Document:

Exhibit 10.1

EXECUTION VERSION

 

AMENDED AND RESTATED

FIVE YEAR CREDIT AGREEMENT

dated as of

September 29, 2006

among

EDWARDS LIFESCIENCES CORPORATION

as Borrower

The Lenders Party Hereto

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

J.P. MORGAN EUROPE LIMITED

as London Agent

MIZUHO CORPORATE BANK, LTD.

as Tokyo Agent

BANK OF AMERICA, N.A.

as Syndication Agent

and

THE BANK OF TOKYO – MITSUBISHI UFJ, LTD.

MIZUHO CORPORATE BANK, LTD.

SUNTRUST BANK

WACHOVIA BANK, N.A.

as Documentation Agents

J.P.MORGAN SECURITIES INC. and BANC OF AMERICA
SECURITIES LLC

as Joint Lead Arrangers and Joint Bookrunners

 

 

TABLE OF CONTENTS

	
  

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE I

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Definitions

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 1.01.

  	
  Defined Terms

  	
   

  	
  2

  
	
  SECTION 1.02.

  	
  Classification of Loans and Borrowings

  	
   

  	
  21

  
	
  SECTION 1.03.

  	
  Terms Generally

  	
   

  	
  21

  
	
  SECTION 1.04.

  	
  Accounting Terms; GAAP

  	
   

  	
  21

  
	
  SECTION 1.05.

  	
  Exchange Rates

  	
   

  	
  21

  
	
  SECTION 1.06.

  	
  Redenomination of Certain Foreign Currencies

  	
   

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  The Credits

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 2.01.

  	
  Commitments

  	
   

  	
  22

  
	
  SECTION 2.02.

  	
  Loans and Borrowings

  	
   

  	
  23

  
	
  SECTION 2.03.

  	
  Requests for Revolving Borrowings

  	
   

  	
  24

  
	
  SECTION 2.04.

  	
  Competitive Bid Procedure

  	
   

  	
  25

  
	
  SECTION 2.05.

  	
  Letters of Credit

  	
   

  	
  28

  
	
  SECTION 2.06.

  	
  Funding of Borrowings

  	
   

  	
  32

  
	
  SECTION 2.07.

  	
  Repayment of Borrowings; Evidence of Debt

  	
   

  	
  33

  
	
  SECTION 2.08.

  	
  Interest Elections

  	
   

  	
  33

  
	
  SECTION 2.09.

  	
  Termination and Reduction of Commitments

  	
   

  	
  35

  
	
  SECTION 2.10.

  	
  Increase in Commitments

  	
   

  	
  36

  
	
  SECTION 2.11.

  	
  Prepayment of Loans

  	
   

  	
  38

  
	
  SECTION 2.12.

  	
  Fees

  	
   

  	
  39

  
	
  SECTION 2.13.

  	
  Interest

  	
   

  	
  40

  
	
  SECTION 2.14.

  	
  Alternate Rate of Interest

  	
   

  	
  41

  
	
  SECTION 2.15.

  	
  Increased Costs

  	
   

  	
  42

  
	
  SECTION 2.16.

  	
  Break Funding Payments

  	
   

  	
  43

  
	
  SECTION 2.17.

  	
  Taxes

  	
   

  	
  44

  
	
  SECTION 2.18.

  	
  Payments Generally; Pro Rata Treatment; Sharing of
  Setoffs

  	
   

  	
  45

  
	
  SECTION 2.19.

  	
  Mitigation Obligations; Replacement of Lenders

  	
   

  	
  47

  
	
  SECTION 2.20.

  	
  Designation of US Borrowers, Swiss Borrowers and
  Japanese Borrowers

  	
   

  	
  47

  

 

 ii
 

 

 

	
  ARTICLE III

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Representations
  and Warranties

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3.01.

  	
  Corporate Existence and Standing

  	
   

  	
  48

  
	
  SECTION 3.02.

  	
  Authorization; No Violation

  	
   

  	
  48

  
	
  SECTION 3.03.

  	
  Governmental Consents

  	
   

  	
  48

  
	
  SECTION 3.04.

  	
  Validity

  	
   

  	
  48

  
	
  SECTION 3.05.

  	
  Litigation

  	
   

  	
  49

  
	
  SECTION 3.06.

  	
  Financial Statements; No Material Adverse Change

  	
   

  	
  49

  
	
  SECTION 3.07.

  	
  Investment Company Act

  	
   

  	
  49

  
	
  SECTION 3.08.

  	
  Regulation U

  	
   

  	
  49

  
	
  SECTION 3.09.

  	
  Environmental Matters

  	
   

  	
  49

  
	
  SECTION 3.10.

  	
  Disclosure

  	
   

  	
  49

  
	
  SECTION 3.11.

  	
  Subsidiary Guarantors

  	
   

  	
  50

  
	
  SECTION 3.12.

  	
  Solvency

  	
   

  	
  50

  
	
  SECTION 3.13.

  	
  Limitation of Debt from Lenders that are not
  Qualifying Banks

  	
   

  	
  50

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Conditions

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4.01.

  	
  Effective Date

  	
   

  	
  50

  
	
  SECTION 4.02.

  	
  Each Credit Event

  	
   

  	
  52

  
	
  SECTION 4.03.

  	
  Initial Credit Event in Respect of each Borrower
  that is not a Borrower on the Effective Date

  	
   

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Affirmative
  Covenants

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5.01.

  	
  Payment of Taxes, Etc

  	
   

  	
  53

  
	
  SECTION 5.02.

  	
  Maintenance of Insurance

  	
   

  	
  53

  
	
  SECTION 5.03.

  	
  Preservation of Existence, Etc

  	
   

  	
  53

  
	
  SECTION 5.04.

  	
  Compliance with Laws, Etc

  	
   

  	
  53

  
	
  SECTION 5.05.

  	
  Keeping of Books

  	
   

  	
  53

  
	
  SECTION 5.06.

  	
  Inspection

  	
   

  	
  53

  
	
  SECTION 5.07.

  	
  Reporting Requirements

  	
   

  	
  54

  
	
  SECTION 5.08.

  	
  Use of Proceeds and Letters of Credit

  	
   

  	
  55

  
	
  SECTION 5.09.

  	
  Guarantee Requirement

  	
   

  	
  55

  
	
  SECTION 5.10.

  	
  Limitation of Debt From Lenders That Are Not
  Qualifying Banks

  	
   

  	
  55

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Negative
  Covenants

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6.01.

  	
  Subsidiary Debt

  	
   

  	
  56

  

 

 iii
 

 

 

	
  SECTION
  6.02.

  	
  Liens, Etc

  	
   

  	
  56

  
	
  SECTION 6.03.

  	
  Sale and Leaseback Transactions

  	
   

  	
  59

  
	
  SECTION 6.04.

  	
  Merger, Etc

  	
   

  	
  59

  
	
  SECTION 6.05.

  	
  Change in Business

  	
   

  	
  60

  
	
  SECTION 6.06.

  	
  Certain Restrictive Agreements

  	
   

  	
  60

  
	
  SECTION 6.07.

  	
  Leverage Ratio

  	
   

  	
  60

  
	
  SECTION 6.08.

  	
  Interest Coverage Ratio

  	
   

  	
  60

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Events of
  Default

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  The Agents

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Collection
  Allocation Mechanism

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Guarantee

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XI

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Miscellaneous

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 11.01.

  	
  Notices

  	
   

  	
  68

  
	
  SECTION 11.02.

  	
  Waivers; Amendments

  	
   

  	
  69

  
	
  SECTION 11.03.

  	
  Expenses; Indemnity; Damage Waiver

  	
   

  	
  70

  
	
  SECTION 11.04.

  	
  Successors and Assigns

  	
   

  	
  71

  
	
  SECTION 11.05.

  	
  Survival

  	
   

  	
  74

  
	
  SECTION 11.06.

  	
  Counterparts; Integration; Effectiveness

  	
   

  	
  74

  
	
  SECTION 11.07.

  	
  Severability

  	
   

  	
  74

  
	
  SECTION 11.08.

  	
  Right of Setoff

  	
   

  	
  75

  
	
  SECTION 11.09.

  	
  Governing Law; Jurisdiction; Consent to Service of
  Process

  	
   

  	
  75

  
	
  SECTION 11.10.

  	
  WAIVER OF JURY TRIAL

  	
   

  	
  76

  
	
  SECTION 11.11.

  	
  Headings

  	
   

  	
  76

  
	
  SECTION 11.12.

  	
  Confidentiality

  	
   

  	
  76

  
	
  SECTION 11.13.

  	
  Conversion of Currencies

  	
   

  	
  77

  

 

 iv
 

 

 

	
  SECTION 11.14.

  	
  Termination of Covenants

  	
   

  	
  78

  
	
  SECTION 11.15.

  	
  Release of Guarantors

  	
   

  	
  78

  
	
  SECTION 11.16.

  	
  USA PATRIOT Act

  	
   

  	
  78

  
	
  SECTION 11.17.

  	
  Qualifying Bank Representation and Warranty

  	
   

  	
  78

  
	
  SECTION 11.18.

  	
  No Fiduciary Duty

  	
   

  	
  78

  
	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULES:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Schedule 1.01

  	
  — Subsidiary Guarantors

  	
   

  	
   

  
	
  Schedule 2.01

  	
  — Lenders and Commitments

  	
   

  	
   

  
	
  Schedule 2.18

  	
  — Payment Instructions

  	
   

  	
   

  
	
  Schedule 6.01

  	
  — Debt of Material Subsidiaries

  	
   

  	
   

  
	
  Schedule 6.02

  	
  — Security Interests

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  EXHIBITS:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit A-1

  	
  — Form of Borrowing Subsidiary Agreement

  	
   

  	
   

  
	
  Exhibit A-2

  	
  — Form of Borrowing Subsidiary Termination

  	
   

  	
   

  
	
  Exhibit B

  	
  — Form of Assignment and Acceptance

  	
   

  	
   

  
	
  Exhibit C

  	
  — Form of Subsidiary Guarantee Agreement

  	
   

  	
   

  
	
  Exhibit D

  	
  — Form of Indemnity, Subrogation and Contribution
  Agreement

  	
   

  	
   

  
	
  Exhibit E-1

  	
  — Form of Opinion of Counsel for the Company

  	
   

  	
   

  
	
  Exhibit E-2

  	
  — Form of Opinion of Associate General Counsel of
  the Company

  	
   

  	
   

  
					

 

 v

AMENDED AND RESTATED FIVE
YEAR CREDIT AGREEMENT dated as of September 29, 2006, among EDWARDS
LIFESCIENCES CORPORATION, a Delaware corporation (the “Company”); the US
BORROWERS (as defined herein); the SWISS BORROWERS (as defined herein); the
JAPANESE BORROWERS (as defined herein) (the Company, the US Borrowers, the
Swiss Borrowers and the Japanese Borrowers being collectively called the
“Borrowers”); the LENDERS from time to time party hereto; JPMORGAN CHASE BANK,
N.A., as Administrative Agent; J.P. MORGAN EUROPE LIMITED, as London Agent;
MIZUHO CORPORATE BANK, LTD., as the Tokyo Agent; BANK OF AMERICA, N.A., as
Syndication Agent; and THE BANK OF TOKYO — MITSUBISHI UFJ, LTD., MIZUHO
CORPORATE BANK, LTD., SUNTRUST BANK and WACHOVIA BANK, N.A., each as Documentation
Agent.

The Company has requested that the Existing Credit
Agreement (such term and each other capitalized term used and not otherwise
defined herein having the meaning assigned to it in Article I) be amended
and restated and that the Lenders extend credit in the form of (a) US
Tranche Commitments under which the US Borrowers may obtain Loans in US Dollars
and one or more Designated Foreign Currencies in an aggregate principal amount
at any time outstanding that will not result in the sum of the US Tranche
Revolving Exposures and the Competitive Loan Exposures exceeding $250,000,000,
(b) Swiss Tranche Commitments under which the Swiss Borrowers may obtain
Loans in Swiss Francs or Euros and the US Borrowers may obtain Loans in US
Dollars in an aggregate principal amount at any time outstanding that will not
result in the Swiss Tranche Exposure exceeding $150,000,000, (c) Japanese
Tranche Commitments under which the Japanese Borrowers may obtain Loans in Yen
and the US Borrowers may obtain Loans in US Dollars in an aggregate principal
amount at any time outstanding that will not result in the Japanese Tranche
Exposure exceeding $100,000,000 and (d) Letters of Credit in US Dollars in
an aggregate stated amount at any time outstanding up to $25,000,000.  The Company has also requested the Lenders to
provide a procedure pursuant to which the Borrowers may invite the Lenders to
bid on an uncommitted basis on short-term Loans to the Borrowers.  The proceeds of borrowings hereunder and the
Letters of Credit issued hereunder will be used for general corporate purposes
of the Borrowers and their subsidiaries.

The Lenders are
willing to amend and restate the Existing Credit Agreement and to provide the
credit facilities referred to in the preceding paragraph upon the terms and
subject to the conditions set forth herein. 
Accordingly, the parties hereto agree as follows:

 

ARTICLE I

Definitions

SECTION 1.01.  Defined Terms.  As used in this Agreement, the following
terms have the meanings specified below:

“ABR”, when used in reference to any Loan or
Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing,
are bearing interest at a rate determined by reference to the Alternate Base
Rate.

“Administrative Agent” means JPMorgan Chase
Bank, N.A., in its capacity as administrative agent for the Lenders hereunder.

“Administrative Questionnaire” means an
Administrative Questionnaire in a form supplied by the Administrative Agent.

“Affiliate” means, with respect to a specified
Person, another Person that directly, or indirectly through one or more
intermediaries, Controls or is Controlled by or is under common Control with
the Person specified.

“Agents” means, collectively, the
Administrative Agent, the London Agent and the Tokyo Agent.

“Agreement Currency” has the meaning assigned
to such term in Section 11.13(b).

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

“Applicable Agent” means (a) with respect
to a Loan, Borrowing or Letter of Credit denominated in US Dollars, and with
respect to any payment hereunder that does not relate to a particular Loan or
Borrowing, the Administrative Agent, (b) with respect to a Eurocurrency or
Fixed Rate Loan or Eurocurrency or Fixed Rate Borrowing denominated in any
Designated Foreign Currency, the London Agent and (c) with respect to a
TIBOR or Yen Base Rate Revolving Loan or Borrowing, the Tokyo Agent.

“Applicable
Rate” means, for any day, with respect to (i) any Loan of any Type or
(ii) the facility fees payable hereunder, as the case may be, the
applicable rate per annum set forth under the appropriate caption in the table
below, based upon the Leverage Ratio as of the most recent determination date:

 2
 

 

 

	
  Category

  	
   

  	
  Leverage

  Ratio

  	
   

  	
  Facility

  Fee (basis

  points per

  annum)

  	
   

  	
  LIBOR/TIBOR/

  Yen Base Rate

  Spread (basis

  points per

  annum)

  	
   

  	
  ABR Spread

  (basis points

  per annum)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Category 1

  	
   

  	
  <
  1.00

  	
   

  	
  7.5

  	
   

  	
  32.5

  	
   

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Category 2

  	
   

  	
  >
  1.00 and < 2.00

  	
   

  	
  8.0

  	
   

  	
  37.0

  	
   

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Category 3

  	
   

  	
  >
  2.00 and < 2.50

  	
   

  	
  10.0

  	
   

  	
  52.5

  	
   

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Category 4

  	
   

  	
  >
  2.50

  	
   

  	
  12.5

  	
   

  	
  62.5

  	
   

  	
  0

  	
   

  

Except as set forth
below, the Leverage Ratio used on any date to determine the Applicable Rate
shall be that in effect at the end of the most recent fiscal quarter for which
financial statements shall have been delivered pursuant to Section 5.07(a)
or (b); provided that if any financial statements required to have been
delivered under Section 5.07(a) or (b) shall not at any time have been
delivered, the Applicable Rate shall, until such financial statements shall
have been delivered, be determined by reference to Category 4 in the Table
above.

“Assignment and Acceptance” means an assignment
and acceptance entered into by a Lender and an assignee (with the consent of
any party whose consent is required by Section 11.04), and accepted by the
Administrative Agent, in the form of Exhibit B or any other form approved
by the Administrative Agent.

“Attributable Debt” means, in connection with
any Sale and Leaseback Transaction, the present value (discounted in accordance
with GAAP at the discount rate implied in the lease) of the obligations of the
lessee for rental payments during the term of the lease.

“Board” means the Board of Governors of the
Federal Reserve System of the United States of America.

“Borrower” means the Company, any other US
Borrower, any Swiss Borrower or any Japanese Borrower.

“Borrowing” means Loans (including one or more
Competitive Loans) of the same Class, Type and currency, made, converted or
continued on the same date and, in the case of Eurocurrency Loans, TIBOR Loans
or Fixed Rate Loans, as to which a single Interest Period is in effect.

“Borrowing Minimum” means (a) in the case of a
Borrowing denominated in US Dollars, $5,000,000 and (b) in the case of a
Borrowing denominated in any Designated Foreign Currency, the smallest amount
of such Foreign Currency that (i) is an integral multiple of 1,000,000
units (or, in the case of Sterling, 500,000 units) of such currency and
(ii) has a US Dollar Equivalent in excess of $5,000,000.

 3
 

 

“Borrowing Multiple” means (a) in the case
of a Borrowing denominated in US Dollars, $1,000,000 and (b) in the case
of a Borrowing denominated in any Foreign Currency, 1,000,000 units (or, in the
case of Sterling, 500,000 units) of such currency.

“Borrowing Request” means a request by a
Borrower for a Revolving Borrowing in accordance with Section 2.03.

“Borrowing Subsidiary Agreement” means a
Borrowing Subsidiary Agreement substantially in the form of Exhibit A-1.

“Borrowing Subsidiary Termination” means a
Borrowing Subsidiary Termination substantially in the form of Exhibit A-2.

“Business Day” means any day that is not a
Saturday, Sunday or other day on which commercial banks in New York City
are authorized or required by law to remain closed; provided, that
(a) when used in connection with a Eurocurrency Loan or in connection with
a Fixed Rate Loan denominated in a Designated Foreign Currency, the term “Business
Day” shall also exclude any day on which banks are not open for dealings in
deposits in the applicable currency in the London interbank market,
(b) when used in connection with a TIBOR Loan, a Yen Base Rate Loan or a
Eurocurrency or Fixed Rate Loan denominated in a Designated Foreign Currency,
the term “Business Day” shall also exclude any day on which banks are
not open for dealings in deposits in the applicable Designated Foreign Currency
in the principal financial center of the country of such Designated Foreign Currency,
and (c) when used in connection with a Loan denominated in Euro, the term “Business
Day” shall also exclude any day on which the TARGET payment system is not
open for the settlement of payments in Euro.

“Calculation Date” means the last Business Day
of each calendar month.

“CAM” shall mean the mechanism for the
allocation and exchange of interests in the Tranches and collections thereunder
established under Article IX.

“CAM Exchange” shall mean the exchange of the
Lender’s interests provided for in Article IX.

“CAM Exchange Date” shall mean the date on
which any event referred to in paragraph (g) of Article VII shall
occur in respect of the Company.

“CAM Percentage” shall mean, as to each Lender,
a fraction, expressed as a decimal, of which (a) the numerator shall be
the aggregate US Dollar Equivalent (determined on the basis of Exchange Rates
prevailing on the CAM Exchange Date) of the Specified Obligations owed to such
Lender immediately prior to the CAM Exchange Date and (b) the denominator
shall be the aggregate US Dollar Equivalent (as so determined) of the Specified
Obligations owed to all the Lenders immediately prior to such CAM Exchange
Date.

“Change in Control” means (a) the
acquisition of ownership, directly or indirectly, beneficially or of record, by
any Person or group (within the meaning of the

 4
 

 

Securities Exchange Act
of 1934 and the rules of the Securities and Exchange Commission thereunder as
in effect on the date hereof) of shares representing more than 30% of the
aggregate ordinary voting power represented by the issued and outstanding
capital stock of the Company; or (b) occupation of a majority of the seats
(other than vacant seats) on the board of directors of the Company by Persons
who were not (i) directors of the Company on the date hereof,
(ii) nominated by the board of directors of the Company or (iii) appointed
by directors so nominated.

“Change in Law” means (a) the adoption of
any law, rule or regulation after the date of this Agreement, (b) any
change in any law, rule or regulation or in the interpretation or application
thereof by any Governmental Authority after the date of this Agreement or
(c) compliance by any Lender or the Issuing Bank or by any lending office
of such Lender or by such Lender’s or Issuing Bank’s holding company with any
request, guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the date of this Agreement.

“Class”, when used in reference to (a) any
Loan or Borrowing, refers to whether such Loan, or the Loans comprising such
Borrowing, are US Tranche Revolving Loans, Competitive Loans, Swiss Tranche
Revolving Loans or Japanese Tranche Revolving Loans, and (b) any
Commitment, refers to whether such Commitment is a US Tranche Commitment, a
Swiss Tranche Commitment or a Japanese Tranche Commitment.

“Code” means the Internal Revenue Code of 1986,
as amended from time to time.

“Commitment” means a US Tranche Commitment, a
Swiss Tranche Commitment or a Japanese Tranche Commitment.

“Company” has the meaning assigned to such term
in the heading of this Agreement.

“Competitive Bid” means an offer by a Lender to
make a Competitive Loan in accordance with Section 2.04.

“Competitive Bid Rate” means, with respect to
any Competitive Bid, the Margin or the Fixed Rate, as applicable, offered by
the Lender making such Competitive Bid.

“Competitive Bid Request” means a request for
Competitive Bids in accordance with Section 2.04.

“Competitive Borrowing” means a Borrowing
comprised of Competitive Loans.

“Competitive Loan” means a Loan made pursuant
to Section 2.04.  Each Competitive
Loan shall be a Eurocurrency Loan or a Fixed Rate Loan.

 5
 

 

“Competitive Loan Exposure” means, with respect
to any Lender at any time, the sum of (a) the aggregate principal amount
of the outstanding Competitive Loans of such Lender denominated in US Dollars
and (b) the sum of the US Dollar Equivalents of the aggregate principal amounts
of the outstanding Competitive Loans of such Lender denominated in Designated
Foreign Currencies.

“Confidential Information Memorandum” means the
Confidential Information Memorandum dated May 2004 distributed to the
Lenders, together with the appendices thereto, as amended through the date
hereof.

“Consolidated EBITDA” means, for any period,
for the Company and its Subsidiaries on a consolidated basis, an amount equal
to consolidated net income for such period plus (a) the following to the
extent deducted in calculating such consolidated net income: (i) Consolidated
Interest Expense for such period, (ii) the provision for federal, state, local
and foreign income taxes payable by the Company and its Subsidiaries for such
period, (iii) the amount of depreciation and amortization expense deducted in
determining such consolidated net income, (iv) any extraordinary or
non-recurring expenses or losses (to the extent any of the foregoing are
non-cash items), including losses on sales of assets outside the ordinary
course of business, special charges and purchased research and development
charges in connection with acquisitions, but excluding any non-cash charge that
relates to the write-down or write-off of inventory or accounts receivable, and
(v) non-cash charges associated with stock-based compensation expenses pursuant
to the financial reporting guidance of the Financial Accounting Standards Board
concerning stock-based compensation as in effect from time to time; and minus
(b) extraordinary gains increasing consolidated net income for such period.

“Consolidated Interest Expense” means, for any
period, the interest expense of the Company and the consolidated Subsidiaries
for such period determined on a consolidated basis in accordance with GAAP,
including (a) the amortization of debt discounts to the extent included in
interest expense in accordance with GAAP, (b) the amortization of all fees
(including fees with respect to interest rate protection agreements or other
interest rate hedging arrangements) payable in connection with the incurrence
of Debt to the extent included in interest expense in accordance with GAAP and
(c) the portion of any rents payable under capital leases allocable to
interest expense in accordance with GAAP.

“Consolidated Net Tangible Assets” means the
total amount of assets that would be included on a consolidated balance sheet
of the Company and the consolidated Subsidiaries (and which shall reflect the
deduction of applicable reserves) after deducting therefrom all current
liabilities of the Company and the consolidated Subsidiaries and all Intangible
Assets.

“Consolidated Total Assets” means the total
amount of assets that would be included on a consolidated balance sheet of the
Company and the consolidated Subsidiaries.

 6
 

 

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

“Debt” means, without duplication,
(a) indebtedness for borrowed money or for the deferred purchase price of
property or services carried as indebtedness on the consolidated balance sheet
of the Company and the consolidated Subsidiaries (b) obligations of the
Company and the consolidated Subsidiaries as lessee under leases that, in accordance
with GAAP, are recorded as capital leases, (c) obligations of the Company
and the consolidated Subsidiaries under direct or indirect guarantees in
respect of, and obligations (contingent or otherwise) to purchase or otherwise
acquire, or otherwise to assure a creditor against loss in respect of,
indebtedness or obligations of others of the kinds referred to in
clauses (a) and (b) above (including actual or contingent liabilities in
respect of letters of credit issued to support such indebtedness or other obligations),
(d) indebtedness or obligations of the kinds referred to in
clauses (a), (b) and (c) above of the unconsolidated Subsidiaries and
(e) solely for purposes of Article VII hereof, obligations under
interest rate, foreign exchange rate or other hedging agreements.  The term “Debt” shall not include the undrawn
face amount of any letter of credit issued for the account of the Company or
any Subsidiary in the ordinary course of the Company’s or such Subsidiary’s
business (other than any letter of credit referred to in clause (c)
above), but shall include the reimbursement obligation owing from time to time
by the Company or any of the consolidated Subsidiaries in respect of drawings
made under any letter of credit in the event reimbursement is not made
immediately following the applicable drawing. 
For purposes of Article VII, the “principal amount” of the
obligations of the Company or any Subsidiary in respect of any hedging
agreement at any time shall be the maximum aggregate amount (giving effect to
any netting agreements) that the Company or such Subsidiary would be required
to pay if such hedging agreement were terminated at such time.

“Default” means any event or condition which
constitutes an Event of Default or which upon notice, lapse of time or both
would, unless cured or waived, become an Event of Default.

“Designated Amount” means, at any time, the sum
of (a) the aggregate outstanding principal amount at such time of Debt of
Material Subsidiaries (other than Subsidiary Guarantors) that is permitted
under clause (d) of Section 6.01, (b) the aggregate outstanding
investment or claim held at such time by purchasers, assignees or other
transferees of (or of interests in) Receivables sold under clause (iv) of
Section 6.02(l), (c) the aggregate outstanding principal amount at such
time of Secured Debt permitted under the last paragraph of Section 6.02
and (d) the aggregate amount at such time of the Attributable Debt in
respect of Sale and Leaseback Transactions permitted under Section 6.03.

“Designated Foreign Currency” means Euros,
Sterling, Swiss Francs, Yen and any other currency (other than US Dollars)
approved in writing by the US Tranche Lenders that shall be freely traded and
exchangeable into US Dollars in the London

 7
 

 

interbank market, and for
which a LIBO Rate may be determined, at the time of such approval.

“Effective Date” means the date on which the
conditions specified in Section 4.01 are satisfied (or waived in
accordance with Section 11.02).

“EMU Legislation” means the legislative measures
of the European Union for the introduction of, changeover to or operation of
the Euro in one or more member states.

“Environmental Laws” means all federal, state,
local and foreign laws, rules and regulations relating to the release,
emission, disposal, storage and related handling of waste materials, pollutants
and hazardous substances.

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

“Euro” or “E”
means the single currency of the European Union as constituted by the Treaty on
European Union and as referred to in the EMU Legislation.

“Eurocurrency”, when used in reference to any
Loan or Borrowing, refers to whether such Loan, or the Loans comprising such
Borrowing, are bearing interest at a rate determined by reference to the LIBO
Rate.

“Event of Default” has the meaning assigned to
such term in Article VII.

“Exchange Rate” means on any day, with respect
to any Designated Foreign Currency, the rate at which such Designated Foreign
Currency may be exchanged into US Dollars, as set forth at approximately
11:00 a.m., London time, on such day on the Reuters World Currency Page
for such Designated Foreign Currency.  In
the event that such rate does not appear on any Reuters World Currency Page,
the Exchange Rate shall be determined by reference to such other publicly
available service for displaying exchange rates as may be agreed upon by the
Administrative Agent and the Company, or, in the absence of such agreement,
such Exchange Rate shall instead be the arithmetic average of the spot rates of
exchange of the Administrative Agent in the market where its foreign currency
exchange operations in respect of such Designated Foreign Currency are then
being conducted, at or about 10:00 a.m., local time, on such date for the
purchase of US Dollars for delivery two Business Days later; provided
that if at the time of any such determination, for any reason, no such spot
rate is being quoted, the Administrative Agent, after consultation with the
Company, may use any reasonable method it deems appropriate to determine such
rate, and such determination shall be presumed correct absent manifest error.

“Excluded Taxes”
means, with respect to any Lender or the Issuing Bank, (a) income or
franchise taxes imposed on (or measured by) its net income by the United States
of America (or any political subdivision thereof), or by the jurisdiction under
which such recipient is organized or in which its principal office or any
lending office from which it makes Loans hereunder is located, (b) any
branch profit taxes imposed by

 8
 

 

the United States of
America or any similar tax imposed by any other jurisdiction described in
clause (a) above, (c) in the case of a US Tranche Lender (other than a
Lender that becomes a US Tranche Lender by operation of the CAM), any
withholding tax that is imposed by the United States of America (or any
political subdivision thereof) on payments by a US Borrower from an office
within such jurisdiction to the extent such tax is in effect and would
apply as of the date such US Tranche Lender becomes a party to this Agreement
or relates to payments received by a new lending office designated by such US
Tranche Lender and is in effect and would apply at the time such lending office
is designated, (d) in the case of a Swiss Tranche Lender (other than a
Lender that becomes a Swiss Tranche Lender by operation of the CAM), any
withholding tax that is imposed (i) by Switzerland (or any political
subdivision thereof) on payments by a Swiss Borrower from an office within such
jurisdiction or (ii) by the United States of America (or any political
subdivision thereof) on payments by a US Borrower from an office within such
jurisdiction, in either case to the extent such tax is in effect and would
apply as of the date such Swiss Tranche Lender becomes a party to this
Agreement or relates to payments received by a new lending office designated by
such Swiss Tranche Lender and is in effect and would apply at the time such
lending office is designated (assuming the taking by the applicable Borrower,
upon the request of the applicable Swiss Tranche Lender, of all ministerial or
other reasonably requested actions required in order for available exemptions
from such tax to be effective), (e) in the case of a Japanese Tranche
Lender (other than a Lender that becomes a Japanese Tranche Lender by operation
of the CAM), any withholding tax that is imposed (i) by Japan (or any
political subdivision thereof) on payments by a Japanese Borrower from an
office within such jurisdiction or (ii) by the United States of America
(or any political subdivision thereof) on payments by a US Borrower from an
office within such jurisdiction, in either case to the extent such tax is
in effect and would apply as of the date such Japanese Tranche Lender becomes a
party to this Agreement or relates to payments received by a new lending office
designated by such Japanese Tranche Lender and is in effect and would apply at
the time such lending office is designated (assuming the taking by the
applicable Borrower, upon the request of the applicable Japanese Tranche
Lender, of all ministerial or other reasonably requested actions required in
order for available exemptions from such tax to be effective) or (f) any
withholding tax that is attributable to such Lender’s failure to comply
with Section 2.17(e), except, in the case of clause (c), (d) or (e)
above, to the extent that (i) such 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 the applicable Borrower with respect to such
withholding tax pursuant to Section 2.17(a) or (ii) such withholding tax
shall have resulted from the making of any payment to a location other than the
office designated by the Applicable Agent or such Lender for the receipt of
payments of the applicable type from the applicable Borrower.

“Existing
Credit Agreement” means the Five Year Credit Agreement dated as of June 28,
2004, as amended, among the Borrowers, the Lenders, JPMorgan Chase Bank, as
administrative agent, J.P. Morgan Europe Limited, as London Agent, Mizuho
Corporate Bank, Limited, as Tokyo Agent, Bank of America, N.A., as Syndication
Agent, and Bank of Tokyo-Mitsubishi, Limited, Mizuho Corporate Bank, Limited,
Suntrust Bank and Wachovia Bank, as Documentation Agents.

 9
 

 

“Exposure” means, with respect to any Lender,
such Lender’s US Tranche Revolving Exposure, Competitive Loan Exposure, Swiss
Tranche Exposure and Japanese Tranche Exposure.

“Federal Funds Effective Rate” means, for any
day, the weighted average (rounded upwards, if necessary, to the next 1/100 of
1%) of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published on the
next succeeding Business Day by the Federal Reserve Bank of New York, or,
if such rate is not so published for any day that is a Business Day, the
average (rounded upwards, if necessary, to the next 1/100 of 1%) of the
quotations for such day for such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.

“Fixed Rate” means, with respect to any
Competitive Loan (other than a Eurocurrency Competitive Loan), the fixed rate
of interest per annum specified by the Lender making such Competitive Loan in
its related Competitive Bid.

“Fixed Rate Revolving Loan” means a Competitive
Loan bearing interest at a Fixed Rate.

“Foreign Subsidiary” means any Subsidiary that
is not incorporated or otherwise organized under the laws of the United States
or its territories or possessions.

“GAAP” means generally accepted accounting
principles in the United States of America.

“Governmental Authority” means any nation or
government, any federal, state, local or other political subdivision thereof and
any entity exercising executive, legislative, judicial, taxing, regulatory or
administrative functions of or pertaining to government.

“Guarantee Requirement” means, at any time,
that (a) the Subsidiary Guarantee Agreement (or a supplement referred to in
Section 15 thereof) shall have been executed by each Material Subsidiary
(other than any Foreign Subsidiary) existing at such time, shall have been
delivered to the Administrative Agent and shall be in full force and effect and
(b) the Indemnity, Subrogation and Contribution Agreement (or a supplement
referred to in Section 12 thereof) shall have been executed by the Company
and each Subsidiary Guarantor, shall have been delivered to the Administrative
Agent and shall be in full force and effect.

“Indemnified Taxes” means Taxes other than
Excluded Taxes.

“Indemnity,
Subrogation and Contribution Agreement” means an Indemnity, Subrogation and
Contribution Agreement substantially in the form of Exhibit D, made by the
Company and the Subsidiary Guarantors in favor of the Administrative Agent for
the benefit of the Lenders.

 10
 

 

“Initial Borrowing Date” means the date of the
initial Borrowing hereunder.

“Intangible Assets” means all assets of the
Company and the consolidated Subsidiaries that would be treated as intangibles
in conformity with GAAP on a consolidated balance sheet of the Company and the
consolidated Subsidiaries.

“Interest Coverage Ratio” means, for any
period, the ratio of (a) Consolidated EBITDA for such period to
(b) Consolidated Interest Expense for such period.

“Interest Election Request” means a request by
the relevant Borrower to convert or continue a Revolving Borrowing in
accordance with Section 2.08.

“Interest Payment Date” means (a) with
respect to any ABR Loan, the last day of each March, June, September and
December, (b) with respect to any Eurocurrency Loan, TIBOR Loan or Yen
Base Rate Loan, the last day of the Interest Period applicable to the Borrowing
of which such Loan is a part and, in the case of a Eurocurrency Borrowing or TIBOR
Borrowing with an Interest Period of more than three months’ duration, each day
prior to the last day of such Interest Period that occurs at intervals of three
months’ duration after the first day of such Interest Period and (c) with
respect to any Fixed Rate Loan, the last day of the Interest Period applicable
to the Borrowing of which such Loan is a part and, in the case of a Fixed Rate
Borrowing with an Interest Period of more than 90 days’ duration (unless
otherwise specified in the applicable Competitive Bid Request), each day prior
to the last day of such Interest Period that occurs at intervals of
90 days’ duration after the first day of such Interest Period, and any
other dates specified in the applicable Competitive Bid Request as Interest
Payment Dates with respect to such Borrowing.

“Interest Period” means, (i) with respect
to any Eurocurrency Borrowing, Yen Base Rate Borrowing or TIBOR Borrowing, the
period commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is one, two, three or
six months thereafter, as the relevant Borrower may elect and
(ii) with respect to any Fixed Rate Borrowing, the period (which shall not
be less than 7 days or more than 360 days) commencing on the date of
such Borrowing and ending on the date specified in the applicable Competitive
Bid Request; provided that (i) if any Interest Period would end on
a day other than a Business Day, such Interest Period shall be extended to the
next succeeding Business Day unless, in the case of a Eurocurrency Borrowing or
TIBOR Borrowing only, such next succeeding Business Day would fall in the next
calendar month, in which case such Interest Period shall end on the next
preceding Business Day and (ii) any Interest Period pertaining to a
Eurocurrency Borrowing or TIBOR Borrowing that commences on the last Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the last calendar month of such Interest Period) shall end
on the last Business Day of the last calendar month of such Interest
Period.  For purposes hereof, the date of
a Borrowing initially shall be the date on which such Borrowing is made, and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.

 11

 

“Issuing Bank” means JPMorgan Chase Bank, N.A.,
in its capacity as the issuer of Letters of Credit hereunder, and its
successors in such capacity as provided in Section 2.05(i).  The Issuing Bank may, in its discretion,
arrange for one or more Letters of Credit to be issued by Affiliates of the
Issuing Bank, in which case the term “Issuing Bank” shall include any such
Affiliate with respect to Letters of Credit issued by such Affiliate.

“Japanese Borrower” means any Japanese
Subsidiary that has been designated as such pursuant to Section 2.20 and
that has not ceased to be a Japanese Borrower as provided in such Section.

“Japanese Subsidiary” means any Subsidiary that
is incorporated or otherwise organized in Japan.

“Japanese Tranche Commitment” means, with respect
to each Japanese Tranche Lender, the commitment of such Japanese Tranche Lender
to make Japanese Tranche Revolving Loans pursuant to Section 2.01(c),
expressed as an amount representing the maximum aggregate amount of such
Japanese Tranche Lender’s Japanese Tranche Exposure hereunder, as such
commitment may be (a) reduced from time to time pursuant to
Section 2.09 and (b) reduced or increased from time to time pursuant
to assignments by or to such Lender pursuant to Section 11.04.  The initial amount of each Japanese Tranche
Lender’s Japanese Tranche Commitment is set forth on Schedule 2.01, or in
the Assignment and Acceptance pursuant to which Japanese Tranche Lender shall
have assumed its Japanese Tranche Commitment, as applicable.  The aggregate amount of the Japanese Tranche
Commitments on the date hereof is $100,000,000.

“Japanese Tranche Exposure” means, with respect
to any Japanese Tranche Lender at any time, such Lender’s Japanese Tranche
Percentage of the sum of the US Dollar Equivalents of the principal amounts of
the outstanding Japanese Tranche Revolving Loans.

“Japanese Tranche Lender” mean a Lender with a
Japanese Tranche Commitment.

“Japanese Tranche Percentage” means, with
respect to any Japanese Tranche Lender, the percentage of the total Japanese
Tranche Commitments represented by such Lender’s Japanese Tranche
Commitment.  If the Japanese Tranche
Commitments have terminated or expired, the Japanese Tranche Percentages shall
be determined based upon the Japanese Tranche Commitments most recently in
effect, giving effect to any assignments.

“Japanese Tranche Revolving Borrowing” means a
Borrowing comprised of Japanese Tranche Revolving Loans.

“Japanese
Tranche Revolving Loan” means a Loan made by a Japanese Tranche Lender
pursuant to Section 2.01(c).  Each
Japanese Tranche Revolving Loan made to a US Borrower shall be denominated in
US Dollars and shall be a Eurocurrency

 12
 

 

Loan or an ABR Loan, and
each Japanese Tranche Revolving Loan made to a Japanese Borrower shall be
denominated in Yen and shall be a TIBOR Loan or a Yen Base Rate Loan.

“JPMorgan” means JPMorgan Chase Bank, N.A. and
its successors.

“Judgment Currency” has the meaning assigned to
such term in Section 11.13(b).

“LC Disbursement” means a payment made by the
Issuing Bank in respect of a Letter of Credit.

“LC Exposure” means at any time the sum of
(a) the aggregate undrawn amount of all outstanding Letters of Credit at
such time and (b) the aggregate amount of all LC Disbursements that have
not yet been reimbursed by or on behalf of the Company or the applicable
Subsidiary at such time.  The LC Exposure
of any US Tranche Lender at any time shall be such Lender’s US Tranche
Percentage of the aggregate LC Exposure.

“Lenders” means the Persons listed on
Schedule 2.01 and any other Person that shall have become a party hereto
pursuant to an Assignment and Acceptance or as provided in Section 2.10,
other than any such Person that shall have ceased to be a party hereto pursuant
to an Assignment and Acceptance.

“Letter of Credit” means any letter of credit
issued pursuant to this Agreement on behalf of Lenders holding US Tranche
Commitments.

“Leverage Ratio” means, at any time, the ratio
of (a) Total Debt at such time to (b) Consolidated EBITDA for the
most recent period of four consecutive fiscal quarters of the Company ended at
or prior to such time.

“LIBO Rate” means, with respect to any
Eurocurrency Borrowing for any Interest Period, the rate per annum determined
by the Applicable Agent at approximately 11:00 a.m., London time, on the Quotation
Day for such Interest Period by reference to the British Bankers’ Association
Interest Settlement Rates for deposits in the currency of such Borrowing (as
reflected on the applicable Telerate screen), for a period equal to such
Interest Period; provided that, to the extent that an interest rate is
not ascertainable pursuant to the foregoing provisions of this definition, “LIBO
Rate” shall mean the interest rate per annum determined by the Applicable Agent
to be the average of the rates per annum at which deposits in the currency of
such Borrowing are offered for such Interest Period to major banks in the
London interbank market by JPMorgan at approximately 11:00 a.m., London
time, on the Quotation Day for such Interest Period.

“Loan Documents” means this Agreement, each
Borrowing Subsidiary Agreement, each Borrowing Subsidiary Termination, the
Subsidiary Guarantee Agreement, the Indemnity, Subrogation and Contribution
Agreement and each Letter of Credit and promissory note delivered pursuant to
this Agreement.

“Loan Parties” means the Borrowers and the
Subsidiary Guarantors.

 13
 

 

“Loans” means the loans made by the Lenders to
the Borrowers pursuant to this Agreement.

“Local Time” means (a) with respect to a
Loan, Borrowing or Letter of Credit denominated in US Dollars, New York City
time, (b) with respect to a Eurocurrency or Fixed Rate Loan or
Eurocurrency or Fixed Rate Borrowing denominated in any Designated Foreign
Currency, London time and (c) with respect to a TIBOR or Yen Base Rate
Revolving Loan or Borrowing, Tokyo time.

“London Agent” means J.P. Morgan Europe
Limited.

“Margin” means, with respect to any Competitive
Loan bearing interest at a rate based on the LIBO Rate, the marginal rate of
interest, if any, to be added to or subtracted from the LIBO Rate to determine
the rate of interest applicable to such Loan, as specified by the Lender making
such Loan in its related Competitive Bid.

“Material Subsidiary” means (a) any US
Borrower (other than the Company), any Swiss Borrower or any Japanese Borrower,
(b) any Subsidiary that directly or indirectly owns or Controls any
Material Subsidiary and (c) any other Subsidiary (i) the net revenues
of which for the most recent period of four fiscal quarters of the Company for
which audited financial statements have been delivered pursuant to
Section 5.01 were greater than 5% of the Company’s consolidated net
revenues for such period or (ii) the net tangible assets of which as of
the end of such period were greater than 5% of Consolidated Net Tangible Assets
as of such date; provided that if at any time the aggregate amount of
the net revenues or net tangible assets of all Subsidiaries that are not
Material Subsidiaries for or at the end of any period of four fiscal quarters
exceeds 5% of the Company’s consolidated net revenues for such period or 5% of
Consolidated Net Tangible Assets as of the end of such period, the Company (or,
in the event the Company has failed to do so within 10 days, the
Administrative Agent) shall designate sufficient Subsidiaries as “Material
Subsidiaries” to eliminate such excess, and such designated Subsidiaries shall
for all purposes of this Agreement constitute Material Subsidiaries.  For purposes of making the determinations
required by this definition, revenues and assets of Foreign Subsidiaries shall
be converted into US Dollars at the rates used in preparing the consolidated
balance sheet of the Company included in the applicable financial statements.

“Maturity Date” means September 29, 2011.

“Obligations” means (a) the due and punctual
payment of (i) the principal of and premium, if any, and interest
(including interest accruing during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding) on the Loans made to any Borrower, when and as
due, whether at maturity, by acceleration, upon one or more dates set for
prepayment or otherwise, (ii) each payment required to be made by any
Borrower under this Agreement in respect of any Letter of Credit, when and as
due, including payments in respect of reimbursement of disbursements, interest
thereon and obligations to provide cash collateral and (iii) all other
monetary obligations, including fees, costs, expenses and

 14
 

 

indemnities, whether
primary, secondary, direct, contingent, fixed or otherwise (including monetary
obligations incurred during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding), of the Loan Parties under this Agreement and the
other Loan Documents, and (b) unless otherwise agreed upon in writing by
the applicable Lender party thereto, the due and punctual payment and
performance of all obligations of the Company or any Subsidiary, monetary or
otherwise, under each interest rate hedging Agreement relating to Obligations
referred to in the preceding clause (a) entered into with any counterparty
that was a Lender (or an Affiliate thereof) at the time such hedging agreement
was entered into.

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

“Person” means any natural person, corporation,
limited liability company, trust, joint venture, association, company,
partnership, Governmental Authority or other entity.

“Prime Rate” means the rate of interest per
annum publicly announced from time to time by JPMorgan Chase Bank, N.A. as its
prime rate in effect at its principal office in New York City; each change
in the Prime Rate shall be effective from and including the date such change is
publicly announced as being effective.

“Qualifying Bank” means an entity which is duly
licensed as a bank and actively engaged in the banking business.

“Quotation Day” means, with respect to any
Eurocurrency Borrowing and any Interest Period, the day on which it is market
practice in the relevant interbank market for prime banks to give quotations
for deposits in the currency of such Borrowing for delivery on the first day of
such Interest Period.  If such quotations
would normally be given by prime banks on more than one day, the Quotation Day
will be the last of such days.

“Register” has the meaning set forth in
Section 11.04.

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

“Related Parties” means, with respect to any
specified Person, such Person’s Affiliates and the respective directors,
officers, employees, trustees, agents and advisors of such Person and such
Person’s Affiliates.

“Required Lenders” means, at any time, Lenders
having Revolving Credit Exposures and unused Commitments representing more than
50% of the sum of the total Revolving Credit Exposures and unused Commitments
at such time; provided that, for

 15
 

 

purposes of declaring the
Loans to be due and payable pursuant to Article VII, and for all purposes
after the Loans become due and payable pursuant to Article VII or the
Commitments expire or terminate, the outstanding Competitive Loans of the
Lenders shall be included in their respective Revolving Credit Exposures in
determining the Required Lenders.

“Reset Date” has the meaning set forth in
Section 1.05(a).

“Revolving Availability Period” means the
period from and including the Effective Date to but excluding the earlier of
the Maturity Date and the date of termination of the Commitments.

“Revolving Borrowing” means a Borrowing
comprised of US Tranche Revolving Loans, Swiss Tranche Revolving Loans or
Japanese Tranche Revolving Loans.

“Revolving Credit Exposure” means a US Tranche
Revolving Exposure, a Swiss Tranche Exposure or a Japanese Tranche Exposure.

“Revolving Loan” means any US Tranche Revolving
Loan, Swiss Tranche Revolving Loan or Japanese Tranche Revolving Loan.

“Sale and Leaseback Transaction” means any
arrangement whereby the Company or a Material Subsidiary, directly or
indirectly, shall sell or transfer any property, real or personal, used or
useful in its business, whether now owned or hereafter acquired, and thereafter
rent or lease such property or other property which it intends to use for
substantially the same purpose or purposes as the property being sold or
transferred.

“Secured Debt” means Debt or any other
obligation or liability of the Company or any Material Subsidiary the payment
of which is secured by a Security Interest.

“Security Interest” means any lien, security
interest, mortgage or other charge or encumbrance of any kind, title retention
device, pledge or any other type of preferential arrangement, upon or with
respect to any property of the Company or any Material Subsidiary, whether now
owned or hereafter acquired.

“Specified Obligations” means Obligations
consisting of the principal of and interest on Loans, reimbursement obligations
in respect of LC Disbursements (including interest accrued thereon), and fees.

“Statutory Reserve Rate” means, with respect to
any currency, a fraction (expressed as a decimal), the numerator of which is
the number one and the denominator of which is the number one minus the
aggregate of the maximum reserve, liquid asset or similar percentages
(including any marginal, special, emergency or supplemental reserves) expressed
as a decimal established by any Governmental Authority of the United States or
of the jurisdiction of such currency or any jurisdiction in which Loans in

 16
 

 

such currency are made to
which banks in such jurisdiction are subject for any category of deposits or
liabilities customarily used to fund loans in such currency or by reference to
which interest rates applicable to Loans in such currency are determined.  Such reserve, liquid asset or similar
percentages shall include those imposed pursuant to Regulation D of the
Board.  Eurocurrency Loans and TIBOR
Loans shall be deemed to be subject to such reserve requirements without
benefit of or credit for proration, exemptions or offsets that may be available
from time to time to any Lender under any applicable law, rule or
regulation.  The Statutory Reserve Rate
shall be adjusted automatically on and as of the effective date of any change
in any reserve percentage.

“Sterling” or “£” means the lawful money of the
United Kingdom.

“subsidiary” means, with respect to any Person,
any entity with respect to which such Person alone owns, such Person or one or
more of its subsidiaries together own, or such Person and any Person
Controlling such Person together own, in each case directly or indirectly,
capital stock or other equity interests having ordinary voting power to elect a
majority of the members of the Board of Directors of such corporation or other
entity or having a majority interest in the capital or profits of such
corporation or other entity.

“Subsidiary” means any subsidiary of the
Company.

“Subsidiary Guarantee Agreement” means a
Subsidiary Guarantee Agreement substantially in the form of Exhibit C,
made by the Subsidiary Guarantors in favor of the Administrative Agent for the
benefit of the Lenders.

“Subsidiary Guarantors” means each Person
listed on Schedule 1.01 and each other Person that becomes party to a
Subsidiary Guarantee Agreement as a Subsidiary Guarantor, and the permitted
successors and assigns of each such Person.

“Swiss Borrower” means any Swiss Subsidiary
that has been designated as such pursuant to Section 2.20 and that has not
ceased to be a Swiss Borrower as provided in such Section.

“Swiss Subsidiary” means any Subsidiary that is
incorporated or otherwise organized in Switzerland.

“Swiss Francs” or “SF” means the lawful money of
Switzerland.

“Swiss Tranche Commitment” means, with respect
to each Swiss Tranche Lender, the commitment of such Swiss Tranche Lender to
make Swiss Tranche Revolving Loans pursuant to Section 2.01(b), expressed
as an amount representing the maximum aggregate amount of such Swiss Tranche
Lender’s Swiss Tranche Exposure hereunder, as such commitment may be
(a) reduced from time to time pursuant to Section 2.09 and
(b) reduced or increased from time to time pursuant to assignments by or
to such Lender pursuant to Section 11.04. 
The initial amount of each Swiss Tranche Lender’s Swiss Tranche
Commitment is set forth on Schedule 2.01, or in the Assignment and
Acceptance pursuant to which such Swiss Tranche Lender shall have assumed its

 17
 

 

Swiss Tranche Commitment,
as applicable.  The aggregate amount of
the Swiss Tranche Commitments on the date hereof is $150,000,000.

“Swiss Tranche Exposure” means, with respect to
any Swiss Tranche Lender at any time, such Lender’s Swiss Tranche Percentage of
the sum of the US Dollar Equivalents of the principal amounts of the
outstanding Swiss Tranche Revolving Loans.

“Swiss Tranche Lender” mean a Lender with a
Swiss Tranche Commitment.

“Swiss Tranche Percentage” means, with respect
to any Swiss Tranche Lender, the percentage of the total Swiss Tranche
Commitments represented by such Lender’s Swiss Tranche Commitment.  If the Swiss Tranche Commitments have
terminated or expired, the Swiss Tranche Percentages shall be determined based
upon the Swiss Tranche Commitments most recently in effect, giving effect to
any assignments.

“Swiss Tranche Revolving Borrowing” means a
Borrowing comprised of Swiss Tranche Revolving Loans.

“Swiss Tranche Revolving Loan” means a Loan
made by a Swiss Tranche Lender pursuant to Section 2.01(b).  Each Swiss Tranche Revolving Loan made to a
US Borrower shall be denominated in US Dollars and shall be a Eurocurrency Loan
or an ABR Loan, and each Swiss Tranche Revolving Loan made to a Swiss Borrower
shall be denominated in Swiss Francs and shall be a Eurocurrency Loan.

“Taxes” means any and all present or future
taxes, levies, imposts, duties, deductions, charges or withholdings imposed by
any Governmental Authority.

“TIBO Rate” means, with respect to any TIBOR
Borrowing for any Interest Period, the interest rate per annum for deposits for
a maturity most nearly comparable to such Interest Period in Yen appearing on
Telerate Screen page 17097 (or on any successor or substitute page of such
service providing rate quotations comparable to those currently provided on
such page of such service, as determined by the Tokyo Agent from time to time
for purposes of providing quotations of interest rates in the Tokyo interbank
market) at approximately 11:00 a.m., Tokyo time, two Business Days prior
to the commencement of such Interest Period. 
In the event that such rate is not available at such time for any
reason, then the “TIBO Rate” with respect to such TIBOR Borrowing for
such Interest Period shall be the rate at which deposits for a maturity most
nearly comparable to such Interest Period in Yen are offered by the principal
Tokyo office of the Tokyo Agent in immediately available funds in the Tokyo
interbank market at approximately 11:00 a.m., Tokyo time, two Business
Days prior to the commencement of such Interest Period.

“TIBOR”, when used in reference to any Loan or
Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing,
are bearing interest at a rate determined by reference to the TIBO Rate.

“Tokyo Agent” means Mizuho Corporate Bank, Ltd.

 18
 

 

“Total Debt” means, at any date, all Debt of
the Company and its consolidated Subsidiaries at such date to the extent such
Debt should be reflected on a consolidated balance sheet of the Company at such
date in accordance with GAAP.

“Tranche” means a category of Commitments and
extensions of credit thereunder.  For
purposes hereof, each of the following comprise a separate Tranche:  (i) the US Tranche Commitments, the US
Tranche Revolving Loans and the Competitive Loans, (ii) the Swiss Tranche
Commitments and the Swiss Tranche Revolving Loans and (iii) the Japanese
Tranche Commitments and the Japanese Tranche Revolving Loans.

“Transactions” means the execution, delivery
and performance by the Loan Parties of the Loan Documents, the borrowing of
Loans and the use of the proceeds thereof and the issuance of Letters of Credit
hereunder.

“Transfer Assets” means (a) when referring
to the Company, the conveyance, transfer, lease or other disposition (whether
in one transaction or in a series of transactions) of all or substantially all
of the assets of the Company or of the Company and its Subsidiaries taken as a
whole, and (b) when referring to a Subsidiary, the conveyance, transfer,
lease or other disposition (whether in one transaction or in a series of
transactions) of all or substantially all of the assets of such Subsidiary.

“Type”, when used in reference to any Loan or
Borrowing, refers to whether the rate of interest on such Loan, or on the Loans
comprising such Borrowing, is determined by reference to the LIBO Rate, the
TIBO Rate, the Alternate Base Rate, the Yen Base Rate or a Fixed Rate.

“Unfunded Liabilities” means, in the case of a
single employer pension benefit plan which is covered by Title IV of ERISA, the
amount, if any, by which the present value of all vested benefits accrued to
the date of determination under such plan exceeds the fair market value of all
assets of such plan allocable to such benefits as of such date, and, in the
case of a multiemployer pension plan, the withdrawal liability of the Company
and the Subsidiaries.

“US Borrowers” means the Company, Edwards
Lifesciences World Trade Corporation, Edwards Lifesciences LLC, Edwards
Lifesciences (U.S.) Inc. and any other US Subsidiary that has been designated
as a US Borrower pursuant to Section 2.20 and that has not ceased to be a US Borrower
as provided in such Section.

“US Corporation” means a corporation organized
and existing under the laws of the United States, any state thereof or the
District of Columbia.

“US Dollar Equivalent” means, on any date of
determination, (a) with respect to any amount in US Dollars, such amount,
and (b) with respect to any amount in any Designated Foreign Currency, the
equivalent in US Dollars of such amount, determined by the Administrative Agent
pursuant to Section 1.05 using the Exchange Rate with respect to such
Designated Foreign Currency at the time in effect under the provisions of such
Section.

 19
 

 

“US Dollars” or “$” means the lawful
money of the United States of America.

“US Subsidiary” means any Subsidiary that is
incorporated or otherwise organized under the laws of the United States or its
territories or possessions.

“US Tranche Commitment” means, with respect to
each US Tranche Lender, the commitment of such US Tranche Lender to make US
Tranche Revolving Loans pursuant to Section 2.01(a), expressed as an
amount representing the maximum aggregate amount of such US Tranche Lender’s US
Tranche Revolving Exposure hereunder, as such commitment may be
(a) reduced from time to time pursuant to Section 2.09 and
(b) reduced or increased from time to time pursuant to assignments by or
to such Lender pursuant to Section 11.04. 
The initial amount of each US Tranche Lender’s US Tranche Commitment is
set forth on Schedule 2.01, or in the Assignment and Acceptance pursuant
to which such US Tranche Lender shall have assumed its US Tranche Commitment,
as applicable.  The aggregate amount of
the US Tranche Commitments on the date hereof is $250,000,000.

“US Tranche Lender” mean a Lender with a US
Tranche Commitment.

“US Tranche Percentage” means, with respect to
any US Tranche Lender, the percentage of the total US Tranche Commitments
represented by such Lender’s US Tranche Commitment.  If the US Tranche Commitments have terminated
or expired, the US Tranche Percentages shall be determined based upon the US
Tranche Commitments most recently in effect, giving effect to any assignments.

“US Tranche Revolving Borrowing” means a
Borrowing comprised of US Tranche Revolving Loans.

“US Tranche Revolving Exposure” means, with
respect to any US Tranche Lender at any time, the sum at such time, without
duplication, of (a) such Lender’s US Tranche Percentage of the sum of the
US Dollar Equivalents of the principal amounts of the outstanding US Tranche
Revolving Loans, plus (b) the aggregate amount of such Lender’s LC
Exposure.

“US Tranche Revolving Loan” means a Loan made
by a US Tranche Lender pursuant to Section 2.01(a).  Each US Tranche Revolving Loan denominated in
US Dollars shall be a Eurocurrency Loan or an ABR Loan, and each US Tranche
Revolving Loan denominated in a Designated Foreign Currency shall be a
Eurocurrency Loan.

“Yen” or “¥” refers to the lawful money of
Japan.

“Yen Base Rate” means, with respect to any Yen
Base Rate Revolving Borrowing for any Interest Period, the rate of interest per
annum publicly announced from time to time by the Tokyo Agent as its short-term
prime rate in effect at its principal office in Tokyo; each change in the Yen
Base Rate shall be effective from and including the date such change is
publicly announced as being effective.

 20
 

 

SECTION 1.02.  Classification
of Loans and Borrowings.  For
purposes of this Agreement, Loans may be classified and referred to by Class (e.g.,
a “US Tranche Revolving Loan”) or by Type (e.g., a “Eurocurrency Loan”)
or by Class and Type (e.g., a “Eurocurrency US Tranche Revolving Loan”).  Borrowings also may be classified and
referred to by Class (e.g., a “US Tranche Revolving Borrowing”) or by
Type (e.g., a “US Tranche Eurocurrency Borrowing”) or by Class and Type
(e.g., a “Eurocurrency US Tranche Revolving Borrowing”).

SECTION 1.03.  Terms
Generally.  The definitions of terms
herein shall apply equally to the singular and plural forms of the terms
defined.  Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms.  The words “include”, “includes”
and “including” shall be deemed to be followed by the phrase “without
limitation”.  The word “will” shall be
construed to have the same meaning and effect as the word “shall”.  Unless the context requires otherwise
(a) any definition of or reference to any agreement, instrument or other
document herein shall be construed as referring to such agreement, instrument
or other document as from time to time amended, supplemented or otherwise
modified (subject to any restrictions on such amendments, supplements or
modifications set forth herein), (b) any reference herein to any Person
shall be construed to include such Person’s successors and assigns,
(c) the words “herein”, “hereof” and “hereunder” and words of similar
import shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (e) the
words “asset” and “property” shall be construed to have the same meaning and
effect and to refer to any and all tangible and intangible assets and
properties, including cash, securities, accounts and contract rights.

SECTION 1.04.  Accounting
Terms; GAAP.  Except as otherwise
expressly provided herein, all terms of an accounting or financial nature shall
be construed in accordance with GAAP as in effect from time to time; provided
that if the Company notifies the Administrative Agent that the Company requests
an amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the
operation of such provision (or if the Administrative Agent notifies the
Company that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have
been withdrawn or such provision amended in accordance herewith.

SECTION 1.05.  Exchange Rates.  (a) 
Not later than 10:00 a.m., New York City time, on each
Calculation Date, the Administrative Agent shall (i) determine the
Exchange Rate as of such Calculation Date with respect to each Designated
Foreign Currency and (ii) give written notice thereof to the Lenders and
the Company.  The Exchange Rates so
determined shall become effective on the first Business Day immediately
following the relevant Calculation Date (a “Reset Date”), shall remain
effective until the next succeeding Reset Date, and shall for all purposes of

 21
 

 

this Agreement
(other than Section 11.13 or any other provision expressly requiring the
use of a current Exchange Rate) be the Exchange Rates employed in converting
any amounts between US Dollars and Designated Foreign Currencies.

(b)  Not later than 5:00 p.m.,
New York City time, on each Reset Date and each date on which Revolving
Loans denominated in any Designated Foreign Currency are made, the
Administrative Agent shall (i) determine the aggregate amount of the US
Dollar Equivalents of the principal amounts of the Revolving Loans of each
Class denominated in Designated Foreign Currencies (after giving effect to any
Revolving Loans made or repaid on such date) and (ii) notify the Lenders
and the Company of the results of such determination.

SECTION 1.06.  Redenomination
of Certain Foreign Currencies. 
(a)  Each obligation of any party
to this Agreement to make a payment denominated in the national currency unit
of any member state of the European Union that adopts the Euro as its lawful
currency after the date hereof shall be redenominated into Euro at the time of
such adoption (in accordance with the EMU Legislation).  If, in relation to the currency of any such
member state, the basis of accrual of interest expressed in this Agreement in
respect of that currency shall be inconsistent with any convention or practice
in the London Interbank Market for the basis of accrual of interest in respect
of the Euro, such expressed basis shall be replaced by such convention or
practice with effect from the date on which such member state adopts the Euro
as its lawful currency; provided that if any Borrowing in the currency
of such member state is outstanding immediately prior to such date, such
replacement shall take effect, with respect to such Borrowing, at the end of the
then current Interest Period.

(b)  Each provision of this
Agreement shall be subject to such reasonable changes of construction as the
Administrative Agent may from time to time specify to be appropriate to reflect
the adoption of the Euro by any member state of the European Union and any
relevant market conventions or practices relating to the Euro.

ARTICLE II

The Credits

SECTION 2.01.  Commitments.  (a) 
Subject to the terms and conditions set forth herein, each US Tranche
Lender agrees to make US Tranche Revolving Loans to the US Borrowers from time
to time during the Revolving Availability Period in US Dollars or any
Designated Foreign Currency in an aggregate principal amount at any time
outstanding that will not result in (i) such Lender’s US Tranche Revolving
Exposure exceeding its US Tranche Commitment or (ii) the aggregate amount
of the Lenders’ US Tranche Revolving Exposures and Competitive Loan Exposures
exceeding the aggregate amount of the US Tranche Commitments.

(b)  Subject to the terms and
conditions set forth herein, each Swiss Tranche Lender agrees to make Swiss
Tranche Revolving Loans to the Swiss Borrowers

 22
 

 

in Swiss
Francs or Euros and to the US Borrowers in US Dollars in an aggregate principal
amount at any time outstanding that will not result in (i) such Lender’s
Swiss Tranche Exposure exceeding its Swiss Tranche Commitment or (ii) the
aggregate amount of the Lenders’ Swiss Tranche Exposures exceeding the
aggregate amount of the Swiss Tranche Commitments.

(c)  Subject to the terms and
conditions set forth herein, each Japanese Tranche Lender agrees to make
Japanese Tranche Revolving Loans to the Japanese Borrowers in Yen and to the US
Borrowers in US Dollars in an aggregate principal amount at any time
outstanding that will not result in (i) such Lender’s Japanese Tranche
Exposure exceeding its Japanese Tranche Commitment or (ii) the aggregate
amount of the Lenders’ Japanese Tranche Exposures exceeding the aggregate
amount of the Japanese Tranche Commitments.

SECTION 2.02.  Loans and Borrowings.  (a) 
Each US Tranche Revolving Loan shall be made as part of a Borrowing
consisting of US Tranche Revolving Loans made by the US Tranche Lenders ratably
in accordance with their respective US Tranche Commitments.  Each Swiss Tranche Revolving Loan shall be
made as part of a Borrowing consisting of Swiss Tranche Revolving Loans made by
the Swiss Tranche Lenders ratably in accordance with their respective Swiss
Tranche Commitments.  Each Japanese
Tranche Revolving Loan shall be made as part of a Borrowing consisting of
Japanese Tranche Revolving Loans made by the Japanese Tranche Lenders ratably
in accordance with their respective Japanese Tranche Commitments.  Each Competitive Loan shall be made in
accordance with the procedures set forth in Section 2.04.  The failure of any Lender to make any Loan
required to be made by it shall not relieve any other Lender of its obligations
hereunder; provided that the Commitments of the Lenders are several and
no Lender shall be responsible for any other Lender’s failure to make Loans as
required hereunder.

(b)  Subject to
Section 2.14, (i) each US Tranche Revolving Borrowing shall be
comprised entirely of (A) in the case of a Borrowing denominated in US
Dollars, Eurocurrency Loans or ABR Loans and (B) in the case of a
Borrowing denominated in a Designated Foreign Currency, Eurocurrency Loans, in
each case as the Company may request in accordance herewith; (ii) each
Swiss Tranche Revolving Borrowing shall be comprised entirely of (A) in
the case of a Borrowing denominated in Swiss Francs or Euros, Eurocurrency
Loans and, (B) in the case of a Borrowing denominated in US Dollars,
Eurocurrency Loans or ABR Loans, in each case as the applicable Borrower may
request in accordance herewith; (iii) each Japanese Tranche Revolving
Borrowing shall be comprised entirely of (A) in the case of a Borrowing
denominated in Yen, TIBOR Loans or Yen Base Rate Loans and (B) in the case
of a Borrowing denominated in US Dollars, Eurocurrency Loans or ABR Loans, in
each case as the applicable Borrower may request in accordance herewith; and
(iv) each Competitive Borrowing shall be comprised entirely of
Eurocurrency Loans or Fixed Rate Loans, in each case as the applicable Borrower
may request in accordance herewith.  Each
Lender at its option may make any Loan by causing any domestic or foreign
branch or Affiliate of such Lender to make such Loan (and in the case of an
Affiliate, the provisions of Sections 2.14, 2.15, 2.16 and 2.17 shall
apply to such Affiliate to the same extent as to such Lender); provided
that any

 23
 

 

exercise of
such option shall not affect the obligation of the applicable Borrower to repay
such Loan in accordance with the terms of this Agreement.

(c)  At the commencement of each
Interest Period for any Borrowing, such Borrowing shall be in an aggregate
amount that is at least equal to the Borrowing Minimum and an integral multiple
of the Borrowing Multiple; provided that (i) an ABR Revolving Borrowing
may be made in an aggregate amount that is equal to the aggregate available US
Tranche Commitments, Swiss Tranche Commitments or Japanese Tranche Commitments,
as the case may be and (ii) a Yen Base Rate Revolving Borrowing may be made in
an aggregate amount that is equal to the aggregate available Japanese Tranche
Commitments.  Borrowings of more than one
Type and Class may be outstanding at the same time; provided that there
shall not at any time be more than a total of (i) twelve US Tranche
Eurocurrency Revolving Borrowings outstanding, (ii) six Swiss Tranche
Eurocurrency Revolving Borrowings outstanding or (iii) six Japanese Tranche
TIBOR or Eurocurrency Revolving Borrowings outstanding.

(d)  Notwithstanding any other
provision of this Agreement, no Borrower shall be entitled to request, or to
elect to convert or continue, any Borrowing if the Interest Period requested
with respect thereto would end after the Maturity Date.

SECTION 2.03.  Requests for
Revolving Borrowings.  To request a
Revolving Borrowing, the applicable Borrower, or the Company on behalf of the
applicable Borrower, shall notify the Applicable Agent of such request by
telephone (a) in the case of a Eurocurrency Borrowing, not later than
12:00 noon, Local Time, three Business Days before the date of the
proposed Borrowing, (b) in the case of a TIBOR Borrowing, not later than
5:00 p.m., Local Time, four Business Days before the date of the proposed
Borrowing, (c) in the case of an ABR Borrowing, not later than
12:00 noon, Local Time, one Business Day before the date of the proposed
Borrowing and (d) in the case of a Yen Base Rate Revolving Borrowing, not
later than 12:00 noon, Local Time, two Business Days before the date of
the proposed Borrowing; provided that any such notice of an ABR
Revolving Borrowing to finance the reimbursement of an LC Disbursement as contemplated
by Section 2.05(e) may be given not later than 12:00 noon, Local
Time, on the date of the proposed Borrowing. 
Each such telephonic Borrowing Request shall be irrevocable and shall be
confirmed promptly by hand delivery or telecopy to the Applicable Agent of a
written Borrowing Request in a form approved by the Applicable Agent and signed
by the applicable Borrower, or by the Company on behalf of the applicable
Borrower.  Each such telephonic and
written Borrowing Request shall specify the following information in compliance
with Section 2.02:

(i)  the Borrower requesting such Borrowing
(or on whose behalf the Company is requesting such Borrowing);

(ii)  whether the requested Borrowing is to
be a US Tranche Revolving Borrowing, a Swiss Tranche Revolving Borrowing or a
Japanese Tranche Revolving Borrowing;

 24

 

(iii)  the currency and aggregate principal
amount of the requested Borrowing;

(iv)  the date of the requested Borrowing,
which shall be a Business Day;

(v)  the Type of the requested Borrowing;

(vi)  in the case of a Eurocurrency
Borrowing, TIBOR Borrowing or Yen Base Rate Borrowing, the initial Interest
Period to be applicable thereto, which shall be a period contemplated by the
definition of the term “Interest Period”;

(vii)  the location and number of the
relevant Borrower’s account to which funds are to be disbursed, which shall
comply with the requirements of Section 2.06; and

(viii)  in the case of a Borrowing in a
Foreign Currency, the location from which payments of the principal and
interest on such Borrowing will be made.

If no currency is specified with respect to any
requested Eurocurrency Revolving Borrowing, then the relevant Borrower shall be
deemed to have selected US Dollars.  If
no election as to the Type of Borrowing is specified, then the requested Borrowing
shall be (i) in the case of a Borrowing denominated in US Dollars, an ABR
Borrowing, (ii) in the case of a Borrowing by a Swiss Borrower denominated in
Swiss Francs, a Eurocurrency Borrowing, (iii) in the case of a Borrowing by a
Japanese Borrower denominated in Yen, a Yen Base Rate Revolving Borrowing and
(iv) in the case of any other Borrowing, a Eurocurrency Borrowing.  If no Interest Period is specified with
respect to any requested Eurocurrency Borrowing or TIBOR Borrowing, then the
relevant Borrower shall be deemed to have selected an Interest Period of one
month’s duration.  Promptly following
receipt of a Borrowing Request in accordance with this Section, the Applicable
Agent shall advise each Lender that will make a Loan as part of the requested
Borrowing of the details thereof and of the amount of the Loan to be made by
such Lender as part of the requested Borrowing.

SECTION 2.04.  Competitive Bid
Procedure.  (a)  Subject to the terms and conditions set forth
herein, from time to time during the Revolving Availability Period the Company
may request Competitive Bids for Competitive Loans in US Dollars or one or more
Designated Foreign Currencies and may (but shall not have any obligation to)
accept Competitive Bids and borrow Competitive Loans; provided that the
sum of the US Tranche Revolving Exposures and Competitive Loan Exposures at any
time shall not exceed the aggregate amount of the Lenders’ US Tranche
Commitments.  To request Competitive
Bids, the Company shall notify the Applicable Agent of such request by
telephone, (i) in the case of a Eurocurrency Competitive Borrowing or a
Fixed Rate Competitive Borrowing denominated in a Designated Foreign Currency,
not later than 12:00 noon, Local Time, four Business Days before the date
of the proposed Competitive Borrowing and (ii) in the case of a Fixed Rate
Revolving Borrowing denominated in US Dollars, not later than 12:00 noon,
Local Time, one Business Day before the date of the proposed Competitive
Borrowing.  Not more than three Competitive
Bid Requests may

 25
 

 

be submitted
on the same day, and a Competitive Bid Request shall not be made within
five Business Days after the date of any previous Competitive Bid Request
unless any and all such previous Competitive Bid Requests shall have been
withdrawn or all Competitive Bids received in response thereto rejected.  Each telephonic Competitive Bid Request shall
be confirmed promptly by hand delivery or telecopy to the Applicable Agent of a
written Competitive Bid Request in a form approved by the Applicable Agent and
signed by the Company.  Each such
telephonic and written Competitive Bid Request shall specify the following
information in compliance with Section 2.02:

(i) the aggregate amount of the requested Borrowing;

(ii) the date of such Borrowing, which shall be a
Business Day;

(iii) whether the requested Borrowing is to be
denominated in US Dollars or a Designated Foreign Currency (specifying such
Designated Foreign Currency, if applicable);

(iv) whether such Borrowing is to be a Eurocurrency
Borrowing or a Fixed Rate Revolving Borrowing;

(v) the Interest Period to be applicable to such
Borrowing, which shall be a period contemplated by the definition of the term “Interest
Period”;

(vi) the location and number of the Company’s account to
which funds are to be disbursed, which shall comply with the requirements of
Section 2.06; and

(vii) in the case of any Borrowing in a Designated
Foreign Currency, the location from which payments of the principal of and
interest on such Borrowing will be made.

If no election as to the currency of a Borrowing is
specified in any Competitive Bid Request, then the Company shall be deemed to
have requested a Borrowing in US Dollars. 
Promptly following receipt of a Competitive Bid Request in accordance
with this Section, the Applicable Agent shall notify the Lenders of the details
thereof by telecopy, inviting the US Tranche Lenders to submit Competitive
Bids.

(b)  Each US Tranche Lender may
(but shall not have any obligation to) make one or more Competitive Bids to the
Company in response to a Competitive Bid Request.  Each Competitive Bid by a Lender must be in a
form approved by the Applicable Agent and must be received by the Applicable
Agent by telecopy, (i) in the case of a Eurocurrency Competitive Borrowing
or a Fixed Rate Competitive Borrowing denominated in a Designated Foreign
Currency, not later than 11:00 a.m., Local Time, three Business Days
before the date of the proposed Competitive Borrowing and (ii) in the case of a
Fixed Rate Revolving Borrowing denominated in US Dollars, not later than 9:30 a.m.,
Local Time, on the date of the proposed Competitive Borrowing.  Competitive Bids that do not conform to the
form approved by the Applicable Agent may be rejected by the Applicable Agent,
and the Applicable Agent shall notify the applicable Lender as promptly as
practicable.  Each Competitive Bid shall
specify (i) the principal amount

 26
 

 

(which shall
be in an amount that is at least equal to the Borrowing Minimum and an integral
multiple of the Borrowing Multiple, and which may equal the entire principal
amount of the Competitive Borrowing requested by the Company) of the
Competitive Loan or Loans that the Lender is willing to make, (ii) the
Competitive Bid Rate or Rates at which the Lender is prepared to make such Loan
or Loans (expressed as a percentage rate per annum in the form of a decimal to
no more than four decimal places) and (iii) the Interest Period applicable
to each such Loan and the last day thereof.

(c)  The Applicable Agent shall
promptly notify the Company by telecopy of the Competitive Bid Rate and the
principal amount specified in each Competitive Bid and the identity of the US
Tranche Lender that shall have made such Competitive Bid.

(d)  Subject only to the
provisions of this paragraph, the Company may accept or reject any Competitive
Bid.  The Company shall notify the
Applicable Agent by telephone, confirmed by telecopy in a form approved by the
Applicable Agent, whether and to what extent it has decided to accept or reject
each Competitive Bid, (i) in the case of a Eurocurrency Competitive
Borrowing or a Fixed Rate Competitive Borrowing denominated in a Designated
Foreign Currency, not later than 12:00 noon, Local Time, three Business Days
before the date of the proposed Competitive Borrowing and (ii) in the case of a
Fixed Rate Revolving Borrowing denominated in US Dollars, not later than
10:30 a.m., Local Time, on the date of the proposed Competitive Borrowing;
provided that (i) the failure of the Company to give such notice
shall be deemed to be a rejection of each Competitive Bid, (ii)  the
Company shall not accept a Competitive Bid made at a particular Competitive Bid
Rate if such Borrower rejects a Competitive Bid made at a lower Competitive Bid
Rate, (iii) the aggregate amount of the Competitive Bids accepted by the Company
shall not exceed the aggregate amount of the requested Competitive Borrowing
specified in the related Competitive Bid Request, (iv) to the extent
necessary to comply with clause (iii) above, the Company may accept
Competitive Bids at the same Competitive Bid Rate in part, which acceptance, in
the case of multiple Competitive Bids at such Competitive Bid Rate, shall be
made pro rata in accordance with the amount of each such Competitive Bid, and
(v) except pursuant to clause (iv) above, no Competitive Bid shall be
accepted for a Competitive Loan unless such Competitive Loan is in a minimum
principal amount of at least the Borrowing Minimum and an integral multiple of
the Borrowing Multiple; provided further that if a Competitive Loan must
be in an amount less than the Borrowing Minimum because of the provisions of
clause (iv) above, such Competitive Loan may be for a minimum of
$1,000,000 (or, in the case of an Designated Foreign Currency Competitive Loan,
the smallest amount of such Alternate Currency that (i) is an integral multiple
of 1,000,000 units (or, in the case of Sterling, 500,000 units) of such
currency and (ii) has a US Dollar Equivalent in excess of $1,000,000), and in
calculating the pro rata allocation of acceptances of portions of multiple
Competitive Bids at a particular Competitive Bid Rate pursuant to
clause (iv) the amounts shall be rounded to integral multiples of the
Borrowing Multiple in a manner determined by the Company.  A notice given by the Company pursuant to
this paragraph shall be irrevocable.

(e)  The Applicable Agent shall
promptly notify each bidding US Tranche Lender by telecopy whether or not its
Competitive Bid has been accepted (and, if so, the

 27
 

 

amount and
Competitive Bid Rate so accepted), and each successful bidder will thereupon
become bound, subject to the terms and conditions hereof, to make the
Competitive Loan in respect of which its Competitive Bid has been accepted.

(f)  If the Applicable Agent or
one of its Affiliates shall elect to submit a Competitive Bid in its capacity
as a US Tranche Lender, it shall submit such Competitive Bid directly to the
Company at least one quarter of an hour earlier than the time by which the
other Lenders are required to submit their Competitive Bids to the Applicable
Agent pursuant to paragraph (b) of this Section.

SECTION 2.05.  Letters of
Credit.  (a)  General.  Subject to the terms and conditions set forth
herein, the Company may request the issuance (or the amendment, renewal or
extension) of Letters of Credit denominated in US Dollars, in any case in a
form reasonably acceptable to the Administrative Agent and the Issuing Bank, at
any time and from time to time during the Revolving Availability Period.  In the event of any form of letter of credit
application or other agreement submitted by the Company or any other Borrower
to, or entered into by the Company or any other Borrower with, the Issuing Bank
relating to any Letter of Credit, the terms and conditions of this Agreement
shall control.

(b)  Notice of Issuance,
Amendment, Renewal, Extension; Certain Conditions.  To request the issuance of a Letter of Credit
(or the amendment, renewal or extension of an outstanding Letter of Credit),
the Company shall hand deliver or telecopy (or transmit by electronic
communication, if arrangements for doing so have been approved by the Issuing
Bank) to the Issuing Bank and the Administrative Agent (reasonably in advance
of the requested date of issuance, amendment, renewal or extension) a notice
requesting the issuance of a Letter of Credit, or identifying the Letter of
Credit to be amended, renewed or extended, the date of issuance, amendment,
renewal or extension (which shall be a Business Day), the date on which such
Letter of Credit is to expire (which shall comply with paragraph (c) of
this Section), the amount of such Letter of Credit, the name and address of the
beneficiary thereof and such other information as shall be necessary to
prepare, amend, renew or extend such Letter of Credit.  If requested by the Issuing Bank, the Company
also shall submit a letter of credit application on the Issuing Bank’s standard
form in connection with any request for a Letter of Credit.  A Letter of Credit shall be issued, amended,
renewed or extended only if (and upon issuance, amendment, renewal or extension
of each Letter of Credit the Company or the applicable Borrower shall be deemed
to represent and warrant that), after giving effect to such issuance,
amendment, renewal or extension the LC Exposure shall not exceed
$25,000,000 and (ii) the aggregate US Tranche Revolving Exposures will not
exceed the aggregate US Tranche Commitments.

(c)  Expiration Date.  Each Letter of Credit shall expire at or
prior to the close of business on the earlier of (i) the date one year
after the date of the issuance of such Letter of Credit (or, in the case of any
renewal or extension thereof, one year after such renewal or extension) and
(ii) the date that is five Business Days prior to the Maturity Date.

 28
 

 

(d)  Participations.  By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without any
further action on the part of the Issuing Bank or the US Tranche Lenders, the
Issuing Bank hereby grants to each US Tranche Lender, and each US Tranche
Lender hereby acquires from the Issuing Bank, a participation in such Letter of
Credit equal to such US Tranche Lender’s US Tranche Percentage of the aggregate
amount available to be drawn under such Letter of Credit.  In consideration and in furtherance of the
foregoing, each US Tranche Lender hereby absolutely and unconditionally agrees
to pay to the Administrative Agent, for the account of the Issuing Bank, such
Lender’s US Tranche Percentage of each LC Disbursement made by the Issuing Bank
and not reimbursed by the Company on the date due as provided in paragraph (e)
of this Section or of any reimbursement payment required to be refunded to the
Company for any reason.  Each US Tranche
Lender acknowledges and agrees that its obligation to acquire participations
pursuant to this paragraph in respect of Letters of Credit is absolute and
unconditional and shall not be affected by any circumstance whatsoever,
including any amendment, renewal or extension of any Letter of Credit or the
occurrence and continuance of a Default or reduction or termination of the US
Tranche Commitments, and that each such payment shall be made without any
offset, abatement, withholding or reduction whatsoever.

(e)  Reimbursement.  If the Issuing Bank shall make any LC
Disbursement in respect of a Letter of Credit, the Company shall reimburse such
LC Disbursement by paying to the Administrative Agent an amount equal to such
LC Disbursement, not later than 1:00 p.m., New York City time, on the date that
such LC Disbursement is made, if the Company shall have received notice of such
LC Disbursement prior to 11:00 a.m., New York City time, on such date, or, if
such notice has not been received by the Company prior to such time on such
date, then not later than 1:00 p.m., New York City time, on (A) the
Business Day that the Company receives such notice, if such notice is received
prior to 11:00 a.m., New York City time, on the day of receipt, or (B) the
Business Day immediately following the day that the Company receives such
notice, if such notice is not received prior to such time on the day of
receipt.  If the Company fails to make
such payment when due then, upon notice from the applicable Issuing Bank to the
Company and the Administrative Agent, the Administrative Agent shall notify
each US Tranche Lender of the applicable LC Disbursement,  the payment then due from the Company in
respect thereof and such Lender’s US Tranche Percentage, thereof.  Promptly following receipt of such notice,
each US Tranche Lender shall pay to the Administrative Agent its US Tranche
Percentage of the payment then due from the Company in the same manner as
provided in Section 2.06 with respect to Loans made by such US Tranche
Lender (and Section 2.06 shall apply, mutatis  mutandis, to
the payment obligations of the US Tranche Lenders), and the Administrative
Agent shall promptly pay to the applicable Issuing Bank the amounts so received
by it from the US Tranche Lenders. 
Promptly following receipt by the Administrative Agent of any payment
from the Company pursuant to this paragraph, the Administrative Agent shall
distribute such payment to the Issuing Bank or, to the extent that US Tranche
Lenders have made payments pursuant to this paragraph to reimburse the Issuing
Bank, then to such US Tranche Lenders and the Issuing Bank as their interests
may appear.  Any payment made by a US
Tranche Lender pursuant to this paragraph to reimburse the Issuing Bank for any

 29
 

 

LC
Disbursement shall not constitute a Loan and shall not relieve the Company of
its obligation to reimburse such LC Disbursement.

(f)  Obligations Absolute.  The Company’s obligations to reimburse LC
Disbursements as provided in paragraph (e) of this Section 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 and irrespective of (i) any lack of validity or enforceability of
any Letter of Credit or this Agreement or any other Loan Document, or any term
or provision herein or therein, (ii) any draft or other document presented
under a Letter of Credit proving to be forged, fraudulent or invalid in any
respect or any statement therein being untrue or inaccurate in any respect,
(iii) 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, or (iv) any other event or circumstance whatsoever, whether or
not similar to any of the foregoing, that might, but for the provisions of this
Section, constitute a legal or equitable discharge of, or provide a right of
set-off against, the Company’s obligations hereunder.  None of the Administrative Agent, the US
Tranche Lenders or the Issuing Bank, or any of their Related Parties, shall
have any liability or responsibility by reason of or in connection with the
issuance or transfer of any Letter of Credit or any payment or failure to make
any payment thereunder (irrespective of any of the circumstances referred to in
the preceding sentence), or any error, omission, interruption, loss or delay in
transmission or delivery of any draft, notice or other communication under or
relating to any Letter of Credit (including any document required to make a
drawing thereunder), any error in interpretation of technical terms or any
consequence arising from causes beyond the control of the Issuing Bank; provided
that the foregoing shall not be construed to excuse the Issuing Bank from
liability to the Company to the extent of any direct damages (as opposed to
consequential damages, claims in respect of which are hereby waived by the
Company to the extent permitted by applicable law) suffered by the Company that
are caused by the Issuing Bank’s failure to exercise care when determining
whether drafts and other documents presented under a Letter of Credit comply
with the terms thereof.  The parties
hereto expressly agree that, in the absence of gross negligence or wilful
misconduct on the part of the Issuing Bank (as finally determined by a court of
competent jurisdiction), the Issuing Bank shall be deemed to have exercised
care in each such determination.  In
furtherance of the foregoing and without limiting the generality thereof, the
parties agree that, with respect to documents presented which appear on their
face to be in substantial compliance with the terms of a Letter of Credit, the
Issuing Bank may, in its sole discretion, either accept and make payment upon
such documents without responsibility for further investigation, regardless of
any notice or information to the contrary, or refuse to accept and make payment
upon such documents if such documents are not in strict compliance with the
terms of such Letter of Credit.

(g)  Disbursement Procedures.  The Issuing Bank shall, promptly following
its receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit.  The
Issuing Bank shall promptly notify the Administrative Agent and the Company by
telephone (confirmed by telecopy) of such demand for payment and whether the
Issuing Bank has made or will make an LC Disbursement thereunder; provided
that any failure to give or delay in giving such notice

 30
 

 

shall not
relieve the Company of its obligation to reimburse the Issuing Bank and the US
Tranche Lenders with respect to any such LC Disbursement.

(h)  Interim Interest.  If the Issuing Bank shall make any LC
Disbursement, then, unless the Company shall reimburse such LC Disbursement in
full on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such LC Disbursement is
made to but excluding the date that the Company reimburses such LC
Disbursement, at the rate per annum then applicable to ABR Revolving Loans; provided
that, at all times after the Company fails to reimburse such LC Disbursement
when due pursuant to paragraph (e) of this Section, Section 2.13(g)
shall apply.  Interest accrued pursuant
to this paragraph shall be for the account of the Issuing Bank, except that
interest accrued on and after the date of payment by any US Tranche Lender
pursuant to paragraph (e) of this Section to reimburse the Issuing Bank shall
be for the account of such US Tranche Lender to the extent of such payment.

(i)  Replacement of the
Issuing Bank.  The Issuing Bank may
be replaced at any time by written agreement among the Company, the
Administrative Agent, the replaced Issuing Bank and the successor Issuing
Bank.  The Administrative Agent shall
notify the Lenders of any such replacement of the Issuing Bank.  At the time any such replacement shall become
effective, the Company shall pay all unpaid fees accrued for the account of the
replaced Issuing Bank pursuant to Section 2.12(b).  From and after the effective date of any such
replacement, (i) the successor Issuing Bank shall have all the rights and obligations
of the Issuing Bank under this Agreement with respect to Letters of Credit to
be issued thereafter and (ii) references herein to the term “Issuing Bank”
shall be deemed to refer to such successor or to any previous Issuing Bank, or
to such successor and all previous Issuing Banks, as the context shall
require.  After the replacement of an
Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto
and shall continue to have all the rights and obligations of an Issuing Bank
under this Agreement with respect to Letters of Credit issued by it prior to
such replacement, but shall not be required to issue additional Letters of
Credit.

(j)  Cash Collateralization.  If the US Tranche Commitments shall be
terminated on the Business Day that the Company receives notice from the
Administrative Agent or the Required Lenders (or, if the maturity of the Loans
has been accelerated, US Tranche Lenders with LC Exposure representing greater
than 50% of the total LC Exposure) demanding the deposit of cash collateral
pursuant to this paragraph, the Company shall deposit in an account with the
Administrative Agent, in the name of the Administrative Agent and for the
benefit of the US Tranche Lenders, an amount in cash equal to the LC Exposure
as of such date plus any accrued and unpaid interest thereon; provided
that the obligation to deposit such cash collateral shall become effective
immediately, and such deposit shall become immediately due and payable, without
demand or other notice of any kind, upon the occurrence of any Event of Default
with respect to the Company described in clause (f) or (g) of
Article VII.  Such deposit shall be
held by the Administrative Agent as collateral for the payment and performance
of the obligations of the Company under this Agreement.  The Administrative Agent shall have exclusive
dominion and control, including the exclusive right of withdrawal, over

 31
 

 

such
account.  Other than any interest earned
on the investment of such deposits, which investments shall be made at the option
and sole discretion of the Administrative Agent and at the Company’s risk and
expense, such deposits shall not bear interest. 
Interest or profits, if any, on such investments shall accumulate in
such account.  Moneys in such account
shall be applied by the Administrative Agent to reimburse the Issuing Bank for
LC Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations of
the Company for the LC Exposure at such time or, if the maturity of the Loans
has been accelerated (but subject to the consent of US Tranche Lenders with LC
Exposures representing greater than 50% of the total LC Exposure) be applied to
satisfy other obligations of the Company under this Agreement.  If the Company is required to provide an
amount of cash collateral hereunder as a result of the occurrence of an Event
of Default, such amount (to the extent not applied as aforesaid) shall be
returned to them within three Business Days after all Events of Default have
been cured or waived.

SECTION 2.06.  Funding of
Borrowings.  (a)  Each Lender shall make each Loan to be made
by it hereunder on the proposed date thereof by wire transfer of immediately
available funds in the applicable currency by 11:00 a.m., Local Time, to
the account of the Applicable Agent most recently designated by it for such
purpose for Loans of such Class and currency by notice to the applicable
Lenders.  The Applicable Agent will make
such Loans available to the relevant Borrower by promptly crediting the amounts
so received, in like funds, to an account of such Borrower maintained by the
Applicable Agent (i) in New York City, in the case of Loans denominated in US
Dollars (ii) in London, in the case of Eurocurrency or Fixed Rate Loans
denominated in any Designated Foreign Currency and (iii) in Tokyo, in the case
of TIBOR or Yen Base Rate Revolving Loans; provided that US Tranche
Revolving Loans made to finance the reimbursement of an LC Disbursement shall
be remitted by the Administrative Agent to the Issuing Bank.

(b)  Unless the Applicable Agent shall have
received notice from a Lender prior to the proposed date of any Borrowing that
such Lender will not make available to the Applicable Agent such Lender’s share
of such Borrowing, the Applicable Agent may assume that such Lender has made
such share available on such date in accordance with paragraph (a) of this
Section and may, in reliance upon such assumption, make available to the
relevant Borrower a corresponding amount. 
In such event, if a Lender has not in fact made its share of the
applicable Borrowing available to the Applicable Agent, then the applicable
Lender and such Borrower severally agree to pay to the Applicable Agent
forthwith on demand such corresponding amount with interest thereon, for each
day from and including the date such amount is made available to such Borrower
to but excluding the date of payment to the Applicable Agent, at (i) in the
case of such Lender, the rate reasonably determined by the Applicable Agent to
be the cost to it of funding such amount or (ii) in the case of such
Borrower, the interest rate applicable to the subject Loan.  If such Lender pays such amount to the
Applicable Agent, then such amount shall constitute such Lender’s Loan included
in such Borrowing and the Applicable Agent shall return to such Borrower any
amount (including interest) paid by such Borrower to the Applicable Agent
pursuant to this paragraph.

 32
 

 

SECTION 2.07.  Repayment of
Borrowings; Evidence of Debt. 
(a)  Each Borrower hereby
unconditionally promises to pay to the Applicable Agent for the accounts of the
applicable Lenders (i) the then unpaid principal amount of each Revolving
Borrowing of such Borrower on the Maturity Date and (ii) the then unpaid
principal amount of each Competitive Loan on the last day of the Interest
Period applicable thereto.  Each Borrower
agrees to repay the principal amount of each Loan made to such Borrower and the
accrued interest thereon in the currency of such Loan.

(b)  Each Lender shall maintain
in accordance with its usual practice an account or accounts evidencing the
indebtedness of each Borrower to such Lender resulting from each Loan made by
such Lender, including the amounts of principal and interest payable and paid
to such Lender from time to time hereunder.

(c)  The Administrative Agent
shall maintain accounts in which it shall record (i) the amount of each
Loan made hereunder, the Class, Type and currency thereof and the Interest
Period applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from each Borrower to each Lender
hereunder and (iii) the amount of any sum received by any Agent hereunder
for the accounts of the Lenders and each Lender’s share thereof.  Each of the London Agent and the Tokyo Agent
shall furnish to the Administrative Agent, promptly after the making of any
Loan or Borrowing with respect to which it is the Applicable Agent or the
receipt of any payment of principal or interest with respect to any such Loan
or Borrowing, information with respect thereto that will enable the
Administrative Agent to maintain the accounts referred to in the preceding
sentence.  The Administrative Agent shall
notify in writing the London Agent or the Tokyo Agent, as applicable, promptly
after the making of any Loan or Borrowing with respect to which it is the
Applicable Agent or the receipt of payment of any principal with respect to any
such Loan or Borrowing.

(d)  The entries made in the
accounts maintained pursuant to paragraph (b) or (c) of this Section
shall be prima  facie evidence of the existence and amounts of the
obligations recorded therein; provided that the failure of any Lender or
the Administrative Agent to maintain such accounts or any error therein shall not
in any manner affect the obligation of any Borrower to repay the Loans in
accordance with the terms of this Agreement.

(e)  Any Lender may request that
Loans of any Class made by it to any Borrower be evidenced by a promissory
note.  In such event, each applicable
Borrower shall prepare, execute and deliver to such Lender a promissory note
payable to the order of such Lender (or, if requested by such Lender, to such
Lender and its registered assigns) and in a form approved by the Administrative
Agent.  Thereafter, the Loans evidenced
by each such promissory note and interest thereon shall at all times (including
after assignment pursuant to Section 11.04) be represented by one or more
promissory notes in such form payable to the order of the payee named therein
(or, if such promissory note is a registered note, to such payee and its
registered assigns).

SECTION
2.08.  Interest Elections.  (a) 
Each Revolving Borrowing initially shall be of the Type specified in the
applicable Borrowing Request and, in the

 33
 

 

case of a
Eurocurrency Borrowing or TIBOR Borrowing, shall have an initial Interest
Period as specified in such Borrowing Request. 
Thereafter, the relevant Borrower may elect to convert such Borrowing to
a different Type or to continue such Borrowing and, in the case of a
Eurocurrency Borrowing or TIBOR Borrowing, may elect Interest Periods therefor,
all as provided in this Section and on terms consistent with the other
provisions of this Agreement.  A Borrower
may elect different options with respect to different portions of an affected
Borrowing, in which case each such portion shall be allocated ratably among the
Lenders holding the Loans comprising such Borrowing, and the Loans comprising
each such portion shall be considered a separate Revolving Borrowing.

(b)  To make an election pursuant
to this Section, a Borrower, or the Company on its behalf, shall notify the
Applicable Agent of such election by telephone by the time that a Borrowing
Request would be required under Section 2.03 if such Borrower were
requesting a Revolving Borrowing of the Type resulting from such election to be
made on the effective date of such election. 
Each such telephonic Interest Election Request shall be irrevocable and
shall be confirmed promptly by hand delivery or telecopy to the Applicable
Agent of a written Interest Election Request in a form approved by the
Administrative Agent and signed by the relevant Borrower, or the Company on its
behalf.  Notwithstanding any contrary
provision herein, this Section shall not be construed to permit any Borrower to
(i) change the currency of any Borrowing, (ii) elect an Interest
Period for Eurocurrency Loans or TIBOR Loans that does not comply with
Section 2.02(d) or (iii) convert any Borrowing to a Borrowing of a
Type not available under the Class of Commitments pursuant to which such
Borrowing was made.

(c)  Each telephonic and written
Interest Election Request shall specify the following information in compliance
with Section 2.02:

(i) the Borrowing to which such Interest Election Request
applies and, if different options are being elected with respect to different
portions thereof, the portions thereof to be allocated to each resulting
Borrowing (in which case the information to be specified pursuant to clauses
(iii) and (iv) below shall be specified for each resulting Borrowing);

(ii) the effective date of the election made pursuant to
such Interest Election Request, which shall be a Business Day;

(iii) the Type of the resulting Borrowing; and

(iv) if the resulting Borrowing is to be a Eurocurrency
Borrowing or a TIBOR Borrowing, the Interest Period to be applicable thereto
after giving effect to such election, which shall be a period contemplated by
the definition of the term “Interest Period”.

If any such
Interest Election Request requests a Eurocurrency Borrowing or a TIBOR
Borrowing but does not specify an Interest Period, then the Borrower shall be
deemed to have selected an Interest Period of one month’s duration.

 34
 

 

(d)  Promptly following receipt
of an Interest Election Request, the Applicable Agent shall advise each Lender
holding a Loan to which such request relates of the details thereof and of such
Lender’s portion of each resulting Borrowing.

(e)  If the relevant Borrower
fails to deliver a timely Interest Election Request with respect to a
Eurocurrency Borrowing or TIBOR Borrowing prior to the end of the Interest
Period applicable thereto, then, unless such Borrowing is repaid as provided
herein, at the end of such Interest Period, such Borrowing shall (i) in the
case of a Borrowing denominated in US Dollars, be converted to an ABR
Borrowing, (ii) in the case of a Japanese Tranche Revolving Borrowing
denominated in Yen, be converted into a Yen Base Rate Revolving Borrowing and
(iii) in the case of any other Eurocurrency Borrowing, become due and payable
on the last day of such Interest Period.

SECTION 2.09.  Termination and
Reduction of Commitments.  (a)  Unless previously terminated, the Commitments
shall terminate on the Maturity Date; provided that the Commitments
shall terminate at 5:00 p.m., New York City time, on September 30,
2006, if the Effective Date shall not have occurred prior to such time.

(b)  The Company may at any time
terminate, or from time to time reduce, the Commitments of any Class; provided
that (i) each reduction of the Commitments of any Class shall be in an amount
that is an integral multiple of the Borrowing Multiple and not less than the
Borrowing Minimum, (ii) the Company shall not terminate or reduce the US
Tranche Commitments if, after giving effect to any concurrent prepayment of the
US Tranche Revolving Loans in accordance with Section 2.11, the sum of the
aggregate US Tranche Revolving Exposures and the aggregate Competitive Loan
Exposures would exceed the aggregate US Tranche Commitments, (iii) the
Company shall not terminate or reduce the Swiss Tranche Commitments if, after
giving effect to any concurrent prepayment of the Swiss Tranche Revolving Loans
in accordance with Section 2.11, the aggregate Swiss Tranche Exposures
would exceed the aggregate Swiss Tranche Commitments and (iv) the Company
shall not terminate or reduce the Japanese Tranche Commitments if, after giving
effect to any concurrent prepayment of the Japanese Tranche Revolving Loans in
accordance with Section 2.11, the aggregate Japanese Tranche Exposures
would exceed the aggregate Japanese Tranche Commitments.

(c)  The Company shall notify the Administrative
Agent of any election to terminate or reduce the Commitments of any Class under
paragraph (b) of this Section at least three Business Days prior to the
effective date of such termination or reduction, specifying the effective date
of such election.  Promptly following
receipt of any such notice, the Administrative Agent shall advise the other
Agents and the applicable Lenders of the contents thereof.  Each notice delivered by the Company pursuant
to this Section shall be irrevocable; provided that a notice of
termination of the Commitments delivered by the Company may state that such
notice is conditioned upon the effectiveness of other credit facilities, in
which case such notice may be revoked by the Company (by notice to the
Administrative Agent on or prior to the specified effective date) if such
condition is not satisfied.  Any termination
or reduction of the Commitments of any Class shall be permanent.  Each reduction of the Commitments of any
Class shall be made ratably

 35
 

 

among the
applicable Lenders in accordance with their respective Commitments of such
Class.

SECTION 2.10.  Increase in
Commitments.  (a)  The Company may, by written notice to the
Administrative Agent (which shall promptly deliver a copy to each of the
Lenders), request that the total US Tranche Commitments, Swiss Tranche
Commitments or Japanese Tranche Commitments be increased by an amount not less than
$25,000,000 for any such increase; provided that after giving effect to
any such increase the sum of the total Commitments shall not exceed
$750,000,000.  Such notice shall set
forth the amount of the requested increase in the total US Tranche Commitments,
Swiss Tranche Commitments or Japanese Tranche Commitments, as the case may be,
and the date on which such increase is requested to become effective (which
shall be not less than 30 Business Days or more than 60 days after the date of
such notice), and shall offer each Lender the opportunity to increase its
Commitment by its US Tranche Percentage, Swiss Tranche Percentage or Japanese
Tranche Percentage, as the case may be, of the proposed increased amount.  Each Lender shall, by notice to the Company
and the Administrative Agent given not more than 10 Business Days after the
date of the Company’s notice, either agree to increase its applicable
Commitment by all or a portion of the offered amount (each Lender so agreeing
being an “Increasing Lender”) or decline to increase its applicable
Commitment (and any Lender that does not deliver such a notice within such
period of 10 Business Days shall be deemed to have declined to increase its
Commitment) (each Lender so declining or deemed to have declined being a “Non-Increasing
Lender”).  In the event that, on the
10th Business Day after the Company shall have delivered a notice pursuant to
the first sentence of this paragraph, the Lenders shall have agreed pursuant to
the preceding sentence to increase their Commitments by an aggregate amount
less than the increase in the total Commitments requested by the Company, the
Company may arrange for one or more banks or other financial institutions (any
such bank or other financial institution being called an “Augmenting Lender”),
which may include any Lender, to extend US Tranche Commitments, Swiss Tranche
Commitments or Japanese Tranche Commitments, as the case may be, or increase
their existing US Tranche Commitments, Swiss Tranche Commitments or Japanese
Tranche Commitments, as the case may be, in an aggregate amount equal to the
unsubscribed amount; provided that each Augmenting Lender, if not
already a Lender hereunder, shall be subject to the approval of the
Administrative Agent (which approval shall not be unreasonably withheld) and
the Borrowers and each Augmenting Lender shall execute all such documentation
as the Administrative Agent shall reasonably specify to evidence the Commitment
of such Augmenting Lender and/or its status as a Lender hereunder.  Any increase in the total US Tranche
Commitments, Swiss Tranche Commitments or Japanese Tranche Commitments, as the
case may be, may be made in an amount which is less than the increase requested
by the Company if the Company is unable to arrange for, or chooses not to
arrange for, Augmenting Lenders.

(b)  On the effective date (the “Increase
Effective Date”) of any increase in the total US Tranche Commitments, Swiss
Tranche Commitments or Japanese Tranche Commitments pursuant to this
Section 2.10 (the “Commitment Increase”), (i) the aggregate
principal amount of the US Tranche Revolving Loans, Swiss Tranche

 36
 

 

Revolving
Loans or Japanese Tranche Revolving Loans, as the case may be, outstanding (the
“Initial Loans”) immediately prior to giving effect to the Commitment Increase
on the Increase Effective Date shall be deemed to be paid, (ii) each
Increasing Lender and each Augmenting Lender that shall have been a US Tranche
Lender, Swiss Tranche Lender or Japanese Tranche Lender, as the case may be,
prior to the Commitment Increase shall pay to the Administrative Agent or
another Agent designated by the Administrative Agent for such purpose in same
day funds an amount equal to the difference between (A) the product of
(1) such Lender’s US Tranche Percentage, Swiss Tranche Percentage or
Japanese Tranche Percentage, as the case may be (calculated after giving effect
to the Commitment Increase), multiplied by (2) the amount of the
Subsequent Borrowings (as hereinafter defined) and (B) the product of
(1) such Lender’s US Tranche Percentage, Swiss Tranche Percentage or
Japanese Tranche Percentage, as the case may be (calculated without giving
effect to the Commitment Increase), multiplied by (2) the amount of the
Initial Loans, (iii) each Augmenting Lender that shall not have been a
Lender prior to the Commitment Increase shall pay to the Administrative Agent
or another Agent designated by the Administrative Agent for such purpose in
same day funds an amount equal to the product of (1) such Augmenting
Lender’s US Tranche Percentage, Swiss Tranche Percentage or Japanese Tranche
Percentage (calculated after giving effect to the Commitment Increase)
multiplied by (2) the amount of the Subsequent Borrowings, and
(iv) after the Administrative Agent or other Agent receives the funds
specified in clauses (ii) and (iii) above, the Administrative Agent or
such other Agent shall pay to each Non-Increasing Lender the portion of such
funds that is equal to the difference between (A) the product of
(1) such Non-Increasing Lender’s US Tranche Percentage, Swiss Tranche
Percentage or Japanese Tranche Percentage (calculated without giving effect to
the Commitment Increase) multiplied by (2) the amount of the Initial
Loans, and (B) the product of (1) such Non-Increasing Lender’s US
Tranche Percentage, Swiss Tranche Percentage or Japanese Tranche Percentage
(calculated after giving effect to the Commitment Increase) multiplied by
(2) the amount of the Subsequent Borrowings, (v) after the
effectiveness of the Commitment Increase, the applicable Borrowers shall be
deemed to have made new Borrowings (the “Subsequent Borrowings”) in an
aggregate principal amount equal to the aggregate principal amount of the
Initial Loans and of the types and for the Interest Periods specified in a
Borrowing Request delivered to the Administrative Agent in accordance with
Section 2.04, (vi) each Non-Increasing Lender, each Increasing Lender
and each Augmenting Lender shall be deemed to hold its US Tranche Percentage,
Swiss Tranche Percentage or Japanese Tranche Percentage, as the case may be, of
each Subsequent Borrowing (each calculated after giving effect to the
Commitment Increase) and (vii) the applicable Borrowers shall pay each
Increasing Lender and each Non-Increasing Lender any and all accrued but unpaid
interest on the Initial Loans.  The
deemed payments made pursuant to clause (i) above in respect of each
Eurocurrency Loan or TIBOR Loan shall be subject to indemnification by the
Borrowers pursuant to the provisions of Section 2.16 if the Increase
Effective Date occurs other than on the last day of the Interest Period
relating thereto and breakage costs result.

(c)  Increases and new
Commitments created pursuant to this Section 2.10 shall become effective
on the date specified in the notice delivered by the Company pursuant to the
first sentence of paragraph (a) above.

 37

 

(d)  Notwithstanding the
foregoing, no increase in the Commitments of any Class (or in any Commitment of
any Lender) or addition of an Augmenting Lender shall become effective under
this Section unless, (i) on the date of such increase, the conditions set forth
in paragraphs (a) and (b) of Section 4.02 shall be satisfied and the
Administrative Agent shall have received a certificate to that effect dated
such date and executed by the chief financial officer of the Company, and
(ii) the Administrative Agent shall have received (with sufficient copies
for each of the Lenders) documents consistent with those delivered on the
Effective Date under clauses (b) and (c) of Section 4.01 as to the
corporate power and authority of the applicable Borrowers to borrow hereunder
after giving effect to such increase.

SECTION 2.11.  Prepayment of
Loans.  (a)  Any Borrower shall have the right at any time
and from time to time to prepay any Borrowing of such Borrower in whole or in
part, subject to prior notice in accordance with paragraph (d) of this Section;
provided, that Competitive Loans may be prepaid only with the consent of
the Lenders making such Loans.

(b)  If the aggregate Exposures
of any Class shall exceed the aggregate Commitments of such Class (reduced, in
the case of the US Tranche Commitments, by the aggregate amount of the US
Tranche Lenders’ Competitive Loan Exposures), then (i) on the last day of any
Interest Period for any Eurocurrency Revolving Borrowing or TIBOR Borrowing of
such Class and (ii) on any other date in the event ABR Revolving Borrowings or
Yen Base Rate Revolving Borrowings shall be outstanding under such Class, the
applicable Borrowers shall prepay Revolving Loans or Competitive Loans of such
Class in an amount equal to the lesser of (A) the amount necessary to
eliminate such excess (after giving effect to any other prepayment of Loans on
such day) and (B) the amount of the applicable Borrowings referred to in
clause (i) or (ii), as applicable.  If, on
any Reset Date, the aggregate amount of the Exposures of any Class shall exceed
105% of the aggregate Commitments of such Class (reduced, in the case of the US
Tranche Commitments, by the aggregate amount of the US Tranche Lenders’
Competitive Loan Exposures), then the applicable Borrowers shall, not later
than the next Business Day, prepay one or more Borrowings of such Class in an
aggregate principal amount sufficient to eliminate such excess.

(c)  Prior to any optional or
mandatory prepayment of Borrowings hereunder, the applicable Borrower shall
select the Borrowing or Borrowings to be prepaid and shall specify such
selection in the notice of such prepayment pursuant to paragraph (d) of
this Section.

(d)  The applicable Borrower, or
the Company on behalf of the applicable Borrower, shall notify the Applicable
Agent by telephone (confirmed by telecopy) of any prepayment of a Borrowing
hereunder (i) in the case of a Eurocurrency Borrowing, not later than
11:00 a.m., Local Time, three Business Days before the date of such
prepayment, (b) in the case of a TIBOR Borrowing, not later than 5:00 p.m.,
Local Time, four Business Days before the date of such prepayment, and
(c) in the case of an ABR Borrowing or a Yen Base Rate Revolving
Borrowing, not later than 11:00 a.m., Local Time, one Business Day before the
date of such prepayment.  Each such
notice shall be

 38
 

 

irrevocable
and shall specify the prepayment date and the principal amount of each
Borrowing or portion thereof to be prepaid; provided that, if a notice
of optional prepayment is given in connection with a conditional notice of
termination of the Commitments as contemplated by Section 2.09(c), then
such notice of prepayment may be revoked if such notice of termination is
revoked in accordance with Section 2.09(c).  Promptly following receipt of any such
notice, the Applicable Agent shall advise the applicable Lenders of the
contents thereof.  Each partial
prepayment of any Borrowing shall be in an amount that would be permitted in
the case of an advance of a Borrowing of the same Type as provided in
Section 2.02.  Each prepayment of a
Borrowing shall be applied ratably to the Loans included in the prepaid
Borrowing.  Prepayments shall be
accompanied by (i) accrued interest to the extent required by
Section 2.13 and (ii) break funding payments pursuant to
Section 2.16.

SECTION 2.12.  Fees.  (a) 
The Company agrees to pay to the Administrative Agent for the account of
each Lender a facility fee, which shall accrue at the Applicable Rate on the
daily amount of the Commitments of such Lender (whether used or unused) during
the period from and including the date hereof to but excluding the date on
which the last of such Commitments terminates; provided that, if such
Lender continues to have any Exposure of any Class after its Commitment of such
Class terminates, then such facility fee shall continue to accrue on the daily
amount of such Lender’s Exposure of such Class to but excluding the date on
which such Lender ceases to have any such Exposure.  Accrued facility fees shall be payable in
arrears on the last day of March, June, September and December of each year,
commencing on the first such date to occur after the date hereof, and on the
date on which all the Commitments shall have terminated and the Lenders shall
have no further Exposures.  All facility
fees shall be computed on the basis of a year of 360 days and shall be payable
for the actual number of days elapsed (including the first day but excluding
the last day).  For purposes of computing
facility fees with respect to US Tranche Commitments, a US Tranche Commitment
of a Lender shall be deemed to be used to the extent of the outstanding US
Tranche Revolving Loans and the LC Exposure of such Lender.

(b)  The Company agrees to pay
(i) to the Administrative Agent for the account of each US Tranche Lender a
participation fee with respect to its participations in Letters of Credit,
which shall accrue at the Applicable Rate used to determine the interest rate
applicable to US Tranche Eurocurrency Revolving Loans on the daily amount of
such US Tranche Lender’s LC Exposure (excluding any portion thereof
attributable to unreimbursed LC Disbursements) during the period from and
including the date hereof to but excluding the later of the date on which such
US Tranche Lender’s US Tranche Commitment terminates and the date on which such
Lender ceases to have any LC Exposure, and (ii) to the Issuing Bank a fronting
fee, which shall accrue at the rate of 0.125% per annum on the average daily
amount of the LC Exposure (excluding any portion thereof attributable to unreimbursed
LC Disbursements) during the period from and including the date hereof to but
excluding the later of the date of termination of the US Tranche Commitments
and the date on which there ceases to be any LC Exposure, as well as the
Issuing Bank’s standard fees with respect to the issuance, amendment, renewal
or extension of any Letter of Credit or processing of drawings thereunder.  Participation fees and fronting fees accrued
under this paragraph through and including

 39
 

 

the last day
of March, June, September and December of each year shall be payable on such
last day, commencing on the first such date to occur after the date hereof; provided
that all such fees shall be payable on the date on which the US Tranche
Commitments terminate and any such fees accruing after the date on which the US
Tranche Commitments terminate shall be payable on demand.  Any other fees payable to the Issuing Bank
pursuant to this paragraph shall be payable within 10 days after demand.  All participation fees and fronting fees
payable under this paragraph shall be computed on the basis of a year of 360
days and shall be payable for the actual number of days elapsed (including the
first day but excluding the last day).

(c)  The Company agrees to pay to
the Administrative Agent, for its own account, fees payable in the amounts and
at the times separately agreed upon between the Company and the Administrative
Agent.

(d)  All fees payable hereunder
shall be paid on the dates due, in immediately available funds, to the
Administrative Agent (or to the Issuing Bank, in the case of fees payable to
it) for distribution, in the case of facility fees, to the Lenders.  Fees paid shall not be refundable under any
circumstances.

SECTION 2.13.  Interest.  (a) 
The Loans comprising each ABR Borrowing shall bear interest at the
Alternate Base Rate plus the Applicable Rate.

(b)  The Loans comprising each
Yen Base Rate Borrowing shall bear interest at the Yen Base Rate plus the
Applicable Rate.

(c)  The Loans comprising each
Eurocurrency Borrowing shall bear interest (i) in the case of a Eurocurrency
Revolving Borrowing, at the LIBO Rate for the Interest Period in effect for
such Borrowing plus the Applicable Rate, or (ii) in the case of a Eurocurrency
Competitive Loan, at the LIBO Rate for the Interest Period in effect for such
Borrowing plus (or minus, as applicable) the Margin applicable to such Loan.

(d)  The Loans comprising each
TIBOR Borrowing shall bear interest at the TIBO Rate for the Interest Period in
effect for such Borrowing plus the Applicable Rate.

(e)  Each Fixed Rate Loan shall
bear interest at the Fixed Rate applicable to such Loan.

(f)  Notwithstanding the
foregoing, if any principal of or interest on any Loan or any fee payable by
any Borrower hereunder is not paid when due, whether at stated maturity, upon
acceleration or otherwise, such overdue amount shall bear interest, after as
well as before judgment, at a rate per annum equal to (i) in the case of
overdue principal of any Loan, 2% per annum plus the rate otherwise applicable to
such Loan as provided in the preceding paragraphs of this Section or (ii) in
the case of any other amount, 2% plus the rate applicable to ABR Revolving
Loans as provided in paragraph (a) above.

 40
 

 

(g)  Accrued interest on each
Loan shall be payable in arrears on each Interest Payment Date for such Loan; provided
that (i) interest accrued pursuant to paragraph (g) above shall be payable on
demand, (ii) in the event of any repayment or prepayment of any Loan (other
than a prepayment of an ABR Revolving Loan prior to the end of the Revolving
Availability Period), accrued interest on the principal amount repaid or
prepaid shall be payable on the date of such repayment or prepayment and (iii)
in the event of any conversion of any Eurocurrency Revolving Loan or TIBOR
Revolving Loan prior to the end of the current Interest Period therefor,
accrued interest on such Loan shall be payable on the effective date of such
conversion.

(h)  All interest hereunder shall
be computed on the basis of a year of 360 days, except that
(i) interest on Borrowings denominated in Sterling and Yen and
(ii) interest computed by reference to the Alternate Base Rate at times
when the Alternate Base Rate is based on the Prime Rate shall be computed on
the basis of a year of 365 days (or 366 days in a leap year), and in
each case shall be payable for the actual number of days elapsed (including the
first day but excluding the last day). 
The applicable Alternate Base Rate, Yen Base Rate, LIBO Rate or TIBO
Rate shall be determined by the Applicable Agent, and such determination shall
be conclusive absent manifest error.

SECTION 2.14.  Alternate Rate
of Interest.  If prior to the
commencement of any Interest Period for a Eurocurrency Borrowing or TIBOR
Borrowing denominated in any currency:

(a)  the Applicable Agent determines (which
determination shall be conclusive absent manifest error) that adequate and
reasonable means do not exist for ascertaining the LIBO Rate or the TIBO Rate,
as the case may be, for such Interest Period; or

(b)  the Applicable Agent is advised by a majority
in interest of the Lenders that would participate in such Borrowing that the
LIBO Rate or the TIBO Rate, as the case may be, for such Interest Period will
not adequately and fairly reflect the cost to such Lenders of making or
maintaining their Loans included in such Borrowing for such Interest Period;

then the Applicable Agent shall give notice thereof to
the applicable Borrower and the applicable Lenders by telephone or telecopy as
promptly as practicable thereafter and, until the Applicable Agent notifies the
applicable Borrower and the applicable Lenders that the circumstances giving
rise to such notice no longer exist, (i) any Interest Election Request that
requests the conversion of any Revolving Borrowing denominated in such currency
to, or continuation of any Revolving Borrowing denominated in such currency as,
a Eurocurrency Borrowing or TIBOR Borrowing, as the case may be, shall be
ineffective, and any Eurocurrency Borrowing or TIBOR Borrowing, as the case may
be, denominated in such currency that is requested to be continued shall be
repaid on the last day of the then current Interest Period applicable thereto,
and (ii) any Borrowing Request for a Eurocurrency Revolving Borrowing or TIBOR
Borrowing, as the case may be, denominated in such currency shall be
ineffective.

 41
 

 

SECTION 2.15.  Increased
Costs.  (a)  If any Change in Law shall:

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

(ii) impose on any Lender or the Issuing Bank or the
London or Tokyo interbank market any other condition affecting this Agreement
or Eurocurrency Loans or TIBOR Loans made by such Lender or any Letter of
Credit or participations therein;

and the result of any of the foregoing shall be to
increase the cost to such Lender of making or maintaining any Eurocurrency Loan
or TIBOR Loan (or of maintaining its obligation to make any such Loan) or to
increase the cost to such Lender or the Issuing Bank of participating in,
issuing or maintaining any Letter of Credit or to reduce the amount of any sum
received or receivable by such Lender or the Issuing Bank hereunder (whether of
principal, interest or otherwise), then the Company will pay or cause the other
Borrowers to pay to such Lender or the Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or the Issuing Bank
for such additional costs incurred or reduction suffered.

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

(c) 
Each Lender or the Issuing Bank shall determine the amount or amounts
necessary to compensate such Lender or the Issuing Bank or such Lender’s or the
Issuing Bank’s holding company, as the case may be, as specified in
paragraph (a) or (b) of this Section using the methods customarily used by
it for such purpose (and if such Lender or the Issuing Bank uses more than one
such method, the method used hereunder shall be that which most accurately
determines such amount or amounts).  A
certificate of a Lender or the Issuing Bank setting forth the amount or amounts
necessary to compensate such Lender or the Issuing Bank or such Lender’s or the
Issuing Bank’s holding company, as the case may be, as specified in
paragraph (a) or (b) of this Section, and setting forth in reasonable
detail the calculations used by such Lender or the Issuing Bank to determine
such amount, shall be delivered to the Company and shall be

 42
 

 

conclusive absent manifest error. 
The Company shall pay or cause the other Borrowers to pay to such Lender
or the Issuing Bank, as the case may be, the amount shown as due on any such
certificate within 15 Business Days after receipt thereof.

(d) 
Failure or delay on the part of any Lender or the Issuing Bank to demand
compensation pursuant to this Section shall not constitute a waiver of such
Lender’s or the Issuing Bank’s right to demand such compensation; provided
that the Company shall not be required to compensate a Lender or the Issuing
Bank pursuant to this Section for any increased costs or reductions incurred
more than 180 days prior to the date that such Lender or the Issuing Bank, as
the case may be, notifies the Borrower of the Change in Law giving rise to such
increased costs or reductions and delivers a certificate with respect thereto
as provided in paragraph (c) above; provided  further that, if the
Change in Law giving rise to such increased costs or reductions is retroactive,
then the 180-day period referred to above shall be extended to include the
period of retroactive effect thereof.

SECTION 2.16. 
Break Funding Payments.  In
the event of (a) the payment of any principal of any Eurocurrency Loan, TIBOR
Loan or Fixed Rate Loan other than on the last day of an Interest Period
applicable thereto (including as a result of an Event of Default), (b) the
conversion of any Eurocurrency Loan or TIBOR Loan to a Loan of a different Type
or Interest Period other than on the last day of the Interest Period applicable
thereto, (c) the failure to borrow, convert, continue or prepay any Loan on the
date specified in any notice delivered pursuant hereto (regardless of whether
such notice may be revoked under Section 2.11(d) and is revoked in
accordance therewith), or (d) the assignment or deemed assignment of any
Eurocurrency Loan, TIBOR Loan or Fixed Rate Loan other than on the last day of
the Interest Period applicable thereto as a result of a request by the Company
pursuant to Section 2.19 or the CAM Exchange, then, in any such event, the
applicable Borrower shall compensate each Lender for the loss, cost and expense
attributable to such event.  In the case
of a Eurocurrency Loan or TIBOR Loan, such loss, cost or expense to any Lender
shall be deemed to include an amount determined by such Lender to be the
excess, if any, of (i) the amount of interest that would have accrued on the
principal amount of such Loan had such event not occurred, at the LIBO Rate or
TIBO Rate that would have been applicable to such Loan, for the period from the
date of such event to the last day of the then current Interest Period therefor
(or, in the case of a failure to borrow, convert or continue, for the period
that would have been the Interest Period for such Loan), over (ii) the amount
of interest that would accrue on such principal amount for such period at the
interest rate such Lender would bid were it to bid, at the commencement of such
period, for deposits in the applicable currency of a comparable amount and
period from other banks in the London or Tokyo interbank market.  A certificate of any Lender setting forth any
amount or amounts that such Lender is entitled to receive pursuant to this
Section, and setting forth in reasonable detail the calculations used by such
Lender to determine such amount or amounts, shall be delivered to the
applicable Borrower and shall be conclusive absent manifest error.  The applicable Borrower shall pay such Lender
the amount shown as due on any such certificate within 15 Business Days after
receipt thereof.

 43
 

 

SECTION 2.17. 
Taxes.  (a)  Any and all payments by or on account of any
Borrower hereunder or under any other Loan Document shall be made free and
clear of and without deduction for any Indemnified Taxes or Other Taxes; provided
that if any Borrower shall be required to deduct any Indemnified Taxes or Other
Taxes from such payments, then (i) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section) the Administrative
Agent, the London Agent, the Tokyo Agent or the applicable Lender or Issuing
Bank, as the case may be, receives an amount equal to the sum it would have
received had no such deductions been made, (ii) such Borrower shall make
such deductions and (iii) such Borrower shall pay the full amount deducted
to the relevant Governmental Authority in accordance with applicable law.

(b)  In
addition, the Loan Parties shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.

(c) 
The relevant Borrower shall indemnify the Administrative Agent, the
London Agent, the Tokyo Agent and each Lender and the Issuing Bank, within 15
Business Days after written demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes paid by such Agent or such Lender or the
Issuing Bank, as the case may be, on or with respect to any payment by or on
account of any obligation of any Borrower hereunder or under any other Loan Document
(including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any penalties, interest
and reasonable expenses arising therefrom or with respect thereto, whether or
not such Indemnified Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority.  A certificate as to the amount of such
payment or liability setting forth in reasonable detail the circumstances
giving rise thereto and the calculations used by such Lender to determine the
amount thereof delivered to the Company by a Lender or the Issuing Bank, or by
an Agent, on its own behalf or on behalf of a Lender or the Issuing Bank, shall
be conclusive absent manifest error.

(d)  As
soon as practicable after any payment of Indemnified Taxes or Other Taxes by
any Borrower to a Governmental Authority, such Borrower shall deliver to the
Administrative Agent the original or a certified copy of a receipt issued by
such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.

(e) 
Any Lender that is entitled to an exemption from or reduction of
withholding tax under the law of the jurisdiction in which a Borrower is
located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to the Company (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law, such
properly completed and executed documentation prescribed by applicable law or
reasonably requested by the Company as will permit such payments to be made
without withholding or at a reduced rate; provided that such Lender has
received written notice from the Company advising it of the availability of
such exemption or reduction and containing all applicable documentation.

 44
 

 

(f) 
Each Lender, on the date it becomes a Lender hereunder, will designate
lending offices for the Loans to be made by it such that, on such date, it will
not be liable for (i) in the case of a US Tranche Lender, any withholding
tax that is imposed by the United States of America (or any political
subdivision thereof) on payments by a US Borrower from an office within such
jurisdiction, (ii) in the case of a Swiss Tranche Lender, any withholding
tax that is imposed (A) by Switzerland (or any political subdivision thereof)
on payments by a Swiss Borrower from an office within such jurisdiction or (B)
by the United States of America (or any political subdivision thereof) on
payments by a US Borrower from an office within such jurisdiction, or
(iii) in the case of a Japanese Tranche Lender, any withholding tax that
is imposed (A) by Japan (or any political subdivision thereof) on payments by a
Japanese Borrower from an office within such jurisdiction or (B) by the United
States of America (or any political subdivision thereof) on payments by a US
Borrower from an office within such jurisdiction.

SECTION 2.18. 
Payments Generally; Pro Rata Treatment; Sharing of Setoffs.  (a) 
Each Borrower shall make each payment required to be made by it
hereunder or under any other Loan Document (whether of principal, interest,
fees or reimbursement of LC Disbursements, or of amounts payable under
Section 2.15, 2.16 or 2.17, or otherwise) prior to 12:00 noon, Local Time,
on the date when due, in immediately available funds, without set-off or
counterclaim.  Any amounts received after
such time on any date may, in the discretion of the Applicable Agent, be deemed
to have been received on the next succeeding Business Day for purposes of
calculating interest thereon.  All such
payments shall be made to the Applicable Agent to the applicable account
specified in Schedule 2.18 or, in any such case, to such other account as the
Applicable Agent shall from time to time specify in a notice delivered to the
Company; provided that payments to be made directly to the Issuing Bank
as expressly provided herein and payments pursuant to Sections 2.15, 2.16,
2.17 and 11.03 shall be made directly to the Persons entitled thereto and
payments pursuant to other Loan Documents shall be made to the Persons
specified therein (it being agreed that the Borrowers will be deemed to have
satisfied their obligations with respect to payments referred to in this
proviso if they shall make such payments to the persons entitled thereto in
accordance with instructions provided by the Administrative Agent; the
Administrative Agent agrees to provide such instructions upon request, and no
Borrower will be deemed to have failed to make such a payment if it shall
transfer such payment to an improper account or address as a result of the
failure of the Administrative Agent to provide proper instructions).  The Applicable Agent shall distribute any
such payments received by it for the account of any Lender or other Person
promptly following receipt thereof at the appropriate lending office or other
address specified by such Lender or other Person.  If any payment hereunder shall be due on a
day that is not a Business Day, the date for payment shall be extended to the
next succeeding Business Day, and, in the case of any payment accruing
interest, interest thereon shall be payable for the period of such extension.  All payments hereunder of principal or
interest in respect of any Loan or LC Disbursement shall be made in the
currency of such Loan or LC Disbursement; all other payments hereunder and
under each other Loan Document shall be made in US Dollars.  Any payment required to be made by an Agent
hereunder shall be deemed to have been made by the time required if such Agent
shall, at or before such time, have taken the necessary steps to make such
payment in accordance with the regulations or operating

 45
 

 

procedures of the clearing or settlement system used by such Agent to
make such payment.  Any amount payable by
any Agent to one or more Lenders in the national currency of a member state of
the European Union that has adopted the Euro as its lawful currency shall be
paid in Euro.

(b)  If
any Lender shall, by exercising any right of set-off or counterclaim or
otherwise, obtain payment in respect of any principal of or interest on its US
Tranche Revolving Loans,  Swiss Tranche
Revolving Loans, Japanese Tranche Revolving Loans or participations in LC
Disbursements resulting in such Lender receiving payment of a greater
proportion of the aggregate amount of its US Tranche Revolving Loans, Swiss
Tranche Revolving Loans, Japanese Tranche Revolving Loans and participations in
LC Disbursements and accrued interest thereon than the proportion received by
any other Lender, then the Lender receiving such greater proportion shall
purchase (for cash at face value) participations in the US Tranche Revolving
Loans, Swiss Tranche Revolving Loans, Japanese Tranche Revolving Loans and
participations in LC Disbursements of other Lenders to the extent necessary so
that the benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of their respective US Tranche Revolving
Loans, Swiss Tranche Revolving Loans, Japanese Tranche Revolving Loans and
participations in LC Disbursements and accrued interest thereon; provided
that (i) if any such participations are purchased and all or any portion of the
payment giving rise thereto is recovered, such participations shall be
rescinded and the purchase price restored to the extent of such recovery,
without interest, and (ii) the provisions of this paragraph shall not be
construed to apply to any payment made by any Borrower pursuant to and in
accordance with the express terms of this Agreement or any payment obtained by
a Lender as consideration for the assignment of or sale of a participation in
any of its Loans or participations in LC Disbursements to any assignee or
participant, other than to the Company or any Subsidiary or Affiliate thereof
(as to which the provisions of this paragraph shall apply).  Each Borrower consents to the foregoing and
agrees, to the extent it may effectively do so under applicable law, that any
Lender acquiring a participation pursuant to the foregoing arrangements may
exercise against such Borrower rights of set-off and counterclaim with respect
to such participation as fully as if such Lender were a direct creditor of the
Borrower in the amount of such participation.

(c) 
Unless the Applicable Agent shall have received notice from the relevant
Borrower prior to the date on which any payment is due for the account of all
or certain of the Lenders or the Issuing Bank hereunder that such Borrower will
not make such payment, the Applicable Agent may assume that such Borrower has
made such payment on such date in accordance herewith and may, in reliance upon
such assumption, distribute to the applicable Lenders or the Issuing Bank, as
the case may be, the amount due.  In such
event, if such Borrower has not in fact made such payment, then each of the
applicable Lenders or the Issuing Bank, as the case may be, severally agrees to
repay to the Applicable Agent forthwith on demand the amount so distributed to
such Lender or Issuing Bank with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date
of payment to the Applicable Agent, at a rate determined by the Applicable
Agent in accordance with banking industry practices on interbank compensation.

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(d)  If
any Lender shall fail to make any payment required to be made by it to any
Agent pursuant to this Agreement, then the Agents may, in their discretion
(notwithstanding any contrary provision hereof), apply any amounts thereafter
received by them for the account of such Lender to satisfy such Lender’s
obligations to the Agents until all such unsatisfied obligations are fully
paid.

SECTION 2.19. 
Mitigation Obligations; Replacement of Lenders.  (a)  If
any Lender requests compensation under Section 2.15, or if any
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to
Section 2.17, then such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to
assign its rights and obligations hereunder to another of its offices, branches
or affiliates, if, in the judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to
Section 2.15 or 2.17, as the case may be, in the future and (ii) would not
subject such Lender to any unreimbursed cost or expense and would not otherwise
be disadvantageous to such Lender.  The
Company hereby agrees to pay all reasonable, direct, out-of-pocket costs and
expenses incurred by any Lender in connection with any such designation or
assignment.

(b)  If
any Lender requests compensation under Section 2.15, or if any Loan Party
is required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.17, or if
any Lender defaults in its obligation to fund Loans hereunder, then the Company
may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 11.04), all its interests, rights and obligations under the Loan Documents
to an assignee that shall assume such obligations (which assignee may be
another Lender, if a Lender accepts such assignment); provided that (i)
the Company shall have received the prior written consent of the Administrative
Agent (and if a Revolving Commitment is being assigned, the Issuing Bank),
which consent shall not be unreasonably withheld and (ii) such Lender shall
have received payment of an amount equal to the outstanding principal of its
Loans and participations in LC Disbursements, accrued interest thereon, accrued
fees and all other amounts payable to it hereunder, from the assignee or the
Company.  A Lender shall not be required
to make any such assignment and delegation if, prior thereto, as a result of a
waiver by such Lender or otherwise, the circumstances entitling the Company to
require such  assignment and delegation
cease to apply.

SECTION 2.20. 
Designation of US Borrowers, Swiss Borrowers and Japanese Borrowers.  The Company may at any time and from time to
time designate any US Subsidiary as a US Borrower, any Swiss Subsidiary as a
Swiss Borrower, or any Japanese Subsidiary as a Japanese Borrower, by delivery
to the Administrative Agent of a Borrowing Subsidiary Agreement executed by
such Subsidiary and the Company, and upon such delivery such Subsidiary shall
for all purposes of this Agreement be a US Borrower, a Swiss Borrower or a
Japanese Borrower, as the case may be, and a party to this Agreement until the
Company shall have executed and delivered to the Administrative Agent a Borrowing
Subsidiary Termination with respect to such

 47
 

 

Subsidiary, whereupon such Subsidiary shall cease to be a US Borrower,
a Swiss Borrower or a Japanese Borrower, as the case may be, and a party to
this Agreement.  Notwithstanding the
preceding sentence, no Borrowing Subsidiary Termination will become effective
as to any US Borrower, Swiss Borrower or Japanese Borrower at a time when any
principal of or interest on any Loan to such US Borrower, Swiss Borrower or
Japanese Borrower shall be outstanding hereunder, provided that such
Borrowing Subsidiary Termination shall be effective to terminate the right of
such US Borrower, Swiss Borrower or Japanese Borrower, as the case may be, to
request or receive further Borrowings under this Agreement.  As soon as practicable upon receipt of a
Borrowing Subsidiary Agreement, the Administrative Agent shall send a copy
thereof to each Lender.

ARTICLE
III

Representations
and Warranties

The Company and each other Borrower represents and
warrants as follows:

SECTION 3.01. 
Corporate Existence and Standing. 
The Company and each Material Subsidiary is duly organized, validly
existing and in good standing under the laws of its jurisdiction of
incorporation and has all requisite authority to conduct its business in each jurisdiction
in which the failure so to qualify would have a material adverse effect on the
business, properties, assets, operations or condition (financial or otherwise)
of the Company.

SECTION 3.02. 
Authorization; No Violation. 
The Transactions are within each Loan Party’s corporate or partnership
powers, have been duly authorized by all necessary corporate or partnership
action, and do not contravene (i) any Loan Party’s charter, by-laws or
other constitutive documents or (ii) any law or any contractual restriction
binding on or affecting any Loan Party.

SECTION 3.03. 
Governmental Consents.  No
authorization or approval or other action by, and no notice to or filing with,
any Governmental Authority or regulatory body is required for the due
execution, delivery and performance by the Loan Parties of this Agreement or
the other Loan Documents.

SECTION 3.04. 
Validity.  This Agreement
is, and the other Loan Documents when delivered will be, the legal, valid and
binding obligations of the Loan Parties party thereto, enforceable against such
Loan Parties in accordance with their respective terms, subject to the effect
of any applicable bankruptcy, insolvency, reorganization, moratorium or similar
law affecting creditors’ rights generally and to the effect of general
principles of equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law).

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SECTION 3.05.  Litigation.  There is no pending or, to the best of the
knowledge of the Borrowers, threatened action or proceeding affecting the
Company or any of its Subsidiaries before any court, governmental agency or
arbitrator, which could reasonably be expected to have a material adverse
effect on the financial condition or operations of the Company and the
Subsidiaries, taken as a whole, or which purports to affect the legality,
validity or enforceability of this Agreement or any other Loan Document.

SECTION 3.06.  Financial
Statements; No Material Adverse Change. 
(a)  The consolidated balance
sheets of the Company and its consolidated Subsidiaries at December 31, 2005,
and June 30, 2006, and the related consolidated statements of income and
stockholder’s equity for the fiscal year and the fiscal quarter, respectively,
then ended, copies of which have been furnished to each Lender, present fairly
the financial position of the Company and its consolidated Subsidiaries at
December 31, 2005, and June 30, 2006, and the results of the operations and
changes in financial position of the Company and its consolidated Subsidiaries
for the fiscal year and the fiscal quarter, respectively, then ended, in
conformity with GAAP consistently applied, subject, in the case of such
quarterly financial statements, to normal year-end audit adjustments and to the
absence of notes.

(b)  As of the date hereof there
has been, since December 31, 2005, no material adverse change in the
business, operations or financial condition of the Company and the
Subsidiaries, taken as a whole.

SECTION 3.07.  Investment
Company Act.  The Company is not
(i) an “investment company,” (ii) a company “controlled” by an “investment
company” which is registered under the Investment Company Act of 1940, as
amended, or (iii) to the best knowledge of the Company, a company “controlled”
by any other “investment company” within the meaning of the Investment Company
Act of 1940, as amended.

SECTION 3.08.  Regulation U.  Neither the Company nor any of the Subsidiaries
is engaged in the business of purchasing or carrying Margin Stock.  The value of the Margin Stock owned directly
or indirectly by the Company or any Subsidiary which is subject to any
arrangement hereunder is less than an amount equal to 25% of the value of all
assets of the Company and/or such Subsidiary subject to such arrangement (as
described in the definition of “Indirectly Secured” in Section 221.2 of
Regulation U issued by the Board of Governors of the Federal Reserve
System).

SECTION 3.09.  Environmental
Matters.  The operations of the
Company and each Material Subsidiary comply in all material respects with all
Environmental Laws, the noncompliance with which would materially adversely
affect the business of the Company or the ability of the Company to obtain
credit on commercially reasonable terms.

SECTION 3.10.  Disclosure.  None of the Confidential Information
Memorandum (including the Reports of the Company to the Securities and Exchange
Commission included therein) or any other written information prepared and
furnished by

 49
 

 

or on behalf
of the Loan Parties to any Agent or Lender in connection with the negotiation
of this Agreement or delivered hereunder (as modified or supplemented by other
information so furnished) contains as of the date thereof (or, in the case of
any such information that is not dated, the earliest date on which such
information is furnished to the Administrative Agent or any Lender) any
material misstatement of fact or omits to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; provided that, with respect to projected
financial information, the Company represents only that such information was
prepared in good faith based upon assumptions believed to be reasonable at the
time.

SECTION 3.11.  Subsidiary
Guarantors.  The Subsidiary
Guarantors include all the Material Subsidiaries, other than Foreign
Subsidiaries.

SECTION 3.12.  Solvency.  As of the Initial Borrowing Date, after
giving effect to the Borrowings hereunder on such date, (a) the fair value
of the assets of the Company and the Subsidiaries, at a fair valuation, will
exceed their debts and liabilities, subordinated, contingent or otherwise;
(b) the present fair saleable value of the property of the Company and the
Subsidiaries will be greater than the amount that will be required to pay the
probable liability in respect of their debts and other liabilities,
subordinated, contingent or otherwise, as such debts and other liabilities
become absolute and matured; (c) the Company and the Subsidiaries will be
able to pay their debts and liabilities, subordinated, contingent or otherwise,
as such debts and liabilities become absolute and matured; and (d) the
Company and the Subsidiaries will not have unreasonably small capital with
which to conduct the businesses in which they are engaged as such businesses
are now conducted and are proposed to be conducted.

SECTION 3.13.  Limitation of
Debt from  Lenders that are not Qualifying
Banks.  Each Swiss Borrower has Debt
owing to no more than twenty (20) Lenders that are not Qualifying Banks,
including for the purpose of this Section 3.13 any such Debt owing to
Affiliates of such Swiss Borrower.

ARTICLE IV

Conditions

SECTION 4.01.  Effective Date.  The obligations of the Lenders to make Loans
and of the Issuing Bank to issue Letters of Credit hereunder shall not become
effective until the date on which each of the following conditions has been
satisfied (or waived in accordance with Section 11.02):

(a)  The Administrative Agent (or its counsel)
shall have received from each party hereto either (i) a counterpart of
this Agreement signed on behalf of such party or (ii) written evidence
satisfactory to the Administrative Agent (which may include telecopy or
electronic transmission of a signed signature page of this Agreement) that such
party has signed a counterpart of this Agreement.

 50
 

 

(b)  The Administrative Agent shall have received
favorable written opinions (addressed to the Administrative Agent and the
Lenders and dated the Effective Date) of (i) Sidley Austin LLP, special
counsel for the Company, substantially in the form of Exhibit E-1, and
(ii) the Associate General Counsel of the Company, substantially in the
form of Exhibit E-2.  Each Loan
Party hereby requests such counsel to deliver such opinions.

(c)  The Administrative Agent shall have received
such documents and certificates as the Administrative Agent or its counsel may
reasonably request relating to the formation, existence and good standing of
the Loan Parties and the authorization of the Transactions, all in form and
substance satisfactory to the Administrative Agent and its counsel.

(d)  The Administrative Agent shall have received
(i) a certificate, dated the Effective Date and signed by the chief
financial officer of the Company, confirming that all the conditions set forth
in this Section 4.01 and in paragraphs (a) and (b) of Section 4.02
have been satisfied.

(e)  The Administrative Agent shall have received
all fees and other amounts due and payable on or prior to the Effective Date,
including, to the extent an invoice with respect thereto shall have been
received by the Company not fewer than five Business Days (or such lesser
number of days as the Company shall agree) prior to the Effective Date,
reimbursement or payment of all out-of-pocket expenses required to
be reimbursed or paid by the Company hereunder or under any other Loan
Document.

(f)  The Guarantee Requirement shall be satisfied.

(g)  The Company shall have (i) repaid in full the
principal of, and interest accrued on, all Loans (other than Japanese Tranche
Revolving Loans) and LC Disbursements (each as defined in the Existing Credit
Agreement) outstanding under the Existing Credit Agreement on the Effective Date,
together with all other amounts accrued and unpaid thereunder and (ii) paid all
accrued and unpaid fees and expenses subject to payment or reimbursement under
the Existing Credit Agreement.  All
Letters of Credit (as defined in the Existing Credit Agreement) issued under
the Existing Credit Agreement shall be terminated or shall have expired.

(h)  The Lenders shall have received all
documentation and other information required by bank regulatory authorities
under applicable “know your customer” and anti-money laundering rules and
regulations, including the U.S.A. Patriot Act.

The Administrative Agent shall notify the Company and
the Lenders of the Effective Date, and such notice shall be conclusive and
binding.  Notwithstanding the foregoing,
the obligations of the Lenders to make Loans and of the Issuing Bank to issue
Letters of

 51
 

 

Credit hereunder shall not become effective unless
each of the foregoing conditions is satisfied (or waived pursuant to
Section 11.02) on or prior to September 29, 2006.

SECTION 4.02.  Each Credit
Event.  The obligation of each Lender
to make a Loan on the occasion of each Borrowing, and of the Issuing Bank to
issue, amend, renew or extend any Letter of Credit, is subject to the
satisfaction of the following conditions:

(a)  The representations and warranties of the
Loan Parties set forth in the Loan Documents shall be true and correct on and
as of the date of such Borrowing or the date of issuance, amendment, renewal or
extension of such Letter of Credit, as applicable, other than representations
which are given as of a particular date, in which case the representation shall
be true and correct as of that date.

(b)  At the time of and immediately after giving
effect to such Borrowing or the issuance, amendment, renewal or extension of
such Letter of Credit, as applicable, and the application of the proceeds
thereof, no Default shall have occurred and be continuing.

Each Borrowing and each issuance, amendment, renewal
or extension of a Letter of Credit shall be deemed to constitute a
representation and warranty by the Borrower on the date thereof as to the
matters specified in paragraphs (a) and (b) of this Section.

SECTION 4.03.  Initial Credit
Event in Respect of each Borrower that is not a Borrower on the Effective Date.  The obligation of each Lender to make Loans
to each Borrower that is not a Borrower on the Effective Date is subject to the
satisfaction of the following conditions on the date of the initial Credit
Event in respect of such Borrower:

(a)  The Administrative Agent (or its counsel)
shall have received such Borrower’s Borrowing Subsidiary Agreement duly
executed by all parties thereto.

(b)  The Administrative Agent shall have received
such documents and certificates (including such legal opinions) as the
Administrative Agent or its counsel may reasonably request relating to the
formation, existence and good standing of such Borrower, the authorization of
the Transactions insofar as they relate to such Borrower and any other legal
matters relating to such Borrower, its Borrowing Subsidiary Agreement or such
Transactions, all in form and substance satisfactory to the Administrative
Agent and its counsel.

ARTICLE V

Affirmative
Covenants

Until the Commitments have expired or been terminated
and the principal of and interest on each Loan and all fees payable hereunder
shall have been paid in full

 52
 

 

and all Letters of Credit
shall have expired or terminated and all LC Disbursements shall have been
reimbursed, each Borrower covenants and agrees with the Lenders that it will:

SECTION 5.01.  Payment of
Taxes, Etc.  Pay and discharge, and
cause each Material Subsidiary to pay and discharge, before the same shall
become delinquent, (i) all taxes, assessments and governmental charges or
levies imposed upon it or upon its income, profit or property, and
(ii) all lawful claims which, if unpaid, might by law become a lien upon
its property; provided, however, that neither the Company nor any
Material Subsidiary shall be required to pay or discharge any such tax,
assessment, charge or claim which is being contested in good faith and by
proper proceedings and with respect to which the Company shall have established
appropriate reserves in accordance with GAAP.

SECTION 5.02.  Maintenance of
Insurance.  Maintain, and cause each
Material Subsidiary to maintain, insurance with responsible and reputable
insurance companies or associations in such amounts and covering such risks as
is usually carried by (or, as applicable, self-insure in a manner and to an
extent not inconsistent with conventions observed by) companies engaged in
similar businesses and owning similar properties in the same general areas in
which the Company or such Material Subsidiary operates.

SECTION 5.03.  Preservation of
Existence, Etc.  Preserve and
maintain, and cause each Material Subsidiary to preserve and maintain, its
corporate, limited liability company or partnership existence, rights (charter
and statutory), and franchises, except as otherwise permitted by Section 6.04.

SECTION 5.04.  Compliance with
Laws, Etc.  Comply, and cause each
Material Subsidiary to comply, with the requirements of all applicable laws,
rules, regulations and orders of any Governmental Authority (including, without
limitation, all Environmental Laws), noncompliance with which would materially
adversely affect the business of the Company and the Subsidiaries or the
ability of the Company to obtain credit on commercially reasonable terms.

SECTION 5.05.  Keeping of
Books.  Keep, and cause each Material
Subsidiary to keep, proper books of record and account, in which full and
correct entries shall be made of all financial transactions and the assets and
business of the Company and each Material Subsidiary in accordance with GAAP
consistently applied.

SECTION 5.06.  Inspection.  Permit, and cause each Material Subsidiary to
permit, the Administrative Agent, and its representatives and agents, to
inspect any of the properties, corporate books and financial records of the
Company and its Material Subsidiaries, to examine and make copies of the books
of account and other financial records of the Company and its Material
Subsidiaries, and to discuss the affairs, finances and accounts of the Company
and its Material Subsidiaries with, and to be advised as to the same by, their
respective officers or directors, at such reasonable times during normal
business hours and intervals as the Administrative Agent may reasonably
designate.

 53
 

 

SECTION 5.07.  Reporting
Requirements.  Furnish to the
Administrative Agent in sufficient copies for distribution to each Lender:

(a)  As soon as available and in any event within
55 days after the end of each of the first three quarters of each fiscal
year of the Company, a consolidated balance sheet of the Company and the
consolidated Subsidiaries as of the end of such quarter and a consolidated
statement of income and changes in financial position (or consolidated
statement of cash flow, as the case may be) of the Company and the consolidated
Subsidiaries for the period commencing at the end of the previous fiscal year
and ending with the end of such quarter, certified by the chief financial
officer of the Company;

(b)  As soon as available and in any event within
100 days after the end of each fiscal year of the Company, a consolidated
balance sheet of the Company and the consolidated Subsidiaries as of the end of
such year and a consolidated statement of income and stockholder’s equity and
changes in financial position of the Company and the consolidated Subsidiaries
for such fiscal year and accompanied by a report of PricewaterhouseCoopers LLC,
independent registered public accounting firm of the Company, or other
independent public accountants of nationally recognized standing, on the
results of their examination of the consolidated annual financial statements of
the Company and the consolidated Subsidiaries, which report shall be
unqualified or shall be otherwise reasonably acceptable to the Required
Lenders; provided that such report may set forth qualifications to the
extent such qualifications pertain solely to changes in GAAP from earlier
accounting periods, the implementation of which changes (with the concurrence
of such accountants) is reflected in the financial statements accompanying such
report;

(c)  Promptly after the sending or filing thereof,
copies of all reports which the Company files with the Securities and Exchange
Commission under the Securities Exchange Act of 1934, as amended, including,
without limitation, all such reports that disclose material litigation pending
against the Company or any Material Subsidiary or any material noncompliance
with any Environmental Law on the part of the Company or any Material
Subsidiary;

(d)  Together with the financial statements
required pursuant to clauses (a) and (b) above, a certificate signed by
the chief financial officer of the Company (A) stating that no Default
exists or, if any does exist, stating the nature and status thereof and
describing the action the Company proposes to take with respect thereto and
(B) demonstrating, in reasonable detail, the calculations used by such
officer to determine compliance with the financial covenants contained in
Sections 6.07 and 6.08;

(e)  With respect to each fiscal year for which
the Company shall have an aggregate Unfunded Liability of $10,000,000 or more
for all of its single employer pension benefit plans covered by Title IV
of ERISA and all multiemployer pension benefit plans covered by Title IV
of ERISA to which the

 54
 

 

Company has an obligation to contribute, as
soon as available, and in any event within ten months after the end of such
fiscal year, a statement of Unfunded Liabilities of each such plan, certified
as correct by an actuary enrolled in accordance with regulations under ERISA
and a statement of estimated withdrawal liability as of the most recent plan
year end as customarily prepared by the trustees under the multiemployer plans
to which the Company has an obligation to contribute;

(f)  As soon as possible, and in any event within
30 days after the occurrence of each event the Company knows is or may be
a reportable event (as defined in Section 4043 of ERISA, but excluding any
reportable event with respect to which the 30 day reporting requirement has
been waived) with respect to any plan with an Unfunded Liability in excess of
$10,000,000, a statement signed by the chief financial officer of the Company
describing such reportable event and the action which the Company proposes to
take with respect thereto;

(g)  As soon as possible, and in any event within
five Business Days after the Company shall become aware of the occurrence
of each Default, which Default is continuing on the date of such statement, a
statement of the chief financial officer of the Company setting forth details
of such Default or event and the action which the Company proposes to take with
respect thereto; and

(h)  From time to time, such other information as
to the business and financial condition of the Company and the Subsidiaries and
their compliance with the Loan Documents as any Agent, or any Lender through
the Administrative Agent, may reasonably request.

SECTION 5.08.  Use of Proceeds
and Letters of Credit.  Use the
proceeds of Borrowings hereunder and the Letters of Credit for the purposes
referred to in the recitals to this Agreement, and not for any purpose that
would entail a violation of any applicable law or regulation (including,
without limitation, Regulations U and X of the Board).  With respect to any Borrowing the proceeds of
which shall be used to purchase or carry Margin Stock, the applicable Borrower
shall include in the Borrowing Request for such Borrowing such information as
shall enable the Lenders and the Borrowers to determine that they are in
compliance with such Regulations U and X.

SECTION 5.09.  Guarantee
Requirement.  Cause the Guarantee
Requirement to be satisfied at all times.

SECTION 5.10.  Limitation of
Debt From Lenders That Are Not Qualifying Banks.  Each Swiss Borrower shall have Debt owing to
no more than twenty (20) lenders that are not Qualifying Banks, including for
the purposes of this Section 5.10 any such Debt owing to Affiliates of
such Swiss Borrower.

 55
 

 

ARTICLE VI

Negative Covenants

Until the Commitments have expired or terminated and
the principal of and interest on each Loan and all fees payable hereunder have
been paid in full and all Letters of Credit have expired or terminated and all
LC Disbursements shall have been reimbursed, each Borrower covenants and agrees
with the Lenders that it will not:

SECTION 6.01.  Subsidiary
Debt.  Permit any Material Subsidiary
that is not a Subsidiary Guarantor to create, incur, assume or permit to exist
any Debt, except:

(a)  Debt created hereunder;

(b)  Debt existing on the date hereof and set
forth in Schedule 6.01 and extensions, renewals and replacements of any
such Debt that do not increase the outstanding principal amount thereof;

(c)  Debt to the Company or any other Subsidiary;
and

(d)  other Debt; provided that the
Designated Amount does not at any time exceed 15% of Consolidated Net Tangible
Assets.

SECTION 6.02.  Liens, Etc.  Suffer to exist, create, assume or incur, or
permit any Material Subsidiary to suffer to exist, create, assume or incur, any
Security Interest, or assign, or permit any Material Subsidiary to assign, any
right to receive income, in each case to secure Debt or any other obligation or
liability, other than:

(a)  any Security Interest to secure Debt or any
other obligation or liability of any Material Subsidiary to the Company;

(b)  mechanics’, materialmen’s, carriers’ or other
like liens arising in the ordinary course of business (including construction
of facilities) in respect of obligations which are not due or which are being
contested in good faith and for which reasonable reserves have been
established;

(c)  any Security Interest arising by reason of
deposits with, or the giving of any form of security to, any governmental
agency or any body created or approved by law or governmental regulation which
is required by law or governmental regulation as a condition to the transaction
of any business, or the exercise of any privilege, franchise or license;

(d)  Security Interests for taxes, assessments or
governmental charges or levies not yet delinquent or Security Interests for
taxes, assessments or governmental charges or levies already delinquent but the
validity of which is being contested in good faith and for which reasonable
reserves have been established;

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(e)  Security Interests (including judgment liens)
arising in connection with legal proceedings so long as such proceedings are
being contested in good faith and, in the case of judgment liens, execution
thereon is stayed;

(f)  landlords’ liens on fixtures located on
premises leased by the Company or a Material Subsidiary in the ordinary course
of business;

(g)  Security Interests arising in connection with
contracts and subcontracts with or made at the request of the United States of
America, any state thereof, or any department, agency or instrumentality of the
United States of America or any state thereof for obligations not yet
delinquent;

(h)  any Security Interest arising by reason of
deposits to qualify the Company or a Material Subsidiary to conduct business,
to maintain self-insurance, or to obtain the benefit of, or comply with, laws;

(i)  any purchase money Security Interest claimed
by sellers of goods on ordinary trade terms provided that no financing
statement has been filed to perfect such Security Interest;

(j)  any Security Interest existing as of the date
hereof and set forth on Schedule 6.02, and the extension thereof to additions,
extensions, or improvements to the property subject to the Security Interest
which does not arise as a result of borrowing money or the securing of Debt or
other obligation or liability created, assumed or incurred after such date;

(k)  Security Interests on (i) property of a
corporation or firm existing at the time such corporation is merged or
consolidated with the Company or any Subsidiary or at the time of a sale, lease
or other disposition of the properties of a corporation or a firm as an
entirety (or the properties of a corporation or firm comprising a product line
or line of business, as an entirety) or substantially as an entirety to the
Company or a Subsidiary; or (ii) property comprising machinery, equipment
or real property acquired by the Company or any of its Material Subsidiaries,
which Security Interests shall have existed at the time of such acquisition and
secure obligations assumed by the Company or such Material Subsidiary in
connection with such acquisition; provided that the Debt or other
obligations or liabilities secured by Security Interests of the type described
in this paragraph (k) shall not either (i) have been created in
anticipation of such merger, consolidation, sale, lease or other disposition or
in contemplation of such acquisition or (ii) at any time exceed an
aggregate amount equal to $30,000,000;

(l)  Security Interests arising in connection with
the sale, assignment or other transfer by the Company or any Material
Subsidiary of accounts receivable, lease receivables or other payment
obligations (any of the foregoing being a “Receivable”) owing to the
Company or such Material Subsidiary or any interest in any of the foregoing
(together in each case with any collections and other proceeds thereof and any
collateral, guarantees or other property or claims in

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favor of the Company or such Material
Subsidiary supporting or securing payment by the obligor thereon of any such
Receivables), in each case whether such sale, assignment or other transfer
constitutes a “true sale” or a secured financing for accounting, tax or any
other purpose; provided that either (i) such sale, assignment or
other transfer shall have been made as part of a sale of the business out of
which the applicable Receivables arose, (ii) such sale, assignment or
other transfer is made in the ordinary course of business and is for the
purpose of collection only, (iii) such sale, assignment or other transfer
is made in connection with an agreement on the part of the assignee thereof to
render performance under the contract that has given rise to such Receivable, or
(iv) in the case of any other sale, assignment or transfer, the Designated
Amount does not at any time exceed 15% of Consolidated Total Assets;

(m)  Security Interests securing non-recourse
obligations in connection with leveraged or single-investor lease transactions;

(n)  Security Interests securing the performance
of any contract or undertaking made in the ordinary course of business (as such
business is currently conducted) other than for the payment of Debt;

(o)  any Security Interest granted by any Material
Subsidiary; provided, that (i) the principal business and assets of
such Material Subsidiary are located in Puerto Rico or are located outside of
the United States, its other territories and possessions, (ii) the
property of such Material Subsidiary which is subject to such Security Interest
is a parcel of real property, a manufacturing plant, manufacturing equipment, a
warehouse, or an office building hereafter acquired, constructed, developed or
improved by such Material Subsidiary, and (iii) such Security Interest is
created prior to or contemporaneously with, or within 120 days after
(x) in the case of acquisition of such property, the completion of such
acquisition and (y) in the case of the construction, development or
improvement of such property, the later to occur of the completion of such
construction, development or improvement or the commencement of operations, use
or commercial production (exclusive of test and start-up periods) of such
property, and such Security Interest secures or provides for the payment of all
or any part of the acquisition cost of such property or the cost of
construction, development or improvement thereof, as the case may be;

(p)  any Security Interest in deposits or cash
equivalent investments pledged with a financial institution for the sole
purpose of implementing a hedging or financing arrangement commonly known as a “back-to-back”
loan arrangement, provided in each case that neither the assets subject to such
Security Interest nor the Debt incurred in connection therewith are reflected
on the consolidated balance sheet of the Company; or

(q)  any extension, renewal or refunding (or
successive extensions, renewals or refundings) in whole or in part of any Debt
or any other obligation or liability secured by any Security Interest referred
to in the foregoing paragraphs

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(a) through (p), provided that the
principal amount of Debt or any other obligation or liability secured by such
Security Interest shall not exceed the principal amount outstanding immediately
prior to such extension, renewal or refunding, and that the Security Interest
securing such Debt or other obligation or liability shall be limited to the
property which, immediately prior to such extension, renewal or refunding
secured such Debt or other obligation or liability and additions to such
property; and provided further that the principal amount of Debt or any
other obligation or liability secured by such Security Interest shall continue
to be taken into account for purposes of computing the amount of Debt or any
other obligation or liability that may be secured under any applicable basket
provided for in the foregoing paragraphs (a) through (p).

Notwithstanding the foregoing provisions of this
Section, the Company and the Material Subsidiaries may, at any time, suffer to
exist, issue, incur, assume and guarantee Secured Debt (in addition to Secured
Debt permitted to be secured under the foregoing paragraphs (a) through (k) and
(m) through (q)); provided that the Designated Amount does not at any
time exceed 15% of Consolidated Net Tangible Assets.

SECTION 6.03.  Sale and
Leaseback Transactions.  Enter into
or be party to, or permit any Material Subsidiary to enter into or be party to,
any Sale and Leaseback Transaction unless after giving effect thereto the
Designated Amount does not exceed 15% of Consolidated Net Tangible Assets.

SECTION 6.04.  Merger, Etc.  (a) 
Permit the Company to merge or consolidate with or into, or Transfer
Assets to, any Person, except that the Company may (i) merge or consolidate
with any US Corporation, including any Subsidiary that is a US Corporation, and
(ii) Transfer Assets to any Subsidiary which is a US Corporation; provided,
in each case described in clause (i) and (ii) above, that
(A) immediately after giving effect to such transaction, no Default shall
have occurred and be continuing and (B) in the case of any merger or
consolidation to which the Company shall be a party, the survivor of such
merger or consolidation shall be the Company.

(b)  Permit any Material Subsidiary
to merge or consolidate with or into, or Transfer Assets to, any Person unless
(i) immediately after giving effect to such transaction, no Default shall have
occurred and be continuing and (ii) if either constituent corporation in such
merger or consolidation, or the transferor of such assets, is a Subsidiary
Guarantor, the surviving or resulting corporation or the transferee of such
assets, as the case may be, shall be a Subsidiary Guarantor.

(c)  Notwithstanding the
foregoing provisions of this Section 6.04 (other than the restrictions of
paragraph (a) above on the ability of the Company to Transfer Assets), the
Company may sell, transfer or otherwise dispose of all or substantially all of
the capital stock or other equity interests, or the assets of, any Material
Subsidiary (other than any Borrower, Edwards Lifesciences LLC, or Edwards
Lifesciences World Trade Corporation), and any such Material Subsidiary may
merge or consolidate with or into, or Transfer Assets to, any Person; provided,
that, in each case (i) both before and

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immediately
after giving effect to such transaction, no Default shall have occurred and be
continuing and (ii) such transaction shall be at fair value on an arm’s-length
basis.

SECTION 6.05.  Change in
Business.  Permit the Company or any
Material Subsidiary to engage to any material extent in any business other than
the medical devices, supplies and services businesses (but excluding the
management of institutional health care providers such as hospitals, nursing
homes, and long-term care facilities).

SECTION 6.06.  Certain
Restrictive Agreements.  Permit the
Company or any Material Subsidiary to enter into any contract or other
agreement that would limit the ability of any Material Subsidiary to pay
dividends or make loans or advances to, or to repay loans or advances from, the
Company or any other Subsidiary; provided that nothing in this section
shall prohibit (a) covenants or agreements entered into in connection with the
incurrence of secured Debt permitted hereunder that restrict the transfer of
collateral securing such Debt or (b) agreements entered into in connection with
sales of Receivables that govern the application of proceeds of sold
Receivables.

SECTION 6.07.  Leverage Ratio.  Permit the Leverage Ratio at any time to exceed
3.00:1.00.

SECTION 6.08.  Interest
Coverage Ratio.  Permit the Interest
Coverage Ratio for any period of four consecutive fiscal quarters ending during
any period set forth below to be less than 4.00:1.00.

ARTICLE VII

Events of Default

If any of the following events (“Events of Default”)
shall occur and be continuing:

(a)  Any Borrower shall fail to (i) pay any
interest or fee due hereunder and such default continues for five days, or
(ii) pay any amount of principal of any Loan or any reimbursement obligation
in respect of any LC Disbursement when due hereunder; or

(b)  Any representation or warranty made or deemed
made by the Company or any other Loan Party (or any of their respective
officers) in connection with this Agreement or any other Loan Document shall
prove to have been incorrect in any material respect when made or deemed made;
or

(c)  The Company or any Material Subsidiary shall
fail to maintain its corporate, limited liability company or partnership
existence as required by Section 5.03, or the Company or any Material
Subsidiary shall fail to perform or observe any term, covenant or agreement
contained in Article VI (other than

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Section 6.02 insofar as such failure
results from a nonconsensual Security Interest) of this Agreement on its part
to be performed or observed; or

(d)  The Company or any Subsidiary shall
(i) fail to perform or observe any other term, covenant or agreement
contained in this Agreement or any other Loan Document on its part to be
performed or observed (other than those failures or breaches referred to in
paragraphs (a), (b) and (c) above) and any such failure shall remain unremedied
for 30 days after written notice thereof has been given to the Company by
the Administrative Agent at the request of any Lender; or

(e)  Either (i) the Company or any Material
Subsidiary shall fail to pay any amount of principal of, interest on or premium
with respect to, any Debt (other than the Loans) of the Company or such
Subsidiary outstanding under one or more instruments or agreements when due
(whether at scheduled maturity or by required prepayment, acceleration, demand
or otherwise) and (A) such Debt shall be in an aggregate principal amount not
less than $10,000,000 and such failure shall continue beyond the greater of 15
days and the applicable grace period, if any, specified in the agreement or
instrument relating to such Debt or (B) such Debt shall be in an aggregate
principal amount not less than $20,000,000 and such failure shall continue
beyond the applicable grace period, if any, specified in the agreement or
instrument relating to such Debt; or (ii) any other event shall occur or
condition shall exist with respect to any Debt (other than the Loans) of the
Company or such Subsidiary outstanding under one or more instruments or agreements
if the effect of such event or condition is (or will after the lapse of any
grace period be) to cause, or to permit the holder or holders of such debt (or
any trustee or agent on their behalf) to cause, such Debt to become due, or to
require such Debt to be prepaid (other than by a scheduled prepayment), prior
to the stated maturity thereof and (A) such Debt shall be in an aggregate
principal amount not less than $10,000,000 and such failure shall continue
beyond the greater of 15 days and the applicable grace period, if any,
specified in the agreement or instrument relating to such Debt or (B) such Debt
shall be in an aggregate principal amount not less than $20,000,000 and such
failure shall continue beyond the applicable grace period, if any, specified in
the agreement or instrument relating to such Debt; or

(f)  The Company or any Material Subsidiary shall
generally not pay its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally; or

(g)  The Company or any Material Subsidiary shall
make a general assignment for the benefit of creditors; or any proceeding shall
be instituted by or against the Company or such Material Subsidiary seeking to
adjudicate it a bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or composition of
it or its debt under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order for
relief or the appointment of a receiver, trustee, or other similar official for
it or for any substantial part of its property; or the

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Company or any such Material Subsidiary shall
take corporate action to authorize any of the actions set forth above in this
paragraph (f); provided that, in the case of any such proceeding filed
or commenced against the Company or any Material Subsidiary, such event shall
not constitute an “Event of Default” hereunder unless either (i) the same
shall have remained undismissed or unstayed for a period of 60 days,
(ii) an order for relief shall have been entered against the Company or
such Material Subsidiary under the federal bankruptcy laws as now or hereafter
in effect or (iii) the Company or such Material Subsidiary shall have
taken corporate action consenting to, approving or acquiescing in the
commencement or maintenance of such proceeding; or

(h)  Any judgment or order for the payment of
money shall be rendered against the Company or any Material Subsidiary and
(i) either (A) enforcement proceedings shall have been commenced by
any creditor upon such judgment or order or (B) there shall be any period
of 10 consecutive days, in the case of a judgment or order rendered or
entered by a court located in the United States, its territories and Puerto
Rico, or 30 consecutive days, in the case of any other court, during which
a stay of enforcement of such judgment or order, by reason of a pending appeal
or otherwise, shall not be in effect, and (ii) the amount of such judgment
or order, when aggregated with the amount of all other such judgments and
orders described in this subsection (h), shall exceed $20,000,000;

(i)  Either (i) the Pension Benefit Guaranty
Corporation shall terminate any single-employer plan (as defined in Section
4001(b)(2) of ERISA) that provides benefits for employees of the Company or any
Material Subsidiary and such plan shall have an Unfunded Liability in an amount
in excess of $5,000,000 at such time or (ii) withdrawal liability shall be
assessed against the Company or any Material Subsidiary in connection with any
multiemployer plan (whether under Section 4203 or Section 4205 of
ERISA) and such withdrawal liability shall be an amount in excess of
$5,000,000; or

(j)  the guarantee of any Subsidiary Guarantor
that is a Material Subsidiary under the Subsidiary Guarantee Agreement or the
Company’s guarantee under Article X shall not be (or shall be asserted by the
Company or any Subsidiary Guarantor not to be) valid or in full force and
effect; or

(k)  a Change of Control shall have occurred.

then, in any such event but subject to the next
sentence, the Administrative Agent shall at the request, or may with the
consent, of the Required Lenders, by notice to the Company, (i) declare
the obligation of each Lender to make Loans hereunder to be terminated,
whereupon the same shall forthwith terminate and/or (ii) declare the
entire unpaid principal amount of the Loans, all interest accrued and unpaid
thereon and all other amounts payable under this Agreement to be forthwith due
and payable, whereupon the Loans, all such accrued interest and all such
amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby
expressly waived by the Borrowers; provided, that in the case of any 

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Competitive Bid Note, the unpaid principal amount
thereof, and all interest accrued and unpaid thereon, shall not be declared to
be due and payable pursuant to the foregoing clause (ii) without the consent of
the holder of such Competitive Bid Note. 
In the event of the occurrence of an Event of Default under clause (f)
or (g) of this Article VII, (A) the obligation of each Lender to make
Loans shall automatically be terminated and (B) the Loans, all such
interest and all such amounts shall automatically become and be due and
payable, without presentment, demand, protest or any notice of any kind, all of
which are hereby expressly waived by each Borrower.

ARTICLE VIII

The Agents

In order to expedite the transactions contemplated by
this Agreement, the Persons named in the heading of this Agreement are hereby
appointed to act as Administrative Agent, London Agent and Tokyo Agent on
behalf of the Lenders and the Issuing Bank. 
Each of the Lenders, each assignee of any Lender and the Issuing Bank
hereby irrevocably authorizes the Agents to take such actions on behalf of such
Lender or assignee or the Issuing Bank and to exercise such powers as are
delegated to the Agents by the terms of the Loan Documents, together with such
actions and powers as are reasonably incidental thereto.  The Administrative Agent and, to the extent
expressly provided herein, the other Agents are hereby expressly authorized by
the Lenders and the Issuing Bank, without hereby limiting any implied
authority, (a) to receive on behalf of the Lenders and the Issuing Bank
all payments of principal of and interest on the Loans and all other amounts
due to the Lenders hereunder, and promptly to distribute to each Lender or the
Issuing Bank its proper share of each payment so received; (b) to give
notice on behalf of each of the Lenders to the Company of any Event of Default
specified in this Agreement of which the Administrative Agent has actual
knowledge acquired in connection with its agency hereunder; and (c) to
distribute to each Lender copies of all notices, financial statements and other
materials delivered by the Company or any other Loan Party pursuant to this
Agreement or the other Loan Documents as received by the Administrative
Agent.  Without limiting the generality
of the foregoing, the Administrative Agent is hereby expressly authorized  to release any Subsidiary Guarantor from its
obligations under the Subsidiary Guarantee Agreement in the event that all the
capital stock of such Guarantor shall be sold, transferred or otherwise
disposed of to a Person other than the Company or an Affiliate of the Company
in a transaction permitted by Section 6.04.

With respect to the Loans made by it hereunder, each
Agent in its individual capacity and not as Agent shall have the same rights
and powers as any other Lender and may exercise the same as though it were not
an Agent, and the Agents and their Affiliates may accept deposits from, lend
money to and generally engage in any kind of business with the Company or any
Subsidiary or other Affiliate thereof as if it were not an Agent.

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The Agents shall not have any duties or obligations
except those expressly set forth in the Loan Documents.  Without limiting the generality of the
foregoing, (a) no Agent shall be subject to any fiduciary or other implied
duties, regardless of whether a Default has occurred and is continuing,
(b) no Agent shall have any duty to take any discretionary action or
exercise any discretionary powers, except discretionary rights and powers
expressly contemplated by the Loan Documents that such Agent is required to
exercise upon receipt of notice in writing by the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 11.02), and (c) except as expressly
set forth in the Loan Documents, no Agent shall have any duty to disclose, and no
Agent shall be liable for the failure to disclose, any information relating to
the Company or any of its Subsidiaries that is communicated to or obtained by
the institution serving as Agent or any of its Affiliates in any capacity.  No Agent shall be liable for any action taken
or not taken by it with the consent or at the request of the Required Lenders
(or such other number or percentage of the Lenders as shall be necessary under
the circumstances as provided in Section 11.02) or in the absence of its own
gross negligence or wilful misconduct. 
No Agent shall be deemed to have knowledge of any Default unless and
until written notice thereof is given to such Agent by a Borrower (in which
case such Agent shall give written notice to each other Lender), and no Agent
shall be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection
with any Loan Document, (ii) the contents of any certificate, report or
other document delivered hereunder or thereunder or in connection herewith or
therewith, (iii) the performance or observance of any of the covenants,
agreements or other terms or conditions set forth herein or therein,
(iv) the validity, enforceability, effectiveness or genuineness of any
Loan Document or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in Article IV or elsewhere in any
Loan Document, other than to confirm receipt of items expressly required to be
delivered to such Agent.

Each Agent shall be entitled to rely upon, and shall
not incur any liability for relying upon, any notice, request, certificate,
consent, statement, instrument, document or other writing believed by it to be
genuine and to have been signed or sent by the proper Person.  Each Agent also may rely upon any statement
made to it orally or by telephone and believed by it to be made by the proper
Person, and shall not incur any liability for relying thereon.  Each Agent may consult with legal counsel
(who may be counsel for any Borrower), independent accountants and other
experts selected by it, and shall not be liable for any action taken or not
taken by it in accordance with the advice of any such counsel, accountants or
experts.

Each Agent may perform any and all its duties and
exercise its rights and powers 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 its duties and exercise its rights
and powers through their respective Related Parties.  The exculpatory provisions of the preceding
paragraphs shall apply to any such sub-agent and to the Related Parties of each
Agent and any such sub-agent, and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as
well as activities as Agent.

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Subject to the appointment and acceptance of a
successor Agent as provided in this paragraph, any Agent may resign at any time
by notifying the Lenders, the Issuing Bank and the Company.  Upon any such resignation, the Required
Lenders shall have the right, in consultation with the Company, to appoint a
successor.  If no successor shall have
been so appointed by the Required Lenders and shall have accepted such appointment
within 30 days after the retiring Agent gives notice of its resignation,
then the retiring Agent may, on behalf of the Lenders and the Issuing Bank,
appoint a successor Agent which shall be a bank with an office in
New York, New York, or an Affiliate of any such bank.  Upon the acceptance of its appointment as
Agent hereunder by a successor, such successor shall succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
Agent, and the retiring Agent shall be discharged from its duties and obligations
hereunder.  After the Agent’s resignation
hereunder, the provisions of this Article and Section 11.03 shall continue
in effect for the benefit of such retiring Agent, its sub-agents and
their respective Related Parties in respect of any actions taken or omitted to
be taken by any of them while it was acting as Agent.

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

Each Lender hereby acknowledges that the Syndication
Agent and each Documentation Agent has no rights, duties or liability hereunder
other than in its capacity as a Lender.

ARTICLE IX

Collection
Allocation Mechanism

On the CAM Exchange Date, (a) the Commitments shall
automatically and without further act be terminated as provided in Article VII
and (b) the Lenders shall automatically and without further act be deemed to
have made reciprocal purchases of interests in the Specified Obligations such
that, in lieu of the interests of each Lender in the particular Specified
Obligations that it shall own as of such date and prior to the CAM Exchange,
such Lender shall own an interest equal to such Lender’s CAM Percentage in each
Specified Obligation.  Each Lender, each
person acquiring a participation from any Lender as contemplated by Section
11.04 and each Borrower hereby consents and agrees 

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to the CAM Exchange.  Each Borrower and each Lender agrees from
time to time to execute and deliver to the Agents all such promissory notes and
other instruments and documents as the Administrative Agent shall reasonably
request to evidence and confirm the respective interests and obligations of the
Lenders after giving effect to the CAM Exchange, and each Lender agrees to
surrender any promissory notes originally received by it hereunder to the
Administrative Agent against delivery of any promissory notes so executed and
delivered; provided that the failure of any Borrower to execute or
deliver or of any Lender to accept any such promissory note, instrument or
document shall not affect the validity or effectiveness of the CAM Exchange.

As a result of the CAM Exchange, on and after the CAM
Exchange Date, each payment received by an Agent pursuant to any Loan Document
in respect of any Specified Obligations shall be distributed to the Lenders pro
rata in accordance with their respective CAM Percentages (to be redetermined as
of each such date of payment or distribution to the extent required by the next
paragraph).

In the event that, on or after the CAM Exchange Date,
the aggregate amount of the Specified Obligations shall change as a result of
the making by the Issuing Bank of an LC Disbursement that is not reimbursed by
the applicable Borrower, then (a) each US Tranche Lender shall, in accordance
with Section 2.05(d), promptly purchase from the Issuing Bank a participation
in such LC Disbursement in the amount of such US Tranche Lender’s US Tranche
Percentage of such LC Disbursement (without giving effect to the CAM Exchange),
(b) the Administrative Agent shall redetermine the CAM Percentages after giving
effect to such LC Disbursement and the purchase of participations therein by
the US Tranche Lenders, and the Lenders shall automatically and without further
act be deemed to have made reciprocal purchases of interests in the Specified
Obligations such that each Lender shall own an interest equal to such Lender’s
CAM Percentage in each of the Specified Obligations and (c) in the event
distributions shall have been made in accordance with the preceding paragraph,
the Lenders shall make such payments to one another as shall be necessary in
order that the amounts received by them shall be equal to the amounts they
would have received had each LC Disbursement been outstanding on the CAM
Exchange Date.  Each such redetermination
shall be binding on each of the Lenders and their successors and assigns and
shall be conclusive, absent manifest error.

ARTICLE X

Guarantee

In order to induce the Lenders to extend credit to the
other Borrowers hereunder, the Company hereby irrevocably and unconditionally
guarantees, as a primary obligor and not merely as a surety, the payment when
and as due of the Obligations of such other Borrowers.  The Company further agrees that the due and
punctual payment of such Obligations may be extended or renewed, in whole or in
part, without notice to or 

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further assent from it,
and that it will remain bound upon its guarantee hereunder notwithstanding any
such extension or renewal of any such Obligation.

The Company waives presentment to, demand of payment from
and protest to any Borrower of any of the Obligations, and also waives notice
of acceptance of its obligations and notice of protest for nonpayment.  The obligations of the Company hereunder
shall not be affected by (a) the failure of any Agent or Lender to assert
any claim or demand or to enforce any right or remedy against any Loan Party
under the provisions of this Agreement, any other Loan Document or otherwise;
(b) any extension or renewal of any of the Obligations; (c) any
rescission, waiver, amendment or modification of, or release from, any of the
terms or provisions of this Agreement, or any other Loan Document or agreement;
(d) any default, failure or delay, wilful or otherwise, in the performance
of any of the Obligations; or (e) any other act, omission or delay to do
any other act which may or might in any manner or to any extent vary the risk
of the Company or otherwise operate as a discharge of a guarantor as a matter
of law or equity or which would impair or eliminate any right of the Company to
subrogation.

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

The obligations of the Company hereunder shall not be
subject to any reduction, limitation, impairment or termination for any reason,
and shall not be subject to any defense or set-off, counterclaim, recoupment or
termination whatsoever, by reason of the invalidity, illegality or
unenforceability of any of the Obligations, any impossibility in the
performance of any of the Obligations or otherwise.

The Company further agrees that its obligations
hereunder shall continue to be effective or be reinstated, as the case may be,
if at any time payment, or any part thereof, of any Obligation is rescinded or
must otherwise be restored by any Agent or Lender upon the bankruptcy or
reorganization of any Borrower or otherwise.

In furtherance of the foregoing and not in limitation
of any other right which any Agent or Lender may have at law or in equity
against the Company by virtue hereof, upon the failure of any other Borrower to
pay any Obligation when and as the same shall become due, whether at maturity,
by acceleration, after notice of prepayment or otherwise, the Company hereby
promises to and will, upon receipt of written demand by any Agent or Lender,
forthwith pay, or cause to be paid, to the applicable Agent or Lender in cash
an amount equal to the unpaid principal amount of such Obligations then
due, together with accrued and unpaid interest thereon.  The Company further agrees that if payment in
respect of any Obligation shall be due in a currency other than US Dollars
and/or at a place of payment other than New York and if, by reason of any
Change in Law, disruption of currency or foreign exchange markets, war or civil
disturbance or other event, payment of such Obligation in such currency or at
such place of payment 

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shall be impossible or,
in the reasonable judgment of any Agent or Lender, not consistent with the
protection of its rights or interests, then, at the election of the
Administrative Agent, the Company shall make payment of such Obligation in US
Dollars (based upon the applicable Exchange Rate in effect on the date of
payment) and/or in New York, and shall indemnify each Agent and Lender
against any losses or reasonable out-of-pocket expenses that it shall sustain
as a result of such alternative payment.

Upon payment by the Company of any sums as provided
above, all rights of the Company against any Borrower arising as a result
thereof by way of right of subrogation or otherwise shall in all respects be
subordinated and junior in right of payment to the prior indefeasible payment
in full of all the Obligations owed by such Borrower to the Agents and the
Lenders.

Nothing shall discharge or satisfy the liability of
the Company hereunder except the full performance and payment of the
Obligations.

ARTICLE XI

Miscellaneous

SECTION 11.01.  Notices.  Except in the case of notices and other
communications expressly permitted to be given by telephone, all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:

(a)  if to any Borrower, to One Edwards Way,
Irvine, California 92614, Attention of Daniel M. Gallagher (Telecopy No. (949)
250-2275);

(b)  if to the Administrative Agent, to JPMorgan
Chase Bank, N.A., Loan and Agency Services Group, 1111 Fannin, 10th Floor, Houston, TX 77002, Attention of
Jennifer Anyigbo (Telecopy No. (713) 750-2782), with a copy to
JPMorgan Chase Bank, N.A., 270 Park Avenue, New York, NY 10017, Attention of
Parkinson Small (Telecopy No. (212) 270-6637);

(c)  if to the London Agent, to it at J.P. Morgan
Europe Limited, 125 London Wall, London, England EC2Y 5AJ, Attention of
Susan Dalton (Telecopy No. 011-44-207-777-2542); with a copy to the
Administrative Agent as provided in paragraph (b) above;

(d)  if to the Tokyo Agent, to it at Mizuho
Corporate Bank, Ltd., Syndicated Finance Administration Division, 1-3-3,
Marunouchi, Chiyoda-ku, Tokyo, Japan, Attention of Mieko Morii, (Telecopy No.
011-81-3-3201-0704); with a copy to the Administrative Agent as provided in
paragraph (b) above

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(e)  if to the Issuing Bank, to it at JPMorgan
Chase Bank, N.A., 1111 Fannin, 10th Floor, Houston, TX 77002, Attention of
Jennifer Anyigbo (Telecopy No. (713) 750-2782); and

(f)  if to any Lender, to it at its address (or
telecopy number) set forth in its Administrative Questionnaire.

Any party hereto may change its address or telecopy
number for notices and other communications hereunder by notice to the other
parties hereto.  All notices and other
communications given to any party hereto in accordance with the provisions of
this Agreement shall be deemed to have been given on the date of receipt.

SECTION 11.02.  Waivers;
Amendments.  (a)  No failure or delay by any Agent, the Issuing
Bank or any Lender in exercising any right or power hereunder or under any
other Loan Document shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power.  The rights and remedies of the Agents, the
Issuing Bank and the Lenders hereunder and under the other Loan Documents are
cumulative and are not exclusive of any rights or remedies that they would
otherwise have.  No waiver of any
provision of any Loan Document or consent to any departure by any Loan Party
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which
given.  Without limiting the generality
of the foregoing, the making of a Loan or issuance of a Letter of Credit shall
not be construed as a waiver of any Default, regardless of whether any Agent,
any Lender or the Issuing Bank may have had notice or knowledge of such Default
at the time.

(b)  Neither this Agreement nor
any other Loan Document nor any provision hereof or thereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Company and the Required Lenders or by the Company and the
Administrative Agent with the consent of the Required Lenders or, in the case
of any other Loan Document, pursuant to an agreement or agreements in writing
entered into by the Administrative Agent and the Loan Party or Loan Parties
that are parties thereto, in each case with the consent of the Required
Lenders; provided that no such agreement shall (i) increase any
Commitment of any Lender without the written consent of such Lender, (ii)
reduce the principal amount of any Loan or LC Disbursement or reduce the rate
of interest thereon, or reduce any fees payable hereunder, without the written
consent of each Lender adversely affected thereby, (iii) postpone the date of
any scheduled payment of the principal amount of any Loan or LC Disbursement,
or any interest thereon, or any fees payable hereunder, or reduce the amount
of, waive or excuse any such payment, or postpone the scheduled date of
expiration of any Commitment, without the written consent of each Lender
affected thereby, (iv) change Section 2.18(b) or (c) in a manner that
would alter the pro rata sharing of payments required thereby without the written
consent of each Lender (it being understood that the addition of new tranches
of loans or commitments that may be 

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extended under this
Agreement shall not be deemed to alter such pro rata sharing of payments),
(v) change any of the provisions of this Section or the definition of “Required
Lenders” or any other provision of any Loan Document specifying the number or
percentage of Lenders (or Lenders of any Class) required to waive, amend or
modify any rights thereunder or make any determination or grant any consent
thereunder, without the written consent of each Lender (or each Lender of such
Class, as the case may be) (except, in each case, to provide for new tranches
of loans or commitments that may be extended under this Agreement),
(vi) release the Company or all or substantially all the Subsidiary
Guarantors from, or limit or condition, its or their obligations under
Article X or the Subsidiary Guarantee Agreement, without the written
consent of each Lender, (vii) change any provisions of Article IX without the
written consent of each Lender, or (viii) change any provisions of any Loan
Document in a manner that by its terms adversely affects the rights in respect
of payments due to Lenders holding Loans of any Class differently than those of
Lenders holding Loans of any other Class without the written consent of Lenders
holding a majority in interest of the outstanding Loans and unused Commitments
of each adversely affected Class; provided further that (A) no such
agreement shall amend, modify or otherwise affect the rights or duties of any
Agent or the Issuing Bank hereunder or under any other Loan Document without
the prior written consent of such Agent or the Issuing Bank, as the case may
be, and (B) any waiver, amendment or modification of this Agreement that by its
terms affects the rights or duties under this Agreement of the US Tranche
Lenders (but not the Swiss Tranche Lenders or the Japanese
Tranche Lenders), the Swiss Tranche Lenders (but not the Japanese Tranche
Lenders or the US Tranche Lenders), or the Japanese Tranche Lenders (but not
the US Tranche Lenders or the Swiss Tranche Lenders) may be effected by an
agreement or agreements in writing entered into by the Company and requisite
percentage in interest of the affected Class of Lenders.

SECTION 11.03.  Expenses;
Indemnity; Damage Waiver.  (a)  The Company shall pay (i) all reasonable out-of-pocket
expenses incurred by the Agents and their Affiliates, including the reasonable
fees, charges and disbursements of counsel for the Agents, in connection with
the syndication of the credit facilities provided for herein, the preparation
and administration of this Agreement or the other Loan Documents or any
amendments, modifications or waivers of the provisions hereof or thereof
(whether or not the transactions contemplated hereby or thereby shall be
consummated, (ii) all reasonable out-of-pocket expenses incurred by the
Issuing Bank in connection with the issuance, amendment, renewal or extension
of any Letter of Credit or any demand for payment thereunder and (iii) all
reasonable out-of-pocket expenses incurred by any Agent, the Issuing Bank or
any Lender, including the reasonable fees, charges and disbursements of any
counsel, for any Agent, the Issuing Bank or any Lender, in connection with the
enforcement or protection of its rights in connection with any Loan Document,
including its rights under this Section, or in connection with the Loans made
or Letters of Credit issued hereunder, including all such out-of-pocket
expenses incurred during any workout, restructuring or negotiations in respect
of such Loans or Letters of Credit.

(b)  The Company shall indemnify
each Agent, the Issuing Bank and each Lender, and each Related Party of any of
the foregoing Persons (each such Person being called an “Indemnitee”)
against, and hold each Indemnitee harmless from, any and all 

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losses,
liabilities, reasonable out-of-pocket costs or expenses, including the
reasonable fees, charges and disbursements of any counsel for any Indemnitee,
incurred by or asserted against any Indemnitee arising out of, in connection
with, or as a result of (i) any transaction or proposed transaction
(whether or not consummated) in which any proceeds of any borrowing hereunder
are applied or proposed to be applied, directly or indirectly, by the Company
or any Subsidiary, (ii) any Loan or Letter of Credit or the use of the proceeds
therefrom (including any refusal by the Issuing Bank to honor a demand for
payment under a Letter of Credit if the documents presented in connection with
such demand do not strictly comply with the terms of such Letter of Credit, or
(iii) the execution, delivery or performance by the Company and the
Subsidiaries of the Loan Documents, or any actions or omissions of the Company
or any Subsidiary in connection therewith; provided that such indemnity
shall not, as to any Indemnitee, be available to the extent that such losses,
liabilities, costs or expenses shall have resulted from the gross negligence or
wilful misconduct of such Indemnitee or the violation by such Indemnitee of any
law or court order applicable to it.

(c)  To the extent that the
Company fails to pay any amount required to be paid by it to any Agent or the
Issuing Bank under paragraph (a) or (b) of this Section, each Lender severally
agrees to pay to such Agent or the Issuing Bank, as the case may be, such
Lender’s pro rata share (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided
that the unreimbursed loss, liability, cost or expense, as the case may be, was
incurred by or asserted against such Agent or the Issuing Bank in its capacity
as such.  For purposes hereof, a Lender’s
“pro rata share” shall be determined based upon its share of the sum (without
duplication) of the total Exposures and unused Commitments at the time.

(d)  To the extent permitted by
applicable law, no Borrower shall assert, and each Borrower hereby waives, any
claim against any Indemnitee, on any theory of liability, for special,
indirect, consequential or punitive damages (as opposed to direct or actual
damages) arising out of, in connection with, or as a result of, this Agreement,
any other Loan Agreement or any agreement or instrument contemplated hereby,
the Transactions, any Loan or Letter of Credit or the use of the proceeds
thereof.

(e)  All amounts due under this
Section shall be payable within 15 Business Days after receipt by the Company
of a reasonably detailed invoice therefor.

SECTION 11.04.  Successors and
Assigns.  (a)  The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto, each other
Indemnitee and their respective successors and assigns permitted hereby
(including any Affiliate of the Issuing Bank that issues any Letter of Credit),
except that no Borrower may assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of each Lender (and any
attempted assignment or transfer by any Borrower without such consent shall be
null and void).  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 (including
any Affiliate of the Issuing Bank that issues any Letter of Credit), the
Related Parties of each of the Agents, the Issuing Bank and the

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Lenders) any legal or
equitable right, remedy or claim under or by reason of this Agreement.

(b)  Any Lender may assign to one
or more assignees all or a portion of its rights and obligations under this
Agreement (including all or a portion of its Commitments and the Loans or other
amounts at the time owing to it); provided that (i)  the
Administrative Agent and, except in the case of an assignment to a Lender, an
Affiliate of a Lender or a Related Fund of any Lender, the Company (and in the
case of an assignment of all or a portion of a US Tranche Commitment or any
Lender’s obligations in respect of its LC Exposure, the Issuing Bank) must give
their prior written consent to such assignment (which consent shall not be
unreasonably withheld), (ii) except in the case of an assignment to a Lender,
an Affiliate of a Lender or a Related Fund of any Lender or an assignment of
the entire remaining amount of the assigning Lender’s Commitments and
outstanding Loans, the amount of the Commitments and outstanding Loans of the
assigning Lender subject to each such assignment (determined as of the date the
Assignment and Acceptance with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $10,000,000 unless each of the
Company and the Administrative Agent otherwise consent, (iii) the parties to
each assignment shall execute and deliver to the Administrative Agent an Assignment
and Acceptance, together with a processing and recordation fee of $3,500
(provided, that if such assignment is an assignment of commitments or Loans
under the Japanese Tranche, the processing and recordation fee shall be paid to
the Tokyo Agent), and (iv) the assignee, if it shall not be a Lender,
shall deliver to the Administrative Agent an Administrative Questionnaire, and
(v) with respect to any assignment of Swiss Tranche Commitments or Swiss
Tranche Revolving Loans, the parties to the assignment shall advise the Company
as to whether the assignee is a Qualifying Bank, and if the assignee is not a
Qualifying Bank and after giving effect to such assignment there would be more
than ten Swiss Tranche Lenders that were not Qualifying Banks, the assignment
shall not be permitted; and provided further that any consent of the
Company otherwise required under this paragraph shall not be required if an
Event of Default referred to in clause (f) or (g) of Article VII has occurred
and is continuing.  Subject to acceptance
and recording thereof pursuant to paragraph (d) of this Section, from and
after the effective date specified in each Assignment and Acceptance the
assignee thereunder shall be a party hereto and, to the extent of the interest
assigned by such Assignment and Acceptance, have the rights and obligations of
a Lender under this Agreement, and the assigning Lender thereunder shall, to
the extent of the interest assigned by such Assignment and Acceptance, be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all of the assigning Lender’s rights and
obligations under this Agreement, such Lender shall cease to be a party hereto
but shall continue to be entitled to the benefits of Sections 2.15, 2.16,
2.17 and 11.03).  Any assignment or
transfer by a Lender of rights or obligations under this Agreement that does
not comply with this paragraph shall be treated for purposes of this Agreement
as a sale by such Lender of a participation in such rights and obligations in
accordance with paragraph (e) of this Section.

(c)  The Administrative Agent,
acting for this purpose as an agent of each Borrower, shall maintain at one of
its offices in The City of New York a copy of each 

 72
 

 

Assignment and Acceptance
delivered to it and a register for the recordation of the names and addresses
of the Lenders, and the Commitment of, and principal amount of the Loans and LC
Disbursements owing to, each Lender pursuant to the terms hereof from time to
time (the “Register”).  The
entries in the Register shall be conclusive, and the Borrowers, the
Administrative Agent, the Issuing Bank and the Lenders may treat each Person
whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary.  The Register shall be
available for inspection by the Company, the Issuing Bank and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.

(d)  Upon its receipt of a duly
completed Assignment and Acceptance executed by an assigning Lender and an
assignee, the assignee’s completed Administrative Questionnaire (unless the
assignee shall already be a Lender hereunder), the processing and recordation
fee referred to in paragraph (b) of this Section and any written consent
to such assignment required by paragraph (b) of this Section, the
Administrative Agent shall accept such Assignment and Acceptance and record the
information contained therein in the Register. 
No assignment shall be effective for purposes of this Agreement unless
it has been recorded in the Register as provided in this paragraph.

(e)  Any Lender may, without the
consent of any Borrower or the Administrative Agent or the Issuing Bank, sell
participations to one or more banks or other entities (a “Participant”)
in all or a portion of such Lender’s rights and obligations under this
Agreement (including all or a portion of its Commitment and the Loans owing to
it); provided that (i) such Lender’s obligations under this
Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (iii) the Borrowers, the Administrative Agent, the Issuing Bank and
the other Lenders shall continue to deal solely and directly with such Lender
in connection with such Lender’s rights and obligations under this
Agreement.  Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not,
without the consent of the Participant, agree to any amendment, modification or
waiver described in clause (i), (ii), (iii) or (vi) of the first proviso to
Section 11.02(b) that affects such Participant.  Subject to paragraph (f) of this Section,
each Borrower agrees that each Participant shall be entitled to the benefits of
Sections 2.15, 2.16 and 2.17 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to
paragraph (b) of this Section.

(f)  A Participant shall not be
entitled to receive any greater payment under Section 2.15 or 2.17 than
the applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to
such Participant is made with the Company’s prior written consent.  A Participant shall not be entitled to the
benefits of Section 2.17 unless the Company is notified of the
participation sold to such Participant and such Participant agrees, for the
benefit of the Borrowers, to comply with Section 2.17(e) as though it were
a Lender.

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(g)  Any Lender may at any time
pledge or assign a security interest in all or any portion of its rights under
this Agreement to secure obligations of such Lender, including any pledge or
assignment to secure obligations to a Federal Reserve Bank or, in the case of a
Lender that is an investment fund, to the trustee under the indenture to which
such fund is a party, and this Section shall not apply to any such pledge or
assignment of a security interest; provided that no such pledge or
assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such
Lender as a party hereto.

SECTION 11.05.  Survival.  All covenants, agreements, representations
and warranties made by the Loan Parties herein or in any other Loan Document or
in the certificates or other instruments delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the other parties hereto or thereto and shall survive
the execution and delivery of this Agreement and any other Loan Document and
the making of any Loans and issuance of any Letters of Credit, regardless of
any investigation made by any such other party or on its behalf and
notwithstanding that any Agent, the Issuing Bank or any Lender may have had
notice or knowledge of any Default or incorrect representation or warranty at
the time any credit is extended hereunder, and shall continue in full force and
effect as long as the principal of or any accrued interest on any Loan or any
fee or any other amount payable under this Agreement or any other Loan Document
is outstanding and unpaid or any Letter of Credit is outstanding and so long as
the Commitments have not expired or terminated. 
The provisions of Sections 2.15, 2.16, 2.17, 11.03 and 11.12 (but,
in the case of Section 11.12, only for a period of two years following
termination of this Agreement) and Article VIII shall survive and remain
in full force and effect regardless of the consummation of the transactions
contemplated hereby, the repayment of the Loans, the expiration or termination
of the Letters of Credit and the Commitments or the termination of this
Agreement or any other Loan Document or any provision hereof or thereof.

SECTION 11.06.  Counterparts;
Integration; Effectiveness.  This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract.  This Agreement, the other Loan Documents and
any separate letter agreements with respect to fees payable to the
Administrative Agent constitute the entire contract among the parties relating
to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof.  Except as provided in Section 4.01, this
Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received
counterparts hereof which, when taken together, bear the signatures of each of
the other parties hereto, and thereafter shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns.  Delivery of an executed counterpart of a
signature page of this Agreement by telecopy shall be effective as delivery of
a manually executed counterpart of this Agreement.

SECTION 11.07.  Severability.  Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be 

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ineffective to
the extent of such invalidity, illegality or unenforceability without affecting
the validity, legality and enforceability of the remaining provisions hereof;
and the invalidity of a particular provision in a particular jurisdiction shall
not invalidate such provision in any other jurisdiction.

SECTION 11.08.  Right of
Setoff.  If an Event of Default shall
have occurred and be continuing, each Lender and each of its Affiliates is
hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final and in whatever currency denominated)
at any time held and other obligations at any time owing by such Lender or
Affiliate to or for the credit or the account of any Borrower against any of
and all the obligations of such Borrower now or hereafter existing under this
Agreement held by such Lender, irrespective of whether or not such Lender shall
have made any demand under this Agreement and although such obligations may be
unmatured.  The rights of each Lender
under this Section are in addition to other rights and remedies (including
other rights of setoff) which such Lender may have.

SECTION 11.09.  Governing Law;
Jurisdiction; Consent to Service of Process.  (a) 
This Agreement shall be construed in accordance with and governed by the
law of the State of New York.

(b)  Each Borrower hereby
irrevocably and unconditionally submits, for itself and its property, to the
nonexclusive jurisdiction of the Supreme Court of the State of New York
sitting in New York County and of the United States District Court of
the Southern District of New York, and any appellate court from any
thereof, in any action or proceeding arising out of or relating to any Loan
Document, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in such
New York State or, to the extent permitted by law, in such Federal
court.  Each of the parties hereto agrees
that a final judgment in any such action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law.  Nothing in this
Agreement or any other Loan Document shall affect any right that the Administrative
Agent, the Issuing Bank or any Lender may otherwise have to bring any action or
proceeding relating to this Agreement against any Borrower or its properties in
the courts of any jurisdiction.

(c)  Each Borrower hereby
irrevocably and unconditionally waives, to the fullest extent it may legally
and effectively do so, any objection which it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of or relating to
this Agreement or any other Loan Document in any court referred to in paragraph
(b) of this Section.  Each of the parties
hereto hereby irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.

(d)  Each party to this Agreement
irrevocably consents to service of process in the manner provided for notices
in Section 11.01.  Nothing in this
Agreement 

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or any other
Loan Document will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.

SECTION 11.10.  WAIVER OF JURY
TRIAL.  EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY
HAVE TO A TRIAL BY JURY IN  ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT,
ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED
ON CONTRACT, TORT OR ANY OTHER THEORY). 
EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO
HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

SECTION 11.11.  Headings.  Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of
this Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.

SECTION 11.12.  Confidentiality.  (a) 
Each Agent, the Issuing Bank and each Lender agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its and its Affiliates’ directors, officers,
employees and agents, including accountants, legal counsel and other advisors,
to Related Funds’ directors and officers and to any direct or indirect
contractual counterparty in swap agreements (it being understood that each
Person to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority,
(c) to the extent required by applicable laws or regulations or by any
subpoena or similar legal process, (d) to any other party to this Agreement,
(e) to the extent required or advisable in the judgment of counsel in
connection with any suit, action or proceeding relating to the enforcement of
rights of the Agents or the Lenders against the Borrowers under this Agreement
or any other Loan Document, (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement or (ii) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating
to the Company and its obligations, (g) with the consent of the Company or
(h) to the extent such Information (i) becomes publicly available
other than as a result of a breach of this Section of which such Agent or
Lender is aware or (ii) becomes available to the Administrative Agent, the
Issuing Bank or any Lender on a nonconfidential basis from a source other than
the Company other than as a result of a breach of this Section of which such
Agent or Lender is aware.  For the
purposes of this Section, “Information” means all information received
from the Company relating to the Company or its business, other than any such 

 76
 

 

information
that is available to the Administrative Agent, the Issuing Bank or any Lender
on a nonconfidential basis prior to disclosure by the Company other than as a
result of a breach of this Section of which such Agent or Lender is aware.  Any Person required to maintain the
confidentiality of Information as provided in this Section shall be considered
to have complied with its obligation to do so if such Person has exercised the
same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.

(b)  Each Lender acknowledges
that Information furnished to it pursuant to this Agreement may include
material non-public information concerning the Company and its Related Parties
or its or their securities, and confirms that it has developed compliance
procedures regarding the use of material non-public information and that it
will handle such material non-public information in accordance with the
procedures and applicable law, including Federal and State securities laws.

(c)  All Information, including
requests for waivers and amendments, furnished by the Company or the Agents
pursuant to, or in the course of administering, this Agreement will be
syndicate-level information, which may contain material non-public information
about the Company and the Subsidiaries and its and their Related Parties or
securities.  Accordingly, each Lender
represents to the Company and each Agent that it has identified in its
Administrative Questionnaire a credit contact who may receive information that
may contain material non-public information in accordance with its compliance
procedures and applicable law, including Federal and State securities laws.

SECTION 11.13.  Conversion of
Currencies.  (a)  If, for the purpose of obtaining judgment in
any court, it is necessary to convert a sum owing hereunder in one currency
into another currency, each party hereto agrees, to the fullest extent that it
may effectively do so, that the rate of exchange used shall be that at which in
accordance with normal banking procedures in the relevant jurisdiction the
first currency could be purchased with such other currency on the Business Day
immediately preceding the day on which final judgment is given.

(b)  The obligations of each
Borrower in respect of any sum due to any party hereto or any holder of the
obligations owing hereunder (the “Applicable Creditor”) shall,
notwithstanding any judgment in a currency (the “Judgment Currency”)
other than the currency in which such sum is stated to be due hereunder (the “Agreement
Currency”), be discharged only to the extent that, on the Business Day
following receipt by the Applicable Creditor of any sum adjudged to be so due
in the Judgment Currency, the Applicable Creditor may in accordance with normal
banking procedures in the relevant jurisdiction purchase the Agreement Currency
with the Judgment Currency; if the amount of the Agreement Currency so
purchased is less than the sum originally due to the Applicable Creditor in the
Agreement Currency, such Borrower agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify the Applicable Creditor against
such loss.  The obligations of the Borrowers
contained in this Section 11.13 shall survive the termination of this
Agreement and the payment of all other amounts owing hereunder.

 77
 

 

SECTION 11.14.  Termination of
Covenants.  Notwithstanding any other
provision in this Agreement, at any time when the Commitments shall have
terminated and no Loans shall be outstanding but Letters of Credit are still
outstanding, if the Borrowers shall post cash collateral in an amount equal to
the LC Exposure, the Borrowers shall no longer be required to comply with the
covenants set forth in Article V or Article VI of this Agreement.

SECTION 11.15.  Release of
Guarantors.  A Subsidiary Guarantor
shall be released from each of the Guarantee Agreement and the Indemnity,
Subrogation and Contribution Agreement with respect to such Subsidiary
Guarantor if (i) all of the capital stock of such Subsidiary Guarantor
owned by the Company or any Subsidiary shall be sold in a transaction permitted
under the terms of this Agreement and (ii) at the time of such sale no
Default has occurred and is continuing. 
The Administrative Agent shall promptly (and the Lenders hereby
authorize and instruct the Administrative Agent to) take such action and
execute any such documents as may be reasonably requested by the Borrower and
to provide written evidence of the release of any Subsidiary Guarantor pursuant
to this Section.

SECTION 11.16.  USA PATRIOT
Act.  Each Lender hereby notifies the Borrower that pursuant to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Act”), it is required to obtain, verify and
record information that identifies the Borrower, which information includes the
name and address of the Borrower and other information that will allow such
Lender to identify the Borrower in accordance with the Act.

SECTION 11.17.  Qualifying
Bank Representation and Warranty. 
Each Swiss Tranche Lender on the date of this Agreement hereby
represents and warrants to the Swiss Borrower that such Lender is a Qualifying
Bank.  If, at any time prior to the
expiration or termination of the Swiss Tranche Commitments and the repayment in
full of the principal of and interest on each Swiss Tranche Revolving Loan, any
Swiss Tranche Lender that shall have been a Qualifying Bank at the time it became
a party hereto shall cease to be a Qualifying Bank, and at such time there are
more than ten Swiss Tranche Lenders (including such Swiss Tranche Lender) that
are not Qualifying Banks, then such Swiss Tranche Lender shall promptly
transfer any Swiss Tranche Commitment and any Swiss Tranche Revolving Loan to a
Qualifying Bank in accordance with Section 11.04(b).

SECTION 11.18.  No Fiduciary
Duty.  Each Borrower, on behalf of
itself and the Subsidiaries, agrees that in connection with all aspects of the
transactions contemplated hereby and any communications in connection
therewith, the Borrowers, the Subsidiaries and their Affiliates, on the one
hand, and the Agents, the Issuing Bank, the Lenders and their Affiliates, on
the other hand, will have a business relationship that does not create, by
implication or otherwise, any fiduciary duty on the part of the Agents, the
Issuing Bank, the Lenders or their Affiliates, and no such duty will be deemed
to have arisen in connection with any such transactions or communications.

 78
 

 

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

	
   

  	
  EDWARDS LIFESCIENCES

  CORPORATION,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Thomas M.
  Abate

  
	
   

  	
   

  	
   

  	
  Name: Thomas M. Abate

  
	
   

  	
   

  	
   

  	
  Title:   Corporate
  Vice President, 

  
	
   

  	
   

  	
   

  	
  Chief Financial Officer and

  Treasurer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EDWARDS LIFESCIENCES WORLD

  TRADE CORPORATION,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Thomas M.
  Abate

  
	
   

  	
   

  	
   

  	
  Name: Thomas M. Abate

  
	
   

  	
   

  	
   

  	
  Title:   Corporate
  Vice President,

  
	
   

  	
   

  	
   

  	
  Chief Financial Officer and

  Treasurer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EDWARDS LIFESCIENCES LLC,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Thomas M.
  Abate

  
	
   

  	
   

  	
   

  	
  Name: Thomas M. Abate

  
	
   

  	
   

  	
   

  	
  Title:   Corporate
  Vice President, 

  
	
   

  	
   

  	
   

  	
  Chief Financial Officer and

  Treasurer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EDWARDS LIFESCIENCES (U.S.) INC.,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Thomas M.
  Abate

  
	
   

  	
   

  	
   

  	
  Name: Thomas M. Abate

  
	
   

  	
   

  	
   

  	
  Title:   Corporate
  Vice President, 

  
	
   

  	
   

  	
   

  	
  Chief Financial Officer and

  Treasurer

  

 

 79
 

 

 

	
  

  	
  EDWARDS LIFESCIENCES AG,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Michael
  Ferguson

  
	
   

  	
   

  	
   

  	
  Name: Michael Ferguson

  
	
   

  	
   

  	
   

  	
  Title:   Director

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EDWARDS LIFESCIENCES (JAPAN)

  LIMITED,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Huimin Wang,
  M.D.

  
	
   

  	
   

  	
   

  	
  Name: Huimin Wang, M.D.

  
	
   

  	
   

  	
   

  	
  Title: Representative Director

  

 

 80
 

 

 

	
  

  	
  JPMORGAN CHASE BANK, N.A.,

  individually and as Administrative Agent

  and Issuing Bank,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Dawn Lee Lum

  
	
   

  	
   

  	
   

  	
  Name: Dawn Lee Lum

  
	
   

  	
   

  	
   

  	
  Title:   Vice President

  

 

 81
 

 

 

	
  

  	
  BANK OF AMERICA, N.A.,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Kevin Wagley

  
	
   

  	
   

  	
   

  	
  Name: Kevin Wagley

  
	
   

  	
   

  	
   

  	
  Title:   Senior Vice President

  

 

 82

 

 

	
  

  	
  THE BANK OF TOKYO-MITSUBISHI

  
	
   

  	
  UFJ, LTD. (CHICAGO BRANCH)

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
  /s/ Tsuguyuki
  Umene

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Tsuguyuki Umene

  
	
   

  	
   

  	
  Title:

  	
  Deputy General Manager

  
						

 

 83
 

 

 

	
  

  	
  MIZUHO CORPORATE BANK, LTD.

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
  /s/ Raymond
  Ventura

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Raymond Ventura

  
	
   

  	
   

  	
  Title:

  	
  Deputy General Manager

  
						

 

 84
 

 

 

	
  

  	
  MIZUHO CORPORATE BANK, LTD.

  
	
   

  	
  as Tokyo Agent

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
  /s/ Jun Okazaki

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Jun Okazaki

  
	
   

  	
   

  	
  Title:

  	
  General Manager,

  
	
   

  	
   

  	
   

  	
  Syndicated Finance

  
	
   

  	
   

  	
   

  	
  Coordination Division

  
						

 

 85
 

 

 

	
  

  	
  SUNTRUST BANK

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
  /s/ Gregory M.
  Ratlifff

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Gregory M. Ratliff

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  
						

 

 86
 

 

 

	
  

  	
  WACHOVIA BANK, NATIONAL

  
	
   

  	
  ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
  /s/ James S.
  Conville

  	
   

  
	
   

  	
   

  	
  Name:

  	
  James S. Conville

  
	
   

  	
   

  	
  Title:

  	
  Assistant Vice President

  
						

 

 87
 

 

 

	
  

  	
  BANCO BILBAO VIZCAYA

  
	
   

  	
  ARGENTARIA, S.A.

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
  /s/ Hector O.
  Villegas

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Hector O. Villegas

  
	
   

  	
   

  	
  Title:

  	
  Vice President,

  
	
   

  	
   

  	
   

  	
  Global Corporate Banking

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
  /s/ Maria T.
  Vizan

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Maria T. Vizan

  
	
   

  	
   

  	
  Title:

  	
  Vice President,

  
	
   

  	
   

  	
   

  	
  Global Corporate Banking

  
						

 

 88
 

 

 

	
  

  	
  MORGAN STANLEY BANK 

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
  /s/ Daniel
  Twenge

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Daniel Twenge

  
	
   

  	
   

  	
  Title:

  	
  Authorized Signatory

  
						

 

 89
 

 

 

	
  

  	
  THE BANK OF NOVA SCOTIA

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
  /s/ Nadine Bell

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Nadine Bell

  
	
   

  	
   

  	
  Title:

  	
  Senior Manager Loan

  
	
   

  	
   

  	
   

  	
  Operations

  
						

 

 90
 

 

 

	
  

  	
  WELLS FARGO BANK, N.A.

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
  /s/ Paul K.
  Stimpfl

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Paul K. Stimpfl

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  
						

 

 91
 

 

 

	
  

  	
  UNION BANK OF CALIFORNIA, N.A.

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
  /s/ Stephen W.
  Dunne

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Stephen W. Dunne

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  
						

 

 92

 

EXHIBIT A-1

[FORM OF]

BORROWING SUBSIDIARY
AGREEMENT dated as of
[          ], among EDWARDS
LIFESCIENCES CORPORATION, a Delaware corporation (the “Company”), [Name of
Borrowing Subsidiary], a
[          ] corporation (the
“New Borrowing Subsidiary”), and JPMorgan Chase Bank, N.A., as Administrative
Agent (the “Administrative Agent”).

Reference is hereby made
to the Amended and Restated Five Year Credit Agreement dated as of
September 29, 2006 (as amended, supplemented or otherwise modified from
time to time, the “Five Year Credit Agreement”), among the Company, the US
Borrowers, the Swiss Borrowers, the Japanese Borrowers, the Lenders from time
to time party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent and
Issuing Bank, J.P. Morgan Europe Limited, as London Agent, Mizuho Corporate
Bank, Ltd., as Tokyo Agent, Bank of America, N.A., as Syndication Agent and The
Bank of Tokyo – Mitsubishi UFJ, Ltd., Mizuho Corporate Bank, Ltd., Suntrust
Bank and Wachovia Bank, N.A., each as Documentation Agent.  Capitalized terms used herein but not
otherwise defined herein shall have the meanings assigned to such terms in the
Five Year Credit Agreement.  Under the
Five Year Credit Agreement, the Lenders have agreed, upon the terms and subject
to the conditions therein set forth, to make Loans to the US Borrowers, the
Swiss Borrowers and the Japanese Borrowers (collectively with the Company, the “Borrowers”),
and the Company and the New Borrowing Subsidiary desire that the New Borrowing
Subsidiary become a [US] [Swiss] [Japanese] Borrower.  The Company represents that the New Borrowing
Subsidiary is a Wholly Owned Subsidiary organized in [the United States] [Switzerland]
[Japan].  Each of the Company and the New
Borrowing Subsidiary represent and warrant that the representations and
warranties of the Company in the Five Year Credit Agreement relating to the New
Borrowing Subsidiary and this Agreement are true and correct on and as of the
date hereof, other than representations given as of a particular date, in which
case they shall be true and correct as of that date.  The Company agrees that the Guarantee of the
Company contained in the Five Year Credit Agreement will apply to the
Obligations of the New Borrowing Subsidiary. 
Upon execution of this Agreement by each of the Company, the New
Borrowing Subsidiary and the Administrative Agent the New Borrowing Subsidiary
shall be a party to the Five Year Credit Agreement and shall constitute a “[US]
[Swiss] [Japanese] Borrower” for all purposes thereof, and the New Borrowing
Subsidiary hereby agrees to be bound by all provisions of the Five Year Credit
Agreement.

This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York.

 

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

	
  

  	
  EDWARDS LIFESCIENCES

  CORPORATION,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  [NAME OF NEW BORROWING

  SUBSIDIARY]

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE BANK, N.A.,

  as Administrative Agent and Issuing

  Bank,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 2

 

EXHIBIT A-2

[FORM OF]

BORROWING SUBSIDIARY TERMINATION

JPMorgan Chase Bank,
N.A.,

as Administrative Agent

for the Lenders referred
to below

c/o JPMorgan Chase Bank,

as Administrative Agent

270 Park Avenue

New York, NY 10017

[Date]

Ladies and Gentlemen:

The undersigned, Edwards
Lifesciences Corporation (the “Company”), refers to the Amended and Restated
Five Year Credit Agreement dated as of September 29, 2006 (as amended,
supplemented or otherwise modified from time to time, the “Five Year Credit
Agreement”), among the Company, the US Borrowers, the Swiss Borrowers, the
Japanese Borrowers, the Lenders from time to time party thereto, JPMorgan Chase
Bank, N.A., as Administrative Agent and Issuing Bank, J.P. Morgan Europe Limited,
as London Agent, Mizuho Corporate Bank, Ltd., as Tokyo Agent, Bank of America,
N.A., as Syndication Agent and The Bank of Tokyo – Mitsubishi UFJ, Ltd., Mizuho
Corporate Bank, Ltd., Suntrust Bank and Wachovia Bank, N.A., each as
Documentation Agent.  Capitalized terms
used and not otherwise defined herein shall have the meanings assigned to such
terms in the Five Year Credit Agreement.

The Company hereby
terminates the status of [  ] (the “Terminated
Borrowing Subsidiary”) as a [US] [Swiss] [Japanese] Borrower under the Five
Year Credit Agreement.  [The Company
represents and warrants that no Loans made to the Terminated Borrowing
Subsidiary are outstanding as of the date hereof and that all amounts payable
by the Terminated Borrowing Subsidiary in respect of interest and/or fees (and,
to the extent notified by the Administrative Agent or any Lender, any other
amounts payable under the Five Year Credit Agreement) pursuant to the Five Year
Credit Agreement have been paid in full on or prior to the date hereof.]  [The Company acknowledges that the Terminated
Borrowing Subsidiary shall continue to be a Borrower until such time as all
Loans made to the Terminated Borrowing Subsidiary shall have been prepaid and
all amounts payable by the Terminated Borrowing Subsidiary in respect of
interest and/or fees (and, to the extent notified by the Administrative Agent
or any Lender, any other amounts payable under the Five Year Credit Agreement)
pursuant to the Five Year Credit Agreement shall have been paid in full, provided
that the Terminated Borrowing Subsidiary shall not have the right to make
further Borrowings, under the Five Year Credit Agreement.]

 

 

This instrument shall be
construed in accordance with and governed by the laws of the State of New York.

	
  

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  EDWARDS LIFESCIENCES

  CORPORATION,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 2

 

EXHIBIT B

[FORM OF]

ASSIGNMENT AND ACCEPTANCE

Reference is made to the Amended
and Restated Five Year Credit Agreement dated as of September 29, 2006 (as
amended, modified, supplemented or waived, the “Five Year Credit Agreement”),
among Edwards Lifesciences Corporation, the US Borrowers, the Swiss Borrowers,
the Japanese Borrowers, the Lenders from time to time party thereto, JPMorgan
Chase Bank, N.A., as Administrative Agent and Issuing Bank, J.P. Morgan Europe Limited,
as London Agent, Mizuho Corporate Bank, Ltd., as Tokyo Agent, Bank of America,
N.A., as Syndication Agent and The Bank of Tokyo – Mitsubishi UFJ, Ltd., Mizuho
Corporate Bank, Ltd., Suntrust Bank and Wachovia Bank, N.A., each as
Documentation Agent.  Capitalized terms
used but not defined herein shall have the meanings specified in the Five Year
Credit Agreement.

1.  The Assignor named below hereby sells and
assigns, without recourse to the Assignor, to the Assignee named below and the
Assignee hereby purchases and assumes, without recourse to the Assignor, from
the Assignor, effective as of the Assignment Date set forth below, the
interests set forth below (the “Assigned Interest”) in the Assignor’s rights
and obligations under the Five Year Credit Agreement, including, without
limitation, the interests set forth below in the Commitments of the Assignor on
the Assignment Date and the Loans owing to the Assignor which are outstanding
on the Assignment Date.  The Assignor
represents and warrants that it is the legal and beneficial owner of the
interest being assigned by it hereunder and that such interest is free and
clear of any Lien.  The Assignee hereby
acknowledges receipt of a copy of the Five Year Credit Agreement.  From and after the Assignment Date
(i) the Assignee shall be a party to and be bound by the provisions of the
Five Year Credit Agreement and, to the extent of the interests assigned by this
Assignment and Acceptance, have the rights and obligations of a Lender
thereunder and (ii) the Assignor shall, to the extent of the interests assigned
by this Assignment and Acceptance, relinquish its rights and be released from
its obligations under the Five Year Credit Agreement.

2.  This
Assignment and Acceptance is being delivered to the Administrative Agent
together with (i) to the extent required, any documentation required to be
delivered by the Assignee pursuant to Section 2.16 of the Five Year Credit
Agreement, (ii) if the Assignee is not already a Lender under the Agreement, an
Administrative Questionnaire in the form provided by the Administrative Agent
and (iii) a processing and recordation fee in the amount of $3,500.

 

3.  This Assignment and Acceptance shall be
governed by and construed in accordance with the laws of the State of New York.

Date of Assignment:

Legal Name of Assignor:

Legal Name of Assignee:

Assignee’s Address for
Notices:

Effective Date of
Assignment (“Assignment Date”):

 2
 

 

 

	
  Facility

  	
   

  	
  Principal Amount

  Assigned

  	
   

  	
  Percentage Assigned of

  Commitment

  (set forth, to at least 8

  decimals, as a percentage of

  the facility and the aggregate

  Commitments of all Lenders

  thereunder)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  US Tranche
  Commitment Assigned:

  	
   

  	
  $

  	
   

  	
   

  	
  %

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Swiss Tranche
  Commitment Assigned:

  	
   

  	
  $

  	
   

  	
   

  	
  %

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Japanese Tranche
  Commitment Assigned:

  	
   

  	
  $

  	
   

  	
   

  	
  %

  	
   

  
	
  US Tranche
  Revolving Loans:

  	
   

  	
  $

  	
   

  	
   

  	
  %

  	
   

  
	
  Swiss Tranche
  Revolving Loans:

  	
   

  	
  $

  	
   

  	
   

  	
  %

  	
   

  
	
  Japanese Tranche
  Revolving Loans:

  	
   

  	
  $

  	
   

  	
   

  	
  %

  	
   

  

 

The terms set forth herein are hereby agreed to:

 

	
  

  	
  Consented (if required):

  
	
   

  	
   

  
	
   

  	
                                  ,
  as

  
	
   

  	
  Assignor,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  EDWARDS
  LIFESCIENCES

  
	
   

  	
  CORPORATION,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 3
 

 

 

	
  

  	
   

  	
  , as

  
	
   

  	
  Assignee,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Consented (if
  required):

  
	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE
  BANK, N.A.,

  as Administrative Agent,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE
  BANK, N.A.,

  as Issuing Bank,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
					

 4

 

EXHIBIT C

FIVE YEAR SUBSIDIARY
GUARANTEE AGREEMENT dated as of September 29, 2006, among each of the
subsidiaries of EDWARDS LIFESCIENCES CORPORATION, a Delaware corporation (the “Company”),
listed on Schedule I hereto or becoming a party hereto as provided in
Section 15 (the “Subsidiary Guarantors”), and JPMORGAN CHASE BANK, N.A.,
as administrative agent (the “Administrative Agent”) for the Lenders (as
defined in the Credit Agreement referred to below).

Reference is made to the Amended
and Restated Five Year Credit Agreement dated as of September 29, 2006 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among the Company, the other Borrowers party thereto, the
lenders from time to time party thereto (the “Lenders”), JPMorgan Chase
Bank, N.A., as Administrative Agent, J.P. Morgan Europe Limited, as London
Agent, Mizuho Corporate Bank, Ltd., as Tokyo Agent, Bank of America, N.A., as
Syndication Agent and The Bank of Tokyo – Mitsubishi UFJ, Ltd., Mizuho
Corporate Bank, Ltd., Suntrust Bank and Wachovia Bank, N.A., each as
Documentation Agent.  Capitalized terms
used herein and not defined herein shall have the meanings assigned to such
terms in the Credit Agreement.

The Lenders have agreed
to make Loans to the Borrowers pursuant to, and upon the terms and subject to
the conditions specified in, the Credit Agreement.  Each of the Subsidiary Guarantors acknowledges
that it will derive substantial benefit from the making of the Loans by the
Lenders.  The obligations of the Lenders
to make Loans are conditioned on, among other things, the execution and
delivery by the Subsidiary Guarantors of this Subsidiary Guarantee
Agreement.  In order to induce the
Lenders to make Loans, the Subsidiary Guarantors are willing to execute this
Agreement.

Accordingly,
the parties hereto agree as follows:

SECTION 1.  Guarantee.  Each Subsidiary Guarantor unconditionally
guarantees, jointly with the other Subsidiary Guarantors and severally, as a
primary obligor and not merely as a surety, (a) the due and punctual payment of
(i) the principal of and premium, if any, and interest (including interest
accruing during the pendency of any bankruptcy, insolvency, receivership or
other similar proceeding, regardless of whether allowed or allowable in such
proceeding) on the Loans made to any Borrower, when and as due, whether at
maturity, by acceleration, upon one or more dates set for prepayment or
otherwise, and (ii) all other monetary obligations, including fees, costs,
expenses and indemnities, whether primary, secondary, direct, contingent, fixed
or otherwise (including monetary obligations incurred during the pendency of
any bankruptcy, insolvency, receivership or other similar proceeding,
regardless of whether allowed or allowable in such proceeding), of the Loan
Parties under the Credit Agreement and the other Loan Documents, and
(b) unless otherwise agreed upon in writing by the applicable Lender party
thereto, the due and punctual payment and

 

performance of all
obligations of the Company or any Subsidiary, monetary or otherwise, under each
interest rate hedging Agreement relating to Obligations referred to in the
preceding clause (a) entered into with any counterparty that was a Lender (or
an Affiliate thereof) at the time such hedging agreement was entered into (all
the obligations referred to in the preceding clauses (a) and (b) being
collectively called the “Obligations”). 
Each Subsidiary Guarantor agrees that the Obligations may be extended or
renewed, in whole or in part, without notice to or further assent from it, and
that it will remain bound upon its guarantee notwithstanding any extension or
renewal of any Obligation.

Each Subsidiary Guarantor
further agrees that the due and punctual payment of such Obligations may be
extended or renewed, in whole or in part, without notice to or further assent
from it, and that it will remain bound upon its guarantee hereunder notwithstanding
any such extension or renewal of any such Obligation.

Each Subsidiary Guarantor
waives presentment to, demand of payment from and protest to any Borrower of
any of the Obligations, and also waives notice of acceptance of its obligations
and notice of protest for nonpayment. 
The obligations of the Subsidiary Guarantors hereunder shall not be
affected by (a) the failure of any Agent or Lender to assert any claim or
demand or to enforce any right or remedy against any Loan Party under the
provisions of the Credit Agreement, any other Loan Document or otherwise;
(b) any extension or renewal of any of the Obligations; (c) any
rescission, waiver, amendment or modification of, or release from, any of the
terms or provisions of the Credit Agreement, or any other Loan Document or
agreement; (d) any default, failure or delay, wilful or otherwise, in the
performance of any of the Obligations; or (e) any other act, omission or
delay to do any other act which may or might in any manner or to any extent vary
the risk of any Subsidiary Guarantor or otherwise operate as a discharge of a
guarantor as a matter of law or equity or which would impair or eliminate any
right of any Subsidiary Guarantor to subrogation.

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

The obligations of the
Subsidiary Guarantors hereunder shall not be subject to any reduction,
limitation, impairment or termination for any reason, including any claim of
waiver, release, surrender, alteration or compromise of any of the Obligations,
and shall not be subject to any defense or setoff, counterclaim, recoupment or
termination whatsoever, by reason of the invalidity, illegality or
unenforceability of any of the Obligations (including lack of due authorization
or execution of the Credit Agreement, any Loan Document or any other instrument
or agreement), any impossibility in the performance of any of the Obligations
or otherwise.  Without limiting the
generality of the foregoing, the obligations of each Subsidiary Guarantor
hereunder shall not be discharged or impaired or otherwise affected by the
failure of the Administrative

 2
 

 

Agent, the Issuing
Bank or any Lender to assert any claim or demand or to enforce any remedy under
the Credit Agreement, any other Loan Document or any other instrument or
agreement, by any waiver or modification of any provision of any thereof, by
any default, failure or delay, wilful or otherwise, in the performance of the
Obligations, or by any other act or omission that may or might in any manner or
to any extent vary the risk of any Subsidiary Guarantor or that would otherwise
operate as a discharge of each Subsidiary Guarantor as a matter of law or
equity (other than the payment in full in cash of all the Obligations).

Each Subsidiary Guarantor
further agrees that its obligations hereunder shall continue to be effective or
be reinstated, as the case may be, if at any time payment, or any part thereof,
of any Obligation is rescinded or must otherwise be restored by any Agent or
Lender upon the bankruptcy or reorganization of any Borrower or otherwise.

In furtherance of the
foregoing and not in limitation of any other right which any Agent or Lender
may have at law or in equity against any Subsidiary Guarantor by virtue hereof,
upon the failure of any other Borrower to pay any Obligation when and as the
same shall become due, whether at maturity, by acceleration, after notice of
prepayment or otherwise, each Subsidiary Guarantor hereby promises to and will,
upon receipt of written demand by any Agent or Lender, forthwith pay, or cause
to be paid, to the applicable Agent or Lender in cash an amount equal
to the unpaid principal amount of such Obligations then due, together
with accrued and unpaid interest thereon. Each Subsidiary Guarantor
further agrees that if payment in respect of any Obligation shall be due in a
currency other than US Dollars and/or at a place of payment other than
New York and if, by reason of any Change in Law, disruption of currency or
foreign exchange markets, war or civil disturbance or other event, payment of
such Obligation in such currency or at such place of payment shall be
impossible or, in the reasonable judgment of any Agent or Lender, not
consistent with the protection of its rights or interests, then, at the
election of the Administrative Agent, such Subsidiary Guarantor shall make
payment of such Obligation in US Dollars (based upon the applicable Exchange
Rate in effect on the date of payment) and/or in New York, and shall
indemnify each Agent and Lender against any losses or reasonable out-of-pocket
expenses that it shall sustain as a result of such alternative payment.

Upon payment by any
Subsidiary Guarantor of any sums as provided above, all rights of such
Subsidiary Guarantor against any Borrower arising as a result thereof by way of
right of subrogation or otherwise shall in all respects be subordinated and
junior in right of payment to the prior indefeasible payment in full of all the
Obligations owed by such Borrower to the Agents and the Lenders.

Each Subsidiary Guarantor
hereby consents and agrees to the CAM Exchange referred to in the Credit Agreement.

Nothing shall discharge
or satisfy the liability of any Subsidiary Guarantor hereunder except the full
performance and payment of the Obligations.

 3
 

 

SECTION 2.  Defenses
of Company Waived.  To the fullest
extent permitted by applicable law, each of the Subsidiary Guarantors waives
any defense based on or arising out of any defense of the Company or any other
Subsidiary Guarantor or the unenforceability of the Obligations or any part
thereof from any cause, or the cessation from any cause of the liability of the
Company or any other Subsidiary Guarantor, other than the final and payment in
full in cash of the Obligations.  The
Administrative Agent, the Issuing Bank and the Lenders may, at their election,
foreclose on any security held by one or more of them by one or more judicial
or nonjudicial sales, accept an assignment of any such security in lieu of
foreclosure, compromise or adjust any part of the Obligations, make any other
accommodation with the Company, any Subsidiary Guarantor or any other guarantor
or exercise any other right or remedy available to them against the Company,
any Subsidiary Guarantor or any other guarantor, without affecting or impairing
in any way the liability of any Subsidiary Guarantor hereunder except to the
extent the Obligations have been fully, finally and indefeasibly paid in
cash.  Pursuant to applicable law, each
of the Subsidiary Guarantors waives any defense arising out of any such
election even though such election operates, pursuant to applicable law, to
impair or to extinguish any right of reimbursement or subrogation or other
right or remedy of such Subsidiary Guarantor against the Company or any other
Subsidiary Guarantor or guarantor, as the case may be, or any security.

SECTION 3.   Information.  Each of the Subsidiary Guarantors assumes all
responsibility for being and keeping itself informed of the Borrowers’ and the
other Subsidiary Guarantors’ financial condition and assets, and of all other
circumstances bearing upon the risk of nonpayment of the Obligations and the
nature, scope and extent of the risks that such Subsidiary Guarantor assumes
and incurs hereunder, and agrees that none of the Administrative Agent or the
Lenders will have any duty to advise any of the Subsidiary Guarantors of
information known to it or any of them regarding such circumstances or risks.

SECTION 4.  Representations
and Warranties; Agreements.  Each of
the Subsidiary Guarantors represents and warrants as to itself that all
representations and warranties relating to it contained in any Loan Document to
which it is a party are true and correct in all material respects.  Each of the Subsidiary Guarantors agrees that
the provisions of Section 2.16 of the Credit Agreement shall apply equally to
each Guarantor with respect to payments made by it hereunder.

SECTION 5.  Termination.  The Guarantees made hereunder (a) shall,
subject to clause (b) below, terminate when all the Obligations have been paid
in full and the Lenders have no further commitment to lend under the Credit
Agreement and (b) shall continue to be effective or be reinstated, as the case
may be, if at any time payment, or any part thereof, of any Obligation is
rescinded or must otherwise be restored by the Administrative Agent or any
Lender or any Subsidiary Guarantor upon the bankruptcy or reorganization of any
Borrower, any Subsidiary Guarantor or otherwise.  The Guarantee of any Subsidiary Guarantor
shall be automatically released if (i) all the capital stock of such Subsidiary
Guarantor owned by the Company or any Subsidiary shall be sold in a transaction
permitted under the terms of the Credit Agreement and (ii) at the time of such
sale, no Default has occurred and is continuing.

 4
 

 

SECTION 6.  Binding
Agreement; Assignments.  Whenever in
this Agreement any of the parties hereto is referred to, such reference shall
be deemed to include the successors and assigns of such party; and all
covenants, promises and agreements by or on behalf of the Subsidiary Guarantors
that are contained in this Agreement shall bind and inure to the benefit of
each party hereto and their respective successors and assigns.  This Agreement shall become effective as to
any Subsidiary Guarantor when a counterpart hereof executed on behalf of such
Subsidiary Guarantor shall have been delivered to the Administrative Agent, and
a counterpart hereof shall have been executed on behalf of the Administrative
Agent, and thereafter shall be binding upon such Subsidiary Guarantor and the
Administrative Agent and their respective successors and assigns, and shall inure
to the benefit of such Subsidiary Guarantor, the Administrative Agent and the
Lenders, and their respective successors and assigns, except that no Subsidiary
Guarantor shall have the right to assign its rights or obligations hereunder or
any interest herein, and any such attempted assignment shall be void.  This Agreement shall be construed as a
separate agreement with respect to each Subsidiary Guarantor and may be
amended, modified, supplemented, waived or released with respect to any
Subsidiary Guarantor without the approval of any other Subsidiary Guarantor and
without affecting the obligations of any other Subsidiary Guarantor hereunder.

SECTION 7.  Waivers;
Amendment.  (a)  No failure or
delay of the Administrative Agent or any Lender in exercising any power or
right hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power.  The rights and remedies of the Administrative
Agent or any Lender hereunder or under the Credit Agreement or any other Loan
Document are cumulative and are not exclusive of any rights or remedies that
they would otherwise have.  No waiver of
any provision of this Agreement or any other Loan Document or consent to any
departure by any Subsidiary Guarantor therefrom shall in any event be effective
unless the same shall be permitted by paragraph (b) below, and then such
waiver or consent shall be effective only in the specific instance and for the
purpose for which given.  No notice or
demand on any Subsidiary Guarantor in any case shall entitle such Subsidiary
Guarantor to any other or further notice or demand in similar or other
circumstances.

(b)  Neither
this Agreement nor any provision hereof may be waived, amended or modified
except pursuant to a written agreement entered into between the Subsidiary
Guarantors to which such waiver, amendment or modification relates and the
Administrative Agent (with the prior written consent of the Lenders or the
Required Lenders if required under the Credit Agreement).

SECTION 8.  GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

SECTION 9.  Notices.  All communications and notices hereunder
shall be in writing and given as provided in Section 11.01 of the Credit
Agreement.  All

 5
 

 

communications and
notices hereunder to each Subsidiary Guarantor shall be given to it in care of
the Company.

SECTION 10.  Survival
of Agreement; Severability. 
(a)  All covenants, agreements, representations and warranties
made by the Subsidiary Guarantors herein and in the certificates or other
instruments prepared or delivered in connection with or pursuant to this
Agreement shall be considered to have been relied upon by the Administrative
Agent and the Lenders and shall survive the making by the Lenders of the Loans,
regardless of any investigation made by any of them or on their behalf, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any other fee or amount payable under this
Agreement or any other Loan Document is outstanding and unpaid and as long as
the Commitments have not been terminated.

(b)  In the
event any one or more of the provisions contained in this Agreement should be
held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein shall not in
any way be affected or impaired thereby (it being understood that the
invalidity of a particular provision in a particular jurisdiction shall not in
and of itself affect the validity of such provision in any other jurisdiction).  The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to
that of the invalid, illegal or unenforceable provisions.

SECTION 11.  Counterparts.  This Agreement may be executed in
counterparts, each of which shall constitute an original, but all of which when
taken together shall constitute a single contract, and shall become effective
as provided in Section 6.  Delivery
of an executed signature page to this Agreement by facsimile transmission shall
be as effective as delivery of a manually executed counterpart of this
Agreement.

SECTION 12.  Rules
of Interpretation.  The rules of
interpretation specified in Sections 1.03, 1.04 and 1.05 of the Credit
Agreement shall be applicable to this Agreement.

SECTION 13.  Jurisdiction;
Consent to Service of Process. 
(a) Each Subsidiary Guarantor hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of any New York State court or Federal court of the United States
of America sitting in New York City, and any appellate court from any thereof,
in any action or proceeding arising out of or relating to this Agreement, or
for recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York State
or, to the extent permitted by law, in such Federal court.  Each of the parties hereto agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.  Nothing in this Agreement
shall affect any right that the Administrative Agent, the

 6
 

 

Issuing Bank or
any Lender may otherwise have to bring any action or proceeding relating to
this Agreement against any Subsidiary Guarantor or its properties in the courts
of any jurisdiction.

(b)  Each
Subsidiary Guarantor hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement in any New York State or Federal
court.  Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.

(c)  Each party
to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 9. 
Nothing in this Agreement will affect the right of any party to this
Agreement to serve process in any other manner permitted by law.

SECTION 14.  WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT. 
EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO
HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

SECTION 15.  Additional
Subsidiary Guarantors.  Pursuant to
Section 5.09 of the Credit Agreement, certain additional Subsidiaries may
be required under the terms of the Credit Agreement from time to time to enter
into this Agreement as Subsidiary Guarantors. 
Upon execution and delivery by the Administrative Agent and a Subsidiary
of an instrument in the form of Annex 1, such Subsidiary shall become a
Subsidiary Guarantor hereunder with the same force and effect as if originally
named as a Subsidiary Guarantor herein. 
The execution and delivery of such instrument shall not require the
consent of any Subsidiary Guarantor hereunder. 
The rights and obligations of each Subsidiary Guarantor hereunder shall
remain in full force and effect notwithstanding the addition of any new
Subsidiary Guarantor as a party to this Agreement.

SECTION 16.  Right
of Setoff.  If an Event of Default
shall have occurred and be continuing, each of the Administrative Agent and the
Lenders is hereby authorized at any time and from time to time, to the fullest
extent permitted by law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
Indebtedness at any time owing by such Person to or for the credit or

 7
 

 

the account of any
Subsidiary Guarantor against any or all the obligations of such Subsidiary
Guarantor now or hereafter existing under this Agreement held by such Person,
irrespective of whether or not such Person shall have made any demand under
this Agreement and although such obligations may be unmatured.  The rights of each Person under this Section
are in addition to other rights and remedies (including other rights of setoff)
which such Person may have.

SECTION 17.  Conversion of Currencies.  (a)  If, for the purpose of
obtaining judgment in any court, it is necessary to convert a sum owing
hereunder in one currency into another currency, each party hereto agrees, to
the fullest extent that it may effectively do so, that the rate of exchange
used shall be that at which in accordance with normal banking procedures in the
relevant jurisdiction the first currency could be purchased with such other
currency on the Business Day immediately preceding the day on which final
judgment is given.

(b)  The
obligations of each Subsidiary Guarantor in respect of any sum due to any party
hereto or any holder of the obligations owing hereunder (the “Applicable
Creditor”) shall, notwithstanding any judgment in a currency (the “Judgment
Currency”) other than the currency in which such sum is stated to be due
hereunder (the “Agreement Currency”), be discharged only to the extent
that, on the Business Day following receipt by the Applicable Creditor of any
sum adjudged to be so due in the Judgment Currency, the Applicable Creditor may
in accordance with normal banking procedures in the relevant jurisdiction
purchase the Agreement Currency with the Judgment Currency; if the amount of
the Agreement Currency so purchased is less than the sum originally due to the
Applicable Creditor in the Agreement Currency, such Subsidiary Guarantor agrees,
as a separate obligation and notwithstanding any such judgment, to indemnify
the Applicable Creditor against such loss. 
The obligations of the Subsidiary Guarantors contained in this
Section 17 shall survive the termination of this Agreement and the payment
of all other amounts owing hereunder.

IN WITNESS WHEREOF, the
parties hereto have duly executed this Agreement as of the day and year first
above written.

	
  

  	
  [SUBSIDIARY GUARANTORS],

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE
  BANK, N.A.,

  as Administrative Agent,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 8

 

SCHEDULE I TO THE

SUBSIDIARY GUARANTEE AGREEMENT

Subsidiary
Guarantors

ANNEX 1 to the

Guarantee Agreement

SUPPLEMENT NO. [   ]
dated as of [                      ], to the FIVE YEAR
SUBSIDIARY GUARANTEE AGREEMENT dated as of September 29, 2006, among each
of the subsidiaries of EDWARDS LIFESCIENCES CORPORATION, a Delaware corporation
(the “Company”), listed on Schedule I hereto or becoming a party
hereto as provided in Section 15 (the “Subsidiary Guarantors”), and
JPMORGAN CHASE BANK, N.A., as administrative agent (the “Administrative
Agent”) for the Lenders (as defined in the Credit Agreement referred to
below).

A. Reference is made to
the Amended and Restated Five Year Credit Agreement dated as of September 29,
2006 (as amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among the Company, the other Borrowers party thereto, the
lenders from time to time party thereto (the “Lenders”), JPMorgan Chase
Bank, N.A., as Administrative Agent, J.P. Morgan Europe Limited, as London
Agent, Mizuho Corporate Bank, Ltd., as Tokyo Agent, Bank of America, N.A., as
Syndication Agent and The Bank of Tokyo – Mitsubishi UFJ, Ltd., Mizuho
Corporate Bank, Ltd., Suntrust Bank and Wachovia Bank, N.A., each as
Documentation Agent.

B. Capitalized terms used
and not otherwise defined herein shall have the meanings assigned to such terms
in the Guarantee Agreement and the Credit Agreement.

C. The Subsidiary
Guarantors have entered into the Guarantee Agreement in order to induce the
Lenders to make Loans.  The undersigned
Subsidiary of the Company (the “New Subsidiary Guarantor”) is executing
this Supplement in accordance with the requirements of the Credit Agreement to
become a Subsidiary Guarantor under the Guarantee Agreement in order to induce
the Lenders to make additional Loans and as consideration for Loans previously
made.

Accordingly, the
Administrative Agent and the New Subsidiary Guarantor agree as follows:

SECTION 1.  In accordance with Section 15 of the
Guarantee Agreement, the New Subsidiary Guarantor by its signature below
becomes a Subsidiary Guarantor under the Guarantee Agreement with the same
force and effect as if originally named therein as a Subsidiary Guarantor and
the New Subsidiary Guarantor hereby (a) agrees to all the terms and
provisions of the Guarantee Agreement applicable to it as a Subsidiary Guarantor
thereunder and (b) represents and warrants that the representations and
warranties made by it as a Subsidiary Guarantor thereunder are true and correct
on and as of the date hereof, other than representations given as of a
particular date, in which case such representation shall be true and correct as
of such date.  Each reference to a “Subsidiary
Guarantor” in the Guarantee Agreement shall be deemed to include the New

Subsidiary
Guarantor.  The Guarantee Agreement is
hereby incorporated herein by reference.

SECTION 2.  The New Subsidiary Guarantor represents and
warrants to the Administrative Agent and the Lenders that this Supplement has
been duly authorized, executed and delivered by it and constitutes its legal,
valid and binding obligation, enforceable against it in accordance with its
terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium
or other laws affecting creditors’ rights generally and subject to general
principles of equity, regardless of whether considered in a proceeding in
equity or at law.

SECTION 3.  This Supplement may be executed in
counterparts, each of which shall constitute an original, but all of which when
taken together shall constitute a single contract.  This Supplement shall become effective when
the Administrative Agent shall have received counterparts of this Supplement
that, when taken together, bear the signatures of the New Subsidiary Guarantor
and the Administrative Agent.  Delivery
of an executed signature page to this Supplement by facsimile transmission
shall be as effective as delivery of a manually executed counterpart of this
Supplement.

SECTION 4.  Except as expressly supplemented hereby, the
Guarantee Agreement shall remain in full force and effect.

SECTION 5.  THIS
SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK.

SECTION 6.  In case any one or more of the provisions
contained in this Supplement should be held invalid, illegal or unenforceable
in any respect, the validity, legality and enforceability of the remaining
provisions contained herein and in the Guarantee Agreement shall not in any way
be affected or impaired thereby (it being understood that the invalidity of a
particular provision hereof in a particular jurisdiction shall not in and of
itself affect the validity of such provision in any other jurisdiction).  The parties hereto shall endeavor in
good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as close as
possible to that of the invalid, illegal or unenforceable provisions.

SECTION 7.  All communications and notices hereunder
shall be in writing and given as provided in Section 9 of the Guarantee
Agreement.

SECTION 8.  The New Subsidiary Guarantor agrees to
reimburse the Administrative Agent for its reasonable out-of-pocket expenses in
connection with this Supplement, including the reasonable fees, disbursements
and other charges of counsel for the Administrative Agent.

 2
 

IN WITNESS WHEREOF, the
New Subsidiary Guarantor and the Administrative Agent have duly executed this
Supplement to the Guarantee Agreement as of the day and year first above
written.

	
   

  	
  [Name Of New Subsidiary

  
	
   

  	
  Guarantor],

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE
  BANK, N.A.,

  as Administrative Agent,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 3

EXHIBIT D

INDEMNITY, SUBROGATION
and CONTRIBUTION AGREEMENT dated as of September 29, 2006, among EDWARDS
LIFESCIENCES CORPORATION, a Delaware corporation (the “Company”), each
Subsidiary of the Company listed on Schedule I hereto or becoming a party
hereto as provided in Section 12 hereto (the “Subsidiary Guarantors”)
and JPMORGAN CHASE BANK, N.A., as administrative agent (in such capacity, the “Administrative
Agent”) for the Lenders (as defined in the Five Year Credit Agreement
referred to below).

Reference is made
to (a) the Amended and Restated Five Year Credit Agreement dated as of
September 29, 2006 (as amended, supplemented or otherwise modified from
time to time, the “Five Year Credit Agreement”), among the Company, the
US Borrowers, the Swiss Borrowers, the Japanese Borrowers, the lenders from
time to time party thereto (the “Lenders”), JPMorgan Chase Bank, N.A., as
Administrative Agent and Issuing Bank, J.P. Morgan Europe Limited, as London
Agent, Mizuho Corporate Bank, Ltd., as Tokyo Agent, Bank of America, N.A., as
Syndication Agent and The Bank of Tokyo – Mitsubishi UFJ, Ltd., Mizuho
Corporate Bank, Ltd., Suntrust Bank and Wachovia Bank, N.A., each as
Documentation Agent, and (b) the Subsidiary Guarantee Agreement dated as of September 29,
2006, among the Subsidiary Guarantors and the Administrative Agent (as amended,
supplemented or otherwise modified from time to time, the “Subsidiary
Guarantee Agreement”).  Capitalized
terms used herein and not defined herein shall have the meanings assigned to
such terms in the Five Year Credit Agreement.

The Lenders have agreed
to make Loans to the Borrowers and the Issuing Bank has agreed to issue Letters
of Credit pursuant to, and upon the terms and subject to the conditions
specified in, the Five Year Credit Agreement. 
The Subsidiary Guarantors have guaranteed the Loans made to the
Borrowers and the other Obligations (as defined in the Subsidiary Guarantee
Agreement) under the Five Year Credit Agreement or any other Loan Document
pursuant to the Subsidiary Guarantee Agreement. 
The obligations of the Lenders to make Loans are conditioned on, among
other things, the execution and delivery by the Borrowers and the Subsidiary
Guarantors of an agreement in the form hereof.

Accordingly, each
Borrower, each Subsidiary Guarantor and the Administrative Agent agree as
follows:

SECTION 1.  Indemnity
and Subrogation.  (a)  In
addition to all such rights of indemnity and subrogation as the Subsidiary
Guarantors may have under applicable law (but subject to Section 3), the
Company agrees that in the event a payment shall be made by any Subsidiary
Guarantor under the Subsidiary Guarantee Agreement, the Company shall indemnify
such Subsidiary Guarantor for the full amount of such

payment, and the
Company shall be subrogated to the rights of the Subsidiary Guarantor to whom
such payment shall have been made to the extent of such payment.

(b)  In addition to
all such rights of indemnity and subrogation as the Subsidiary Guarantors may
have under applicable law (but subject to Section 3), each US Borrower, Swiss
Borrower and Japanese Borrower agrees that in the event a payment shall be made
by any Subsidiary Guarantor under the Subsidiary Guarantee Agreement with
respect to an Obligation of such Borrower, such Borrower shall indemnify such
Subsidiary Guarantor for the full amount of such payment, and such Subsidiary
Guarantor shall be subrogated to the rights of the Person to whom such payment
shall have been made to the extent of such payment.

SECTION 2.  Contribution and Subrogation.  Each Subsidiary Guarantor (a “Contributing
Subsidiary Guarantor”) agrees (subject to Section 3) that, in the
event a payment shall be made by any other Subsidiary Guarantor under the
Subsidiary Guarantee Agreement and such other Subsidiary Guarantor (the “Claiming
Subsidiary Guarantor”) shall not have been fully indemnified by the
Borrowers as provided in Section 1, each Contributing Subsidiary Guarantor
shall indemnify the Claiming Subsidiary Guarantor in an amount equal to the
amount of such payment multiplied by a fraction of which the numerator shall be
the net worth of the Contributing Subsidiary Guarantor on the date hereof or on
the date on which enforcement is being sought, whichever is greater, and the
denominator shall be the aggregate of the respective net worths of all the
Subsidiary Guarantors on the date hereof (or, in the case of any Subsidiary
Guarantor becoming a party hereto pursuant to Section 12, the date of the
Supplement hereto executed and delivered by such Subsidiary Guarantor) or the
date on which enforcement is being sought, whichever is greater.  Any Contributing Subsidiary Guarantor making
any payment to a Claiming Subsidiary Guarantor pursuant to this Section 2
shall be subrogated to the rights of such Claiming Subsidiary Guarantor under
Section 1 to the extent of such payment.

SECTION 3.  Subordination.  Notwithstanding any provision of this
Agreement to the contrary, all rights of the Subsidiary Guarantors under
Sections 1 and 2 and all other rights of indemnity, contribution or
subrogation under applicable law or otherwise shall be fully subordinated to
the indefeasible payment in full in cash of the Obligations.  No failure on the part of any Borrower or any
Subsidiary Guarantor to make the payments required by Sections 1 and 2 (or
any other payments required under applicable law or otherwise) shall in any
respect limit the obligations and liabilities of any Subsidiary Guarantor with
respect to its obligations hereunder, and each Subsidiary Guarantor shall
remain liable for the full amount of the obligations of such Subsidiary
Guarantor hereunder.  The subordination
effected by this Section 3 shall prohibit (i) any exercise of a
set-off in respect of the subordinated obligations, (ii) the commencement
of any action seeking to enforce the subordinated obligations and
(iii) the assignment of subordinated obligations.  Any Subsidiary Guarantor receiving any
payment in respect of a subordinated obligation in violation of this
Section 3 shall be deemed to have received such payment in trust for the
benefit of the Administrative Agent and immediately turn over such amount to
the Administrative Agent for application in respect of the Obligations.

 2
 

SECTION 4.  Termination.  This Agreement shall survive and be in full
force and effect so long as any Obligation is outstanding and has not been
indefeasibly paid in full in cash or the Commitments under the Five Year Credit
Agreement have not been terminated, and shall continue to be effective or be
reinstated, as the case may be, if at any time payment, or any part thereof, of
any Obligation is rescinded or must otherwise be restored by the Administrative
Agent, the Issuing Bank or any Lender or any Subsidiary Guarantor upon the
bankruptcy or reorganization of any Borrower, any Subsidiary Guarantor or
otherwise.

SECTION 5.  GOVERNING
LAW.  THIS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.

SECTION 6.  No Waiver; Amendment.  (a) No failure on the part of the
Administrative Agent, the Issuing Bank or any Subsidiary Guarantor to exercise,
and no delay in exercising, any right, power or remedy hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise of any such
right, power or remedy by the Administrative Agent, the Issuing Bank or any
Subsidiary Guarantor preclude any other or further exercise thereof or the
exercise of any other right, power or remedy. 
All remedies hereunder are cumulative and are not exclusive of any other
remedies provided by law.  None of the
Administrative Agent, the Issuing Bank and the Subsidiary Guarantors shall be
deemed to have waived any rights hereunder unless such waiver shall be in
writing and signed by such parties.

(b) Neither this
Agreement nor any provision hereof may be waived, amended or modified except
pursuant to a written agreement entered into between the Borrowers, the
Subsidiary Guarantors and the Administrative Agent (with the prior written
consent of the Lenders or the Required Lenders if required under the Five Year
Credit Agreement).

SECTION 7.  Notices.  All communications and notices hereunder
shall be in writing and given as provided in the Subsidiary Guarantee Agreement
and addressed as specified therein.

SECTION 8.  Binding Agreement; Assignments.  Whenever in this Agreement any of the parties
hereto is referred to, such reference shall be deemed to include the successors
and assigns of such party; and all covenants, promises and agreements by or on
behalf of the parties that are contained in this Agreement shall bind and inure
to the benefit of their respective successors and assigns.  Neither any Borrower nor any Subsidiary
Guarantor may assign or transfer any of its rights or obligations hereunder
(and any such attempted assignment or transfer shall be void) without the prior
written consent of the Required Lenders, except in connection with any
transaction permitted by Section 6.04 of the Five Year Credit
Agreement.  Notwithstanding the
foregoing, at the time any Subsidiary Guarantor is released from its
obligations under the Subsidiary Guarantee Agreement in accordance with such
Subsidiary Guarantee Agreement and the Five Year Credit Agreement, such Subsidiary
Guarantor will cease to have any rights or obligations under this Agreement.

 3
 

SECTION 9.  Survival of Agreement; Severability.  (a) All covenants and agreements made by each
Borrower and Subsidiary Guarantor herein and in the certificates or other
instruments prepared or delivered in connection with this Agreement shall be
considered to have been relied upon by the Administrative Agent, the Issuing
Bank, the Lenders and each other Subsidiary Guarantor and shall survive the
making by the Lenders of the Loans and the issuance of Letters of Credit by the
Issuing Bank and shall continue in full force and effect as long as the
principal of or any accrued interest on any Loans or any other fee or amount
payable under the Five Year Credit Agreement, this Agreement or any other Loan
Document is outstanding and unpaid and as long as the Commitments have not been
terminated.

(b) In the event that any
one or more of the provisions contained in this Agreement should be held
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not in any
way be affected or impaired thereby (it being understood that the invalidity of
a particular provision in a particular jurisdiction shall not in and of itself
affect the validity of such provision in any other jurisdiction).  The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to
that of the invalid, illegal or unenforceable provisions.

SECTION 10.  Counterparts.  This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract.  This
Agreement shall be effective with respect to any Subsidiary Guarantor when a
counterpart bearing the signature of such Subsidiary Guarantor shall have been
delivered to the Administrative Agent. 
Delivery of an executed signature page to this Agreement by facsimile
transmission shall be as effective as delivery of a manually signed counterpart
of this Agreement.

SECTION 11.  Rules of Interpretation.  The rules of interpretation specified in
Sections 1.03, 1.04 and 1.05 of the Five Year Credit Agreement shall be
applicable to this Agreement.

SECTION 12.  Additional Subsidiary Guarantors.  Pursuant to Section 5.09 of the Five
Year Credit Agreement, each applicable Subsidiary of the Company that was not
in existence or not such a Subsidiary on the date of the Five Year Credit
Agreement is required to enter into this Agreement as a Subsidiary Guarantor
upon becoming such a Subsidiary.  Upon
execution and delivery, after the date hereof, by the Administrative Agent and
such a Subsidiary of an instrument in the form of Annex 1 hereto, such
Subsidiary shall become a Subsidiary Guarantor hereunder with the same force
and effect as if originally named as a Subsidiary Guarantor hereunder.  The execution and delivery of any instrument
adding an additional Subsidiary Guarantor as a party to this Agreement shall
not require the consent of any Subsidiary Guarantor hereunder.  The rights and obligations of each Subsidiary
Guarantor hereunder shall remain in full force and effect notwithstanding the
addition of any new Subsidiary Guarantor as a party to this Agreement.

 4
 

SECTION 13.  Jurisdiction;
Consent to Service of Process. 
(a) Each Subsidiary Guarantor hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of any
New York State court or Federal court of the United States of America sitting
in New York City, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Agreement, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court. 
Each of the parties hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by
law.  Nothing in this Agreement shall
affect any right that the Administrative Agent, the Issuing Bank or any Lender
may otherwise have to bring any action or proceeding relating to this Agreement
against any Subsidiary Guarantor or its properties in the courts of any
jurisdiction.

(b)  Each
Subsidiary Guarantor hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement in any New York State or Federal
court.  Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.

(c)  Each party
to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 7. 
Nothing in this Agreement will affect the right of any party to this
Agreement to serve process in any other manner permitted by law.

SECTION 14.  Waiver of Jury Trial.  EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT. 
EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO
HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 5
 

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

	
   

  	
  EDWARDS LIFESCIENCES

  CORPORATION,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  [US, Swiss and
  Japanese Borrowers]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [SUBSIDIARY
  GUARANTORS]

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE
  BANK, N.A.,

  as Administrative Agent and Issuing

  Bank,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 6

SCHEDULE I

to the Indemnity, Subrogation

and Contribution Agreement

SUBSIDIARY GUARANTORS

ANNEX 1 to

the Indemnity, Subrogation and

Contribution Agreement

SUPPLEMENT NO.
[   ] dated as of [               ], to the Indemnity, Subrogation
and Contribution Agreement dated as of September 29, 2006 (as the same may
be amended, supplemented or otherwise modified from time to time, the “Indemnity,
Subrogation and Contribution Agreement”), among EDWARDS LIFESCIENCES
CORPORATION, a Delaware corporation (the “Company”), each Subsidiary of
the Company listed on Schedule I thereto (the “Subsidiary Guarantors”),
and JPMORGAN CHASE BANK, N.A., as administrative agent (the “Administrative
Agent”) for the Lenders (as defined in the Five Year Credit Agreement
referred to below).

A.  Reference is made to (a) the Amended and
Restated Five Year Credit Agreement dated as of September 29, 2006 (as
amended, supplemented or otherwise modified from time to time, the “Five
Year Credit Agreement”), among the Company, the Swiss Borrowers, the
Japanese Borrowers, the lenders from time to time party thereto (the “Lenders”),
JPMorgan Chase Bank, N.A., as Administrative Agent and Issuing Bank, J.P.
Morgan Europe Limited, as London Agent, Mizuho Corporate Bank, Ltd., as Tokyo
Agent, Bank of America, N.A., as Syndication Agent and The Bank of Tokyo – Mitsubishi
UFJ, Ltd., Mizuho Corporate Bank, Ltd., Suntrust Bank and Wachovia Bank, N.A.,
each as Documentation Agent, and (b) the Subsidiary Guarantee Agreement dated
as of September 29, 2006, among the Subsidiary Guarantors and the
Administrative Agent (as amended, supplemented or otherwise modified from time
to time, the “Subsidiary Guarantee Agreement”).

B.  Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such terms in the
Indemnity, Subrogation and Contribution Agreement and the Five Year Credit
Agreement.

C.  The Borrowers, the Subsidiary Guarantors and
the Administrative Agent have entered into the Indemnity, Subrogation and
Contribution Agreement in order to induce the Lenders to make Loans and the
Issuing Bank to issue Letters of Credit. 
Pursuant to Section 5.09 of the Five Year Credit Agreement, each
Material Subsidiary of the Company that is not a Foreign Subsidiary and that
was not in existence or not such a Subsidiary on the date of the Five Year
Credit Agreement is required to enter into the Indemnity, Subrogation and
Contribution Agreement as a Subsidiary Guarantor upon becoming a Material
Subsidiary.  Section 12 of the
Indemnity, Subrogation and Contribution Agreement provides that additional
Subsidiaries of the Company may become Subsidiary Guarantors under the
Indemnity, Subrogation and Contribution Agreement by execution and delivery of
an instrument in the form of this Supplement. 
The undersigned Subsidiary of the Company (the “New Subsidiary
Guarantor”) is executing this Supplement in accordance with the
requirements of the Five Year Credit

Agreement to
become a Subsidiary Guarantor under the Indemnity, Subrogation and Contribution
Agreement in order to induce the Lenders to make additional Loans and the
Issuing Bank to issue Letters of Credit and as consideration for Loans
previously made and Letters of Credit previously issued.

Accordingly, the
Administrative Agent and the New Subsidiary Guarantor agree as follows:

SECTION 1.  In accordance with Section 12 of the
Indemnity, Subrogation and Contribution Agreement, the New Subsidiary Guarantor
by its signature below becomes a Subsidiary Guarantor under the Indemnity,
Subrogation and Contribution Agreement with the same force and effect as if
originally named therein as a Subsidiary Guarantor and the New Subsidiary
Guarantor hereby agrees to all the terms and provisions of the Indemnity,
Subrogation and Contribution Agreement applicable to it as a Subsidiary
Guarantor thereunder.  Each reference to
a “Subsidiary Guarantor” in the Indemnity, Subrogation and Contribution
Agreement shall be deemed to include the New Subsidiary Guarantor.  The Indemnity, Subrogation and Contribution
Agreement is hereby incorporated herein by reference.

SECTION 2.  The New Subsidiary Guarantor represents and
warrants to the Administrative Agent, the Issuing Bank and the Lenders that
this Supplement has been duly authorized, executed and delivered by it and
constitutes its legal, valid and binding obligation, enforceable against it in
accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors’ rights generally
and subject to general principles of equity, regardless of whether considered
in a proceeding in equity or at law.

SECTION 3.  This Supplement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract.  This
Supplement shall become effective when the Administrative Agent shall have
received counterparts of this Supplement that, when taken together, bear the
signatures of the New Subsidiary Guarantor and the Administrative Agent.  Delivery of an executed signature page to
this Supplement by facsimile transmission shall be as effective as delivery of
a manually signed counterpart of this Supplement.

SECTION 4.  Except as expressly supplemented hereby, the
Indemnity, Subrogation and Contribution Agreement shall remain in full force
and effect.

SECTION 5.  THIS
SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK.

SECTION 6.  In the event that any one or more of the
provisions contained in this Supplement should be held invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein and in the Indemnity, Subrogation and
Contribution Agreement shall not in any

 2
 

way be affected or
impaired thereby (it being understood that the invalidity of a particular
provision in a particular jurisdiction shall not in and of itself affect the
validity of such provision in any other jurisdiction).  The parties hereto shall endeavor in goodfaith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to
that of the invalid, illegal or unenforceable provisions.

SECTION 7.  All communications and notices hereunder
shall be in writing and given as provided in Section 7 of the Indemnity,
Subrogation and Contribution Agreement. 
All communications and notices hereunder to the New Subsidiary Guarantor
shall be given to it at the address set forth under its signature.

SECTION 8.  The New Subsidiary Guarantor agrees to
reimburse the Administrative Agent for its out-of-pocket expenses in connection
with this Supplement, including the reasonable fees, other charges and
disbursements of counsel for the Administrative Agent.

 3
 

IN WITNESS WHEREOF, the
New Subsidiary Guarantor and the Administrative Agent have duly executed this
Supplement to the Indemnity, Subrogation and Contribution Agreement as of the
day and year first above written.

	
   

  	
  [Name Of New Subsidiary

  Guarantor],

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
  Address:

  
	
   

  	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE
  BANK, N.A.,

  as Administrative Agent and Issuing

  Bank,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 4

SCHEDULE I

to Supplement No.     
to the Indemnity,

Subrogation and Contribution Agreement

SUBSIDIARY GUARANTORS

	
  Name

  	
   

  	
  Address

  	
   

  
	
            

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
            

  	
   

  	
   

  	
   

  

 

 

 

	
  

  	
  SIDLEY AUSTIN LLP

  	
  BEIJING

  	
  GENEVA

  	
  SAN FRANCISCO

  
	
  787 SEVENTH AVENUE

  	
  BRUSSELS

  	
  HONG KONG

  	
  SHANGHAI

  
	
  NEW YORK, NY  10019

  	
  CHICAGO

  	
  LONDON

  	
  SINGAPORE

  
	
  (212) 839 5300

  	
  DALLAS

  	
  LOS ANGELES

  	
  TOKYO

  
	
  (212) 839 5599 FAX

  	
  FRANKFURT

  	
  NEW YORK

  	
  WASHINGTON, DC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  FOUNDED 1866

  	
   

  	
   

  

 

EXHIBIT E-1

September 29, 2006

To each Agent and
each Lender

party to the Credit Agreement

(each as described below) on the date hereof

Re:                               Amended
and Restated Five Year Credit Agreement dated as of the date hereof

Ladies and Gentlemen:

We have acted as special
counsel to Edwards Lifesciences Corporation, a Delaware corporation (“ELC”),
Edwards Lifesciences (U.S.) Inc., a Delaware corporation (“ELUS”), Edwards
Lifesciences LLC, a Delaware limited liability company (“Edwards LLC”), Edwards
Lifesciences World Trade Corporation, a Delaware corporation (“ELWT”), Edwards
Lifesciences AG, a Swiss company (“ELAG”), Edwards Lifesciences (Japan)
Limited, a Japanese company (“ELJ,” and, together with ELC, ELUS, Edwards LLC,
ELWT and ELAG, the “Borrowers”), Edwards Lifesciences Research Medical, Inc., a
Utah corporation, Edwards Lifesciences Corporation of Puerto Rico, a Delaware
corporation, and Edwards Lifesciences Sales Corporation, a Delaware
corporation, (collectively, excluding ELC, ELAG and ELJ, the “Subsidiary
Guarantors,” and, together with ELC, ELAG and ELJ, the “Companies”) in
connection with the preparation, execution and delivery of the Amended and
Restated Five Year Credit Agreement dated as of the date hereof (the “Credit
Agreement”) by and among the Borrowers, the lenders parties thereto (the “Lenders”),
JPMorgan Chase Bank, N.A., as Administrative Agent (the “Administrative Agent”),
J.P. Morgan Europe Limited, as London Agent (the “London Agent”), Mizuho Corporate
Bank, Ltd., as the Tokyo Agent (the “Tokyo Agent”), Bank of America, N.A., as
Syndication Agent (“Syndication Agent”), and The Bank of Tokyo-Mitsubishi UFJ,
Ltd., Mizuho Corporate Bank, Ltd., SunTrust Bank, and Wachovia Bank, N.A., as
Documentation Agents (the “Documentation Agents,” and, together with the
Administrative Agent, the London Agent, the Tokyo Agent and the Syndication
Agent, the “Agents”).  All capitalized
terms used in this opinion shall have the meanings attributed to them in the
Credit Agreement.

In
that connection we have examined the following documents (each of which is
dated as of the date hereof):

(i)            Counterparts of the Credit
Agreement, executed by each party thereto;

(ii)           Counterparts of the Indemnity,
Subrogation and Contribution Agreement, executed by the Companies;

(iii)          Counterparts of the Subsidiary
Guarantee, executed by each Subsidiary Guarantor;

 

 

(iv)          The
opinion of Jay P. Wertheim, Vice President, Associate General Counsel and Secretary of ELC; and

(v)           The officer’s certificates attached
hereto as Exhibit A.

The documents
described in items (i) through (iii) above are collectively referred to herein
as the “Loan Documents”.

For purposes of
this opinion, we have made, with your consent, and without further inquiry as
to their accuracy or completeness, the following assumptions:

A.            We
have assumed that the Loan Documents were duly and properly authorized, executed
and delivered by the parties thereto.

B.            We
have assumed the genuineness of all signatures, the legal capacity of all
natural persons executing documents, the authenticity of all documents
submitted to us as originals and the conformity with the authentic originals of
all documents submitted to us as copies, including, without limitation, the
contents of exhibits and schedules to such documents.

C.            We
have assumed that the Loan Documents (i) constitute the entire agreement
of the parties as to the subject matter thereof, (ii) have not been
amended, modified, terminated or revoked in any respect, and (iii) remain
in full force and effect as of the date hereof.

D.            We
have assumed that all of the parties to the Loan Documents are duly organized,
validly existing and in good standing under the laws of their respective
jurisdictions of organization and have the requisite power to enter into the
Loan Documents.

E.             We
have assumed that the execution, delivery and performance of the Loan Documents
by each party thereto do not and will not conflict with, result in a breach of,
or constitute a default under, any of the terms, conditions, or provisions
of:  (a) any present statute, rule,
or regulation applicable to such Person; (b) the charter, code of
regulations, operating agreement, or bylaws (or similar documents) of such
Person; (c) any term of any agreement, contract, undertaking, indenture,
or instrument by which such Person or the properties or assets of such Person
is bound; or (d) any order, judgment, or decree of any court or other
agency of government that is binding on such Person.

F.             We
have assumed that each Lender and each Agent have the requisite power and
authority, have obtained all necessary consents, licenses and permits, taken
all necessary action and complied with any and all applicable laws with which
each is required to comply, in each case relating to or affecting the matters
and actions contemplated by the Loan Documents.

 2
 

 

To the extent that our opinions expressed below
involve conclusions as to the matters set forth in the opinion of counsel
referred to in item (iv) above, we have assumed without independent
investigation the correctness of the opinions set forth therein.

Based upon the foregoing
examination of documents and the assumptions set forth herein and upon such
investigation as we have deemed necessary, we are of the opinion that:

1.             Each Loan Document is the legal, valid and binding
obligation of each Company that is a party thereto, enforceable against it in
accordance with its respective terms.

2.             None of the Companies is an “investment company” within the meaning of and required to be
registered under the Investment Company Act of 1940, as amended.

3.             The making of the Loans and the other extensions of
credit to the Borrowers under the Credit Agreement and, to our knowledge, the
application of the proceeds of the Loans thereunder in accordance with the
terms thereof do not violate Regulations U, or X of the Board of Governors of
the Federal Reserve System.

This opinion is further
subject to the following limitations, qualifications and exceptions:

A.            This
opinion is limited solely to matters of law of the State of New York and the
federal laws of the United States, as those laws are in effect as of the date
hereof, and we express no opinion as to the laws of any other jurisdiction,
including but not limited to, ordinances, regulations or practices of any
county, city or other government agency or body within any state.

B.            This
opinion is subject to the following qualifications:

1.             The
effect of applicable bankruptcy, reorganization, insolvency, receivership,
moratorium, fraudulent conveyance, fraudulent transfer and similar laws
relating to or affecting the rights and remedies of creditors or secured
parties;

2.             Limitations
which may arise under general principles of equity including concepts of
materiality, reasonableness, good faith and fair dealing (regardless of whether
considered in a proceeding at law or in equity);

3.             Limitations
upon the availability of any one or more specific remedies (such as injunctive
relief or the remedy of specific performance) which may arise under general
principles of equity;

4.             The enforceability of Section 11.03
of the Credit Agreement (and any other similar provisions contained in the Loan
Documents) may be limited by (a) laws, rules and regulations (including any
U.S. federal or state securities law, rule or regulation) rendering 

 3
 

 

unenforceable
indemnification contrary to any such laws, rules or regulations and the public
policy underlying such laws, rules or regulations, (b) laws limiting the
enforceability of provisions exculpating or exempting a party from, or
requiring indemnification of a party against or contribution to a party for,
liability for its own negligence, misconduct or bad faith or the negligence,
misconduct or bad faith of its agents and (c) laws requiring collection and
enforcement costs (including fees and disbursements of counsel) to be
reasonable;

5.             No opinion is expressed herein as
to the enforceability of provisions in any Loan Documents to the effect that
terms may not be waived or modified except in writing; and

6.             No opinion is expressed herein as
to (a) the effect of the laws of any jurisdiction in which any Lender is
located (other than the State of New York) that limit the interest, fees or
other charges such Lender may impose, (b) Section 11.09 of the Credit Agreement
(and any similar provisions in any other Loan Document) insofar as such Section
relates to the subject matter jurisdiction of the United States District Court
for the Southern District of New York to adjudicate any controversy related to
the Loan Documents, (c) Section 11.13 of the Credit Agreement (and in each case
any similar provision contained in any other Loan Document) and the first
sentence of Section 11.09(d), or (d) any provision of the Loan Documents
governing rights to set off to be made other than in accordance with applicable
law.  In connection with the provisions
of the Loan Documents which relate to forum selection (including any waiver of
any objection to venue in any court or of any objection that a court is an
inconvenient forum), we note that, under Section 510 of the New York Civil
Practice Law and Rules, a New York state court may have discretion to transfer
the place of trial and a United States District Court has discretion to
transfer an action to another United States District Court pursuant to 28
U.S.C. §1404(a) and to dismiss a cause of action on the grounds of forum non conveniens, and can exercise such discretion sua sponte.

This opinion is limited
to the matters expressly set forth herein, and no opinion is implied or may be
inferred beyond the matters expressly set forth herein.  The opinions expressed herein are being
delivered to you as of the date hereof in connection with the transactions
described hereinabove and are solely for your benefit in connection with the
transactions described hereinabove and may not be relied on in any manner or
for any purpose by any other person, nor any copies published, communicated or
otherwise made available in whole or in part to any other person or entity
without our specific prior written consent, except that you may furnish copies
thereof (i) to any of your permitted successors and assigns in respect of
the Loan Documents, although any such assignee may rely on this opinion only to
the extent it would have been able to rely hereon if it were a party to such
Loan Documents on the date hereof, (ii) to your independent auditors and
attorneys, (iii) upon the request of any state or federal authority or
official having regulatory jurisdiction over you, and (iv) pursuant to
order or legal process of any court or governmental agency.

 4
 

 

This opinion speaks solely as of the date hereof and
we disclaim any obligation or undertaking to advise you of any changes which
may occur after the date hereof.

Very
truly yours,

 5
 

 

EXHIBIT A

OFFICER’S
CERTIFICATES

See attached.

 6

EXHIBIT E-2

September 29, 2006

To each Agent and each Lender

party to the Credit Agreement

(each as described below) on the date hereof

Re:          Amended
and Restated Five Year Credit Agreement dated as of the date hereof

Ladies and Gentlemen:

This opinion is furnished in connection with Section
4.01(b)(ii) of the Amended and Restated Five Year Credit Agreement dated as of
the date hereof (the “Credit Agreement”) by and among Edwards Lifesciences
Corporation, a Delaware corporation (“ELC”), Edwards Lifesciences (U.S.) Inc.,
a Delaware corporation (“ELUS”), Edwards Lifesciences LLC, a Delaware limited
liability company (“Edwards LLC”), Edwards Lifesciences World Trade
Corporation, a Delaware corporation (“ELWT”), Edwards Lifesciences AG, a Swiss
company (“ELAG”), Edwards Lifesciences (Japan) Limited, a Japanese company (“ELJ”
and, together with ELC; ELUS, Edwards LLC, ELWT and ELAG, the “Borrowers”), the
lenders parties thereto (the “Lenders”), JPMorgan Chase Bank, N.A., as
Administrative Agent (the “Administrative Agent”), J.P. Morgan Europe Limited,
as London Agent (the “London Agent”), Mizuho Corporate Bank, Ltd., as the Tokyo
Agent (the “Tokyo Agent”), Bank of America, N.A., as Syndication Agent (“Syndication
Agent”), and The Bank of Tokyo-Mitsubishi UFJ, Ltd., Mizuho Corporate Bank, Ltd.,
SunTrust Bank, and Wachovia Bank, N.A., as Documentation Agents (the “Documentation
Agents,” and, together with the Administrative Agent, the London Agent, the
Tokyo Agent and the Syndication Agent, the “Agents”).  All capitalized terms used in this opinion
shall have the meanings attributed to them in the Credit Agreement.

I am Vice President, Associate General Counsel and
Secretary of ELC, which is the direct or indirect parent of the following
subsidiaries: ELUS; Edwards LLC; ELWT; Edwards Lifesciences Research Medical,
Inc., a Utah corporation; Edwards Lifesciences Corporation of Puerto Rico, a
Delaware corporation, and Edwards Lifesciences Sales Corporation, a Delaware
corporation (collectively, excluding ELC, the “Subsidiary Guarantors,” and, together
with ELC, the “Companies”).  I have acted
as counsel for the Companies in connection with the preparation, execution and
delivery of the Credit Agreement and the other Loan Documents (as defined
below).

In that connection I have examined:

(i)            The
Credit Agreement, executed by each party thereto;

 

 

(ii)           The
Indemnity, Subrogation and Contribution Agreement, dated as of the date hereof,
executed by the Companies;

(iii)          The
Subsidiary Guarantee Agreement, dated as of the date hereof, executed by the
Subsidiary Guarantors;

(iv)          The
Certificates of Incorporation of ELC and (with the exception of Edwards LLC)
each Subsidiary Guarantor, and all amendments thereto and restatements thereof
in effect on the date hereof (the “Charters”);

(v)           The
bylaws of ELC and (with the exception of Edwards LLC) each Subsidiary
Guarantor, and all amendments thereto and restatements thereof in effect on the
date hereof (the “Bylaws”);

(vi)          The
Certificate of Formation of Edwards LLC;

(vii)         The
Restated Operating Agreement of Edwards LLC;

(viii)        The
Certificates of Status and Good Standing Letters for the Companies, as
described on Exhibit A attached hereto and made a part hereof; and

(ix)           All
of the other documents furnished by the Companies pursuant to Section 4.01 of the
Credit Agreement.

The documents described in items (i) through (iii)
above are collectively referred to herein as the “Loan Documents.”  I am also relying on certificates of the
chief financial officers of the Companies, dated the date hereof and attached
hereto as Exhibit B.  In addition,
l have examined the originals, or copies certified to my satisfaction, of such
other corporate records of the Companies, certificates of public officials and
of other officers of the Companies, and agreements, instruments and documents,
as l have deemed necessary as a basis for the opinions hereinafter expressed.  As to questions of fact material to such
opinions, I have, when relevant facts were not independently established by me,
relied upon certificates of other officers of the Companies or of public
officials.

For purposes of this opinion, I have made, with your
consent, and without further inquiry as to their accuracy or completeness, the
following assumptions:

A.            I
have assumed that, except with respect to the Companies, where required, the
Loan Documents were duly and properly authorized, executed and delivered by the
parties thereto.

B.            I
have assumed the genuineness of all signatures, other than signatures of
officers of the Companies, the legal capacity of all natural 

 2
 

 

persons executing
documents, the authenticity of all documents submitted to me as originals and
the conformity with the authentic originals of all documents submitted to me as
copies, including, without limitation, the contents of exhibits and schedules
to such documents.

C.            I
have assumed that the Loan Documents (i) constitute the entire agreement of the
parties as to the subject matter thereof, (ii) have not been amended, modified,
terminated or revoked in any respect, and (iii) remain in full force and effect
as of the date hereof.

D.            I
have assumed that, except with respect to the Companies, all of the parties to
the Loan Documents are duly organized, validly existing and in good standing
under the laws of their respective jurisdictions of organization and have the
requisite corporate power to enter into the Loan Documents.

E.             I
have assumed that, except with respect to the Companies, the execution,
delivery and performance of the Loan Documents by each party thereto do not and
will not conflict with, result in a breach of, or constitute a default under,
any of the terms, conditions, or provisions of: (a) any present statute, rule,
or regulation applicable to such Person; (b) the charter; code of regulations,
operating agreement, or bylaws (or similar documents) of such Person; (c) any
term of any agreement, contract, undertaking, indenture, or instrument by which
such Person or the properties or assets of such Person is bound; or (d) any
order, judgment, or decree of any court or other agency of government that is
binding on any Person.

F.             I
have assumed that each Lender and each Agent have the requisite power and
authority, have obtained all necessary consents, licenses and permits, taken
all necessary action and complied with any and all applicable laws with which
each is required to comply, in each case relating to or affecting the matters
and actions contemplated by the Loan Documents.

Based upon the foregoing, I am of the opinion that:

1.             Each of the Companies (other than
Edwards LLC) is a corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation and has all
requisite authority to conduct its business in each jurisdiction in which the
failure so to qualify would have a material adverse effect on the business,
properties, assets, operations or condition (financial or otherwise) of such
Company. Edwards LLC is a limited liability company duly formed, validly
existing and in good standing under the laws of Delaware and has all requisite
authority to conduct its business in each jurisdiction in which the failure so
to qualify would have a material adverse effect on the business, properties,
assets, operations or condition (financial or otherwise) of such Company.

 3
 

 

2.             The execution, delivery and
performance as of the date hereof by each of the Companies of the Loan
Documents to which it is a party, and the performance as of the date hereof of
the transactions contemplated by the Loan Documents to which it is a party: (i)
are within its corporate or limited liability company (as applicable) powers;
(ii) have been duly authorized by all necessary corporate or limited liability
company (as applicable) action; (iii) do not, as of the date hereof, contravene
(a) with respect to all the Companies other than Edwards LLC, the Charter or
the Bylaws of such Company, (b) with respect to Edwards LLC, the Restated
Operating Agreement or the Certificate of Formation, or (c) any law, rule or
regulation applicable to any Company; (iv) do not, as of the date hereof,
violate any material contractual or legal restriction binding on or affecting
any Company contained in any document, order, writ, judgment, award, injunction
or decree applicable to such Company. 
The Loan Documents have been duly executed and delivered on behalf of
each Company that is a party thereto.

3.             No authorization, approval or other
action by, and no notice to or filing with, any Governmental Authority or
regulatory body is required for the due execution, delivery and performance by
any Company of any Loan Document to which it is a party.

4.             There is no pending or, to the best
of my knowledge, threatened action or proceeding against any Company before any
court, governmental agency or arbitrator which is likely to have a materially
adverse effect upon the financial condition or operations of the Companies,
taken as whole, or that purports to affect the legality, validity or
enforceability of any Loan Document.

This opinion is limited solely to matters of law of
the Delaware Limited Liability Company Act, the General Corporation Law of the
State of Delaware and the General Corporation Law of the State of Utah, as
those laws are in effect as of the date hereof, and I express no opinion as to
the laws of any other jurisdiction, including but not limited to, ordinances,
regulations or practices of any county, city or other government agency or body
within any state.

I am aware that Sidley Austin LLP will rely upon the
statements in paragraphs 1, 2, 3 and 4 of this opinion in rendering their
opinion furnished pursuant to Section 4.01(b)(i) of the Credit Agreement.

This opinion is limited to the matters expressly set
forth herein, and no opinion is implied or may be inferred beyond the matters
expressly set forth herein.  The opinions
expressed herein are being delivered to you as of the date hereof in connection
with the transactions described hereinabove and are solely for your benefit in
connection with the transactions described hereinabove and may not be relied on
in any manner or for any purpose by any other person, nor any copies published,
communicated or otherwise made available in whole or in 

 4
 

 

part to any other person
or entity without my specific prior written consent, except that you may
furnish copies thereof (i) to any of your permitted successors and assigns in
respect of the Loan Documents, although any such assignee may rely on this
opinion only to the extent it would have been able to rely hereon if it were a
party to such Loan Documents on the date hereof, (ii) to your independent
auditors and attorneys, (iii) upon the request of any state or federal
authority or official having regulatory jurisdiction over you, and (iv)
pursuant to order or legal process of any court or governmental agency.

This opinion speaks solely as of the date hereof and I
disclaim any obligation or undertaking to advise you of any changes which may
occur after the date hereof.

	
  Very truly yours,

  
	
   

  
	
   

  
	
  Jay P. Wertheim

  
	
  Vice President,
  Associate

  
	
  General Counsel
  and Secretary

  

 

 5Ex-10.35

 

 

 

 

 

STOCK
PURCHASE AGREEMENT

among

BUCA,
INC.,

BUCA
RESTAURANTS 3, INC.,

BERTUCCI’S
CORPORATION

and

VINNY T’S
ACQUISITION CORPORATION

Dated as
of September 25, 2006

 

 

TABLE OF
CONTENTS

	
  ARTICLE I

  	
   

  	
  Purchase and Sale of Shares; Closing

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section
  1.1

  	
   

  	
  Purchase and Sale of Shares.

  	
   

  	
  1

  
	
  Section
  1.2

  	
   

  	
  Closing.

  	
   

  	
  2

  
	
  Section
  1.3

  	
   

  	
  Closing Obligations.

  	
   

  	
  2

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
   

  	
  Post-Closing Purchase Price Adjustment

  	
   

  	
  4

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section
  2.1

  	
   

  	
  Working Capital Adjustment.

  	
   

  	
  4

  
	
  Section
  2.2

  	
   

  	
  Adjustment Payment.

  	
   

  	
  5

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  	
  Representations and Warranties of the Company
  and Seller

  	
   

  	
  6

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section
  3.1

  	
   

  	
  Organization and Authority of Seller; No
  Conflicts.

  	
   

  	
  6

  
	
  Section
  3.2

  	
   

  	
  Organization, Authority and Qualification of the
  Company; No Conflicts.

  	
   

  	
  6

  
	
  Section
  3.3

  	
   

  	
  Capitalization of the Company.

  	
   

  	
  7

  
	
  Section
  3.4

  	
   

  	
  Stock Ownership.

  	
   

  	
  8

  
	
  Section
  3.5

  	
   

  	
  Financial Statements.

  	
   

  	
  9

  
	
  Section
  3.6

  	
   

  	
  Absence of Undisclosed Liabilities; Absence of
  Certain Changes or Events.

  	
   

  	
  9

  
	
  Section
  3.7

  	
   

  	
  Title to Assets; Real Properties; Leases;
  Absence of Liens and Encumbrances; Etc.

  	
   

  	
  10

  
	
  Section
  3.8

  	
   

  	
  Litigation.

  	
   

  	
  12

  
	
  Section
  3.9

  	
   

  	
  Compliance with Law/Government Authorizations.

  	
   

  	
  12

  
	
  Section
  3.10

  	
   

  	
  Contracts.

  	
   

  	
  13

  
	
  Section
  3.11

  	
   

  	
  Consents and Approvals.

  	
   

  	
  15

  
	
  Section
  3.12

  	
   

  	
  Tax Matters.

  	
   

  	
  16

  
	
  Section
  3.13

  	
   

  	
  Intellectual Property.

  	
   

  	
  17

  
	
  Section
  3.14

  	
   

  	
  Conduct of Business; Absence of Certain Changes.

  	
   

  	
  18

  
	
  Section
  3.15

  	
   

  	
  Employee Matters and Benefits.

  	
   

  	
  21

  
	
  Section
  3.16

  	
   

  	
  Environmental Matters.

  	
   

  	
  24

  
	
  Section
  3.17

  	
   

  	
  Insurance.

  	
   

  	
  25

  
	
  Section 3.18

  	
   

  	
  Prepaid Amounts.

  	
   

  	
  25

  
	
  Section 3.19

  	
   

  	
  Suppliers.

  	
   

  	
  26

  
	
  Section 3.20

  	
   

  	
  Capital Expenditures.

  	
   

  	
  26

  
	
  Section
  3.21

  	
   

  	
  Brokers and Finders.

  	
   

  	
  26

  
	
  Section
  3.22

  	
   

  	
  Corporate Books, Records and Accounts.

  	
   

  	
  26

  
	
  Section
  3.23

  	
   

  	
  Borrowings and Guarantees.

  	
   

  	
  27

  
	
  Section
  3.24

  	
   

  	
  Directors and Officers; Financial Service
  Relations and Powers of Attorney.

  	
   

  	
  27

  
	
  Section
  3.25

  	
   

  	
  Absence of Sensitive Payments.

  	
   

  	
  27

  
	
  Section
  3.26

  	
   

  	
  No Other Representations or Warranties.

  	
   

  	
  28

  

 

 i
 

 

 

	
  ARTICLE IV

  	
   

  	
  Representations and Warranties of Buyer and
  Parent

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section
  4.1

  	
   

  	
  Organization and Authority of Buyer; No
  Conflicts.

  	
   

  	
  28

  
	
  Section
  4.2

  	
   

  	
  Organization and Authority of Parent; No
  Conflicts.

  	
   

  	
  29

  
	
  Section
  4.3

  	
   

  	
  Brokers and Finders.

  	
   

  	
  29

  
	
  Section
  4.4

  	
   

  	
  Parent Financial Statements.

  	
   

  	
  30

  
	
  Section
  4.5

  	
   

  	
  Conduct of Parent Business; Absence of Certain
  Parent Changes.

  	
   

  	
  30

  
	
  Section
  4.6

  	
   

  	
  Financial Capability.

  	
   

  	
  30

  
	
  Section
  4.7

  	
   

  	
  Investment Intent and Experience; Share Resale
  Restrictions.

  	
   

  	
  31

  
	
  Section
  4.8

  	
   

  	
  Consents and Approvals.

  	
   

  	
  31

  
	
  Section
  4.9

  	
   

  	
  No Other Representations or Warranties.

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
   

  	
  Tax Matters

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section
  5.1

  	
   

  	
  Liability for Taxes and Related Matters.

  	
   

  	
  31

  
	
  Section
  5.2

  	
   

  	
  Transfer Taxes.

  	
   

  	
  33

  
	
  Section
  5.3

  	
   

  	
  Information to be Provided by Buyer.

  	
   

  	
  34

  
	
  Section
  5.4

  	
   

  	
  Assistance and Cooperation.

  	
   

  	
  34

  
	
  Section
  5.5

  	
   

  	
  Tax Sharing Agreements.

  	
   

  	
  35

  
	
  Section
  5.6

  	
   

  	
  Other Elections and Changes.

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
   

  	
  Certain Covenants and Agreements

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section
  6.1

  	
   

  	
  Retention of Books and Records.

  	
   

  	
  35

  
	
  Section
  6.2

  	
   

  	
  Closing Date Financial Statements.

  	
   

  	
  35

  
	
  Section
  6.3

  	
   

  	
  Change of Company Name.

  	
   

  	
  36

  
	
  Section
  6.4

  	
   

  	
  Landlord Estoppel Certificates.

  	
   

  	
  36

  
	
  Section
  6.5

  	
   

  	
  Employee Benefits.

  	
   

  	
  36

  
	
  Section
  6.6

  	
   

  	
  Litigation.

  	
   

  	
  37

  
	
  Section
  6.7

  	
   

  	
  Licenses.

  	
   

  	
  38

  
	
  Section
  6.8

  	
   

  	
  Further Assurances.

  	
   

  	
  38

  
	
  Section
  6.9

  	
   

  	
  Maintenance of Government Authorizations.

  	
   

  	
  38

  
	
  Section
  6.10

  	
   

  	
  No Hire; Non-Solicitation.

  	
   

  	
  38

  
	
  Section
  6.11

  	
   

  	
  Seekonk/Shrewsbury Lease.

  	
   

  	
  39

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII [INTENTIONALLY OMITTED]

  	
   

  	
  39

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII [INTENTIONALLY OMITTED]

  	
   

  	
  39

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
   

  	
  Survival And Indemnification

  	
   

  	
  39

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section
  9.1

  	
   

  	
  Survival of Representations, Warranties,
  Covenants and Agreements; Certain Limitations.

  	
   

  	
  39

  
	
  Section
  9.2

  	
   

  	
  Indemnification by Buyer and Parent.

  	
   

  	
  40

  
	
  Section
  9.3

  	
   

  	
  Indemnification by Seller.

  	
   

  	
  41

  
	
  Section
  9.4

  	
   

  	
  Indemnification as Sole Remedy.

  	
   

  	
  41

  

 

 ii
 

 

 

	
  Section 9.5

  	
   

  	
  Method of Asserting Claims, Etc.

  	
   

  	
  41

  
	
  Section
  9.6

  	
   

  	
  Exceptions.

  	
   

  	
  43

  
	
  Section
  9.7

  	
   

  	
  Effect of Purchase Price Adjustment.

  	
   

  	
  43

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
   

  	
  Definitions

  	
   

  	
  43

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section
  10.1

  	
   

  	
  Specific Definitions.

  	
   

  	
  43

  
	
  Section
  10.2

  	
   

  	
  Other Terms.

  	
   

  	
  49

  
	
  Section
  10.3

  	
   

  	
  Other Definitional Provisions.

  	
   

  	
  49

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XI

  	
   

  	
  Miscellaneous

  	
   

  	
  49

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section
  11.1

  	
   

  	
  Amendment and Waiver.

  	
   

  	
  49

  
	
  Section
  11.2

  	
   

  	
  Expenses.

  	
   

  	
  50

  
	
  Section
  11.3

  	
   

  	
  Confidentiality.

  	
   

  	
  50

  
	
  Section
  11.4

  	
   

  	
  Public Disclosure.

  	
   

  	
  50

  
	
  Section
  11.5

  	
   

  	
  Assignment.

  	
   

  	
  51

  
	
  Section
  11.6

  	
   

  	
  Entire Agreement.

  	
   

  	
  51

  
	
  Section
  11.7

  	
   

  	
  Fulfillment of Obligations.

  	
   

  	
  51

  
	
  Section
  11.8

  	
   

  	
  Parties in Interest; No Third Party
  Beneficiaries.

  	
   

  	
  51

  
	
  Section
  11.9

  	
   

  	
  Schedules.

  	
   

  	
  51

  
	
  Section
  11.10

  	
   

  	
  Interpretation.

  	
   

  	
  51

  
	
  Section
  11.11

  	
   

  	
  Counterparts.

  	
   

  	
  52

  
	
  Section
  11.12

  	
   

  	
  Section Headings.

  	
   

  	
  52

  
	
  Section
  11.13

  	
   

  	
  Notices.

  	
   

  	
  52

  
	
  Section
  11.14

  	
   

  	
  Governing Law.

  	
   

  	
  53

  
	
  Section
  11.15

  	
   

  	
  Severability.

  	
   

  	
  53

  

 

 iii
 

 

EXHIBITS

	
  Exhibit A

  	
   

  	
  Form of Promissory Note

  
	
  Exhibit B

  	
   

  	
  List of Permitted Encumbrances

  
	
  Exhibit C

  	
   

  	
  Company Releases

  
	
  Exhibit D

  	
   

  	
  Guaranty

  
	
  Exhibit E

  	
   

  	
  Transition Services Agreement

  
	
  Exhibit F

  	
   

  	
  Opinion of Faegre & Benson LLP

  
	
  Exhibit G

  	
   

  	
  Opinion of Brown Rudnick Berlack Israels LLP

  

 

 iv

 

 

This
Stock Purchase Agreement is dated as of September 25, 2006, by and among BUCA,
Inc., a Minnesota corporation (“Seller”), BUCA Restaurants 3, Inc., a Minnesota
corporation (the “Company”), Bertucci’s Corporation, a Delaware corporation
(the “Parent”), and Vinny T’s Acquisition Corporation, a Delaware corporation
(the “Buyer”).

W I T N E S S E T
H:

WHEREAS,
the Company is engaged in the business of owning and operating a chain of
restaurants doing business under the name “Vinny T’s” (the “Business”);

WHEREAS,
Seller owns all of the issued and outstanding shares of capital stock of the
Company;

WHEREAS,
Seller desires to sell and transfer to Buyer, and Buyer desires to purchase
from Seller, all of the issued and outstanding shares of capital stock of the Company,
as more specifically provided herein; and

NOW,
THEREFORE, in consideration of the mutual covenants and agreements contained
herein, and subject to and on the terms and conditions herein set forth, the
parties hereto agree as follows (certain capitalized terms used in this
Agreement are defined in Article X hereof):

ARTICLE I

Purchase
and Sale of Shares; Closing

Section 1.1            Purchase
and Sale of Shares.

(a)           Subject to the terms and conditions
of this Agreement, Buyer agrees to purchase from Seller, and Seller agrees to
sell to Buyer, all of the issued and outstanding shares (the “Shares”) of
common stock, $.01 par value per share, of the Company for an aggregate
purchase price of $6,800,000.00 (the “Purchase Price”), subject to adjustment
as provided in Article II below.

(b)           The Purchase Price shall be paid by
the Buyer to the Seller as follows:

(i)                                  The
Buyer shall pay the Seller $3,000,000.00 of the Purchase Price by wire transfer
of immediately available funds on the Closing Date to an account designated by
the Seller (the “Cash Payment”); and

(ii)                               At
the Closing, the Buyer shall deliver to the Seller a promissory note, in the
form attached hereto as Exhibit A
(the “Promissory Note”), in the original principal amount of $3,800,000.00, provided
however, that the amounts due under the Promissory Note may be increased
and/or reduced (as applicable) pursuant to the provisions of Section 2.2 and
Section 9.3(b) below. 

 1
 

 

 

Section 1.2            Closing.

The
delivery of the Shares and payment therefore (the “Closing”) will take place at
the offices of Brown Rudnick Berlack Israels LLP, One Financial Center, Boston, MA,
02111 at 10:00 a.m. local time, on September 25, 2006, or at such other time
and place as the parties hereto may mutually agree, provided however,
that if: (1) on the Closing Date (as defined below) the Shares are in the
possession of Wells Fargo Foothill, Inc. (the “WFF”) pursuant to that certain
Credit Agreement, dated as of November 15, 2004, by and among the Seller and
each of its subsidiaries that are signatories thereto, the Lenders that are
signatories thereto, and WFF, as the Arranger and the Administrative Agent, as
amended (the “BUCA Credit Agreement”); and (2) WFF has agreed in writing to
deliver the certificate(s) evidencing the Shares and all stock powers that it
has possession of relating to such Shares to the Buyer within three Business
Days (as defined in the BUCA Credit Agreement) of the Buyer’s delivery of the
Cash Payment to the Seller, then the certificates evidencing the Shares may be
delivered to the Buyer promptly after the Closing.  The date on which the Closing occurs is
called the “Closing Date.”

Section 1.3            Closing
Obligations.

At the Closing:

(a)           Seller will deliver to Buyer (i)
certificates representing the Shares, duly endorsed (or accompanied by duly
executed stock powers), for transfer to Buyer (except as provided in Section
1.2 above), and (ii) such other documents as may be required to effect a valid
transfer of the Shares by Seller, free and clear of any and all Encumbrances
(except as set forth on Exhibit B
attached hereto) including, without limitation, those arising under Article 8
of the Uniform Commercial Code of the State of Minnesota.  Such documents shall be in form and substance
satisfactory to counsel for Buyer.

(b)           Each of Seller and Company will
deliver to Buyer an officer’s certificate in form and substance reasonably
satisfactory to Buyer which certificates certify that: (i) each of the
representations and warranties of Seller or Company, as applicable, contained
in this Agreement are true and correct in all respects as of the Closing Date;
(ii) each of the covenants and agreements of Seller or Company, as applicable,
in the Agreement to be performed on or prior to the Closing Date have been duly
performed in all respects or waived by Buyer or Parent.

(c)           Each of Seller and Company will
deliver to Buyer duly executed certificates of their respective Secretaries in
form and substance reasonably satisfactory to Buyer certifying (A) resolutions
of their respective directors approving this Agreement, the Ancillary
Agreements (as defined below) to which they are a party and the transactions
contemplated hereby and thereby (together with incumbency and signature
certificates regarding the officers signing on behalf of Seller and the
Company) and (B) the articles of incorporation and by-laws of Seller and the
Company.

 2
 

 

 

(d)           Seller will deliver to Buyer evidence
in form and substance reasonably satisfactory to Buyer of the release of all
Encumbrances (except as set forth on Exhibit B
attached hereto): (i) on the Shares (other than federal and state securities
law restrictions); and (ii) on all of the owned assets and properties of the
Company, all effective on or before the Closing Date.

(e)           Seller will deliver to Buyer: (i)
copies of all consents, approvals and estoppel certificates set forth on Schedule
1.3(e)(i) of the Disclosure Schedules; and (ii) all documentation requested
by Buyer transferring to Buyer the Governmental Authorizations issued by
Governmental Entities in connection with the Business set forth on Schedule
1.3(e)(ii) of the Disclosure Schedules.

(f)            Seller will deliver to Buyer
documents evidencing termination of all agreements between Seller and the
Company, except for the Transition Services Agreement (as defined below).

(g)           The Company will deliver to Buyer
resignations of all officers and directors of the Company, effective as of the
Closing Date.

(h)           The Company will deliver to Buyer
general releases in the forms attached hereto as Exhibit C
(the “Company Releases”) from Seller and all officers, directors and
stockholders of the Company of any liability of the Company to them, or any
claim which they may have against the Company. 

(i)            The Company will deliver to Buyer a
certificate or certificates representing all shares of capital stock of Dedham
K&L, Inc., a Massachusetts corporation (“Dedham K&L”), owned of record
or beneficially by the Company.

(j)            The Company will deliver to Buyer
resignations of Richard Erstad from the board of directors of Dedham K&L
and Richard Erstad as Treasurer of Dedham K&L, all effective as of the
Closing Date.

(k)           Buyer will pay to Seller the Cash
Payment as required by Section 1.1(b)(i).

(l)            Buyer will deliver to Seller the
duly executed Promissory Note.

(m)          Parent will deliver to Seller a
Guaranty of Buyer’s payments under the Promissory Note, and Buyer’s other
obligations under this Agreement, in the form attached hereto as Exhibit D (the “Guaranty”).

(n)           Each of Buyer and Parent will deliver
to Seller an officer’s certificate in form and substance reasonably
satisfactory to Seller which certificates certify that: (i) each of the
representations and warranties of Buyer or Parent, as applicable, contained in
this Agreement are true and correct in all respects as of the Closing Date;
(ii) each of the covenants and agreements 

 3
 

 

 

of Buyer or Parent, as applicable, in the Agreement to
be performed on or prior to the Closing Date have been duly performed in all
respects or waived by Seller.

(o)           Each of Buyer and Parent will deliver
to Seller duly executed certificates of their respective Secretaries or
Assistant Secretaries in form and substance reasonably satisfactory to Seller
certifying (A) resolutions of their respective directors approving this
Agreement, the Ancillary Agreements (as defined below) to which they are a
party and the transactions contemplated hereby and thereby (together with
incumbency and signature certificates regarding the officers signing on behalf
of Buyer and Parent), and (B) the certificates of incorporation and by-laws of
Buyer and Parent.

(p)           Seller and the Company will deliver
to each other a duly executed transition services agreement in the form
attached hereto as Exhibit E
(the “Transition Services Agreement”).

(q)           Faegre
& Benson LLP, counsel to Seller and the Company, will deliver an opinion to
Buyer and Parent, dated as of the Closing Date, in the form attached hereto as Exhibit F.

(r)            Brown
Rudnick Berlack Israels LLP,
counsel to Buyer and Parent, will deliver an opinion to Seller, dated as of the
Closing Date, in the form attached hereto as Exhibit G.

ARTICLE
II

Post-Closing
Purchase Price Adjustment

Section 2.1        Working Capital
Adjustment.

(a)        Seller and Buyer
acknowledge and agree that the consideration to be paid by Buyer hereunder is
to be established in part by reference to:

(i)     the
non-cash current assets of the Company, equal to the current assets of the
Company minus the cash of the Company, each determined in accordance with GAAP
(the “Non-Cash Current Assets”), existing at the close of business on the
Closing Date; and

(ii)    the
current liabilities of the Company, determined in accordance with GAAP (“Current
Liabilities”), existing at the close of business on the Closing Date.

(b)        Within 90 days after the
Closing Date, Buyer will furnish to Seller: (i) a report (the “Preliminary
Report”) stating the Non-Cash Current Assets and the Current Liabilities
as of the Closing Date; and (ii) applicable supporting documentation for the
Preliminary Report.  Unless Seller gives
written notice to Buyer of a good faith objection to a material aspect of the
Preliminary Report before the close of business on the 30th day after
Seller’s receipt thereof, the Preliminary Report will then become binding upon
Seller and Buyer and will be the “Final Report” and such 

 4
 

 

 

30th day will be the “Final Report Date.”  If Seller (by written notice to Buyer and
Parent before the close of business on such 30th day) objects in good faith to
any material aspect of the Preliminary Report, then only those aspects as to
which the good faith objection was made will not become binding.  Seller and Buyer will discuss any such
objection(s) and, if they reach written agreement amending the Preliminary
Report, then the Preliminary Report, as amended by such written agreement, will
become binding and will become the Final Report and the date of such written
agreement will be the Final Report Date. 
If Seller and Buyer do not reach written agreement within 30 days after
Seller gives such notice of objection(s), then the matter(s) objected to (and
only such matter(s)) will be submitted to PricewaterhouseCoopers, LLP (the “CPA”),
certified public accountants (whose fees will be divided equally between Seller
and Buyer), who will resolve the dispute by delivery of a written statement of
such resolution to Buyer and Seller within 60 days after submission of the
dispute to the CPA, which statement, when delivered to Seller and Buyer, will
become binding on Seller and Buyer.  Such
statement (combined with those aspects of the Preliminary Report as to which
Seller did not provide notice of objection) will be the Final Report and the
date on which the CPA submits such statement to Seller and Buyer will be the
Final Report Date.

Section 2.2        Adjustment
Payment.

(a)        The amount equal to the
Non-Cash Current Assets minus the Current Liabilities (each as of the
Closing Date and as stated in the Final Report) is hereby defined as “Net
Working Capital.”  If Net Working Capital
is more than $(1,074,400), (the “Maximum Net Working Capital”), then the principal amount due under the Promissory Note
shall be increased by Net Working Capital minus the Maximum Net Working
Capital.  If Net Working Capital is less
than $(1,174,400), (the “Minimum Net Working Capital”), then
the principal amount due under the Promissory Note shall be reduced by the
Minimum Net Working Capital minus Net Working Capital.

(b)        In the event of a
required increase in the principal amount of the Promissory Note under Section
2.2(a), Buyer and Seller covenant and agree to execute an amendment to the
Promissory Note within 10 days following the Final Report Date which
effectuates such required increase, with interest accruing on the amount of
such increase in the principal amount of the Promissory Note from the Closing
Date, and such amendment to be reasonably satisfactory in form and substance to
the Buyer and the Seller.  In the event
of a required decrease in the principal amount of the Promissory Note under
Section 2.2(a), Buyer and Seller covenant and agree to execute an amendment to
the Promissory Note within 10 days following the Final Report Date which
effectuates such required decrease, such amendment to reflect that no interest
shall accrue (or shall have ever accrued) on the amount obtained by subtracting
the Net Working Capital from the Minimum Net Working Capital, and such
amendment to be reasonably satisfactory in form and substance to Buyer and the
Seller.

 5
 

 

 

ARTICLE III

Representations and Warranties of the Company and
Seller

Except
as otherwise set forth in the disclosure schedules attached hereto (the “Disclosure
Schedules”), the Company (except with respect to Section 3.1) and Seller,
jointly and severally, represent and warrant to Buyer and Parent as follows:

Section 3.1            Organization
and Authority of Seller; No Conflicts.

Seller is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Minnesota, has all requisite corporate power and authority
to own, operate and lease its properties and to conduct its business in the
manner and in the places where such properties are owned or leased or such
business is conducted by it.  Seller has
taken all corporate action necessary in order to execute, deliver and perform
its obligations under this Agreement and the certificates, documents and
agreements contemplated by this Agreement (the “Ancillary Agreements”) to which
it is a party.  This Agreement and the
Ancillary Agreements to which it is a party are legal, valid and binding
obligations of Seller, enforceable in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors’
rights and to general equity principles (the “Enforcement Exceptions”). The
execution, delivery and performance of this Agreement and the Ancillary
Agreements to which it is a party by Seller do not, and the consummation by
Seller of the transactions contemplated hereby and thereby will not, constitute
or result in: (a) a breach or violation of, or a default or required notice
under, the articles of incorporation or by-laws of Seller, (b) a breach or
violation of, or a default under, the acceleration of any obligations,
termination, cancellation, or the creation of an Encumbrance on the assets of
Seller (with or without notice, lapse of time or both) or required notice
pursuant to any agreement (whether written or oral), understanding, commitment,
lease, contract, note, mortgage, indenture, arrangement or other obligation (“Contracts”)
binding upon Seller, (c) a violation of any foreign, federal, state or local
law, rule, regulation, Court Order or other restriction of any court or
Governmental Entity (“Law”) or any Governmental Authorization or
non-governmental permit or license to which Seller is subject, (d) any change
in the rights or obligations of any party under any of the Contracts to which
the Seller is a party, or (e) result in the creation or imposition of any
Encumbrance upon any of the assets of the Seller or upon the Shares (except as
set forth on Exhibit B attached hereto).

Section 3.2            Organization,
Authority and Qualification of the Company; No Conflicts.

The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Minnesota, has the
corporate power and authority to own, operate and lease its assets and to carry
on its business substantially as it is now being conducted, and is duly
qualified as a foreign corporation to do business, and is in good standing, in
each jurisdiction where the ownership or operation of its properties and assets
or the conduct of its 

 6
 

 

 

business requires such qualification, except where the
failure to be so qualified (in the aggregate) would not have a Material Adverse
Effect, and has all requisite corporate power and authority, and has taken all
corporate action necessary in order, to execute, deliver and perform its
obligations under this Agreement and the Ancillary Agreements to which it is a
party.  This Agreement and the Ancillary
Agreements to which it is a party are legal, valid and binding obligations of
the Company, enforceable in accordance with its terms, subject to the
Enforcement Exceptions. The execution, delivery and performance of this
Agreement and the Ancillary Agreements to which it is a party by the Company do
not, and the consummation by the Company of the transactions contemplated
hereby and thereby will not, constitute or result in: (a) a breach or violation
of, or a default or required notice under, the articles of incorporation or
by-laws of the Company, (b) a breach or violation of, or a default under, the
acceleration of any obligations, termination, cancellation, or the creation of
an Encumbrance on the assets of the Business (with or without notice, lapse of
time or both), or required notice pursuant to any Contracts binding upon the
Company, (c) a violation of any Law or Governmental Authorization or
non-governmental permit or license to which the Company is subject, (d) any
change in the rights or obligations of any party under any of the Contracts to
which the Company is a party, or (e) result in the creation or imposition of
any Encumbrance upon any of the Company’s assets or the Shares (except as set
forth on Exhibit B attached hereto).

Section 3.3            Capitalization
of the Company.

The
authorized capital stock of the Company consists of 1,000 shares of common
stock, $.01 par value per share, of which 100 shares (constituting the Shares)
are issued and outstanding.  The Shares
have been duly authorized and validly issued, are fully paid and nonassessable
and are owned of record and beneficially solely by Seller free and clear of any
lien, pledge, security interest, claim or other encumbrances (collectively, “Encumbrances”),
under Article 8 of the Uniform Commercial Code of the State of Minnesota or
otherwise, other than restrictions under federal and state securities
laws.  The Shares were issued in
compliance with applicable federal and state securities laws, and were not
issued in violation of any Person’s preemptive rights.  There are no shares of the Company’s capital
stock reserved for any purpose.  There
are no preemptive or other outstanding rights, options, warrants, conversion
rights, stock appreciation rights, “phantom” stock, redemption rights,
agreements, arrangements or commitments to issue or sell any shares of capital
stock or other securities of the Company or any securities or obligations
convertible or exchangeable into or exercisable for, or giving any Person a
right to subscribe for or acquire, any securities of the Company, and no
securities or obligations evidencing such rights are authorized, issued or
outstanding.  The Company does not have
outstanding any bonds, debentures, notes or other obligations the holders of
which have the right to vote (or convertible into or exercisable for securities
having the right to vote) on any matter. 
There are no agreements relating to the voting of the Company’s capital
stock, or restrictions on the transferability of the Company’s capital stock
(by agreement, certificate of incorporation, bylaws, statute or otherwise),
except pursuant to federal and state securities laws.  There are no agreements among the Company,
Seller and/or any other Person relating to the Company’s capital stock.  When the Shares are delivered to Buyer at the
Closing pursuant to this Agreement, the Shares will be duly authorized, validly
issued, fully paid and nonassessable, and 

 7
 

 

 

will be free and clear of all Encumbrances, under
Article 8 of the Uniform Commercial Code of the State of Minnesota or
otherwise, other than restrictions on transfer pursuant to federal and state
securities laws. 

Section 3.4            Stock
Ownership.

Except
for owning a 25% equity interest in Dedham K&L (represented by 2,500 shares
of Common Stock, no par value) (the “Dedham Shares”), the Company does not own,
directly or indirectly, an equity or other ownership interest in any
Person.  To the Knowledge of the Company
and the Seller, Schedule 3.4 of the Disclosure Schedules sets forth all
of the record owners of Dedham K&L securities and the number and nature of
the Dedham K&L securities that they own. 
To the Knowledge of the Company and the Seller, the Dedham Shares have
been duly authorized and validly issued, are fully paid and nonassessable and
are owned of record and beneficially solely by the Company free and clear of
any Encumbrances, under Article 8 of the Uniform Commercial Code of the
Commonwealth of Massachusetts or otherwise, other than restrictions under
federal and state securities laws.  To
the Knowledge of the Company and the Seller, the Dedham Shares were issued in
compliance with applicable federal and state securities laws, and were not
issued in violation of any Person’s preemptive rights.  To the Knowledge of the Company and the
Seller, neither Dedham K&L nor any of its officers, directors,
stockholders, employees or representatives have any claims of any nature
against Dedham K&L, any of the officers of Dedham K&L, any of the
directors of Dedham K&L, any of the stockholders of Dedham K&L, the
Company, the Seller or the officers, directors, employees or representatives of
the Seller or the Company.  To the
Knowledge of the Company and the Seller, there are no shares of Dedham K&L’s
capital stock reserved for any purpose. 
To the Knowledge of the Company and the Seller, there are no preemptive
or other outstanding rights, options, warrants, conversion rights, stock
appreciation rights, “phantom” stock, redemption rights, agreements,
arrangements or commitments to issue or sell any shares of capital stock or
other securities of Dedham K&L or any securities or obligations convertible
or exchangeable into or exercisable for, or giving any Person a right to
subscribe for or acquire, any securities of Dedham K&L, and no securities
or obligations evidencing such rights are authorized, issued or
outstanding.  Except as set forth on Schedule
3.4 of the Disclosure Schedules, to the Knowledge of the Company and the
Seller, there are no agreements relating to the voting of Dedham K&L’s
capital stock, or restrictions on the transferability of Dedham K&L’s
capital stock (by agreement, certificate of incorporation, bylaws, statute or
otherwise), except pursuant to federal and state securities laws.  There are no agreements between the Company
and any other Person relating to Dedham K&L’s capital stock.  Other than that certain Innholder License to
Expose, Keep for Sale and to Sell All Kinds of Alcoholic Beverages to be Drunk
on the Premises (License #134) issued by The Licensing Board of the Town of
Dedham to Dedham K&L, that
certain Beverage Concession Agreement dated January 14, 2002 by and between
Dedham K&L and the Company, and that certain Stockholders Agreement dated
as of January 14, 2002 by and among Dedham K&L and the Stockholders (as
defined therein), Dedham K&L does not own any other asset or property used
or necessary for the operation of the Business.

 8
 

 

 

 Section 3.5           Financial Statements.

Attached
hereto as Schedule 3.5 of the Disclosure Schedules are copies of: (a)
the Company’s income statements for each of the fiscal years ended December 26,
2004 and December 25, 2005, excluding however, allocations of expenses
incurred by Seller attributable to Company and corporate overhead recorded on
the financial statements of Seller for the applicable periods (collectively,
the “2004/2005 Statements”); (b) the Company’s income statement for the period
of December 26, 2005 through August 20, 2006, excluding however,
allocations of expenses incurred by Seller attributable to Company and
corporate overhead recorded on the financial statements of Seller for the
applicable period (the “2006 Statement”); and (c) the Company’s balance sheet
as August 20, 2006 (the “Balance Sheet” and together with the 2004/2005
Statements and the 2006 Statement, the “Financial Statements”).  August 20, 2006 is referred to herein as the “Balance
Sheet Date”.  The Financial Statements
have been prepared on a consistent basis throughout the periods involved and
prior periods (except that the 2006 Statement is subject to ordinary year-end
adjustments), are complete and correct in all material respects and present
fairly, in all material respects, the assets, liabilities and financial
position of the Company and the results of operations of the Company for the
periods covered by such Financial Statements. 
The Balance Sheet has been prepared in accordance with GAAP (except that
it lacks the footnotes required by GAAP and is subject to ordinary year-end
adjustments), is complete and correct in all material respects and presents
fairly, in all material respects, the assets, liabilities and financial
position of the Company as of the Balance Sheet Date.  The Financial Statements are consistent with
the books and records of the Company (which, in turn, are accurate and complete
in all material respects).

Section 3.6            Absence
of Undisclosed Liabilities; Absence of Certain Changes or Events.

(a)           There are no material Liabilities of
any nature, known or unknown, with respect to the Company or the Business,
whether accrued, absolute, contingent or otherwise (including, without
limitation, liabilities as guarantor or otherwise with respect to obligations
of others, or liabilities for Taxes due or then accrued or to become due),
except: (i) liabilities stated or adequately reserved against on the Balance
Sheet; (ii) liabilities, not in excess of $50,000.00, incurred since the
Balance Sheet Date in the ordinary course of business consistent with past
practices (none of which is a claim for breach of contract, breach of duty,
breach of warranty, tort, or infringement of an intellectual property right);
(iii) liabilities disclosed on Schedule 3.6 of the Disclosure Schedules;
and (iv) contractual obligations disclosed on Schedule 3.10 of the
Disclosure Schedules for which the Company is not in material breach.

(b)           Except as set forth on Schedule
3.6 of the Disclosure Schedules, since the Balance Sheet Date, the Company
has conducted its business only in, and has not engaged in any material
transaction other than according to, the ordinary and usual course of such
business consistent with past practice and there has not been: (i) any material
damage, destruction or other casualty loss with respect to any material asset
or property owned, leased or otherwise used by the Company not covered by
insurance; (ii) any declaration, setting aside or payment of any 

 9
 

 

 

dividend or other distribution in respect of the
capital stock of the Company; or (iii) any labor dispute, other than routine
matters which have not had a Material Adverse Effect.

Section 3.7            Title
to Assets; Real Properties; Leases; Absence of Liens and Encumbrances; Etc.

(a)           The
Company has good and marketable title to all of the assets reflected in the
Balance Sheet as owned by the Company or acquired thereafter, free and clear of
all Encumbrances, except as set forth on Schedule 3.7 of the Disclosure
Schedules, and such assets, together with any assets leased by the Company,
constitute all of the assets used or necessary to conduct the Business.  All of
the tangible assets necessary for the conduct of the Business have been
maintained in accordance with normal industry practice, and are in good
operating condition and repair (subject to normal wear and tear).

(b)           The Company does not own any real
property.  Schedule 3.7 of the
Disclosure Schedules hereto identifies all leases and subleases of real property
to which the Company is a party (the “Real Property Leases”), the street
address of the premises covered by each of the Real Property Leases, and the
identity of the lessor (collectively, the “Leased Real Property”).  Each of the Real Property Leases is valid,
binding and enforceable against the Company and, to the Knowledge of the Seller
and the Company, the other parties thereto, subject in each case to the
Enforcement Exceptions.  True, correct
and complete copies of each of the Real Property Leases have been delivered to
Buyer (including all amendments, extensions, and renewals, and all guaranties
and other agreements with respect thereto). 
Except as set forth on Schedule 3.7 of the Disclosure Schedules,
the Company has marketable, valid, binding and enforceable (subject to the
Enforcement Exceptions) leasehold interests in all of the Leased Real Property
free and clear of any Encumbrances, except for: (i) any Encumbrances for real
estate taxes, assessments and other governmental charges with respect to such
Leased Real Property not yet due and payable or due but not delinquent or being
contested in good faith by appropriate proceedings and as to which accruals are
reflected in the Balance Sheet in accordance with GAAP; (ii) any statutory
mechanics’, workmen’s, repairmen’s, warehousemen’s, carriers’ or other like
Encumbrances with respect to such Leased Real Property imposed by operation of
law arising in the ordinary and usual course of business consistent with past
practice for amounts which are not delinquent or in default or are being
contested in good faith by appropriate proceedings, and which would not,
individually or in the aggregate, have a Material Adverse Effect; (iii)
easements, rights of way or other similar matters of record title to real
property that do not materially affect the title to, or the use or value to the
Company of, such real property; and (iv) any Encumbrances on the fee title, the
payment or performance of which are not the responsibility of the Company as
tenant under the applicable Real Property Lease, provided such
Encumbrance does not materially impair the use, occupancy or value of the
property subject thereto.  The Company
has actual possession of the premises at the Leased Real Property, and each
such Leased Real Property is used in the Business.

(c)           Except as set forth on Schedule
3.7(c) of the Disclosure Schedules, there are no obligations of the Company
or its subsidiaries related to leasing commissions and other similar 

 10
 

 

 

fees related to any Leased Real Property.  Except as set forth on Schedule 3.7(c)
of the Disclosure Schedules, with respect to each of the Real Property Leases:
(i) such Real Property Lease is in full force and effect; (ii) the
transactions contemplated hereby do not require the consent of any other party
to such Real Property Lease, will not result in a breach of or default under
such Real Property Lease, or otherwise cause such Real Property Lease to cease
to be in full force and effect on identical terms following the Closing; (iii)
neither the Company nor, to the Company’s and Seller’s Knowledge, any other
party to a Real Property Lease is in material breach or default under such Real
Property Lease, and, to the Company’s and Seller’s Knowledge, no event has
occurred or circumstance exists which, with the delivery of notice, passage of
time or both, would constitute such a material breach or default or permit the
termination, modification or acceleration of rent under such Real Property
Lease; (iv) to the Company’s and Seller’s Knowledge, there are no material
disputes with respect to any Real Property Lease; (v) to the Company’s and
Seller’s Knowledge, no security deposit or portion thereof deposited with
respect to any Real Property Lease has been applied in respect of a breach or
default under such Real Property Lease which has not been redeposited in full;
(vi) there are no forbearance programs in effect with respect to any Real
Property Lease; (vii) the Company has not assigned, subleased, mortgaged,
deeded in trust or otherwise transferred or encumbered any Real Property Lease
or any interest therein; (viii) to the Company’s and Seller’s Knowledge, all
buildings, improvements and other property on the Leased Real Property have
received all approvals of Governmental Entities (including, without limitation,
certificates of occupancy, permits and licenses) required in connection with
the ownership or operation thereof and, to the Company’s and Seller’s
Knowledge, have been operated and maintained in all material respects in
accordance with applicable legal requirements and, to the Company’s and Seller’s
Knowledge, are not in violation of any applicable material Law or restrictions
or covenants of record and such buildings and improvements are in satisfactory
condition and repair for continued use in the ordinary course of business
consistent with past custom and practice, and neither the Company nor any of
its subsidiaries has received any written notice from any Governmental Entity
(A) requiring the Company or its subsidiaries to correct any condition with
respect to the Leased Real Property by reason of a violation of any Law or (B)
threatening or contemplating modification, cancellation or non-renewal of any
such approvals, certificates of occupancy, permits and licenses; (ix) to the
Company’s and Seller’s Knowledge, all facilities located on the parcel of real
property underlying each Real Property Lease are supplied with utilities and
other services necessary for the operation of such facilities; (x) the Company
and its subsidiaries have performed all obligations required to be performed by
them under any Real Property Lease of the Leased Real Property the failure to
perform which would constitute a material breach or default under the
applicable Real Property Lease; (xi) to the Company’s and Seller’s Knowledge,
no part of any improvement located on the Leased Real Property that is material
to its operation is dependent for its access, operation or utility on any land,
building or other improvements not included in the Leased Real Property or as to
which the Company or its subsidiaries do not have rights for such access,
operation or utility, and all of the Leased Real Property has sufficient access
to public roads; (xii) to the Company’s and Seller’s Knowledge, there does not
exist any actual or, threatened or contemplated condemnation or eminent domain
proceedings or similar event that affects any Leased Real Property or any
material part thereof; (xiii) none of the Company or its subsidiaries holds a
contractual right or obligation to purchase or acquire any 

 11
 

 

 

material real estate interest in any Leased Real
Property or any portion thereof or interest therein; and (xiv) the Leased Real
Property constitutes the only real property used in or related to the Business
of the Company.

Section 3.8            Litigation.

(a)           Except as set forth on Schedule
3.8 of the Disclosure Schedules, there are no claims, actions, suits,
proceedings or investigations pending or, to the Knowledge of Seller or the
Company, threatened against the Company or any of the assets of the Company or
the Business, or to which the Company or the assets of the Company or the
Business may be bound or affected, at law, in equity or otherwise, in, before,
or by, any court or Governmental Entity or authority which, individually or in
the aggregate, would be reasonably likely to have a Material Adverse Effect,
and to the Knowledge of Seller or the Company, there is no basis for any of the
foregoing.  None of the Company or its
assets or properties is subject to any Court Order that would have a Material
Adverse Effect.  The Company is not
engaged in any pending legal action to recover monies due it or for damages
sustained by it.

(b)           Except as set forth on Schedule
3.8 of the Disclosure Schedules, since January 1, 2005 neither the Company
nor the Seller has instituted, or threatened to institute, any material claims,
actions, suits, proceedings or investigations against any other party relating
to the Business of the Company or the assets of the Company or the Business.

Section 3.9            Compliance
with Law/Government Authorizations.

(a)           Schedule 3.9(a) of the Disclosure Schedules
contains a complete and accurate list of each Government Authorization that is
held by the Company or the Seller that relates to the Business or the assets of
the Company.  Each Government
Authorization listed or required to be listed on Schedule 3.9(a) of the
Disclosure Schedule is valid and in full force and effect.  The Government Authorizations listed on Schedule
3.9(a) of the Disclosure Schedules collectively constitute all of the
Government Authorizations necessary to permit the Company to lawfully conduct
and operate the Business in the manner currently conducted and to permit the
Company to own and use its assets in the manner in which it currently owns and
uses such assets, unless the failure to have any Governmental Authorizations,
individually or in the aggregate, does not and would not reasonably be likely
to have a Material Adverse Effect. 
Except as described on Schedule 3.9(a) of the Disclosure
Schedules, the Buyer shall have full benefit of the same.  No proceeding is pending or, to the Knowledge
of the Seller or the Company, threatened seeking the revocation, suspension or
limitation of any Government Authorization.

(b)           The Company and, to the Knowledge of
the Company and the Seller, Dedham K&L are in compliance in all material
respects with all applicable Laws, Court Orders and Governmental Authorizations
affecting the assets or properties owned or used by each of them, the Business
or the business or operations of each of the Company and Dedham K&L,
including, but not limited to, the laws and regulations of the United States
Food and Drug Administration, the Federal Trade Commission, state and local
alcohol beverage control laws and regulations, and state and local health and
safety laws and regulations except for any noncompliance which, 

 12
 

 

 

individually or in the aggregate, does not and would
not be reasonably likely to have a Material Adverse Effect.  Since January 1, 2005, neither the Company
nor, to the Knowledge of the Company and the Seller, Dedham K&L has
received notice of, has been charged with violating, or been notified of any
liability or potential responsibility under, or threatened with a charge of
violating, or liability or potential responsibility, or, to the Knowledge of
the Company and the Seller, are either of the Company or Dedham K&L under
investigation with respect to a possible violation of, or liability or
potential responsibility, under any such applicable Law, Court Order or
Governmental Authorization relating to any of its or their assets or properties
or any aspect of its or their business, except, in each case for such matters
which, individually and in the aggregate, do not, and would not be reasonably
likely to, have a Material Adverse Effect.  

Section 3.10         Contracts.

(a)           Schedule
3.10(a) of the Disclosure Schedules lists the following Contracts to which
the Company or the Seller (only with respect those Contracts of Seller that are
material to the Business) is a party on the date hereof:  

(i)                Contracts with Seller, any Affiliate of Seller
or the Company, or director or officer of the Company, Seller, or any Affiliate
of Seller;

(ii)             Contracts for the future purchase of, or
payment for, supplies, products or assets, or for the performance of services
by a third party, in excess of $50,000 in any individual case;

(iii)          Contracts to sell or supply, or pay for,
supplies, products or assets or to perform, or pay for, services to or for
third parties, in excess of $50,000 in any individual case;

(iv)         Contracts
providing for the purchase of all or substantially all of the Business’s
requirements of a particular product from a supplier;

(v)            Contracts material to
the assets of the Company or the Business containing a change of control
provision applicable to the transactions contemplated by this Agreement,
including, without limitation, any stock option plan, stock appreciation right
plan or stock purchase plan, any of the benefits of which will be increased, or
the vesting of benefits of which will be accelerated, by the occurrence of any
of the transactions contemplated by this Agreement or the value of any of the
benefits of which will be calculated on the basis of any of the transactions
contemplated by this Agreement;

(vi)         Contracts
which are material to the assets or Business of the Company;

 13
 

 

 

(vii)      Contracts
affecting any leasehold or other interest in any real property or personal
property requiring payments in excess of $50,000 to which the Company is a
party;

(viii)   Contracts for
capital expenditures by the Company or the Business in excess of $50,000;

(ix)           notes, debentures, bonds, conditional sale
agreements, equipment trust agreements, letter of credit agreements,
reimbursement agreements, loan agreements or other Contracts for the borrowing
or lending of money, agreements or arrangements for a line of credit or
guarantee, pledge or undertaking in any manner (including guarantees of lease
obligations) whatsoever of the indebtedness of any other Person;

(x)              Contracts limiting or restraining the Company
from engaging or competing, or from soliciting any Person, in any line of
business or any geographical area or with any Person;

(xi)           Contracts relating to any Intellectual Property
license or transfer of (A) Intellectual Property of the Company or the
Business, or (B) the Intellectual Property of any other party, which is either
exclusive or requires future payments of more than $50,000 per year, other than
the purchase of so-called “off-the-shelf” computer software;

(xii)        Collective bargaining agreements or other
Contracts with labor unions;

(xiii)     Contracts relating to employment, bonus,
severance arrangements, retirement benefits, deferred compensation or
termination of employment;

(xiv)    Contracts not made in the ordinary course of
business that individually involve the payment or receipt of more than $25,000;

(xv)       each joint venture, partnership, and other
Contract (however named) involving a sharing of profits, losses, costs, or
liabilities by the Company with any other Person;

(xvi)    each power of attorney that is currently
effective and outstanding;

(xvii) any
Contracts relating to any liquor licenses;

(xviii) Contracts to purchase, sell or dispose of any
restaurant leased or operated by the Company under which (x) the obligations
therein have not yet been fully satisfied, or (y) there are any outstanding Liabilities;

(xix)      Contracts with current or former employees,
agents, consultants or other Persons which limit or restrain such employees,
consultants or other Persons from competing with the Business or the Company or
from soliciting any of its current or former employees, agents or consultants;

 14
 

 

 

(xx)         Contracts
for a license or franchise, whether the Company or the Seller is the licensor,
franchisor, licensee or franchisee; or

(xxi)      Contracts with any Governmental Entity.

(b)           The Contracts set forth on Schedule
3.10(b) of the Disclosure Schedules were entered into for the benefit of
the Company even though they were signed in the names of entities that are no
longer in existence or have not been officially incorporated or otherwise
formed (the “D/B/A Contracts”) and the Company has the right to enforce the
D/B/A Contracts against the other parties thereto as if it were an original
signatory thereon.

(c)           Seller has delivered or made available
to Buyer a correct and complete copy of each Contract listed on Schedule
3.10(a) and Schedule 3.10(b) of the Disclosure Schedules, together with any
and all amendments or modifications thereto. 
Subject to such exceptions that, individually or in the aggregate, would
not be reasonably likely to have a Material Adverse Effect, each Contract
listed on Schedule 3.10(a) and Schedule 3.10(b) of the Disclosure
Schedules is valid, binding, enforceable (subject to the Enforcement
Exception), and in full force and effect, the Company and/or the Seller (as
applicable) is not, and to the Knowledge of Seller and the Company, the other
party/parties to any such Contract is/are not, in breach or default under any
such Contract and no event has occurred which, with notice or lapse of time or
both, would constitute a breach or default, or permit termination,
modification, or acceleration, under such Contract.  Since January 1, 2005, neither the Company
nor the Seller has given or received written notice, or to the Company’s or the
Seller’s Knowledge, oral notice, of any alleged breach or default that is
continuing under any such Contract. 
Except as set forth on Schedule 3.10(c) of the Disclosure
Schedules, neither the execution and delivery of this Agreement or the Ancillary
Agreements by the Seller or the Company nor the consummation or performance by
the Seller and the Company of the transactions contemplated hereby and thereby
will, directly or indirectly, with or without notice or lapse of time or both,
give rise to a right of termination, modification or acceleration under any
such Contract.  The Company and/or the
Seller (as applicable) has performed in all material respects all of its
obligations required to be performed by it under such Contracts.

(d)  Except as set forth on Schedule 3.10(d)
of the Disclosure Schedules, Seller is not a party to any Contract relating to
the Business.

Section 3.11         Consents
and Approvals.

Except
as set forth on Schedule 3.11 of the Disclosure Schedules, other than
the filings, notices, reports, consents, registrations, approvals, permits and
authorizations set forth on Schedule 3.7(c) and Schedule 3.11 of
the Disclosure Schedules, no notices, reports or other filings are required to
be made by Seller or the Company with, nor are any consents, registrations,
approvals, permits or authorizations required to be obtained by Seller or the 

 15
 

 

 

Company from any Person in connection with the
execution and delivery of this Agreement and the Ancillary Agreements by Seller
and the Company and the consummation by Seller and the Company of the
transactions contemplated hereby and thereby except those that the failure to
make or obtain are not, individually or in the aggregate, reasonably likely to
have a Material Adverse Effect or prevent, delay or impair the ability of
Seller to consummate the transactions contemplated by this Agreement.

Section 3.12         Tax
Matters.

Except as set
forth on Schedule 3.12 of the Disclosure Schedules: (a) all Tax Returns that are
required to be filed by or with respect to Seller’s Group and/or the Company
have been duly and timely filed, or, where not so filed, are covered under an
extension that has been obtained therefore, (b) Seller or the Company has
delivered or made available to Buyer correct and complete copies of all federal
and state income Tax Returns filed with respect to the Company for taxable
periods ended on or after December 28, 2003, (c) all Tax Returns filed by or
with respect to Seller’s Group and/or the Company are true, accurate and
complete, and have been prepared in compliance in all material respects with
all applicable Laws, (d) all Taxes due and payable by Seller’s Group and/or the
Company have been paid in full on a timely basis, except when the amount
thereof was being contested in good faith by appropriate proceedings and
adequate reserves therefor were set aside on the books of the Company, (e) none
of the Tax Returns referred to in this Section 3.12 has been examined by the
IRS or the appropriate state, local or foreign taxing authority, no deficiencies
or claims for Taxes (or adjustments relating to Taxes) have been claimed,
proposed or assessed in writing or otherwise by any Governmental Entity and
there are no pending or, to the Seller’s and Company’s Knowledge, threatened
audits, reviews, investigations or claims for or relating to any liability in
respect of Taxes of the Company for any taxable period, (f) no waivers of
statutes of limitation have been given by or requested with respect to any
Taxes of Seller’s Group or the Company, (g) the Company has withheld and timely
paid to the appropriate taxing authority the required amounts in material
compliance with all tax withholding provisions of applicable federal, state,
local and foreign Laws (including, without limitation, income, social security
and employment tax withholding), (h) there are no Encumbrances for Taxes upon
the assets or properties of the Company other than for Taxes not yet due and
payable and for which adequate reserves are reflected on the Balance Sheet; (i)
the Company has not made any payments, is not obligated to make any payments,
and is not a party to any agreement that could obligate it to make any payments
that would not be deductible, in whole or in part, under Section 280G or
Section 162(m) of the Code (or any corresponding provision of state, local or
foreign Tax law), (j) neither Seller nor the Company is a foreign person
subject to withholding under Section 1445 of the Code, (k) the Company neither
is nor ever was part of an affiliated group (within the meaning Section 1504(a)
of the Code) other than one in which Seller is the common parent; (l) the
Company has not failed to comply in any material respect with Section 409A of
the Code, (m) neither Seller nor the Company has consented to extend the time
in which any Taxes of the Company may be assessed or collected by any
Governmental Entity, which Taxes have not since been paid, or has requested or
been granted an extension of the time for filing any Tax Returns to a date
later than the Closing Date, which Tax Returns have not since been filed; (n)
the unpaid Taxes of the Company (i) did not, as 

 16
 

 

 

of the Balance Sheet Date, exceed the reserve for Tax
liability (rather than any reserve for deferred Taxes established to reflect
timing differences between book and Tax income) set forth on the Balance Sheet
(and not in any notes thereto), and (ii) will not exceed that reserve as
adjusted for the passage of time through the Closing Date in accordance with
the past custom and practice of the Company in filing Tax Returns; (o) other
than the affiliated group of which Seller is the common parent, the Company
does not have any liability for the Taxes of another person under Treas. Reg. §
1.1502-6 (or any similar provision of state, local, or foreign law), as a
transferee or successor, by contract, or otherwise; (p) Seller and the Company
have disclosed on their Tax Returns all positions taken therein that could give
rise to a substantial understatement of federal income Tax within the meaning
of Section 6662 of the Code; and (q) the Company’s taxable income for any
period after the Closing Date will not be affected by any closing agreement
under Code Section 7121 (or similar agreement), change in accounting method,
intercompany transaction, excess loss account, installment sale, open
transaction disposition, Code Section 355 distribution, or prepayment made
prior to the Closing Date. 

Section 3.13         Intellectual
Property.

(a)           Set forth on Schedule
3.13(a) of the Disclosure Schedules is a true and complete list of: (i) all
registered ownership of Intellectual Property, (ii) all pending applications to
register ownership of Intellectual Property, (iii) all material unregistered
trademarks, (iv) all material licenses to use Intellectual Property, and (v)
all significant recipes, in each case held by the Company or the Seller
relating to the Business.  Assuming the
validity of ownership of Intellectual Property by all parties from which the
Company licenses Intellectual Property, there are no Intellectual Property
rights, other than those which the Company owns, licenses or has rights to,
necessary to or regularly used in the conduct of the Business as presently
conducted and there are no restrictions that would materially impair the use of
such Intellectual Property.  Assuming the
validity of ownership of Intellectual Property by all parties from which the
Company licenses Intellectual Property, all licenses and other agreements
pursuant to which any Intellectual Property rights, including any computer
software, are licensed to or used by the Company are valid, binding and
enforceable (subject to the Enforcement Exceptions), and there does not exist
under any such license or agreement a default or event or condition which,
after notice or lapse of time or both, would constitute a default by any party
thereto.

(b)           To
the Knowledge of Seller and the Company, (i) with respect to the trademarks
listed on Schedule 3.13(a) of the Disclosure Schedules (the “Major
Marks”), there are no restrictions that would materially impair the use of the
Major Marks in connection with the Business and the Company’s use of the Major
Marks do not infringe upon or otherwise violate the valid and registered
trademarks of any other Person, and (ii) no Person is challenging, infringing
or otherwise violating the Intellectual Property owned by the Company, except
in each case for challenges, infringements or violations, which individually or
in the aggregate, would not be reasonably likely to have a Material Adverse
Effect on the assets of the Company or the Business.

 17

 

 

                (c)           Except as set forth on Schedule 3.13(c) of the
Disclosure Schedules, all statutory Intellectual Property rights required to be
listed on Schedule 3.13(a) of the Disclosure Schedules:

(i)                                      have been duly registered, filed in, or
issued by, the United States Patent and Trademark Office, United States
Register of Copyrights, or the corresponding offices of other countries
identified on said Schedule;

(ii)                                   have been properly maintained and renewed in
accordance with all applicable Laws in the United States and such foreign
countries; and

(iii)                                are freely transferable
(except as otherwise required by Law).

                (d)           Except as set forth on Schedule 3.13(d) of the
Disclosure Schedules, all Intellectual Property rights required to be listed on
Schedule 3.13(a) of the Disclosure Schedules, whether or not statutorily
created:

(i)                                      are owned exclusively by the Company, free
and clear of any licenses, sub-licenses or Encumbrances, such that no other
person has any right or interest in or license to use or right to license
others to use any of the Intellectual Property rights; and

(ii)                                   are not subject to any outstanding Court
Order.

                (e)           Neither the Business nor the Company is, to the Seller’s
or the Company’s Knowledge, infringing any Intellectual Property rights of any
other person and has not been accused in writing or otherwise of infringing the
Intellectual Property rights of any other person.  The Company has adopted measures it deems
commercially reasonable to protect its Intellectual Property.  Copies of all forms of non-disclosure or
confidentiality agreements utilized by the Company to protect trade secrets
have been made available to Buyer.  The Company has the right to use,
free and clear of claims or rights of others, all trade secrets, customer lists
and manufacturing processes required for or incident to its products and
services, and it is not using any confidential information or trade secrets of
any former employer of any of its past or present employees.

                (f)            The Company and Seller believe that the Company’s
information technology systems (including all applicable software and hardware)
are adequate for the Company’s current management and record keeping purposes. 

                Section
3.14         Conduct of Business; Absence
of Certain Changes.

                Since the Balance
Sheet Date, the Company and the Seller have conducted the Business only in the
ordinary course, consistent with prior practices and, whether or not in the
ordinary course of business, there has not been any change in the financial
condition (including working capital, earnings, reserves, properties, assets,
liabilities, business or operations) or otherwise, of

 18
 

 

 

the Business or the Company which change, by itself or in conjunction
with all other such changes, whether or not arising in the ordinary course of
business, has had a Material Adverse Effect on the Business or the
Company.  Without limiting the generality
of the foregoing, subject in each case to the foregoing limitation with regard
to Material Adverse Effect, and except as disclosed on Schedule 3.14 of
the Disclosure Schedules, since the Balance Sheet Date there has not been:

(a)                                  any amendment or other modification to the
articles of incorporation or by-laws of the Company or any of its subsidiary’s
organizational documents (i.e. certificate of incorporation, articles of
incorporation, by-laws);

(b)                                 any contingent liability incurred by the
Company or the Seller (with respect to the Business) as guarantor or otherwise,
with respect to the obligations of others;

(c)                                  any sale, lease or other disposition, or any
agreement or other arrangement for the sale, lease or other disposition, of any
asset or property of the Business other than in the ordinary course of business
consistent with past practice;

(d)                                 any Encumbrance placed on any of the assets
of the Business which remains in existence on the date hereof;

(e)                                  any obligation or liability incurred by the
Company or the Seller (with respect to the Business), other than obligations
and liabilities incurred in the ordinary course of business consistent with
past practice which are less than $50,000 individually (none of which is a
claim for breach of contract, breach of duty, breach of warranty, tort or
infringement of an intellectual property right);

(f)                                    any entry into, termination of, or receipt of
notice of termination of any Contracts or transaction, including: (i) any
indebtedness; (ii) any capital or other lease; or (iii) any guaranty,
by the Company or the Seller (with respect to the Business), except contracts
made in the ordinary course of business consistent with past practices
requiring payments of less than $50,000;

(g)                                 any cancellation, compromise, release or
waiver of any debt, claim or right;

(h)                                 any creation, incurrence or assumption of any
indebtedness for borrowed money or guarantee of any obligation by either the
Company or the Seller

 19
 

 

(with
respect to the Business), except for endorsements of negotiable instruments for
collection in the ordinary course of business;

(i)                                     any payment, discharge or satisfaction of any
material obligation or liability, absolute, accrued, contingent or otherwise,
whether due or to become due, except for any current liabilities, and the
current portion of any long-term liabilities, shown on the Financial Statements
or incurred since the Balance Sheet Date in the ordinary course of business
consistent with past practice;

(j)                                     any capital investment, capital expenditure,
commitment or capital improvement, addition or betterment lease or agreement to
lease assets;

(k)                                  any damage to or destruction or loss of any
asset or property of the Company or the Business whether covered by insurance
or not;

(l)                                     any intercorporate loan or transfer between
the Company and any of its Affiliates, except for transfers between the Company
and the Seller in the ordinary course of business consistent with past
practices;

(m)                               except in the ordinary course of business
consistent with past practice, any change in the compensation or other amounts
payable or to become payable by the Company to any of its directors, officers,
employees, consultants, representatives or agents; or any change in any bonus,
pension or profit sharing payment, entitlement or arrangement made to or with
any of such directors, officers, employees, consultants, representatives or
agents; or any grant of any loans or severance or termination pay; entry into
or variation of any employment, severance or similar contract with any
director, officer, employee, consultant, representative or agent; payment of
any bonuses, salaries or other compensation to any shareholder, director,
officer, consultant, agent or sales representative or employee; or any entrance
into or variation of the terms of any employment agreement or consulting
agreement or adoption or modification of, or increase in, the benefits under
any Company Plan;

(n)                                 any change with respect to the management or
supervisory personnel of the Company;

(o)                                 any payment or discharge of a material
Encumbrance or claim of the Company or the Seller (with respect to the
Business) which was not shown on the Balance Sheet;

(p)                                 any obligation or liability incurred by the
Company to any of its officers or directors or any other Person or any loans or
advances made by the

 20
 

 

Company
to any of its officers or directors or any other Person, except normal
compensation and expense allowances payable to officers in the ordinary course
of business consistent with past practices;

(q)                                 any write-downs of the value of any inventory
included in the assets of the Business or write-offs as uncollectible of any
notes or accounts receivable included in the assets of the Business, except for
write-downs or write-offs incurred in the ordinary course of business;

(r)                                  any
(i) declaration, setting aside or payment of any dividend on, (ii) the making
of any other distribution in respect of, or (iii) any direct or indirect redemption,
purchase or other acquisition by the Company or Seller of, the capital stock of
the Company;

(s)                                any
issuance of any securities of the Company or any of its subsidiaries;

(t)                                  any
disposal, sale, assignment, license or lapse of any rights to the use of any
Intellectual Property;

(u)                               any
sale, assignment, transfer, abandonment of any Government Authorization and no
Government Authorization has been permitted to lapse;

(v)                               any
receipt of notice that any supplier or distributor will stop or decrease in any
material respect the rate of business done with the Company or the Seller (with
respect to the Business);

(w)                             any
entry into any other material transaction, other than in the ordinary course of
business consistent with past practice;

(x)                                   any change in any method of accounting or
accounting practice except as required by GAAP; or

(y)                                  any
agreement, whether in writing or otherwise, to take any action described in
this Section 3.14.

                Section 3.15         Employee Matters and Benefits.

                (a)           Schedule 3.15 of the Disclosure
Schedules lists: (i) all employees and independent contractors (part-time and
full-time) of the Company who had compensation in 2005 greater than $75,000 or
who are expected to have annualized compensation in 2006 greater than $75,000;
(ii) the rate of compensation (both salary, bonus and other compensation)
payable to each such employee and independent contractor; and (iii) the accrued
vacation pay, paid-time off and accrued sick days payable by the Company to
each employee and independent contractor listed thereon as of September 19,
2006.  Except as set forth on Schedule
3.15 of the Disclosure

 21
 

 

Schedules, (A) since December 25, 2005, the Company has not made any
promise or commitment, whether oral or in writing, to increase any employee’s
or independent contractor’s compensation (other than in connection with regular
salary reviews), grant severance pay or grant any bonus to any employee, (B)
the employment or engagement of each employee or independent contractor of the
Company is terminable at will and the Company is not a party to nor does it
have any obligations under any agreement, collective bargaining or otherwise,
with any party regarding the rates of pay or working conditions of any of its
employees, and (C) the Company will not owe any amounts to any of its employees
or independent contractors as of the Closing Date, including, without
limitation, any amounts incurred for wages, commissions, bonuses, vacation pay,
sick leave or severance obligations.

                (b)           Schedule 3.15(b)
of the Disclosure Schedules contains a complete list of each employment
agreement, consulting agreement, employee benefit plan within the meaning of
Section 3(3) of ERISA, stock purchase, stock option, severance,
change-in-control, fringe benefit, bonus, incentive and deferred compensation
plan, agreement, program, policy or other arrangement covering current or
former employees, consultants and other independent contractors of the Company,
whether written or oral, which is maintained, sponsored or contributed to by
Seller or the Company.  All such plans,
agreements, programs, policies and arrangements are collectively referred to as
the “Company Plans.”

                (c)           The Seller or the Company has delivered or made available
to the Buyer correct and complete copies of all training manuals and materials
used by the Company in its management and employee training programs or in any
other training programs maintained or utilized by the Business.

                (d)           The Company has complied in all material respects with all
applicable Laws relating to employment, including, without limitation, those
relating to wages, hours, unfair labor practices, equal opportunity,
discrimination, civil rights, immigration, collective bargaining and the
collection and payment of social security and similar taxes.

                (e)           Except as set forth on Schedule 3.15(b) of the
Disclosure Schedules, there are no complaints, proceedings, investigations or
charges against the Company pending or, to the Company’s or the Seller’s
Knowledge, threatened before any Governmental Authority by or on behalf of, or
with respect to any employee or former employee of the Company.

                (f)            The Company has paid in full (or made provisions for
payment in full) to its employees, agents, consultants and independent
contractors all wages, salaries, commissions, bonuses and other compensation
for all services performed by them. 
Except as set forth on Schedule 3.15 of the Disclosure Schedules, and liabilities arising in the
ordinary course of business since the Balance Sheet Date, the Company does not
have any contingent liability for sick leave, vacation time, holiday pay,
severance pay or similar items not set forth on the Balance Sheet.

 22
 

 

 

                (g)           Since January 1, 2005, there has not been any citation,
fine or penalty imposed or, to the Company’s or the Seller’s Knowledge,
asserted against the Company under any Law relating to employment, immigration
or occupational safety matters.

                (h)           The Company is not a party to any collective bargaining
agreement respecting its employees, nor is there pending, or to the Knowledge
of Seller or the Company, threatened, any strike, walkout, slowdown, lockout or
other work stoppage, organized labor disputes or any union organizing effort by
or respecting the Company’s employees. 
The Company has not experienced any work stoppage or other material
labor difficulty during the five years immediately preceding the date of this
Agreement. There is no grievance or arbitration proceeding pending or, to the
Knowledge of Seller or the Company, threatened.

                (i)            Neither the Seller, the Company nor any entity that is
considered one employer with the Seller or the Company under Title IV of ERISA
or Section 414(b) or (c) of the Code sponsors, contributes or has an obligation
to contribute, or has within the past five (5) years sponsored, contributed or
had an obligation to contribute, to any pension or welfare benefit plan that is
subject to Title IV of ERISA (including any “multiemployer plan,” as defined in
Sections 3(37) or 4001(a)(3) of ERISA).

                (j)            The Company has no contingent liability with respect to
any post-retirement benefits under any medical or other welfare plan, other
than liability for continuation
coverage described in Section 4980B of the Code.

                (k)           The Company has not engaged in any material non-exempt
prohibited transaction, as defined in Section 406 of ERISA or Section 4975 of
the Code, with respect to any Company Plan.

                (l)            Each Company Plan that is intended to be qualified under
Section 401(a) of the Code has
received a determination letter as to its qualified status from the IRS, or is
entitled to rely on an opinion letter issued to a prototype sponsor.

                (m)          Each Company Plan is being administered in all material
respects in accordance with the documents and instruments governing such plan,
and such documents and instruments are consistent in all material respects with
the applicable provisions of the ERISA and the Code which have become effective
and operative with respect to such plan as of the date of this Agreement.

                (n)           No Company Plans are currently under audit or, to the
Seller’s or the Company’s Knowledge, investigation by a Governmental Entity and
no self-correction proceeding has been initiated with the Internal Revenue
Service or the U.S. Department of Labor.

                (o)           The Company is in compliance in all material respects with
all worker safety Laws, including, but not limited to, applicable requirements
under the Occupational Safety and Health Act.

 23
 

 

 

                Section 3.16         Environmental Matters.

                (a)           Any Hazardous Materials
used or generated by the Company have always been and are being generated,
used, stored, treated and disposed on and at any Environmental Site in compliance in all material respects with all applicable
Laws, Court Orders, Governmental Authorizations, including Environmental
Laws.  The Company is in compliance in
all material respects with all Environmental Laws.

                (b)           The Company has not become
subject to any Court Order, nor has it received, or, to the Knowledge of the
Seller or the Company, become subject to any written claim, notice, complaint
or request for information from any Governmental Authority or any private
party: (i) alleging violation of or noncompliance with any Environmental Law;
(ii) asserting potential liability under any Environmental Law; or (iii)
requesting investigation or clean-up of any Environmental Site under any
Environmental Law.

                (c)           No Hazardous Materials used or
generated by the Company, its present and former Affiliates, or, to the Company’s
and Seller’s Knowledge, any predecessors-in-interest to the Company, have ever
been, are being, or are intended to be or are threatened with being spilled,
released, discharged, disposed, placed, leaked, or otherwise caused to become
located in the air, soil or water in, under or upon an Environmental Site or
any land adjacent thereto in material violation of any Environmental Law.  To the Knowledge of the Company and Seller,
no Hazardous Materials have been released at or onto any Environmental Site by
any Person in material violation of any Environmental Law.

                (d)           The Seller and the Company have not
received any notice that any sites or facilities to which any Hazardous
Materials have been shipped or sent to are subject to or threatened to become
subject to any governmental response action or clean up order.

                (e)           Hazardous Materials have been collected,
managed, recycled, shipped and disposed by the Company and its present and
former Affiliates in compliance in all material respects with all Environmental
Laws.

                (f)            There are no underground tanks for
Hazardous Materials located at any Environmental Site.

                (g)           All wells, water discharges and other
water diversions and all air emission sources on any Environmental Site are in
compliance in all material respects with all Environmental Laws.

                (h)           To the Knowledge of the Company and
the Seller, there are no asbestos containing materials in a damaged condition
at any Environmental Site.

                (i)            To the Company’s and Seller’s
Knowledge: (i) there are no Encumbrances under any Environmental Laws affecting
the Company’s interest in any Environmental Site; and (ii)

 24
 

 

no action by any Governmental Authority has been taken or is in process
which would reasonably be expected to result in an Encumbrance under any
Environmental Law affecting the Company’s interest in any Environmental Site.

                (j)            The Company or Seller has delivered or made available to
the Buyer true and complete copies of all environment reports, studies,
investigations or correspondence in possession of the Company or Seller or any
of their agents or consultants regarding environmental matters relating to the
Company or the Business or any environmental conditions at any of the
Environmental Sites, including, but not limited to, Phase I Environmental
Assessments, asbestos surveys, indoor air or mold investigations or similar
reports.

                Section 3.17         Insurance.

                (a)           Schedule 3.17
of the Disclosure Schedules hereto lists all insurance policies
maintained by or on behalf of the Company. 
The policies listed on Schedule 3.17 of the Disclosure Schedules will not be adversely affected by,
or terminate or lapse by reason of, the transactions contemplated by this
Agreement or the Ancillary Agreements. 
Neither the Company nor Seller (with respect to the Business) has been
refused any insurance with respect to the Business or the assets of the
Company.

                (b)           Except for amounts deductible under
the policies of insurance described on Schedule 3.17 of the Disclosure Schedules or with
respect to risks assumed as a self-insurer and described on such Schedule,
neither the Company nor the Seller is, nor has ever been, subject to any
liability as a self-insurer of the Business or assets of the Company.

                (c)           Except as set forth on Schedule 3.17 of the Disclosure Schedules, there are
no claims pending under any of said policies, or disputes with insurers, and
all premiums due and payable thereunder have been paid, and all such policies
are in full force and effect in accordance with their respective terms.  Schedule 3.17 of
the Disclosure Schedules also sets forth the insurance claims with
respect to the Business for the last two full fiscal years and the current
fiscal year.  No notice of cancellation
or termination has been received with respect to any such policy and, to the
Knowledge of the Company and Seller, there is no basis upon which the insurance
company would have the right to terminate any such policy during the policy
term, and no notice relating to non-renewal, reduction of coverage or increase
in premium has been received by the Company or the Seller with respect to any
such policy.

                (d)           Except as set forth on Schedule
3.17 of the Disclosure Schedules,
the Company does not have a current or prior insurance policy which remains
subject to a retrospective adjustment of the premiums payable thereunder.

                Section 3.18         Prepaid
Amounts.

                Except as reflected in the Financial Statements, or
arising in the ordinary course of business since the Balance Sheet Date, the
Company does not have any outstanding obligations

 25
 

 

to deliver goods or services
in the future whether pursuant to gift certificates, prepaid gift cards or
otherwise.

Section
3.19         Suppliers.

                Schedule 3.19
of the Disclosure Schedules sets forth a true, correct and complete list of the
ten largest suppliers of the Company (based on purchases from December 27, 2004
through March 26, 2006), together with the volume of the purchases made from
such suppliers during such period. 
Except as set forth on Schedule 3.19 of the Disclosure Schedules,
no supplier is a sole source of supply of any good or service used by the
Company.  None of the suppliers has
canceled or otherwise terminated or, to the Knowledge of the Company or Seller,
threatened to cancel or otherwise terminate its relationship with the
Company.  No supplier has notified the
Company of its intention to decrease or materially limit the services, supplies
or materials sold or furnished to the Company where such action would be
reasonably likely to have a Material Adverse Effect.

                Section 3.20         Capital Expenditures.

                Schedule 3.20
of the Disclosure Schedules lists for each of the properties relating to the
Leased Real Property as of June 25, 2006: (i) any contemplated capital
improvement, individually in excess of $50,000 or in the aggregate in excess of
$200,000; and (ii) any contemplated maintenance outside of the ordinary course
of business or repair capital expenditure in excess of $50,000 in the
aggregate.

                Section 3.21         Brokers and Finders.

                Other than BB&T Capital
Markets (“BB&T”), Seller and the Company have not employed any broker,
finder, consultant or intermediary in connection with the transactions
contemplated by this Agreement who would be entitled to a broker’s, finder’s or
similar fee or commission in connection therewith or upon the consummation
thereof, or if the Closing does not occur. 
Seller agrees to bear all costs it incurs, including fees and expenses
of BB&T, in connection with the transactions contemplated by this Agreement
unless otherwise expressly provided herein.

                Section 3.22         Corporate Books, Records and Accounts.

                (a)           The minute books and stock records of the Company
accurately record all action taken by the stockholders, board of directors and
committees thereof of the Company, and all issuances and transfers of capital
stock of the Company. Complete and accurate copies of all minute books and
stock records of the Company have been delivered or made available to Buyer.

                (b)           The books, records and accounts of the Company are
complete and correct in all material respects and have been maintained in
accordance with GAAP applied on a consistent basis.  The system of internal accounting controls for
the Company is sufficient to provide reasonable, but not absolute, assurance
that: (i) transactions are executed in accordance with 

 26
 

 

management’s
general or specific authorization; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with GAAP and to
maintain accountability for assets; (iii) access to assets is permitted only in
accordance with management’s general or specific authorization; and (iv) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.

                Section 3.23         Borrowings and Guarantees.

                Except as shown on
Schedule 3.23 of the Disclosure
Schedules, there are no agreements or undertakings pursuant to which:
(a) the Company or the Business is borrowing or is entitled to borrow any
money; (b) the Company or the Business is lending or has committed itself to
lend any money; or (c) the Company, the Business or the Seller (with respect to
the Business) is a guarantor or surety with respect to the obligations of any
Person.  Complete and accurate copies of
all such written agreements have been delivered to Buyer and are attached to Schedule
3.23 of the Disclosure
Schedules.

                Section
3.24         Directors and Officers;
Financial Service Relations and Powers of Attorney.

Schedule
3.24 of the Disclosure
Schedules lists all officers and directors of the Company.  All of the arrangements which the Company or
the Business has with any bank depository institution or other financial
services entity, whether or not in the Company name, are completely and
accurately described on Schedule 3.24
of the Disclosure Schedules, indicating with respect to each of such
arrangements the type of arrangement maintained (such as checking account,
borrowing arrangements, safe deposit box, etc.) and the current balance as of
the date reported, banking institution and person or persons authorized in
respect thereof.  The Company does not
have any outstanding power of attorney.

                Section
3.25         Absence of Sensitive
Payments.

The
Company has not, nor to the Knowledge of the Company or the Seller, have any of
the Company’s directors, officers, agents, stockholders or employees or any
other person associated with or acting on behalf of the Company:

                (a)           made or agreed to make any
solicitations, contributions, payments or gifts of funds or property to any
governmental official, employee or agent where either the payment or the
purpose of such solicitation, contribution, payment or gift was not in material
compliance with the laws of the United States, any state thereof, or any
foreign jurisdiction or prohibited by the policy of the Company or of any of
its suppliers or customers;

 27
 

 

                (b)           for any purpose established or
maintained any fund or asset that was required to be presented or disclosed in
the Financial Statements, but what was not so presented or disclosed in the
Financial Statements;

 

                (c)           established
or maintained any fund or asset for an illegal purpose;

                (d)           made
any materially false or artificial entries on any of its books or records for
any reason; or

                (e)           made or agreed to make any
contribution or expenditure, or reimbursed any political gift or contribution
or expenditure made by any other person to candidates for public office, whether
national, regional or local (foreign or domestic) where such contributions were
not in material compliance with applicable Law.

                Section 3.26         No Other Representations or Warranties. 

                No representation or warranty
made by the Seller and/or the Company to the Buyer and/or the Parent in this
Agreement, any Ancillary Agreement, any document or certificate delivered
pursuant to this Agreement or any Ancillary Agreement or in any schedules or
exhibits attached hereto or thereto, when read in the aggregate, contains any
untrue statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading.  Except for the
representations and warranties made by the Seller and/or the Company to the
Buyer and/or the Parent contained in this Agreement, any Ancillary Agreement,
any document or certificate delivered pursuant to this Agreement or any
Ancillary Agreement or in any schedules or exhibits attached hereto or thereto,
neither Seller, the Company, nor any other Person makes any other express or
implied representation or warranty on behalf of Seller or the Company.

ARTICLE
IV

Representations
and Warranties of Buyer and Parent

                Buyer (except with respect to
Section 4.2) and the Parent, jointly and severally, represent and warrant to
Seller as follows:

                Section 4.1            Organization and Authority of Buyer;
No Conflicts.

                Buyer is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, has all requisite corporate power and authority to own, operate and
lease its properties and to conduct its business in the manner and in the
places where such properties are owned or leased or such business is conducted
by it.  Buyer has taken all corporate action
necessary in order to execute, deliver and perform its obligations under this
Agreement and the Ancillary Agreements to which it is a party. This Agreement
and the Ancillary

 28
 

 

Agreements to
which it is a party are legal, valid and binding obligations of Buyer,
enforceable in accordance with their terms, subject to the Enforcement
Exceptions.  The execution, delivery and
performance of this Agreement and the Ancillary Agreements to which it is a
party by Buyer do not, and the consummation by Buyer of the transactions
contemplated hereby and thereby will not, constitute or result in: (A) a breach
or violation of, or a default, or required notice under, the certificate of
incorporation or by-laws of Buyer, (B)  a
breach or violation of, or a default under, the acceleration of any
obligations, termination, cancellation or the creation of an Encumbrance on the
assets of Buyer (with or without notice, lapse of time or both), or required
notice pursuant to any Contracts binding upon Buyer, (C)  violate any Law or Government Authorization
or non-governmental permit or license to which Buyer is subject, (D) any change
in the rights or obligations of any party under any of the Contracts to which
Buyer is party, or (E) creation or imposition of any Encumbrance upon any of
the Buyer’s assets.

                Section 4.2            Organization and Authority of Parent;
No Conflicts.

                Parent is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, has all requisite corporate power and authority to own, operate and
lease its properties and to conduct its business in the manner and in the
places where such properties are owned or leased or such business is conducted
by it.  Parent has taken all corporate
action necessary in order to execute, deliver and perform its obligations under
this Agreement and the Ancillary Agreements to which it is a party. This
Agreement and the Ancillary Agreements to which it is a party are legal, valid
and binding obligations of Parent, enforceable in accordance with their terms,
subject to the Enforcement Exceptions. 
Except as set forth on Schedule 4.2 of the Disclosure Schedules,
the execution, delivery and performance of this Agreement and the Ancillary
Agreements to which it is a party by Parent do not, and the consummation by
Parent of the transactions contemplated hereby and thereby will not, constitute
or result in (A) a breach or violation of, or a default, or required notice
under, the certificate of incorporation or by-laws of Parent, (B) a breach or
violation of, or a default under, the acceleration of any obligations,
termination, cancellation or the creation of an Encumbrance on the assets of
Parent (with or without notice, lapse of time or both) or required notice
pursuant to any Contracts binding upon Parent, (C) violate any Law or
Government Authorization or non-governmental permit or license to which Parent
is subject, (D) any change in the rights or obligations of any party under any
of the Contracts to which Parent is party, or (E) creation or imposition of any
Encumbrance upon any assets of the Parent.

                Section 4.3            Brokers and Finders.

                Neither Buyer nor Parent has
employed any broker, finder, consultant or intermediary in connection with the
transactions contemplated by this Agreement who would be entitled to a broker’s,
finder’s or similar fee or commission in connection therewith or upon the
consummation thereof, or if the Closing does not occur.

 29
 

 

                Section 4.4            Parent Financial Statements.

                Attached hereto as Schedule
4.4 of the Disclosure Schedules are copies of: (a) Parent’s consolidated
statements of operations and consolidated statements of cash flows for each of
the years ended December 29, 2004 and December 28, 2005 (collectively, the “Parent
2004/2005 Statements”); (b) Parent’s consolidated statements of operations and
consolidated statements of cash flows for the period of December 29, 2005
through June 28, 2006 (the “Parent 2006 Statements”); and (c) Parent’s
consolidated balance sheets as of each of December 29, 2004, December 28, 2005
and June 28, 2006 (together with the Parent 2004/2005 Statements and the Parent
2006 Statements, the “Parent Financial Statements”).  The Parent Financial Statements have been
prepared in accordance with GAAP applied on a consistent basis throughout the
periods involved and prior periods (except that the Parent 2006 Statements and
Parent’s consolidated balance sheets as of June 28, 2006 lack the footnotes
required by GAAP and are subject to ordinary year-end adjustments), are
complete and correct in all material respects and present fairly, in all
material respects, the assets, liabilities and financial position of Parent and
the results of operations and changes in the financial condition of Parent for
the periods covered by such Parent Financial Statements.  The Parent Financial Statements are consistent
with the books and records of Parent (which, in turn, are accurate and complete
in all material respects).

                Section
4.5            Conduct of Parent
Business; Absence of Certain Parent Changes.

                Since
June 28, 2006, Parent has conducted its business only in the ordinary course,
consistent with prior practices and, whether or not in the ordinary course of
business, there has not been any change in the financial condition (including
working capital, earnings, reserves, properties, assets, liabilities, business
or operations) or otherwise, of Parent or the business of Parent, which change,
by itself or in conjunction with all other such changes, whether or not arising
in the ordinary course of business, has had a material adverse effect on Parent
or the business of Parent.

                Section 4.6            Financial Capability.

                On the Closing Date, Buyer will
have sufficient funds to purchase the Shares on the terms and conditions
contemplated by this Agreement.

 30
 

 

                Section 4.7            Investment Intent and Experience;
Share Resale Restrictions.

                Buyer is acquiring the Shares
solely for the purpose of investment and not with a view to, or for sale in
connection with, any distribution thereof in violation of the Securities
Act.  Buyer acknowledges that the Shares
are not registered under the Securities Act or any applicable state securities
law, and that such Shares may not be transferred or sold except pursuant to the
registration provisions of the Securities Act or pursuant to an applicable
exemption therefrom and pursuant to state securities laws and regulations as
applicable.  Buyer has such knowledge and
experience in financial and business matters that Buyer is capable of
evaluating the merits and risks of its investment in the Shares and of making
an informed investment decision with respect thereto.

                Section 4.8            Consents and Approvals.

                Other than the filings, notices,
reports, consents, registrations, approvals, permits or authorizations set
forth on Schedule 4.8 of the Disclosure Schedules, no notices, reports
or other filings are required to be made by Parent or Buyer with, nor are any
consents, registrations, approvals, permits or authorizations required to be
obtained by Parent or Buyer from, any Person, in connection with the execution
and delivery of this Agreement by Buyer and Parent and the consummation by
Buyer and Parent of the transactions contemplated hereby except those that the
failure to make or obtain are not, individually or in the aggregate, reasonably
likely to prevent, delay or impair the ability of Buyer to consummate the
transactions contemplated by this Agreement.

                Section 4.9            No Other Representations or
Warranties.

                Except for the representations
and warranties made by Buyer and/or Parent to Seller and/or Company contained
in this Agreement, any Ancillary Agreement, any document or certificate
delivered pursuant to this Agreement or any Ancillary Agreement or in any
schedules or exhibits attached hereto or thereto, neither Buyer, Parent nor any
other Person makes any other express or implied representation or warranty on
behalf of Buyer or Parent.

ARTICLE V

Tax
Matters

                Section 5.1            Liability for Taxes and Related
Matters.

                (a)           Seller will be liable for and indemnify Buyer for all
Taxes (including, without limitation, any obligation to contribute to the
payment of a tax determined on a consolidated, combined or unitary basis with
respect to a group of corporations that includes or included the Company and
Taxes resulting from the Company ceasing to be a member of Seller’s Group) (i)
imposed on Seller’s Group (other than the Company) for any taxable year and
(ii) imposed on the Company or for which the Company may otherwise be liable
for any taxable year or period that ends on or before the Closing Date and,
with respect to any taxable year or period beginning

 31
 

 

before and ending
after the Closing Date, the portion of such taxable year ending on and
including the Closing Date. Seller will also indemnify, defend and hold
harmless Buyer from all costs and expenses incurred by Buyer (including
reasonable attorneys’ fees and expenses) in connection with any liability to,
or claim by, any taxing authority, for Taxes for which Seller is required to
indemnify Buyer under this Article V. 
Except as set forth in Section 5.1(e), Seller is entitled to any refund
of Taxes of the Company received for such periods.

                (b)           Buyer will be liable for and indemnify Seller for the
Taxes of the Company for any taxable year or period that begins after the
Closing Date and, with respect to any taxable year or period beginning before
and ending after the Closing Date, the portion of such taxable year beginning
after the Closing Date. Buyer will also indemnify, defend and hold harmless
Seller from all costs and expenses incurred by Seller (including reasonable attorneys’
fees and expenses) in connection with any liability to, or claim by, any taxing
authority, for Taxes for which Buyer is required to indemnify Seller under this
Article V.  Buyer is entitled to any
refund of Taxes of the Company received for such periods.

                (c)           For purposes of paragraphs (a) and (b), whenever it is
necessary to determine the liability for Taxes based on or measured by income
or receipts of the Company for a portion of a taxable year or period that
begins before and ends after the Closing Date, the determination of the Taxes
of the Company for the portion of the year or period ending on, and the portion
of the year or period beginning after, the Closing Date will be determined
based on an interim closing of the books as of, and by assuming that the
Company had a taxable year or period which ended at the close of, the Closing
Date, except that exemptions, allowances or deductions that are calculated on
an annual basis, such as the deduction for depreciation, and all other Taxes
will be apportioned on a time basis (with appropriate adjustments for any
changes in assets or liabilities).

                (d)           Any payment by Buyer or Seller under this Article V will
be an adjustment to the Purchase Price which will be effected in a manner
identical to that provided in Section 9.2 or 9.3 (as applicable).

                (e)           If Seller becomes entitled to a refund or credit of Taxes
(or other reduction in Tax liability) for any period for which it is liable
under Section 5.1(a) to indemnify Buyer and such Taxes are attributable solely
to the carryback of losses, credits or similar items attributable to the
Company and from a taxable year or period that begins after the Closing Date
(or that portion of the current taxable year that begins on the day after the
Closing Date), Seller will promptly pay to Buyer the amount of such refund or
credit together with any interest thereon, computed at 8.00% per annum.  At Buyer’s request, Seller shall cooperate
with Buyer and the Company in obtaining such Tax refund or credit (or other
reduction in Tax liability), including through the preparation and filing of
amended Tax Returns and claims for refund. In the event that any refund or
credit of Taxes for which a payment has been made from Seller to Buyer under
this Section 5.1(e) is subsequently reduced or disallowed, Buyer will indemnify
and hold harmless Seller for any tax liability, including interest and
penalties, assessed against Seller by reason of the reduction or disallowance.

 32
 

 

                (f)            Seller will file or cause to be
filed when due all Tax Returns that are required to be filed by or with respect
to the Company for taxable years or periods ending on or before the Closing
Date and will pay any Taxes due in respect of such Tax Returns and shall
prepare and file such Tax Returns in a manner consistent with past practice
(except as required by a change in applicable Law).  Buyer will file or cause to be filed when due
all Tax Returns that are required to be filed by or with respect to the Company
for taxable years or periods ending after the Closing Date and will pay any
Taxes due in respect of such Tax Returns. Seller will pay Buyer the Taxes for
which Seller is liable pursuant to Section 5.1(a), but which are payable with
Tax Returns to be filed by Buyer pursuant to the previous sentence within 10
days prior to the due date for the filing of such Tax Returns.

                (g)           Buyer will promptly notify Seller in writing upon receipt
by Buyer, any of its Affiliates or the Company of notice of any pending or
threatened federal, state or local tax audits or assessments which may
materially affect the tax liabilities of the Company for which Seller would be
required to indemnify Buyer pursuant to Section 5.1(a), provided that
failure to comply with this provision will not affect Buyer’s right to
indemnification hereunder. Seller has the sole right to represent the Company’s
interests in any tax audit or administrative or court proceeding relating to
taxable periods ending on or before the Closing Date, and to employ counsel of
its choice at its expense, but Buyer shall have the right to participate in
such proceeding at its own expense. Notwithstanding the foregoing, Seller may
not settle, either administratively or after the commencement of litigation,
any claim for Taxes which would adversely affect the liability for Taxes of
Buyer or the Company for any period after the Closing Date to any extent
(including, but not limited to, the imposition of income tax deficiencies, the
reduction of asset basis or cost adjustments, the lengthening of any
amortization or depreciation periods, the denial of amortization or
depreciation deductions, or the reduction of loss or credit carryforwards)
without the prior written consent of Buyer. Such consent may not be
unreasonably withheld, and will not be necessary to the extent that Seller has
indemnified Buyer against the effects of any such settlement.

                (h)           Seller may participate at its expense in the defense of
any claim for Taxes for a year or period ending after the Closing Date which
may be the subject of indemnification by Seller pursuant to Section 5.1(a) and,
with the written consent of Buyer (which consent may be withheld in Buyer’s
sole and absolute discretion), and at its sole expense, may assume the entire
defense of such tax claim. Neither Buyer nor the Company may agree to settle
any tax claim for the portion of the year or period ending after the Closing
Date which may be the subject of indemnification by Seller under Section 5.1(a)
without the prior written consent of Seller, which consent may not be
unreasonably withheld.

                Section 5.2            Transfer Taxes.

                All transfer Taxes which may be
imposed or assessed as a result of Buyer’s acquisition of the Shares, including
all transfer, documentary, sales, use, stamp, registration, conveyance,
recording or similar Taxes, including any penalties and interest (collectively,
the “Transfer Taxes”) will be borne equally by Seller and Buyer.  Each of Seller and Buyer shall pay such

 33
 

 

amounts due by
them when due and shall provide notice, including appropriate documentation of
such payment, to the other party in accordance with Section 11.13.  Promptly upon receipt of such notice, the
receiving party shall reimburse one half of such payment to the party that made
the original payment.  Seller and Buyer,
at their own respective expense, will file all necessary Tax Returns and other
documentation with respect to such Transfer Taxes and, if required by
applicable laws, will jointly execute the other party’s Tax Returns.

                Section 5.3            Information to be Provided by Buyer.

                With respect to the taxable
period in 2006 prior to the Closing Date, Buyer will promptly cause the Company
to prepare and provide to Seller a package of tax information materials (the “Tax
Package”), which will be completed in accordance with past practice of the
Company including past practice as to providing the information, schedules and
work papers and as to the method of computation of separate taxable income or
other relevant measure of income. Buyer will cause the Tax Package for the
portion of the taxable period ending on the Closing Date to be delivered to
Seller within one hundred twenty (120) days after the Closing Date.

                Section 5.4            Assistance and Cooperation.

After the Closing Date, each of Seller and Buyer will:

(i)                                    reasonably
assist (and cause their respective Affiliates to assist) the other party in
preparing any Tax Returns or reports which such other party is responsible for
preparing and filing in accordance with this Article V;

(ii)                                 reasonably
cooperate in preparing for any audits of, or disputes with taxing authorities
regarding, any Tax Returns of the Company;

(iii)                              make
available to the other and to any taxing authority as reasonably requested all
information, records, and documents relating to Taxes of the Company;

(iv)                             provide
timely notice to the other in writing of any pending or threatened tax audits
or assessments of the Company for taxable periods for which the other may have
a liability under this Article V, provided, that failure to comply with
this provision will not affect the other party’s rights to indemnification
hereunder; and

(v)                                furnish
the other with copies of all correspondence received from any taxing authority
in connection with any tax audit or information request with respect to any
such taxable period for which the other may have a liability under this Article
V.

 34

 

 

Section 5.5            Tax
Sharing Agreements.

Any and all tax sharing, tax indemnity, or tax
allocation agreements with respect to which the Company was a party at any time
prior to the Closing will terminate upon the Closing. No further amounts will
be payable by the Company under such agreements following the Closing.

Section 5.6            Other
Elections and Changes.

Seller
shall not elect to retain, and shall not attempt to reattribute to Seller or
any of its Affiliates, any net operating loss carryovers or capital loss carryovers
of the Company or any of the Company’s subsidiaries.  At its sole option, Buyer may elect, or may
cause the Company to elect, where permitted by law, to carry forward any net
operating loss, net capital loss, charitable contribution, or other item
arising after the Closing Date that would, absent such election, be carried
back to a taxable period ending on or before the Closing Date.

ARTICLE VI

Certain
Covenants and Agreements

Section 6.1             Retention of Books and
Records.

Buyer
will cause the Company to retain, until all applicable tax statutes of
limitations (including periods of waiver) have expired, all books, records and
other documents pertaining to the Company in existence on the Closing Date that
are required to be retained under current retention policies and to make the
same available after the Closing Date for inspection and copying by Seller or
its agents at Seller’s expense, during regular business hours and upon
reasonable request and upon reasonable advance notice. After the expiration of
such period, no such books and records will be destroyed by Buyer without first
advising Seller in writing detailing the contents thereof and giving Seller at
least 120 days to obtain possession thereof. 
Seller agrees that such records will be kept strictly confidential and
used only for tax purposes.

Section 6.2            Closing
Date Financial Statements.

For
a period of one year from and after the Closing Date, to the extent reasonably
necessary for Seller or its Affiliates to prepare consolidated financial
statements or obtain any governmental permits, licenses or required filings and
to comply with reporting obligations in respect thereof, upon written request
of Seller, the Company will use its reasonable commercial efforts to provide,
and Buyer will use its reasonable commercial efforts to cause the Company to
provide, to Seller and its accountants within 20 Business Days of such request
with such access to employees and Buyer’s accountants and financial information
of the Company as of the Closing Date as Seller may reasonably request in the
format customarily required by Seller or its subsidiaries and, upon Seller’s
request, it will be accompanied by supplemental financial schedules customarily
required by Seller or its subsidiaries in support of such, provided however,
that such support and access may not unreasonably disrupt the business
operations of the 

 35
 

 

 

Company or the Parent. 
Seller agrees that such records will be kept strictly confidential and
used only for the purpose of preparing consolidated financial statements or
obtaining any governmental permits, licenses or required filings.  To the extent that the Buyer or the Company
incurs any out-of-pocket expenses in providing any assistance to Seller
pursuant to this Section 6.2, the Seller agrees to reimburse the Buyer and/or
the Company (as applicable) within 30 days after receiving an invoice from the
Buyer and/or the Company (as applicable) for such out-of-pocket expenses.

Section 6.3            Change
of Company Name.

On or before January 3, 2007, Buyer will change the
name of the Company to any name which does not include the name “BUCA” or “Buca
di Beppo” (or anything confusingly similar to “BUCA” or “Buca di Beppo”).

Section 6.4            Landlord
Estoppel Certificates.

Seller acknowledges and agrees that should it not be
able to obtain from the landlord of any Real Property Lease an estoppel
certificate listed on Schedule 1.3(e)(i) of the Disclosure Schedule on
or prior to the Closing, at the Closing it shall deliver an estoppel
certificate relating to such Real Property Lease to the Buyer in a form
reasonably acceptable to the Buyer (all such estoppel certificates referred to
herein as the “Seller Estoppel Certificates”).

Section 6.5            Employee
Benefits.

(a)           Buyer will offer group medical and
other welfare benefits to employees of the Company and their eligible
dependents effective as of the Closing Date under terms and conditions
substantially similar to the terms and conditions applicable to similarly
situated employees of the Buyer.  Buyer
will waive any otherwise applicable “pre-existing condition” exclusions under
such plans for employees of the Company and their eligible dependents, and will
credit such employees and eligible dependents with any deductibles, co-payments
or other cost-sharing amounts incurred by the employees or eligible dependents
under the Company Plans during the period beginning on the first day of the
most recent plan year of the Company Plans and ending on the Closing Date.  Seller will retain any obligation to provide
continuation coverage under Section 4980B of the Code with respect to any “M
& A Qualified Beneficiaries” with respect to a stock sale (as described in
Treasury Regulation Section 54.4980B-9 Q&A-4(b)).

(b)           Buyer will credit employees of the
Company with all years of service with the Company and its Affiliates prior to
the Closing Date for the purpose of determining how much vacation, holiday pay
and sick pay the employees are entitled to under the applicable plans of the
Buyer (subject to appropriate offset for any vacation, holiday and sick pay
accrued by the employees as of the Closing Date, which accrued amounts will
remain an obligation of the Company after the Closing Date), and for purposes
of determining eligibility to participate and vesting percentages in any
service-based employee benefit plan or program offered to the 

 36
 

 

 

employees on or after the Closing Date (but not for
purposes of benefit accrual or entitlement to any retirement, early retirement
or subsidized benefits based on service). 

(c)           Buyer will not assume or otherwise
become liable for long-term disability payments to any employee or former
employee of the Company who does not actively work for the Company or the Buyer
on or after the Closing Date.

(d)           Buyer will assume any and all
outstanding balances and liability under the medical expense flexible spending
arrangement maintained by the Seller with respect to employees of the Company
as of the Closing Date and will continue such arrangement for the remaining
portion of the plan year, recognizing any coverage and contribution election
made by such employees for the plan year, and providing for continued
contributions on a pre-tax basis under a cafeteria plan, within the meaning of
Section 125 of the Code, of the Buyer or established for the Company by the Buyer.

(e)           Buyer will allow employees of the
Company to roll over any eligible roll over distribution, as defined in Section
402(f)(2) of the Code, received after the Closing Date from the defined
contribution plan sponsored by the Seller to a defined contribution plan
sponsored by the Buyer or established for the Company by the Buyer and, in the
case of any such employee who has an outstanding loan from the plan, will allow
such employee to rollover such loan in-kind and continue repayment of such loan
under the recipient plan. 

(f)            Seller has taken such actions as are
necessary or appropriate to remove the Company as a participating employer
under the Company Plans effective as of the Closing Date.

(g)           On the Closing Date, the Seller will
pay an aggregate of $125,000.00 to employees of the Company pursuant to those
Contracts set forth on Schedule 6.5(g) of the Disclosure Schedule.

Section 6.6            Litigation.

(a)           In the event and for so long as any
party actively is contesting or defending against any action, suit, proceeding,
hearing, investigation, charge, complaint, claim, or demand (each, an “Action”)
in connection with (other than any Action being pursued by any party to this
Agreement against another party to this Agreement): (a) any transaction
contemplated under this Agreement or (b) any fact, situation, circumstance,
status, condition, activity, practice, plan, occurrence, event, incident,
action, failure to act, or transaction on or prior to the Closing Date
involving the Company or the Business, each of the other parties will
reasonably cooperate with such party and such party’s counsel in the contest or
defense, make available his, her, or its personnel, and provide such testimony
and access to his, her, or its books and records as will be necessary in connection
with the contest or defense, all at the sole cost and expense of the contesting
or defending party (unless the contesting or defending party is entitled to
indemnification therefore under Article IX).

 37
 

 

 

(b)           The Seller understands and agrees
that after the Closing Date the Company alone (and without the consent of the
Seller) shall have the authority to prosecute, defend against, compromise and
settle all Actions based upon any fact, situation, circumstance, status,
condition, activity, practice, plan, occurrence, event, incident, action,
failure to act, or transaction on or prior to the Closing Date involving the
Company or the Business, including, but not limited to, those Actions set forth
on Schedule 3.8 of the Disclosure Schedules, provided however,
that the Company may not consent to the entry of a judgment in such Action or
effect a settlement of any such Action (collectively, a “Settlement”) without
the prior written consent of the Seller unless: (i) the Seller is not required
to pay or deliver any consideration in connection with such Settlement, and
(ii) if the Seller is a named defendant in such Action at the time of such
Settlement, the plaintiff or claimant provides the Seller with a release from
any and all claims brought in such Action against the Seller.

Section 6.7            Licenses.

Seller
agrees it shall: (a) cause the employees and/or officers of Seller, as
approved by the relevant state and/or local licensing agencies and
requested by Buyer, to execute all license renewal applications for 2007,
including all liquor license applications, required to operate the Business (as
conducted on the Closing Date) on behalf of Buyer; and (b) cause any such
license renewal application to be executed and delivered to the Buyer within
five (5) Business Days after the delivery of the application to the Seller.

Section 6.8            Further
Assurances.

At
any time after the Closing Date, Seller and Buyer will, and Buyer will cause
the Company to, promptly execute, acknowledge and deliver any other assurances
or documents reasonably requested by Buyer or Seller, as the case may be, and
necessary for Buyer or Seller, as the case may be, to satisfy its obligations
hereunder or obtain the benefits contemplated hereby.

Section 6.9            Maintenance
of Government Authorizations.

Seller and the Company shall use reasonably commercial efforts to not
take any action or permit any of any of their representatives to take any
action which would cause any Governmental Authority to institute proceedings
regarding any of the Government Authorizations or take any other action which
would result in the Company being in noncompliance in any material respect with
the requirements of any Governmental Authority having jurisdiction thereof.

Section 6.10         No
Hire; Non-Solicitation.

(a)           For a period of one
(1) year after the Closing Date, neither the Seller nor any of its Affiliates
shall hire, recruit or otherwise solicit or induce any Company Subject
Employees (as defined below) to terminate their employment or engagement with,
or otherwise cease their 

 38
 

 

 

relationships with, the Company or its Affiliates. As
used herein, the term “Subject Employees” means employees (at the Assistant
General Manager level or above) or consultants of the Company: (i) who are
employees or consultants of the Company on the Closing Date; (ii) who are
employees or consultants of the Company at any time after the Closing Date; or
(iii) who were employees or consultants of the Company at any time during the
six months prior to the Closing Date.

(b)           For a period of one (1) year after
the Closing Date, neither Parent nor any of its Affiliates shall hire, recruit
or otherwise solicit or induce any Seller Subject Employees (as defined below)
to terminate their employment or engagement with, or otherwise cease their
relationships with, Seller or its Affiliates. 
As used herein, the term “Seller Subject Employees” means employees (at
the Assistant Manager level or above) or consultants of Seller: (i) who are
employees or consultants of the Seller on the Closing Date; (ii) who are
employees or consultants of the Seller at any time after the Closing Date; or
(iii) who were employees or consultants of the Seller at any time during the
six months prior to the Closing Date.

Section 6.11         Seekonk/Shrewsbury
Lease.

During
the Term (as defined in the Seekonk/Shrewsbury Lease) of the Seekonk/Shrewsbury
Lease, Seller will pay fifty percent (50%) of all Losses (as such Losses are
sustained or incurred) sustained or incurred arising out of the assertion
by the Lessor (as defined in the Seekonk/Shrewsbury Lease) under
Seekonk/Shrewsbury Lease that either the consummation of the transactions
contemplated by this Agreement constitutes a default by the Lessee (as defined
in the Seekonk/Shrewsbury Lease) under the Seekonk/Shrewsbury Lease or that a
change in the use of the premises from a “Vinny T’s” restaurant to another
restaurant concept constitutes a default by the Lessee under the
Seekonk/Shrewsbury Lease

ARTICLE VII

[Intentionally
Omitted]

ARTICLE VIII

[Intentionally
Omitted]

ARTICLE IX

Survival
And Indemnification

Section 9.1            Survival
of Representations, Warranties, Covenants and Agreements; Certain Limitations.

(a)           Notwithstanding
any otherwise applicable statute of limitations, but subject to Section 9.6
below, the representations and warranties included or provided for herein and
the Seller Estoppel Certificates will survive the Closing until one year after
the Closing Date; provided, however, that: (a) (i) any representation or
warranty contained in Sections 3.8 and 3.16 

 39
 

 

 

and (ii) any third party claim relating to such
representations and warranties, will survive the Closing until the expiration
of the applicable statute of limitations (including any waivers or extensions
thereof) with respect to such matters; and (b) (i) any representation and warranty
contained in Sections 3.1, 3.2, 3.3, 3.4, 3.7 (solely to the extent related to
title), 3.12, 3.21, 4.1, 4.2, 4.3 and Article V hereof (the “Purchase Price Cap
Representations and Warranties”) and (ii) any third party claim relating to
such representations and warranties, will survive the Closing until the
expiration of the applicable statute of limitations (including any waivers or
extensions thereof) with respect to such matters.  The covenants and other agreements contained
in this Agreement to be performed after Closing will survive the Closing until
the date or dates specified therein or the expiration of the applicable statute
of limitations (including any waivers or extensions thereof) with respect to
such matters, whichever is later.

(b)           Except with regard to the covenants
under Section 1.1 hereof, in no event will Buyer and Parent be liable to Seller
under Section 9.2 or Seller be liable to Buyer and Parent under Section 9.3,
until the aggregate amount of the indemnification obligation of the respective
party thereunder exceeds $100,000.00 (the “Basket”), at which point the Seller
or the Buyer (as applicable) shall be responsible for all Losses (as defined
below) above the value of the Basket.

(c)           Except with regard to the Purchase
Price Cap Representations and Warranties and the exceptions set forth in
Section 9.6, in no event will Buyer and Parent be liable to Seller under
Section 9.2 or Seller be liable to Buyer and Parent under Section 9.3, in an
amount exceeding $1,500,000.00.  With
regard to the Purchase Price Cap Representations and Warranties, in no event
will Buyer and Parent be liable to Seller under Section 9.2 or Seller be liable
to Buyer and Parent under Section 9.3, in an amount exceeding the Purchase
Price.

Section 9.2            Indemnification
by Buyer and Parent.

(a)           For the period commencing on the
Closing Date and ending, as the case may be, upon the expiration of the periods
specified in Section 9.1 hereof, Buyer and Parent will, subject to the
limitations set forth in Section 9.1 hereof, indemnify, defend and hold
harmless Seller and its Affiliates, and their respective directors, officers,
employees, shareholders, attorneys, accountants and agents (“Seller Indemnified
Parties”) against and in respect of all losses, damages, liabilities, costs and
expenses (including reasonable attorneys’ fees and expenses incurred in
investigating, preparing or defending any claims covered hereby, excluding,
however, any consequential and punitive damages, diminution in value and lost
profits except in the event of claims based on fraud as set forth in Section
9.6 below) (collectively, “Losses”) sustained or incurred arising out of any
breaches of Buyer’s and Parent’s representations, warranties, covenants and
agreements set forth in this Agreement (other than representations, warranties,
covenants and agreements set forth in Article V, as to which the
indemnification provisions set forth in Article V will govern).

(b)           Any payments due to Seller pursuant
to this Section 9.2 or Article V will be satisfied by the Buyer within 10 days
of the liability for such payment maturing in accordance with Section 9.5
hereof by wire transfer to an account designated by Seller in the Claim
Notice.  

 40
 

 

 

Any amounts paid under this Section 9.2 or Article V
will be treated as an adjustment to the Purchase Price for all Tax purposes.

Section 9.3            Indemnification
by Seller.

(a)           For the period commencing on the
Closing Date and ending, as the case may be, upon the expiration of the periods
specified in Section 9.1 hereof Seller will, subject to the limitations set
forth in Section 9.1 hereof, indemnify, defend and hold harmless Parent, Buyer
and their Affiliates, and their respective directors, officers, employees,
shareholders, attorneys, accountants and agents (“Buyer Indemnified Parties”
and, collectively with the Seller Indemnified Parties, the “Indemnified Parties”)
against and in respect of all Losses sustained or incurred arising out of any
breaches of Seller’s or the Company’s representations, warranties, covenants
and agreements set forth in this Agreement (other than representations,
warranties, covenants and agreements set forth in Article V, as to which the
indemnification provisions set forth in Article V will govern).

(b)        Any amounts due to Buyer pursuant to
this Section 9.3 or Article V will be satisfied (i) first by reducing the
outstanding principal balance of, and unpaid interest on, the Promissory Note,
and (ii) if there is no outstanding principal balance of, or unpaid interest
on, the Promissory Note, by the Seller, making payment within 10 days of the
liability for such payment maturing in accordance with in Section 9.5 by wire
transfer to an account designated by Buyer in the related Claim Notice.  Any amounts by which the Promissory Note is
reduced or that is paid under this Section 9.3 or Article V will be treated as
an adjustment to the Purchase Price for all Tax purposes.  In the
event of a required reduction in the principal amount of or interest under the
Promissory Note under this Section 9.3(b), Buyer and Seller covenant and agree
to execute an amendment to the Promissory Note within 10 days following the
date upon which the liability for such payment maturing in accordance
with in Section 9.5 occurs, such amendment
to reflect the required reduction and that no interest shall accrue (or shall
have ever accrued) on the amount of the required reduction, and such amendment
to be reasonably satisfactory in form and substance to Buyer and the Seller.

Section
9.4        Indemnification as Sole Remedy.

The
indemnity provided in Articles V and IX of this Agreement as it relates to this
Agreement and the transactions contemplated by this Agreement will be the sole
and exclusive remedy of the parties hereto, their Affiliates, successors and
assigns with respect to any and all claims for Losses sustained or incurred
arising out of this Agreement and the transactions contemplated by this
Agreement, provided however, that a breach of the covenant contained in
Section 6.11 hereof shall not be the sole and exclusive remedy of the parties
hereto.

Section 9.5            Method
of Asserting Claims, Etc.

All claims for indemnification by the Indemnified
Parties hereunder will be asserted and resolved as set forth in this Section
9.5 except for claims pursuant to Article V hereof (as to which the provisions
of Article V will be applicable).  In the
event that any written claim or 

 41
 

 

 

demand for which Buyer or Seller, as the case may be
(the “Indemnifying Party”), would be liable to any Indemnified Party hereunder
is asserted against or sought to be collected from any Indemnified Party by a
third party, such Indemnified Party will promptly, but in no event more than
ten days following such Indemnified Party’s receipt of such claim or demand,
notify the Indemnifying Party of such claim or demand and the amount or the
estimated amount thereof to the extent then feasible (which estimate will not
in any manner prejudice the right of the Indemnified Party to indemnification
to the fullest extent provided hereunder) (the “Third Party Claim Notice”) and
in the event that an Indemnified Party asserts a claim for indemnity under this
Article IX, not including a third party claim, the Indemnified Party will
notify the Indemnifying Party promptly following its discovery of the facts or
circumstances giving rise thereto (together, with a Third Party Claim Notice, a
“Claim Notice”); provided, that the failure to notify on the part of the
Indemnified Party in the manner set forth herein will not foreclose any rights
otherwise available to such Indemnified Party hereunder, except to the extent
that the Indemnifying Party is prejudiced by such failure to notify. The
Indemnifying Party will have thirty (30) days from the receipt of the Claim
Notice (except that such a period will be decreased to a time ten (10) days before
a scheduled appearance date in a litigated matter) (the “Notice Period”) to
notify the Indemnified Party whether or not the Indemnifying Party disputes the
liability of the Indemnifying Party to the Indemnified Party hereunder with
respect to such claim or demand. All costs and expenses incurred by the
Indemnifying Party in defending such claim or demand will be a liability of,
and will be paid by, the Indemnifying Party; provided, however, that the
amount of such expenses will be a liability of the Indemnifying Party
hereunder, subject to the limitations set forth in Section 9.1 hereof.  In the event that the Indemnifying Party
notifies the Indemnified Party within the Notice Period that it desires to
defend the Indemnified Party against such claim or demand (if it is a third
party claim), and except as hereinafter provided, the Indemnifying Party will
have the right to defend the Indemnified Party by appropriate proceedings and
by counsel reasonably acceptable to the Indemnified Party. If any Indemnified
Party desires to participate in, but not control, any such defense or
settlement it may do so at its sole cost and expense. The Indemnified Party
will not settle a claim or demand without the consent of the Indemnifying
Party, which consent may not be unreasonably withheld or delayed.  The Indemnifying Party may not, without the
prior written consent of the Indemnified Party, settle, compromise or offer to
settle or compromise any such claim or demand: (a) without obtaining an
unconditional and full release in favor of the Indemnified Party with regard to
such claim or demand, and (b) on a basis which would result in the imposition
of a Court Order which would restrict the future activity or conduct of, or
which would otherwise be reasonably likely to have a material adverse effect
on, the Indemnified Party or any subsidiary or Affiliate thereof. If the
Indemnifying Party elects not to defend the Indemnified Party against such
claim or demand, whether by not giving the Indemnified Party timely notice as provided
above or otherwise, then the amount of any such claim or demand, or, if the
same be contested by the Indemnified Party, then that portion of any such claim
or demand as to which such defense is unsuccessful (and all reasonable costs
and expenses pertaining to such defense) will be the liability of the
Indemnifying Party hereunder, subject to the limitations set forth in Section
9.1 hereof. To the extent the Indemnifying Party controls or participates in
the defense or settlement of any third party claim or demand, the Indemnified
Party will give to the Indemnifying Party and its counsel reasonable access to
all business records and other documents relevant to such defense or 

 42
 

 

 

settlement, and will permit them to consult with the
employees and counsel of the Indemnified Party. 
The Indemnified Party will use its commercially reasonable efforts in
the defense of all such claims, and in connection therewith will be entitled to
reimbursement by the Indemnifying Party of expenses directly related to efforts
undertaken at the specific request of the Indemnifying Party.

Section 9.6 
          Exceptions.

Nothing in this Agreement will affect or otherwise
limit: (a) the ability of any Indemnified Party to pursue an action against any
Indemnifying Party based on fraud; (b) the ability of Buyer to pursue an action
against the Seller for any Encumbrances or other liabilities relating to (i)
that certain Revolving Credit and Term Loan Agreement dated as of September 30,
2002 among the Seller, the Guarantors named therein, and Fleet National
Bank, as Administrative Agent with other lending institutions listed on
Schedule 1 to such agreement and SunTrust Bank, as Syndication Agent and (ii)
the UCC financing statements listed on Schedule 9.6 of the Disclosure
Schedules, which the Seller represents and warrants are the only UCC financing
statements filed by Fleet National Bank (or any of its Affiliates) relating to
the assets of the Company or the Business (the “Fleet Matters”); or (c) the
ability of Buyer to pursue an action against the Seller for a breach of Section
6.11 hereof.  Any claim based on: (x)
fraud or the Fleet Matters will be without respect to the limitations set forth
in Sections 9.1 and 9.4; or (y) a breach of Section 6.11 hereof will be without
respect to the limitations set forth in Section 9.1 and 9.4, provided
however, the Buyer’s right to pursue a claim based upon a breach of Section
6.11 shall terminate upon the termination of the Term (as defined in the
Seekonk/Shrewsbury Lease) of the Seekonk/Shrewsbury Lease.

Section 9.7            Effect
of Purchase Price Adjustment.

To
the extent that any Loss that would otherwise entitle a party to
indemnification hereunder (i) is reflected as a Current Liability in the Final
Report prepared in accordance with Section 2.1 of this Agreement, and (ii) the
inclusion of such Current Liability in the Final Report results in, or changes,
the amount of any adjustment under Section 2.2 hereof by the amount of such
Currently Liability, such Loss will not entitle such party to indemnification
hereunder.

ARTICLE X

Definitions

Section 10.1         Specific
Definitions.

As
used in this Agreement, the following terms have the meanings set forth or
referenced below:

“2004/2005
Statements” has the meaning set forth in Section 3.5.

“2006
Statement” has the meaning set forth in Section 3.5.

 43
 

 

 

“Acquisition
Transaction” means any sale, merger, consolidation or other business
combination involving the Company or the Business, acquisition of capital stock
of either of the Company or the Seller (which would affect the ownership of the
Business), sale of assets used in connection with the Business or inquiries or
proposals concerning, or which could reasonably be expected to lead to, any of
the foregoing.

“Action”
has the meaning set forth in Section 6.6(a).

“Affiliate”,
as applied to any Person, means any other Person directly or indirectly
controlling, controlled by or under common control with such Person.

“Agreement”
means this Agreement and all Schedules and Exhibits to this Agreement.

“Ancillary
Agreements” has the meaning set forth in Section 3.1.

“Balance
Sheet” has the meaning set forth in Section 3.5.

“Balance
Sheet Date” has the meaning set forth in Section 3.5.

“Balance
Sheets” has the meaning set forth in Section 3.5.

“Basket”
has the meaning set forth in Section 9.1(b).

“BB&T”
has the meaning set forth in Section 3.21.

“Business”
has the meaning set forth in the recitals of this Agreement.

“Business
Day” means any day other than a Saturday, a Sunday or a day on which banks in
the city of Minneapolis, MN are authorized or obligated by law or executive
order to close.

“Buyer”
has the meaning set forth in the first paragraph of this Agreement.

“Buyer
Indemnified Parties” has the meaning set forth in Section 9.3(a).

“BUCA
Credit Agreement” has the meaning set forth in Section 1.2.

“Cash
Payment” has the meaning set forth in Section 1.1(b)(i).

“Claim
Notice” has the meaning set forth in Section 9.5.

“Closing”
has the meaning set forth in Section 1.2.

“Closing
Current Liabilities” has the meaning set forth in Section 2.1.

“Closing
Date” has the meaning set forth in Section 1.2.

 44
 

 

 

“CPA”
has the meaning set forth in Section 2.1(b).

“Code”
means the Internal Revenue Code of 1986, as amended.

“Company”
has the meaning set forth in the first paragraph of this Agreement.

“Company
Plans” has the meaning set forth in Section 3.15(b).

“Company
Releases” has the meaning set forth in Section 1.3(h)

“Contracts”
has the meaning set forth in Section 3.1.

“Court
Order” means a court order, judgment, administrative or judicial order, writ,
decree, stipulation, arbitration award or injunction.

“Current
Liabilities” has the meaning set forth in Section 2.1(a)(ii).

“D/B/A
Contracts” has the meaning set forth in Section 3.10(b).

“Dedham
K&L” has the meaning set forth in Section 1.3(i).

“Dedham
Shares” has the meaning set forth in Section 3.4. 

“Disclosure
Schedules” has the meaning set forth in the first paragraph of Article III.

“Encumbrances”
has the meaning set forth in Section 3.3.

“Enforcement
Exceptions” has the meaning set forth in Section 3.1.

“Environmental
Law” means any law, regulation, code, license, permit, order, judgment, decree
or injunction of the United States, any State or political subdivision thereof
(including any court thereof and any Governmental Entity) relating primarily to
the protection of the environment (including air, water, soil and natural
resources) or the use, storage, handling, release or disposal of any hazardous
or toxic substance as in effect on the date hereof.

“Environmental
Site” means any properties or facilities currently or, to the Knowledge of the
Seller and the Company, formerly owned or leased by the Company or any
predecessor in interest of the Company.

“ERISA”
has the Employee Retirement Income Security Act of 1974, as amended.

“Final
Report” has the meaning set forth in Section 2.1(b).

“Final
Report Date” has the meaning set forth in Section 2.1(b).

“Financial
Statements” has the meaning set forth in Section 3.5.

 45
 

 

 

“Fleet
Matters” has the meaning set forth in Section 9.6.

“Former
Real Property” means any real properties that, to the Knowledge of the Seller
or the Company, were formerly owned or leased by the Company.

“GAAP”
means United States generally accepted accounting principles.

“Government
Authorizations” means any license, permit, order, franchise agreement,
concession, grant, authorization, consent or approval from a Governmental
Entity, including, but not limited to, liquor licenses.

“Governmental
Entity” means any governmental or regulatory authority, agency, commission,
body or other governmental entity of the United States of America or any State
or political subdivision thereof.

“Guaranty”
has the meaning set forth in Section 1.3(m).

“Hazardous
Materials” means any substance, material or waste which is regulated by an
Environmental Law, including, without limitation, any material or substance
which is defined as a “hazardous waste,” “hazardous material,” “hazardous
substance,” “extremely hazardous waste” or “restricted hazardous waste,” “subject
waste,” “contaminant,” “toxic waste” or “toxic substance” under any provision
of Environmental Law, including, but not limited to, petroleum products,
asbestos and polychlorinated biphenyls.

“Income
Statements” has the meaning set forth in Section 3.5.

“Indemnified
Party” has the meaning set forth in Section 9.3(a).

“Indemnifying
Party” has the meaning set forth in Section 9.5.

“Intellectual
Property” means trademarks, trademark applications, service marks, service mark
applications, trade dress, trade secrets, inventions, patents, patent applications,
computer software, copyrights, menus, signage, décor, operating processes and
procedures, food preparation and ingredients lists, recipes, know-how and
manner and method of operation related to the “Vinny T” restaurant concept, and
any other property or intellectual property of any Person.

“IRS”
means the Internal Revenue Service.

“Knowledge”
means (i) with respect to the Company, the actual knowledge of the Company,
arising after due inquiry of Roger Dubois and the Company’s executive officers,
but without the conduct by the Company of any independent investigation with
respect to the facts or matters specified (ii) with respect to Seller, the
actual knowledge of Seller, arising after due inquiry of Seller’s Chief
Financial Officer and Seller’s General Counsel, but without the conduct by
Seller of any independent investigation with respect to the facts or matters
specified (iii) 

 46
 

 

 

respect to any other Person, the actual knowledge of
such other Person, arising after due inquiry of such other Person’s executive
officers, but without the conduct by such other Person of any independent
investigation with respect to the facts or matters specified.

“Law”
has the meaning set forth in Section 3.1.

“Leased
Real Property” has the meaning set forth in Section 3.7(b).

“Liability”
means any liability, indebtedness, or obligation, whether accrued, absolute or
contingent, liquidated or unliquidated, matured or unmatured, or otherwise.

“Losses”
has the meaning set forth in Section 9.2(a).

“Major
Marks” has the meaning set forth in Section 3.13(b).

“Material
Adverse Effect” means a material adverse effect on the business, financial
condition (financial or otherwise), properties, assets, liabilities, operations
or results of operations of the Company or the Business, excluding, however, (a) the reaction (including subsequent
actions) of third parties to the transactions contemplated herein;
(b) conditions generally affecting the industries in which such Person
operates or the U.S. economy as a whole; (c) national or international
political or social conditions, including the engagement by the United States
in, or escalation of, hostilities, whether or not pursuant to the declaration
of a national emergency or war, or the occurrence of any military or terrorist
attack upon the United States or any of its territories, possessions or
diplomatic or consular offices or upon any military installation, equipment or
personnel of the United States; (d) financial, banking or securities
markets (including any disruption thereof and any decline in the price of any
security or any market index); (e) the
payment of any amounts due to, or the provision of any other benefits
(including employee benefits or payments to employees) to, any officers or
employees under employment contracts, non-competition agreements,
employee benefit plans, severance arrangements or other arrangements in
existence on the date hereof; (f) compliance with the terms of, or the
taking of any action required by, this Agreement; or (g) any change in
GAAP or other accounting requirement or principle or any change in applicable
Law or the interpretation thereof; (h) any action required to be taken
under applicable Law.

“Maximum
Net Working Capital” has the meaning set forth in Section 2.2(a).

“Minimum
Net Working Capital” has the meaning set forth in Section 2.2(a).

“Net
Working Capital” has the meaning set forth in Section 2.2(a).

“Non-Cash
Current Assets” has the meaning set forth in Section 2.1(a)(i).

“Notice
Period” has the meaning set forth in Section 9.5.

“Parent”
has the meaning set forth in the first paragraph of this Agreement.

 47
 

 

 

“Parent
2004/2005 Statements” has the meaning set forth in Section 4.4.

“Parent
2006 Statements” has the meaning set forth in Section 4.4.

“Parent
Financial Statements” has the meaning set forth in Section 4.4.

“Person”
means any individual, corporation, partnership, firm, joint venture,
association, joint-stock company, trust, unincorporated organization, entity or
Governmental Entity.

“Preliminary
Report” has the meaning set forth in Section 2.1(b).

“Promissory
Note” has the meaning set forth in Section 1.1(b)(ii).

“Purchase
Price” has the meaning set forth in Section 1.1.

“Purchase
Price Cap Representations and Warranties” has the meaning set forth in Section
9.1(a).

“Real
Property Leases” has the meaning set forth in Section 3.7(b). 

“Securities
Act” means the Securities Act of 1933, as amended.

“Seekonk/Shrewsbury
Lease” means that certain Commercial Property Lease dated February 2, 2001 for
property located at 7 Boston Turnpike, Shrewsbury, Massachusetts and 353
Highland Ave., Seekonk, Massachusetts.

“Seller”
has the meaning set forth in the first paragraph of this Agreement.

“Seller
Estoppel Certificates” has the meaning set forth in Section 6.4.

“Seller
Indemnified Parties” has the meaning set forth in Section 9.2(a).

“Seller
Subject Employees” has the meaning set forth in Section 6.9(b).

“Seller’s
Group” means any “affiliated group” (as defined in Section 1504(a) of the Code
without regard to the limitations contained in Section 1504(b) of the Code)
that includes Seller and the Company.

“Settlement”
has the meaning set forth in Section 6.6(b).

“Shares”
has the meaning set forth in Section 1.1.

“Subject
Employees” has the meaning set forth in Section 6.10(a).

“Tax
Package” has the meaning set forth in Section 5.3.

 48

 

 

“Tax
Returns” means all federal, state, local or foreign tax returns, tax reports,
and declarations of estimated tax, including, without limitation, consolidated
federal income tax returns of Seller’s Group.

“Taxes”
means all federal, state, local or foreign income, gross receipts, windfall or
excess profits, severance, property, production, sales, use, license, excise,
franchise, employment, withholding or similar taxes, together with any
interest, additions or penalties with respect thereto and any interest in
respect of such additions or penalties.

“Third
Party Claim Notice” has the meaning set forth in Section 9.5.

“Transfer
Taxes” has the meaning set forth in Section 5.2.

“Transition
Services Agreement” has the meaning set forth in Section 1.3(p).

“WFF”
has the meaning set forth in Section 1.2.

Section 10.2         Other
Terms.

Other
terms may be defined elsewhere in the text of this Agreement and, unless
otherwise indicated, have such meaning indicated throughout this Agreement.

Section 10.3         Other
Definitional Provisions.

(a)           The words “hereof”, “herein”, and “hereunder”
and words of similar import, when used in this Agreement, refer to this
Agreement as a whole and not to any particular provision of this Agreement.

(b)           The terms defined in the singular
have a comparable meaning when used in the plural, and vice versa.

(c)           The terms “dollars” and “$” mean
United States dollars.

ARTICLE
XI

Miscellaneous

Section 11.1         Amendment
and Waiver.

Any
provision of this Agreement may be amended or waived if, and only if, such
amendment or waiver is in writing and signed, in the case of an amendment, by
Seller, Parent and Buyer, or in the case of a waiver, by the party against whom
the waiver is to be effective. No failure or delay by any party in exercising
any right, power or privilege hereunder will operate as a waiver thereof nor
will any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.

 49
 

 

 

Section 11.2         Expenses.

Except as otherwise expressly provided in this
Agreement, whether or not the transactions contemplated by this Agreement are
consummated, the parties will bear their own respective costs and expenses
(including, but not limited to, all compensation and expenses of counsel, financial
advisors, consultants, actuaries and independent accountants) incurred in
connection with this Agreement and the transactions contemplated hereby.

Section 11.3         Confidentiality.

Seller
and the Company (which for purposes of this Section 11.3 will be considered
collectively as a party) and Parent and Buyer (which for purposes of this
Section 11.3 will be considered collectively as a party) will maintain in
confidence, and will cause their respective directors, officers, employees,
agents, and advisors to maintain in confidence, and not use to the detriment of
another party any written, oral, or other information obtained in confidence
from another party in connection with this Agreement or the transactions
contemplated hereby, unless: (a) such information is already known to such
party or to others not bound by a duty of confidentiality or such information
becomes publicly available through no fault of such party, (b) the use of such
information is necessary or appropriate in making any filing or obtaining any
consent or approval required for the consummation of the transactions
contemplated hereby, (c) the furnishing or use of such information is required
by legal proceedings, provided that the party who desires to disclose
such information provides 14 days written notice to the party whose information
is to be disclosed prior to the date of such disclosure, or (d) as set forth in
Section 11.4.  If the transactions
contemplated hereby are not consummated, each party will return or destroy all
written information as the other party may reasonably request.  Each party agrees to comply with this Section
11.3 at all times (including at any time prior to the Closing) and this Section
11.3 will survive the termination of this Agreement, provided however,
if the transactions contemplated by this Agreement are consummated, then the
obligations contained in this Section 11.3 shall not apply to Parent or Buyer.

Section 11.4         Public
Disclosure.

(a)           Each
of the parties to this Agreement hereby agrees with the other parties hereto
that, except as may be required to comply with the requirements of applicable
law or the rules and regulations of each stock market or stock exchange, as
applicable, upon which the securities of one of the parties or its Affiliates
is listed, no press release or similar public announcement or communication
will be made or caused to be made concerning the execution or performance of
this Agreement unless specifically approved in advance by all parties hereto; provided,
however, that to the extent that either party to this Agreement is required
by law or the rules and regulations of any stock market or stock exchange, as
applicable, upon which the securities of one of the parties or its Affiliates
is listed to make such a public disclosure, such public disclosure will only be
made after prior consultation with the other party to this Agreement.

(b)           Notwithstanding Section 11.4(a)
above, each party hereby acknowledges that Seller may, without prior
consultation with Buyer, file a copy of the Agreement (but not the 

 50
 

 

 

Schedules to this Agreement, unless required by the
Securities and Exchange Commission) with the Securities and Exchange Commission
upon execution of the Agreement by all parties.

Section 11.5         Assignment.

No
party to this Agreement may assign any of its rights or obligations under this
Agreement without the prior written consent of the other party hereto, provided
however, that the Buyer may assign any of its rights and obligations under
this Agreement or in any agreement, document or instrument executed and
delivered pursuant hereto or in connection with the Closing (without the prior
written consent of the Seller or the Company) to one or more Affiliates of the
Buyer, so long as the obligations of Parent under the Guaranty will apply to
such Affiliate of Buyer.

Section 11.6         Entire
Agreement.

This
Agreement and the Ancillary Agreements (including all Exhibits and Schedules
hereto and thereto) contain the entire agreement between the parties hereto
with respect to the subject matter hereof and supersedes all prior agreements
and understandings, oral or written, with respect to such matters.

Section 11.7         Fulfillment
of Obligations.

Any
obligation of any party to any other party under this Agreement, which
obligation is performed, satisfied or fulfilled by an Affiliate of such party,
will be deemed to have been performed, satisfied or fulfilled by such party.

Section 11.8         Parties
in Interest; No Third Party Beneficiaries.

This
Agreement will inure to the benefit of and be binding upon the parties hereto
and their respective successors and permitted assigns. Nothing in this
Agreement, express or implied, is intended to confer upon any Person other than
Buyer, Parent, Seller, or their successors or permitted assigns, any rights or
remedies under or by reason of this Agreement.

Section 11.9         Schedules.

A
disclosure made by Seller or the Company in any section of this Agreement or
any section of the Disclosure Schedules will expressly not be deemed to
constitute an admission by Seller or the Company, or otherwise imply, that any
such matter is material or creates a measure for materiality for the purposes
of this Agreement. 

Section 11.10       Interpretation.

The parties hereto acknowledge and agree that: (a) each party and its
counsel reviewed and negotiated the terms and provisions of this Agreement and
the Ancillary Agreements and have contributed to their revision; (b) the rule
of construction to the effect that any ambiguities 

 51
 

 

 

are resolved against the drafting party shall not be
employed in the interpretation of this Agreement; and (c) the terms and
provisions of this Agreement shall be construed fairly as to all parties hereto
and not in favor of or against any party, regardless of which party was
generally responsible for the preparation of this Agreement.

Section 11.11       Counterparts.

This
Agreement and any amendments hereto may be executed in one or more
counterparts, each of which will be deemed to be an original by the parties
executing such counterpart, but all of which will be considered one and the
same instrument.

Section 11.12       Section
Headings.

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

Section 11.13       Notices.

All
notices hereunder will be deemed given if in writing and delivered personally
or sent by facsimile or by nationally recognized overnight courier to the
parties at the following addresses (or at such other addresses as will be
specified by like notice):

(a)           if to Seller or, prior to Closing,
the Company, to:

BUCA, Inc.

1300 Nicollet Mall

Suite 5003

Minneapolis, MN  55403

Attention: Richard G. Erstad

Facsimile No.:  612-225-3586

With a copy to:

Faegre & Benson LLP

2200 Wells Fargo Center

90 South Seventh Street

Minneapolis, MN 55402

Attention: Douglas P. Long

Facsimile No.:  612-766-1600

 52
 

 

 

(b)           if to Buyer or Parent or, after the
Closing, the Company, to:

Bertucci’s Corporation

155 Otis Street

Northborough, MA 01532

Attn: David G. Lloyd

Facsimile No.: (508) 393-8406

With a copy to:

Brown Rudnick Berlack
Israels LLP
One Financial Center

Boston, MA 02111

Attn: Carl Axelrod

Facsimile No.: (617) 856-8201

Any
notice given by nationally recognized overnight courier will be deemed to be received
one Business Day after deposit with such overnight courier.  Any notice given by facsimile shall be deemed
to have been received on the day when sent, provided however, if the
facsimile is sent after 5:00 p.m. (EST) on a Business Day or is not sent on a
Business Day, then it shall be deemed to have been received on the next
Business Day.

Section 11.14       Governing
Law.

The validity,
interpretation and effect of this Agreement will be governed exclusively by the
laws of the State of Minnesota, without giving effect to any conflict of law
provision thereof.

Section 11.15       Severability.

The
provisions of this Agreement will be deemed severable and the invalidity or
unenforceability of any provision will not affect the validity or
enforceability of the other provisions hereof. 
If any provision of this Agreement, or the application thereof to any
person or entity or any circumstance, is invalid or unenforceable, (a) a
suitable and equitable provision will be substituted therefor in order to carry
out, so far as may be valid and enforceable, the intent and purpose of such
invalid or unenforceable provision and (b) the remainder of this Agreement and
the application of such provision to other persons, entities or circumstances
will not be affected by such invalidity or unenforceability.

[Signature Page to Follow]

 53

 

 

IN
WITNESS WHEREOF, this Stock Purchase Agreement has been signed on behalf of
each of the parties hereto as of the date first written above.

	
  

  	
   

  	
  BUCA, INC.

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Wallace B. Doolin

  
	
   

  	
   

  	
   

  	
   

  	
  Wallace B. Doolin

  
	
   

  	
   

  	
   

  	
   

  	
  Chairman, President and Chief Executive Officer

  
	
   

  	
   

  	
  BUCA RESTAURANTS 3, INC.

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Wallace B. Doolin

  
	
   

  	
   

  	
   

  	
   

  	
  Wallace B. Doolin

  
	
   

  	
   

  	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  	
  BERTUCCI’S CORPORATION

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stephen V. Clark

  
	
   

  	
   

  	
   

  	
   

  	
  Stephen V. Clark

  
	
   

  	
   

  	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  	
  VINNY T’S ACQUISITION
  CORPORATION

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stephen V. Clark

  
	
   

  	
   

  	
   

  	
   

  	
  Stephen V. Clark

  
	
   

  	
   

  	
   

  	
   

  	
  President

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