ordinary course of its business.

“Dollar Equivalent”  of any amount means, at the time of determination thereof,
(a) if such amount is expressed in Dollars, such amount and (b) if such amount
is denominated in any other currency, the equivalent of such amount in Dollars
as determined by the Administrative Agent using any customary method of
determination it deems appropriate.

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

“Domestic Subsidiary” means any Subsidiary organized
under the laws of the United States of America, any State thereof or the
District of Columbia.

“DVD/CD Business Segment”
means the business and operations of the Borrower and its Domestic Subsidiaries
related to the manufacture, distribution and fulfillment of prerecorded media
including cassette tapes, albums, CDs and DVDs, the creation or licensing of
content for any of the foregoing, and, in each case, services related to any of
the foregoing conducted by the Borrower and its Domestic Subsidiaries.

“Eligibility Reserves”
means, effective as of two Business Days after the date of written notice of
any determination thereof to the Borrower by the Administrative Agent, such
amounts as the Administrative Agent, in its Permitted Discretion, may from time
to time establish against the gross amounts of eligible trade accounts
receivable and Eligible Inventory to reflect risks or contingencies arising
after the Closing Date that may affect the collectability of such accounts or
the saleability of such inventory and that have not already been taken into
account in the calculation of the Borrowing Base.

“Eligible Assignee” means (i) any Agent, any Lender, any
Affiliate of any Agent or Lender, any Related Fund (any two or more Related
Funds being treated as a single Eligible Assignee for all purposes hereof) and
any Federal Reserve Bank, and (ii) any commercial bank, insurance company,
investment or mutual fund or other entity which extends credit or buys loans as
one of its businesses; provided, no Affiliate of the Borrower or Yucaipa
shall be an Eligible Assignee.

“Eligible Foreign Accounts”
as defined in “Eligible Receivables.”

“Eligible  Foreign Accounts
Subline Amount” means an amount equal to $30,000,000.

 14
 

“Eligible Inventory”
means Inventory of the Credit Parties consisting of CDs, DVDs, VHS cassettes,
video games, paper stock and other related merchandise reasonably satisfactory
to Administrative Agent in its Permitted Discretion (and in any event excluding
magazines and wire rack products) (such non-excluded merchandise being referred
to herein as the “Covered Inventory”),
held or available for sale in the ordinary course of business of such Credit
Party (provided that paper stock shall not be required to be held
available for sale), that complies with each of the representations and warranties
respecting Eligible Inventory made by such Credit Party in the Credit
Documents, that is owned solely by any Borrower free and clear from any Lien in
favor of a third party (other than the Collateral Agent’s Liens and the Second
Priority Lien in favor of the Term Loan Collateral Agent pursuant to the Term
Loan Credit Documents), that is subject to a valid, perfected and enforceable
First Priority Lien, and that is not excluded as ineligible by virtue of the
one or more of the criteria set forth below; provided, however,
that such criteria may be fixed and revised from time to time by Administrative
Agent in Administrative Agent’s Permitted Discretion to address the results of
any audit or appraisal performed by the Administrative Agent from time to time
after the Closing Date. An item of Inventory shall not be included in Eligible
Inventory if:

(a)           no
Credit Party has good, valid, and marketable title thereto,

(b)           it
is not located at one of the locations in the continental United States set
forth on Schedule 2(c) to the Perfection Certificate or in-transit from
one such location to another such location, or if held on consignment at a
customer location, such customer has not executed a Consignment Agreement or
such Inventory is not segregated or otherwise separately identifiable from
goods of others, if any, stored on the premises,

(c)           it
is located on real property leased by a Credit Party or in a contract
warehouse, in each case, unless it is segregated or otherwise separately
identifiable from goods of others, if any, stored on the premises, and either
(i) it is subject to a Collateral Access Agreement executed by the lessor, or
warehouseman, as the case may be, or (ii) the Administrative Agent has established
a Rent Reserve against the Borrowing Base for such Leasehold Property location
or contract warehouse,

(d)           [Reserved],

(e)           it
is not subject to a valid and perfected First Priority Lien in favor of the
Collateral Agent, except to the extent the Collateral Agent’s Lien is subject
to a valid and perfected First Priority Lien in favor of a Vendor which Vendor
Lien is subject to a duly executed Vendor Intercreditor Agreement from such
Vendor, provided that such Inventory subject to a Vendor Lien on the Closing
Date shall not be excluded from Eligible Inventory solely by reason of this
clause (e) for a period of 60 days after the Closing Date,

(f)            it
consists of goods that are obsolete or Slow Moving Inventory, restrictive or
custom items, work-in-process, raw materials (other than paper stock), goods
returned or rejected by such Credit Parties’ customers and no longer held or
available for sale by such Credit Parties, or goods that constitute spare
parts, packaging and shipping materials, supplies used or consumed in such
Credit Parties’ business, bill and hold goods, defective goods, “seconds,” “breached”
or Inventory acquired on consignment,

(g)           Administrative
Agent has not received a current appraisal of such Inventory from an Acceptable
Appraiser pursuant to Section 5.9, or

 15
 

(h)           it
consists of magazine paper purchased from paper manufacturers which is then
used by printers for magazine printing, unless (i) it is subject to a
Collateral Access Agreement executed by the lessor, or warehouseman, as the
case may be, and (ii) the Administrative Agent has received confirmation of no
offsets and that it is not otherwise subject to a Lien.

The Borrower may amend or supplement Schedule 2(c)
to the Perfection Certificate, provided that (i) such amendment or
supplement occurs by written notice to the Administrative Agent not less than
30 days prior to the date on which the Eligible Inventory is moved to such new
location, (ii) such new location is within the continental United States, and
(iii) at the time of such written notification, the Borrower provides any financing
statements necessary to perfect and continue perfected the Collateral Agent’s
Liens on such assets and, to the extent it is located on real property leased
by a Credit Party, provides to the Administrative Agent a Collateral Access
Agreement.

“Eligible Receivable”
means the gross outstanding balance of each Account (“Receivables”)
of any Credit Party arising out of the sale of merchandise, goods or services
in the ordinary course of business, that is made by any Credit Party to a
Person that is not an Affiliate of any Credit Party and that constitutes
Collateral in which the Collateral Agent has a fully perfected First Priority
Lien; provided, however, that an Account shall not be an
“Eligible Receivable” if any of the following shall be true:

(a)           (i)
Accounts that the Account Debtor has failed to pay within 90 days (or 120 days
if created from the purchase of music, games or movies between the dates of
October 1 and December 1) of original invoice date, provided that up to
$5,000,000 of In-Store Services Accounts outstanding at any time shall not be
excluded from Eligible Receivables solely by reason of this subclause (i) if
such In-Store Services Accounts are not past the invoice date by more than 180
days, or (ii) Accounts with selling terms of more than 60 days, provided that
In-Store Services Accounts arising under the retail display payment claiming
business of US Marketing Services shall not be excluded from Eligible
Receivables solely by reason of this subclause (ii) if such Accounts have
selling terms providing for payment not more than 90 days after the end of such
calendar quarter; or

(b)           Accounts
owed by an Account Debtor (or its Affiliates) where 50% or more of all Accounts
owed by that Account Debtor (or its Affiliates) are deemed ineligible under
clause (a) above; or

(c)           Accounts
with respect to which the Account Debtor is an Affiliate of any Credit Party or
an employee or agent of any Credit Party or any Affiliate of any Credit Party;
or

(d)           Accounts
(other than any Fulfillment Accounts) arising in a transaction wherein goods
are placed on consignment or are sold pursuant to a guaranteed sale, a sale or
return, a sale on approval, a bill and hold, or any other terms by reason of
which the payment by the Account Debtor may be conditional, unless such
Accounts arise under a written agreement which includes security interest or
bill and hold provisions, as applicable; or

(e)           Accounts
that are not payable in U.S. Dollars; provided that Accounts in an
amount up to the Dollar Equivalent of $5.0 million that are payable in Canadian
dollars, Australian dollars, pounds Sterling, euros or Mexican pesos shall not
be excluded under this clause (e); or

(f)            Accounts
with respect to which the Account Debtor either (i) does not maintain its chief
executive office in the United States, (ii) is not organized under the laws of
the United States or any state thereof, or (iii) is the government of any
foreign country or sovereign state, or 

 16

 

of any state, province,
municipality, or other political subdivision thereof, or of any department,
agency, public corporation, or other instrumentality thereof (collectively, “Foreign Accounts”), unless such Account Debtor is deemed
eligible in the Administrative Agent’s sole discretion and such Account is
invoiced in the United States (“Eligible Foreign Accounts”);
or

(g)           Accounts
with respect to which the Account Debtor is either (i) the United States, or
any department, agency, or instrumentality of the United States (exclusive,
however, of Accounts with respect to which the applicable Borrower has
complied, to the reasonable satisfaction of Administrative Agent, with the
Assignment of Claims Act, 31 U.S.C. Section 3727), or (ii) any state of the
United States; provided that,
notwithstanding the foregoing, up to $5.0 million of Accounts otherwise
excluded, subject to this clause (g) shall not be excluded under this clause
(g); or

(h)           Accounts
with respect to which the Account Debtor (A) is a creditor of any Credit Party,
(B) has or has asserted a right of set-off, or (C) has disputed its obligation
to pay all or any portion of the Account, in each case, to the extent of the
amount of such claim, credit, right of setoff, or dispute, unless in the case
of clause (A) or (B) the Account Debtor has waived any right of set-off in writing;
or

(i)            Accounts
with respect to an Account Debtor whose total obligations owing to the Credit
Parties if such Account Debtor is (i) a customer with an Investment Grade
Rating, 20%, (ii) a Segment A Designated Account, 25% (provided
that such percentage will be 30% for the period from September 30 to
December 31), (iii) a Segment B Designated Account, 20% (provided
that such percentage will be 25% for the period from September 30 to
December 31), (iv) a Segment C Designated Account, 15% (provided that
such percentage will be 20% for the period from September 30 to December 31),
(v) a Segment D Designated Account, 15%, and (vi) not covered by clauses
(i)-(v) above, 10% (in each case, such applicable percentage, as applied to a
particular Account Debtor, being subject to reduction by Administrative Agent
in its Permitted Discretion if the creditworthiness of such Account Debtor
deteriorates), in each case, of all Eligible Receivables, to the extent of the
obligations owing by such Account Debtor to the Credit Parties in excess of
such percentages; provided, however, that, in each case, the
amount of Eligible Receivables that are excluded because they exceed the
foregoing percentages shall be determined by Administrative Agent based on all
of the otherwise Eligible Receivables prior to giving effect to any
eliminations based upon the foregoing concentration limits; or

(j)            Accounts
with respect to which the Account Debtor is subject to an insolvency
proceeding, is not solvent, has gone out of business, or as to which a Credit
Party has received notice of an imminent insolvency proceeding or a material
impairment of the financial condition of such Account Debtor; or

(k)           Accounts
with respect to which the Account Debtor is located in a state or jurisdiction
that requires, as a condition to access to the courts of such jurisdiction,
that a creditor qualify to transact business, file a business activities report
or other report or form, or take one or more other actions, unless the
applicable Borrower has so qualified, filed such reports or forms, or taken
such actions (and, in each case, paid any required fees or other charges),
except to the extent that the applicable Borrower may qualify subsequently as a
foreign entity authorized to transact business in such state or jurisdiction
and gain access to such courts, and such later qualification cures any access
to such courts to enforce payment of such Account; or

(l)            [Reserved];
or

 17
 

(m)          Accounts
that are not subject to a valid and perfected First Priority Lien in favor of
the Collateral Agent; or

(n)           Accounts
with respect to which (i) the goods giving rise to such Account have not been
shipped or billed to the Account Debtor, or (ii) the services giving rise to
such Account have not been performed or billed to the Account Debtor, provided
that this clause (n) shall not exclude Accounts where only delivery is required
to complete performance so long as such Accounts arise under a written
agreement which includes bill and hold provisions; or

(o)           Accounts
that represent the right to receive progress payments or other advance billings
that are due prior to the completion of performance by the applicable Borrower
of the subject contract for goods or services; or

(p)           Accounts
that are subject to any deduction, offset, counterclaim, return privilege,
volume sales discounts, co-op advertising credits or other condition given in
the course of the Credit Party’s business but only to the extent of such
deduction, offset, counterclaim, return privilege, discount, credit or other
condition; or

(q)           Accounts
that the Administrative Agent, in accordance with its customary criteria,
determines, in its commercially reasonable discretion, that there is a
substantial risk such Account is not likely to be paid or was invoiced under
COD terms; or

(q)           Accounts
that are not paid in full and the applicable Credit Party created a new
receivable for the unpaid portion of such Account, without the agreement of the
customer, and other Accounts constituting chargebacks, debit memos and other
adjustments for unauthorized deductions; or

(r)            Accounts
with respect to which the Account Debtor has disputed or made any claim with
respect to any other Account due from such Account Debtor to any Credit Party
but only to the extent of such dispute or claim.

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

“Enthusiast Media” means PRIMEDIA Enthusiast Media, Inc., a
Delaware corporation.

“Entitlement Holder” has the meaning given such term in
the UCC.

“Entitlement Order” has the meaning given such term in
the UCC.

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

“Environmental Laws” means any and all current or future
foreign or domestic, federal or state (or any subdivision of either of them),
statutes, ordinances, orders, rules, regulations, judgments, Governmental 

 18
 

Authorizations, or any other requirements of
Governmental Authorities relating to (i) environmental matters, including
those relating to any Hazardous Materials Activity; (ii) the generation,
use, storage, transportation or disposal of Hazardous Materials; or
(iii) occupational safety and health, industrial hygiene, land use or the
protection of human, plant or animal health or welfare and natural resources,
in any manner applicable to the Borrower or any of its Subsidiaries or any
Facility.

“Environmental Reports”
means, for each material Facility owned or operated by the Borrower or any
Subsidiary, reports and other information regarding environmental matters
relating to such Facility, including Phase I Reports, each in form, scope and
substance reasonably satisfactory to the Agents.

“Equipment”
means equipment (as that term is defined in the UCC), and includes machinery,
machine tools, motors, furniture and furnishings (but excluding fixtures),
vehicles (including motor vehicles), computer hardware, tools, parts, and goods
(other than consumer goods, farm products, or Inventory), wherever located,
including all attachments, accessories, accessions, replacements, substitutions,
additions, and improvements to any of the foregoing.

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

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

“ERISA Event” means (i) a “reportable event” within the
meaning of Section 4043 of ERISA and the regulations issued thereunder with
respect to any Pension Plan (excluding those for which the provision for 30-day
notice to the PBGC has been waived by regulation); (ii) the failure to meet the
minimum funding standard of Section 412 of the Internal Revenue Code or Section
302 of ERISA with respect to any Pension Plan (whether or not waived in
accordance with Section 412(d) of the Internal Revenue Code) or the failure to
make by its due date a required installment under Section 412(m) (or Section
430(j) of the Internal Revenue Code, as amended by the Pension Protection Act
of 2006) of the Internal Revenue Code with respect to any Pension Plan or the
failure to make any required contribution to a Multiemployer Plan;
(iii) the incurrence by the Borrower, any of its Subsidiaries, or any of
their respective ERISA Affiliates of any liability under Title IV of ERISA with
respect to the termination of any Pension Plan; (iv) the withdrawal by the
Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates
from any Pension Plan with two or more contributing sponsors or the termination
of any such Pension Plan resulting in liability to the Borrower, any of its
Subsidiaries or any of their respective Affiliates pursuant to Section 4063 or
4064 of ERISA; (v) the institution by the PBGC of proceedings to terminate any
Pension Plan, or the occurrence of any event or condition which might constitute
grounds under ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan; (vi) the imposition of liability on the Borrower,
any of its Subsidiaries or any of their respective ERISA Affiliates pursuant to
Section 4062(e) or 4069 of ERISA or by reason of the application of Section
4212(c) of ERISA; (vii) the incurrence by the Borrower, any of its Subsidiaries
or any of their respective ERISA Affiliates 

 19
 

of any liability with respect to a complete or partial
withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from any
Multiemployer Plan, or the receipt by the Borrower, any of its Subsidiaries or
any of their respective ERISA Affiliates of notice from any Multiemployer Plan
that it is in reorganization or insolvency pursuant to Section 4241 or 4245 of
ERISA, or that it intends to terminate or has terminated under Section 4041A or
4042 of ERISA; (viii) the occurrence of an act or omission which could give
rise to the imposition on the Borrower, any of its Subsidiaries or any of their
respective ERISA Affiliates of fines, penalties, taxes or related charges under
Chapter 43 of the Internal Revenue Code or under Section 409, Section 502(c),
(i) or (l), or Section 4071 of ERISA in respect of any Employee Benefit Plan;
(ix) the assertion of a material claim (other than routine claims for benefits)
against any Employee Benefit Plan other than a Multiemployer Plan or the assets
thereof, or against the Borrower, any of its Subsidiaries or any of their
respective ERISA Affiliates in connection with any Employee Benefit Plan; (x)
receipt from the Internal Revenue Service of notice of the failure of any
Pension Plan (or any other Employee Benefit Plan intended to be qualified under
Section 401(a) of the Internal Revenue Code) to qualify under Section 401(a) of
the Internal Revenue Code, or the failure of any trust forming part of any
Pension Plan to qualify for exemption from taxation under Section 501(a) of the
Internal Revenue Code; or (xi) the imposition of a Lien pursuant to Section
401(a)(29) or 412(n) of the Internal Revenue Code or pursuant to ERISA with
respect to any Pension Plan.

“Eurocurrency Liabilities”  has the meaning assigned to that term in Regulation D of
the Federal Reserve Board.

“Eurodollar Base Rate”  the rate determined by the Administrative Agent to be the
offered rate for deposits in Dollars for the applicable Interest Period
appearing on the Dow Jones Markets Telerate Page 3750 as of 11:00 a.m., London
time, on the second full Business Day next preceding the first day of each
Interest Period.  In the event that such
rate does not appear on the Dow Jones Markets Telerate Page 3750 (or otherwise
on the Dow Jones Markets screen), the Eurodollar Base Rate for the purposes of
this definition shall be determined by reference to such other comparable
publicly available service for displaying eurodollar rates as may be selected
by the Administrative Agent, or, in the absence of such availability, the
Eurodollar Base Rate shall be the rate of interest determined by the Administrative
Agent to be the rate per annum at which deposits in Dollars are offered by the
principal office of Citibank in London to major banks in the London interbank
market at 11:00 a.m. (London time) two Business Days before the first day of
such Interest Period in an amount substantially equal to the Eurodollar Rate
Loan for a period equal to such Interest Period.

“Eurodollar Rate”
means, with respect to any Interest Period for any Eurodollar Rate Loan, an
interest rate per annum equal to the rate per annum obtained by dividing (a)
the Eurodollar Base Rate by (b)(i) a percentage equal to 100% minus (ii) the
reserve percentage applicable two Business Days before the first day of such
Interest Period under regulations issued from time to time by the Federal Reserve
Board for determining the maximum reserve requirement (including any emergency,
supplemental or other marginal reserve requirement) for a member bank of the
Federal Reserve System in New York City with respect to liabilities or assets
consisting of or including Eurocurrency Liabilities (or with respect to any
other category of liabilities that includes deposits by reference to which the
Eurodollar Rate is determined) having a term equal to such Interest Period.

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

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

 20
 

“Excess Availability”
means, at any time, (a) the lesser of (i) the then effective
Revolving Commitments and (ii) the Borrowing Base at such time, minus (b) the sum of (i) the aggregate Revolving
Credit Outstandings at such time, and (ii) any Availability Reserve in
effect at such time.

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

“Existing Letters of Credit”
as defined in Section 2.3(k).

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

“Facility Agent”
means, collectively, the Administrative Agent, Collateral Agent, Syndication
Agent and Co-Documentation Agents.

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

“Federal Reserve Board”
means the Board of Governors of the United States Federal Reserve System, or
any successor thereto.

“Fee Letter”
means the Amended and Restated Fee Letter dated as of June 15, 2007 among
CGMI, JPMCB, JPMSI and the Borrower.

“Financial Asset”
has the meaning given to such term in the UCC.

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

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

“First Priority” means, with respect to any Lien
purported to be created in any Current Asset Collateral pursuant to any
Collateral Document, that such Lien is the only Lien to which such Collateral
is subject, other than any Permitted Lien which is junior in priority to the
Collateral Agent’s Lien on such Collateral.

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

 21
 

“Fiscal Year” means the fiscal year of the Borrower and
its Subsidiaries ending on January 31 of each calendar year or such other
date as the Borrower may otherwise determine and that is reasonably
satisfactory to the Administrative Agent.

“Fixed Asset Collateral”
means all assets of the Credit Parties other than Current Asset Collateral.

“Fixed Charge Coverage Ratio” means, for any period, the
ratio of (i) Consolidated Adjusted EBITDA for such period to (ii) the
Consolidated Fixed Charges for such period. 
In the event that the Borrower or any Subsidiary incurs, assumes,
guarantees, redeems, retires or extinguishes any Indebtedness (other than
Indebtedness incurred under any revolving credit facility that has been
permanently repaid and has not been replaced) or issues or redeems Disqualified
Capital Stock or Preferred Stock subsequent to the commencement of the period
for which the Fixed Charge Coverage Ratio is being calculated but prior to or
simultaneously with the event for which the calculation of the Fixed Charge
Coverage Ratio is made (the “Calculation Date”),
then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect to such incurrence, assumption, guarantee,
redemption, retirement or extinguishing of Indebtedness, or such issuance or
redemption of Disqualified Capital Stock or Preferred Stock, as if the same had
occurred at the beginning of the applicable four-quarter period (the “reference period”).

For purposes of making the computation referred to
above, Investments, acquisitions, dispositions, mergers, consolidations and
disposed operations (as determined in accordance with GAAP) that have been made
by the Borrower or any Subsidiary during the four-quarter reference period or
subsequent to such reference period and on or prior to or simultaneously with
the Calculation Date shall be calculated on a pro forma
basis assuming that all such Investments, acquisitions, dispositions, mergers,
consolidations and disposed operations (and the change in any associated fixed
charges and the change in Consolidated Adjusted EBITDA resulting therefrom) had
occurred on the first day of the reference period.  If since the beginning of such period any
Person (that subsequently became a Subsidiary or was merged with or into the
Borrower or any Subsidiary since the beginning of such period) shall have made
any Investment, acquisition, disposition, merger, consolidation or disposed
operation that would have required adjustment pursuant to this definition, then
the Fixed Charge Coverage Ratio shall be calculated giving pro forma
effect thereto for such period as if such Investment, acquisition, disposition,
merger, consolidation or disposed operation had occurred at the beginning of
the reference period.

For purposes of this definition, whenever pro forma effect is to be given to a transaction, the pro forma calculations shall be made in good faith by a
responsible financial or accounting officer of the Borrower and, for any fiscal
period ending on or prior to the first anniversary of an asset acquisition,
asset disposition, discontinued operation or operational change, may include
adjustments to reflect operating expense reductions and other operating
improvements or synergies reasonably expected to result from such asset
acquisition, asset disposition, discontinued operation or operational change,
for purposes of determining compliance with the Fixed Charge Coverage Ratio and
achievement of other financial measures provided for herein, such adjustments
may reflect additional operating expense reductions and other additional
operating improvements and synergies that would not be includable in pro forma financial statements prepared in accordance with
Regulation S-X but for which substantially all of the steps necessary for the
realization thereof have been taken or are reasonably anticipated by the Borrower
to be taken in the next 12-month period following the consummation thereof and,
are estimated on a good faith basis by the Borrower; provided, however,
(i) that the pro forma effect of all such
adjustments arising out of the Transactions and certain acquisitions
consummated prior to the Closing Date and listed on Schedule 1.1(b)
hereto on Consolidated Adjusted EBITDA for Fiscal Quarter ending prior to the
Closing Date have been fully reflected in the stipulated amounts for such
Fiscal Quarters set forth in the definition of “Consolidated Adjusted EBITDA”
and no such further adjustment in respect of such transactions shall be made
pursuant to this paragraph; and (ii)  that the aggregate amount of any
such adjustments other than in respect 

 22
 

of the Transactions and such transactions listed on Schedule
1.1(b) hereto shall not exceed five percent (5%) of Consolidated Adjusted EBITDA
of the Borrower in any reference period. 
The Borrower shall deliver to the Administrative Agent a certificate of
a Financial Officer of the Borrower setting forth such demonstrable or
additional operating expense reductions and other operating improvements or synergies
and information and calculations supporting them in reasonable detail.

If any Indebtedness bears a floating rate of interest
and is being given pro forma
effect, the interest on such Indebtedness shall be calculated as if the rate in
effect on the Calculation Date had been the applicable rate for the entire
period (taking into account any Obligation arising under any Hedge Agreement
applicable to such Indebtedness). 
Interest on Indebtedness with respect to Capital Leases shall be deemed
to accrue at an interest rate reasonably determined by a responsible financial
or accounting officer of the Borrower to be the rate of interest implicit in
such Indebtedness with respect to Capital Leases in accordance with GAAP.  For purposes of making the computation
referred to above, interest on any Indebtedness under a revolving credit
facility computed on a pro forma basis
shall be computed based upon the average daily balance of such Indebtedness
during the applicable period.  Interest
on Indebtedness that may optionally be determined at an interest rate based
upon a factor of a prime or similar rate, a eurocurrency interbank offered
rate, or other rate, shall be deemed to have been based upon the rate actually
chosen, or, if none, then based upon such optional rate chosen as the Borrower
may designate.

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

“Foreign Accounts” has the meaning set forth in clause (f) of
the definition of “Eligible Receivables.”

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

“Fraudulent Transfer Laws”
as defined in Section 7.2.

“Fulfillment Accounts” means Accounts arising from goods sold
and services rendered by the fulfillment business segments of the Credit
Parties including, without limitation, the distribution of magazines, confections
and general merchandise to the retail and wholesale markets, the distribution
of CDs, DVDs, VHS cassettes and general merchandise to the retail and wholesale
market and the export of United States magazine titles for distribution outside
of the United States.

“Funding Default” as defined in Section 2.21.

“Funding Notice” as defined in Section 2.1(b).

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

“General Intangible”
means general intangible (as that term is defined in the UCC).

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

 23
 

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

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

“Guaranteed Obligations”  as
defined in Section 7.1.

“Guarantor” means each Domestic Subsidiary of the
Borrower named in Schedule 1.1(f) or becomes party hereto at anytime
after the Closing Date pursuant to Section 5.11 or otherwise, that guarantees
all or any part of the Obligations.

“Guaranty” means the guaranty of each Guarantor set
forth in Section 7 and any other guaranty executed and delivered by a Guarantor
in favor of the Administrative Agent for the benefit of the Lenders and the
other Secured Parties, in form and substance reasonably satisfactory to the
Administrative Agent.

“Hazardous Materials” means any chemical, material or
substance, exposure to which is prohibited, limited or regulated by any
Governmental Authority or which may or could pose a hazard to the health and
safety of the owners, occupants or any Persons in the vicinity of any Facility
or to the indoor or outdoor environment.

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

“Hedge Agreement” means a Swap Contract entered into
with an Approved Counterparty in order to satisfy the requirements of this
Agreement or otherwise in the ordinary course of the Borrower’s or any of its
Subsidiaries’ businesses.

“Historical Financial Statements” means as of the
Closing Date, (i)(A) the audited financial statements of the Borrower and its
Subsidiaries, for the immediately preceding three Fiscal Years, consisting of
balance sheets and the related consolidated statements of income, stockholders’
equity and cash flows for such Fiscal Years, and (B) the unaudited financial
statements of the Borrower and its Subsidiaries as at the most recent Fiscal
Quarter ended not less than 45 days prior to the Closing Date, consisting
of a balance sheet and the related consolidated statements of income,
stockholders’ equity and cash flows for the three-, six- or nine-month period,
as applicable, ending on such date and (ii)(A) the audited financial statements
of Enthusiast Media and its Subsidiaries, for the immediately preceding three
Fiscal Years, consisting of balance sheets and the related consolidated
statements of income, stockholders’ equity and cash flows for such Fiscal
Years, and (B) the unaudited financial statements of Enthusiast Media and its
Subsidiaries as at the most recent Fiscal Quarter ended not less than
45 days prior to the Closing Date, consisting of a balance sheet and the
related consolidated statements of income, stockholders’ equity and cash flows
for the three-, six- or nine-month period, as applicable, ending on such date
and, in the case of clauses (i) and (ii), certified by the chief financial
officer of the Borrower that they fairly present, in all material respects, the
financial condition of the Borrower and its Subsidiaries as at the dates indicated
and the results of their operations and their cash flows for the periods indicated,
subject to changes resulting from audit and normal year-end adjustments.

 24
 

“Immaterial Subsidiary”
means any Subsidiary that has no revenues and that has total assets (including
the capital stock of other Subsidiaries), but excluding goodwill, of less than
$2,000,000 for all such Subsidiaries.

“In-Store Business
Segment” means the business and operations of the Borrower and its
Domestic Subsidiaries related to the design and manufacturing of custom wire
displays for periodicals, manufacturing wire racks for retailers, collecting
and managing rebates, other payments and returns on behalf of the Borrower, its
Subsidiaries and retailers, providing information, inventory management and consulting
services to retailers, and, in each case, services related to any the foregoing
conducted by the Borrower and its Domestic Subsidiaries.

“In-Store Services Accounts” means Accounts arising from goods
sold and services rendered by the In-Store Business Segments of the Credit
Parties including, without limitation, collecting rebates and other payments on
behalf of the Credit Parties and retailers, providing retail sales information
to retailers, manufacturing wire racks and, in each case, services related
thereto.

“In-Store Services Subline Amount” means an amount equal to
$40,000,000.

“Increased-Cost Lender” as defined in Section
2.22.

“Incurrence Test”
means a Fixed Charge Coverage Ratio of no greater than 2.0 to 1.0 as of the
date of the event giving rise to the application of the Incurrence Test.

“Indebtedness,” as applied to any Person, means, without
duplication, (i) all indebtedness for borrowed money; (ii) that
portion of obligations with respect to Capital Leases that is properly classified
as a liability on a balance sheet in conformity with GAAP; (iii) notes
payable and drafts accepted representing extensions of credit whether or not
representing obligations for borrowed money; (iv) any obligation owed for
all or any part of the deferred purchase price of property or services (excluding
any such obligations incurred under ERISA), which purchase price is
(a) due more than six months from the date of incurrence of the obligation
in respect thereof or (b) evidenced by a note or similar written instrument;
(v) all indebtedness secured by any Lien on any property or asset owned or
held by that Person regardless of whether the indebtedness secured thereby
shall have been assumed by that Person or is nonrecourse to the credit of that
Person; (vi) the face amount of any letter of credit issued for the account
of that Person or as to which that Person is otherwise liable for reimbursement
of drawings; (vii) the direct or indirect guaranty, endorsement (otherwise than
for collection or deposit in the ordinary course of business), co-making,
discounting with recourse or sale with recourse by such Person of the
obligation of another; (viii) any obligation of such Person the primary purpose
or intent of which is to provide assurance to an obligee that the obligation of
the obligor thereof will be paid or discharged, or any agreement relating
thereto will be complied with, or the holders thereof will be protected (in
whole or in part) against loss in respect thereof; (ix) the redemption,
repayment or other repurchase amount of such Person with respect to any
Disqualified Capital Stock of such Person or (if such Person is a Subsidiary of
the Borrower other than a Guarantor) any Preferred Stock of such Subsidiary,
but excluding, in each case, any accrued dividends (the amount of such
obligation to be equal at any time to the maximum fixed involuntary redemption,
repayment or repurchase price for such Capital Stock, or if less (or if such
Capital Stock has no such fixed price), to the involuntary redemption,
repayment or repurchase price therefor calculated in accordance with the terms
thereof as if then redeemed, repaid or repurchased, and if such price is based
upon or measured by the fair market value of such Capital Stock, such fair
market value shall be as determined in good faith by the Board of Directors or
the board of directors or other governing body of the issuer of such Capital
Stock), (x) any liability of such Person for an obligation of another through
any agreement (contingent or otherwise) (a) to purchase, repurchase or
otherwise acquire such obligation or any security therefor, or to provide funds
for the payment or discharge of such obligation (whether in the form of 

 25
 

loans, advances, stock purchases, capital
contributions or otherwise) or (b) to maintain the solvency or any balance
sheet item, level of income or financial condition of another if, in the case
of any agreement described under subclauses (a) or (b) of this clause (x), the
primary purpose or intent thereof is as described in clause (viii) above; (xi)
all obligations of such Person in respect of any exchange traded or over the
counter derivative transaction, including, without limitation, any Interest
Rate Agreement and Currency Agreement, whether entered into for hedging or speculative
purposes; and (xii) all Attributable Indebtedness; provided, for the
avoidance of doubt, future payment obligations under operating leases (as that
term is defined under GAAP) shall not be deemed Indebtedness; provided, further,
for the purposes of this Agreement, the Automotive.com Earn-Out Obligation and
any obligations related to the Automotive.com Put/Call Option shall not be
deemed Indebtedness.

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

“Indemnitee” as defined in Section 10.3.

“Intellectual Property”
as defined in the Pledge and Security Agreement.

“Intellectual Property
Security Agreement” as defined in the Pledge and Security Agreement.

“Intercreditor Agreement”
means that certain Intercreditor Agreement, dated as of August 1, 2007,
among the Borrower, the Guarantors, the Administrative Agent, the Collateral
Agent, the Term Loan Administrative Agent and the Term Loan Collateral Agent in
the form attached hereto as Exhibit N.

“Interest Payment Date” means with respect to (i) any
Revolving Loan that is a Base Rate Loan, the first Business Day of each Fiscal
Quarter commencing on September 30, 2007 and the Revolving Commitment Termination
Date and (ii) any Revolving Loan that is a Eurodollar Rate Loan, the last day
of each Interest Period applicable to such Loan and the Revolving Commitment
Termination Date; provided, in the case of each Interest Period of
longer than three months, “Interest Payment Date” shall also include each date
that is three months, or an integral multiple thereof, after the commencement
of such Interest Period.

“Interest Period” means, in connection with a Eurodollar
Rate Loan, an interest period of one, two, three or six months (or, if
available to all Lenders, one week or nine or twelve months), as selected by
the Borrower in the applicable Funding Notice or Conversion/Continuation
Notice, (i) initially, commencing 

 26
 

on the Credit Date or Conversion/Continuation Date
thereof, as the case may be; and (ii) thereafter, commencing on the day on
which the immediately preceding Interest Period expires; provided, (a)
if an Interest Period would otherwise expire on a day that is not a Business
Day, such Interest Period shall expire on the next succeeding Business Day
unless no further Business Day occurs in such month, in which case such
Interest Period shall expire on the immediately preceding Business Day; (b) any
Interest Period that begins on the last Business Day of a calendar month (or on
a day for which there is no numerically corresponding day in the calendar month
at the end of such Interest Period) shall, subject to clause (c), of this
definition, end on the last Business Day of a calendar month; and (c) no Interest
Period with respect to any portion of the Revolving Loans shall extend beyond
the Revolving Commitment Termination Date.

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

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

“Inventory”
means inventory (as that term is defined in the UCC).

“Investment” means (i) any direct or indirect
purchase or other acquisition by the Borrower or any of its Subsidiaries of, or
of a beneficial interest in, any of the Securities of any other Person (other
than a Guarantor); (ii) any direct or indirect redemption, retirement,
purchase or other acquisition for value, by any Subsidiary of the Borrower from
any Person (other than any Guarantor), of any Capital Stock of such Person; and
(iii) any direct or indirect loan, advance (other than advances to
employees for moving, entertainment and travel expenses, drawing accounts and
similar expenditures in the ordinary course of business) or capital
contributions by the Borrower or any of its Subsidiaries to any other Person
(other than any Guarantor), including all indebtedness and accounts receivable
from that other Person that are not current assets or did not arise from sales
to that other Person in the ordinary course of business.  The amount of any Investment shall be the
original cost of such Investment plus the cost of all additions thereto,
without any adjustments for increases or decreases in value, or write-ups,
write-downs or write-offs with respect to such Investment.

“Investment Grade Rating”  means
a rating equal to or higher than Baa3 (or the equivalent) by Moody’s and BBB- (or the equivalent) by S&P.

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

“Issuing Bank” means, collectively, (a) Citibank, N.A.
and, solely with respect to the Existing Letters of Credit, the applicable
issuer thereof as set forth on Schedule 2.3(k), (b) JPMorgan Chase Bank,
N.A. and (c) any Agent, Lender or Affiliate of such Agent or Lender that
hereafter becomes an Issuing Bank with the approval of the Administrative Agent
(not to be unreasonably conditioned, withheld or delayed) and the Borrower by
agreeing pursuant to an agreement with and in form and substance reasonably
satisfactory to the Administrative Agent and the Borrower to be bound by the
terms hereof applicable to Issuing Banks, in each case, together with its
permitted successors and assigns in such capacity.

“Joint Lead Arrangers” means CGMI and JPMSI, in their
capacities as joint lead arrangers and joint bookrunners for the Revolving
Credit Facility.

 27
 

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

“JPMCB” means
JPMorgan Chase Bank, N.A.

“JPMSI” means
J.P. Morgan Securities, Inc.

“Landlord Access Agreement” means a Landlord Waiver and
Consent Agreement substantially in the form of Exhibit K with such
amendments or modifications as may be reasonably satisfactory to the
Administrative Agent.

“Leasehold Property”  means any leasehold interest of any Credit Party as lessee
under any lease of real property.

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

“Letter of Credit” means each Documentary Letter of
Credit and Standby Letter of Credit issued by any Issuing Bank pursuant to this
Agreement.

“Letter of Credit
Obligations” means, at any time, the aggregate of all liabilities at
such time of the Borrower to all Issuing Banks with respect to Letters of
Credit, whether or not any such liability is contingent, including, without
duplication, the Letter of Credit Usage at such time.

“Letter of Credit
Reimbursement Agreement” as defined in Section 2.3(a)(vi).

“Letter of Credit Sublimit” means the lesser of (i)
$50,000,000 and (ii) the aggregate unused amount of the Revolving Commitments
then in effect.

“Letter of Credit Undrawn
Amounts” means, at any time, the aggregate undrawn face amount of
all Letters of Credit outstanding at such time.

“Letter of Credit Usage” means, as at any date of
determination, the sum of (i) the Letter of Credit Undrawn Amounts at such time
and (ii) the outstanding Reimbursement Obligations at such time.

“Lien” means (i) any lien, mortgage, pledge, assignment,
security interest, charge or encumbrance of any kind (including any agreement
to give any of the foregoing, any conditional sale or other title retention
agreement, and any lease in the nature thereof) and any option, trust or other
preferential arrangement having the practical effect of any of the foregoing
and (ii) in the case of Securities, any purchase option, call or similar right
of a third party with respect to such Securities.

“Liquidity Event Period”
means any period (a) beginning on the fourth Business Day on which (i) the
Excess Availability is less than the greater of (a) $20,000,000 and
(b) 10% of the Borrowing Base or (ii) an Event of Default has occurred and
is continuing and (b) ending on the first Business Day on which (i) the Excess
Availability is greater than the greater of (a) $20,000,000 and
(b) 10% of the Borrowing Base for more than 10 consecutive days and (ii)
no Event of Default has occurred and is continuing.

“Loan” means a Revolving Loan, a Swing Line Loan or a
Protective Advance.

 28

 

“Magazine
Distribution Business Segment” means the business and operations of
the Borrower and its Domestic Subsidiaries related to the distribution of
magazines, confections and related general merchandise to the retail and
wholesale market and, in each case, services related to any the foregoing
conducted by the Borrower and its Domestic Subsidiaries.

“Magazine
Publication Business Segment” means the business and operations of
the Borrower and its Domestic Subsidiaries related to the creation, licensing and
publication of magazines, websites and related content, including without
limitation the business of Enthusiast Media and its Subsidiaries, and, in each
case, services and events related to any the foregoing conducted, managed or
sponsored by the Borrower and its Domestic Subsidiaries.

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

“Material Adverse Effect” means a material adverse
effect on and/or material adverse developments with respect to (i) the
business, operations, properties, assets, financial condition, results of operations
of the Borrower and its Subsidiaries taken as a whole; (ii) the legality,
validity, binding effect or enforceability against a Credit Party of a Credit
Document to which it is a party; or (iii) the rights and remedies available
to any Agent and any Lender or any Secured Party under any Credit Document.

“Material Contract” means any contract or other
arrangement to which the Borrower or any of its Subsidiaries is a party (other
than the Credit Documents) for which breach, nonperformance, cancellation or
failure to renew could reasonably be expected to have a Material Adverse
Effect.

“Material Real Estate Asset” means (i) in the case of
Real Estate Assets on the Closing Date, each fee-owned Real Estate Asset and
(ii) in the case of Real Estate Assets acquired or constructed after the Closing
Date, each fee-owned Real Estate Asset having a fair market value in excess of
$2,500,000 as of the date of the acquisition or completion of construction
thereof.

“Maximum Credit”
means, at any time, (a) the lesser of (i) the Revolving Commitments
in effect at such time and (ii) the Borrowing Base at such time minus (b) the aggregate amount of any Availability
Reserve in effect at such time.

“Moody’s” means Moody’s Investors Service, Inc.

“Mortgage” means a Mortgage substantially in the form of
Exhibit J, as it may be amended, supplemented or otherwise modified from
time to time.

“Mortgaged Property” means a Closing Date Mortgaged Property or
an After-Acquired Mortgaged Property.

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

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

“Narrative Report” means, with respect to the financial
statements for which such narrative report is required, a narrative report
describing the operations of the Borrower and its Subsidiaries in the form
prepared for presentation to senior management thereof for the applicable
month, Fiscal Quarter or Fiscal Year and for the period from the beginning of
the then current Fiscal Year to the end of such period to which such financial
statements relate (it being understood that the “Management’s Discussion and 

 29
 

Analysis of Financial Condition and Results of
Operations” required by Item 303 of Regulation S-K under the Securities Act
shall constitute a satisfactory Narrative Report).

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

“Net Insurance/Condemnation Proceeds” means an amount
equal to:  (i) any Cash payments or
proceeds received by the Borrower or any of its Subsidiaries (a) under any
casualty insurance policy in respect of a covered loss thereunder or (b) as a
result of the taking of any assets of the Borrower or any of its Subsidiaries
by any Person pursuant to the power of eminent domain, condemnation or otherwise,
or pursuant to a sale of any such assets to a purchaser with such power under
threat of such a taking, minus
(ii) (a) any actual and reasonable costs incurred by the Borrower or any
of its Subsidiaries in connection with the adjustment or settlement of any
claims of the Borrower or such Subsidiary in respect thereof, and (b) any bona
fide direct costs incurred in connection with any sale of such assets as
referred to in clause (i)(b) of this definition, including income taxes payable
as a result of any gain recognized in connection therewith.

“Net Issuance Proceeds”  means
an amount equal to the excess of (i) any Cash payments or proceeds
received by the Borrower or any of its Subsidiaries in connection with such
issuance over (ii) all taxes and fees (including investment banking fees,
underwriting discounts, commissions, costs and other out-of-pocket expenses and
other customary expenses) incurred by the Borrower or such Subsidiary in
connection with such issuance.

“Net Orderly Liquidation
Value” means the orderly liquidation value (net of costs and expenses
incurred in connection with liquidation) of Inventory as a percentage of the
cost of such Inventory, which percentage shall be determined by reference to most recent appraisal performed by an
Acceptable Appraiser of such Inventory received by the Administrative
Agent.

“New Term Loan Incurrence
Level” means a Senior Secured Leverage Ratio of no greater than the
ratios set forth below as of the date of the incurrence of such New Term Loans
on a date in a Fiscal Quarter ending on the dates set forth below. 

	
  Period

  	
   

  	
  Senior Secured Leverage Ratio

  
	
   

  	
   

  	
   

  
	
  October 31, 2007

  	
   

  	
  5.25:1.0

  
	
  January 31, 2008

  	
   

  	
  5.25:1.0

  
	
  April 30, 2008

  	
   

  	
  5.25:1.0

  
	
  July 31, 2008

  	
   

  	
  5.25:1.0

  
	
  October 31, 2008

  	
   

  	
  5.25:1.0

  
	
  January 31, 2009

  	
   

  	
  5.25:1.0

  
	
  April 30, 2009

  	
   

  	
  5.25:1.0

  

 

 30
 

 

	
  Period

  	
   

  	
  Senior Secured Leverage Ratio

  
	
   

  	
   

  	
   

  
	
  July 31, 2009

  	
   

  	
  5.00:1.0

  
	
  October 31, 2009

  	
   

  	
  5.00:1.0

  
	
  January 31, 2010

  	
   

  	
  4.75:1.0

  
	
  April 30, 2010

  	
   

  	
  4.75:1.0

  
	
  July 31, 2010

  	
   

  	
  4.50:1.0

  
	
  October 31, 2010

  	
   

  	
  4.50:1.0

  
	
  January 31, 2011
  and thereafter.

  	
   

  	
  4.25:1.0

  

 

“New Term Loans”  as defined in the Term Loan Agreement.

“Non-Consenting Lender”  as defined in Section 2.22.

“Nonpublic Information”
means information which has not been disseminated in a manner making it
available to investors generally, within the meaning of Regulation FD.

“Non-US Lender” as defined in Section 2.19(e).

“Note” means a Revolving Loan Note or a Swing Line Note.

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

“Obligations” means all obligations of every nature of
each Credit Party under the Credit Documents and the Related Obligation
Documents, including obligations from time to time owed to the Agents
(including former Agents), the Lenders or any of them and Approved
Counterparties or any of them, under any Credit Document or Related Obligation
Document, whether for principal, interest (including interest which, but for
the filing of a petition in bankruptcy with respect to such Credit Party, would
have accrued on any Obligation, whether or not a claim is allowed against such
Credit Party for such interest in the related bankruptcy proceeding),
reimbursement of amounts drawn under Letters of Credit, payments for early
termination of Hedge Agreements, Secured Party Expenses, fees, expenses,
indemnification or otherwise.

“Obligee Guarantor” as defined in Section 7.7.

“Organizational Documents” means (i) with respect to any
corporation, its certificate or articles of incorporation or organization, as
amended, and its by-laws, as amended, (ii) with respect to any limited
partnership, its certificate of limited partnership, as amended, and its
partnership agreement, as amended, (iii) with respect to any general
partnership, its partnership agreement, as amended, and (iv) with respect to
any limited liability company, its articles of organization, as amended, and
its operating agreement, as amended.  In
the event any term or condition of this Agreement or any other Credit Document
requires any Organizational Document to be certified by a secretary of state or
similar governmental official, the reference to any such “Organizational
Document” shall only be to a document of a type customarily certified by such
governmental official.

“Other Tax” means any
and all present or future stamp or documentary taxes or any other excise or
property taxes, charges or similar levies (including any interest, additions to
tax or penalties applicable thereto) arising from any payment made or required
to be made hereunder or under any other Credit

 31
 

Document or from the execution, delivery or enforcement
of, or otherwise with respect to, this Agreement or any other Credit Document.

“Patriot Act”
means the USA Patriot Act of 2001 (31 U.S.C. 5318 et seq.).

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

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

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

“Permanent Financing”
means the issuance by the Borrower of (i) any unsecured Indebtedness
refinancing the Bridge Loans described in clause (i) of the definition thereof
and which (x) matures not less than 180 days after the final maturity of the
Term Loans and (y) would satisfy clause (a) of the proviso to the definition of
“Permitted Refinancing” with respect to the Bridge Loans described in clause
(i) of the definition thereof or (ii) Capital Stock (other than Disqualified
Capital Stock) of the Borrower for cash, in each case solely to the extent the
Net Issuance Proceeds of such issuance are applied to repay the then outstanding
Bridge Loans described in clause (i) of the definition thereof, together with
accrued and unpaid interest thereon and fees and expenses related to such
repayment.

“Permitted Acquisition” means any Acquisition by the
Borrower or any of its wholly-owned Subsidiaries; provided, that:

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

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

(iii)          in the case of the Acquisition of
Capital Stock, all of the Capital Stock (except for any such Securities in the
nature of directors’ qualifying shares required pursuant to applicable law)
acquired or otherwise issued by such Person or any newly formed Subsidiary of
the Borrower in connection with such Acquisition shall be owned 100% by a
Borrower or a Guarantor thereof, and the Borrower shall have taken, or caused
to be taken, as of the date such Person becomes a Subsidiary of the Borrower,
each of the actions set forth in Sections 5.11 and/or 5.12, as applicable;

(iv)          the Borrower and its Subsidiaries
shall be in compliance with the Incurrence Test after giving effect to such
Acquisition;

(v)           the Borrower shall have delivered to
the Administrative Agent (A) at least 10 Business Days prior to such proposed
Acquisition, a Compliance Certificate evidencing compliance with the Incurrence
Test as required under clause (iv) above, together with all relevant financial
information with respect to such acquired assets, including, without
limitation, the aggregate consideration for such Acquisition and any other
information required to demonstrate compliance with the Incurrence Test;

 32
 

(vi)          the Excess Availability, determined on
a pro forma basis after giving effect to
such Acquisition, shall not be less than $100,000,000;

(vii)         with respect to any transaction
involving Acquisition Consideration of more than $25,000,000, unless the
Administrative Agent shall otherwise agree, the Borrower shall have provided
the Administrative Agent and the Lenders with audited historical financial
statements of the person or business to be acquired, if available, and
unaudited financial statements thereof for the most recent interim period which
are available;

(viii)        any business or lines of business of any
Person or assets or division acquired in accordance herewith shall be permitted
by Section 6.12; and

(ix)           the Board of Directors of the person
to be acquired shall not have indicated publicly its opposition to the
consummation of such acquisition (which opposition has not been publicly withdrawn).

“Permitted Asset Swap”
means any transfer of property or assets by the Borrower or any of its
Subsidiaries in which at least 90% of the consideration received by the
transferor consists of properties or assets (other than cash) that will be used
in a business or business activity permitted under Section 6.12; provided that the aggregate fair market value
of all such property or assets being transferred by the Borrower or such
Subsidiary since the Closing Date (x) shall not exceed $25,000,000 in the aggregate
and (y) is not greater than the aggregate fair market value of the property or
assets received by the Borrower or such Subsidiary in such exchange; provided  further
that such market value of the property or assets being transferred or received
by the Borrower or such Subsidiary shall be made in good faith by management of
the Borrower.

“Permitted Discretion”
means a determination made in good faith and in the exercise of reasonable
business judgment in accordance with customary business practices for
comparable asset based lending transactions.

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

“Permitted Refinancing”
means (i) renewals and extensions expressly provided for in the agreements
evidencing any such Indebtedness as the same are in effect on the date of this
Agreement and (ii) refinancings and extensions of any such Indebtedness if the
terms and conditions thereof are not materially less favorable to the obligor
thereon or to the Lenders than the Indebtedness being refinanced or extended,
and the average life to maturity thereof is greater than or equal to that of
the Indebtedness being refinanced or extended, and the final maturity thereof
is equal to or later than the Indebtedness being refinanced or extended; provided,
that (a) such Indebtedness permitted under the immediately preceding clause (i)
or (ii) above shall not (A) include Indebtedness of an obligor that was not an
obligor with respect to the Indebtedness being extended, renewed or refinanced,
(B) exceed in a principal amount the principal amount of Indebtedness being
renewed, extended or refinanced plus interest, premium and reasonable
transaction costs and fees and expenses, if any, paid in connection with such
renewal extension or refinancing or (C) be incurred, created or assumed if any
Default or Event of Default has occurred and is continuing or would result
therefrom and (b) if the Indebtedness being modified, refinanced, refunded,
renewed or extended is subordinated in right of payment to the Obligations,
such modification, refinancing, refunding, renewal or extension is subordinated
in right of payment to the Obligations on terms at least as favorable to the
Lenders as those contained in the documentation governing the Indebtedness being
modified, refinanced, refunded, renewed or extended.

 33
 

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

“Phase I Report”
means, with respect to any Facility,  a
report that (i) conforms to the ASTM Standard Practice for Environmental Site
Assessments:  Phase I Environmental Site
Assessment Process, E 1527, as amended, (ii) was conducted no more than six
months prior to the date such report is required to be delivered hereunder, by
one or more environmental consulting firms reasonably satisfactory to the Agents,
(iii) includes an assessment of asbestos containing materials at such Facility,
(iv) is accompanied by (a) an estimate of the reasonable worst case cost of
investigating and remediating any Hazardous Materials Activity identified in
the Phase I Report as giving rise to an actual or potential material violation
of any Environmental Law or as presenting a material risk of giving rise to a
material Environmental Claim, and (b) a current compliance audit setting forth
an assessment of the Borrower’s, its Subsidiaries’ and such Facility’s current
and past compliance with Environmental Laws and an estimate of the cost of rectifying
any non compliance with current Environmental Laws identified therein and the
cost of compliance with reasonably anticipated future Environmental Laws
identified therein.

“Platform” as
defined in Section 9.9(a).

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

“Pledge and Security
Agreement Collateral” shall mean all property pledged or granted as
collateral pursuant to the Pledge and Security Agreement (a) on the Closing
Date or (b) thereafter pursuant to Section 5.11.

“Preferred Stock”
means, with respect to any person, any and all preferred or preference Capital
Stock (however designated) of such person whether now outstanding or issued
after the Closing Date.

“Principal Office” means, for each of the Administrative
Agent, the Swing Line Lender and each Issuing Bank, such Person’s “Principal
Office” as set forth on Appendix B, or such other office or office of a third
party or sub-agent, as appropriate, as such Person may from time to time
designate in writing to the Borrower, the Administrative Agent and each Lender.

“Proceeds” has
the meaning given such term in the UCC.

“Projections” as defined in Section 4.8.

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

“Protective Advance” as defined in Section 2.1(c).

 34
 

“Purchase” means the acquisition by the Borrower of the
Acquired Business pursuant to the Acquisition Agreement.

“Qualified Capital Stock”
of any Person means any Capital Stock of such Person that is not Disqualified
Capital Stock.

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

“Refinancing”
means the repayment in full and the termination of any commitment to make extensions
of credit under all of the outstanding indebtedness and other obligations set
forth on Schedule 1.1(d) of the Borrower or any of its Subsidiaries
on the Closing Date.

“Register” as defined in Section 2.6(c).

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

“Regulation FD”
means Regulation FD as promulgated by the US Securities and Exchange Commission
under the Securities Act and Exchange Act as in effect from time to time.

“Reimbursement Date” as defined in Section 2.3(h).

“Reimbursement Obligations”
means, as and when matured, the obligation of the Borrower to pay, on the date
payment is made to the beneficiary under each such Letter of Credit (or at such
other date as may be specified in the applicable Letter of Credit Reimbursement
Agreement) and in the currency drawn (or in such other currency as may be
specified in the applicable Letter of Credit Reimbursement Agreement), all
amounts of each draft and other request for payments drawn under Letters of
Credit, and all other matured reimbursement or repayment obligations of the
Borrower to any Issuing Bank with respect to amounts drawn under Letters of
Credit.

“Reinvestment Notice”
as defined in Section 2.14(a).

“Related Agreements” means, collectively, the
Acquisition Agreement and the Yucaipa Management Agreement.

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

“Related Obligation
Document” means, collectively, each Hedge Agreement and each Cash
Management Document.

“Related Obligations”
as defined in Section 9.10.

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

 35
 

“Rent Reserve” means a reserve in the amount of three-months
rent established by the Administrative Agent for each Leasehold Property
location set forth in Schedule 1.1(e) or any additional Leasehold
Property for which a Collateral Access Agreement is required; provided
that the reserve established for any such location shall be reduced to zero on
the date that (i) a Collateral Agent shall receive a Collateral Access Agreement
for such location or (ii) Inventory is no longer located at such location.

“Replacement Lender” as defined in Section 2.22.

“Requisite Lenders”
means one or more Lenders having or holding Revolving Credit Exposure and
representing more than 50% of the sum of the aggregate Revolving Credit
Exposure (other than Protective Advances) of all Lenders.

“Reserves” means all, if any, Availability Reserves,
Rent Reserves, Eligibility Reserves, Dilution Reserves and any and
all other reserves which the Agent deems necessary in its Permitted Discretion
to maintain with respect to Eligible Receivables or Eligible Inventory that
have been established in accordance with Section 2.23 including warranty
reserves, it being understood that Reserves on the Closing Date shall be
equal to $95,690,766.

“Restricted Junior Payment” means (i) any dividend
or other distribution, direct or indirect, on account of any shares of any
class of stock of the Borrower now or hereafter outstanding, except a dividend
payable solely in shares of that class of stock to the holders of that class;
(ii) any redemption, retirement, sinking fund or similar payment, purchase
or other acquisition for value, direct or indirect, of any shares of any class
of stock of the Borrower now or hereafter outstanding and (iii) any payment
made to retire, or to obtain the surrender of, any outstanding warrants,
options or other rights to acquire shares of any class of stock of the Borrower
now or hereafter outstanding.

“Revolving Commitment” means the commitment of a Lender
to make or otherwise fund any Revolving Loan and to acquire participations in
Letters of Credit and Swing Line Loans hereunder and “Revolving Commitments”  means
such commitments of all Lenders in the aggregate.  The amount of each Lender’s Revolving
Commitment is set forth on Appendix A-3 or in the applicable Assignment
Agreement, subject to any adjustment or reduction pursuant to the terms and
conditions hereof.  The aggregate amount
of the Revolving Commitments as of the Closing Date is $300,000,000.

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

“Revolving Commitment Termination Date” means the
earliest to occur of (i) the sixth anniversary of the Closing Date, (ii) the
date the Revolving Commitments are permanently reduced to zero pursuant to
Section 2.12 or 2.13, and (iii) the date of the termination of the Revolving
Commitments pursuant to Section 8.1.

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

 36
 

Protective Advances at such time; provided that
the amount of outstanding Protective Advances shall be disregarded solely for
the purpose of calculating Excess Availability and solely to the extent the
inclusion of such Protective Advance would result in the beginning of a
Liquidity Event Period.

“Revolving Credit Facility” means the Revolving Commitments and
the provisions herein related to the Revolving Loans, Swing Line Loans and
Letters of Credit.

“Revolving Credit
Outstandings” means, at any particular time, the sum of (a) the
principal amount of the Revolving Loans outstanding at such time, (b) the
Letter of Credit Usage outstanding at such time, (c) the principal amount of
the Swing Line Loans outstanding at such time and (d) the principal amount of
the Protective Advances outstanding at such time.

“Revolving Loan”  as defined in Section 2.1(a).

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

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

“Sale and Leaseback
Transactions” as defined in Section 6.10.

“Scan-Based Trading”
means an arrangement between a distributor and a retailer whereby goods are
delivered by the distributor to the retailer and the retailer is under no obligation
to pay for any such good until such time as a retail customer purchases such
good from the retailer or such good is not timely returned to the distributor.

“Second Priority” means, with respect to any Lien
purported to be created in any Fixed Asset Collateral pursuant to any
Collateral Document, that such Lien is subordinated solely to the Liens on such
Collateral created by the Term Loan Credit Documents and any Permitted Lien.

“Secured Parties” means, collectively, the Lenders, the Issuing
Banks, the Facility Agents and each Approved Counterparty.

“Secured Party Expenses” means all (a) costs or expenses
(including taxes, and insurance premiums) required to be paid by a Credit Party
or its Subsidiaries under any of the Credit Documents that are paid, advanced,
or incurred by the Secured Parties, (b) fees or charges paid or incurred by the
Administrative Agent or Collateral Agent in connection with the Secured Parties’
transactions with the Credit Parties or their Subsidiaries, including fees or
charges for photocopying, notarization, couriers and messengers,
telecommunication, public record searches (including tax lien, litigation, and
UCC searches and including searches with the patent and trademark office, the
copyright office, or the department of motor vehicles), filing, recording,
publication, and appraisal (including periodic collateral appraisals or
business valuations to the extent of the fees and charges (and up to the amount
of any limitation) contained in this Agreement), (c) costs and expenses
incurred by the Administrative Agent in the disbursement of funds to or for the
account of Borrower or other Secured Parties (by wire transfer or otherwise),
(d) charges paid or incurred by the Administrative Agent resulting from the dishonor
of checks, (e) reasonable costs and expenses paid or incurred by the Secured
Parties to correct any default or enforce any provision of the Credit
Documents, or in gaining possession of, maintaining, handling, preserving,
storing, shipping, selling, preparing for sale, or advertising to sell the
Collateral, or any portion thereof, irrespective of whether a sale is
consummated, (f) audit fees and expenses of the Administrative Agent related to
audit examinations of the Books to the extent of the fees and charges (and up
to the amount of any limitation) contained in this Agreement, (g) per diem
expenses and out-of-pocket expenses of the Administrative Agent’s internal 

 37
 

field examiners, (h)
reasonable costs and expenses of third-party claims or any other suit paid or incurred
by the Secured Parties in enforcing or defending the Credit Documents or in
connection with the transactions contemplated by the Credit Documents or the
Secured Parties’ relationship with any Credit Party or any Subsidiary of a
Credit Party, (i) the Administrative Agent’s, Collateral Agent’s and each
Lender’s reasonable costs and expenses (including reasonable attorneys fees)
incurred in advising, structuring, drafting, reviewing, administering,
syndicating, or amending the Credit Documents, and (j) the Administrative Agent’s
and each Lender’s reasonable costs and expenses (including reasonable attorneys’,
accountants’, consultants’, and other advisors’ fees and expenses) incurred in
terminating, enforcing (including attorneys’, accountants’, consultants’, and
other advisors’ fees and expenses incurred in connection with a “workout,” a “restructuring,”
or an insolvency proceeding concerning any Credit Party or any Subsidiary of a
Credit Party or in exercising rights or remedies under the Credit Documents),
or defending the Credit Documents, irrespective of whether suit is brought, or
in taking any remedial action concerning the Collateral.  All out-of-pocket expenses of the Lenders,
Collateral Agent and/or Administrative Agent payable by the Credit Parties
shall be set forth in a reasonably detailed invoice.  The Borrower will have access to any
Inventory appraisal for which Borrower has reimbursed the Lenders, the
Administrative Agent or the Collateral Agent for the costs therefor.

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

“Securities Account”  has
the meaning given to such term in the UCC.

“Securities Account Control Agreement”  has the meaning specified in the Pledge
and Security Agreement.

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

“Segment A Designated
Accounts” means each entity set forth on Schedule 1.1(h)(A)
and its affiliates.

“Segment B Designated
Accounts” means each entity set forth on Schedule 1.1(h)(B)
and its affiliates.

“Segment C Designated
Accounts” means each entity set forth on Schedule 1.1(h)(C)
and its affiliates.

“Segment D Designated
Accounts” means each entity set forth on Schedule 1.1(h)(D)
and its affiliates.

“Seller” means
Consumer Source Inc., a Delaware corporation.

“Senior Secured Leverage
Ratio” means, at any date of determination, the ratio of (i) (x) Consolidated
Total Debt (other than the Loans) that is secured by any assets of the Borrower
or any of its Subsidiaries on such date plus (y) the average of Loans
outstanding on the end of each of the four immediately preceding Fiscal
Quarters (or if such date of determination occurs during the three Fiscal
Quarters after the Closing Date, the Loans outstanding on such date) to (ii)
Consolidated Adjusted EBITDA for the 

 38
 

four-Fiscal Quarter period ending on such date
(or if such date of determination is not the last day of a Fiscal Quarter, for
the four-Fiscal Quarters period ending as of the most recently concluded Fiscal
Quarter).

For purposes of making the computation referred to
above, Investments, acquisitions, dispositions, mergers, consolidations and
disposed operations (as determined in accordance with GAAP) that have been made
by the Borrower or any Subsidiary during the four-quarter reference period or
subsequent to such reference period and on or prior to or simultaneously with
the date of determination shall be calculated on a pro forma
basis assuming that all such Investments, acquisitions, dispositions, mergers,
consolidations and disposed operations (and the change in any associated
indebtedness and the change in Consolidated Adjusted EBITDA resulting
therefrom) had occurred on the first day of the reference period.  If since the beginning of such period any Person
(that subsequently became a Subsidiary or was merged with or into the Borrower
or any Subsidiary since the beginning of such period) shall have made any
Investment, acquisition, disposition, merger, consolidation or disposed
operation that would have required adjustment pursuant to this definition, then
the Senior Secured Leverage Ratio shall be calculated giving pro forma effect thereto for such period as if such
Investment, acquisition, disposition, merger, consolidation or disposed
operation had occurred at the beginning of the reference period.

For purposes of this definition, whenever pro forma effect is to be given to a transaction, the pro forma calculations shall be made in good faith by a
responsible financial or accounting officer of the Borrower and, for any fiscal
period ending on or prior to the first anniversary of an asset acquisition,
asset disposition, discontinued operation or operational change, may include
adjustments to reflect operating expense reductions and other operating improvements
or synergies reasonably expected to result from such asset acquisition, asset
disposition, discontinued operation or operational change, for purposes of
determining compliance with the Senior Secured Leverage Ratio and achievement
of other financial measures provided for herein, such adjustments may reflect
additional operating expense reductions and other additional operating
improvements and synergies that would not be includable in pro forma
financial statements prepared in accordance with Regulation S-X but for which
substantially all of the steps necessary for the realization thereof have been
taken or are reasonably anticipated by the Borrower to be taken in the next
12-month period following the consummation thereof and, are estimated on a good
faith basis by the Borrower; provided,  however,
(i) that the pro forma effect of all such
adjustments arising out of the Transactions and certain acquisitions
consummated prior to the Closing Date and listed on Schedule 1.1(b)
hereto on Consolidated Adjusted EBITDA for Fiscal Quarters ending prior to the
Closing Date have been fully reflected in the stipulated amounts for such
Fiscal Quarters set forth in the definition of “Consolidated Adjusted EBITDA”
and no such further adjustment in respect of such transactions shall be made
pursuant to this paragraph; and (ii) that the aggregate amount of any such
adjustments other than in respect of the Transactions and such transactions
listed on Schedule 1.1(b) hereto shall not exceed five percent (5%) of
Consolidated Adjusted EBITDA of the Borrower in any reference period.  The Borrower shall deliver to the Administrative
Agent a certificate of a Financial Officer of the Borrower setting forth such
demonstrable or additional operating expense reductions and other operating
improvements or synergies and information and calculations supporting them in
reasonable detail.

“Slow Moving Inventory”
means, as of the date of determination, the excess (if any) of (i) the dollar
value of any Inventory aged more than eighteen months from the “street date” of
such Inventory over (ii) the dollar value of such Inventory sold in the
preceding eighteen months.

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

“Solvent” means, with respect to any Credit Party, that
as of the date of determination, (a) the sum of such Credit Party’s debt
(including contingent liabilities) does not exceed the present fair saleable 

 39
 

value of such Credit Party’s present assets; (b) such
Credit Party’s capital is not unreasonably small in relation to its business as
contemplated on the Closing Date and reflected in the Projections or with respect
to any transaction contemplated or undertaken after the Closing Date; and (c)
such Credit Party has not incurred and does not intend to incur, or believe
(nor should it reasonably believe) that it will incur, debts beyond its ability
to pay such debts as they become due (whether at maturity or otherwise).  For purposes of this definition, the amount
of any contingent liability at any time shall be computed as the amount that,
in light of all of the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an actual or
matured liability (irrespective of whether such contingent liabilities meet the
criteria for accrual under Statement of Financial Accounting Standard No. 5).

“Standby Letter of Credit”
means any Letter of Credit that is not a Documentary Letter of Credit.

“Subsidiary” means, with respect to any Person, any
corporation, partnership, limited liability company, association, joint venture
or other business entity of which more than 50% of the total voting power of
shares of stock or other ownership interests entitled (without regard to the
occurrence of any contingency) to vote in the election of the Person or Persons
(whether directors, managers, trustees or other Persons performing similar
functions) having the power to direct or cause the direction of the management and
policies thereof is at the time owned or controlled, directly or indirectly, by
that Person or one or more of the other Subsidiaries of that Person or a
combination thereof; provided, in determining the percentage of ownership
interests of any Person controlled by another Person, no ownership interest in
the nature of a “qualifying share” of the former Person shall be deemed to be
outstanding.  Unless otherwise specified,
all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a
Subsidiary or Subsidiaries of the Borrower; provided, further, until the
exercise of the Automotive.com Put/Call Option and the closing of the share
purchase pursuant thereto, Automotive.com shall not be deemed a Subsidiary of
any Credit Party.

“Supermajority Lenders”
shall mean, at any date, (a) Lenders having or holding at least 75% of the
Revolving Credit Commitment at such date or (b) if the Revolving Credit
Commitment has been terminated, Lenders having or holding at least 75% of the
outstanding principal amount of the Loans and Letter of Credit Exposure (excluding
the Loans and Letter of Credit Exposure of Defaulting Lenders) in the aggregate
at such date.

“Swap Contract”
means collectively, each Interest Rate Agreement and each Currency Agreement.

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

“Swing Line Lender” means CNAI, in its capacity as Swing
Line Lender hereunder, together with its permitted successors and assigns in
such capacity.

“Swing Line Loan” as defined in Section 2.2.

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

 40
 

“Swing Line Request” as defined in Section 2.2(b).

“Swing Line Sublimit” means the lesser of (i)
$25,000,000, and (ii) the Excess Availability then in effect.

“Syndication Agent” as defined in the preamble hereto.

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

“Terminated Lender”  as defined in Section 2.22.

“Term Loan Administrative
Agent” means CNAI, in its capacity as administrative agent under the
Term Loan Agreement, together with its permitted successors in such capacity.

“Term Loan Agreement”
means that certain Term Loan and Guaranty Agreement, dated as of August 1,
2007, among the Borrower, the guarantors party thereto, the Term Loan
Administrative Agent, the Term Loan Collateral Agent, the financial
institutions party thereto, J.P. Morgan Chase Bank, N.A., as syndication agent,
and CGMI and J.P. Morgan Securities Inc., as joint lead arrangers and joint
bookrunners, together with any agreements or instruments entered into from time
to time in connection with any refinancing, restatement, replacement or
refunding, in whole or in party, of the obligations incurred thereunder.

“Term Loan Collateral Agent”
means CNAI, in its capacity as collateral agent under the Term Loan Agreement,
together with its permitted successors in such capacity.

“Term Loan Credit Documents”
has the meaning given to the term “Credit Documents” in the Term Loan
Agreement.

“Term Loans” has
the meaning given to the term “Loans” in the Term Loan Agreement.

“Term Loan Secured Parties”
has the meaning given to the term “Secured Parties” in the Term Loan Agreement.

“Title Policy” as defined in Section 3.1(h)(iii).

“Transaction Documents” means
the Acquisition Documents, the Term Loan Credit Documents, Bridge Loan
Documents and the Credit Documents.

“Transactions”
means the Purchase, the Refinancing, the initial borrowings under the Term Loan
Agreement, the Bridge Loan Agreement and this Agreement, and the payments of
fees, commissions and expenses in connection with each of the foregoing.

 41
 

“Type of Loan” means (i) with respect to the Revolving
Loans, a Base Rate Loan or a Eurodollar Rate Loan, and (ii) with respect to
Swing Line Loans and Protective Advances, a Base Rate Loan.

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

“US Marketing Services”
means Source-U.S. Marketing Services, Inc., a Delaware corporation.

“Vendor” means
each vendor that sells Inventory and extends trade credit to one or more Credit
Parties from time to time and has a Lien on any such Inventory.

“Vendor Agreements”
means the Vendor Supply Agreements and the Vendor Security Agreements.

“Vendor Intercreditor
Agreement” means any intercreditor agreement entered into by and between
the Collateral Agent and a Vendor, in form and substance satisfactory to the
Administrative Agent.

“Vendor Lien”
means a Lien of a Vendor solely on certain Inventory of one or more Credit Parties
as more precisely described in and granted pursuant to the applicable Vendor
Security Agreement; provided, however, that any such Inventory
subject to a Vendor Lien shall be deemed Eligible Inventory hereunder (subject
to the other criteria set forth in the definition of such term) only for the
60-day period following the Closing Date unless the Administrative Agent shall
have received (a) an officer’s certificate certifying that, as to such Vendor,
(i) attached thereto are true, correct and complete copies of all applicable
Vendor Agreements between such Credit Parties and such Vendor, and (ii) all
such Vendor Agreements are in full force and effect; and (b) a duly executed
Vendor Intercreditor Agreement from such Vendor.

“Vendor Security Agreement”
means a security agreement between one or more Credit Parties and a Vendor,
regarding a Lien solely on certain Inventory of one or more Credit Parties.

“Vendor Supply Agreement”
means each agreement (excluding purchase orders) executed by one or more Credit
Parties and a Vendor regarding current and future trade terms.

“Voluntary Cash Management
Period” means any period, after which the Borrower gives notice to
such effect to the Administrative Agent, and during which the Borrower
voluntarily complies with the procedures set forth in Section 2.13(d) regarding
application of funds from the Concentration Account and Cash Collateral
Account.

“Wachovia” means Wachovia Bank, National Association.

“Wells Fargo” means Wells Fargo Foothill, LLC.

“Yucaipa” means
The Yucaipa Companies LLC, a Delaware limited liability company.

“Yucaipa Management
Agreement” means that certain Consulting Agreement dated as of February
28, 2005, between Yucaipa and the Borrower, as may be amended from time to
time.

1.2          Accounting
Terms.  Except
as otherwise expressly provided herein, all accounting terms not otherwise
defined herein shall have the meanings assigned to them in conformity with
GAAP.  Financial statements and other
information required to be delivered by the Borrower to Lenders pursuant to
Section 5.1(a) and 5.1(b) shall be prepared in accordance with GAAP as in
effect at the time of such 

 42
 

preparation (and delivered together with the
reconciliation statements provided for in Section 5.1(d), if applicable).  Subject to the foregoing, calculations in
connection with the definitions, covenants and other provisions hereof shall
utilize accounting principles and policies in conformity with those used to
prepare the Historical Financial Statements. 
If any change in the accounting principles used in the preparation of
the most recent financial statements referred to in Section 5.1 is hereafter
required or permitted by the rules, regulations, pronouncements and opinions of
the Financial Accounting Standards Board or the American Institute of Certified
Public Accountants (or any successors thereto) and such change is adopted by
the Borrower with the agreement of the Borrower’s Accountants and results in a
change in any of the calculations required by Section 6 that would not have
resulted had such accounting change not occurred, the parties hereto agree to
enter into negotiations in order to amend such provisions so as to equitably reflect
such change such that the criteria for evaluating compliance with such
covenants by the Borrower shall be the same after such change as if such change
had not been made.

1.3          Interpretation,
etc.  Any of the
terms defined herein may, unless the context otherwise requires, be used in the
singular or the plural, depending on the reference.  References herein to any Section, Appendix,
Schedule or Exhibit shall be to a Section, an Appendix, a Schedule or an Exhibit,
as the case may be, hereof unless otherwise specifically provided.  The use herein of the word “include” or “including,”
when following any general statement, term or matter, shall not be construed to
limit such statement, term or matter to the specific items or matters set forth
immediately following such word or to similar items or matters, whether or not
no limiting language (such as “without limitation” or “but not limited to” or
words of similar import) is used with reference thereto, but rather shall be
deemed to refer to all other items or matters that fall within the broadest
possible scope of such general statement, term or matter.  Unless the prior written consent of the
Requisite Lenders is required hereunder for an amendment, restatement, supplement
or other modification to any such agreement and such consent is not obtained,
references in this Agreement to such agreement shall be to such agreement as so
amended, restated, supplemented or modified. 
References in this Agreement to any statute shall be to such statute as
amended or modified from time to time and to any successor legislation thereto,
in each case as in effect at the time any such reference is operative.  The terms “Lender,” “Issuing Bank,” “Administrative
Agent,” “Collateral Agent,” “Syndication Agent,” “Facility Agent” and “Agent”
include, without limitation, their respective successors.  Upon the appointment of any successor
Facility Agent pursuant to Section 9.7, references to Citibank in the
definitions of Base Rate, Dollar Equivalent and Eurodollar Rate shall be deemed
to refer to the financial institution then acting as such Facility Agent or one
of its Affiliates if it so designates.

1.4          Conversion
of Foreign Currencies.

(a)           Dollar
Equivalents.  The Administrative Agent
shall determine the Dollar Equivalent of any amount as required hereby, and a
determination thereof by the Administrative Agent shall be conclusive absent
manifest error.  The Administrative Agent
may, but shall not be obligated to, rely on any determination made by any
Credit Party in any document delivered to the Administrative Agent.  The Administrative Agent may determine or
redetermine the Dollar Equivalent of any amount on any date either in its own
reasonable discretion or upon the request of any Lender or Issuing Bank.

(b)           Rounding-Off. 
The Administrative Agent may set up appropriate rounding-off mechanisms
or otherwise round off amounts hereunder to the nearest higher or lower amount
in whole Dollar or cent to ensure amounts owing by any party hereunder or that
otherwise need to be calculated or converted hereunder are expressed in whole
Dollars or in whole cents, as may be necessary or appropriate.

 43

 

SECTION
2.                                      LOANS
AND LETTERS OF CREDIT

2.1                                   Revolving
Loans; Protective Advances.

(a)                                  Revolving
Commitments.  On the terms and
subject to the conditions contained in this Agreement, each Lender severally
agrees to make loans in Dollars (each a “Revolving
Loan”) to the Borrower from time to time on any Business Day during
the Revolving Commitment Period in an aggregate principal amount at any time
outstanding for all such loans by such Lender not to exceed such Lender’s
Revolving Commitment; provided, however, that at no time shall
any Lender be obligated to make a Revolving Loan in excess of such Lender’s Pro
Rata Share of the Excess Availability. 
Within the limits of the Revolving Commitment of each Lender, amounts of
Revolving Loans repaid may be reborrowed under this Section 2.1.

(b)                                 Borrowing
Mechanics for Revolving Loans.

(i)                             Each
Borrowing (other than any Borrowing of Swing Line Loans or Protective Advances)
shall be made on notice given by the Borrower to the Administrative Agent
(which may be given by electronic mail, including with electronic signature
thereto) not later than noon (New York time) (A) on the date of proposed
Borrowing, in the case of a Borrowing of Base Rate Loans, and (B) three Business
Days, in the case of a Borrowing of Eurodollar Rate Loans, prior to the date of
the proposed Borrowing.  Each such notice
shall be in substantially the form of Exhibit A-1 (the “Funding Notice”), specifying (1) the date
of such proposed Borrowing, (2) the aggregate amount of such proposed
Borrowing, (3) whether any portion of the proposed Borrowing will be of Base
Rate Loans or Eurodollar Rate Loans, (4) for each Eurodollar Rate Loan, the
initial Interest Period or Periods thereof and (5) the Excess Availability
(after giving effect to the proposed Borrowing).  The Revolving Loans shall be made as Base
Rate Loans unless, subject to Sections 2.17 and 2.18, the Funding Notice
specifies that all or a portion thereof shall be Eurodollar Rate Loans.  Notwithstanding anything to the contrary
contained in Section 2.2 (a), if any Funding Notice requests a Borrowing of
Base Rate Loans, the Administrative Agent may make a Swing Line Loan available
to the Borrower in an aggregate amount not to exceed such proposed Borrowing,
and the aggregate amount of the corresponding proposed Borrowing shall be
reduced accordingly by the principal amount of such Swing Line Loan.  Each Borrowing of Eurodollar Rate Loans shall
be in an aggregate amount of not less than $5,000,000 or an integral multiple
of $1,000,000 in excess thereof.  Except
as provided in Sections 2.2 and 2.3 and except for Protective Advances which
shall be made in the amounts required by Section 2.1(c), each Borrowing of Base
Rate Loans shall be in an aggregate amount of not less than $1,000,000 or an
integral multiple of $500,000 in excess thereof.

(ii)                          The
Administrative Agent shall give to each Lender prompt notice of the Administrative
Agent’s receipt of a Funding Notice and, if Eurodollar Rate Loans are properly
requested in such Funding Notice, the applicable interest rate determined
pursuant to Section 2.17(a).  Each Lender
shall, before 2:00 p.m. (New York time) on the date of the proposed Borrowing,
make available to the Administrative Agent at its Principal Office, in
immediately available funds, such Lender’s Pro Rata Share of such proposed
Borrowing.  Upon fulfillment (or due
waiver in accordance with Section 10.5) (i) on the Closing Date, of the
applicable conditions set forth in Section 3.1 and (ii) at any time (including
the Closing Date), of the applicable conditions set forth in Section 3.2, and
after the Administrative Agent’s receipt of such funds, the Administrative
Agent shall make such funds available to the Borrower.

(iii)                       Unless the
Administrative Agent shall have received notice from a Lender prior to the date
of any proposed Borrowing that such Lender will not make available to the
Administrative Agent such Lender’s Pro Rata Share of such Borrowing (or any
portion thereof), the Administrative Agent may assume that such Lender has made
such Pro Rata Share available to the Administrative Agent on the date of such
Borrowing in accordance with this Section 2.1(b) and the Administrative Agent
may, in reliance 

 44
 

upon such assumption, make available to the
Borrower on such date a corresponding amount. 
If and to the extent that such Lender shall not have so made such Pro
Rata Share available to the Administrative Agent, such Lender and the Borrower
severally agree to repay to the Administrative Agent forthwith on demand such
corresponding amount together with interest thereon, for each day from the date
such amount is made available to the Borrower until the date such amount is
repaid to the Administrative Agent, at (i) in the case of the Borrower, the
interest rate applicable at the time to the Loans comprising such Borrowing and
(ii) in the case of such Lender, the Federal Funds Effective Rate for the first
Business Day and thereafter at the interest rate applicable at the time to the
Loans comprising such Borrowing.  If such
Lender shall repay to the Administrative Agent such corresponding amount, such
corresponding amount so repaid shall constitute such Lender’s Loan as part of
such Borrowing for purposes of this Agreement. 
If the Borrower shall repay to the Administrative Agent such corresponding
amount, such payment shall not relieve such Lender of any obligation it may
have hereunder to the Borrower.

(iv)                      The failure
of any Defaulting Lender to make on the date specified any Loan or any payment
required by it, including any payment in respect of its participation in Swing
Line Loans and Letter of Credit Obligations, shall not relieve any other Lender
of its obligations to make such Loan or payment on such date but no such other
Lender shall be responsible for the failure of any Defaulting Lender to make a
Loan or payment required under this Agreement.

(c)                                  Protective
Advances.  Subject to the limitations
set forth below (and notwithstanding anything to the contrary in Section 2.1(b)
or in Section 3), the Administrative Agent is authorized by the Borrower and
the Lenders, from time to time in the Administrative Agent’s sole discretion
(but shall have absolutely no obligation), to make Revolving Loans that are
Base Rate Loans on behalf of all Lenders to the Borrower, at any time that any
condition precedent set forth in Section 3.2 has not been satisfied or waived,
which the Administrative Agent, in its sole discretion, deems necessary or
desirable (x) to preserve or protect the Collateral, or any portion thereof, or
(y) to enhance the likelihood of, or maximize the amount of, repayment of the
Loans and other Obligations or to pay any other amount chargeable to the
Borrower pursuant to the terms of this Agreement including Secured Party
Expenses (each such loan, a “Protective
Advance”).  Any Protective Advance
may be made in a principal amount that would cause the aggregate amount of the
Lenders’ Revolving Credit Exposures to exceed the Borrowing Base; provided
that no Protective Advance may be made to the extent that, after giving effect
to such Protective Advance (together with the outstanding principal amount of
any outstanding Protective Advances) the aggregate principal amount of all
Protective Advances outstanding hereunder would exceed 5% of the Borrowing Base
as determined on the date of such proposed Protective Advance.  Each Protective Advance shall be secured by
the Liens in favor of the Collateral Agent on behalf of the Secured Parties in
and to the Collateral and shall constitute Obligations hereunder.  The Administrative Agent’s authorization to
make Protective Advances may be revoked at any time by the Requisite
Lenders.  Any such revocation must be in
writing and will become effective prospectively upon the Administrative Agent’s
receipt thereof.  The making of a
Protective Advance on any one occasion shall not obligate the Administrative
Agent to make any Protective Advance on any other occasion and under no
circumstance shall the Borrower have the right to require that a Protective
Advance be made.  At any time that the
conditions precedent set forth in Section 3.2 have been satisfied or waived,
the Administrative Agent may request the Lenders to make a Revolving Loan to
repay a Protective Advance.  At any other
time, the Administrative Agent may require the Lenders to fund their risk
participations described in Section 2.1(d).

(d)                                 Participations in
Protective Advances.  Upon the making
of a Protective Advance by the Administrative Agent (whether before or after
the occurrence of a Default or an Event of Default), each Lender shall be
deemed, without further action by any party hereto, unconditionally and
irrevocably to have purchased from the Administrative Agent, without recourse
or warranty, an undivided interest and participation in such Protective Advance
in proportion to its Pro Rata Share. 
From and after the date, if any, on which any Lender is required to fund
its participation in any Protective Advance purchased hereunder, 

 45
 

the Administrative Agent shall promptly distribute to such Lender, such
Lender’s Pro Rata Share of all payments of principal and interest and all
proceeds of Collateral received by the Administrative Agent in respect of such
Protective Advance.

2.2                                   Swing
Line Loans.

(a)                                  On
the terms and subject to the conditions contained in this Agreement, the Swing
Line Lender agrees to make, in Dollars, loans (each a “Swing Line Loan”) otherwise available to
the Borrower under the Revolving Credit Facility from time to time on any
Business Day during the Revolving Commitment Period in an aggregate principal
amount at any time outstanding (together with the aggregate outstanding
principal amount of any other Loan made by the Swing Line Lender hereunder in
its capacity as a Lender or the Swing Line Lender) not to exceed the Swing Line
Lender’s Pro Rata Share of the lesser of (x) the Excess Availability and (y)
the Swing Line Sublimit.  Each Swing Line
Loan shall be a Base Rate Loan and must be repaid in full within seven days
after its making or, if sooner, upon any Borrowing hereunder and shall in any
event mature no later than the Revolving Commitment Termination Date.  Within the limits set forth in the first
sentence of this clause (a), amounts of Swing Line Loans repaid may be
reborrowed under this clause (a).

(b)                                 In
order to request a Swing Line Loan, the Borrower shall telecopy (or forward by
electronic mail, including with an electronic signature thereto, or similar
means) to the Administrative Agent a duly completed request in substantially
the form of Exhibit A-4 (a “Swing Line
Request”), setting forth the requested (i) amount, which shall be a
minimum of $1,000,000 (and any amount in excess of $500,000 shall be an
integral multiple of $1,000,000 (except during a Voluntary Cash Management Period;
during which such minimum denominations shall not apply) and (ii) date, which
shall be a Business Day, of such Swing Line Loan), to be received by the
Administrative Agent not later than 1:00 p.m. (New York time) on the day of the
proposed Borrowing.  The Administrative
Agent shall promptly notify the Swing Line Lender of the details of the
requested Swing Line Loan.  Subject to
the terms of this Agreement, the Swing Line Lender may make a Swing Line Loan
available to the Administrative Agent and, in turn, the Administrative Agent
shall make such amounts available to the Borrower on the date of the relevant
Swing Line Request. The Swing Line Lender shall not make any Swing Line Loan in
the period commencing on the first Business Day after it receives written
notice from the Administrative Agent or any Lender that one or more of the
conditions precedent contained in Section 3.2 shall not on such date be
satisfied, and ending when such conditions are satisfied.  The Swing Line Lender shall not otherwise be
required to determine that, or take notice whether, the conditions precedent
set forth in Section 3.2 have been satisfied in connection with the making of
any Swing Line Loan.

(c)                                  The
Swing Line Lender shall notify the Administrative Agent in writing (which
writing may be a telecopy or electronic mail) weekly, by no later than 10:00
a.m. (New York time) on the first Business Day of each week, of the aggregate
principal amount of its Swing Line Loans then outstanding.

(d)                                 The
Swing Line Lender may demand at any time that each Lender pay to the Administrative
Agent, for the account of the Swing Line Lender, in the manner provided in
clause (e) below, such Lender’s Pro Rata Share of all or a portion of the
outstanding Swing Line Loans, which demand shall be made through the
Administrative Agent, shall be in writing and shall specify the outstanding
principal amount of Swing Line Loans demanded to be paid.

(e)                                  The
Administrative Agent shall forward each notice referred to in clause (c) above
and each demand referred to in clause (d) above to each Lender on the day such
notice or such demand is received by the Administrative Agent (except that any
such notice or demand received by the Administrative Agent after 2:00 p.m. (New
York time) on any Business Day or any such demand received on a day that is not
a Business Day shall not be required to be forwarded to the Lenders by the
Administrative 

 46
 

Agent until the next succeeding Business
Day), together with a statement prepared by the Administrative Agent specifying
the amount of each Lender’s Pro Rata Share of the aggregate principal amount of
the Swing Line Loans stated to be outstanding in such notice or demanded to be
paid pursuant to such demand, and, notwithstanding whether or not the
conditions precedent set forth in Sections 3.2 and 2.1 shall have been
satisfied (which conditions precedent the Lenders hereby irrevocably waive),
each Lender shall, before 11:00 a.m. (New York time) on the Business Day next
succeeding the date of such Lender’s receipt of such notice or demand, make
available to the Administrative Agent, in immediately available funds, for the
account of the Swing Line Lender, the amount specified in such statement.  Upon such payment by a Lender, such Lender
shall, except as provided in clause (f) below, be deemed to have made a
Revolving Loan to the Borrower.  The
Administrative Agent shall use such funds to repay the Swing Line Loans to the
Swing Line Lender.  To the extent that
any Lender fails to make such payment available to the Administrative Agent for
the account of the Swing Line Lender, the Borrower shall repay such Swing Line
Loan on demand.

(f)                                    Upon
the occurrence of a Default or at any other time upon the request of the
Administrative Agent or the Swing Line Lender, each Lender shall acquire,
without recourse or warranty, an undivided participation in each Swing Line
Loan otherwise required to be repaid by such Lender pursuant to clause (e)
above, which participation shall be in a principal amount equal to such Lender’s
Pro Rata Share of such Swing Line Loan, by paying to the Swing Line Lender on
the date on which such Lender would otherwise have been required to make a
payment in respect of such Swing Line Loan pursuant to clause (e) above, in
immediately available funds, an amount equal to such Lender’s Pro Rata Share of
such Swing Line Loan.  If all or part of
such amount is not in fact made available by such Lender to the Swing Line
Lender on such date, the Swing Line Lender shall be entitled to recover any
such unpaid amount on demand from such Lender together with interest accrued
from such date at the Federal Funds Effective Rate for the first Business Day
after such payment was due and thereafter at the rate of interest then applicable
to Base Rate Loans.

(g)                                 From
and after the date on which any Lender (i) is deemed to have made a Revolving
Loan pursuant to clause (e) above with respect to any Swing Line Loan or (ii)
purchases an undivided participation interest in a Swing Line Loan pursuant to
clause (f) above, the Swing Line Lender shall promptly distribute to such
Lender such Lender’s Pro Rata Share of all payments of principal of and interest
received by the Swing Line Lender on account of such Swing Line Loan other than
those received from a Lender pursuant to clause (e) or (f) above.

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

(a)                                  On
the terms and subject to the conditions contained in this Agreement, each Issuing
Bank agrees to issue at the request of the Borrower and for the account of the
Borrower or on behalf of any Credit Party one or more Letters of Credit
denominated in any Approved Currency (provided that the face amount of all
Letters of Credit denominated in a currency other than Dollars shall not exceed
$10.0 million at any time outstanding) from time to time on any Business Day
during the period commencing on the Closing Date and ending on the third day
prior to the Revolving Commitment Termination Date; provided, however,
that no Issuing Bank shall be under any obligation to issue (and, upon the
occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and
(vi)(A) below, shall not issue) any Letter of Credit upon the occurrence of any
of the following:

(i)                                     any
order, judgment or decree of any Governmental Authority or arbitrator shall
purport by its terms to enjoin or restrain such Issuing Bank from issuing such
Letter of Credit or any requirement of law applicable to such Issuing Bank or
any request or directive (whether or not having the force of law) from any
Governmental Authority with jurisdiction over such Issuing Bank shall prohibit,
or request that such Issuing Bank refrain from, the issuance of letters of 

 47
 

credit generally or such Letter of Credit in particular or shall impose
upon such Issuing Bank with respect to such Letter of Credit any restriction or
reserve or capital requirement (for which such Issuing Bank is not otherwise
compensated) not in effect on the date of this Agreement or result in any
unreimbursed loss, cost or expense that was not applicable, in effect or known
to such Issuing Bank as of the date of this Agreement and that such Issuing
Bank in good faith deems material to it;

(ii)                                  such
Issuing Bank shall have received any written notice of the type described in
clause (d) below;

(iii)                               after
giving effect to the issuance of such Letter of Credit, the aggregate Revolving
Credit Outstandings would exceed the Maximum Credit at such time;

(iv)                              after
giving effect to the issuance of such Letter of Credit, the Letter of Credit
Usage exceeds the Letter of Credit Sublimit;

(v)                                 such
Letter of Credit is requested to be denominated in any currency other than an
Approved Currency; or

(vi)                              (A)
any fees due in connection with a requested issuance have not been paid, (B)
such Letter of Credit is requested to be issued in a form that is not
acceptable to such Issuing Bank or (C) the Issuing Bank for such Letter of
Credit shall not have received, in form and substance reasonably acceptable to
it and, if applicable, duly executed by such Borrower, applications, agreements
and other documentation (collectively, a “Letter
of Credit Reimbursement Agreement”) such Issuing Bank generally
employs in the ordinary course of its business for the issuance of letters of
credit of the type of such Letter of Credit.

None of the Lenders (other than the Issuing Banks in
their capacity as such) shall have any obligation to issue any Letter of
Credit.

(b)                                 In
no event shall the expiration date of any Letter of Credit (i) be more than one
year after the date of issuance thereof without the consent of the Issuing Bank
thereof or (ii) be less than five days prior to the Revolving Commitment Termination
Date; provided, however, that any Letter of Credit with a term
less than or equal to one year may provide for the renewal thereof for
additional periods less than or equal to one year, as long as, (x) on or before
the expiration of each such term and each such period, the Borrower and the
Issuing Bank of such Letter of Credit shall have the option to prevent such
renewal and (y) the Borrower shall not permit any such renewal to extend the
expiration date of any Letter of Credit beyond the date set forth in clause
(ii) above.

(c)                                  In
connection with the issuance of each Letter of Credit, the Borrower shall give
the relevant Issuing Bank and the Administrative Agent at least two Business
Days’ prior written notice, in substantially the form of Exhibit A-3 (or
in such other written or electronic form as is acceptable to the applicable
Issuing Bank) (an “Issuance Notice”),
of the requested issuance of such Letter of Credit.  Such notice shall be irrevocable and shall
specify the Issuing Bank of such Letter of Credit, the face amount of the
Letter of Credit requested (which shall not be less than $50,000 or the foreign
currency equivalent as calculated pursuant to clause (l) below), the date of
issuance of such requested Letter of Credit, the date on which such Letter of
Credit is to expire (which date shall be a Business Day) and, in the case of an
issuance, the Person for whose benefit the requested Letter of Credit is to be
issued.  Such notice, to be effective,
must be received by the relevant Issuing Bank and the Administrative Agent not
later than 11:00 a.m. (New York time) on the second Business Day prior to the requested
issuance of such Letter of Credit.

 48
 

(d)                                 Subject
to the satisfaction of the conditions set forth in this Section 2.3, the
relevant Issuing Bank shall, on the requested date, issue a Letter of Credit on
behalf of the applicable Borrower in accordance with such Issuing Bank’s usual
and customary business practices.  No
Issuing Bank shall issue any Letter of Credit in the period commencing on the
first Business Day after it receives written notice from any Lender that one or
more of the conditions precedent contained in Section 3.2 or clause (a) above
(other than those conditions set forth in clauses (a)(i), (a)(vi)(B) and (C)
above and, to the extent such clause relates to fees owing to the Issuing Bank
of such Letter of Credit and its Affiliates, clause (a)(vi)(A) above) are not
on such date satisfied or duly waived and ending when such conditions are satisfied
or duly waived.  No Issuing Bank shall
otherwise be required to determine that, or take notice whether, the conditions
precedent set forth in Section 3.2 have been satisfied in connection with the
issuance of any Letter of Credit.

(e)                                  Each
Borrower agrees that, if requested by the Issuing Bank of any Letter of Credit,
it shall execute a Letter of Credit Reimbursement Agreement in respect to any
Letter of Credit issued hereunder.  In
the event of any conflict between the terms of any Letter of Credit
Reimbursement Agreement and this Agreement, the terms of this Agreement shall
govern.

(f)                                    Each
Issuing Bank shall comply with the following:

(i)                                     give
the Administrative Agent written notice (or telephonic notice confirmed
promptly thereafter in writing), which writing may be a telecopy or electronic
mail, of the issuance of any Letter of Credit issued by it, of all drawings
under any Letter of Credit issued by it and of the payment (or the failure to
pay when due) by the Borrower of any Reimbursement Obligation when due (which
notice the Administrative Agent shall promptly transmit by telecopy, electronic
mail or similar transmission to each Lender);

(ii)                                  upon
the request of any Lender, furnish to such Lender copies of any Letter of
Credit Reimbursement Agreement to which such Issuing Bank is a party and such
other documentation as may reasonably be requested by such Lender; and

(iii)                               no
later than 10 Business Days following the last day of each calendar month,
provide to the Administrative Agent (and the Administrative Agent shall provide
a copy to each Lender requesting the same) and the Borrower separate schedules
for Documentary Letters of Credit and Standby Letters of Credit issued by it,
in form and substance reasonably satisfactory to the Administrative Agent,
setting forth the aggregate Letter of Credit Obligations, in each case
outstanding at the end of each month, and any information requested by the
Borrower, or the Administrative Agent relating thereto.

(g)                                 Immediately
upon the issuance by an Issuing Bank of a Letter of Credit in accordance with
the terms and conditions of this Agreement, such Issuing Bank shall be deemed
to have sold and transferred to each Lender, and each Lender shall be deemed
irrevocably and unconditionally to have purchased and received from such
Issuing Bank, without recourse or warranty, an undivided interest and participation,
to the extent of such Lender’s Pro Rata Share, in such Letter of Credit and the
obligations of the Borrower with respect thereto (including all Letter of
Credit Obligations with respect thereto) and any security therefor and guaranty
pertaining thereto.

(h)                                 The
Borrower agrees to pay to the Issuing Bank of any Letter of Credit the amount
of all Reimbursement Obligations owing to such Issuing Bank under any Letter of
Credit issued for its account no later than the date that is the next
succeeding Business Day after the Borrower receives written notice from such
Issuing Bank that payment has been made under such Letter of Credit (the “Reimbursement Date”), irrespective of any
claim, set-off, defense or other right that the Borrower may have at any time 

 49
 

against such Issuing Bank or any other
Person.  In the event that any Issuing
Bank makes any payment under any Letter of Credit and the Borrower shall not
have repaid such amount to such Issuing Bank pursuant to this clause (h) or any
such payment by the Borrower is rescinded or set aside for any reason, such
Reimbursement Obligation shall be payable on demand with interest thereon
computed (i) from the date on which such Reimbursement Obligation arose to the
Reimbursement Date, at the rate of interest applicable during such period to
Revolving Loans that are Base Rate Loans and (ii) from the Reimbursement Date
until the date of repayment in full, at the rate of interest applicable during
such period to past due Revolving Loans that are Base Rate Loans, and such
Issuing Bank shall promptly notify the Administrative Agent, which shall
promptly notify each Lender of such failure, and each Lender shall promptly and
unconditionally pay to the Administrative Agent for the account of such Issuing
Bank the amount of such Lender’s Pro Rata Share of such payment in immediately
available Dollars (if applicable, as converted from foreign currency equivalent
pursuant to clause (l) below).  If the
Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York
time) on any Business Day, such Lender shall make available to the Administrative
Agent for the account of such Issuing Bank its Pro Rata Share of the amount of
such payment on such Business Day in immediately available funds.  Upon such payment by a Lender, such Lender
shall, except during the continuance of a Default or Event of Default and
notwithstanding whether or not the conditions precedent set forth in Section
3.2 shall have been satisfied (which conditions precedent the Lenders hereby
irrevocably waive), be deemed to have made a Revolving Loan to the Borrower in
the principal amount of such payment. 
Whenever any Issuing Bank receives from the Borrower a payment of a Reimbursement
Obligation as to which the Administrative Agent has received for the account of
such Issuing Bank any payment from a Lender pursuant to this clause (h), such
Issuing Bank shall pay over to the Administrative Agent any amount received in
excess of such Reimbursement Obligation and, upon receipt of such amount, the Administrative
Agent shall promptly pay over to each Lender, in immediately available funds,
an amount equal to such Lender’s Pro Rata Share of the amount of such payment adjusted,
if necessary, to reflect the respective amounts the Lenders have paid in
respect of such Reimbursement Obligation.

(i)                                     If
and to the extent such Lender shall not have so made its Pro Rata Share of the
amount of the payment required by clause (h) above available to the
Administrative Agent for the account of such Issuing Bank, such Lender agrees
to pay to the Administrative Agent for the account of such Issuing Bank
forthwith on demand any such unpaid amount together with interest thereon, for
the first Business Day after payment was first due at the Federal Funds
Effective Rate and, thereafter, until such amount is repaid to the
Administrative Agent for the account of such Issuing Bank, at a rate per annum
equal to the rate applicable to Base Rate Loans.

(j)                                     The
Borrower’s obligation to pay each Reimbursement Obligation when due and the obligations
of the Lenders to make payments to the Administrative Agent for the account of
the Issuing Banks with respect to Letters of Credit shall be absolute,
unconditional and irrevocable and shall be performed strictly in accordance
with the terms of this Agreement, under any and all circumstances whatsoever,
including the occurrence of any Default or Event of Default, and irrespective
of any of the following (without prejudice to Borrower’s other rights
hereunder):

(i)                                     any
lack of validity or enforceability of any Letter of Credit or any Credit Document,
or any term or provision therein;

(ii)                                  any
amendment or waiver of or any consent to departure from all or any of the
provisions of any Letter of Credit or any Credit Document;

(iii)                               the
existence of any claim, set off, defense or other right that the Borrower, any
other party guaranteeing, or otherwise obligated with, the Borrower, any
Subsidiary or other Affiliate thereof or any other Person may at any time have
against the beneficiary under any Letter 

 50
 

of Credit, any Issuing Bank, the Administrative Agent or any Lender or
any other Person, whether in connection with this Agreement, any other Credit
Document or any other related or unrelated agreement or transaction;

(iv)                              any
draft or other document presented under a Letter of Credit proving to be
forged, fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect;

(v)                                 payment
by the Issuing Bank under a Letter of Credit against presentation of a draft or
other document that does not comply with the terms of such Letter of Credit;
and

(vi)                              any
other act or omission to act or delay of any kind of the Issuing Bank, the
Lenders, the Administrative Agent or any other Person or any other event or
circumstance whatsoever, whether or not similar to any of the foregoing, that
might, but for the provisions of this Section 2.3, constitute a legal or
equitable discharge of the Borrower’s obligations hereunder.

Any action taken or omitted to be taken by the
relevant Issuing Bank under or in connection with any Letter of Credit, if
taken or omitted in the absence of gross negligence or willful misconduct,
shall not result in any liability of such Issuing Bank to the Borrower or any
Lender.  In determining whether drafts
and other documents presented under a Letter of Credit comply with the terms
thereof, the Issuing Bank may accept documents that appear on their face to be
in order, without responsibility for further investigation, regardless of any
notice or information to the contrary and, in making any payment under any
Letter of Credit, the Issuing Bank may rely exclusively on the documents
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 insufficient in any respect, if
such document on its face appears to be in order, and whether or not any other
statement or any other document 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 any noncompliance in any immaterial
respect of the documents 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 the Issuing Bank.

(k)                                  Schedule
2.3(k) contains a schedule of certain letters of credit issued prior to the
Closing Date (the “Existing Letters of Credit”)
for the account of the applicable Borrower by the issuers set forth on such Schedule
2.3(k).  On the Closing Date, (i)
such letters of credit, to the extent outstanding, shall be automatically and
without further action by the parties thereto converted to Letters of Credit issued
pursuant to this Section 2.3 for the account of the applicable Borrower and
subject to the provisions hereof, and for this purpose the fees specified in
Section 2.10 shall be payable (in substitution for any fees set forth in the
applicable letter of credit reimbursement agreements or applications relating
to such letters of credit) as if such letters of credit had been issued on the
Closing Date, (ii) the Issuing Banks of such Letters of Credit shall be deemed
to be “Issuing Banks” hereunder solely for the purpose of maintaining such
letters of credit, for purposes of Section 2.19 relating to the obligation to
provide the appropriate forms, certificates and statements to the Borrower and
the Administrative Agent and any updates required by Section 2.19 and for
purposes of Section 2.6 relating to the entries to be made in the Register,
(iii) the Dollar Equivalent of the face amount of such letters of credit shall
be included in the calculation of Letter of Credit Obligations and (iv) all
liabilities of the Borrower with respect to such letters of credit shall constitute
Obligations.  No letter of credit
converted in accordance with this clause (k) shall be amended, extended or
renewed without the prior written consent of the Administrative Agent.

 51
 

(l)                                     With
respect to any Letter of Credit denominated in a currency other than Dollars,
notwithstanding anything herein to the contrary, the related Letter of Credit
Undrawn Amounts, the related Reimbursement Obligations, any reimbursement obligation
of any Lender pursuant to clause (i) above, any other obligation owed by or to
any Lender, any fee owed pursuant to Section 2.10(a)(ii) and any Fronting Fee
shall, in each case, be calculated and due solely in Dollars.  The exchange rate for conversion into Dollars
utilized shall be the Dollar equivalent of the applicable foreign currency as
reasonably determined by such Issuing Bank and the Administrative Agent based
on the rate at which such Issuing Bank could convert or has converted any such
foreign currency into Dollars taking into account all transaction costs.  Any such exchange rate shall be updated at
intervals reasonably determined by such Issuing Bank and the Administrative
Agent.

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

2.5                                   Use
of Proceeds.  The proceeds of the
Revolving Loans, Swing Line Loans and Letters of Credit made after the Closing
Date shall be applied by the Borrower for working
capital and general corporate purposes of the Borrower and its Subsidiaries,
including Permitted Acquisitions.  No
portion of the proceeds of any Credit Extension shall be used in any manner
that causes or might cause such Credit Extension or the application of such
proceeds to violate Regulation T, Regulation U or Regulation X
of the Board of Governors or any other regulation thereof or to violate the Exchange
Act.

2.6                                   Repayment
of Loans; Evidence of Debt; Register; Lenders’ Books and Records; Notes.

(a)                                  Repayment of Loans.  The Borrower shall repay to the
Administrative Agent for the ratable account of the Lenders on the Revolving
Commitment Termination Date the aggregate principal amount of all of its
Revolving Loans outstanding on such date. 
The Borrower shall repay each Swing Line Loan on the Revolving
Commitment Termination Date.  The Borrower
shall repay to the Administrative Agent the then unpaid amount of each
Protective Advance on the Revolving Commitment Termination Date.

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

(c)                                  Register.  The Administrative Agent (or its agent or
sub-agent appointed by it) shall maintain at its Principal Office a register
for the recordation of the names and addresses of the Lenders, the Revolving
Commitments and Loans of each Lender from time to time and any Notes issued by
the Borrower pursuant to Section 2.6(d) evidencing such Loans (the “Register”). 
The Register, as in effect at the close of business on the preceding
Business Day, shall be available for inspection by the Borrower or any Lender
(solely with respect to the Obligations owing to such Lender) at any reasonable
time and from time to time upon reasonable prior notice.  The Administrative Agent shall record, or
shall cause to be 

 52
 

recorded, in the Register the Revolving
Commitments and the Loans in accordance with the provisions of Section 10.6,
and each repayment or prepayment in respect of the principal amount of the
Loans, and any such recordation shall be conclusive and binding on the Borrower
and each Lender, absent manifest error; provided, failure to make any
such recordation, or any error in such recordation, shall not affect any Lender’s
Revolving Commitments or the Borrower’s Obligations in respect of any
Loan.  The Borrower hereby designates
CNAI to serve as the Borrower’s agent solely for purposes of maintaining the
Register as provided in this Section 2.6, and the Borrower hereby agrees that,
to the extent CNAI serves in such capacity, CNAI and its officers, directors,
employees, agents, sub-agents and affiliates shall constitute “Indemnitees.”

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

2.7                                   Interest
on Loans.

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

(i)                                     in
the case of Revolving Loans:

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

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

(ii)                                  in
the case of Swing Line Loans, at the Base Rate plus the Applicable Margin.

(b)                                 The
basis for determining the rate of interest with respect to any Loan (except a
Swing Line Loan which can be made and maintained as Base Rate Loans only), and
the Interest Period with respect to any Eurodollar Rate Loan, shall be selected
by the Borrower and notified to the Administrative Agent and Lenders pursuant
to the applicable Funding Notice or Conversion/Continuation Notice, as the case
may be.  If on any day a Loan is
outstanding with respect to which a Funding Notice or Conversion/Continuation
Notice has not been delivered to the Administrative Agent in accordance with
the terms hereof specifying the applicable basis for determining the rate of
interest, then such Loan will automatically convert into a Eurodollar Rate Loan
with an Interest Period of one month beginning on such date.

(c)                                  In
connection with Eurodollar Rate Loans, there shall be no more than five (5)
Interest Periods outstanding at any time. 
In the event the Borrower fails to specify between a Base Rate Loan or a
Eurodollar Rate Loan in the applicable Funding Notice or Conversion/Continuation
Notice, such Loan (if outstanding as a Eurodollar Rate Loan) will be
automatically continued as a Eurodollar Rate Loan with an Interest Period of
one month beginning on the last day of the then-current Interest Period for
such Loan or (if outstanding as a Base Rate Loan will be automatically
converted into (or if not then outstanding will be made as) a Eurodollar Rate
Loan with an Interest Period of one month. 
In the event the Borrower fails to specify an Interest Period for any
Eurodollar Rate Loan in the applicable Funding Notice or Conversion/Continuation
Notice, the Borrower shall be deemed to have selected an Interest Period of one
month.  As soon as practicable after
10:00 a.m. (New York City time) on each Interest Payment Date, the Administrative

 53
 

Agent shall determine (which determination
shall, absent manifest error, be final, conclusive and binding upon all
parties) the interest rate that shall apply to the Eurodollar Rate Loans for
which an interest rate is then being determined for the applicable Interest
Period and shall promptly give notice thereof (in writing or by telephone
confirmed in writing) to the Borrower and each Lender.

(d)                                 Interest
payable pursuant to Section 2.7(a) shall be computed (i) in the case of Base
Rate Loans on the basis of a 365-day or 366-day year, as the case
may be, and (ii) in the case of Eurodollar Rate Loans and Base Rate Loans where
the Base Rate is determined pursuant to clause (ii) of the definition of “Base
Rate,” on the basis of a 360-day year, in each case for the actual number
of days elapsed in the period during which it accrues.  In computing interest on any Loan, the date
of the making of such Loan or the first day of an Interest Period applicable to
such Loan or, with respect to a Base Rate Loan being converted from a Eurodollar
Rate Loan, the date of conversion of such Eurodollar Rate Loan to such Base
Rate Loan, as the case may be, shall be included, and the date of payment of
such Loan or the expiration date of an Interest Period applicable to such Loan
or, with respect to a Base Rate Loan being converted to a Eurodollar Rate Loan,
the date of conversion of such Base Rate Loan to such Eurodollar Rate Loan, as
the case may be, shall be excluded; provided, if a Loan is repaid on the
same day on which it is made, one day’s interest shall be paid on that Loan.

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

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

(g)                                 Interest
payable pursuant to Section 2.7(f) shall be computed on the basis of a 360-day
year for the actual number of days elapsed in the period during which it
accrues, and shall be payable on demand or, if no demand is made, on the date
on which the related drawing under a Letter of Credit is reimbursed in
full.  Promptly upon receipt by any
Issuing Bank of any payment of interest pursuant to Section 2.7(f), such
Issuing Bank shall distribute to each Lender, out of the interest received by
such Issuing Bank in respect of the period from the date such drawing is
honored to but excluding the date on which such Issuing Bank is reimbursed for
the amount of such drawing (including any such reimbursement out of the
proceeds of any Revolving Loans), the amount that such Lender would have been
entitled to receive in respect of the letter of credit fee that would have been
payable in respect of such Letter of Credit for such period if no drawing had
been honored under such Letter of Credit. 
In the event any Issuing Bank shall have been reimbursed by Lenders for
all or any portion of such honored drawing, such Issuing Bank shall distribute
to each Lender which has paid all amounts payable by it under Section 2.3(e)
with respect to such honored drawing such Lender’s Pro Rata Share of any
interest received by Issuing Bank in respect of that portion of such honored
drawing so reimbursed by Lenders for the period from the date on which Issuing
Bank was so reimbursed by Lenders to but excluding the date on which such portion
of such honored drawing is reimbursed by the Borrower.

 54
 

(h)                                 The Borrower hereby
authorizes the Administrative Agent, from time to time, without prior notice to
the Borrower, to charge such interest and fees, all Secured Party Expenses (as
and when incurred), the charges, commissions, fees, the fees and costs provided
for in Section 2.10 (as and when accrued or incurred), and all other payments
as and when due and payable under any Credit Document to the Borrower, which
amounts thereafter shall constitute Loans hereunder and shall accrue interest
at the rate then applicable to Advances hereunder.  Any interest not paid when due shall be
compounded and shall thereafter constitute Loans hereunder and shall accrue
interest at the rate then applicable to Loans that are Base Rate Loans hereunder.

2.8                                   Conversion/Continuation.

(a)                                  Subject
to Section 2.17 and so long as no Default or Event of Default shall have
occurred and then be continuing, the Borrower shall have the option:

(i)                                     to convert at any
time all or any part of any Revolving Loan equal to $5,000,000 and integral
multiples of $1,000,000 in excess of that amount from one Type of Loan to
another Type of Loan; provided, a Eurodollar Rate Loan may only be
converted on the expiration of the Interest Period applicable to such
Eurodollar Rate Loan unless the Borrower shall pay all amounts due under
Section 2.17 in connection with any such conversion; or

(ii)                                  upon
the expiration of any Interest Period applicable to any Eurodollar Rate Loan,
to continue all or any portion of such Loan equal to $5,000,000 and integral
multiples of $1,000,000 in excess of that amount as a Eurodollar Rate Loan.

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

(c)                                  Notwithstanding
anything to the contrary in the foregoing, no conversion in whole or in part to
a Eurodollar Rate Loan shall be permitted at any time at which (i) a Default or
Event of Default shall have occurred and be continuing or (ii) the continuation
of, or conversion into, a Eurodollar Rate Loan would violate any provision of
Sections 2.17 or 2.18.  Protective
Advances may not be converted to Eurodollar Rate Loans under any circumstances.

2.9                                   Default
Interest.  Upon the occurrence and
during the continuance of an Event of Default, the principal amount of all
Loans outstanding and, to the extent permitted by applicable law, any interest
payments on the Loans or any fees or other amounts owed hereunder, shall
thereafter bear interest (including post-petition interest in any
proceeding under the Bankruptcy Code or other applicable bankruptcy laws)
payable on demand at a rate that is 2% per annum in excess of the interest rate
otherwise payable hereunder with respect to the applicable Loans (or, in the
case of any such fees and other amounts, at a rate which is 2% per annum in
excess of the interest rate otherwise payable hereunder for Base Rate Loans); provided,
in the case of Eurodollar Rate Loans, upon the expiration of the Interest Period
in effect at the time any such increase in interest rate is effective, such
Eurodollar Rate Loans shall thereupon become Base Rate Loans and shall
thereafter bear interest payable upon demand at a rate which is 2% per annum in
excess of the interest rate otherwise payable hereunder for Base Rate
Loans.  Payment or acceptance of the
increased rates of interest provided for in this Section 2.9 is not a permitted
alternative 

 55
 

to timely payment and shall not constitute a waiver of any Event of
Default or otherwise prejudice or limit any rights or remedies of any Agent or
any Lender.

2.10                            Fees.

(a)                                  The
Borrower agrees to pay to each Lender:

(i)                                     an
unused commitment fee in an amount equal to (1) the average of the actual daily
difference between (a) the Revolving Commitment of such Lender and (b) the aggregate
principal amount of all outstanding Revolving Loans owing to such Lender, times
(2) the Applicable Revolving Commitment Fee Percentage then in effect; provided,
that for purposes of calculating the commitment fee pursuant to this clause
(i), (A) Swing Line Loans and Protective Advances shall not be deemed to be a
utilization of the Revolving Commitments and (B) in the case of the Lender that
is also the Swing Line Lender, the unused commitment fee otherwise payable to
such Lender pursuant to this clause (i) shall be reduced by an amount equal to
the product of (x) the then outstanding Swing Line Loans made by it and (y) the
Applicable Revolving Commitment Fee Percentage then in effect; and

(ii)                                  letter
of credit fees equal to such Lender’s Pro Rata Share of the product of
(1) the Applicable Margin for Revolving Loans that are Eurodollar Rate
Loans, less the Fronting Fee (as defined below), times (2) the average
aggregate daily maximum amount available to be drawn under all such Letters of
Credit (regardless of whether any conditions for drawing could then be met and
determined as of the close of business on any date of determination).

All fees referred to in this Section 2.10(a) shall be
paid to the Administrative Agent at its Principal Office and upon receipt, the
Administrative Agent shall promptly distribute to each Lender the amount of
such fees owing to it.

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

(i)                                     a
fronting fee equal to 0.125% per annum (the “Fronting
Fee”), times the average aggregate daily maximum amount available to
be drawn under all Letters of Credit issued by such Issuing Bank (determined as
of the close of business on any date of determination); and

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

(c)                                  All
fees referred to in:

(i)                                     Section
2.10(a)(i) shall be calculated on the basis of a 360-day year and shall
be payable quarterly on the first Business Day of each quarter during the
Revolving Commitment Period, commencing on the first such date to occur after
July 1, 2007 and on the Revolving Commitment Termination Date; and

(ii)                                  Section
2.10(a)(ii) and Section 2.10(b)(i) shall be calculated on the basis of a 360-day
year and the actual number of days elapsed and shall be payable quarterly in
arrears on April 1, July 1, October 1 and January 1 of each year during the
Revolving Commitment Period, 

 56
 

commencing on the first such date to occur after July 1, 2007 and on
the Revolving Commitment Termination Date.

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

2.11                            Voluntary
Prepayments.  The Borrower may prepay
the outstanding principal amount of the Revolving Loans, Swing Line Loans and
Protective Advances in whole or in part at any time; provided that any
such prepayment shall be, in the case of Revolving Loans, in a minimum principal
amount of $1,000,000 or an integral multiple of $1,000,000 in excess thereof
(except during any Voluntary Cash Management Period, during which such minimum
denominations shall not apply); provided, further, that if any
prepayment of any Eurodollar Rate Loan is made by the Borrower other than on
the last day of an Interest Period for such Loan, the Borrower shall also pay
any amount owing pursuant to Section 2.17(d). 
Any such voluntary prepayment shall be applied as specified in Section
2.14(a).

2.12                            Voluntary
Revolving Commitment Reductions.

(a)                                  The
Borrower may, upon not less than three Business Days’ prior written or
telephonic notice confirmed in writing to the Administrative Agent (which
original written or telephonic notice the Administrative Agent will promptly
transmit by telefacsimile or telephone to each Lender), at any time and from
time to time terminate in whole or permanently reduce in part, without premium
or penalty, the Revolving Commitments in an amount up to the amount by which
the Revolving Commitments exceed the Revolving Credit Outstandings at the time
of such proposed termination or reduction; provided, any such partial
reduction of the Revolving Commitments shall be in an aggregate minimum amount
of $10,000,000 and integral multiples of $1,000,000 in excess of that amount.

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

2.13                            Mandatory
Prepayments.

(a)                                  Asset
Sales.  No later than the first
Business Day following the date of receipt by the Borrower or any of its
Subsidiaries of any Net Asset Sale Proceeds in excess of $5,000,000 since the
later of (x) the date of this Agreement and (y) the last mandatory prepayment
pursuant to this Section 2.13(a), (other than any such Net Asset Sale Proceeds
which would also constitute Net Insurance/Condemnation Proceeds) with respect
to Current Asset Collateral, the Borrower shall prepay the Loans as set forth
in Section 2.14(a) in an aggregate amount equal to such Net Asset Sale Proceeds;
provided, so long as no Liquidity Event Period shall be continuing, the
Borrower shall have the option, directly or through one or more Subsidiaries,
to invest Net Asset Sale Proceeds in productive assets of the general type used
in the business of the Borrower and its Subsidiaries (including Permitted
Acquisitions) within one hundred and eighty days of receipt of such Net Asset
Sale Proceeds.

(b)                                 Insurance/Condemnation
Proceeds.  No later than the first
Business Day following the date of receipt by the Borrower or any of its
Subsidiaries, or the Collateral Agent as loss payee, of any Net
Insurance/Condemnation Proceeds with respect to Current Asset Collateral, the
Borrower shall prepay the Loans as set forth in Section 2.14(a) in an aggregate
amount equal to such Net Insurance/Condemnation Proceeds; provided, so
long as no Liquidity Event Period shall be continuing, the Borrower shall have
the option, directly or through one or more Subsidiaries, to invest such Net

 57
 

Insurance/Condemnation Proceeds in productive
assets of the general type used in the business of the Borrower and its
Subsidiaries (including Permitted Acquisitions) within one hundred and eighty
days of receipt of such Net Insurance/Condemnation Proceeds.

(c)                                  Maximum
Credit.  If at any time, the
aggregate principal amount of Revolving Credit Outstandings exceeds the
aggregate Maximum Credit at such time, the Borrower shall forthwith prepay the
Protective Advances first, the Swing Line Loans second and then the Revolving
Loans then outstanding in an amount equal to such excess.  If any such excess remains after repayment in
full of the aggregate outstanding Protective Advances, Swing Line Loans and
Revolving Loans, the Borrower shall cash collateralize Letters of Credit in the
manner set forth in Section 8.2 in an amount equal to 105% of such excess.

(d)                                 Cash
Dominion During a Liquidity Event Period. 
The Borrower hereby irrevocably waives the right to direct, during a
Liquidity Event Period, the application of all funds in each Cash Collateral
Account and agrees that the Administrative Agent may or, upon the written
direction of the Requisite Lenders given at any time during such Liquidity
Event Period, shall (i) deliver a Blockage Notice to each Deposit Account
Bank for each Approved Deposit Account and require all amounts on deposit in
each Approved Deposit Account be transferred to the Concentration Account at
the end of each Business Day and (ii) except, as provided in Section
2.15(h) and (i), following the occurrence and during the continuance of a
Liquidity Event Period, apply all payments in respect of any Obligations and
all available funds in the Concentration Account and each Cash Collateral
Account on a daily basis as follows:  first, to repay the outstanding principal amount of the Swing
Line Loans and Protective Advances until such Swing Line Loans and Protective
Advances have been repaid in full; second, to
repay the outstanding principal balance of the Revolving Loans until such
Revolving Loans shall have been repaid in full; and then
to any other Obligation then due and payable. 
The Administrative Agent agrees so to apply such funds and the Borrower
consents to such application.  If (i)
following such application or (ii) after all Letters of Credit shall have
expired or be fully drawn and all Revolving Commitments shall have been terminated,
there are no Loans outstanding and no other Obligations that are then due and
payable (and, during a Liquidity Event Period, cash collateral has been
provided in an amount equal to 105% of the Letter of Credit Obligations in the
manner required in Section 8.2 (Actions in Respect of Letters of Credit)), then
the Administrative Agent shall cause any remaining funds in the Cash Collateral
Accounts to be paid at the written direction of the Borrower (or, in the
absence of such direction, to the Borrower or another Person lawfully entitled
thereto).

(e)                                  Prepayment
Certificate.  Concurrently with any
prepayment of the Loans pursuant to Sections 2.13(a) or (b), the Borrower shall
deliver to the Administrative Agent a certificate of an Authorized Officer
demonstrating the calculation of the amount of the applicable net proceeds, as
the case may be.  In the event that the
Borrower shall subsequently determine that the actual amount received exceeded
the amount set forth in such certificate, the Borrower shall promptly make an
additional prepayment of the Loans and the Borrower shall concurrently
therewith deliver to the Administrative Agent a certificate of an Authorized
Officer demonstrating the derivation of such excess.

2.14                            Application
of Prepayments.

(a)                                  Application
of Voluntary and Mandatory Prepayments by Type of Loans.  Any prepayment of any Loan pursuant to
Sections 2.11 or 2.13(a) or (b), shall be applied, other than in respect of prepayments
made with the Net Asset Sale Proceeds and/or Net Insurance/Condemnation
Proceeds in respect of which the Borrower shall have notified the
Administrative Agent in writing (each such notice, a “Reinvestment
Notice”) of its intent to reinvest such Net Asset Sale Proceeds
and/or Net Insurance/Condemnation Proceeds, as applicable, in accordance with
Section 2.13(a) or (b), as applicable, as specified by the Borrower in the
applicable notice of prepayment; provided, in the event the Borrower 

 58
 

fails to specify the Loans to which any such
prepayment shall be applied, such prepayment shall be applied:  first, to repay outstanding Swing Line
Loans and Protective Advances to the full extent thereof; and second, to repay outstanding Revolving
Loans to the full extent thereof.  Notwithstanding
anything in this clause (a) to the contrary, if the Borrower shall have
delivered a Reinvestment Notice with respect to any of the events which would
otherwise give rise to a mandatory prepayment of the Loans pursuant to clauses
(a) or (b) of Section 2.13, the Borrower shall be required to make a prepayment
of the Loans in an amount equal to the amount that would be required to so
prepay the Loans less any amounts reinvested as provided in such clauses (a) or
(b), as applicable, on the expiration of the reinvestment period described in
such clauses (a) or (b), as applicable.

(b)                                 Application
of Prepayments of Loans to Base Rate Loans and Eurodollar Rate Loans.  Any prepayment of Loans shall be applied
first to Base Rate Loans to the full extent thereof before application to
Eurodollar Rate Loans, in each case in a manner which minimizes the amount of
any payments required to be made by the Borrower pursuant to Section 2.17(d).

2.15                            General
Provisions Regarding Payments.

(a)                                  All
payments by the Borrower of principal, interest, fees and other Obligations
shall be made in Dollars in same day funds, without defense, setoff or
counterclaim, free of any restriction or condition, and delivered to the
Administrative Agent not later than 11:00 a.m. (New York City time) on the date
due at the Principal Office designated by the Administrative Agent for the
account of Lenders; for purposes of computing interest and fees, funds received
by the Administrative Agent after that time on such due date shall be deemed to
have been paid by the Borrower on the next succeeding Business Day.

(b)                                 All
payments in respect of the principal amount of any Loan (other than voluntary
prepayments of Revolving Loans) shall be accompanied by payment of accrued
interest on the principal amount being repaid or prepaid.

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

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

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

(f)                                    The
Borrower hereby authorizes the Administrative Agent to charge the Borrower’s accounts
with the Administrative Agent in order to cause timely payment to be made to
the Administrative Agent of all principal, interest, fees and expenses due
hereunder (subject to sufficient funds being available in its accounts for that
purpose).

 59

 

(g)                                 The
Administrative Agent shall deem any payment by or on behalf of the Borrower hereunder
that is not made in same day funds prior to 12:00 p.m. (New York City time) to
be a non-conforming payment.  Any
such payment shall not be deemed to have been received by the Administrative
Agent until the later of (i) the time such funds become available funds, and
(ii) the applicable next Business Day. 
The Administrative Agent shall give prompt telephonic notice to the
Borrower and each applicable Lender (confirmed in writing) if any payment is
non-conforming.  Any non-conforming
payment may constitute or become a Default or Event of Default in accordance
with the terms of Section 8.1(a). 
Interest shall continue to accrue on any principal as to which a non-conforming
payment is made until such funds become available funds (but in no event less
than the period from the date of such payment to the next succeeding applicable
Business Day) at the rate determined pursuant to Section 2.9 from the date such
amount was due and payable until the date such amount is paid in full.

(h)                                 Except
for payments and other amounts received by the Administrative Agent and applied
in accordance with the provisions of clause (i) below (or required to be
applied in accordance with Section 2.14(b)), all payments and any other amounts
received by the Administrative Agent from or for the benefit of the Borrower
shall be applied as follows:  first, to
pay principal of, and interest on, any portion of the Loans the Administrative
Agent may have advanced pursuant to the express provisions of this Agreement on
behalf of any Lender, for which the Administrative Agent has not then been reimbursed
by such Lender or the Borrower, second, to pay all other Obligations then due
and payable and third, as the Borrower so designates.  Payments in respect of Swing Line Loans received
by the Administrative Agent shall be distributed to the Swing Line Lender;
payments in respect of Revolving Loans received by the Administrative Agent
shall be distributed to each Lender in accordance with such Lender’s Pro Rata
Share; and all payments of fees and all other payments in respect of any other
Obligation shall be allocated among such of the Lenders and Issuing Banks as
are entitled thereto and, for such payments allocated to the Lenders, in
proportion to their respective Pro Rata Shares.

(i)                                     The
Borrower hereby irrevocably waives, to the fullest extent permitted under
applicable law,  the right to direct the
application of any and all payments in respect of the Obligations and any proceeds
of Collateral after the occurrence and during the continuance of an Event of
Default and agrees that, subject to the Intercreditor Agreement, notwithstanding
the provisions of Section 2.14(a) and clause (h) above, if an Event of Default
shall have occurred and not otherwise been waived, the Administrative Agent
may, and, upon either (A) the written direction of the Requisite Lenders or (B)
the acceleration of the Obligations pursuant to Section 8.1, shall, deliver a
Blockage Notice to each Deposit Account Bank for each Approved Deposit Account
and apply all payments in respect of any Obligations and all funds on deposit
in any Cash Collateral Account and all other proceeds of Collateral in the
following order:

(i)                                     first, to pay any Secured Party Expenses then due to the
Administrative Agent under the Credit Documents;

(ii)                                  second,
to pay any Secured Party Expenses then due to the other Secured Parties under
the Credit Documents, on a ratable basis;

(iii)                               third,
to pay Obligations in respect of any fees then due to the Facility Agents, the
Lenders and the Issuing Banks;

(iv)                              fourth,
to pay all Protective Advances;

(v)                                 fifth,
ratably to pay interest due in respect of the Loans (other than Protective
Advances) and Reimbursement Obligations;

 60
 

(vi)                              sixth,
to pay or prepay principal amounts on the Loans (other than Protective Advances)
and Reimbursement Obligations, to provide cash collateral for outstanding
Letter of Credit Undrawn Amounts in the manner described in Section 8.2,
ratably to the aggregate principal amount of such Loans, Reimbursement
Obligations and Letter of Credit Undrawn Amounts;

(vii)                           seventh,
to pay amounts owing in respect of Cash Management Obligations and Hedging
Agreements, to be applied ratably to the obligations owing with respect to such
Cash Management Obligations and such Hedging Agreements;

(viii)                        eighth,
to pay any other Obligations, and

(ix)                                ninth,
to Borrower or such other Person entitled thereto under applicable law;

provided, however, that if sufficient
funds are not available to fund all payments to be made in respect of any
Obligation described in any of clauses (i) through (viii) above the available
funds being applied with respect to any such Obligation (unless otherwise
specified in such clause) shall be allocated to the payment of such Obligation
ratably, based on the proportion of the applicable Facility Agent’s and each
Lender’s, Issuing Bank’s or Approved Counterparty interest in the aggregate
outstanding Obligations described in such clauses; provided, however,
that payments that would otherwise be allocated to the Lenders shall be
allocated first to repay Swing Line Loans until such Swing Line Loans are paid
in full and then to repay the Revolving Loans.

(j)                                     At
the option of the Administrative Agent, principal on the Swing Line Loans, Reimbursement
Obligations, interest, fees, expenses and other sums due and payable in respect
of the Revolving Loans may be paid from the proceeds of Swing Line Loans or
Revolving Loans.  The Borrower hereby
authorizes the Swing Line Lender to make such Swing Line Loans pursuant to Section
2.2 and the Lenders to make such Revolving Loans pursuant to Section 2.1 from
time to time in the amounts of any and all principal payable with respect to
the Swing Line Loans, Reimbursement Obligations, interest, fees, expenses and
other sums payable in respect of the Revolving Loans, and further authorizes
the Administrative Agent to give the Lenders notice of any Credit Extension
with respect to such Swing Line Loans and Revolving Loans and to distribute the
proceeds of such Swing Line Loans and Revolving Loans to pay such amounts.  The Borrower agrees that all such Swing Line
Loans and Revolving Loans so made shall be deemed to have been requested by it
(irrespective of the satisfaction of the conditions in Section 3.2, which
conditions the Lenders irrevocably waive) and directs that all proceeds thereof
shall be used to pay such amounts.

2.16                            Ratable
Sharing.  Subject to the
Intercreditor Agreement, the Lenders hereby agree among themselves that, except
as otherwise provided in the Collateral Documents with respect to amounts
realized from the exercise of rights with respect to Liens on the Collateral,
if any of them shall, whether by voluntary payment (other than a voluntary
prepayment of Loans made and applied in accordance with the terms hereof),
through the exercise of any right of set-off or banker’s lien, by
counterclaim or cross action or by the enforcement of any right under the
Credit Documents or otherwise, or as adequate protection of a deposit treated
as cash collateral under the Bankruptcy Code, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, amounts payable in
respect of Letters of Credit, fees and other amounts then due and owing to such
Lender hereunder or under the other Credit Documents (collectively, the “Aggregate Amounts Due” to such Lender)
which is greater than the proportion received by any other Lender in respect of
the Aggregate Amounts Due to such other Lender, then the Lender receiving such
proportionately greater payment shall (a) notify the Administrative Agent
and each other Lender of the receipt of such payment and (b) apply a
portion of such payment to purchase participations (which it shall be deemed to
have purchased from each seller of a participation simultaneously upon the
receipt by such seller of its portion of such payment) in the Aggregate Amounts
Due to the 

 61
 

other Lenders so that all such recoveries of
Aggregate Amounts Due shall be shared by all Lenders in proportion to the
Aggregate Amounts Due to them; provided, if all or part of such
proportionately greater payment received by such purchasing Lender is
thereafter recovered from such Lender upon the bankruptcy or reorganization of
the Borrower or otherwise, those purchases shall be rescinded and the purchase
prices paid for such participations shall be returned to such purchasing Lender
ratably to the extent of such recovery, but without interest.  The Borrower expressly consents to the
foregoing arrangement and agrees that any holder of a participation so
purchased may exercise any and all rights of banker’s lien, set-off or
counterclaim with respect to any and all monies owing by the Borrower to that
holder with respect thereto as fully as if that holder were owed the amount of
the participation held by that holder.

2.17                            Making
or Maintaining Eurodollar Rate Loans.

(a)                                  Determination
of Interest Rate.  The Eurodollar
Rate for each Interest Period for Eurodollar Rate Loans shall be determined by
the Administrative Agent pursuant to the procedures set forth in the definition
of “Eurodollar Rate.”  The Administrative
Agent’s determination shall be presumed to be correct absent manifest error and
shall be binding on the Borrower.

(b)                                 Inability
to Determine Applicable Interest Rate. 
In the event that the Administrative Agent shall have determined (which
determination shall be final and conclusive and binding upon all parties
hereto), on any Interest Payment Date with respect to any Eurodollar Rate
Loans, that by reason of circumstances affecting the London interbank market,
adequate and fair means do not exist for ascertaining the interest rate
applicable to such Loans on the basis provided for in the definition of Eurodollar
Rate, the Administrative Agent shall on such date give notice (by telefacsimile
or by telephone confirmed in writing) to the Borrower and each Lender of such
determination, whereupon (i) no Loans may be made as, or converted to,
Eurodollar Rate Loans until such time as the Administrative Agent notifies the
Borrower and the Lenders that the circumstances giving rise to such notice no
longer exist, and (ii) any Funding Notice or Conversion/Continuation Notice
given by the Borrower with respect to the Loans in respect of which such
determination was made shall be deemed to be rescinded by the Borrower.

(c)                                  Illegality
or Impracticability of Eurodollar Rate Loans.  In the event that on any date any Lender
shall have determined (which determination shall be final and conclusive and
binding upon all parties hereto but shall be made only after consultation with
the Borrower and the Administrative Agent) that the making, maintaining or
continuation of its Eurodollar Rate Loans (i) has become unlawful as a result
of compliance by such Lender in good faith with any law, treaty, governmental
rule, regulation, guideline, order or Governmental Authorization (or would
conflict with any such treaty, governmental rule, regulation, guideline, order
or Governmental Authorization not having the force of law even though the
failure to comply therewith would not be unlawful), or (ii) has become impracticable,
as a result of contingencies occurring after the date hereof which materially
and adversely affect the London interbank market or the position of such Lender
in that market, then, and in any such event, such Lender shall be an “Affected Lender” and it shall on that day
give notice (by telefacsimile or by telephone confirmed in writing) to the
Borrower and the Administrative Agent of such determination (which notice the
Administrative Agent shall promptly transmit to each other Lender).  Thereafter (1) the obligation of the Affected
Lender to make Loans as, or to convert Loans to, Eurodollar Rate Loans shall be
suspended until such notice shall be withdrawn by the Affected Lender, (2) to
the extent such determination by the Affected Lender relates to a Eurodollar
Rate Loan then being requested by the Borrower pursuant to a Funding Notice or
a Conversion/Continuation Notice, the Affected Lender shall make such Loan as
(or continue such Loan as or convert such Loan to, as the case may be) a Base
Rate Loan, (3) the Affected Lender’s obligation to maintain its outstanding
Eurodollar Rate Loans (the “Affected Loans”)
shall be terminated at the earlier to occur of the expiration of the Interest
Period then in effect with respect to the Affected Loans or when required by
law, and (4) the Affected Loans shall automatically convert into Base Rate
Loans on the date of such termination. 
Notwithstanding the foregoing, to the extent a determination by an
Affected 

 62
 

Lender as described above relates to a
Eurodollar Rate Loan then being requested by the Borrower pursuant to a Funding
Notice or a Conversion/Continuation Notice, the Borrower shall have the option,
subject to the provisions of Section 2.17(d), to rescind such Funding Notice or
Conversion/Continuation Notice as to all Lenders by giving notice (by
telefacsimile or by telephone confirmed in writing) to the Administrative Agent
of such rescission on the date on which the Affected Lender gives notice of its
determination as described above (which notice of rescission the Administrative
Agent shall promptly transmit to each other Lender).  Except as provided in the immediately preceding
sentence, nothing in this Section 2.17(c) shall affect the obligation of any
Lender other than an Affected Lender to make or maintain Loans as, or to
convert Loans to, Eurodollar Rate Loans in accordance with the terms hereof.

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

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

(f)                                    Assumptions
Concerning Funding of Eurodollar Rate Loans.  Calculation of all amounts payable to a
Lender under this Section 2.17 and under Section 2.18 shall be made as though
such Lender had actually funded each of its relevant Eurodollar Rate Loans
through the purchase of a Eurodollar deposit bearing interest at the rate
obtained pursuant to the first sentence of the definition of Eurodollar Base
Rate in an amount equal to the amount of such Eurodollar Rate Loan and having a
maturity comparable to the relevant Interest Period and through the transfer of
such Eurodollar deposit from an offshore office of such Lender to a domestic
office of such Lender in the United States of America; provided, however,
each Lender may fund each of its Eurodollar Rate Loans in any manner it sees
fit and the foregoing assumptions shall be utilized only for the purposes of
calculating amounts payable under this Section 2.17 and under Section 2.18.

2.18                            Increased
Costs; Capital Adequacy.

(a)                                  Compensation
for Increased Costs and Taxes. 
Subject to the provisions of Section 2.19 (which shall be controlling
with respect to the matters covered thereby), in the event that any Lender
(which term shall include the Issuing Banks for purposes of this Section
2.18(a)) shall determine (which determination shall, absent manifest error, be
final and conclusive and binding upon all parties hereto) that any law, treaty
or governmental rule, regulation, order or Governmental Authorization, or any
change therein or in the interpretation, administration or application thereof
(including the introduction of any new law, treaty or governmental rule,
regulation, order or Governmental Authorization), or any determination of a
court or Governmental Authority, in each case that becomes effective after the
date hereof, or compliance by such Lender with any guideline, request or
directive issued or made after the date hereof 

 63
 

by any central bank or other governmental or
quasi-governmental authority (whether or not having the force of
law):  (i) subjects such Lender (or its
applicable lending office) to any additional Tax (other than any Tax on the
overall net income of such Lender) with respect to this Agreement or any of the
other Credit Documents or any of its obligations hereunder or thereunder or any
payments to such Lender (or its applicable lending office) of principal,
interest, fees or any other amount payable hereunder or thereunder; (ii)
imposes, modifies or holds applicable any reserve (including any marginal,
emergency, supplemental, special or other reserve), special deposit, compulsory
loan, FDIC insurance or similar requirement against assets held by, or deposits
or other liabilities in or for the account of, or advances or loans by, or
other credit extended by, or any other acquisition of funds by, any office of
such Lender (other than any such reserve or other requirements with respect to
Eurodollar Rate Loans that are reflected in the definition of Eurodollar Rate);
or (iii) imposes any other condition (other than with respect to a Tax matter)
on or affecting such Lender (or its applicable lending office) or its
obligations hereunder or the London interbank market; and the result of any of
the foregoing is to increase the cost to such Lender of agreeing to make,
making or maintaining Loans hereunder or to reduce any amount received or receivable
by such Lender (or its applicable lending office) with respect thereto; then,
in any such case, the Borrower shall promptly pay to such Lender, upon receipt
of the statement referred to in the next sentence, such additional amount or
amounts (in the form of an increased rate of, or a different method of calculating,
interest or otherwise as such Lender in its sole discretion shall determine) as
may be necessary to compensate such Lender for any such increased cost or
reduction in amounts received or receivable hereunder or thereunder.  Such Lender shall deliver to the Borrower
(with a copy to the Administrative Agent) a written statement, setting forth in
reasonable detail the basis for calculating the additional amounts owed to such
Lender under this Section 2.18(a), which statement shall be conclusive and
binding upon all parties hereto absent manifest error.

(b)                                 Capital
Adequacy Adjustment.  In the event
that any Lender (which term shall include Issuing Bank for purposes of this
Section 2.18(b)) shall have determined that the adoption, effectiveness, phase-in
or applicability after the Closing Date of any law, rule or regulation (or any
provision thereof) regarding capital adequacy, or any change therein or in the
interpretation or administration thereof by any Governmental Authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Lender (or its applicable lending office) with
any guideline, request or directive regarding capital adequacy (whether or not
having the force of law) of any such Governmental Authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on the capital of such Lender or any corporation controlling such Lender as a
consequence of, or with reference to, such Lender’s Loans or Revolving
Commitments or Letters of Credit, or participations therein or other
obligations hereunder with respect to the Loans or the Letters of Credit to a
level below that which such Lender or such controlling corporation could have
achieved but for such adoption, effectiveness, phase-in, applicability,
change or compliance (taking into consideration the policies of such Lender or
such controlling corporation with regard to capital adequacy), then from time
to time, within five Business Days after receipt by the Borrower from such
Lender of the statement referred to in the next sentence, the Borrower shall
pay to such Lender such additional amount or amounts as will compensate such
Lender or such controlling corporation on an after-tax basis for such
reduction. Such Lender shall deliver to the Borrower (with a copy to the
Administrative Agent) a written statement, setting forth in reasonable detail
the basis for calculating the additional amounts owed to Lender under this
Section 2.18(b), which statement shall be conclusive and binding upon all
parties hereto absent manifest error.

2.19                            Taxes;
Withholding, etc.

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

 64
 

(b)                                 Withholding
of Taxes.  If any Credit Party or any
other Person is required by law to make any deduction or withholding on account
of any such Tax from any sum paid or payable by any Credit Party to the Administrative
Agent, the Collateral Agent, or
any Lender (which term shall include Issuing Bank for purposes of this
Section 2.19) under any of the Credit Documents:  (i) the Borrower shall notify the
Administrative Agent of any such requirement or any change in any such
requirement as soon as the Borrower becomes aware of it; (ii) the Borrower
shall pay any such Tax before the date on which penalties attach thereto, such
payment to be made (if the liability to pay is imposed on any Credit Party) for
its own account or (if that liability is imposed on the Administrative Agent,
the Collateral Agent or such Lender, as the case may be) on behalf of and in the
name of the Administrative Agent, the Collateral Agent or such Lender; (iii) except to the extent of a Tax on the overall
net income of the recipient, the sum payable by such Credit Party in
respect of which the relevant deduction, withholding or payment is required
shall be increased to the extent necessary to ensure that, after the making of that deduction,
withholding or payment (including any
deduction, withholding, or payment attributable to amounts payable under this
Section 2.19), the Administrative Agent, the Collateral Agent or such
Lender, as the case may be, receives on the due date a net sum equal to what it
would have received had no such deduction, withholding or payment been required
or made; and (iv) within thirty days after paying any sum from which it is required
by law to make any deduction or withholding, and within thirty days after the
due date of payment of any Tax which it is required by clause (ii) above to
pay, the Borrower shall deliver to the Administrative Agent evidence satisfactory
to the other affected parties of such deduction, withholding or payment and of
the remittance thereof to the relevant taxing or other authority; provided,
no such additional amount shall be required to be paid to any Non-US Lender under clause (iii) above
in respect of U.S. federal withholding tax imposed on
amounts payable to a Non-US
Lender at the time such Non-US Lender becomes a party hereto (or designates a
new lending office), except to
the extent that such Non-US Lender (or its assignor, if any) was entitled, at
the time of designation of a new lending office (or assignment), to receive
additional amounts from any Credit
Party with respect to such withholding tax pursuant to this Section 2.19.

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

(d)                                 Indemnification
by the Borrower.  The Borrower
shall indemnify the Administrative Agent, each Lender and the Collateral Agent, within 10 Business
Days after written demand therefor, for the full amount of any Taxes (other than a Tax on the overall net
income) or Other Taxes (including such Taxes or Other Taxes imposed or asserted on or attributable
to amounts payable under this Section) payable by the Administrative Agent, the Collateral Agent or such
Lender, as the case may be, and reasonable expenses arising therefrom or with
respect thereto, whether or not such Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such
payment or liability delivered to the
Borrower by a Lender or the Collateral
Agent (with a copy to the Administrative Agent), or by the
Administrative Agent on its own behalf or on behalf of a Lender, setting forth
in reasonable detail the manner in which such amount was determined, shall be
conclusive absent manifest error.

(e)                                  Evidence
of Exemption from U.S. Federal Withholding
Tax.  To the extent it is legally entitled to do so: each Lender that
is not a United States Person (as such term is defined in Section 7701(a)(30)
of the Internal Revenue Code) for U.S. federal income tax purposes (a “Non-US Lender”) shall deliver to the
Administrative Agent for transmission to the Borrower, on or prior to the
Closing Date (in the case of each Lender listed on the signature pages hereof
on the Closing Date) or on or prior to the date of the Assignment Agreement
pursuant to which it becomes a Lender (in the case of each other Lender), and
at such other times as may be necessary in the determination of the Borrower or
the Administrative Agent (each in the reasonable exercise of its discretion),
(i) two original copies of Internal Revenue 

 65
 

Service Form W-8BEN or W-8ECI (or
any successor forms), properly completed and duly executed by such Lender, and
such other documentation required under the Internal Revenue Code and reasonably
requested by the Borrower to establish that such Lender is not subject to deduction
or withholding of United States federal income tax with respect to any payments
to such Lender of principal, interest, fees or other amounts payable under any
of the Credit Documents, or (ii) if such Lender is not a “bank” or other Person
described in Section 881(c)(3) of the Internal Revenue Code and cannot
deliver either Internal Revenue Service Form W-8ECI or Form W-8BEN pursuant to clause (i)
above, a Certificate re Non-Bank Status together with two original copies
of Internal Revenue Service Form W-8BEN (or any successor form), properly
completed and duly executed by such Lender, and such other documentation
required under the Internal Revenue Code and reasonably requested by the
Borrower to establish that such Lender is not subject to deduction or
withholding of United States federal income tax with respect to any payments to
such Lender of interest payable under any of the Credit Documents, or (iii) to the extent such Non-US Lender
is not the beneficial owner (for example, where the Non-US lender is a partnership
or participating Lender granting a typical participation), two original copies
of Internal Revenue Service Form W-8IMY (or any successor form), accompanied by Form W-8ECI, W-8BEN, Certificate re Non-Bank
Status or W-8BEN from each beneficial
owner, as applicable.  Each Lender
required to deliver any forms, certificates or other evidence with respect to
United States federal income tax withholding matters pursuant to this Section
2.19(e) hereby agrees, from time to time after the initial
delivery by such Lender of such forms, certificates or other evidence, whenever
a lapse in time or change in circumstances renders such forms, certificates or
other evidence obsolete or inaccurate in any material respect, that such Lender
shall promptly deliver to the Administrative Agent for transmission to the
Borrower two new original copies of Internal Revenue Service Form W-8BEN
or W-8ECI , or a Certificate re Non-Bank Status and two original
copies of Internal Revenue Service Form W-8BEN (or any successor form) or W-8IMY and the accompanying forms or
certificates, as the case may be, properly completed and duly executed
by such Lender, and such other documentation required under the Internal
Revenue Code and reasonably requested by the Borrower to confirm or establish
that such Lender is not subject to deduction or withholding of United States
federal income tax with respect to payments to such Lender under the Credit
Documents, or notify the Administrative Agent and the Borrower of its inability
to deliver any such forms, certificates or other evidence.  The Borrower shall not be required to pay any
additional amount to any Non-US Lender under Section 2.19(b)(iii) to the extent that the U.S. federal withholding
tax results from such Non-US Lender’s failure to deliver any such form or certificate that such Non-US Lender is legally entitled to deliver.

2.20                            Obligation
to Mitigate.  Each Lender (which term
shall include Issuing Bank for purposes of this Section 2.20) agrees that, as
promptly as practicable after the officer of such Lender responsible for
administering its Loans or Letters of Credit, as the case may be, becomes aware
of the occurrence of an event or the existence of a condition that would cause
such Lender to become an Affected Lender or that would entitle such Lender to
receive payments under Section 2.17, 2.18 or 2.19, it will, to the extent
not inconsistent with the internal policies of such Lender and any applicable
legal or regulatory restrictions, use reasonable efforts to (a) make, issue,
fund or maintain its Credit Extensions, including any Affected Loans, through
another office of such Lender, or (b) take such other measures as such
Lender may deem reasonable, if as a result thereof the circumstances which
would cause such Lender to be an Affected Lender would cease to exist or the
additional amounts which would otherwise be required to be paid to such Lender
pursuant to Section 2.17, 2.18 or 2.19 would be materially reduced and if,
as determined by such Lender in its sole discretion, the making, issuing,
funding or maintaining of such Revolving Commitments, Loans or Letters of
Credit through such other office or in accordance with such other measures, as
the case may be, would not otherwise adversely affect such Revolving Commitments,
Loans or Letters of Credit or the interests of such Lender; provided,
such Lender will not be obligated to utilize such other office or take other
measures pursuant to this Section 2.20 unless the Borrower agrees to pay all
incremental expenses incurred by such Lender as a result of utilizing such
other office or take other measures as described above.  A certificate as to the amount of any such
expenses payable by the 

 66
 

Borrower pursuant to this Section 2.20
(setting forth in reasonable detail the basis for requesting such amount)
submitted by such Lender to the Borrower (with a copy to the Administrative
Agent) shall be conclusive absent manifest error.

2.21                            Defaulting
Lenders.  Anything contained herein
to the contrary notwithstanding, in the event that any Lender, other than at
the direction or request of any Governmental Authority, defaults (a “Defaulting Lender”) in its obligation to
fund (a “Funding Default”) any
Revolving Loan, its portion of any participation in a Protective Advance
required to be funded by it hereunder within one (1) Business Day of the date
required to be funded by it hereunder or its portion of any unreimbursed
payment under Section 2.2 or 2.3 (in each case, a “Defaulted Loan”), then (a) during any Default Period with
respect to such Defaulting Lender, such Defaulting Lender shall be deemed not
to be a “Lender” for purposes of voting on any matters (including the granting
of any consents or waivers) with respect to any of the Credit Documents;
(b) to the extent permitted by applicable law, until such time as the
Default Excess with respect to such Defaulting Lender shall have been reduced
to zero, (i) any voluntary prepayment of the Revolving Loans shall, if the
Borrower so directs at the time of making such voluntary prepayment, be applied
to the Revolving Loans of other Lenders as if such Defaulting Lender had no
Revolving Loans outstanding and the Revolving Credit Exposure of such
Defaulting Lender were zero, and (ii) any mandatory prepayment of the
Revolving Loans shall, if the Borrower so directs at the time of making such
mandatory prepayment, be applied to the Revolving Loans of other Lenders (but
not to the Revolving Loans of such Defaulting Lender) as if such Defaulting
Lender had funded all Defaulted Loans of such Defaulting Lender, it being
understood and agreed that the Borrower shall be entitled to retain any portion
of any mandatory prepayment of the Revolving Loans that is not paid to such
Defaulting Lender solely as a result of the operation of the provisions of this
clause (b); (c) such Defaulting Lender’s Revolving Commitment and
outstanding Revolving Loans and such Defaulting Lender’s Pro Rata Share of the
Letter of Credit Usage shall be excluded for purposes of calculating the
Revolving Commitment fee payable to Lenders in respect of any day during any
Default Period with respect to such Defaulting Lender, and such Defaulting
Lender shall not be entitled to receive any Revolving Commitment fee pursuant
to Section 2.10 with respect to such Defaulting Lender’s Revolving Commitment
in respect of any Default Period with respect to such Defaulting Lender; and
(d) the Revolving Credit Outstandings as at any date of determination
shall be calculated as if such Defaulting Lender had funded all Defaulted Loans
of such Defaulting Lender.  No Revolving
Commitment of any Lender shall be increased or otherwise affected, and, except
as otherwise expressly provided in this Section 2.21, performance by the
Borrower of its obligations hereunder and the other Credit Documents shall not
be excused or otherwise modified as a result of any Funding Default or the
operation of this Section 2.21.  The
rights and remedies against a Defaulting Lender under this Section 2.21 are in
addition to other rights and remedies which the Borrower may have against such
Defaulting Lender with respect to any Funding Default and which the
Administrative Agent or any Lender may have against such Defaulting Lender with
respect to any Funding Default.

2.22                            Removal
or Replacement of a Lender.  Anything
contained herein to the contrary notwithstanding, in the event that:  (a) (i) any Lender (an “Increased-Cost Lender”) shall give
notice to the Borrower that such Lender is an Affected Lender or that such
Lender is entitled to receive payments under Section 2.17, 2.18 or 2.19, (ii)
the circumstances which have caused such Lender to be an Affected Lender or
which entitle such Lender to receive such payments shall remain in effect, and
(iii) such Lender shall fail to withdraw such notice within five Business Days
after the Borrower’s request for such withdrawal; or (b) (i) any Lender shall
become a Defaulting Lender, (ii) the Default Period for such Defaulting Lender
shall remain in effect, and (iii) such Defaulting Lender shall fail to cure the
default as a result of which it has become a Defaulting Lender within five
Business Days after the Borrower’s request that it cure such default; or (c) in
connection with any proposed amendment, modification, termination, waiver or
consent with respect to any of the provisions hereof as contemplated by Section
10.5(b), the consent of Requisite Lenders shall have been obtained but the consent
of one or more of such other Lenders (each a “Non-Consenting
Lender”) whose consent is required shall not have been obtained;
then, with respect to 

 67
 

each such Increased-Cost Lender,
Defaulting Lender or Non-Consenting Lender (each, a “Terminated Lender”), the Borrower may, by
giving written notice to the Administrative Agent and any Terminated Lender of
its election to do so, elect to cause such Terminated Lender (and such
Terminated Lender hereby irrevocably agrees) to assign its outstanding Loans
and its Revolving Commitments, if any, in full to one or more Eligible
Assignees (each, a “Replacement Lender”)
in accordance with the provisions of Section 10.6 and such Terminated Lender
shall pay any fees payable thereunder in connection with such assignment; provided,
(1) on the date of such assignment, the Replacement Lender shall pay to Terminated
Lender an amount equal to the sum of (A) an amount equal to the principal of,
and all accrued interest on, all outstanding Loans of the Terminated Lender,
(B) an amount equal to all unreimbursed drawings that have been funded by such
Terminated Lender, together with all then unpaid interest with respect thereto
at such time and (C) an amount equal to all accrued, but theretofore unpaid
fees owing to such Terminated Lender pursuant to Section 2.10; (2) on the date
of such assignment, the Borrower shall pay any amounts payable to such
Terminated Lender pursuant to Section 2.17(c), 2.18 or 2.19, or otherwise as if
it were a prepayment; (3) to the extent an assignment to such Replacement
Lender would require the consent of the Administrative Agent under Section
10.6, such Replacement Lender shall be reasonably acceptable to the
Administrative Agent; (4) in the event such Terminated Lender is a Non-Consenting
Lender, each Replacement Lender shall consent, at the time of such assignment,
to each matter in respect of which such Terminated Lender was a Non-Consenting
Lender; provided, the Borrower may not make such election with respect
to any Terminated Lender that is also an Issuing Bank unless, prior to the
effectiveness of such election, the Borrower shall have caused each outstanding
Letter of Credit issued thereby to be cancelled.  Upon the prepayment of all amounts owing to
any Terminated Lender and the termination of such Terminated Lender’s Revolving
Commitments, such Terminated Lender shall no longer constitute a “Lender” for
purposes hereof; provided, any rights of such Terminated Lender to
indemnification hereunder shall survive as to such Terminated Lender.  Each Lender agrees that, if it becomes a Terminated
Lender and its rights and claims are assigned hereunder to a Replacement Lender
pursuant to this Section 2.22, it shall execute and deliver to the
Administrative Agent an Assignment Agreement to evidence such assignment,
together with any Revolving Loan Note (if such Loans are evidenced by a
Revolving Loan Note) evidencing the Loans subject to such Assignment Agreement;
and (5) no assignment fee pursuant to Section 10.6(f) shall be payable in
respect of such assignment provided, however, that the failure of
any Terminated Lender to execute an Assignment Agreement shall not render such
assignment invalid.

2.23                            Reserves.  Notwithstanding anything to the
contrary, the Administrative Agent may at any time and from time to time in the
exercise of its Permitted Discretion establish and increase or decrease
Reserves; provided that the Administrative Agent shall have provided the
Borrower at least 2 Business Days’ prior written notice of any such
establishment or increase.

SECTION
3.                                      CONDITIONS
PRECEDENT

3.1                                   Closing
Date.  The obligation of each Lender
to make a Credit Extension on the Closing Date is subject to the satisfaction,
or waiver in accordance with Section 10.5, of the following conditions on or
before the Closing Date:

(a)                                  Credit
Documents.  Subject to
Section 5.15(a), the Administrative Agent shall have received sufficient
copies of each Credit Document originally executed and delivered by each applicable
Credit Party for each Lender.

(b)                                 Organizational
Documents; Incumbency.  The
Administrative Agent shall have received (i) copies of the Organizational
Documents of each Credit Party and, to the extent applicable, certified as of a
recent date by the appropriate governmental official; (ii) signature and incumbency
certificates of the officers of such Person executing the Credit Documents to
which it 

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is a party;
(iii) resolutions of the Board of Directors or similar governing body of each
Credit Party approving and authorizing the execution, delivery and performance
of this Agreement and the other Credit Documents and the Related Agreements to
which it is a party or by which it or its assets may be bound as of the Closing
Date, certified as of the Closing Date by its secretary or an assistant
secretary as being in full force and effect without modification or amendment;
and (iv) a “long-form” good standing certificate from the applicable
Governmental Authority of each Credit Party’s jurisdiction of incorporation,
organization or formation, each dated a recent date prior to the Closing Date.

(c)                                  Organizational
and Capital Structure.  The
organizational structure and capital structure of the Borrower and its
Subsidiaries, both before and after giving effect to the Purchase, shall be as
set forth on Schedule 4.1 and Schedule 4.2.

(d)                                 Consummation
of the Acquisition.  The Purchase
shall be consummated concurrently with the occurrence of the Closing Date in
accordance with the Acquisition Agreement, without amendment, modification or
waiver thereof which is adverse to the Lenders in any material respect
(including, without limitation, the Material Adverse Change (as defined in the
Acquisition Agreement) condition set forth in the Acquisition Agreement)
without the prior consent of the Administrative Agent, all as certified in the
Closing Date Certificate.

(e)                                  Term
Loan Facility.  The Administrative
Agent shall have received reasonably satisfactory evidence that, concurrently
with the occurrence of the Closing Date, the “Closing Date” (under and as
defined in the Term Loan Agreement) shall have occurred and the Borrower shall
have received gross cash proceeds from the extensions of credit under the Term
Loan Agreement of not less than $880,000,000.

(f)                                    Bridge
Loans.  The Administrative Agent
shall have received reasonably satisfactory evidence that, concurrently with
the occurrence of the Closing Date, the “Closing Date” (under and as defined in
the Bridge Loan Agreement) shall have occurred and the Borrower shall have
received gross cash proceeds from the extensions of credit under the Bridge
Loan Agreement of not less than $465,000,000.

(g)                                 Refinancing;
Indebtedness.

(i)                  The Refinancing shall have been
consummated and all liens in favor of the existing lenders thereof shall have
been released, in each case, to the satisfaction of the Administrative Agent;
the Administrative Agent shall have received a “pay-off” letter in form and
substance reasonably satisfactory to the Administrative Agent with respect to
all debt being refinanced in the Refinancing; and the Administrative Agent
shall have received such UCC termination statements, mortgage releases,
releases of assignments of leases and rents, releases of security interests in
Intellectual Property and other instruments, in each case in proper form for
recording, as the Administrative Agent shall have reasonably requested to
release and terminate of record the Liens securing such debt.

(ii)               After giving effect to the Transactions,
none of the Borrower or any of its Subsidiaries shall have outstanding any
Indebtedness or Preferred Stock other than (i) the Loans and Credit
Extensions hereunder, (ii)  the Term Loans, (iii) the Bridge Loans,
(iv) the Indebtedness described in Sections 6.1(b) through 6.1(h) or
listed on Schedule 6.1(b) and (v) Indebtedness owed to the
Borrower or any Guarantor.

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

(i)                                     fully
executed and notarized Mortgages, in proper form for recording in all
appropriate places in all applicable jurisdictions, encumbering each Real
Estate Asset listed on Schedule 8(a) to the Perfection Certificate dated
as of the Closing Date (each, a “Closing Date
Mortgaged Property”), together with such certificates, affidavits,
questionnaires or returns as shall be required in connection with the recording
or filing thereof to create a lien under applicable requirements of the
appropriate Governmental Authority, and such financing statements and any other
instruments necessary to grant a mortgage lien under the laws of the applicable
jurisdiction, all of which shall be in form and substance reasonably satisfactory
to Collateral Agent;

(ii)                                  opinions
of Armstrong Teasedale LLP, counsel to the Credit Parties in Illinois and
Nevada, and Cohen & Grigsby, counsel to the Credit Parties in Florida and
Pennsylvania, with respect to the enforceability of the Mortgages to be
recorded in such states and such other matters as the Collateral Agent may
reasonably request, in each case in form and substance reasonably satisfactory
to the Collateral Agent;

(iii)                               (A)
ALTA mortgagee title insurance policies or unconditional commitments therefor
issued by one or more title companies reasonably satisfactory to the Collateral
Agent with respect to each Closing Date Mortgaged Property (each, a “Title Policy”), with liability amounts not
less than those set forth on Schedule 3.1(h) and with respect to each
After-Acquired Mortgaged Property, with liability amounts not less than the
amounts set forth on Schedule 3.1(h), together with a title report
issued by a title company with respect thereto, and copies of all recorded
documents listed as exceptions to title or otherwise referred to therein, each
in form and substance reasonably satisfactory to Collateral Agent, which Title
Policy shall, (1) to the extent necessary, include such reinsurance
arrangements (with provisions for direct access, if necessary) as shall be reasonably
acceptable to the Collateral Agent, (2) contain a “tie-in” or “cluster”
endorsement, if available under applicable law (i.e.,
policies that insure against losses regardless of location or allocated value
of the insured property up to the liability amount), (3) have been supplemented
by such endorsements (or where such endorsements are not available, opinions of
special counsel, architects or other professionals reasonably acceptable to the
Collateral Agent) as shall be reasonably requested by the Collateral Agent
(which endorsements may include matters relating to usury, first loss, last
dollar, zoning, contiguity, revolving credit, doing business, non-imputation,
public road access, survey, variable rate, environmental lien, subdivision,
mortgage recording tax, separate tax lot, revolving credit, and so-called
comprehensive coverage over covenants and restrictions), and (4) contain
no exceptions to title other than exceptions reasonably acceptable to the Collateral
Agent; and (B) with respect to each Closing Date Mortgaged Property, such affidavits,
certificates, information (including financial data) and instruments of
indemnification (including a so-called “gap” indemnification) as shall be
required to induce the title company to issue the Title Policy/ies and endorsements
contemplated above; and (C) evidence satisfactory to the Collateral Agent that
such Credit Party has paid to the title company or to the appropriate
Government Authorities all expenses and premiums of the title company and all
other sums required in connection with the issuance of each Title Policy and
all recording and stamp taxes (including mortgage recording and intangible
taxes) 

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payable in connection with
recording the Mortgages for each Closing Date Mortgaged Property in the appropriate
real estate records;

(iv)                              a
completed Federal Emergency Management Agency standard Flood Hazard
Determination with respect to each Closing Date Mortgaged Property and evidence
of flood insurance with respect to each Flood Hazard Property that is located
in a community that participates in the National Flood Insurance Program, in
each case in compliance with any applicable regulations of the Board of
Governors, in form and substance reasonably satisfactory to the Collateral
Agent;

(v)                                 ALTA
surveys of all Closing Date Mortgaged Properties, as may be reasonably required
by the Collateral Agent, certified to the Collateral Agent and dated not more
than thirty days prior to the Closing Date;

(vi)                              with
respect to each Closing Date Mortgaged Property, such consents, approvals,
amendments, supplements, estoppels, tenant subordination agreements or other
instruments (including, without limitation, Collateral Access Agreements and
Memoranda of Leases) as necessary to consummate the transactions or as shall
reasonably be deemed necessary by the Collateral Agent in order for the owner
or holder of the fee or leasehold interest constituting such Closing Date
Mortgaged Property to grant the Lien contemplated by the Mortgage with respect
to such Closing Date Mortgaged Property

(vii)                           with
respect to each Closing Date Mortgaged Property, copies of all leases in which
Borrower or any Subsidiary holds the lessor’s interest or other agreements
relating to possessory interests, if any. 
To the extent any of the foregoing affect any Closing Date Mortgaged
Property, such agreement shall be subordinate to the Lien of the Mortgage to be
recorded against such Mortgaged Property, either expressly by its terms or
pursuant to a subordination, non-disturbance and attornment agreement, and
shall otherwise be acceptable to the Collateral Agent; and

(viii)                        with
respect to each Closing Date Mortgaged Property, each Company shall have made
all notifications, registrations and filings, to the extent required by, and in
accordance with, all Governmental Authorizations applicable to such Closing
Date Mortgaged Property;

provided,
that to the extent the Borrower or the applicable Guarantor is unable to
deliver to the Collateral Agent on the Closing Date, after using commercially
reasonable efforts to do so, any of the foregoing with respect to any Closing
Date Mortgaged Property, such Credit Party may deliver such documents or other
items to the Collateral Agent within 60 days of the Closing Date.

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

(i)                                     evidence
satisfactory to the Collateral Agent of the compliance by each Credit Party of
its obligations under the Pledge and Security Agreement and the other
Collateral Documents (including, without limitation, its obligation to
authenticate and deliver UCC financing statements and to execute (as
applicable) and deliver originals of securities, 

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instruments and chattel paper
and any Intellectual Property Security Agreements, Deposit Account Control Agreements
and Control Agreements as provided therein);

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

(iii)                               opinions
of counsel (which counsel shall be reasonably satisfactory to Collateral Agent)
with respect to the creation and perfection of the security interests in favor
of the Collateral Agent in such Collateral and such other matters governed by
the laws of each jurisdiction in which any Credit Party is organized, as the
Collateral Agent may reasonably request, in each case in form and substance
reasonably satisfactory to the Collateral Agent; and

(iv)                              except
as provided in Sections 5.15 and 5.16, evidence that each Credit Party shall
have taken or caused to be taken any other action, executed and delivered or
caused to be executed and delivered any other agreement, document and
instrument (including without limitation, any intercompany notes evidencing
Indebtedness permitted to be incurred pursuant to Section 6.1(b)) and made or
caused to be made any other filing and recording (other than as set forth
herein) reasonably required by the Collateral Agent.

(j)                                     Pro
Forma Financial Statements.  Lenders
shall have received from the Borrower (i) the Historical Financial Statements,
and (ii) pro forma consolidated balance sheets of the Borrower and its
Subsidiaries as at the Closing Date, and reflecting the consummation of the
Transactions, which pro forma financial statements shall be in form and
substance satisfactory to the Administrative Agent, together with a certificate
of the Borrower to the effect that such statements accurately present the
estimated pro forma financial position of the Borrower and its Subsidiaries in
all material respects and were prepared in good faith based on management
estimates and assumptions believed to be reasonable when made.

(k)                                  Evidence
of Insurance.  The Collateral Agent
shall have received a certificate from the Borrower’s insurance broker or other
evidence satisfactory to it that all insurance required to be maintained
pursuant to Section 5.5 is in full force and effect, together with endorsements
naming the Collateral Agent, for the benefit of Secured Parties, as additional
insured and loss payee or mortgagee, as applicable, thereunder to the extent
required under Section 5.5.

(l)                                     Opinions
of Counsel to Credit Parties.  The
Agents and the Lenders shall have received favorable written opinions of (i)
Munger, Tolles & Olson LLP, counsel for Credit Parties, in the form of
Exhibit D, (ii) Armstrong Teasedale LLP, counsel to the Credit Parties in
Illinois and Nevada , (iii) Cohen & Grigsby, counsel to the Credit Parties
in Florida and Pennsylvania, and (iv) Latham & Watkins, LLP, counsel to the
Credit Parties in New York, in each case, as to such other matters as the
Administrative Agent may reasonably request, dated as of the Closing Date and
otherwise in form and substance reasonably satisfactory to the Administrative 

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Agent (and
each Credit Party hereby instructs such counsel to deliver such opinions to the
Agents and Lenders).

(m)                               Fees.  The Borrower shall have paid to the Joint
Lead Arrangers and the Facility Agents the fees payable on the Closing Date
referred to in Section 2.10(d).

(n)                                 Representations
and Warranties.  On the Closing Date,
the representations and warranties made by the Credit Parties in
Sections 4.1, 4.3, 4.6, 4.16, 4.17, 4.26 and 4.27 as they relate to the
Credit Parties at such time shall be true and correct in all material respects;
provided that any representation and warranty that is qualified as to
materiality or “Material Adverse Effect” shall be true and correct in all
respects.

(o)                                 Solvency
Certificate.  On the Closing Date,
the Administrative shall have received a Solvency Certificate from the chief
financial officer of the Borrower demonstrating that after giving effect to the
consummation of the Transactions, the Borrower and its Subsidiaries, on a
consolidated basis, are Solvent.

(p)                                 Closing
Date Certificate.  The Borrower shall
have delivered to the Administrative Agent an original executed Closing Date
Certificate, together with all attachments thereto.

(q)                                 Borrowing
Base.  The Administrative Agent shall
have received an up to date Borrowing Base Certificate which meets the
requirements of Section 5.1(o).

(r)                                    Appraisals
and Field Audits.  The Administrative
Agent shall have received customary collateral appraisals and field audits, in
each case reasonably acceptable to the Lead Arranger.

(s)                                  Vendors.  The Administrative Agent shall have received
an officer’s certificate of an Authorized Officer of each applicable Credit
Party, certifying that (i) all Vendors as of the Closing Date are listed on Schedule
3.1(s), and (ii) as to each such Vendor which has a Lien on any Inventory
which is included or proposed to be included in the Borrowing Base as Eligible
Inventory, that (A) attached thereto are true, correct and complete copies of
all applicable Vendor Agreements between such Credit Party and such Vendor, and
(B) all such Vendor Agreements are in full force and effect.

(t)                                    Patriot
Act Information.  Each of the Credit
Parties shall have provided the documentation and other information to the
Lenders that is required by regulatory authorities under applicable “know your
customer” and anti-money-laundering rules and regulations, including, without
limitation, the Patriot Act.

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

3.2                                   Conditions
Precedent to Each Credit Extension.

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

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(a)                                  the
Administrative Agent shall have received (including by email or facsimile
pursuant to Section 10.1(a)) a fully executed and delivered Funding Notice or
Issuance Notice, as the case may be;

(b)                                 after
making the Credit Extensions requested on such Credit Date, the Revolving
Credit Outstandings shall not exceed the Maximum Credit then in effect;

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

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

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

SECTION
4.                                      REPRESENTATIONS
AND WARRANTIES

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

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

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

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Schedule 4.2 correctly sets forth the
ownership interest of the Borrower and each of its Subsidiaries as of the Closing
Date.

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

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

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

4.6                                   Binding
Obligation.  Each Credit Document has
been duly executed and delivered by each Credit Party that is a party thereto
and is the legally valid and binding obligation of such Credit Party,
enforceable against such Credit Party in accordance with its respective terms,
except as may be limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to or limiting creditors’ rights generally or by equitable
principles.

4.7                                   Historical
Financial Statements.  The Historical
Financial Statements were prepared in conformity with GAAP and fairly present,
in all material respects, the financial position, on a consolidated basis, of
the Persons described in such financial statements as at the respective dates
thereof and the results of operations and cash flows, on a consolidated basis,
of the entities described therein for each of the periods then ended, subject,
in the case of any such unaudited financial statements, to changes resulting
from audit and normal year-end adjustments.  As of the Closing Date, neither the Borrower
nor any of its Subsidiaries has any contingent liability or liability for
taxes, long-term lease or unusual forward or long-term commitment
that is not reflected in the Historical Financial Statements or the notes
thereto and which in any such case is material in relation to the business,
operations, properties, assets, condition (financial or otherwise) or results
of operations of the Borrower and any of its Subsidiaries taken as a whole.

 75

 

4.8            Projections.  On and as of the Closing Date, the
Projections of the Borrower and its Subsidiaries for the period of Fiscal Year
2008 through and including Fiscal Year 2015 (the “Projections”) are based on good faith estimates made by the
management of the Borrower based on assumptions
believed to be reasonable when made; provided, that it is understood and agreed that actual results of the
Borrower and its subsidiaries may differ from the results projected in such
Projections and that such differences may be material.

4.9            No Material Adverse Change.  Since January 31, 2007, no event,
circumstance or change has occurred that has caused or evidences, or could
reasonably be expected to result in, either in any case or in the aggregate, a
Material Adverse Effect.

4.10         Insurance.  All policies of insurance of the Borrower or
any of its Subsidiaries, including policies of life, fire, theft, product
liability, public liability, property damage, other casualty, employee
fidelity, workers’ compensation and employee health and welfare insurance, are
in full force and effect and are of a nature and provide such coverage as is
sufficient and as is customarily carried by businesses of the size and
character of such Person.

4.11         Compliance with Laws; Adverse
Proceedings, etc. 
There are no Adverse Proceedings, individually or in the aggregate, that
could reasonably be expected to have a Material Adverse Effect.  Neither the Borrower nor any of its
Subsidiaries (a) is in violation of any applicable laws, statutes, regulations
or orders (including Environmental Laws), or any applicable restrictions
imposed by any Governmental Authority governing the conduct of business or ownership
of property by the Borrower or any such Subsidiary, in each case, that,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect, or (b) is subject to or in default with respect
to any final judgments, writs, injunctions, decrees, rules or regulations of
any court or any federal, state, municipal or other governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign,
that, individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.

4.12         Payment of Taxes.  All
material Tax returns and reports
of the Borrower and its Subsidiaries required to be filed by any of them have
been timely filed and the
Borrower and its Subsidiaries have duly
and timely paid, collected, withheld,
or remitted or caused to be duly and timely paid, collected, withheld, or remitted all material Taxes (whether or not shown
on any Tax return) due and
payable, collectible, withholdable
or remittable by it and all assessments received by it, except Taxes that are
being contested in good faith by appropriate proceedings and for which the Borrower or any of its Subsidiaries
has set aside on its books adequate reserves in accordance with GAAP.

4.13         Properties.

(a)           Title.  Each
of the Borrower and its Subsidiaries has (i) good, marketable title to (in the
case of fee interests in real property), (ii) valid leasehold interests in (in
the case of leasehold interests in real or personal property), and (iii) good
title to (in the case of all other personal property), all of their respective
properties and assets reflected in their respective Historical Financial
Statements referred to in Section 4.5 and in the most recent financial
statements delivered pursuant to Section 5.1, in each case, except for assets
disposed of (or in the case of leasehold interests, where leases have expired)
since the date of such financial statements in the ordinary course of business
or as otherwise permitted under Section 6.8. 
Except as permitted by Section 6.2 of this Agreement, all such properties
and assets are free and clear of Liens.

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(b)           Real Estate.

(i)      Schedules 8(a) and 8(b) to
the Perfection Certificate dated the Closing Date contain a true and complete
list of each interest in all Real Estate Assets (i) owned by any Credit
Party as of the date hereof and describes the type of interest therein held by
such Credit Party and whether such owned Real Estate Asset is leased by any
Credit Party to any Person and if leased by any Credit Party to any Person
whether the underlying lease contains any option to purchase all or any portion
of such Real Estate Asset or any interest therein or contains any right of
first refusal relating to any sale of such Real Estate Asset or any portion
thereof or interest therein and (ii) Real Estate Assets leased, subleased
or otherwise occupied or utilized by any Credit Party, as lessee, sublessee,
franchisee or licensee, as of the date hereof and describes the type of
interest therein held by such Credit Party and, in each of the cases described
in clauses (i) and (ii) of this Section 4.13(b)(i), whether any lease requires
the consent of the landlord or tenant thereunder, or other party thereto, to
the transactions.  Each agreement listed
of the type described in clause (B) of the immediately preceding sentence is in
full force and effect and none of the Credit Parties has knowledge of any
default that has occurred and is continuing thereunder, and each such agreement
constitutes the legally valid and binding obligation of each applicable Credit
Party, enforceable against such Credit Party in accordance with its terms, except
as enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors’ rights generally
or by equitable principles.

(ii)     No Mortgaged Property is located in an area
that has been identified by the Secretary of Housing and Urban Development as
an area having special flood hazards and in which flood insurance has been made
available under the National Flood Insurance Act of 1968.

(iii)    No portion of any Real Estate Asset of any
Credit Party or any of its Subsidiaries has suffered any material damage by
fire or other casualty loss that has not heretofore been completely repaired
and restored to its original condition. 
No portion of any Real Estate Asset of any Credit Party or any of its
Subsidiaries is located in a special flood hazard area as designated by any
federal Governmental Authority.

4.14         Environmental Matters.  Neither the Borrower nor any of its
Subsidiaries nor any of their respective Facilities or operations are subject
to any outstanding written order, consent decree or settlement agreement with
any Person relating to any Environmental Law, any Environmental Claim, or any
Hazardous Materials Activity that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.  Neither the Borrower nor any of its
Subsidiaries has received any letter or request for information under Section 104
of the Comprehensive Environmental Response, Compensation, and Liability Act
(42 U.S.C. § 9604) or any comparable state law.  There are and, to each of the Borrower’s and
its Subsidiaries’ knowledge, have been, no conditions, occurrences, or
Hazardous Materials Activities which could reasonably be expected to form the
basis of an Environmental Claim against the Borrower or any of its Subsidiaries
that, individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.  Neither the
Borrower nor any of its Subsidiaries nor, to any Credit Party’s knowledge, any
predecessor of the Borrower or any of its Subsidiaries has filed any notice
under any Environmental Law indicating past or present treatment of Hazardous
Materials at any Facility, and none of the Borrower’s or any of its
Subsidiaries’ operations involves the generation, transportation, treatment,
storage or disposal of hazardous waste, as defined under 40 C.F.R. Parts 260-270
or any state equivalent.  Compliance with
all current or reasonably foreseeable future requirements pursuant to or under
Environmental Laws could not be reasonably expected to have, individually or in
the aggregate, a Material Adverse Effect. 
No event or condition has occurred or is occurring with respect to the
Borrower or any of its Subsidiaries relating to any Environmental Law, any
Release of Hazardous Materials, or any Hazardous Materials Activity which
individually or in the aggregate has, or could reasonably be expected to have,
a Material Adverse Effect.

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4.15         No Defaults.  Neither the Borrower nor any of its
Subsidiaries is in default in the performance, observance or fulfillment of any
of the obligations, covenants or conditions contained in any of its Contractual
Obligations, and no condition exists which, with the giving of notice or the
lapse of time or both, could constitute such a default, except where the
consequences, direct or indirect, of such default or defaults, if any, could
not reasonably be expected to have a Material Adverse Effect.

4.16         Governmental Regulation.  Neither the Borrower nor any of its
Subsidiaries is a “registered investment company” or a company “controlled” by
a “registered investment company” or a “principal underwriter” of a “registered
investment company” as such terms are defined in the Investment Company Act of
1940.

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

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

4.19         ERISA Matters.  The Borrower, each of its Subsidiaries and
each of their respective ERISA Affiliates are in compliance with all applicable
provisions and requirements of ERISA and the Internal Revenue Code and the
regulations and published interpretations thereunder with respect to each Employee
Benefit Plan, and have performed all their obligations under each Employee
Benefit Plan.  Each Employee Benefit Plan
which is intended to qualify under Section 401(a) of the Internal Revenue Code
has received a favorable determination letter from the Internal Revenue Service
indicating that such Employee Benefit Plan is so qualified and nothing has
occurred subsequent to the issuance of such determination letter which would
cause such Employee Benefit Plan to lose its qualified status.  No liability to the PBGC (other than required
premium payments), the Internal Revenue Service, any Employee Benefit Plan or
any trust established under Title IV of ERISA has been or is expected to be
incurred by the Borrower, any of its Subsidiaries or any of their ERISA
Affiliates.  No ERISA Event has occurred
or is reasonably expected to occur. 
Except to the extent required under Section 4980B of the Internal
Revenue Code or similar state laws, no Employee Benefit Plan provides health or
welfare benefits (through the purchase of insurance or otherwise) for any
retired or former employee of the Borrower, any of its Subsidiaries or any of
their respective ERISA Affiliates.  The
present value of the aggregate benefit liabilities under each Pension Plan
sponsored, maintained or contributed to by the Borrower, any of its
Subsidiaries or any of their ERISA Affiliates (determined as of the end of the
most recent plan year on the basis of the actuarial assumptions specified for
funding purposes in the most recent actuarial valuation for such Pension Plan),
did not exceed the aggregate current value of the assets of such Pension
Plan.  As of the most 

 78
 

recent valuation date for each Multiemployer
Plan for which the actuarial report is available, the potential liability of
the Borrower, its Subsidiaries and their respective ERISA Affiliates for a
complete withdrawal from such Multiemployer Plan (within the meaning of Section
4203 of ERISA), when aggregated with such potential liability for a complete
withdrawal from all Multiemployer Plans, based on information available
pursuant to Section 4221(e) of ERISA is zero. 
The Borrower, each of its Subsidiaries and each of their ERISA
Affiliates have complied with the requirements of Section 515 of ERISA with respect
to each Multiemployer Plan and are not in material “default” (as defined in
Section 4219(c)(5) of ERISA) with respect to payments to a Multiemployer Plan.

4.20         Solvency.  The Credit Parties (on a consolidated basis)
are and, upon the incurrence of any Obligation by the Credit Parties on any
date on which this representation and warranty is made, will be Solvent.

4.21         Intellectual Property.  The Borrower and its Subsidiaries own or
license or otherwise have the right to use all licenses, permits, patents,
patent applications, trademarks, trademark applications, service marks, trade
names, copyrights, copyright applications, Internet domain names, franchises,
authorizations and other intellectual property rights (including all
Intellectual Property) that are used in the operations of their respective
businesses, without infringement upon or conflict with the rights of any other
Person with respect thereto, including all trade names associated with any
private label brands of the Borrower or its Subsidiaries except, in each case,
as will not have a Material Adverse Effect. 
To the knowledge of the Borrower, no license, permit, patent, patent
application, trademark, trademark application, service mark, trade name,
copyright, copyright application, Internet domain name, franchise,
authorization, other intellectual property right (including all Intellectual
Property), slogan or other advertising device, product, process, method,
substance, part or component, or other material now employed, or now
contemplated to be employed, by the Borrower or any of its Subsidiaries
infringes upon or conflicts with any rights owned by any other Person, no claim
or litigation regarding any of the foregoing is pending or threatened and,
there is no infringement by third parties of any of the foregoing except, in
each case, as will not have a Material Adverse Effect.

4.22         Status as Senior Debt.  The Loans and other Obligations of the
Borrower constitute senior Indebtedness of the Borrower ranking at least pari passu in right of payment with all
other unsecured Indebtedness of the Borrower.

4.23         Disclosure.  The confidential information memorandum dated
June 2007 and all other information prepared or furnished by or on behalf
of the Borrower in connection with this Agreement or the consummation of the
transactions contemplated hereunder and thereunder taken as a whole, is complete
and correct in all material respects and does not contain any untrue statement
of a material fact or omit to state a material fact necessary in order to make
the statements contained therein or herein not misleading in light of the
circumstances in which the same were made. 
All financial projections, if any, that have been be prepared in good
faith based upon assumptions believed to be reasonable at the time made and
furnished to the Lead Arranger, it being understood that actual results may
vary materially from financial projections.

4.24         Use of Proceeds.  The proceeds of the Loans and the Letters of
Credit are being used by the Borrower (and, to the extent distributed to them
by any Borrower, each other Credit Party) solely for working capital and general
corporate purposes, including financing the transactions contemplated by the
Acquisition Agreement, Permitted Acquisitions and other Investments permitted hereunder.

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4.25         Perfection of Security Interests.

(a)           Pledge and Security Agreement.  The Pledge and Security Agreement is
effective to create in favor of the Collateral Agent for the benefit of the
Secured Parties, legal, valid and enforceable Liens on, and security interests
in, the Pledge and Security Agreement Collateral and, when (i) financing
statements and other filings in appropriate form are filed in the offices
specified on Schedule 7 to the Perfection Certificate and
(ii) upon the taking of possession or control by the Collateral Agent of
the Pledge and Security Agreement Collateral with respect to which a security
interest may be perfected only by possession or control (which possession or
control shall be given to the Collateral Agent to the extent possession or
control by the Collateral Agent is required by each Pledge and Security
Agreement), the Liens created by the Pledge and Security Agreement shall
constitute fully perfected Liens on, and security interests in, all right,
title and interest of the grantors in the Pledge and Security Agreement
Collateral (other than such Pledge and Security Agreement Collateral in which a
security interest cannot be perfected under the UCC as in effect at the
relevant time in the relevant jurisdiction), in each case subject to no Liens
other than Permitted Liens.

(b)           PTO
Filing; Copyright Office Filing. 
When the Pledge and Security Agreement or a short form thereof is filed
in the United States Patent and Trademark Office and the United States Copyright
Office, the Liens created by such Pledge and Security Agreement shall
constitute fully perfected Liens on, and security interests in, all right,
title and interest of the grantors thereunder in Patents (as defined in the
Pledge and Security Agreement) registered or applied for with the United States
Patent and Trademark Office or Copyrights (as defined in such Pledge and
Security Agreement) registered or applied for with the United States Copyright
Office, as the case may be, in each case subject to no Liens other than Permitted
Liens.

(c)           Mortgages.  Each Mortgage is effective to create, in
favor of the Collateral Agent, for its benefit and the benefit of the Secured
Parties, legal, valid and enforceable Second Priority Liens on, and security
interests in, all of the Credit Parties’ right, title and interest in and to
the Mortgaged Properties thereunder and the proceeds thereof, subject only to
Permitted Liens or other Liens acceptable to the Collateral Agent, and when the
Mortgages are filed in the offices specified on Schedule 8(a) to
the Perfection Certificate dated the Closing Date (or, in the case of any
Mortgage executed and delivered after the date thereof in accordance with the
provisions of Sections 5.11 and 5.12, when such Mortgage is filed in the
offices specified in the local counsel opinion delivered with respect thereto
in accordance with the provisions of Sections 5.11 and 5.12), the
Mortgages shall constitute fully perfected Liens on, and security interests in,
all right, title and interest of the Credit Parties in the Mortgaged Properties
and the proceeds thereof, in each case prior and superior in right to any other
person, other than Liens permitted by such Mortgage.

(d)           Valid
Liens.  Each Collateral Document
delivered pursuant to Sections 5.11 and 5.12 will, upon execution and
delivery thereof, be effective to create in favor of the Collateral Agent, for
the benefit of the Secured Parties, legal, valid and enforceable Liens on, and
security interests in, all of the Credit Parties’ right, title and interest in
and to the Collateral thereunder, and (i) when all appropriate filings or
recordings are made in the appropriate offices as may be required under
applicable law and (ii) upon the taking of possession or control by the
Collateral Agent of such Collateral with respect to which a security interest
may be perfected only by possession or control (which possession or control
shall be given to the Collateral Agent to the extent required by any Collateral
Document), such Collateral Document will constitute fully perfected Liens on,
and security interests in, all right, title and interest of the Credit Parties
in such Collateral, in each case subject to no Liens other than the applicable
Permitted Liens.

4.26         Purchase Documents; Representations and
Warranties in Acquisition Agreement.  The Lenders have been furnished true and
complete copies of the Acquisition Agreement and each other document listed on Schedule
4.26.  All representations and
warranties of the Borrower and its Subsidiaries 

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set forth in the Acquisition Agreement were true and correct in all
material respects as of the time such representations and warranties were made
and shall be true and correct in all material respects as of the Closing Date
as if such representations and warranties were made on and as of such date,
unless stated to relate to a specific earlier date, in which case such
representations and warranties shall be true and correct in all material respects
as of such earlier date.

4.27         Anti-Terrorism Law

(a)           No Credit Party and, to the knowledge of the Credit
Parties, none of its Affiliates is in violation of any requirement of law
relating to terrorism or money laundering (“Anti-Terrorism
Laws”), including Executive Order No. 13224 on Terrorist
Financing, effective September 24, 2001 (the “Executive
Order”), and the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public
Law 107-56.

(b)           No
Credit Party and to the knowledge of the Credit Parties, no Affiliate or broker
or other agent of any Credit Party acting or benefiting in any capacity in
connection with the Loans is any of the following:

(i)            a
person that is listed in the annex to, or is otherwise subject to the provisions
of, the Executive Order;

(ii)           a
person owned or controlled by, or acting for or on behalf of, any person that
is listed in the annex to, or is otherwise subject to the provisions of, the
Executive Order;

(iii)          a
person with which any Lender is prohibited from dealing or otherwise engaging
in any transaction by any Anti-Terrorism Law;

(iv)          a
person that commits, threatens or conspires to commit or supports “terrorism”
as defined in the Executive Order; or

(v)           a
person that is named as a “specially designated national and blocked person” on
the most current list published by the U.S. Treasury Department Office of
Foreign Assets Control (“OFAC”) at
its official website or any replacement website or other replacement official
publication of such list.

(c)           No Credit Party and, to the knowledge of the Credit
Parties, no broker or other agent of any Credit Party acting in any capacity in
connection with the Loans (i) conducts any business or engages in making
or receiving any contribution of funds, goods or services to or for the benefit
of any person described in paragraph (b) above, (ii) deals in, or
otherwise engages in any transaction relating to, any property or interests in
property blocked pursuant to the Executive Order, or (iii) engages in or
conspires to engage in any transaction that evades or avoids, or has the
purpose of evading or avoiding, or attempts to violate, any of the prohibitions
set forth in any Anti-Terrorism Law.

SECTION
5.                                      AFFIRMATIVE
COVENANTS

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

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5.1            Financial Statements and Other
Reports.  The
Borrower will deliver to the Administrative Agent and the Lenders:

(a)           Quarterly Financial Statements.  Within 45 days after the end of each of the
first three Fiscal Quarters of each Fiscal Year (or such earlier date on which
the Borrower is required to file a Form 10-Q under the Exchange Act), the
consolidated balance sheets of the Borrower and its Subsidiaries as at the end
of such Fiscal Quarter and the related consolidated statements of income,
stockholders’ equity and cash flows of the Borrower and its Subsidiaries for
such Fiscal Quarter and for the period from the beginning of the then current
Fiscal Year to the end of such Fiscal Quarter, setting forth in each case in
comparative form the corresponding figures for the corresponding periods of the
previous Fiscal Year, all in reasonable detail, together with a Financial
Officer Certification and a Narrative Report with respect thereto (it being
understood that the information required by clause (a) may be furnished in the
form of a Form 10-Q);

(b)           Annual Financial Statements.  Within 90 days after the end of each Fiscal
Year (or such earlier date on which the Borrower is required to file a Form
10-K under the Exchange Act), (i) the consolidated balance sheets of the
Borrower and its Subsidiaries as at the end of such Fiscal Year and the related
consolidated statements of income, stockholders’ equity and cash flows of the
Borrower and its Subsidiaries for such Fiscal Year, setting forth in each case
in comparative form the corresponding figures for the previous Fiscal Year, in
reasonable detail, together with a Financial Officer Certification and a
Narrative Report with respect thereto; and (ii) with respect to such
consolidated financial statements a report thereon of the Borrower’s Accountants
and (which report shall be unqualified as to going concern and scope of audit,
and shall state that such consolidated financial statements fairly present, in
all material respects, the consolidated financial position of the Borrower and
its Subsidiaries as at the dates indicated and the results of their operations
and their cash flows for the periods indicated in conformity with GAAP applied
on a basis consistent with prior years (except as otherwise disclosed in such
financial statements) and that the examination by such accountants in
connection with such consolidated financial statements has been made in
accordance with generally accepted auditing standards) (it being understood
that the information required by clause (b) may be furnished in the form of a
Form 10-K);

(c)           Compliance Certificate.  Together with each delivery of financial
statements of the Borrower and its Subsidiaries pursuant to Sections 5.1(a) and
5.1(b), a duly executed and completed Compliance Certificate;

(d)           Statements of Reconciliation After Change in Accounting
Principles.  If, as a result of any
change in accounting principles and policies from those used in the preparation
of the Historical Financial Statements, the consolidated financial statements
of the Borrower and its Subsidiaries delivered pursuant to Section 5.1(a) or
5.1(b) will differ in any material respect from the consolidated financial
statements that would have been delivered pursuant to such subdivisions had no
such change in accounting principles and policies been made, then, together
with the first delivery of such financial statements after such change, one or
more statements of reconciliation for all such prior financial statements in
form and substance satisfactory to the Administrative Agent;

(e)           Notice of Default. 
Promptly upon any Authorized Officer of the Borrower obtaining knowledge
(i) of any condition or event that constitutes a Default or an Event of Default
or that notice has been given to the Borrower with respect thereto;
(ii) that any Person has given any notice to the Borrower or any of its
Subsidiaries or taken any other action with respect to any event or condition
set forth in Section 8.1(b); or (iii) of the occurrence of any event or change
that 

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has caused or
evidences, either in any case or in the aggregate, a Material Adverse Effect, a
certificate of its Authorized Officer specifying the nature and period of
existence of such Material Adverse Effect or Default or Event of Default and
what action the Borrower has taken, is taking and proposes to take with respect
thereto;

(f)            Notice of Litigation.  Promptly upon any Authorized Officer of the
Borrower obtaining knowledge of (i) the institution of, or non-frivolous
threat of, any Adverse Proceeding not previously disclosed in writing by the
Borrower to Lenders, or (ii) any material development in any Adverse Proceeding
that, in the case of either clause (i) or (ii), if adversely determined could
be reasonably expected to have a Material Adverse Effect, or seeks to enjoin or
otherwise prevent the consummation of, or to recover any damages or obtain
relief as a result of, the transactions contemplated hereby, written notice
thereof together with such other information as may be reasonably available to
the Borrower to enable Lenders and their counsel to evaluate such matters;

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

(h)           Financial Plan. 
As soon as practicable and in any event no later than sixty days after
the end of each Fiscal Year, a consolidated plan and financial forecast for
such Fiscal Year as approved by the board of directors of the Borrower (such
approval to occur within sixty days after the end of such Fiscal Year) and each
Fiscal Year (or portion thereof) thereafter through the Revolving Commitment
Termination Date (a “Financial Plan”),
including (i) a forecasted consolidated balance sheet and forecasted
consolidated statements of income and cash flows of the Borrower and its
Subsidiaries for each such Fiscal Year, together with pro forma Compliance
Certificates for each such Fiscal Year and an explanation of the assumptions on
which such forecasts are based,  (ii) forecasted
consolidated statements of income and cash flows of the Borrower and its
Subsidiaries for each month of each such Fiscal Year and (iii) forecasts
demonstrating adequate liquidity through the Revolving Commitment Termination
Date without giving effect to any additional debt or equity offerings not
reflected in the Projections, together, in each case, with an explanation of
the assumptions on which such forecasts are based all in form and substance
reasonably satisfactory to the Administrative Agent;

(i)            Insurance Report. 
As soon as practicable and in any event by the last day of each Fiscal
Year, a report in form and substance satisfactory to the Administrative Agent
outlining all material insurance coverage maintained as of the date of such
report by the Borrower and its Subsidiaries and all material insurance coverage
planned to be maintained by the Borrower and its Subsidiaries in the
immediately succeeding Fiscal Year;

(j)            [Reserved];

 83
 

(k)           Notice Regarding Yucaipa Management Agreement.  Promptly, and in any event within ten
Business Days, the Yucaipa Management Agreement is terminated or amended in a
manner that is materially adverse to the Borrower or such Subsidiary, as the
case may be;

(l)            Environmental Reports and Audits.

(i)      As
soon as practicable following receipt thereof, copies of all environmental audits,
investigations, analyses and reports of any kind or character, whether prepared
by personnel of the Borrower or any of its Subsidiaries or by independent
consultants, Governmental Authorities or any other Persons, with respect to
significant environmental matters at any Real Estate Asset or with respect to
any material Environmental Claims;

(ii)     Promptly
upon the occurrence thereof, written notice describing in reasonable detail (1)
any Release required to be reported to any federal, state or local governmental
or regulatory agency under any applicable Environmental Laws, (2) any remedial
action taken by the Borrower or any other Person in response to (A) any
Hazardous Materials Activities the existence of which has a reasonable
possibility of resulting in one or more Environmental Claims having, individually
or in the aggregate, a Material Adverse Effect, or (B) any Environmental Claims
that, individually or in the aggregate, have a reasonable possibility of
resulting in a Material Adverse Effect, and (3) any Credit Party’s discovery of
any occurrence or condition on any real property adjoining or in the vicinity
of any Facility that are reasonably likely to cause such Facility or any part
thereof to be subject to any material restrictions on the ownership, occupancy,
transferability or use thereof under any Environmental Laws;

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

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

(v)     With
reasonable promptness, such other documents and information as from time to
time may be reasonably requested by the Administrative Agent in relation to any
matters disclosed pursuant to this Section 5.1(l);

(m)          Information Regarding Collateral.  The Borrower will furnish to the Collateral
Agent prompt written notice of any change (i) in any Credit Party’s corporate
name, (ii) in any Credit Party’s identity or corporate structure or (iii) in
any Credit Party’s Federal Taxpayer Identification Number.  The Borrower agrees not to effect or permit
any change referred to in the preceding 

 84
 

sentence
unless all filings have been made under the Uniform Commercial Code or otherwise
that are required in order for the Collateral Agent to continue at all times
following such change to have a valid, legal and perfected security interest in
all the Collateral and for the Collateral at all times following such change to
have a valid, legal and perfected security interest as contemplated by the
Collateral Documents.  The Borrower also
agrees promptly to notify Collateral Agent if any material portion of the
Collateral is damaged or destroyed;

(n)           Annual Collateral Verification.  Each year, at the time of delivery of annual
financial statements with respect to the preceding Fiscal Year pursuant to
Section 5.1(b), the Borrower shall deliver to Collateral Agent a certificate of
its Authorized Officer (i) either confirming that there has been no change in
such information since the date of the Perfection Certificate delivered on the
Closing Date or the date of the most recent certificate delivered pursuant to
this Section and/or identifying such changes (ii) certifying that all Uniform
Commercial Code financing statements (including fixtures filings, as
applicable) or other appropriate filings, recordings or registrations, have
been filed of record in each governmental, municipal or other appropriate office
in each jurisdiction identified pursuant to clause (i) above to the extent necessary
to protect and perfect the security interests under the Collateral Documents
for a period of not less than 18 months after the date of such certificate
(except as noted therein with respect to any continuation statements to be
filed within such period);

(o)           Borrowing Base Determination.  The Borrower shall deliver, as soon as
available and in any event not later than fifteen (15) days after the end of
each fiscal month, a Borrowing Base Certificate as of the end of such fiscal
month executed by a Authorized Officer of the Borrower.  During a Liquidity Event Period, the Borrower
shall deliver, as soon as available and in any event not later than three (3)
Business Days after the end of the last day of each week, an additional
Borrowing Base Certificate as of the end of such period executed by an
Authorized Officer of the Borrower;

(p)           Collateral Reporting.  Provide the Administrative Agent (and if so
requested by the Administrative Agent, with copies for each Lender) with
documents and information with respect to Collateral as the Administrative
Agent may request in its Permitted Discretion;

(q)           Other Information. 
(i) Promptly upon their becoming available, copies of (A) all
financial statements, reports, notices and proxy statements sent or made available
generally by the Borrower to its security holders acting in such capacity or by
any Subsidiary of the Borrower to its security holders other than the Borrower
or another Subsidiary of the Borrower, (B) all regular and periodic reports
and all registration statements and prospectuses, if any, filed by the Borrower
or any of its Subsidiaries with any securities exchange or with the Securities
and Exchange Commission or any governmental or private regulatory authority,
(C) all press releases and other statements made available generally by the
Borrower or any of its Subsidiaries to the public concerning material
developments in the business of the Borrower or any of its Subsidiaries, and
(D) to the extent not otherwise delivered to the Administrative Agent or the
Lenders pursuant to this Agreement or the other Credit Documents, copies of all
financial statements, reports and notices delivered to (1) the Term Loan
Administrative Agent, the Term Loan Collateral Agent or any other Term Loan
Secured Party pursuant to the Term Loan Credit Documents and (2) the administrative
agent under the Bridge Loan Agreement and (ii) such other information and data
with respect to the Borrower or any of its Subsidiaries as from time to time
may be reasonably requested by the Administrative Agent, the Collateral Agent
or any Lender; and

(r)            Certification of Public Information.  For so long as the Borrower or any of its
Subsidiaries are subject to the reporting requirements of the Securities Act or
the Exchange Act, 

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concurrently
with the delivery of any document or notice required to be delivered pursuant
to this Section 5.1, the Borrower shall indicate in writing whether such
document or notice contains Nonpublic Information.  For so long as the Borrower or any of its
Subsidiaries are subject to the reporting requirements of the Securities Act or
the Exchange Act, any document or notice required to be delivered pursuant to
this Section 5.1 shall be deemed to contain Nonpublic Information unless the
Borrower specifies otherwise.  The
Borrower and each Lender acknowledge that certain of the Lenders may be “public-side”
Lenders (Lenders that do not wish to receive material non-public information
with respect to the Borrower, its Subsidiaries or their securities) and, if
documents or notices required to be delivered pursuant to this Section 5.1 or
otherwise are being distributed through the Platform, any document or notice
which contains Nonpublic Information (or is deemed to contain Nonpublic
Information) shall not be posted on that portion of the Platform designated for
such public side Lenders.

5.2            Existence.  Except as otherwise permitted under Section
6.8, each Credit Party will, and will cause each of its Subsidiaries to, at all
times preserve and keep in full force and effect its existence and all rights
and franchises, licenses and permits material to its business; provided,
no Credit Party or any of its Subsidiaries shall be required to preserve any
such existence, right or franchise, licenses and permits if such Person’s board
of directors (or similar governing body) shall determine that the preservation
thereof is no longer desirable in the conduct of the business of such Person,
and that the loss thereof is not disadvantageous in any material respect to
such Person or to Lenders.

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

5.4            Maintenance of Properties.  Each Credit Party will, and will cause each
of its Subsidiaries to, maintain or cause to be maintained in good repair,
working order and condition, ordinary wear and tear excepted, all material
properties used or useful in the business of the Borrower and its Subsidiaries
and from time to time will make or cause to be made all appropriate repairs,
renewals and replacements thereof.

5.5            Insurance.  The Borrower will maintain or cause to be
maintained, with financially sound and reputable insurers, such public
liability insurance, third party property damage insurance, business
interruption insurance and casualty insurance with respect to liabilities,
losses or damage in respect of the assets, properties and businesses of the
Borrower and its Subsidiaries as may customarily be carried or maintained under
similar circumstances by Persons of established reputation engaged in similar
businesses, in each case in such amounts (giving effect to self-insurance),
with such deductibles, covering such risks and otherwise on such terms and
conditions as shall be customary for such Persons.  Without limiting the generality of the
foregoing, the Borrower will maintain or cause to be maintained (a) flood insurance
with respect to each Flood Hazard Property that is located in a community that
participates in the National Flood Insurance Program, in each case in
compliance with any applicable regulations of the 

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Board of Governors of the Federal Reserve System, and
(b) replacement value casualty insurance on the Collateral under such policies
of insurance, with such insurance companies, in such amounts, with such
deductibles, and covering such risks as are at all times carried or maintained
under similar circumstances by Persons of established reputation engaged in
similar businesses.  Each such policy of
insurance shall (i) name Collateral Agent, on behalf of Secured Parties as an
additional insured thereunder as its interests may appear and (ii) in the case
of each casualty insurance policy, contain a loss payable clause or
endorsement, satisfactory in form and substance to the Collateral Agent, that
names the Collateral Agent, on behalf of Lenders, as the loss payee thereunder
and provides for at least thirty days’ prior written notice to the Collateral
Agent of any modification or cancellation of such policy.

5.6            Inspections.  Each Credit Party will, and will cause each
of its Subsidiaries to, permit any authorized representatives designated by any
Agent or any Lender, or any agents or representatives thereof, to visit and
inspect any of the properties of any Credit Party and any of its Subsidiaries,
to (a) inspect, copy and take extracts from its and their financial and
accounting records and (b) discuss its and their affairs, finances and accounts
with its and their respective officers and directors, all upon reasonable
notice (except that during the continuance of an Event of Default, no such
notice shall be required) and at such reasonable times during normal business
hours and as often as may reasonably be requested.  The Borrower shall authorize its certified
public accountants (including the Borrower’s Accountants), and shall cause the
certified public accountants of any other Subsidiary of the Borrower, if any,
to disclose to the Agents or any Lender any and all financial statements and
other information of any kind, as any such Agent or any Lender reasonably
requests and that such accountants may have with respect to the business,
financial condition, results of operations or other affairs of the Borrower or
any other Subsidiary of the Borrower.

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

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

5.9            Field Examinations; Collateral
Appraisals.

(a)           The Administrative Agent may conduct, or shall cause to be
conducted, at Borrower’s expense and upon notice by the Administrative Agent,
two collateral appraisals and four field examinations per fiscal year for the
purpose of determining the Borrowing Base, all upon notice and at such times
during normal business hours and as often as may be reasonably requested.  The Borrower shall furnish to the
Administrative Agent any information that the Administrative Agent may
reasonably request regarding the determination and calculation of the Borrowing
Base including correct and complete copies of any invoices, underlying agreements,
instruments or other documents and the identity of all Account Debtors in
respect of Accounts referred to therein.

(b)           The Administrative Agent may, at the Borrower’s sole cost
and expense, make test verifications of the Accounts and physical verifications
of the Inventory in any manner and through any medium that the Administrative
Agent considers advisable, and the Borrower shall furnish all such assistance
and information as the Administrative Agent may require in connection
therewith.  At any time and from time to
time, upon the Administrative Agent’s request and at the expense of the
Borrower, the Borrower 

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shall cause independent public accountants or
others satisfactory to the Administrative Agent to furnish to the Administrative
Agent reports showing reconciliations, aging and test verifications of, and
trial balances for, the Accounts.

5.10         Environmental Matters; Hazardous
Activities, etc. 
Each Credit Party shall promptly take, and shall cause each of its
Subsidiaries promptly to take, any and all actions necessary to (i) cure any
material violation of applicable Environmental Laws by such Credit Party or its
Subsidiaries and (ii) make an appropriate response to any material
Environmental Claim against such Credit Party or any of its Subsidiaries and
discharge any obligations it may have to any Person thereunder.

5.11         Subsidiaries.  In the event that any Person becomes a
Domestic Subsidiary of the Borrower, the Borrower shall (a) promptly (within 30
days or such later date as the Administrative Agent may agree in its sole
discretion), cause such Domestic Subsidiary (other than any Immaterial
Subsidiary) to become a Guarantor hereunder and a Grantor under the Pledge and
Security Agreement by executing and delivering to the Administrative Agent and
the Collateral Agent a Counterpart Agreement, and (b) take all such actions and
execute and deliver, or cause to be executed and delivered, Environmental Reports
(to the extent required by the Collateral Agent) and all such documents,
instruments, agreements, and certificates as are similar to those described in
Sections 3.1(b), 3.1(h) and 3.1(i). In the event that any Person becomes a
Foreign Subsidiary of the Borrower, and the ownership interests of such Foreign
Subsidiary are owned by any Borrower or by any Guarantor, the Borrower shall,
or shall cause such Guarantor to, deliver, all such documents, instruments,
agreements, and certificates as are similar to those described in Sections
3.1(b), and the Borrower shall take, or shall cause such Guarantor to take, all
of the actions referred to in Section 3.1(i) that are necessary to grant and to
perfect a First Priority Lien (in the case of the Current Asset Collateral) and
Second Priority Lien (in the case of the Fixed Asset Collateral) in favor of
Collateral Agent, for the benefit of Secured Parties, under and to the extent
required by the Pledge and Security Agreement in such ownership interests,
subject to the Intercreditor Agreement. 
With respect to each such Subsidiary, the Borrower shall promptly
(within 30 days or such later date as the Administrative Agent may agree in its
sole discretion) send to the Administrative Agent written notice setting forth
with respect to such Person (i) the date on which such Person became a
Subsidiary of the Borrower, and (ii) all of the data required to be set
forth in Schedules 4.1 and 4.2 with respect to all Subsidiaries
of the Borrower; provided, such written notice shall be deemed to
supplement Schedules 4.1 and 4.2 for all purposes hereof.

5.12         Additional Material Real Estate Assets.  In the event that any Credit Party owns or
acquires a Material Real Estate Asset and such interest has not otherwise been
made subject to the Lien of the Collateral Documents in favor of Collateral
Agent, for the benefit of Secured Parties, then such Credit Party shall
promptly take all such actions and execute and deliver, or cause to be executed
and delivered, all such mortgages, documents, instruments, agreements, opinions
and certificates similar to those described in Sections 3.1(h) and 3.1(i) with
respect to each such Material Real Estate Asset (each, an “After-Acquired Mortgaged Property”)  that Collateral Agent shall reasonably
request to create in favor of Collateral Agent, for the benefit of Secured Parties,
a valid and, subject to any filing and/or recording referred to herein,
perfected Second Priority security interest in such Material Real Estate Assets
subject to the Intercreditor Agreement. 
In the event that the existing mortgage in favor of Wachovia Bank N.A.
or its Affiliates encumbering the property at 4250 Coral Ridge Dr., Coral
Springs, Florida is released more than six months prior to the Revolving Commitment
Termination Date, the Borrower covenants to cause to be granted in favor the
Collateral Agent, for the benefit of the Secured Parties a mortgage with
respect to such property and to cause to be executed and delivered within 30
days of such event all such mortgages, documents, instruments, agreements, opinions
and certificates similar to those described in Section 3.1(h) with respect to
such property. In addition to the foregoing, the Borrower shall, at the request
of the Collateral Agent or the Requisite Lenders, deliver, from time to time,
to the Administrative Agent such 

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appraisals as are required by law or regulation of
Real Estate Assets with respect to which Collateral Agent has been granted a
Lien.

5.13         Further Assurances.  At any time or from time to time upon the
request of the Administrative Agent, each Credit Party will, at its expense,
promptly execute, acknowledge and deliver such further documents and do such
other acts and things as the Administrative Agent or the Collateral Agent may
reasonably request in order to effect fully the purposes of the Credit Documents.  In furtherance and not in limitation of the
foregoing, each Credit Party shall take such actions as the Administrative
Agent or the Collateral Agent may reasonably request from time to time to
ensure that the Obligations are guarantied by the Guarantors and are secured by
substantially all of the assets of the Borrower and its Subsidiaries and by all
of the outstanding Capital Stock of the Borrower and the other Subsidiaries (subject
to limitations contained in the Credit Documents with respect to Foreign
Subsidiaries).

5.14         Books.  Each Credit Party shall keep proper Books in
which full and correct entries shall be made in conformity with GAAP of all
financial transactions and the assets and business of the Borrower and each
Subsidiary.

5.15         Cash Management.

(a)           Approved Deposit Accounts.

(i)      Within thirty (30) days after the Closing
Date (provided that in the case of Enthusiast Media and its
Subsidiaries, such time period shall be within ninety (90) days after the Closing
Date) (or such longer period as the Agents may agree), Borrower shall and shall
cause each of its Subsidiaries to (i) establish and maintain cash
management services of a type and on terms satisfactory to the Administrative
Agent, and shall request in writing and otherwise take such reasonable steps to
ensure that all of their and their Subsidiaries’ Account Debtors forward
payment of the amounts owed by them directly to such accounts, or to Borrower
for deposit in accordance with Section 5.15(a)(ii), and (ii) deposit or cause
to be deposited promptly, and in any event no later than the first Business Day
after the date of receipt thereof, all of their Collections (including those
sent directly by their Account Debtors to an Approved Deposit Account) into an
Approved Deposit Account listed on Schedule 5.15(a) (such schedule to be
delivered to the Administrative Agent on or before the thirtieth (30th) day (or 90th day in the case of Enthusiast Media and its
Subsidiaries) after the Closing Date or such later date as the Administrative Agent
may agree in its sole discretion). 
Within thirty (30) days after the Closing Date (provided that in the
case of Enthusiast Media and its Subsidiaries, such time period shall be within
ninety (90) days after the Closing Date) (or such longer period as the Agents
may agree), Borrower shall and shall cause each other Credit Party to enter
into a Deposit Account Control Agreement, reasonably satisfactory to the
Administrative Agent, with respect to each Approved Deposit Account listed on Schedule
5.15(a).  The Approved Deposit Accounts
shall be cash collateral accounts, with all cash, checks and similar items of
payment in such accounts securing payment of the Obligations, and in which
Borrower hereby grants a First Priority Lien to Collateral Agent.  So long as no Liquidity Event Period has occurred and
is continuing, the Credit Parties may direct, and shall have sole control over,
the manner of disposition of funds in the an Approved Deposit Accounts.

(ii)     The Credit Parties may not establish or
maintain any Deposit Account (other than Closed Accounts) other than with a
Deposit Account Bank; provided, however, that each Credit Party
may (x) maintain payroll, withholding tax and other fiduciary accounts, (y)
maintain an account relating to earnout obligations with minority stockholders
of Automotive.com, and (z) maintain other accounts as long as the aggregate
balance for all such Credit Parties in all such accounts does not exceed
$5,000,000 at any time.

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(iii)    The Credit Parties may close Approved
Deposit Accounts and/or open Approved Deposit Accounts, subject to the
execution and delivery to the Collateral Agent of appropriate Deposit Account
Control Agreements (except with respect to any payroll, trust, and tax
withholding accounts or unless expressly waived by the Collateral Agent)
consistent with the provisions of this Section 5.15 and otherwise reasonably
satisfactory to the Collateral Agent. 
The Credit Parties shall furnish the Collateral Agent with prior written
notice of its intention to open or close an Approved Deposit Account and the
Collateral Agent shall promptly notify the Borrower as to whether the
Collateral Agent shall require a Deposit Account Control Agreement with such
Deposit Account Bank.  In the event (i)
any Credit Party or any Deposit Account Bank shall, after the date hereof,
terminate an agreement with respect to the maintenance of an Approved Deposit
Account for any reason, (ii) any Agent shall demand such termination as a
result of the failure of a Deposit Account Bank to comply with the terms of the
applicable Deposit Account Control Agreement or (iii) any Agent determines in
its sole discretion that the financial condition of a Deposit Account Bank has
materially deteriorated, each Credit Party shall notify all of its respective
obligors that were making payments to such terminated Approved Deposit Account
to make all future payments to another Approved Deposit Account.

(b)           Concentration
Account; Liquidity Event Period.

(i)      Each
Deposit Account Agreement entered into by a Credit Party shall require, after
the occurrence and during the continuance of a Liquidity Event Period (and
delivery of a Blockage Notice thereof from the Collateral Agent), the ACH or
wire transfer on each Business Day of all available cash receipts to the
concentration account maintained by the Administrative Agent at Citibank (the “Concentration Account”) and such amounts in
the Concentration Account shall be applied pursuant to Section 2.13(d).

(ii)     The Concentration Account shall at all
times be under the sole dominion and control of the Collateral Agent.  Each Borrower hereby acknowledges and agrees
that (i) such Borrower has no right of withdrawal from the Concentration
Account, (ii) the funds on deposit in the Concentration Account shall at all
times continue to be collateral security for all of the Obligations, and (iii)
the funds on deposit in the Concentration Account shall be applied as provided
in Section 2.13(d).  In the event that,
notwithstanding the provisions of this Section 5.15, during the continuation of
a Liquidity Event Period, any Borrower receives or otherwise has dominion and
control of any such proceeds or collections, such proceeds and collections
shall be held in trust by such Borrower for the Collateral Agent, shall not be
commingled with any of such Borrower’s other funds or deposited in any account
of such Borrower and shall promptly be deposited into the Concentration Account
or dealt with in such other fashion as such Borrower may be instructed by the
Collateral Agent.

(iii)    Any amounts received in the Concentration
Account at any time when all of the Obligations then due have been and remain
fully repaid shall be remitted to the operating account of the Borrower maintained
with the Administrative Agent.

(iv)    The Collateral Agent shall promptly (but in
any event within two Business Days) furnish written notice to each Deposit
Account Bank any termination of a Liquidity Event Period.

(c)           Securities
Accounts.

(i)      The Credit Parties may not establish or
maintain any Securities Account that is not a Control Account.

(ii)     In the event (A) any Credit Party or any
Approved Securities Intermediary shall, after the date hereof, terminate an
agreement with respect to the maintenance of a Control Account for any reason, 

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(B) any Agent shall demand such termination
as a result of the failure of an Approved Securities Intermediary to comply
with the terms of the applicable Securities Account Control Agreement or (C)
any Agent determines in its sole discretion that the financial condition of an
Approved Securities Intermediary has materially deteriorated, each Credit Party
shall notify all of its obligors that were making payments to such terminated
Securities Account Control Account to make all future payments to another
Securities Account Control Account.

(d)           The requirements of this Section 5.15 shall not apply to
any Foreign Subsidiary.

5.16         Landlord Waivers and Bailee’s Letters.

(a)           Each Credit Party shall use commercially reasonable
efforts to deliver, within sixty (60) days after the Closing Date (or such
later date as shall be acceptable to the Administrative Agent in its sole
discretion), Landlord Access Agreements and Bailee’s Letters with respect to
each premises of a third party listed on Schedule 1.1(g); provided,
that if such documentation is not obtained with respect to any such premises
for so long as a material amount of Collateral included in the Borrowing Base
is located at such premises, the Administrative Agent will impose a Rent Reserve
against such Collateral.

(b)           With respect to any premises of a third party at which any
material amount of Collateral is located that was not used or leased by any
Credit Party on the Closing Date, each Credit Party shall use commercially
reasonable efforts to deliver, within sixty (60) days after the acquisition of
such Leasehold Property or other third party location (or such later date as
shall be acceptable to the Administrative Agent in its sole discretion),
Landlord Access Agreements and Bailee’s Letters with respect to each such premises;
provided, that if such documentation is not obtained with respect to any
such premises on which a Material Contract of Collateral included in the
Borrowing Base is located, the Administrative Agent will impose a Rent Reserve.

5.17         Post Closing Collateral Matters.

(a)           To the extent such items have not been delivered as of the
Closing Date, Borrower shall complete the items contained on Schedule 5.17 to
the satisfaction of the Collateral Agent within the time period specified on
Schedule 5.17.

SECTION
6.                                      NEGATIVE
COVENANTS

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

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

(a)           the Obligations;

(b)           Indebtedness of (i) any Credit Party to any other Credit
Party, (ii) any non-Credit Party to a Credit Party subject to Section
6.6(f)(iv) or (iii) any Credit Party to a non-Credit Party; provided,
(x) in the case of (ii), all such Indebtedness shall be evidenced by promissory
notes and all such notes shall be pledged pursuant to the Pledge and Security
Agreement, and (y) in the case of (ii) all such Indebtedness shall be unsecured
and subordinated in right of payment to the payment 

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in full of the
Obligations pursuant to the terms of any applicable promissory notes or an intercompany
subordination agreement that in any such case, is reasonably satisfactory to
the Administrative Agent;

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

(d)           Indebtedness which may be deemed to exist pursuant to any
guaranties (including in connection with operating lease obligations),
performance, surety, statutory, appeal or similar obligations incurred in the
ordinary course of business;

(e)           Indebtedness in respect of netting services, overdraft
protections and otherwise in connection with Deposit Accounts;

(f)            guaranties in the ordinary course of business of the
obligations of suppliers, customers, franchisees and licensees of the Borrower
and its Subsidiaries;

(g)           guaranties by (i) any Credit Party of Indebtedness of
another Credit Party, (ii) any non-Credit Party of Indebtedness of a
Credit Party or (iii) a Credit Party of Indebtedness of a non-Credit Party
subject to Section 6.6(f)(iv), in each case, with respect to Indebtedness otherwise
permitted to be incurred pursuant to this Section 6.1;

(h)           Indebtedness existing on the Closing Date and described in
Schedule 6.1, but not any extensions, renewals or replacements of
such Indebtedness except any Permitted Refinancing thereof;

(i)            purchase money Indebtedness and Indebtedness with respect
to Capital Leases, in each case, incurred by the Borrower or any Subsidiary to
finance the acquisition of fixed assets, in an aggregate amount not to exceed
$40,000,000 at any time outstanding; provided, that any such
Indebtedness shall be secured only by the assets acquired in connection with
the incurrence of such Indebtedness;

(j)            Indebtedness under the Term Loan Agreement in an
aggregate principal amount not to exceed the sum of (x) $880,000,000, less any
prepayments of Term Loans with the proceeds of Indebtedness permitted by
Section 6.1(m), and (y) so long as the Senior Secured Leverage Ratio does not
exceed the New Term Loan Incurrence Level on a pro forma basis
after giving effect to the incurrence thereof, the aggregate principal amount
of any New Term Loans issued pursuant thereto in an amount not to exceed $200.0
million and subject to the Intercreditor Agreement, any Permitted Refinancings;

(k)           Indebtedness in respect of Swap Contracts permitted or
required by this Agreement and not entered into for speculative purposes;

(l)            Acquired Indebtedness, in an aggregate principal amount
not to exceed $30,000,000 at any time outstanding, together with refinancings
and extensions of any such Indebtedness if the terms and conditions thereof are
not materially less favorable to the obligor thereon or to the Lenders than the
Indebtedness being refinanced or extended, and the average life 

 92
 

to maturity
thereof is greater than or equal to that of the Indebtedness being refinanced
or extended; provided, such Indebtedness shall not (A) be secured by any
assets other than pursuant to Liens permitted by Section 6.2(o) or (B) be
incurred, created or assumed if any Default or Event of Default has occurred
and is continuing or would result therefrom;

(m)          any Credit Party may incur additional Indebtedness; provided that (A) immediately prior to and
after giving effect to such incurrence of Indebtedness no Default has occurred
and is continuing, and (B) the Borrower shall be in compliance with the
Incurrence Test after giving effect to such incurrence of Indebtedness;

(n)           Indebtedness
evidenced by the Bridge Loans and Indebtedness under the Permanent Financing
and, in each case, any Permitted Refinancing thereof; and

(o)           other Indebtedness of the Borrower and its Subsidiaries,
in an aggregate principal amount not to exceed at any time $25,000,000.

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

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

(b)           Liens for Taxes if obligations with respect to such Taxes
are not yet over due or are being contested in good faith by appropriate
actions for which reserves have been established if required by GAAP, which
proceedings (or orders entered in connection with such proceedings) have the
effect of preventing the forfeiture or sale of the property subject to such
Lien;

(c)           statutory Liens of landlords, banks (and rights of set-off),
of carriers, warehousemen, mechanics, repairmen, workmen and materialmen, and
other Liens imposed by law (other than any such Lien imposed pursuant to
Section 401(a)(29) or 412(n) of the Internal Revenue Code or by ERISA), in each
case incurred in the ordinary course of business (i) for amounts not yet
overdue or (ii) for amounts that are overdue and that (in the case of any such
amounts overdue for a period in excess of ten (10) Business days) are not yet
overdue or are being contested in good faith by appropriate proceedings, so
long as such reserves or other appropriate provisions, if any, as shall be
required by GAAP shall have been made for any such contested amounts, which
proceedings (or orders entered in connection with such proceedings) have the effect
of preventing the forfeiture or sale of the property subject to such Lien;

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

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(e)           easements, rights-of-way, restrictions
(including, without limitation, zoning or any other similar law or right)
encroachments, and other minor defects or irregularities in title, in each case
which do not and will not (i) secure Indebtedness, (ii) individually or in the
aggregate materially impair the value or marketability of any Real Estate Asset
or (iii) individually or in the aggregate interfere in any material respect
with the ordinary conduct of the business of the Borrower or any of its Subsidiaries;

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

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

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

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

(j)            licenses of patents, trademarks and other intellectual
property rights granted by the Borrower or any of its Subsidiaries in the
ordinary course of business and not interfering in any material respect with
the ordinary conduct of the business of the Borrower and its Subsidiaries;

(k)           Liens described in Schedule 6.2 or, solely
with respect to Mortgaged Properties on a title report, in form and substance
reasonably satisfactory to the Collateral Agent, delivered in connection with
any Mortgaged Property;

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

(m)          Liens securing Indebtedness permitted pursuant to Section
6.1(j), Indebtedness in respect of Cash Management Obligations and Obligations
under Hedge Agreements permitted to be secured by Collateral under and in
accordance with the Term Loan Agreement; provided that such Liens shall
be subject at all times to the terms of the Intercreditor Agreement;

(n)           Liens securing Acquired Indebtedness permitted under
Section 6.1(l); provided that such Lien is as described in the proviso
to the definition of “Acquired Indebtedness”;

(o)           (i) Vendor Liens existing on the Closing Date and (ii)
Vendor Liens arising after the Closing Date which are subject to a Vendor
Intercreditor Agreement; and

(p)           other Liens on assets other than the Current Asset
Collateral securing Indebtedness in an aggregate amount not to exceed
$15,000,000 at any time outstanding;

provided  however, in the case
of any Mortgaged Property, only those Liens described in clauses (a), (b), (c),
(e), (f), (k) and (m) shall be permitted.

6.3            [Reserved]

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6.4            Restricted Junior Payments.  No Credit Party shall, nor shall it permit
any of its Subsidiaries or Affiliates through any manner or means or through
any other Person to, directly or indirectly, declare, order, pay, make or set
apart, or agree to declare, order, pay, make or set apart, any sum for any
Restricted Junior Payment except that:

(a)           Restricted Junior Payments by any Subsidiary of the
Borrower to any Borrower, any Guarantor or wholly owned subsidiary of the
Borrower;

(b)           dividends and distributions declared and paid on the
common Capital Stock of the Borrower and payable only in common Capital Stock
of the Borrower;

(c)           so long as no Default or Event of Default has occurred and
is continuing and no Liquidity Event Period shall be continuing, the Borrower
may purchase the Borrower’s Capital Stock from present or former employees,
directors, officers or members of management (or the estate, family members,
spouse or former spouse of any of the foregoing) upon the death, disability or
termination of employment of such Person; provided, that the aggregate
amount of Restricted Junior Payments permitted pursuant to this clause (d)
shall not exceed $5,000,000 in any Fiscal Year; and

(d)           Restricted Junior Payments constituting (x) any
payments made pursuant to the exercise of the Automotive.com Put/Call Option or
the closing of the share purchase pursuant thereto or (y) the purchase of
minority interests in non-wholly owned Subsidiaries pursuant to customary put
arrangements, drag-along provisions or rights of first refusal contained in
shareholder agreements; provided that either (i) immediately following
such purchase, such Subsidiary becomes a Guarantor and the Borrower and such
Subsidiary complies with the requirements of Section 5.11 and 5.12 or (ii) the
amount of such Restricted Junior Payment under this clause (d) is permitted to
be made as an Investment pursuant to Section 6.6(f)(iv).

6.5            Restrictions on Subsidiary
Distributions. 
Except as provided herein, no Credit Party shall, nor shall it permit
any of its Subsidiaries to, create or otherwise cause or suffer to exist or
become effective any consensual encumbrance or restriction of any kind on the
ability of any Subsidiary of the Borrower to (a) pay dividends or make any
other distributions on any of such Subsidiary’s Capital Stock owned by the
Borrower or any Subsidiary of the Borrower, (b) repay or prepay any Indebtedness
owed by such Subsidiary to the Borrower or any Subsidiary of the Borrower,
(c) make loans or advances to the Borrower or any Subsidiary of the
Borrower, or (d) transfer any of its property or assets to the Borrower or
any other Subsidiary of the Borrower other than restrictions (i) in agreements
evidencing Indebtedness permitted by Section 6.1(i) that impose restrictions on
the property so acquired, (ii) by reason of customary provisions restricting
assignments, subletting or other transfers contained in leases, licenses, joint
venture agreements and similar agreements entered into in the ordinary course
of business, (iii) that are or were created by virtue of any transfer of,
agreement to transfer or option or right with respect to any property, assets
or Capital Stock not otherwise prohibited under this Agreement, (iv) of
Vendors in the ordinary course and (v) in the Term Loan Agreement and the
Bridge Loan Agreement, in each case as in effect on the date hereof and any
Permanent Financing.

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

(a)           Investments in Cash and Cash Equivalents; provided,
that to the extent such Investments are held by a Borrower or a Guarantor, such
Investments shall be maintained in an Approved Deposit Account or Control
Account to the extent required by Section 5.16;

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(b)           equity Investments owned as of the Closing Date in any
Subsidiary and other Investments outstanding on the Closing Date, in each case,
as described in Schedule 6.6;

(c)           Investments (i) in any Securities received in satisfaction
or partial satisfaction of the obligations of financially troubled account
debtors and (ii) deposits, prepayments and other credits to suppliers made
in the ordinary course of business consistent with the past practices of the
Borrower and its Subsidiaries;

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

(e)           loans and advances to employees of the Borrower and its
Subsidiaries made in the ordinary course of business as presently conducted
(other than any loans or advances that would be in violation of Section 402 of
the Sarbanes-Oxley Act) in an aggregate principal amount not to exceed
$2,500,000 in the aggregate at any time;

(f)            Investments made after the Closing Date by (i) any Credit
Party in another Credit Party; (ii) any Credit Party in connection with
Permitted Acquisitions permitted pursuant to Section 6.8(e); (iii) any
non-Credit Party in any Credit Party; or (iv) any Credit Party in a non-Credit
Party; provided, that the aggregate outstanding amount of all
Investments permitted pursuant to this clause (iv) shall not exceed $10,000,000
at any time;

(g)           Investments permitted pursuant to Section 6.1(f);

(h)           Permitted Acquisitions permitted by Section 6.8(e);

(i)            Investments in connection with Swap Contracts permitted
under this Agreement;

(j)            other Investments in an aggregate amount not to exceed at
any time $20,000,000; and

(k)           prepaid royalties to content providers in the ordinary
course of business, the extent such amounts may be characterized as
Investments; and

(l)            payments to Automotive.com pursuant to the Automotive.com
Stock Purchase Agreement and any Automotive.com Earn-Out Obligation, to the
extent such payments may be deemed Investments after giving effect to the
Automotive.com Put/Call Option.

6.7            [Reserved]

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

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(a)           any Subsidiary (i) may be merged with or into any Borrower
or any Guarantor or any other wholly owned Subsidiary, (ii) may be liquidated,
wound up or dissolved, or all or any part of its business, property or assets
conveyed, sold, leased, transferred or otherwise disposed of, in one
transaction or a series of transactions, to any Borrower or any Guarantor,
(iii) may be converted from one form of business organization to another form
of business organization or (iv) that is a Foreign Subsidiary may engage with
another Foreign Subsidiary in any transaction described in clause (i) or (ii)
above; provided, in the case of such a merger (other than in the case of
a merger between Immaterial Subsidiaries and/or Foreign Subsidiaries), the
Borrower or such Guarantor, as applicable shall be the continuing or surviving
Person; provided  further, that in the case of any such
transaction pursuant to clause (iii) above where the surviving corporation is a
Credit Party organized in a state other than Delaware, such surviving Person
shall deliver a certificate of an Authorized Officer and, if requested by the
Administrative Agent, a legal opinion affirming the validity of its Guarantee
and its Lien or its Collateral supporting the Obligations;

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

(c)           Asset Sales, the proceeds of which (valued at the
principal amount thereof in the case of non-Cash proceeds consisting of
notes or other debt Securities and valued at fair market value in the case of
other non-Cash proceeds) when aggregated with the proceeds of all other Asset
Sales made within the same Fiscal Year, are less than $20,000,000; provided
(x) the consideration received for such assets shall be in an amount at least
equal to the fair market value thereof (determined in good faith by the
management of the Borrower), (y) no less than 75% thereof shall be paid in Cash
and (z) in the case of an Asset Sale of Current Asset Collateral, the Net Asset
Sale Proceeds thereof shall be applied as required by Section 2.14(a);

(d)           disposals of obsolete, worn out or surplus property,
restrictive or custom items, defective goods or goods returned or rejected by
customers (except as may be repackaged or otherwise prepared for sale), in each
case, in the ordinary course of business;

(e)           Permitted Acquisitions, the Acquisition Consideration for
which constitutes less than $100,000,000 in the aggregate in any Fiscal Year;  provided, not more than $25,000,000
in the aggregate in any Fiscal Year shall be permitted to be used to acquire
Persons that, once acquired, would constitute non-Credit Parties; and provided
further, the Credit Parties shall have complied with the requirements of
Sections 5.11, 5.12 and 5.13 within 30 days after the consummation of such
Permitted Acquisition;

(f)            other Investments made in accordance with Section 6.6;
and

(g)           Permitted Asset Swaps.

6.9            Disposal of Subsidiary Interests.  Except for any sale of all of its interests
in the Capital Stock of any of its Subsidiaries in compliance with the
provisions of Section 6.8, no Credit Party shall, nor shall it permit any of
its Subsidiaries to, (a) directly or indirectly sell, assign, pledge or otherwise
encumber or dispose of any Capital Stock of any of its Subsidiaries, except to
qualify directors if required by applicable law; or (b) permit any of its
Subsidiaries directly or indirectly to sell, assign, pledge or otherwise
encumber or dispose of any Capital Stock of any of its Subsidiaries, except to
another Credit Party (subject to the restrictions on such disposition otherwise
imposed hereunder), or to qualify directors if required by applicable law; in
each case, except for pledges of such Capital Stock to the Collateral Agent
and, subject to the Intercreditor Agreement, the Term Loan Collateral Agent.

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6.10         Sales and Lease-Backs.  No Credit Party shall, nor shall it permit
any of its Subsidiaries to, directly or indirectly, become liable as lessee or
as a guarantor or other surety with respect to any lease of any property
(whether real, personal or mixed), whether now owned or hereafter acquired,
which such Credit Party (a) has sold or transferred or is to sell or to
transfer to any other Person (other than the Borrower or any of its Subsidiaries),
or (b) intends to use for substantially the same purpose as any other
property which has been or is to be sold or transferred by such Credit Party to
any Person (other than the Borrower or any of its Subsidiaries) in connection
with such lease (each such transaction a “Sale
and Leaseback Transaction”), in each case, unless such transaction
or arrangement complies with Sections 6.1, 6.2 and 6.8.

6.11         Transactions with Shareholders and
Affiliates.  No
Credit Party shall, nor shall it permit any of its Subsidiaries to, directly or
indirectly, enter into or permit to exist any transaction (including the
purchase, sale, lease or exchange of any property or the rendering of any
service) with any shareholder owning more than 5% of the common stock of the Borrower,
Affiliate of the Borrower or such Subsidiaries on terms that are less favorable
to the Borrower or that Subsidiary, as the case may be, than those that might
be obtained at the time from a Person who is not such a shareholder or
Affiliate; provided, that the foregoing restriction shall not apply to
(a) any transaction between the Borrower and any Guarantor or between
Guarantors; (b) any transaction between Subsidiaries that are not
Guarantors, (c) any transaction permitted by Section 6.8(a),
(d) reasonable or customary indemnification and compensation arrangements
for members of the board of directors (or similar governing body), officers and
other employees of the Borrower and its Subsidiaries, including, without
limitation, transaction-specific director fees and retirement, health, stock
option and other benefit plans and arrangements, provided that in the
case of the officers and directors, a majority of the disinterested directors
or a committee of the board of directors composed entirely of disinterested
directors shall approve such transaction; (e) management, consulting,
monitoring, transaction and advisory fees and related expenses payable to Yucaipa
or one of its Affiliates in an aggregate amount in any Fiscal Year not in excess
of the sum of (i) $1,000,000 in respect of annual management fees, plus (ii) any deferred fees (to the extent
such fees were within such amount in clause (i) above originally), plus (iii) 1.0% of the value of
transactions with respect to which Yucaipa or its Affiliates provides any
transaction, advisory or other services, plus
(iv) the amount of all reasonable out-of-pocket expenses related thereto and
unpaid amounts accrued for prior periods, and (f) transactions in the
ordinary course of business consistent with past practices with Automotive.com.

6.12         Conduct of Business.  From and after the Closing Date, no Credit
Party shall, nor shall it permit any of its Subsidiaries to, engage in any
business or lines of business other than those reasonably related to the businesses
or lines of business engaged in by the Credit Parties on the Closing Date.

6.13         Limitation on Issuance of Subsidiary
Capital Stock. 
With respect any Subsidiary, issue any Capital Stock (including by way
of sales of treasury stock) or any options or warrants to purchase, or
securities convertible into, any Capital Stock, except (i) for stock
splits, stock dividends and additional issuances of Qualified Capital Stock
which do not decrease the percentage ownership of such Borrower or any
Subsidiaries in any class of the Qualified Capital Stock of such Subsidiary and
(ii) Subsidiaries of the Borrower formed after the Closing Date in accordance
with Section 6.14 may issue Qualified Capital Stock to the Borrower or
Guarantor which is to own such Qualified Capital Stock.  All Capital Stock issued in accordance with
this Section 6.13 shall, to the extent required by Sections 5.11 and
5.12 or the Pledge and Security Agreement or if such Capital Stock is issued by
the Borrower, be delivered to the Collateral Agent for pledge pursuant to the
applicable Security Agreement.

6.14         Prepayments of Other Indebtedness;
Modifications of Organizational Documents and Other Documents, etc.  Directly
or indirectly:

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(a)           make (or give any notice in respect thereof) any voluntary
or optional payment or prepayment on or redemption or acquisition for value of,
or any prepayment or redemption as a result of any asset sale, change of control
or similar event of, any Indebtedness outstanding under the Bridge Loans, any
Indebtedness constituting a Permanent Financing or any other subordinated
Indebtedness or repayment of Bridge Loans prior to the Final Maturity Date (as
defined in the Bridge Loan Documents), except the prepayment or repayment of
the Bridge Loans pursuant to a Permanent Financing;

(b)           amend or modify, or permit the amendment or modification
of, any provision of any Transaction Document or any document governing any
Material Indebtedness (other than any Term Loan Credit Document, which may be
amended or modified in accordance with the Intercreditor Agreement) in any
manner that is adverse in any material respect to the interests of the Lenders;
and

(c)           terminate, amend or modify any of its Organizational
Documents (including (x) by the filing or modification of any certificate
of designation and (y) any election to treat any Pledged Securities (as defined
in the Pledge and Security Agreement) as a “security” under Section 8-103 of
the UCC other than concurrently with the delivery of certificates representing
such Pledged Securities to the Collateral Agent) or any agreement to which it
is a party with respect to its Capital Stock (including any stockholders’
agreement), or enter into any new agreement with respect to its Capital Stock,
other than any such amendments or modifications or such new agreements which
are not adverse in any material respect to the interests of the Lenders and terminations,
amendments or modifications of Organizational Documents in connection with transactions
permitted by Section 6.8(a); provided that the Borrower may issue such
Capital Stock, so long as such issuance is not prohibited by Section 6.13
or any other provision of this Agreement, and may amend or modify its
Organizational Documents to authorize any such Capital Stock.

6.15         Accounting Changes; Fiscal Year.  Except as disclosed to the Lenders and the
Administrative Agent or as otherwise approved by the Administrative Agent, no
Credit Party shall, nor shall it permit any of its Subsidiaries to change its
(a) accounting treatment and reporting practices or tax reporting treatment,
except as required by GAAP or any applicable requirements of law or
(b) Fiscal Year-end from January 31.

SECTION
7.                                      GUARANTY

7.1            Guaranty of the Obligations.  Subject to the provisions of Section 7.2, to
induce the Lenders to make the Loans and the Issuing Banks to issue Letters of
Credit, each Guarantor hereby absolutely, irrevocably and unconditionally
guarantees to the Administrative Agent for the ratable benefit of the Secured
Parties, jointly with the other Guarantors and severally, as primary obligor
and not merely as surety, the due and punctual payment in full when due of all
Obligations, whether at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise (including amounts that would become due but
for the operation of the automatic stay under Section 362(a) of the
Bankruptcy Code, 11 U.S.C. § 362(a)), whether or not from time to
time reduced or extinguished or hereafter increased or incurred, whether or not
recovery may be or hereafter may become barred by any statute of limitations,
whether or not enforceable as against the Borrower, whether now or hereafter
existing, and whether due or to become due, including principal, interest
(including interest at the contract rate applicable upon default accrued or
accruing after the commencement of any proceeding under the Bankruptcy Code, or
any applicable provisions of comparable state or foreign law, whether or not
such interest is an allowed claim in such proceeding), fees and costs of
collection (collectively, the “Guaranteed
Obligations”).  This Guaranty
constitutes a guaranty of payment and not of collection.

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7.2            Limitation
of Guaranty.  Any term or
provision of this Section 7 or any other Credit Document to the contrary notwithstanding,
the maximum aggregate amount of the Guaranteed Obligations for which any
Guarantor shall be liable shall not exceed the maximum amount for which such
Guarantor can be liable without rendering this Section 7 or any other Credit
Document, as it relates to such Guarantor, subject to avoidance under
applicable law relating to fraudulent conveyance or fraudulent transfer
(including Section 548 of the Bankruptcy Code or any applicable provisions
of comparable state law) (collectively, the “Fraudulent
Transfer Laws”), in each case after giving effect (a) to all other liabilities
of such Guarantor, contingent or otherwise, that are relevant under such
Fraudulent Transfer Laws (specifically excluding, however, any liabilities of
such Guarantor in respect of intercompany Indebtedness to the Borrower to the
extent that such Indebtedness would be discharged in an amount equal to the
amount paid by such Guarantor hereunder) and (b) to the value as assets of such
Guarantor (as determined under the applicable provisions of such Fraudulent
Transfer Laws) of any rights to subrogation, contribution, reimbursement,
indemnity or similar rights held by such Guarantor pursuant to
(i) applicable law, (ii) this Section 7.2(b) or (iii) any other
Contractual Obligations providing for an equitable allocation among such
Guarantor and other Subsidiaries or Affiliates of the Borrower of Obligations
arising under this Section 7.2 or other guaranties of the Obligations of the
Borrower by such parties.

7.3            Contribution.  To the extent that any Guarantor shall be
required hereunder to pay a portion of the Guaranteed Obligations exceeding the
greater of (a) the amount of the economic benefit actually received by
such Guarantor from the Loans and the other financial accommodations provided
to the Borrower under the Credit Documents and (b) the amount such
Guarantor would otherwise have paid if such Guarantor had paid the aggregate
amount of the Guaranteed Obligations (excluding the amount thereof repaid by
the Borrower) in the same proportion as such Guarantor’s net worth at the date
enforcement is sought hereunder bears to the aggregate net worth of all the
Guarantors at the date enforcement is sought hereunder, then such Guarantor
shall be reimbursed by such other Guarantors for the amount of such excess, pro
rata, based on the respective net worth of such other Guarantors at the date
enforcement hereunder is sought.

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

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

(b)           the
Administrative Agent may enforce this Guaranty upon the occurrence of an Event
of Default notwithstanding the existence of any dispute between the Borrower
and any Secured Party with respect to the existence of such Event of Default;

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

(d)           payment
by any Guarantor of a portion, but not all, of the Guaranteed Obligations shall
in no way limit, affect, modify or abridge any Guarantor’s liability for any
portion of the Guaranteed Obligations which has not been paid and without
limiting the generality of the foregoing, if any Secured Party is awarded a
judgment in any suit brought to enforce any Guarantor’s 

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covenant to pay a portion of the Guaranteed
Obligations, such judgment shall not be deemed to release such Guarantor from
its covenant to pay the portion of the Guaranteed Obligations that is not the
subject of such suit, and such judgment shall not, except to the extent
satisfied by such Guarantor, limit, affect, modify or abridge any other Guarantor’s
liability hereunder in respect of the Guaranteed Obligations;

(e)           any
Secured Party, upon such terms as it deems appropriate, without notice or
demand and without affecting the validity or enforceability hereof or giving
rise to any reduction, limitation, impairment, discharge or termination of any
Guarantor’s liability hereunder, from time to time may (i) renew, extend,
accelerate, increase the rate of interest on, or otherwise change the time,
place, manner or terms of payment of the Guaranteed Obligations; (ii) settle,
compromise, release or discharge, or accept or refuse any offer of performance
with respect to, or substitutions for, the Guaranteed Obligations or any
agreement relating thereto and/or subordinate the payment of the same to the
payment of any other obligations; (iii) request and accept other
guaranties of the Guaranteed Obligations and take and hold security for the
payment hereof or the Guaranteed Obligations; (iv) release, surrender,
exchange, substitute, compromise, settle, rescind, waive, alter, subordinate or
modify, with or without consideration, any security for payment of the Guaranteed
Obligations, any other guaranties of the Guaranteed Obligations, or any other
obligation of any Person (including any other Guarantor) with respect to the
Guaranteed Obligations; (v) enforce and apply any security now or
hereafter held by or for the benefit of such Secured Party in respect hereof or
the Guaranteed Obligations and direct the order or manner of sale thereof, or
exercise any other right or remedy that such Secured Party may have against any
such security, in each case as such Secured Party in its discretion may
determine consistent with the applicable Credit Document or the applicable
Related Obligation Document and any applicable security agreement, including
foreclosure on any such security pursuant to one or more judicial or
nonjudicial sales, whether or not every aspect of any such sale is commercially
reasonable, and even though such action operates to impair or extinguish any
right of reimbursement or subrogation or other right or remedy of any Guarantor
against the Borrower or any security for the Guaranteed Obligations; and
(vi) exercise any other rights available to it under the Credit Documents
or any Related Obligation Documents; and

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

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

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

7.6            Guarantors’
Rights of Subrogation, Contribution, etc.  Until the Guaranteed Obligations shall have
been paid in full and the Revolving Commitments shall have terminated and all
Letters of Credit shall have expired or been cancelled, each Guarantor hereby
waives any claim, right or remedy, direct or indirect, that such Guarantor now
has or may hereafter have against the Borrower or any other Guarantor or any of
its assets in connection with this Guaranty or the performance by such
Guarantor of its obligations hereunder, in each case whether such claim, right or
remedy arises in equity, under contract, by statute, under common law or
otherwise and including without limitation (a) any right of subrogation, 

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reimbursement or indemnification that such Guarantor
now has or may hereafter have against the Borrower with respect to the
Guaranteed Obligations, (b) any right to enforce, or to participate in, any
claim, right or remedy that any Secured Party now has or may hereafter have
against the Borrower, and (c) any benefit of, and any right to participate in,
any collateral or security now or hereafter held by any Secured Party.  In addition, until the Guaranteed Obligations
shall have been paid in full and the Revolving Commitments shall have
terminated and all Letters of Credit shall have expired or been cancelled, each
Guarantor shall withhold exercise of any right of contribution such Guarantor
may have against any other guarantor (including any other Guarantor) of the Guaranteed
Obligations, including, without limitation, any such right of contribution as
contemplated by Section 7.3.  Each
Guarantor further agrees that, to the extent the waiver or agreement to
withhold the exercise of its rights of subrogation, reimbursement,
indemnification and contribution as set forth herein is found by a court of
competent jurisdiction to be void or voidable for any reason, any rights of
subrogation, reimbursement or indemnification such Guarantor may have against
the Borrower or against any collateral or security, and any rights of contribution
such Guarantor may have against any such other guarantor, shall be junior and
subordinate to any rights any Secured Party may have against the Borrower, to
all right, title and interest any Secured Party may have in any such collateral
or security, and to any right any Secured Party may have against such other
guarantor (including any Guarantor).  If
any amount shall be paid to any Guarantor on account of any such subrogation,
reimbursement, indemnification or contribution rights at any time when all
Guaranteed Obligations shall not have been paid in full, such amount shall be
held in trust for the Administrative Agent on behalf of Secured Parties and
shall forthwith be paid over to the Administrative Agent for the benefit of
Secured Parties to be credited and applied against the Guaranteed Obligations,
whether matured or unmatured, in accordance with the terms hereof.

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

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

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

7.10         Financial
Condition of the Borrower. 
Any Credit Extension may be made to the Borrower or continued from time
to time, and any Related Obligation Documents may be entered into from time to
time, in each case without notice to or authorization from any Guarantor
regardless of the financial or other condition of the Borrower at the time of
any such grant or continuation or at the time such Related Obligation Document
is entered into, as the case may be.  No
Secured Party shall have any obligation to disclose or discuss with any
Guarantor its assessment, or any Guarantor’s assessment, of the financial
condition of the Borrower.  Each
Guarantor has adequate means to obtain information from the Borrower on a
continuing basis concerning the financial condition of the Borrower and its
ability to perform 

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its obligations under the Credit Documents and the
Related Obligation Documents, and each Guarantor assumes the responsibility for
being and keeping informed of the financial condition of the Borrower and of
all circumstances bearing upon the risk of nonpayment of the Guaranteed
Obligations.  Each Guarantor hereby
waives and relinquishes any duty on the part of any Secured Party to disclose
any matter, fact or thing relating to the business, operations or conditions of
the Borrower now known or hereafter known by any Secured Party.  In the event any Secured Party, in its sole
discretion, undertakes at any time or from time to time to provide any such
information to any Guarantor, such Secured Party shall be under no obligation
(a) to undertake any investigation not a part of its regular business routine,
(b) to disclose any information that such Secured Party, pursuant to accepted
or reasonable commercial finance or banking practices, wishes to maintain
confidential or (c) to make any other or future disclosures of such information
or any other information to any Guarantor.

7.11         Default;
Remedies.  The Obligations of
each Guarantor hereunder are independent of and separate from Guaranteed
Obligations.  If any Obligation of the
Borrower is not paid when due, or upon any Event of Default hereunder or upon
any default by the Borrower as provided in any other Credit Document or Related
Obligation Document, the Administrative Agent may, at its sole election,
proceed directly and at once, without notice, against any Guarantor to collect
and recover the full amount or any portion of the Obligations of the Borrower
then due, without first proceeding against the Borrower or any other guarantor
(including the Guarantors) of the Guaranteed Obligations, or against any Collateral
under the Credit Documents or joining the Borrower or any other guarantor
(including the Guarantors) in any proceeding against any Guarantor.  At any time after maturity of the Guaranteed
Obligations, the Administrative Agent may (unless the Guaranteed Obligations
have been paid in full), without notice to any Guarantor and regardless of the
acceptance of any Collateral for the payment hereof, appropriate and apply
toward the payment of the Guaranteed Obligations (a) any indebtedness due or to
become due from any Secured Party to such Guarantor and (b) any moneys, credits
or other property belonging to such Guarantor at any time held by or coming
into the possession of any Secured Party or any of its respective Affiliates.

7.12         Bankruptcy,
etc.

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

(b)           Each
Guarantor acknowledges and agrees that any interest on any portion of the Guaranteed
Obligations which accrues after the commencement of any case or proceeding
referred to in clause (a) above (or, if interest on any portion of the
Guaranteed Obligations ceases to accrue by operation of law by reason of the
commencement of such case or proceeding, such interest as would have accrued on
such portion of the Guaranteed Obligations if such case or proceeding had not
been commenced) shall be included in the Guaranteed Obligations because it is
the intention of Guarantors and Secured Parties that the Guaranteed Obligations
which are guaranteed by Guarantors pursuant hereto should be determined without
regard to any rule of law or order which may relieve the Borrower of any
portion of such Guaranteed Obligations. 
Guarantors will permit any trustee in bankruptcy, receiver, debtor in possession,
assignee for the benefit of creditors or similar Person to pay the Administrative
Agent, or allow 

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the claim of the Administrative Agent in respect of, any such interest
accruing after the date on which such case or proceeding is commenced.

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

7.13         Waiver
of Judicial Bond.  To the
fullest extent permitted by applicable law, the Guarantor waives the
requirement to post any bond that otherwise may be required of any Secured
Party in connection with any judicial proceeding to enforce such Secured Party’s
rights to payment hereunder, security interest in or other rights to the Collateral
or in connection with any other legal or equitable action or proceeding arising
out of, in connection with, or related to this Guaranty and the Credit Documents
or Related Obligation Documents to which it is a party.

7.14         Discharge
of Guaranty upon Sale of Guarantor. 
If the Capital Stock of any Guarantor or any of its successors in
interest hereunder shall be sold or otherwise disposed of (including by merger
or consolidation) in accordance with the terms and conditions hereof and such
Guarantor shall no longer be a Subsidiary of the Borrower, the Guaranty of such
Guarantor or such successor in interest, as the case may be, hereunder shall
automatically be discharged and released without any further action by any
Secured Party or any other Person effective as of the time of such sale or
other disposition.

SECTION 8.                                      EVENTS
OF DEFAULT

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

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

(b)           Default
in Other Agreements.  (i) Failure of
the Borrower or any Subsidiary to pay when due (after any applicable grace
periods) any principal of or interest on or any other amount payable in respect
of one or more items of Indebtedness for borrowed money (other than
Indebtedness referred to in Section 8.1(a)) in an individual principal amount
of $10,000,000 or more or with an aggregate principal amount of $20,000,000 or
more, in each case beyond the grace period, if any, provided therefor; (ii)
breach or default by the Borrower or any Subsidiary with respect to any other
term of (A) one or more items of Indebtedness for borrowed money in the
individual or aggregate principal amounts referred to in clause (i) above or
(B) any loan agreement, mortgage, indenture or other agreement relating to
such item(s) of Indebtedness, in each case beyond the grace period, if any,
provided therefor, if the effect of such breach or default is to cause, or to
permit the holder or holders of that Indebtedness (or a trustee on behalf of
such holder or holders), to cause, that Indebtedness to become or be declared
due and payable (or redeemable) prior to its stated maturity or the stated
maturity of any underlying obligation, as the case may be; (iii) an “Event of
Default” as defined in the Term Loan Agreement shall occur or (iv) any event of
default or termination event under any Swap Contract to which the Borrower or 

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any Subsidiary is a party which results in
the termination or unwinding of such Swap Contract and the Swap Termination
Value owed by such Person in respect of such Swap Contract exceeds $10,000,000
individually or $20,000,000 in the aggregate for all such Swap Contracts; or

(c)           Breach
of Certain Covenants.  Failure of any
Credit Party to perform or comply with any term or condition contained in
Section 2.5, clauses (e) or (h) of Section 5.1, Section 5.2 or Section 6; or

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

(e)           Other
Defaults Under Credit Documents.  Any
of the Borrower or the Subsidiaries shall default in the performance of or
compliance with any term contained herein or any of the other Credit Documents,
other than any such term referred to in any other Section of this Section 8.1,
and such default shall not have been remedied or waived within thirty (30) days
after the earlier of (i) an officer of the Borrower or the Subsidiaries
becoming aware of such default or (ii) receipt by the Borrower of notice from
any Agent or any Lender of such default; or

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

(g)           Voluntary
Bankruptcy; Appointment of Receiver, etc. 
(i) The Borrower or any of the Subsidiaries shall have an order for
relief entered with respect to it or shall commence a voluntary case under the
Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar
law now or hereafter in effect, or shall consent to the entry of an order for
relief in an involuntary case, or to the conversion of an involuntary case to a
voluntary case, under any such law, or shall consent to the appointment of or
taking possession by a receiver, trustee or other custodian for all or a
substantial part of its property; or the Borrower or any of its Subsidiaries
shall make any assignment for the benefit of creditors; or (ii) the
Borrower or any of the Subsidiaries shall be unable, or shall fail generally,
or shall admit in writing its inability, to pay its debts as such debts become
due; or the board of directors (or similar governing body) of the Borrower or
any of its Subsidiaries (or any committee thereof) shall adopt any resolution
or otherwise authorize any action to approve any of the actions referred to
herein or in Section 8.1(f); or

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(h)           Judgments
and Attachments.  Any judgment, writ,
order or warrant of attachment or similar process (i) involving, in the case of
any monetary judgment, in any individual case an amount in excess of
$10,000,000 or in the aggregate at any time an amount in excess of $20,000,000
or (ii) that, in any other case, could reasonably be expected to have a
Material Adverse Effect, in each case, to the extent not adequately covered by
insurance as to which a solvent and unaffiliated insurance company has acknowledged
coverage, shall be entered or filed against the Borrower or any Subsidiaries or
any of their respective assets and shall remain undischarged, unvacated,
unbonded or unstayed for a period of sixty (60) days (or in any event later
than five (5) days prior to the date of any proposed sale thereunder); or

(i)            Employee
Benefit Plans.  (i) There shall occur
one or more ERISA Events which individually or in the aggregate results in or
might reasonably be expected to result in liability of the Borrower or any of
its Subsidiaries in excess of $10,000,000 during the term hereof; or (ii) there
exists any fact or circumstance that reasonably could be expected to result in
the imposition of a Lien or security interest on any assets of the Borrower or
its Subsidiaries.

(j)            Environmental
Matters.  One or more of the Borrower
and the Subsidiaries shall have entered into one or more consent or settlement
decrees or agreements or similar arrangements with a Governmental Authority or
one or more judgments, orders, decrees or similar actions shall have been
entered against one or more of the Borrower and the Subsidiaries based on or
arising from the violation of or pursuant to any Environmental Law, or the
generation, storage, transportation, treatment, disposal or Release of any
Hazardous Material and, in connection with all the foregoing, the Borrower or
any Subsidiary of the Borrower is likely to incur liabilities, costs and
expenses in excess of $10,000,000 individually and $15,000,000 in the aggregate,
that were not reflected in the Projections or the financial statements or
Projections delivered pursuant to Section 3.1(i) prior to the date hereof; or

(k)           Guaranties,
Collateral Documents and Other Credit Documents.  At any time after the execution and delivery
thereof:

(i)            any of the Guaranty of any Guarantor (other than any
Guarantor that would constitute an Immaterial Subsidiary) for any reason, other
than the satisfaction in full of all Obligations, shall cease to be in full
force and effect (other than in accordance with its terms) or shall be declared
to be null and void or any such Guarantor shall repudiate its obligations
thereunder;

(ii)           this Agreement or any Collateral Document ceases to be in
full force and effect (other than by reason of a release of Collateral in
accordance with the terms hereof or thereof or the satisfaction in full of the
Obligations in accordance with the terms hereof) or shall be declared null and
void, for any reason other than the failure of Collateral Agent or any Secured
Party to take any action within its control;

(iii)          the Collateral Agent shall not have or shall cease to have
a valid and perfected Lien in any Collateral, having a value (in the aggregate
for all such Collateral) in excess of $5,000,000, purported to be covered by
the Collateral Documents with the priority required by the relevant Collateral
Document, for any reason other than the failure of Collateral Agent or any
Secured Party to take any action within its control; or

(iv)          any Credit Party shall contest the validity or
enforceability of any Credit Document in writing or deny in writing that it has
any further liability, including with respect to future advances by Lenders,
under any Credit Document to which it is a party; or

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(l)            Change
of Control.  A Change of Control
shall occur;

THEN, (1) upon the
occurrence of any Event of Default described in Section 8.1(f) or 8.1(g) with
respect to a Borrower, automatically, and (2) upon the occurrence of any other
Event of Default, at the election of the Administrative Agent or at the request
of (or with the consent of) Requisite Lenders, upon notice to the Borrower by
the Administrative Agent, (A) the Revolving Commitments, if any, of each Lender
having such Revolving Commitments and the obligation of each Issuing Bank to
issue any Letter of Credit shall immediately and automatically terminate; (B)
each of the following shall immediately become due and payable, in each case without
presentment, demand, protest or other requirements of any kind, all of which
are hereby expressly waived by each Credit Party:  (I) the unpaid principal amount of and
accrued interest on the Loans, (II) an amount equal to the maximum amount that
may at any time be drawn under all Letters of Credit then outstanding
(regardless of whether any beneficiary under any such Letter of Credit shall
have presented, or shall be entitled at such time to present, the drafts or
other documents or certificates required to draw under such Letters of Credit),
and (III) all other Obligations; provided, the foregoing shall not
affect in any way the obligations of Lenders under Section 2.2 or Section 2.3;
(C) the Administrative Agent may cause Collateral Agent to enforce any and all
Liens and security interests created pursuant to Collateral Documents; and (D)
the Administrative Agent shall direct the Borrower to pay (and the Borrower
hereby agrees upon receipt of such notice, or upon the occurrence of any Event
of Default specified in Sections 8.1(f) and (g) with respect to a Borrower to
pay) to the Administrative Agent such additional amounts of cash as reasonably
requested by any Issuing Bank, to be held as security for the Borrower’s
Reimbursement Obligations then outstanding.

8.2            Actions
in Respect of Letters of Credit. 
At any time (i) upon the Revolving Commitment Termination Date, (ii) as
may be required by Section 2.13, the Borrower shall pay to the Administrative
Agent in immediately available funds at its Principal Office, for deposit in a
Cash Collateral Account, (x) in the case of clause (i) above, the amount
required to that, after such payment, the aggregate funds on deposit in the
Cash Collateral Accounts equals or exceeds 105% of the sum of all outstanding Letter
of Credit Obligations and (y) in the case of clause (ii) above, the amount
required by Section 2.13.  The
Administrative Agent may, from time to time after funds are deposited in any
Cash Collateral Account, apply funds then held in such Cash Collateral Account
to the payment of any amounts, in accordance with Section 2.13 and Section
2.15(i) as shall have become or shall become due and payable by the Borrower to
the Issuing Banks or the Lenders in respect of the Letter of Credit
Obligations.  The Administrative Agent
shall promptly give written notice of any such application; provided, however,
that the failure to give such written notice shall not invalidate any such
application.

8.3            Rescission.  If at any time after termination of the
Revolving Commitments or acceleration of the maturity of the Loans, the
Borrower shall pay all arrears of interest and all payments on account of
principal of the Loans and Reimbursement Obligations that shall have become due
otherwise than by acceleration (with interest on principal and, to the extent
permitted by law, on overdue interest, at the rates specified herein) and all
Events of Default and Defaults (other than non-payment of principal of and
accrued interest on the Loans due and payable solely by virtue of acceleration)
shall be remedied or waived pursuant to Section 10.5, then upon the written
consent of the Requisite Lenders and written notice to the Borrower, the termination
of the Revolving Commitments or the acceleration and their consequences may be
rescinded and annulled; provided, however, that such action shall
not affect any subsequent Event of Default or Default or impair any right or
remedy consequent thereon.  The
provisions of the preceding sentence are intended merely to bind the Lenders
and the Issuing Banks to a decision that may be made at the election of the
Requisite Lenders, and such provisions are not intended to benefit the Borrower
and do not give the Borrower the right to require the Lenders to rescind or
annul any acceleration hereunder, even if the conditions set forth herein are
met.

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SECTION 9.                                      AGENTS

9.1               Appointment
of Agents; Authorization.

JPMCB is hereby appointed
Syndication Agent hereunder, and each Lender and each Issuing Bank hereby
authorizes JPMCB to act as Syndication Agent in accordance with the terms
hereof and the other Credit Documents. 
Wachovia and Wells Fargo are hereby appointed Co-Documentation Agents
hereunder and under the other Credit Documents and each Lender and Issuing Bank
hereby authorizes Wachovia and Wells Fargo to act as Co-Documentation Agents in
accordance with the terms hereof and the other Credit Documents, CNAI is hereby
appointed Administrative Agent and Collateral Agent hereunder and under the
other Credit Documents and each Lender and each Issuing Bank hereby authorizes
CNAI to act as the Administrative Agent and Collateral Agent in accordance with
the terms hereof and the other Credit Documents.  Each Agent hereby agrees to act in its
respective capacity as such upon the express conditions contained herein and
the other Credit Documents, as applicable. 
The provisions of this Section 9 are solely for the benefit of the
Facility Agents, the Lenders and the Issuing Banks and no Credit Party or any
of their Subsidiaries or Affiliates shall have any rights as a third party
beneficiary of any of the provisions thereof. 
In performing its functions and duties hereunder, each Agent shall act
solely as an agent of the Lenders and the Issuing Banks and does not assume and
shall not be deemed to have assumed any obligation towards or relationship of
agency or trust with or for the Borrower or any of its Subsidiaries or
Affiliates.  None of the Lead Arrangers,
the Syndication Agent or the Co-Documentation Agents shall have any obligations
or duties whatsoever under this Agreement or the other Credit Documents and
shall incur no liability hereunder or thereunder in such capacity.

(a)           Each
Lender and each Issuer hereby acknowledges the appointment of CNAI as the Collateral
Agent, and hereby authorizes the Collateral Agent to take such action as agent
on its behalf and to exercise all rights, powers and remedies that the
Collateral Agent may have under the Collateral Documents and the Intercreditor
Agreement, including, without limitation, incurring and paying such Secured
Party Expenses as the Administrative Agent or Collateral Agent may deem
necessary or appropriate for the performance and fulfillment of its functions
and powers pursuant to the Credit Documents.

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

9.3               General
Immunity.

(a)           No
Responsibility for Certain Matters. 
No Agent shall be responsible to any Lender or any Issuing Bank for the
execution, effectiveness, genuineness, legality, validity, enforceability,
collectability or sufficiency of, or the attachment, perfection or priority of
any lien created or purported to be created under or in connection with this
Agreement, or any other Credit Document or for any representations, warranties,
recitals or statements made herein or therein or made in any written or oral
statements or in any financial or other statements, instruments, reports or
certificates or any other documents furnished or made by any Agent to the
Lenders or the Issuing Banks or by or on behalf of any Credit Party, 

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in connection with the Credit Documents and the
transactions contemplated thereby or for the financial condition or business
affairs of any Credit Party or any other Person liable for the payment of any
Obligations, nor shall any Agent be required to ascertain or inquire as to the
performance or observance of any of the terms, conditions, provisions,
covenants or agreements contained in any of the Credit Documents or as to the
use of the proceeds of the Loans or as to the financial condition of any Credit
Party or as to the existence or possible existence of any Event of Default or
Default or to make any disclosures with respect to the foregoing.  Anything contained herein to the contrary
notwithstanding, the Administrative Agent shall not have any liability arising
from confirmations of the amount of outstanding Loans, Reimbursement
Obligations or the Letter of Credit Usage or the component amounts thereof.

(b)           Exculpatory
Provisions.  No Agent nor any of its
officers, partners, directors, employees or agents shall be liable to Lenders
or the Issuing Banks for any action taken or omitted by such Agent under or in
connection with any of the Credit Documents except to the extent caused by such
Agent’s gross negligence or willful misconduct. 
As to any matters not expressly provided for by this Agreement and the
other Credit Documents (including enforcement or collection), the Agents shall
not be required to exercise any discretion or take any action, but shall be required
to act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Requisite Lenders, and
such instructions shall be binding upon all Lenders and each Issuing Bank; provided,
however, that no Agent shall be required to take any action that (i)
such Agent in good faith believes exposes it to personal liability unless such Agent
receives an indemnification satisfactory to it from the Lenders and the Issuing
Banks with respect to such action or (ii) is contrary to this Agreement, the
Intercreditor Agreement or applicable law. 
Each Agent agrees to give to each Lender and each Issuing Bank prompt
notice of each notice given to it by any Credit Party pursuant to the terms of
this Agreement or the other Credit Documents. 
Without prejudice to the generality of the foregoing, (i) each Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
communication, instrument or document believed by it to be genuine and correct
and to have been signed or sent by the proper Person or Persons, including the
Register, and shall be entitled to rely and shall be protected in relying on
opinions, judgments and advice (in good faith) of attorneys (who may be
attorneys for the Borrower and its Subsidiaries), accountants, experts and
other professional advisors selected by it; (ii) none of the Lenders or
the Issuing Banks shall have any right of action whatsoever against any Agent
as a result of such Agent acting or (where so instructed) refraining from
acting hereunder or any of the other Credit Documents in accordance with the
instructions of Requisite Lenders (or such other Lenders as may be required to
give such instructions under Section 10.5); (iii) the Administrative Agent may
treat the payee of any Note as its holder until such Note has been assigned in
accordance with Section 10.6; and (iv) no Agent makes any warranty or representation
to any Lender or any Issuing Bank in connection with this Agreement or any
other Credit Documents.

(c)           Delegation
of Duties. Each Agent may perform any and all of its duties and exercise
its rights and powers under this Agreement or under any other Credit Document
by or through any one or more sub-agents appointed by such Agent. Each Agent
and any such sub-agent may perform any and all of its duties and exercise its
rights and powers by or through their respective Affiliates. The exculpatory,
indemnification and other provisions of this Section 9.3 and of Section 9.6
shall apply to any the Affiliates of the Agents and shall apply to their
respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as the applicable Agent.  All of the rights, benefits, and privileges
(including the exculpatory and indemnification provisions) of this Section 9.3
and of Section 9.6 shall apply to any such sub-agent and to the Affiliates of
any such sub-agent, and shall apply to their respective activities as sub-agent
as if such sub-agent and Affiliates were named herein.  Notwithstanding anything herein to the
contrary, with respect to each sub-agent appointed by a Agent, (i) such
sub-agent shall be a third party beneficiary under this Agreement with respect
to all such rights, benefits and privileges (including exculpatory rights and
rights to indemnification) and shall have all of the rights and benefits of a
third party beneficiary, including an independent right of action to enforce
such rights, 

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benefits and privileges (including exculpatory rights and rights to
indemnification) directly, without the consent or joinder of any other Person,
against any or all of the Credit Parties, the Lenders and the Issuing Banks,
(ii) such rights, benefits and privileges (including exculpatory rights and
rights to indemnification) shall not be modified or amended without the consent
of such sub-agent, and (iii) such sub-agent shall only have obligations to the
applicable Agent and not to any Credit Party, Lender, Issuing Bank, other Agent
or any other Person and no Credit Party, Lender, Issuing Bank, other Agent or
any other Person shall have any rights, directly or indirectly, as a third
party beneficiary or otherwise, against such sub-agent.

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

9.5            Representations,
Warranties and Acknowledgment by Lenders and Issuing Banks.

(a)           Each
Lender and each Issuing Bank represents and warrants that it has made its own independent
investigation of the financial condition and affairs of the Borrower and its
Subsidiaries in connection with Credit Extensions hereunder and that it has
made and shall continue to make its own independent appraisal, without reliance
upon any Facility Agent, any other Lender or any other Issuing Bank, of the
creditworthiness of the Borrower and its Subsidiaries.  No Facility Agent shall have any duty or
responsibility, either initially or on a continuing basis, to make any such
investigation or any such appraisal on behalf of the Lenders or the Issuing
Banks or to provide any Lender or any Issuing Bank with any credit or other
information with respect thereto, whether coming into its possession before the
making of the Loans or at any time or times thereafter, and no Facility Agent
shall have any responsibility with respect to the accuracy of or the
completeness of any information provided to the Lenders or the Issuing Banks.

(b)           Each
Lender and each Issuing Bank, by delivering its signature page to this Agreement
or an Assignment and funding its Loans on the Closing Date, shall be deemed to
have acknowledged receipt of, and consented to and approved, each Credit
Document and each other document required to be approved by any Facility Agent,
the Requisite Lenders, the Lenders or the Issuing Banks, as applicable on the
Closing Date.

9.6            Right
to Indemnity.  Each Lender, in
proportion to its Pro Rata Share, severally agrees to indemnify each Agent and
each of its Affiliates, and each of their respective directors, officers,
employees, agents and advisors, to the extent that such Agent shall not have
been reimbursed by any Credit Party, for and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including fees and disbursements of financial and legal advisors) or
disbursements of any kind or nature whatsoever which may be imposed on,
incurred by or asserted against such Agent or any of its Affiliates, directors,
officers, employees, agents and advisors in exercising its powers, rights and
remedies or performing its duties hereunder or under the other Credit Documents
or 

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otherwise in its capacity as such Agent in any way relating to or
arising out of this Agreement or the other Credit Documents; provided,
no Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from such Agent’s gross negligence or willful misconduct.  If any indemnity furnished to any Agent for
any purpose shall, in the opinion of such Agent, be insufficient or become
impaired, such Agent may call for additional indemnity and cease, or not commence,
to do the acts indemnified against until such additional indemnity is furnished;
provided, in no event shall this sentence require any Lender to indemnify
any Agent against any liability, obligation, loss, damage, penalty, action,
judgment, suit, cost, expense or disbursement in excess of such Lender’s Pro
Rata Share thereof; and provided, further, this sentence shall
not be deemed to require any Lender to indemnify any Agent against any liability,
obligation, loss, damage, penalty, action, judgment, suit, cost, expense or
disbursement described in the proviso in the immediately preceding
sentence.  Without limiting the foregoing,
each Lender agrees to reimburse the Agents promptly upon demand for its ratable
share of any out-of-pocket expenses (including fees, expenses and disbursements
of financial and legal advisors) incurred by the Agents in connection with the
preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of its rights or responsibilities under, this
Agreement or the other Credit Documents, to the extent that the Agents are not
reimbursed for such expenses by the Borrower or another Credit Party.

9.7            Successor
Facility Agents and Swing Line Lender.

(a)           Each
of the Administrative Agent and the Collateral Agent may resign at any time by
giving 30 days’ prior written notice thereof to other Agent, the Lenders and
the Borrower, and each such Agent may be removed at any time with or without
cause by an instrument or concurrent instruments in writing delivered to the
Borrower and the Facility Agents and signed by Requisite Lenders.

(i)            Upon
any such notice of resignation or any such removal, the Requisite Lenders shall
have the right, upon 5 Business Days’ notice to the Borrower, to appoint a successor
Administrative Agent or Collateral Agent, as applicable.  If no such successor Agent shall have been so
appointed by the Requisite Lenders, and shall have accepted such appointment,
within 30 days after the retiring Agent’s giving of notice of resignation, then
the retiring Agent may, on behalf of the Lenders, appoint an applicable
successor Agent selected from among the Lenders.

(ii)           Upon
the acceptance of any appointment as Administrative Agent or Collateral Agent,
as the case maybe, hereunder by a successor Agent, that successor Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring or removed Agent and the retiring or removed Agent
shall promptly (A) in the case of the Administrative Agent, (I) transfer to
such successor Administrative Agent all sums held by it under the Credit
Documents, together with all records and other documents necessary or
appropriate in connection with the performance of the duties of the successor
Administrative Agent under the Credit Documents and (II) take such other
actions, as may be necessary or appropriate in connection therewith, whereupon
such retiring or removed Administrative Agent shall be discharged from its
duties and obligations hereunder and (B) in the case of the Collateral Agent,
(I) transfer to such successor Collateral Agent all sums, Securities and other
items of Collateral held under the Collateral Documents, together with all
records and other documents necessary or appropriate in connection with the
performance of the duties of the successor Collateral Agent under the Credit
Documents and (II) execute and deliver to such successor Collateral Agent such
amendments to financing statements, and take such other actions, as may be
necessary or appropriate in connection with the assignment to such successor
Collateral Agent of the security interests created under the Collateral Documents,
whereupon such retiring or removed Collateral Agent shall be discharged from
its duties and obligations hereunder.

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(iii)          After
any retiring or removed Agent’s resignation or removal hereunder as such Agent,
the provisions of this Section 9 shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was an Agent hereunder.  Any resignation or removal of CNAI or its
successor as Administrative Agent or Collateral Agent, as the case may be,
pursuant to this Section shall also constitute the resignation or removal of
CNAI or its successor as Collateral Agent or Administrative Agent, respectively,
and any successor Administrative Agent or Collateral Agent, as the case may be,
appointed pursuant to this Section shall, upon its acceptance of such
appointment, become the successor Collateral Agent or Administrative Agent,
respectively, for all purposes hereunder.

(iv)          Any
resignation or removal of CNAI or its successor as Agent pursuant to this
Section shall also constitute the resignation or removal of CNAI or its
successor as Swing Line Lender, and any successor Administrative Agent
appointed pursuant to this Section shall, upon its acceptance of such appointment,
become the successor Swing Line Lender for all purposes hereunder.  In such event (A) the Borrower shall
prepay any outstanding Swing Line Loans made by the retiring or removed
Administrative Agent in its capacity as Swing Line Lender, (B) upon such
prepayment, the retiring or removed Administrative Agent and Swing Line Lender
shall surrender any Swing Line Note held by it to the Borrower for
cancellation, and (C) the Borrower shall issue, if so requested by
successor Administrative Agent and Swing Line Loan Lender, a new Swing Line
Note to the successor Administrative Agent and Swing Line Lender, in the
principal amount of the Swing Line Loan Sublimit then in effect and with other
appropriate insertions.

(b)           The
Syndication Agent or other Co-Documentation Agent may resign as Syndication
Agent or Co-Documentation Agent, as the case may be, upon 30 days’ notice to
the other Facility Agents and the Lenders; provided that upon the
effectiveness of such resignation, each reference in this Agreement to the
Syndication Agent shall be deemed to be a reference to the Administrative
Agent.

9.8            Collateral Documents and Guaranty.

(a)           Agents
Under Collateral Documents and Guaranty.

(i)            Each
Lender and each Issuing Bank hereby further authorizes the Administrative Agent
and the Collateral Agent, as applicable, on behalf of and for the benefit of Secured
Parties, to be the agent for and representative of Lenders with respect to the
Guaranty, the Collateral and the Collateral Documents.

(ii)           Each
Lender and each Issuing Bank agrees that any action taken by the Administrative
Agent or the Requisite Lenders (or, where required by the express terms of this
Agreement, a greater proportion of the Lenders) in accordance with the
provisions of this Agreement or of the other Credit Documents, and the exercise
by the Administrative Agent or the Requisite Lenders (or, where so required,
such greater proportion) of the powers set forth herein or therein, together
with such other powers as are reasonably incidental thereto, shall be
authorized and binding upon all of the Lenders and the Issuing Banks.  Without limiting the generality of the
foregoing, the Administrative Agent shall have the sole and exclusive right and
authority to act as the disbursing and collecting agent for the Lenders and the
Issuing Banks with respect to all payments and collections arising in
connection with the Revolving Credit Facility.

(iii)          Each
Lender and each Issuing Bank agrees that any action taken by the Collateral
Agent in accordance with the provisions of this Agreement or of the other
Credit Documents, and the exercise by the Collateral Agent of the powers set
forth herein or therein, together with such other powers as are reasonably
incidental thereto, shall be authorized and binding upon all of the Lenders,
the Issuing Bank and the other Secured Parties. 
Without limiting the generality of the foregoing, the Collateral Agent
shall have the sole and exclusive right and authority to (A) act as the
disbursing and collecting agent for the 

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Lenders and the Issuing Banks with respect to all payments and
collections arising in connection with the Collateral and with the Collateral
Documents, (B) execute and deliver each Collateral Document and accept delivery
of each such agreement delivered by the Borrower or any of the Subsidiaries,
(C) act as collateral agent for the Lenders, the Issuing Banks and the other
Secured Parties for purposes of the perfection of all security interests and
Liens created by such agreements and all other purposes stated therein; provided,
however, that the Collateral Agent hereby appoints, authorizes and
directs the Administrative Agent, each Lender and each Issuing Bank to act as
collateral sub-agent for the Agents, the Lenders, the Issuing Banks and the
other Secured Parties for purposes of the perfection of all security interests
and Liens with respect to the Collateral, including any Deposit Accounts
maintained by a Credit Party with, and cash and Cash Equivalents held by, a Agent,
such Lender or such Issuing Bank, (D) manage, supervise and otherwise deal
with the Collateral, (E) take such action as is necessary or desirable to maintain
the perfection and priority of the security interests and Liens created or
purported to be created by the Collateral Documents, and (F) except as may be
otherwise specifically restricted by the terms hereof or of any other Credit
Document (including the Intercreditor Agreement), upon receipt of instructions
from the Administrative Agent, exercise all remedies given to any Agent, the
Lenders, the Issuing Banks and the other Secured Parties with respect to the
Collateral under the Credit Documents relating thereto, applicable law or otherwise.

(b)           Certain
Releases.  Subject to the Intercreditor
Agreement, each of the Lenders and the Issuing Banks hereby:

(i)            consents to the release and hereby
directs, in accordance with the terms hereof, the Collateral Agent to release
(or, in the case of clause (ii) below, release or subordinate) any Lien held by
the Collateral Agent for the benefit of the Lenders and the Issuing Banks
against any of the following:

(ii)           (A)          all
of the Collateral and all Credit Parties, upon termination of the Commitments
and payment and satisfaction in full of all Loans, all Reimbursement
Obligations and all other Obligations that the Administrative Agent has been
notified in writing are then due and payable (and, in respect of contingent
Letter of Credit Obligations, with respect to which cash collateral has been
deposited or a back-up letter of credit has been issued, in either case in the
appropriate currency and on terms satisfactory to the Administrative Agent and
the applicable Issuing Banks);

(B)           any
assets that are subject to a Lien permitted by Sections 6.2(m), (n) and (o);
and

(C)           any
part of the Collateral sold or disposed of by a Credit Party if such sale or disposition
is permitted by this Agreement (or permitted pursuant to a waiver of or consent
to a transaction otherwise prohibited by this Agreement).

(iii)          directs, in accordance with the terms
hereof, the Administrative Agent, at its option and in its discretion, to
release any Guarantor from its obligations under the Guaranty if such Person
ceases to be a Subsidiary as a result of a transaction permitted hereunder; and

(iv)          directs the Agents to execute and
deliver or file such termination and partial release statements and do such
other things as are necessary to release Liens to be released pursuant to this
Section 9.8(b) promptly upon the effectiveness of any such release.

(c)           Right
to Realize on Collateral and Enforce Guaranty.  Anything contained in any of the Credit
Documents to the contrary notwithstanding, the Borrower, Administrative Agent,
Collateral Agent 

 114
 

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

(d)           Intercreditor
Agreement.  Each Lender and each
Issuing Bank hereby acknowledges that it has fully reviewed the Intercreditor
Agreement and, by its execution of this Agreement, hereby consents to the
execution and delivery of the Intercreditor Agreement by the Agents and agrees
to comply with the terms thereof (which terms are incorporated herein by
reference in their entirety) as if such Lender or Issuing Bank were a direct
signatory thereto.

9.9            Approved
Electronic Communications.

(a)           Each
of the Lenders, the Issuing Banks, the Borrower and each Guarantor agrees that
the Agents may, but shall not be obligated to, make the Approved Electronic
Communications available to the Lenders and the Issuing Banks by posting such
Approved Electronic Communications on IntraLinksTM or a substantially similar
electronic platform chosen by the Agents to be their electronic transmission
system (the “Platform”).

(b)           Although
the Platform and its primary web portal are secured with generally-applicable
security procedures and policies implemented or modified by the Agents from
time to time (including, as of the Closing Date, a dual firewall and a User
ID/Password Authorization System) and the Platform is secured through a
single-user-per-deal authorization method whereby each user may access the
Platform only on a deal-by-deal basis, each of the Lenders, the Issuing Banks,
the Borrower and each Guarantor agrees that the distribution of material
through an electronic medium is not necessarily secure and that there are
confidentiality and other risks associated with such distribution.  In consideration for the convenience and
other benefits afforded by such distribution and for the other consideration
provided hereunder, the receipt and sufficiency of which is hereby
acknowledged, Lenders, the Issuing Banks, the Borrower and each Guarantor
hereby approves distribution of the Approved Electronic Communications through
the Platform and understands and assumes, and the Borrower shall cause each
Guarantor to understand and assume, the risks of such distribution.

(c)           THE
PLATFORM AND THE APPROVED ELECTRONIC COMMUNICATIONS ARE PROVIDED “AS IS” AND “AS
AVAILABLE.”  NONE OF THE AGENTS OR ANY OF
THEIR RESPECTIVE AFFILIATES OR ANY OF THEIR RESPECTIVE OFFICERS, DIRECTORS,
EMPLOYEES, AGENTS, ADVISORS OR REPRESENTATIVES (THE “AGENT AFFILIATES”) WARRANT THE ACCURACY, ADEQUACY OR
COMPLETENESS OF THE APPROVED ELECTRONIC COMMUNICATIONS OR THE PLATFORM AND EACH
EXPRESSLY DISCLAIMS LIABILITY FOR ERRORS OR OMISSIONS IN THE PLATFORM AND THE
APPROVED ELECTRONIC COMMUNICATIONS.  NO
WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING, WITHOUT
LIMITATION, ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM 

 115
 

FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE AGENT AFFILIATES IN
CONNECTION WITH THE PLATFORM OR THE APPROVED ELECTRONIC COMMUNICATIONS.

(d)           Each
of the Lenders, the Issuing Banks, the Borrower and each Guarantor agrees that
each Agent may, but (except as may be required by applicable law) shall not be
obligated to, store the Approved Electronic Communications on the Platform in
accordance with such Agent’s generally-applicable document retention procedures
and policies.

9.10         Collateral
Matters Relating to Related Obligations.  The benefit of the Credit Documents and of
the provisions of this Agreement relating to the Collateral shall extend to and
be available in respect of any Obligation arising under any Hedge Agreement or
any Cash Management Obligation or that is otherwise owed to Persons other than
the Facility Agents, the Lenders and the Issuing Banks (collectively, “Related Obligations”) solely on the
condition and understanding, as among the Facility Agents and all Secured
Parties, that (a) the Related Obligations shall be entitled to the benefit of
the Credit Documents and the Collateral to the extent expressly set forth in
this Agreement and the other Credit Documents and to such extent the Collateral
Agent shall hold, and have the right and power to act with respect to, the
Guaranty and the Collateral on behalf of and as agent for the holders of the
Related Obligations, but each Facility Agent is otherwise acting solely as
agent for the Lenders and the Issuing Banks and shall have no fiduciary duty,
duty of loyalty, duty of care, duty of disclosure or other obligation
whatsoever to any holder of Related Obligations, (b) all matters, acts and
omissions relating in any manner to the Guaranty, the Collateral, or the
omission, creation, perfection, priority, abandonment or release of any Lien,
shall be governed solely by the provisions of this Agreement and the other
Credit Documents and no separate Lien, right, power or remedy shall arise or
exist in favor of any Secured Party under any separate instrument or agreement
or in respect of any Related Obligation, (c) each Secured Party shall be bound
by all actions taken or omitted, in accordance with the provisions of this
Agreement and the other Credit Documents, by any Facility Agent and the
Requisite Lenders, each of whom shall be entitled to act at its sole discretion
and exclusively in its own interest given its own Commitments and its own
interest in the Loans, Letter of Credit Obligations and other Obligations to it
arising under this Agreement or the other Credit Documents, without any duty or
liability to any other Secured Party or as to any Related Obligation and
without regard to whether any Related Obligation remains outstanding or is
deprived of the benefit of the Collateral or becomes unsecured or is otherwise
affected or put in jeopardy thereby, (d) no holder of Related Obligations and
no other Secured Party (except the Facility Agents, the Lenders and the Issuing
Banks, to the extent set forth in this Agreement) shall have any right to be
notified of, or to direct, require or be heard with respect to, any action
taken or omitted in respect of the Collateral or under this Agreement or the
Credit Documents and (e) no holder of any Related Obligation shall exercise any
right of setoff, banker’s lien or similar right except to the extent provided
in Section 10.4 and then only to the extent such right is exercised in
compliance with Section 2.16.

9.11         Withholding Taxes.  To the extent required by any applicable law,
the Administrative Agent may withhold from any payment to any Lender an amount
equivalent to any applicable withholding tax. 
If the Internal Revenue Service or any other authority of the United
States or other jurisdiction asserts a claim that the Administrative Agent did
not properly withhold tax from amounts paid to or for the account of any Lender
for any reason (including, without limitation, because the appropriate form was
not delivered or not properly executed, or because such Lender failed to notify
the Administrative Agent of a change in circumstances that rendered the
exemption from, or reduction of, withholding tax ineffective), such Lender
shall indemnify and hold harmless the Administrative Agent (to the extent that
the Administrative Agent has not already been reimbursed by the Borrower and
without limiting the obligation of any Borrower to do so) for all amounts paid,
directly or indirectly, by the Administrative Agent as tax or otherwise,
including any interest, additions to tax or penalties applicable thereto,
together with all expenses incurred, including legal expenses and any other out-of-pocket expenses.

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SECTION 10.                               MISCELLANEOUS

10.1         Notices.

(a)           Notices
Generally.  Any notice or other
communication herein required or permitted to be given to a Credit Party, any
Agent, the Swing Line Lender, any Lender, or the Issuing Bank, shall be sent to
such Person’s address as set forth on Appendix B or in the other relevant
Credit Document, and in the case of any Lender, as may be otherwise indicated
to Administrative Agent in writing. 
Except as otherwise set forth in paragraph (b) below, each notice
hereunder shall be in writing and may be personally served, telexed, sent by
telefacsimile, United States mail or courier service or electronic mail and
shall be deemed to have been given when delivered in person or by courier
service and signed for against receipt thereof, upon receipt of telefacsimile,
telex or electronic mail, or three Business Days after depositing it in the
United States mail with postage prepaid and properly addressed.

(b)           Electronic
Communications.  Notwithstanding
clause (a) above (unless the Administrative Agent requests that the provisions
of clause (a) above be followed) and any other provision in this Agreement or
any other Credit Document providing for the delivery of any Approved Electronic
Communication by any other means the Credit Parties shall deliver all Approved
Electronic Communications to the Administrative Agent or other applicable Agent
by properly transmitting such Approved Electronic Communications in an
electronic/soft medium in a format acceptable to the Administrative Agent to oploanswebadmin@citigroup.com
or such other electronic mail address (or similar means of electronic delivery)
as the Administrative Agent may notify the Borrower.  Nothing in this clause (b) shall prejudice
the right of any Agent or any Lender or Issuing Bank to deliver any Approved
Electronic Communication to any Credit Party in any manner authorized in this
Agreement or to request that the Borrower effect delivery in such manner.  Notices and other communications delivered by
posting to a Platform, an Internet website or a similar telecommunication
device requiring that a user have prior access to such Platform, website or
other device (to the extent permitted by Section 9.9 to be delivered
thereunder) shall be effective when such notice or other communication shall
have been made generally available on such Platform, Internet website or
similar device to the class of Person being notified (regardless of whether any
such Person must accomplish, and whether or not any such Person shall have
accomplished, any action prior to obtaining access to such items, including
registration, disclosure of contact information, compliance with a standard
user agreement or undertaking a duty of confidentiality) and such Person has
been notified that such communication has been posted to the Platform.

10.2         Expenses.

(a)           From
and after the Closing Date, the Borrower agrees upon demand to pay, or
reimburse each Facility Agent for, all of each Facility Agent’s reasonable
out-of-pocket audit, legal, appraisal, valuation, filing, document duplication
and reproduction and investigation expenses and for all other reasonable
out-of-pocket costs and expenses of every type and nature (including the
reasonable fees, expenses and disbursements of (x) one primary counsel to the
Facility Agents and (y) not more than one counsel to the Facility Agents in
each appropriate jurisdiction or specialty (as reasonably determined by the
Administrative Agent), internal per diem field examination costs, the
reasonable fees and expenses of appraisers, auditors, insurance advisors,
environmental advisors, accountants, and consultants advising the Facility
Agents, reasonable expenses incurred in connection with due diligence and
travel, courier, reproduction, printing and delivery expenses) incurred by any
Facility Agent in connection with any of the following:  (i) the Administrative Agent’s audit and
investigation of the Borrower and the Subsidiaries in connection with the
preparation, negotiation or execution of any Credit Document or the Administrative
Agent’s periodic audits of the Borrower or any of the Subsidiaries, as the case
may be, (ii) the preparation, negotiation, execution or interpretation of this
Agreement, any Credit Document, or the making of the Credit Extensions
hereunder, (iii) the creation, perfection or protection of the Liens under any
Credit 

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Document (including any reasonable fees, disbursements and expenses for
local counsel in appropriate jurisdictions), (iv) the ongoing administration of
this Agreement and the Credit Extensions, including consultation with attorneys
in connection therewith and with respect to the rights and responsibilities of
the Facility Agents hereunder and under the other Credit Documents, (v) the
protection, collection or enforcement of any Obligation or the enforcement of
any Credit Document, (vi) the commencement, defense or intervention in any
court proceeding relating in any way to the Obligations, any Credit Party, any
of the Subsidiaries, the Purchase, the Related Agreements, the Related
Obligation Documents, this Agreement or any other Credit Document, (vii) the
response to, and preparation for, any subpoena or request for document
production with which any Facility Agent is served or deposition or other
proceeding in which any Facility Agent is called to testify, in each case,
relating in any way to the Obligations, any Credit Party, any of the
Subsidiaries, the Purchase, the Related Agreements, the Related Obligation
Documents, this Agreement or any other Credit Document or (viii) any amendment,
consent, waiver, assignment, restatement, or supplement to any Credit Document
or the preparation, negotiation and execution of the same.

(b)           The
Borrower further agrees to pay or reimburse each Facility Agent and each of the
Lenders and Issuing Banks upon demand for all out-of-pocket costs and expenses,
including reasonable attorneys’ fees (including costs of settlement) (which
shall be limited to the reasonable attorneys’ fees of (x) Cahill Gordon &
Reindel LLP, counsel to the
Facility Agents, (y) one primary counsel to the Lenders, (z) special counsel to
the Facility Agents, the Lenders and the Issuing Banks in each appropriate
jurisdiction or specialty (as reasonably determined by the Administrative
Agent), the interests of any Lender, any Issuing Bank or any group of Lenders
or Issuing Banks (other than all the Lenders and Issuing Banks) are distinctly
or disproportionately affected, one additional counsel for each such Lender or
group of Lenders), incurred by the Facility Agents, such Lenders or such
Issuing Banks in connection with any of the following:  (i) in enforcing any Credit Document or
Obligation or any security therefor or exercising or enforcing any other right
or remedy available by reason of an Event of Default, (ii) in connection with
any refinancing or restructuring of the credit arrangements provided hereunder
in the nature of a “work-out” or in any insolvency or bankruptcy proceeding,
(iii) in commencing, defending or intervening in any litigation or in filing a
petition, complaint, answer, motion or other pleadings in any legal proceeding
relating to the Obligations, any Credit Party, any of the Subsidiaries and
related to or arising out of the transactions contemplated hereby or by any
other Credit Document, any Related Agreement or any Related Obligation Document
or (iv) in taking any other action in or with respect to any suit or proceeding
(bankruptcy or otherwise) described in clause (i), (ii) or (iii) above.

10.3         Indemnity.

(a)           In
addition to the payment of expenses pursuant to Section 10.2, whether or not
the transactions contemplated hereby shall be consummated, each Credit Party
agrees to defend (subject to Indemnitees’ selection of counsel), indemnify, pay
and hold harmless, each Facility Agent, each Issuing Bank and each Lender and
the officers, partners, directors, trustees, employees, agents, sub-agents and
Affiliates of each Facility Agent, each Issuing Bank and each Lender (each, an “Indemnitee”), from and against any and all
Indemnified Liabilities; provided, no Credit Party shall have any
obligation to any Indemnitee hereunder with respect to any Indemnified
Liabilities to the extent a court of competent jurisdiction that such
Indemnified Liabilities have been incurred by reason of the gross negligence or
willful misconduct by such Indemnitee, or a breach in bad faith by such
Indemnitee of its obligations under the Credit Documents.  To the extent that the undertakings to
defend, indemnify, pay and hold harmless set forth in this Section 10.3 may be
unenforceable in whole or in part because they are violative of any law or
public policy, the applicable Credit Party shall contribute the maximum portion
that it is permitted to pay and satisfy under applicable law to the payment and
satisfaction of all Indemnified Liabilities incurred by Indemnitees or any of
them.

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(b)           To
the extent permitted by applicable law, no Credit Party shall assert, and each
Credit Party hereby waives, any claim against each Lender, each Issuing Bank
and each Facility Agent, and each of their respective Affiliates, directors,
employees, attorneys, agents or sub-agents, on any theory of liability, for
special, indirect, consequential or punitive damages (including, without
limitation, any loss of profits, business or anticipated savings) (as opposed
to direct or actual damages) (,whether or not the claim therefor is based on contract,
tort or duty imposed by any applicable legal requirement,) arising out of, in
connection with, arising out of, as a result of, or in any way related to, this
Agreement or any Credit Document or any agreement or instrument contemplated
hereby or thereby or referred to herein or therein, the transactions
contemplated hereby or thereby, any Loan or the use of the proceeds thereof or
any act or omission or event occurring in connection therewith, and the
Borrower and each other Credit Party hereby waives, releases and agrees not to
sue upon any such claim or any such damages, whether or not accrued and whether
or not known or suspected to exist in its favor.

(c)           Each
Credit Party agrees that any indemnification or other protection provided to
any Indemnitee pursuant to this Agreement (including pursuant to this Section
10.3) or any other Credit Document shall (i) survive payment in full of the
Obligations and (ii) inure to the benefit of any Person that was at any time an
Indemnitee under this Agreement or any other Credit Document.

(d)           IN
NO EVENT SHALL ANY AGENT AFFILIATE HAVE ANY LIABILITY TO ANY CREDIT PARTY,
LENDER, ISSUING BANK OR ANY OTHER PERSON FOR DAMAGES OF ANY KIND, INCLUDING
DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSSES OR
EXPENSES (WHETHER IN TORT OR CONTRACT OR OTHERWISE) ARISING OUT OF ANY CREDIT
PARTY OR ANY AGENT AFFILIATE’S TRANSMISSION OF APPROVED ELECTRONIC
COMMUNICATIONS THROUGH THE INTERNET OR ANY USE OF THE PLATFORM, EXCEPT TO THE
EXTENT SUCH LIABILITY OF ANY AGENT AFFILIATE IS FOUND IN A FINAL NON-APPEALABLE
JUDGMENT BY A COURT OF COMPETENT JURISDICTION TO HAVE RESULTED PRIMARILY FORM
SUCH AGENT AFFILIATE’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.

10.4         Set-Off.  In addition to any rights now or hereafter
granted under applicable law and not by way of limitation of any such rights,
subject to the Intercreditor Agreement, upon the occurrence of any Event of Default
each Lender, each Issuing Bank and each Facility Agent is hereby authorized by
each Credit Party at any time or from time to time subject to the consent of
Administrative Agent (such consent not to be unreasonably withheld or delayed),
without notice to any Credit Party or to any other Person (other than
Administrative Agent), any such notice being hereby expressly waived, to set
off and to appropriate and to apply any and all deposits (general or special,
including Indebtedness evidenced by certificates of deposit, whether matured or
unmatured, but not including trust accounts) and any other Indebtedness at any
time held or owing by such Lender, Issuing Bank or Facility Agent to or for the
credit or the account of any Credit Party against and on account of the
obligations and liabilities of any Credit Party to such Person hereunder, the
Letters of Credit and participations therein and under the other Credit
Documents, including all claims of any nature or description arising out of or
connected hereto, the Letters of Credit and participations therein or with any
other Credit Document, irrespective of whether or not (a) such Person shall
have made any demand hereunder or (b) the principal of or the interest on the
Loans or any amounts in respect of the Letters of Credit or any other amounts due
hereunder shall have become due and payable pursuant to Section 2 and
although such obligations and liabilities, or any of them, may be contingent or
unmatured.

10.5         Amendments
and Waivers.

(a)           Requisite
Lenders’ Consent.  Except as
expressly provided otherwise in the Intercreditor Agreement and subject to
Sections 10.5(b) and 10.5(c), no amendment, modification, termination or 

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waiver of any provision of this Agreement or the Intercreditor or the
Pledge and Security Agreement , or consent to any departure by any Credit Party
therefrom, shall in any event be effective without the written concurrence of
the Requisite Lenders; provided, that the Administrative Agent may, with
the consent of the Borrower only, amend, modify or supplement this Agreement to
cure any minor ambiguity, omission, defect or inconsistency, so long as such
amendment, modification or supplement does not adversely affect the rights of
any Lender or any Issuing Bank.

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

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

(ii)           waive, reduce or postpone any
scheduled repayment (but not prepayment);

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

(iv)          reduce the rate of interest on any
Loan (other than any waiver of any increase in the interest rate applicable to
any Loan pursuant to Section 2.9) or any fee or any premium payable hereunder;

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

(vi)          reduce the principal amount of any
Loan or any Reimbursement Obligation;

(vii)         amend Section 2.16 or
Section 2.23;

(viii)        amend this Section 10.5 or the
definition of “Requisite Lenders,” “Supermajority Lenders” or “Pro Rata Share”;
provided, with the consent of Requisite Lenders or Supermajority
Lenders, as applicable, additional extensions of credit pursuant hereto may be
included in the determination of “Requisite Lenders,” “Supermajority Lenders”
or “Pro Rata Share” on substantially the same basis as the Revolving
Commitments and the Revolving Loans are included on the Closing Date;

(ix)           release all or substantially all of
the Collateral or any Guarantor (other than any Guarantor that constitutes an
Immaterial Subsidiary) from the Guaranty except as expressly provided in the
Credit Documents;

(x)            consent to the assignment or
transfer by any Credit Party of any of its rights and obligations under any
Credit Document; or

(xi)           alter the order of priority of
application of proceeds set forth in Section 2.15(i).

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

(i)            increase any Revolving Commitment of
any Lender over the amount thereof then in effect without the consent of such
Lender in addition to the consent of Requisite Lenders and the Administrative
Agent (it being understood that none of (i) a waiver of any condition precedent
set forth in Section 3.2, (ii) the waiver of any Default, mandatory
prepayment or mandatory 

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reduction of
the Commitments and (iii) the making of any Protective Advance in accordance
herewith shall constitute an extension or increase of any Commitment of any
Lender);

(ii)           amend, modify, terminate or waive any
provision hereof relating to the Swing Line Sublimit or the Swing Line Loans
without the consent of Swing Line Lender in addition to the consent of
Requisite Lenders and the Administrative Agent;

(iii)          amend, modify, terminate or waive any
obligation of Lenders relating to the purchase of participations in Letters of
Credit as provided in Section 2.3 without the written consent of the
Administrative Agent, the Requisite Lenders and each Issuing Bank;

(iv)          amend, modify, terminate or waive any
provision of Section 9 as the same applies to any Facility Agent, or any other
provision hereof as the same applies to the rights or obligations of any
Facility Agent, in each case without the consent of such Facility Agent in addition
to the consent of Requisite Lenders and the Administrative Agent; or

(v)           amend the definition of Borrowing
Base, Eligible Receivables or Eligible Inventory without the written consent of
the Supermajority Lenders.

(d)           Execution
of Amendments, etc.  Administrative
Agent may, but shall have no obligation to, with the concurrence of any Lender,
execute amendments, modifications, waivers or consents on behalf of such Lender.  Any waiver or consent shall be effective only
in the specific instance and for the specific purpose for which it was
given.  No notice to or demand on any
Credit Party in any case shall entitle any Credit Party to any other or further
notice or demand in similar or other circumstances.  Any amendment, modification, termination,
waiver or consent effected in accordance with this Section 10.5 shall be
binding upon each Lender at the time outstanding, each future Lender and, if
signed by a Credit Party, on such Credit Party.

10.6         Successors
and Assigns; Participations.

(a)           Generally.  This Agreement shall be binding upon the
parties hereto and their respective successors and assigns and shall inure to
the benefit of the parties hereto and the successors and assigns of
Lenders.  No Credit Party’s rights or
obligations hereunder nor any interest therein may be assigned or delegated by
any Credit Party without the prior written consent of all Lenders.  Nothing in this Agreement, expressed or
implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby and, to the
extent expressly contemplated hereby, Affiliates of each of the Agents and
Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.

(b)           Register.  The Borrower, Administrative Agent and
Lenders shall deem and treat the Persons listed as Lenders in the Register as
the holders and owners of the corresponding Revolving Commitments and Loans
listed therein for all purposes hereof, and no assignment or transfer of any
such Revolving Commitment or Loan shall be effective, in each case, unless and
until recorded in the Register following receipt of an Assignment Agreement effecting
the assignment or transfer thereof as provided in Section 10.6(d), together
with any Revolving Loan Note (if the assigning Lender’s Loans are evidenced by
a Revolving Loan Note) subject to such assignment.  Each assignment shall be recorded in the
Register on the Business Day the Assignment Agreement is received by the
Administrative Agent, if received by 12:00 noon New York City time, and on the
following Business Day if received after such time, prompt notice thereof shall
be provided to the Borrower and a copy of such Assignment Agreement shall be
maintained.  The date of such recordation
of a transfer shall be referred to herein as the “Assignment Effective Date.” 
Any request, authority or consent of any Person who, at the time of
making such request 

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or giving such authority or consent, is listed in the Register as a
Lender shall be conclusive and binding on any subsequent holder, assignee or
transferee of the corresponding Revolving Commitments or Loans.

(c)           Right
to Assign.  Each Lender shall have
the right at any time to sell, assign or transfer all or a portion of its
rights and obligations under this Agreement, including, without limitation, all
or a portion of its Revolving Commitment or Loans owing to it or other
Obligations (with, in all cases other than assignments by or to a Facility
Agent or an Affiliate of a Facility Agent, the consent of the Issuing Banks and
the Swing Line Lender in addition to the consents required below):

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

(ii)           to any Person meeting the criteria of
clause (ii) of the definition of the term of “Eligible Assignee” upon giving of
notice to the Borrower and Administrative Agent and (except in the case of
assignments made by or to any Facility Agent or their respective Affiliates),
consented to by the Borrower, the Administrative Agent and each Issuing Bank
(such consent not to be (x) unreasonably withheld or delayed or, (y) in the
case of the Borrower, required in connection with the primary syndication or at
any time a Default exists); provided, further, each such assignment
pursuant to this Section 10.6(c)(ii) shall be in an aggregate amount of not
less than $5,000,000 or integral multiples of $1,000,000 in excess thereof (or
such lesser amount as may be agreed to by the Borrower and Administrative Agent
or as shall constitute the aggregate amount of the Revolving Commitments and
Revolving Loans of the assigning Lender) with respect to the assignment of the
Revolving Commitments and Revolving Loans.

(d)           Mechanics.  Assignments and assumptions of Revolving
Loans and Revolving Commitments shall only be effected by manual execution and
delivery to the Administrative Agent of an Assignment Agreement.  Such assignments shall cover the same
percentage of such Lenders Revolving Commitments and Revolving Credit
Exposure.  Assignments made pursuant to
the foregoing provision shall be effective as of the Assignment Effective
Date.  In connection with all assignments
there shall be delivered to Administrative Agent such forms, certificates or
other evidence, if any, with respect to United States federal income tax
withholding matters as the assignee under such Assignment Agreement may be
required to deliver pursuant to Section 2.19(c).  On and after the applicable Assignment
Effective Date, the applicable assignee shall be entitled to receive all
interest paid or payable with respect to the assigned Term Loan, whether such
interest accrued before or after the applicable Assignment Effective Date.

(e)           Representations
and Warranties of Assignee.  Each
Lender, upon execution and delivery hereof or upon succeeding to an interest in
the Revolving Commitments and Loans, as the case may be, represents and
warrants as of the Closing Date or as of the Assignment Effective Date that (i)
it is an Eligible Assignee; (ii) it has experience and expertise in the making
of or investing in commitments or loans such as the applicable Revolving
Commitments or Loans, as the case may be; and (iii) it will make or invest in,
as the case may be, its Revolving Commitments or Loans for its own account in
the ordinary course of its business and without a view to distribution of such
Revolving Commitments or Loans within the meaning of the Securities Act or the
Exchange Act or other federal securities laws (it being understood that,
subject to the provisions of this Section 10.6, the disposition of such Revolving
Commitments or Loans or any interests therein shall at all times remain within
its exclusive control).

(f)            Effect
of Assignment.  On and after the
applicable Assignment Effective Date, upon the recording of such Assignment
Agreement in the Register and the receipt by the Administrative Agent from the
assignee of an assignment fee in the amount of $3,500, (i) the assignee
thereunder shall become a party hereto and, to the extent that rights and
obligations under the Credit Documents have been assigned to such assignee
pursuant to such Assignment Agreement, have the rights and obligations of a 

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Lender and, if such Lender were an Issuing Bank, of such Issuing Bank
hereunder and thereunder, (ii) the Revolving Loan Notes (if any) corresponding
to the Loans assigned thereby shall be transferred to such assignee by notation
in the Register and (iii) the assignor thereunder shall, to the extent that
rights and obligations under this Agreement have been assigned by it pursuant
to such Assignment and Assumption, relinquish its rights (except for those
surviving the payment in full of the Obligations) and be released from its
obligations under the Credit Documents, other than those relating to events or
circumstances occurring prior to such assignment (and, in the case of an
Assignment and Assumption covering all or the remaining portion of an assigning
Lender’s rights and obligations under the Credit Documents, such Lender shall
cease to be a party hereto) relinquish its rights (except for those surviving
the payment in full of the Obligations) and be released from its obligations
under the Credit Documents, other than those relating to events or circumstances
occurring prior to such assignment (and, in the case of an Assignment and
Assumption covering all or the remaining portion of an assigning Lender’s
rights and obligations under the Credit Documents, such Lender shall cease to
be a party hereto).

(g)           Participations.  Each Lender shall have the right at any time
to sell one or more participations to any Person (other than the Borrower, any
of its Subsidiaries or any of its Affiliates) in all or any part of its
Revolving Commitments, Loans or in any other Obligation.  The holder of any such participation, other
than an Affiliate of the Lender granting such participation, shall not be entitled
to require such Lender to take or omit to take any action hereunder except with
respect to any amendment, modification or waiver that would (i) extend the
final scheduled maturity of any Loan, Note or Letter of Credit (unless such
Letter of Credit is not extended beyond the Revolving Commitment Termination
Date) in which such participant is participating, or reduce the rate or extend
the time of payment of interest or fees thereon (except in connection with a
waiver of applicability of any post-default increase in interest rates) or
reduce the principal amount thereof, or increase the amount of the participant’s
participation over the amount thereof then in effect (it being understood that
a waiver of any Default or Event of Default or of a mandatory reduction in the
Revolving Commitment shall not constitute a change in the terms of such participation,
and that an increase in any Revolving Commitment or Loan shall be permitted
without the consent of any participant if the participant’s participation is
not increased as a result thereof), (ii) consent to the assignment or transfer
by any Credit Party of any of its rights and obligations under this Agreement
or (iii) release all or substantially all of the Collateral under the Collateral
Documents (except as expressly provided in the Credit Documents) supporting the
Loans hereunder in which such participant is participating. Each Lender that sells a
participation shall, acting solely for this purpose as a non-fiduciary agent of
Borrower, maintain a register on which it enters the name and address of each participant and the principal amounts
of each participant’s interest
in the Loans held by it (the “Participant Register”).  The entries in the Participant Register shall
be conclusive, absent manifest error, and such Lender shall treat each Person
whose name is recorded in the Participant Register as the owner of such Loan or
other obligation hereunder as the owner thereof for all purposes of this
Agreement notwithstanding any notice to the contrary.

(h)           Participant’s Right.   The
Borrower agrees that each participant shall be entitled to the benefits of
Sections 2.17(d), 2.18 and 2.19 (subject
to the requirements and limitations of those sections) to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to clause (c) of this Section; provided, a participant shall
not be entitled to receive any greater payment under Section 2.18 or 2.19 than
the applicable Lender would have been entitled to receive with respect to the
participation sold to such participant except to the extent that the
entitlement to any greater payment results from any change in law
after the participant becomes a participant.

(i)            Certain
Other Assignments.  In addition to
any other assignment permitted pursuant to this Section 10.6, any Lender may
assign and/or pledge all or any portion of its Loans, the other Obligations
owed by or to such Lender, and its Notes, if any, to secure obligations of such
Lender including, without limitation, any Federal Reserve Bank as collateral
security pursuant to Regulation A of the Board 

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of Governors of the Federal Reserve System and any operating circular
issued by such Federal Reserve Bank; provided, no Lender, as between the
Borrower and such Lender, shall be relieved of any of its obligations hereunder
as a result of any such assignment and pledge, and provided  further,
in no event shall the applicable Federal Reserve Bank, pledgee or trustee be
considered to be a “Lender” or be entitled to require the assigning Lender to
take or omit to take any action hereunder. 
To the extent permitted by law, each participant also shall be entitled
to the benefits of Section 10.4 as though it were a Lender, provided
such Participant agrees to be subject to Section 2.16 as though it were a
Lender.

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

10.8         Survival
of Representations, Warranties and Agreements.  All representations, warranties and
agreements made herein shall survive the execution and delivery hereof and the
making of any Credit Extension. 
Notwithstanding anything herein or implied by law to the contrary, the
agreements of each Credit Party set forth in Sections 2.17(d), 2.18, 2.19,
10.2, 10.3 and 10.4 and the agreements of Lenders set forth in
Sections 2.16, 9.3(b) and 9.6 shall survive the payment of the Loans, the
cancellation or expiration of the Letters of Credit and the payment of any Reimbursement
Obligations, and the termination hereof.

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

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

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

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

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

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

10.15       Consent
to Jurisdiction; Service of Process. 
Any legal action or proceeding with respect to this Agreement or any
other Credit Document may be brought in the courts of the State of New York
located in the City of New York or of the United States of America for the
Southern District of New York, and, by execution and delivery of this Agreement,
the each Credit Party and each other party hereto hereby accepts for itself and
in respect of its property, generally and unconditionally, the non-exclusive
jurisdiction of the aforesaid courts. 
The parties hereto hereby irrevocably waive any objection, including any
objection to the laying of venue or based on the grounds of forum non
conveniens, that any of them may now or hereafter have to the bringing of any
such action or proceeding in such respective jurisdictions.  By executing and delivering this agreement,
each Credit Party agrees that (i) service of all process in any such proceeding
in any such court may be made by registered or certified mail, return receipt requested,
to the applicable Credit Party at its address provided in accordance with
section 10.1, (ii) service as provided in accordance with the preceding clause
(i) is sufficient to confer personal jurisdiction over the applicable Credit
Party in any such proceeding in any such court, and otherwise constitutes
effective and binding service in every respect and (iii) the Facility Agents,
the Lenders and the Issuing Banks retain the right to serve process in any
other manner permitted by law or to bring proceedings against any Credit Party
in the courts of any other jurisdiction.

10.16       WAIVER
OF JURY TRIAL.  EACH OF THE PARTIES
HERETO HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY
CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING HEREUNDER OR UNDER ANY OF THE
OTHER CREDIT DOCUMENTS OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT
MATTER OF THIS LOAN TRANSACTION OR THE LENDER/BORROWER RELATIONSHIP THAT IS
BEING ESTABLISHED.  THE SCOPE OF THIS
WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT
MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION,
INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER
COMMON LAW AND STATUTORY CLAIMS.  EACH
PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER
INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THIS WAIVER IN
ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS
WAIVER IN ITS RELATED FUTURE DEALINGS. 
EACH PARTY HERETO FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED
THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES
ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.  

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THIS WAIVER IS IRREVOCABLE, MEANING THAT IT
MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN
WAIVER SPECIFICALLY REFERRING TO THIS SECTION 10.16 AND EXECUTED BY EACH OF THE
PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO OR ANY OF THE OTHER CREDIT
DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE
HEREUNDER.  IN THE EVENT OF LITIGATION,
THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

10.17       Confidentiality.  Each Lender shall hold all non-public
information regarding the Borrower and its Subsidiaries and their businesses
identified as such by the Borrower and obtained by such Lender pursuant to the
requirements hereof in accordance with such Lender’s customary procedures for
handling confidential information of such nature, it being understood and
agreed by each Credit Party that, in any event, a Lender may make (i)
disclosures of such information to Affiliates of such Lender and to their
agents and advisors (and to other persons authorized by a Lender or Agent to
organize, present or disseminate such information in connection with
disclosures otherwise made in accordance with this Section 10.17), (ii)
disclosures of such information reasonably required by any bona fide or
potential assignee, transferee or participant in connection with the
contemplated assignment, transfer or participation by such Lender of any Loans
or any participations therein or by any direct or indirect contractual
counterparties (or the professional advisors thereto) in Related Obligation
Documents (provided, such counterparties and advisors are advised of and
agree to be bound by the provisions of this Section 10.17),
(iii) disclosure to any rating agency when required by it, provided
that, prior to any disclosure, such rating agency shall undertake in writing to
preserve the confidentiality of any confidential information relating to the
Credit Parties received by it from any of the Facility Agents or any Lender,
and (iv) disclosures required or requested by any governmental agency or representative
thereof or by the NAIC or pursuant to legal or judicial process; provided,
unless specifically prohibited by applicable law or court order, each Lender
shall make reasonable efforts to notify the Borrower of any request by any
governmental agency or representative thereof (other than any such request in
connection with any examination of the financial condition or other routine
examination of such Lender by such governmental agency) for disclosure of any
such non-public information prior to disclosure of such information.

10.18       Entire
Agreement.  This Agreement,
together with all of the other Credit Documents and all certificates and documents
delivered hereunder or thereunder, embodies the entire agreement of the parties
and supersedes all prior agreements and understandings relating to the subject matter
hereof.  In the event of any conflict
between the terms of this Agreement and any other Credit Document (other than
the Intercreditor Agreement), the terms of this Agreement shall govern.  This Agreement and each other Credit Document
are subject to the terms and conditions set forth in the Intercreditor
Agreement in all respects and, in the event of any conflict between the terms
of the Intercreditor Agreement and this Agreement or any other Credit Document,
the terms of Intercreditor Agreement shall govern.

10.19       Counterparts.  This Agreement may be executed in any number
of counterparts, each of which when so executed and delivered shall be deemed
an original, but all such counterparts together shall constitute but one and
the same instrument.  Signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are attached to the same document.  Delivery of an executed signature page of
this Agreement by facsimile transmission, electronic mail or by posting on the
Platform shall be as effective as delivery of a manually executed counterpart
hereof.  A set of the copies of this
Agreement signed by all parties shall be lodged with the Borrower and the
Administrative Agent.

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

10.21       Patriot
Act.  Each Lender and
Administrative Agent (for itself and not on behalf of any Lender) hereby notifies
the Borrower that pursuant to the requirements of the Patriot Act, it is required
to obtain, verify and record information that identifies the Borrower, which
information includes the name and address of the Borrower and other information
that will allow such Lender or the Administrative Agent, as applicable, to
identify the Borrower in accordance with the Patriot Act.

10.22       Electronic
Execution of Assignments.  The
words “execution,” “signed,” “signature,” and words of like import in any
Assignment Agreement shall be deemed to include electronic signatures or the
keeping of records in electronic form, each of which shall be of the same legal
effect, validity or enforceability as a manually executed signature or the use
of a paper-based recordkeeping system, as the case may be, to the extent and as
provided for in any applicable law, including the Federal Electronic Signatures
in Global and National Commerce Act, the New York State Electronic Signatures
and Records Act, or any other similar state laws based on the Uniform
Electronic Transactions Act.

10.23       Reinstatement.  This Agreement shall continue to be
effective, or be reinstated, as the case may be, if at any time payment, or any
part thereof, of any of the Obligations is rescinded or must otherwise be
restored or returned by the Administrative Agent or any other Secured Party
upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of
the Borrower or any Subsidiary, or upon or as a result of the appointment of a
receiver, intervenor or conservator of, or trustee or similar officer for, any
Borrower or any substantial part of its property, or otherwise, all as though
such payments had not been made.

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

	
  

  	
   

  	
  SOURCE
  INTERLINK COMPANIES, INC., as the

  Borrower

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [Each of the Guarantors], as a
  Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  

 B-1
 

 

	
  

  	
   

  	
  CITICORP
  NORTH AMERICA, INC., as 

  Administrative Agent, Collateral Agent, Swing Line 

  Lender and Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  CITIBANK, N.A., as an Issuing
  Bank

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  

 

 B-2

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