Document:

Exhibit 10.3

 

EXECUTION VERSION

 

 

 

 

CREDIT AGREEMENT

 

 

dated as of October 31, 2010

 

among

 

TITAN MACHINERY INC.

a Delaware corporation,

as Borrower,

 

THE SUBSIDIARIES OF BORROWER PARTY HERETO,

as Subsidiary Guarantors,

 

THE FINANCIAL INSTITUTIONS PARTY HERETO,

as Lenders,

 

BANK OF AMERICA, N.A.

as Co-Documentation Agent

 

COBANK,  ACB

as Co-Documentation Agent

 

and

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Administrative Agent,

Swing Line Lender and L/C Issuer

 

 

WELLS FARGO SECURITIES, LLC

Sole Lead Arranger and Sole Book Runner

 

 

 

 

TABLE OF CONTENTS

 

	
  ARTICLE I

  	
  CERTAIN DEFINED TERMS; CERTAIN RULES OF CONSTRUCTION

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 1.01

  	
   

  	
  CERTAIN DEFINED TERMS

  	
  1

  
	
  SECTION 1.02

  	
   

  	
  CERTAIN RULES OF CONSTRUCTION

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
  CREDIT EXTENSIONS

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 2.01

  	
   

  	
  WORKING CAPITAL LOANS; FLOORPLAN LOANS

  	
  35

  
	
  SECTION 2.02

  	
   

  	
  PROCEDURES FOR BORROWING

  	
  36

  
	
  SECTION 2.03

  	
   

  	
  LETTERS OF CREDIT

  	
  38

  
	
  SECTION 2.04

  	
   

  	
  SWING LINE LOANS

  	
  45

  
	
  SECTION 2.05

  	
   

  	
  PAYMENTS AND PREPAYMENTS

  	
  49

  
	
  SECTION 2.06

  	
   

  	
  TERMINATION OR REDUCTION OF AGGREGATE COMMITMENTS

  	
  51

  
	
  SECTION 2.07

  	
   

  	
  FINAL REPAYMENT OF LOANS

  	
  52

  
	
  SECTION 2.08

  	
   

  	
  INTEREST; APPLICABLE RATES

  	
  52

  
	
  SECTION 2.09

  	
   

  	
  FEES

  	
  54

  
	
  SECTION 2.10

  	
   

  	
  COMPUTATIONS OF INTEREST AND FEES

  	
  55

  
	
  SECTION 2.11

  	
   

  	
  EVIDENCE OF DEBT

  	
  55

  
	
  SECTION 2.12

  	
   

  	
  PAYMENTS GENERALLY; RIGHT OF ADMINISTRATIVE AGENT TO MAKE
  DEDUCTIONS AUTOMATICALLY

  	
  55

  
	
  SECTION 2.13

  	
   

  	
  SHARING OF PAYMENTS

  	
  57

  
	
  SECTION 2.14

  	
   

  	
  INCREASE IN AGGREGATE COMMITMENTS

  	
  58

  
	
  SECTION 2.15

  	
   

  	
  SECURITY FOR THE OBLIGATIONS

  	
  60

  
	
  SECTION 2.16

  	
   

  	
  EXTENSION OF MATURITY DATE

  	
  60

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
  TAXES, YIELD PROTECTION AND ILLEGALITY

  	
  61

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3.01

  	
   

  	
  TAXES

  	
  61

  
	
  SECTION 3.02

  	
   

  	
  ILLEGALITY

  	
  63

  
	
  SECTION 3.03

  	
   

  	
  INABILITY TO DETERMINE RATES

  	
  63

  
	
  SECTION 3.04

  	
   

  	
  INCREASED COSTS

  	
  64

  
	
  SECTION 3.05

  	
   

  	
  COMPENSATION FOR LOSSES

  	
  65

  
	
  SECTION 3.06

  	
   

  	
  MITIGATION OBLIGATIONS; ADDITIONAL L/C ISSUER

  	
  66

  
	
  SECTION 3.07

  	
   

  	
  REMOVAL OR REPLACEMENT OF LENDERS

  	
  66

  
	
  SECTION 3.08

  	
   

  	
  SURVIVAL

  	
  68

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
  CONDITIONS PRECEDENT

  	
  68

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4.01

  	
   

  	
  CONDITIONS TO EFFECTIVENESS AND INITIAL CREDIT EXTENSION

  	
  68

  
	
  SECTION 4.02

  	
   

  	
  CONDITIONS TO ALL CREDIT EXTENSIONS

  	
  71

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
  REPRESENTATIONS AND WARRANTIES

  	
  72

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5.01

  	
   

  	
  CORPORATE EXISTENCE AND POWER

  	
  72

  
	
  SECTION 5.02

  	
   

  	
  CORPORATE AUTHORIZATION; NO CONTRAVENTION

  	
  72

  
	
  SECTION 5.03

  	
   

  	
  GOVERNMENTAL AUTHORIZATION; COMPLIANCE WITH LAWS

  	
  72

  
	
  SECTION 5.04

  	
   

  	
  BINDING EFFECT

  	
  73

  

 

1

 

	
  SECTION 5.05

  	
   

  	
  LITIGATION

  	
  73

  
	
  SECTION 5.06

  	
   

  	
  NO DEFAULTS

  	
  73

  
	
  SECTION 5.07

  	
   

  	
  EMPLOYEE BENEFIT PLANS

  	
  74

  
	
  SECTION 5.08

  	
   

  	
  USE OF PROCEEDS

  	
  74

  
	
  SECTION 5.09

  	
   

  	
  TITLE TO PROPERTIES

  	
  74

  
	
  SECTION 5.10

  	
   

  	
  TAXES

  	
  74

  
	
  SECTION 5.11

  	
   

  	
  FINANCIAL CONDITION

  	
  75

  
	
  SECTION 5.12

  	
   

  	
  ENVIRONMENTAL MATTERS

  	
  75

  
	
  SECTION 5.13

  	
   

  	
  MARGIN REGULATIONS; REGULATED ENTITIES

  	
  75

  
	
  SECTION 5.14

  	
   

  	
  SWAP OBLIGATIONS

  	
  76

  
	
  SECTION 5.15

  	
   

  	
  INTELLECTUAL PROPERTY

  	
  76

  
	
  SECTION 5.16

  	
   

  	
  EQUITY INTERESTS HELD BY BORROWER; EQUITY INTERESTS IN
  BORROWER

  	
  76

  
	
  SECTION 5.17

  	
   

  	
  INSURANCE

  	
  76

  
	
  SECTION 5.18

  	
   

  	
  COLLATERAL AND COLLATERAL DOCUMENTS

  	
  77

  
	
  SECTION 5.19

  	
   

  	
  LABOR RELATIONS

  	
  77

  
	
  SECTION 5.20

  	
   

  	
  SOLVENCY

  	
  78

  
	
  SECTION 5.21

  	
   

  	
  FULL DISCLOSURE

  	
  78

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
  AFFIRMATIVE COVENANTS

  	
  78

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6.01

  	
   

  	
  FINANCIAL STATEMENTS

  	
  78

  
	
  SECTION 6.02

  	
   

  	
  CERTIFICATES; OTHER INFORMATION

  	
  79

  
	
  SECTION 6.03

  	
   

  	
  NOTICES

  	
  80

  
	
  SECTION 6.04

  	
   

  	
  PAYMENT OF CERTAIN OBLIGATIONS

  	
  81

  
	
  SECTION 6.05

  	
   

  	
  PRESERVATION OF
  EXISTENCE, ETC.

  	
  81

  
	
  SECTION 6.06

  	
   

  	
  MAINTENANCE OF PROPERTIES

  	
  82

  
	
  SECTION 6.07

  	
   

  	
  MAINTENANCE OF INSURANCE

  	
  82

  
	
  SECTION 6.08

  	
   

  	
  COMPLIANCE WITH LAWS

  	
  82

  
	
  SECTION 6.09

  	
   

  	
  BOOKS AND RECORDS

  	
  82

  
	
  SECTION 6.10

  	
   

  	
  INSPECTION RIGHTS

  	
  83

  
	
  SECTION 6.11

  	
   

  	
  USE OF PROCEEDS

  	
  83

  
	
  SECTION 6.12

  	
   

  	
  FINANCIAL COVENANTS

  	
  83

  
	
  SECTION 6.13

  	
   

  	
  COLLATERAL VALUATIONS; COLLATERAL AUDITS

  	
  83

  
	
  SECTION 6.14

  	
   

  	
  FURTHER ASSURANCES

  	
  84

  
	
  SECTION 6.15

  	
   

  	
  LANDLORDS’ AGREEMENTS, MORTGAGEE AGREEMENTS, BAILEE LETTERS

  	
  84

  
	
  SECTION 6.16

  	
   

  	
  CONTROL AGREEMENTS

  	
  85

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
  NEGATIVE COVENANTS

  	
  85

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 7.01

  	
   

  	
  LIENS

  	
  85

  
	
  SECTION 7.02

  	
   

  	
  INVESTMENTS

  	
  87

  
	
  SECTION 7.03

  	
   

  	
  DEBT

  	
  88

  
	
  SECTION 7.04

  	
   

  	
  FUNDAMENTAL CHANGES

  	
  90

  
	
  SECTION 7.05

  	
   

  	
  DISPOSITIONS

  	
  91

  
	
  SECTION 7.06

  	
   

  	
  RESTRICTED PAYMENTS

  	
  91

  
	
  SECTION 7.07

  	
   

  	
  CAPITAL EXPENDITURES

  	
  92

  
	
  SECTION 7.08

  	
   

  	
  TRANSACTIONS WITH AFFILIATES

  	
  92

  
	
  SECTION 7.09

  	
   

  	
  BURDENSOME AGREEMENTS

  	
  92

  

 

2

 

	
  SECTION 7.10

  	
   

  	
  USE OF PROCEEDS

  	
  93

  
	
  SECTION 7.11

  	
   

  	
  CERTAIN GOVERNMENTAL REGULATIONS

  	
  93

  
	
  SECTION 7.12

  	
   

  	
  AMENDMENT OF MATERIAL DOCUMENTS

  	
  93

  
	
  SECTION 7.13

  	
   

  	
  DISQUALIFIED EQUITY INTERESTS

  	
  93

  
	
  SECTION 7.14

  	
   

  	
  TRANSPORTATION SOLUTIONS

  	
  93

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
  EVENTS OF DEFAULT AND REMEDIES

  	
  94

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 8.01

  	
   

  	
  EVENTS OF DEFAULT

  	
  94

  
	
  SECTION 8.02

  	
   

  	
  REMEDIES UPON EVENT OF DEFAULT

  	
  96

  
	
  SECTION 8.03

  	
   

  	
  APPLICATION OF FUNDS

  	
  96

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
  ADMINISTRATIVE AGENT

  	
  97

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 9.01

  	
   

  	
  APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT

  	
  97

  
	
  SECTION 9.02

  	
   

  	
  RIGHTS AS A LENDER

  	
  97

  
	
  SECTION 9.03

  	
   

  	
  EXCULPATORY PROVISIONS

  	
  98

  
	
  SECTION 9.04

  	
   

  	
  RELIANCE BY ADMINISTRATIVE AGENT

  	
  99

  
	
  SECTION 9.05

  	
   

  	
  DELEGATION OF DUTIES

  	
  99

  
	
  SECTION 9.06

  	
   

  	
  RESIGNATION OF ADMINISTRATIVE AGENT

  	
  99

  
	
  SECTION 9.07

  	
   

  	
  NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS

  	
  100

  
	
  SECTION 9.08

  	
   

  	
  NO OTHER DUTIES, ETC.

  	
  100

  
	
  SECTION 9.09

  	
   

  	
  ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM

  	
  101

  
	
  SECTION 9.10

  	
   

  	
  GUARANTY MATTERS

  	
  101

  
	
  SECTION 9.11

  	
   

  	
  COLLATERAL MATTERS

  	
  101

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
  GENERAL PROVISIONS

  	
  103

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 10.01

  	
   

  	
  AMENDMENTS, ETC.

  	
  103

  
	
  SECTION 10.02

  	
   

  	
  NOTICES; EFFECTIVENESS; ELECTRONIC COMMUNICATIONS

  	
  106

  
	
  SECTION 10.03

  	
   

  	
  NO WAIVER; CUMULATIVE REMEDIES

  	
  108

  
	
  SECTION 10.04

  	
   

  	
  EXPENSES; INDEMNITY; DAMAGE WAIVER

  	
  108

  
	
  SECTION 10.05

  	
   

  	
  PAYMENTS SET ASIDE

  	
  110

  
	
  SECTION 10.06

  	
   

  	
  SUCCESSORS AND ASSIGNS

  	
  110

  
	
  SECTION 10.07

  	
   

  	
  TREATMENT OF CERTAIN INFORMATION; CONFIDENTIALITY

  	
  113

  
	
  SECTION 10.08

  	
   

  	
  RIGHT OF SETOFF

  	
  114

  
	
  SECTION 10.09

  	
   

  	
  INTEREST RATE LIMITATION

  	
  114

  
	
  SECTION 10.10

  	
   

  	
  COUNTERPARTS; INTEGRATION; EFFECTIVENESS

  	
  114

  
	
  SECTION 10.11

  	
   

  	
  SURVIVAL OF REPRESENTATIONS AND WARRANTIES

  	
  115

  
	
  SECTION 10.12

  	
   

  	
  SEVERABILITY

  	
  115

  
	
  SECTION 10.13

  	
   

  	
  USA PATRIOT ACT NOTICE

  	
  115

  
	
  SECTION 10.14

  	
   

  	
  GUARANTY BY SUBSIDIARIES

  	
  115

  
	
  SECTION 10.15

  	
   

  	
  TIME OF THE ESSENCE

  	
  122

  
	
  SECTION 10.16

  	
   

  	
  GOVERNING LAW; JURISDICTION; ETC.

  	
  122

  
	
  SECTION 10.17

  	
   

  	
  WAIVER OF RIGHT TO JURY TRIAL

  	
  123

  

 

3

 

	
  SCHEDULES

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  1.01-A

  	
  Applicable
  Rates

  	
   

  
	
  1.01-B

  	
  Existing
  Facilities to be Paid Off

  	
   

  
	
  1.01-C

  	
  Existing
  Letters of Credit

  	
   

  
	
  2.01

  	
  Lenders;
  Commitments; Percentage Shares

  	
   

  
	
  5.05

  	
  Litigation

  	
   

  
	
  5.12

  	
  Environmental
  Matters

  	
   

  
	
  5.16

  	
  Equity
  Interests Held by Borrower; Equity Interests in Borrower

  	
   

  
	
  5.17

  	
  Insurance

  	
   

  
	
  5.18

  	
  Applicable
  Filing Offices

  	
   

  
	
  5.19

  	
  Labor
  Issues

  	
   

  
	
  7.01

  	
  Existing
  Liens

  	
   

  
	
  7.03

  	
  Existing
  Debt

  	
   

  
	
  7.13

  	
  Assets
  of Transportation Solutions

  	
   

  
	
  10.02

  	
  Administrative
  Agent’s Office; Certain Addresses for Notices

  	
   

  
	
   

  	
   

  	
   

  
	
  EXHIBITS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  A

  	
  Form of
  Assignment and Assumption

  	
   

  
	
  B

  	
  Form of
  Compliance Certificate

  	
   

  
	
  C

  	
  Form of
  Joinder Agreement

  	
   

  
	
  D

  	
  Form of
  Loan Notice

  	
   

  
	
  E

  	
  Form of
  Notes

  	
   

  
	
  F

  	
  Form of
  Swing Line Notice

  	
   

  
	
  G

  	
  Form of
  Security Agreement

  	
   

  
	
  H

  	
  Borrowing
  Base Certificate

  	
   

  

 

4

 

CREDIT AGREEMENT

 

This
CREDIT AGREEMENT, dated as of October 31,
2010, is among TITAN MACHINERY INC., a Delaware
corporation (“Borrower”), the Subsidiary
Guarantors party hereto, the several financial institutions party to this
Agreement as Lenders, BANK OF AMERICA, N.A. and COBANK,  ACB, as
Co-Documentation Agents and WELLS FARGO BANK, NATIONAL
ASSOCIATION, a national banking association, as Administrative
Agent, Swing Line Lender and L/C Issuer.

 

RECITALS

 

WHEREAS
Borrower and Guarantors have requested that Lenders, Swing Line Lender and
L/C Issuer make available to Borrower the extensions of credit referenced
herein on the terms and conditions contained herein; and

 

WHEREAS
Lenders, Swing Line Lender and L/C Issuer have agreed severally to make
available to Borrower the extensions of credit referenced herein on the terms
and conditions contained herein; and

 

NOW,
THEREFORE, in consideration of the mutual agreements, provisions and covenants
contained herein and for other good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), the parties agree as follows:

 

AGREEMENT

 

ARTICLE I

CERTAIN DEFINED TERMS; CERTAIN RULES OF CONSTRUCTION

 

SECTION 1.01                               CERTAIN
DEFINED TERMS.

 

As
used herein:

 

“Acquiree”
has the meaning ascribed thereto in the definition of “Permitted
Acquisition” contained herein.

 

“Acquisition” means any transaction
or series of related transactions resulting, directly or indirectly, in:  (a) the acquisition by any Person
of:  (i) all or substantially all of
the assets of another Person; or (ii) any business unit or division of
another Person; (b) the acquisition by any Person of in excess of 50.00%
of the Equity Interests of any other Person, or otherwise causing any other
Person to become a Subsidiary of such Person; or (c) a merger or
consolidation, or any other combination, of any Person with another Person
(other than a Person that is a wholly-owned Subsidiary) in which Borrower or a
Subsidiary of Borrower is the surviving Person.

 

“Act” means the USA Patriot Act
(Title III of Pub. L. 107-56 (signed into law October 26, 2001)).

 

 

“Additional Commitment Documentation”
has the meaning ascribed thereto in Section 2.14(c).

 

“Additional Commitments Effective Date”
has the meaning ascribed thereto in Section 2.14(b).

 

“Additional Floorplan Commitment”
means the commitment of an Additional Floorplan Lender to make Additional
Floorplan Loans pursuant to Section 2.14.

 

“Additional Floorplan Lender” means,
at any time, any lender providing an Additional Floorplan Commitment.

 

“Additional Floorplan Loans” means
any loans made in respect of Additional Floorplan Commitments.

 

“Additional Working Capital Commitment”
means the commitment of an Additional Working Capital Lender to make Additional
Working Capital Loans pursuant to Section 2.14.

 

“Additional Working Capital Lender”
means, at any time, any lender providing an Additional Working Capital
Commitment.

 

“Additional Working Capital Loans”
means any loans made in respect of Additional Working Capital Commitments.

 

“Administrative Agent” means, at any
time, the administrative agent for the Lending Parties under each of the Loan
Documents (which, initially, shall be Wells Fargo).

 

“Administrative Agent’s Office” means
Administrative Agent’s address and, as appropriate, account as set forth on Schedule 10.02, or such other address or account as
Administrative Agent may from time to time notify Borrower, Guarantors and each
Lending Party.

 

“Administrative Detail Form” means an
administrative detail form in a form supplied by, or otherwise acceptable to,
Administrative Agent.

 

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

 

“Aggregate Commitments” means, at any
time, the sum of: (a) the Aggregate Working Capital Commitments; plus (b) the Aggregate Floorplan Commitments.

 

“Aggregate Floorplan Commitments”
means, at any time, the combined Floorplan Commitments of all Floorplan
Lenders.

 

“Aggregate Working Capital Commitments”
means, at any time, the combined Working Capital Commitments of all Working
Capital Lenders.

 

“Agreement” means this Credit
Agreement.

 

2

 

“Applicable Base Rate Margin” means,
at any time, the applicable percentage per annum (expressed in basis points)
set forth on Schedule 1.01-A for  Base Rate Loans.

 

“Applicable LIBOR Margin” means, at
any time, the applicable percentage per annum (expressed in basis points) set
forth on Schedule 1.01-A for Eurodollar
Rate Loans.

 

“Applicable Rate” means, at any time,
the applicable percentage per annum (expressed in basis points) set forth on Schedule 1.01-A, each such percentage being based,
subject to Section 2.08(d), upon the
Consolidated Leverage Ratio as set forth in the most recent Compliance
Certificate received by Administrative Agent pursuant to Section 4.01(a)(xii) or
Section 6.02(b), as applicable.  If the Borrower fails to provide the
Compliance Certificate as required by Section 6.02(b),
the Consolidated Leverage Ratio shall be deemed to be 2.01:1.00 from the date
on which such Compliance Certificate was due, as applicable, until such time as
such Compliance Certificate is delivered to the Administrative Agent, as
applicable.  Notwithstanding the
foregoing, in the event that a Compliance Certificate delivered pursuant to Section 6.02(b) is inaccurate (regardless of
whether (i) this Agreement is in effect, or (ii) the Working Capital
Commitments are in effect, (iii) the Floorplan Commitments are in effect
or (iv) any Credit Extension is outstanding when such inaccuracy is
discovered or such Compliance Certificate was delivered), and such inaccuracy,
if corrected, would have led to the application of a higher Applicable Rate for
any period (an “Applicable Period”) than the
Applicable Rate applied for such Applicable Period, then (x) the Borrower
shall immediately deliver to the Administrative Agent a corrected Compliance
Certificate for such Applicable Period, (y) the Applicable Rate for such
Applicable Period shall be determined as if the Consolidated Leverage Ratio in
the corrected Compliance Certificate were applicable for such Applicable
Period, and (z) the Borrower shall immediately pay to the Administrative
Agent the accrued additional interest and fees owing as a result of such
increased Applicable Rate for such Applicable Period, which payment shall be
promptly applied by the Administrative Agent in accordance with Section 2.12. 
Nothing in this paragraph shall limit the rights of the Administrative
Agent and Lenders with respect to Section 2.08(b) and
Section 8.01, provided that
payment of any amounts due under the previous sentence shall cure any Default
and Event of Default resulting from any such inaccurate Compliance Certificate
(but not any underlying financial covenant or other default).

 

“Arranger” means Wells Fargo
Securities, LLC as sole lead arranger and sole book runner for the transactions
contemplated by the Loan Documents.

 

“Asset Sale”
means any direct or indirect Disposition (whether in one transaction or a
series of related transactions) by Borrower or any Subsidiary thereof to any
Person other than Borrower or any wholly-owned Subsidiary thereof of:  (a) any Equity Interests of any
Subsidiary of Borrower; or (b) any other property of Borrower or any
Subsidiary thereof; provided that “Asset Sale” shall not include:  (i) any Disposition by Borrower or any
Subsidiary thereof of Investments of the type described in Section 7.02
other than Section 7.02(h); (ii) any
Disposition that is governed by and complies with Section 7.05
other than Section 7.05(e); or (iii) any issuance by Borrower of
perpetual common Equity Interests.

 

“Assignment and Assumption” means an
assignment and assumption entered into by a Lending Party and an Eligible
Assignee (with the consent of any party whose consent is required by Section 10.06(b)), and accepted by Administrative
Agent, in substantially the form of Exhibit A
or any other form approved by Administrative Agent.

 

3

 

“Attributable Debt” means, on any
date of determination:  (a) in
respect of any capital lease of any Person, the capitalized amount thereof that
would appear on a balance sheet of such Person prepared as of such date in
accordance with GAAP; and (b) in respect of any Synthetic Lease
Obligation, the capitalized amount of the remaining lease payments under the
relevant lease that would appear on a balance sheet of such Person prepared as
of such date in accordance with GAAP if such lease were accounted for as a
capital lease.

 

“Audited Financial Statements” means
the audited consolidated balance sheet for Borrower for the fiscal year ended January 31,
2010, and the related consolidated statements of income or operations,
shareholders’ equity and cash flows for such fiscal year of Borrower, including
the notes thereto, together with the opinion issued thereon by the independent
accountants that audited such financial statements.

 

“Automatic Extension Letter of Credit”
means a Letter of Credit that has automatic extension provisions.

 

“Bankruptcy Code” means the federal
Bankruptcy Reform Act of 1978 (11 U.S.C. Sections 101 et seq.).

 

“Bankruptcy Laws” means,
collectively:  (a) the Bankruptcy
Code; and (b) all other liquidation, conservatorship, bankruptcy,
assignment for the benefit of creditors, moratorium, rearrangement,
receivership, insolvency, reorganization, or similar debtor relief Laws of the
United States or other applicable jurisdictions from time to time in effect and
affecting the rights of creditors generally.

 

“Base Rate” means, for any
day, a fluctuating rate per annum equal to the higher of:  (a) the Federal Funds Rate plus 100.00 basis points per annum; (b) the Daily LIBOR
Rate; or (c) the per annum rate of interest in effect for such day as
publicly announced from time to time by Wells Fargo as its “Prime Rate,” such rate being the
rate of interest most recently announced within Wells Fargo at its principal
office as its “Prime Rate,” with the
understanding that Wells Fargo’s “Prime Rate”
is one of Wells Fargo’s base rates and serves as the basis upon which effective
rates of interest are calculated for those loans making reference thereto, and
is evidenced by the recording thereof after its announcement in such internal
publication or publications as Wells Fargo may designate.  Any change in Wells Fargo’s “Prime Rate” as announced by Wells
Fargo shall take effect at the opening of business on the day specified in the
public announcement of such change.  The
Prime Rate is not intended to be lowest rate of interest charged by Wells Fargo
in connection with extensions of credit to borrowers.

 

“Base Rate Loan” means a Loan that
bears interest as set forth in Section 2.08(a)(ii).

 

“Borrower Extension Notice” has the
meaning ascribed thereto in Section 2.16.

 

“Borrowing” means a Working Capital
Borrowing, a Floorplan Borrowing or a Swing Line Borrowing, as the context may
require.

 

“Borrowing Base Certificate” shall
mean a certificate, in substantially the form of Exhibit H
attached hereto and made a part hereof, setting forth the Working Capital
Borrowing Base and the Floorplan Borrowing Base and the component calculations
thereof.

 

4

 

“Business Day” means any day other
than a Saturday, Sunday or other day on which commercial banks are authorized
to close under the Laws of, or are in fact closed in, New York, New York or the
city and state where Administrative Agent’s Office is located; provided that, if any such day relates to the Eurodollar
Rate or any Eurodollar Rate Loan, such day must also be a day on which dealings
in Dollar deposits are conducted by and between banks in the London interbank
offered market.

 

“Capital Expenditures” means all
expenditures (whether paid in cash or other consideration or accrued as a
liability and including that portion of capital leases that is capitalized on
the balance sheet of such Person including in connection with a sale-leaseback
transaction) by such Person for the acquisition or leasing of fixed or capital
assets or additions to equipment (including replacements, capitalized repairs
and improvements during such period) that are required to be capitalized under
GAAP on a balance sheet of such Person, but specifically excluding
any Equipment purchased by a Loan Party for lease or rental to others.  For purposes of this definition:  (a) the purchase price of equipment that
is purchased simultaneously with the trade-in of existing equipment owned by
such Person thereof or with insurance proceeds shall be included in Capital
Expenditures only to the extent of the gross amount of such purchase price minus the credit granted by the seller of such equipment for
such equipment being traded in at such time, or the amount of such proceeds, as
the case may be; and (b) neither an acquisition to the extent made with
the proceeds of a Disposition in accordance with Section 2.05(c)(i) nor
an Acquisition complying with Section 7.02(e) shall
constitute a “Capital Expenditure.”

 

“Cash Collateral” means all
Collateral that has, in accordance with the provisions hereof, been pledged to
Cash Collateralize: 
(a) L/C Obligations; (b) at Borrower’s option in
accordance with Section 2.05(c)(vi), Working
Capital Loans that are Eurodollar Rate Loans; or (c) at Borrower’s option
in accordance with Section 2.05(c)(vii),
Floorplan Loans that are Eurodollar Rate Loans.

 

“Cash Collateralize” means to pledge
and deposit with or deliver to Administrative Agent, for the benefit of (a) L/C Issuer
and Working Capital Lenders, as collateral for the L/C Obligations, (b) at
Borrower’s option in accordance with Section 2.05(c)(vi),
Working Capital Lenders, as collateral for Working Capital Loans that are Eurodollar
Rate Loans, cash or deposit account balances pursuant to documents in form and
substance satisfactory to Administrative Agent and L/C Issuer (which
documents are hereby consented to by L/C Issuer and Working Capital
Lenders) or (c) at Borrower’s option in accordance with Section 2.05(c)(vii), Floorplan Lenders, as collateral
for Floorplan Loans that are Eurodollar Rate Loans, cash or deposit account
balances pursuant to documents in form and substance satisfactory to
Administrative Agent (which documents are hereby consented to by Floorplan
Lenders).

 

“Cash Equivalents” means, as to any
Person:  (a) securities issued or
directly and fully guaranteed or insured by the United States or any agency or
instrumentality thereof (but only so long as the full faith and credit of the
United States is pledged in support thereof) having maturities of not more than
twelve months from the date of acquisition; (b) securities issued by any
state of the United States or any political subdivision of any such state or
any public instrumentality thereof having maturities of not more than ninety
days from the date of acquisition and having one of the two highest ratings
from either Standard & Poor’s Corporation or Moody’s Investors Service, Inc.;
(c) domestic and Eurodollar certificates of deposit, time or demand
deposits or bankers’ acceptances maturing within six months after the date of
acquisition issued or guaranteed by or placed with, and money market deposit
accounts issued or offered by: 
(i) any Lender; and (ii) any commercial bank organized under
the laws of the United States or any state thereof or the District of Columbia
having combined capital and surplus of not less

 

5

 

than
$250,000,000; (d) repurchase obligations with a term of not more than
thirty days for underlying securities of the types described in clause (a) and
(b) of this definition entered into with any bank meeting the
qualifications specified in clause (c) of this definition;
(e) commercial paper issued by the parent corporation of any Lender or any
commercial bank (provided that the parent corporation and the bank are both
incorporated in the United States) having capital and surplus in excess of $250,000,000
and commercial paper issued by any Person incorporated in the United States,
which commercial paper is rated at least A-1 or the equivalent thereof by
Standard & Poor’s Corporation or at least P-1 or the equivalent
thereof by Moody’s Investors Service, Inc., and in each case maturing not
more than ninety days after the date of acquisition by such Person; and
(f) investments in money market funds substantially all the assets of
which are comprised of securities of the types described in clauses (a) through
(e) of this definition.

 

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

 

“Change of Control” means (a) an
event or series of events by which any “person” or “group” (as such terms are
used in Sections 13(d) and 14(d) of the Exchange Act, but
excluding any employee benefit plan of such person or its subsidiaries, and any
person or entity acting in its capacity as trustee, agent or other fiduciary or
administrator of any such plan) becomes the “beneficial owner” (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act, except that a person or
group shall be deemed to have “beneficial ownership” of all securities that
such person or group has the right to acquire, whether such right is
exercisable immediately or only after the passage of time (such right, an “option right”)), directly or indirectly, of 35.00% or more
of the Equity Interests of Borrower entitled to vote for members of the board
of directors or equivalent governing body of Borrower on a fully-diluted basis
(and taking into account all such securities that such person or group has the
right to acquire pursuant to any option right), (b) the failure of a
majority of the seats (other than vacant seats) on the board of directors of
Borrower to be occupied by persons who were nominated by the board of directors
of Borrower or appointed by directors so nominated, (c) after taking any
to account any modification or waiver thereunder, the occurrence of any change
in control (or similar event, however denominated) with respect to Borrower or
any of its Subsidiaries shall occur under and as defined in any indenture or
agreement to which Borrower or any of its Subsidiaries is a party, or (d) the
failure of Borrower to own directly or indirectly, beneficially and of record,
100% of the aggregate ordinary voting power and economic interests represented
by the issued and outstanding Equity Interests of each Subsidiary (or such
lesser percentage as may be owned, directly or indirectly, as of the Closing
Date or the later acquisition thereof) except where such failure is as a result
of a transaction permitted by the Loan Documents.

 

“Closing Date” means the first date
on which all of the conditions precedent in Section 4.01
are satisfied (or waived in accordance with Section 10.01).

 

“CNH Intercreditor Agreement” means
an Intercreditor Agreement among CNH America LLC, CNH Capital America LLC, and
Wells Fargo Bank, National Association.

 

6

 

“CNH Parts Reserve” means an amount
established by the Administrative Agent to reflect the amount of proceeds of
Case New Holland parts which, in accordance with the terms of the CNH
Intercreditor Agreement, CNH Capital America LLC is entitled to receive.

 

“Code” means the Internal Revenue
Code of 1986.

 

“Collateral” means all property and
interests in property and proceeds thereof now owned or hereafter acquired by
Borrower or any Subsidiary thereof in or upon which a Lien now or hereafter
exists in favor of Administrative Agent, for the benefit of itself and each
Lending Party (or any of the foregoing), whether under this Agreement or under
any other Loan Document.

 

“Collateral Documents” means,
collectively, the Guaranties, the Security Documents and all other security
agreements, mortgages, deeds of trust, patent, trademark and copyright
assignments, lease assignments and other similar documents between Borrower or
any Subsidiary thereof and Administrative Agent, for the benefit of itself and
each Lending Party (or any of the foregoing), now or hereafter delivered to
Administrative Agent pursuant to or in connection with the transactions
contemplated hereby, and all financing statements (or comparable documents now
or hereafter filed in accordance with the Uniform Commercial Code or other
comparable Law) against Borrower or any Subsidiary thereof as debtor in favor
of Administrative Agent, for the benefit of itself and each Lending Party (or
any of the foregoing), as secured party.

 

“Commitment” means, as to any Lender,
such Lender’s Working Capital Commitment, Floorplan Commitment or Swing Line
Commitment, as applicable.

 

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

 

“Consolidated EBITDAR” means, for any
period, for Borrower and its Subsidiaries on a consolidated basis, the sum of
(without duplication): 
(a) Consolidated Net Income for such period; plus
(b) Consolidated Interest Expense (net of interest income) for such period
to the extent included in the determination of such Consolidated Net Income; plus (c) and all amounts treated as expenses for such
period for depreciation and amortization, but in each case only to the extent
included in the determination of such Consolidated Net Income; plus (d) Consolidated Rent Expense plus
(e) income tax expense related to income made by the Borrower and its
Subsidiaries; provided that Consolidated Net
Income shall be computed for all of the foregoing purposes without giving
effect to extraordinary gains or extraordinary losses.

 

“Consolidated Fixed Charge Coverage Ratio”
means, as of the last day of a fiscal quarter, for the period consisting of the
four consecutive Fiscal Periods ending on such date, subject to Section 1.02(h), the ratio of:  (a) the sum for such period of (without
duplication):  (i) Consolidated
EBITDAR; minus (ii) all payments in cash for
taxes related to income made by Borrower and its Subsidiaries; minus (iii) Capital Expenditures actually made in cash
by Borrower and its Subsidiaries (net of any insurance proceeds, condemnation
awards or proceeds relating to any financing with respect to such
expenditures); minus (iv) Restricted
Payments paid in cash by Borrower; to (b) of:  (i) Consolidated Interest Expense; plus (ii) Consolidated Rent Expense; plus (iii) without duplication, all current maturities
of long-term Debt (including with respect to Debt that is a capital lease).

 

7

 

“Consolidated Interest Expense”
means, for any period, for Borrower and its Subsidiaries on a consolidated
basis, the sum of (without duplication): 
(a) all interest, premium payments, debt discount, fees, charges
and related expenses in connection with borrowed money (including capitalized
interest) or in connection with the deferred purchase price of assets during
such period; plus (b) all payments made
under interest rate Swap Contracts during such period to the extent not
included in clause (a) of this definition; minus
(c) all payments received under interest rate Swap Contracts during such
period; plus (d) the portion of rent
expense with respect to such period under capital leases that is treated as
interest in accordance with GAAP.

 

“Consolidated Leverage Ratio” means,
as of any date of determination, the ratio of: 
(a)  Consolidated Total Liabilities; to
(b) Consolidated Tangible Net Worth.

 

“Consolidated Net Income” means for
any period, the sum of net income (or loss) for such period of the Borrower and
its Subsidiaries on a consolidated basis determined in accordance with GAAP,
but excluding any income of any Person if such Person is not a Subsidiary,
except that the Borrower’s direct or indirect equity in the net income of any
such person for such period shall be included in such Consolidated Net Income
in accordance with GAAP.

 

“Consolidated Rent Expense” means for
such period, total rental expenses attributable to operating leases of the
Borrower and its Subsidiaries for real property on a consolidated basis.

 

“Consolidated Tangible Net Worth”
means, as of any date of determination, for Borrower and its Subsidiaries on a
consolidated basis, the sum of (without duplication):  (a) stockholders’ equity; minus (b) treasury stock; minus
(c) all intangible assets, including goodwill, patents, trademarks, trade
names, organization expense, unamortized debt discount and expense, capitalized
or deferred research and development costs, deferred marketing expenses, and
other like intangibles.

 

“Consolidated Total Assets” means as
of any date, the value of the assets reflected on the consolidated balance
sheet of the Borrower and its Subsidiaries as of such date prepared in
accordance with GAAP.

 

“Consolidated Total Liabilities”
means as of any date, total liabilities reflected on the consolidated balance
sheet of the Borrower and its Subsidiaries as of such date prepared in
accordance with GAAP.

 

“Contractual Obligation” means, as to
any Person, any document or other agreement or undertaking to which such Person
is a party or by which it or any of its property is bound.

 

“Control” means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of a Person, whether through the ability to exercise
voting power, by contract or otherwise. 
The terms “Controlling” and “Controlled” have meanings
correlative thereto.  Without limiting
the generality of the foregoing, a Person shall be deemed to be Controlled by
another Person if such other Person possesses, directly or indirectly, the
power to vote 12.50% or more of the securities having ordinary voting power for
the election of directors, managing general partners or the equivalent.  It is agreed that Dealer Sites, LLC shall not
be deemed to be under common control with Borrower or other Loan Parties.

 

8

 

“Credit Extension” means each of the
following: (a) a Borrowing; and (b) an L/C Credit Extension.

 

“Daily LIBOR” means, for any day, the
rate of interest equal to LIBOR then in effect for delivery for a one (1) month
period.   When interest is determined in
relation to Daily LIBOR, each change in the interest rate shall become
effective each Business Day that Administrative Agent determines that Daily
LIBOR has changed.

 

“Daily LIBOR Rate” means, for any
day, a fluctuating rate per annum equal to Daily LIBOR for such day (determined
on a daily basis) plus 100.00 basis points per
annum, provided if for any reason Daily LIBOR
is unavailable and/or the Administrative Agent is unable to determine Daily
LIBOR for any period, the Administrative Agent may, at its discretion, either: (a) select
a replacement index based on the arithmetic mean of the quotations, if any, of
the interbank offered rate by first class banks in London or New York for
deposits with comparable maturities or (b) accrue interest at a rate per
annum equal to Wells Fargo’s “Prime Rate”
during any period which Daily LIBOR is unavailable or cannot be determined,
such “Prime Rate,” being the rate
of interest most recently announced within Wells Fargo at its principal office
as its “Prime Rate,” with the
understanding that Wells Fargo’s “Prime Rate”
is one of Wells Fargo’s base rates and serves as the basis upon which effective
rates of interest are calculated for those loans making reference thereto, and
is evidenced by the recording thereof after its announcement in such internal
publication or publications as Wells Fargo may designate.  Any change in Wells Fargo’s “Prime Rate” as announced by Wells
Fargo shall take effect at the opening of business on the day specified in the
public announcement of such change.  The
Prime Rate is not intended to be lowest rate of interest charged by Wells Fargo
in connection with extensions of credit to borrowers.

 

“Debt” means, as to any Person as of
any date of determination, without duplication, all of the following, whether
or not included as indebtedness or liabilities in accordance with GAAP:  (a) all obligations of such Person for
borrowed money and all obligations of such Person evidenced by bonds,
debentures, notes, loan agreements or other similar instruments; (b) all
direct or contingent obligations of such Person arising under letters of credit
(including standby and commercial letters of credit), bankers’ acceptances,
bank guaranties, surety bonds and similar instruments; (c) the Swap
Termination Value under all Swap Contracts to which such Person is a party;
(d) all obligations of such Person to pay the deferred purchase price of
property or services (other than trade accounts payable in the ordinary course
of business not past due for more than sixty days); (e) indebtedness
(excluding prepaid interest thereon) secured by a Lien on property owned or
being purchased by such Person (including indebtedness arising under
conditional sales or other title retention agreements), whether or not such
indebtedness shall have been assumed by such Person or is limited in recourse;
(f) the amount of Attributable Debt in respect of all capital lease
obligations and Synthetic Lease Obligations of such Person; (g) all
obligations of such Person to purchase, redeem, retire, defease or otherwise
make a payment in respect of Disqualified Equity Interests valued, in the case
of a redeemable preferred interest, at the greater of its voluntary or
involuntary liquidation preference plus accrued
and unpaid dividends; and (h) all Guarantees of such Person in respect of
any of the foregoing.  For all purposes
hereof, the Debt of any Person shall include the Debt of any partnership or
joint venture (other than a joint venture that is itself a corporation or
limited liability company) in which such Person is a general partner or a joint
venturer, unless such Debt is expressly made non-recourse to such Person.

 

9

 

“Default” means any Event of Default
or any event or condition that, with the giving of notice, the passage of time,
or both, would constitute an Event of Default.

 

“Default Rate” means:  (a) when used with respect to Obligations
other than L/C Fees, a per annum interest rate equal to the sum of:  (i) the Base Rate; plus
(ii) the Applicable Rate, if any, applicable to Base Rate Loans; plus (iii) 200.00 basis points per annum; provided that, with respect to a Eurodollar Rate Loan, the
Default Rate shall be a per annum interest rate equal to the sum of:  (A) the interest rate (including any
Applicable Rate) otherwise applicable to such Loan; plus
(B) 200.00 basis points per annum; and (b) when used with respect to
L/C Fees, a per annum interest rate equal to the sum of (i) the
Applicable Rate plus (ii) 200.00 basis
points per annum.

 

“Defaulting Lender” means any Lender
that:  (a) has failed to fund any
portion of the Working Capital Loans, any portion of the Floorplan Loans, any participations
in L/C Obligations or any participations in Swing Line Loans required to
be funded by it hereunder within one Business Day of the date required to be
funded by it hereunder; (b) has otherwise failed to pay to Administrative
Agent or any Lending Party, as the case may be, any other amount required to be
paid by it hereunder within one Business Day of the date when due, unless the
subject of a good faith dispute; or (c) has been deemed insolvent or
become the subject of a proceeding under any Bankruptcy Law.

 

“Disqualified Equity Interest” means
any Equity Interest of any Person that, by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable at the
option of the holder thereof), or upon the happening of any event, matures or
is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise,
or is redeemable at the option of the holder thereof, in whole or in part, or
requires or mandates payments or distributions in cash, on or prior to the date
that is one year after the last to occur of the Working Capital Maturity Date
and Floorplan Maturity Date.  The term “Disqualified
Equity Interest” shall also include any options, warrants or other rights that
are convertible into Disqualified Equity Interest or that are redeemable at the
option of the holder, or required to be redeemed, prior to the date that is one
year after the last to occur of the Working Capital Maturity Date and Floorplan
Maturity Date.

 

“Disposition” means the sale, assignment
transfer, conveyance, license, lease or other disposition (including any sale
and leaseback transaction) of any property by any Person, including any sale,
assignment, transfer, conveyance or other disposal, with or without recourse,
of any notes or accounts receivable or any rights and claims associated
therewith.  The term “Dispose” has a meaning correlative thereto.

 

“Dollar” and “$”
mean lawful money of the United States.

 

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

 

“Electronic Platform” means an
electronic system for the delivery of information (including documents), such
as DXSyndicateTM, that may or may not be provided or administered by Administrative
Agent or an Affiliate thereof.

 

10

 

“Eligible Accounts” means all unpaid
Accounts of the Loan Parties,
net of any credits, but excluding any such Accounts having any of the following
characteristics:

 

(a)           That portion of Accounts unpaid 90 days or more
after the invoice date;

 

(b)           That portion of Accounts related to goods or
services with respect to which a Loan Party has received written notice of a
claim or dispute, which are subject to a claim of offset or a contra account,
or which reflect a reasonable reserve for warranty claims or returns;

 

(c)           That portion of Accounts not yet earned by the final
delivery of goods or that portion of Accounts not yet earned by the
final rendition of services by a Loan Party to the account debtor, including
with respect to both goods and services, progress billings, and that portion of
Accounts for which an invoice has not been sent to the applicable account
debtor;

 

(d)           Accounts constituting (i) proceeds of copyrightable
material unless such copyrightable material shall have been registered with the
United States Copyright Office, or (ii) proceeds of patentable inventions
unless such patentable inventions have been registered with the United States
Patent and Trademark Office;

 

(e)           Accounts owed by any unit of the United States
federal government or any foreign government;

 

(f)            Accounts denominated in any currency other than
United States dollars;

 

(g)           Accounts owed by an account debtor located outside
the United States or Canada (excluding
the provinces of Newfoundland and Quebec, the Northwest Territories and the
Territory of Nunavut) which are not (i) backed by a bank letter of
credit naming the Administrative Agent as beneficiary or assigned to the
Administrative Agent, in the Administrative Agent’s possession or control, and
with respect to which a control agreement concerning the letter-of-credit
rights is in effect, and acceptable to the Administrative Agent in all
respects, in its sole discretion, or (ii) covered by a foreign receivables
insurance policy acceptable to the Administrative Agent in its sole discretion;

 

(h)           Accounts owed by an account debtor for which a Loan
Party has received notice that such account debtor is insolvent, the subject of
bankruptcy proceedings or has gone out of business;

 

(i)            Accounts owed by a Subsidiary, Affiliate, officer or
employee of the Borrower or any Subsidiary of Borrower;

 

(j)            Accounts not subject to a duly perfected security
interest in the Administrative Agent’s favor;

 

(k)           Accounts which are subject to any Lien in favor of
any Person other than the Administrative Agent, unless such Account is
subject to a duly perfected first priority security 

 

11

 

interest in the Administrative Agent’s favor pursuant to an
intercreditor agreement acceptable to Administrative Agent with each other
Person holding a Lien in such Account;

 

(l)            That portion of Accounts that has been restructured,
extended, amended or modified, other than Accounts extended as a result of
marketing campaigns entered into in the ordinary course of business;

 

(m)          Accounts owed by an account debtor, regardless of
whether otherwise eligible, to the extent that the aggregate balance of such
Accounts exceeds twenty percent (20%) of the aggregate amount of all Eligible
Accounts; and

 

(n)           Accounts owed by an account debtor, regardless of
whether otherwise eligible, if twenty percent (20%) or more of the total amount
of Accounts due from such debtor is ineligible hereunder.

 

“Eligible Assignee” means any of the
following:  (a) a Lender;
(b) an Affiliate of a Lender; (c) any Person (other than a natural
person) that is (or will be) engaged in making, purchasing, holding or
otherwise investing in commercial loans and similar extensions of credit in the
ordinary course of business to the extent such Person is administered or
managed by:  (i) a Lender;
(ii) an Affiliate of a Lender; or (iii) a Person or an Affiliate of a
Person that administers or manages a Lender; and (d) any other Person
(other than a natural person) approved by Administrative Agent, Swing Line
Lender and L/C Issuer and Borrower as provided in this Agreement; provided that, notwithstanding the foregoing, “Eligible Assignee” shall not include
any Affiliates of Borrower or any competitor of Borrower or any of its
Subsidiaries or any of such Person’s Affiliates.

 

“Eligible Inventory” means Inventory
owned by any Loan Party; but excluding any Inventory having any of the
following characteristics:

 

(a)           Inventory that is: not subject to a duly perfected
first priority security interest in the Administrative Agent’s favor; covered
by any negotiable or non-negotiable warehouse receipt, bill of lading or other
document of title; on consignment from any Person; on consignment to any Person
or subject to any bailment unless such consignee or bailee has executed an
agreement with the Administrative Agent;

 

(b)           Packaging, raw materials, parts, sample Inventory,
or customer supplied parts or Inventory and other items not held for sale;

 

(c)           Work-in-process Inventory;

 

(d)           Inventory that is materially damaged, defective,
obsolete, slow moving or not currently saleable in the normal course of the
Loan Parties’ operations, or the amount of such Inventory that has been reduced
by shrinkage;

 

(e)           Inventory that a Loan Party has returned;

 

12

 

(f)            Inventory manufactured by a Loan Party pursuant to a
license unless the applicable licensor has agreed in writing to permit the
Administrative Agent to exercise its rights and remedies against such
Inventory;

 

(g)           Inventory that is not covered by casualty insurance
reasonably acceptable to Administrative Agent;

 

(h)           Inventory that is subject to a Lien in favor of any
Person other than the Administrative Agent unless such Inventory is
subject to a duly perfected first priority security interest in the
Administrative Agent’s favor pursuant to an intercreditor agreement acceptable
to Administrative Agent with each other Person holding a Lien in such
Inventory; and

 

(i)            Inventory that is in-transit, unless the in-transit
Inventory is Eligible Rental Equipment or other Inventory in-transit between
the Loan Party’s locations.

 

“Eligible New Equipment Inventory”
means all Inventory owned by a Loan Party which is (a) Eligible Inventory
in all respects and (b) Inventory which consists of new Equipment held by
a Loan Party for sale to others.

 

“Eligible Parts and Attachments Inventory”
means Inventory owned by a Loan Party which is parts held by a Loan Party for
sale to others, valued at the lower of cost or market in accordance with GAAP;
but excluding any Inventory which is parts having any of the following
characteristics:

 

(a)           Inventory that is: not
subject to a duly perfected first priority security interest in the
Administrative Agent’s favor, except  for Case New Holland parts if Administrative Agent’s
security interest is adequately addressed in a CNH Intercreditor Agreement
acceptable to Administrative Agent;

 

(b)           Inventory that is: covered
by any negotiable or non-negotiable warehouse receipt, bill of lading or other
document of title; on consignment from any Person; on consignment to any Person
or subject to any bailment unless such consignee or bailee has executed an
agreement with the Administrative Agent;

 

(c)           Packaging, raw materials, sample Inventory, or
customer supplied parts or Inventory and other items not held for sale;

 

(d)           Work-in-process Inventory;

 

(e)           Inventory that is materially damaged, defective,
obsolete or not currently saleable in the normal course of the Loan Parties’
operations, or the amount of such Inventory that has been reduced by shrinkage;

 

(f)            Inventory that a Loan Party has returned;

 

13

 

(g)           Inventory manufactured by a Loan Party pursuant to a
license unless the applicable licensor has agreed in writing to permit the
Administrative Agent to exercise its rights and remedies against such
Inventory;

 

(h)           Inventory that is not covered by casualty insurance
reasonably acceptable to Administrative Agent;

 

(i)            Inventory that is subject to a Lien in favor of any
Person other than the Administrative Agent  unless
such Inventory is subject to a duly perfected first priority security interest
in the Administrative Agent’s favor pursuant to an intercreditor agreement
acceptable to Administrative Agent with each other Person holding a Lien in
such Inventory;

 

(j)            Inventory that is in-transit, unless the in-transit
Inventory is in-transit between the Loan Party’s locations, and

 

(k)           Inventory not subject to a buy-back and held by
Borrower for more than three (3) years which exceeds an aggregate value of
$1,000,000.

 

“Eligible Rental Equipment” means all
Equipment owned by a Loan Party which is (a) Eligible Inventory in all
respects and (b) consists of Equipment held by a Loan Party for lease or
rental to others.

 

“Eligible Used Equipment Inventory”
means all Inventory owned by a Loan Party which is (a) Eligible Inventory
in all respects, (b) Inventory which consists of used Equipment held by a
Loan Party for sale to others and (c) not held by Borrower for more than
three (3) years.

 

“Eligible Work In Process Inventory”
means all Inventory owned by a Loan Party which is Eligible Inventory or
Eligible Parts and Attachments Inventory in all respects except for the fact
that such Inventory is work in process inventory (for clarity, Eligible Work in
Process Inventory includes, without limitation, parts and services).

 

“Environmental Laws” means any and
all Federal, state, local, and foreign statutes, laws, regulations, ordinances,
rules, judgments, orders, decrees, permits, concessions, grants, franchises,
licenses, agreements or governmental restrictions relating to pollution, the
protection of the environment or the release of any materials into the
environment, including those related to Hazardous Materials or wastes, air
emissions and discharges to waste or public systems.

 

“Environmental Liability” means any
liability, contingent or otherwise (including any liability for damages, costs
of environmental remediation, fines, penalties or indemnities), of Borrower,
any other Loan Party or any of their respective Subsidiaries directly or
indirectly resulting from or based upon: 
(a) violation of any Environmental Law; (b) the generation,
use, handling, transportation, storage, treatment or disposal of any Hazardous
Materials; (c) exposure to any Hazardous Materials; (d) the release
or threatened release of any Hazardous Materials into the environment; or
(e) any contract, agreement or other consensual arrangement pursuant to
which liability is assumed or imposed with respect to any of the foregoing.

 

14

 

“Environmental Permit” means any
permit, approval, authorization, certificate, license, variance, filing or
permission required by or from any Governmental Authority pursuant to any
Environmental Law.

 

“Equipment” means whole goods (and
not attachments) held for resale, lease or rental.

 

“Equity Interests” means, with
respect to any Person, all of the shares of capital stock of (or other
ownership or profit interests in) such Person, all of the warrants, options or
other rights for the purchase or acquisition from such Person of shares of
capital stock of (or other ownership or profit interests in) such Person, all
of the securities convertible into or exchangeable for shares of capital stock
of (or other ownership or profit interests in) such Person or warrants, rights
or options for the purchase or acquisition from such Person of such shares (or
such other interests), and all of the other ownership or profit interests in
such Person (including partnership, member or trust interests therein), whether
voting or nonvoting, and whether or not such shares, warrants, options, rights
or other interests are outstanding on any date of determination.

 

“ERISA” means the Employee Retirement
Income Security Act of 1974.

 

“ERISA Affiliate” means any trade or
business (whether or not incorporated) under common control with Borrower or
any Subsidiary thereof within the meaning of Section 414(b) or (c) of
the Code (and Sections 414(m) and (o) of the Code for
purposes of provisions relating to Section 412 of the Code).

 

“ERISA Event” means any of the
following:  (a) a Reportable Event
with respect to a Pension Plan; (b) the incurrence by Borrower or an ERISA
Affiliate of any liability with respect to a withdrawal by Borrower or any
ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA
during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of
ERISA) or a cessation of operations that is treated as such a withdrawal under
Section 4062(e) of ERISA; (c) the incurrence by Borrower or any
ERISA Affiliate of any liability with respect to a complete or partial
withdrawal by Borrower or any ERISA Affiliate from a Multiemployer Plan or the
receipt by Borrower or an ERISA Affiliate of notification that a Multiemployer
Plan is in reorganization; (d) the filing of a notice of intent to
terminate, the treatment of a Plan amendment as a termination under
Sections 4041 or 4041A of ERISA, or the commencement of proceedings by the
PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or
condition that constitutes grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Pension Plan
or Multiemployer Plan; (f) the imposition of any liability under
Title IV of ERISA, other than for PBGC premiums due but not delinquent
under Section 4007 of ERISA, upon Borrower or any ERISA Affiliate.

 

“Eurodollar Rate” means for any
Interest Period, with respect to a Eurodollar Rate Loan, a rate per annum
(rounded upwards, as necessary, to the nearest one one-hundredth of 1.00%)
obtained by dividing:  (a) the rate
per annum determined by Administrative Agent at approximately 11:00 a.m.
(London time) on the date that is two Business Days prior to the beginning of
such Interest Period by reference to the British Bankers’ Association “Interest
Settlement Rates” for deposits in Dollars (as set forth by any service
(including Bloomberg, Reuters and Thomson Financial) selected by Administrative
Agent that has been nominated by the British Bankers’ Association as an
authorized information vendor for the purpose of displaying such rates) in an
amount approximately equal to the principal amount to which such Interest
Period applies (for delivery on the first day of such Interest Period) with a
term

 

15

 

equivalent
to such Interest Period; provided that,
if an interest rate is not ascertainable pursuant to the foregoing provisions
of this definition, then “Eurodollar Rate”
shall be the interest rate per annum determined by Administrative Agent to be
the average of the rates per annum at which deposits in Dollars in an amount
approximately equal to the principal amount to which such Interest Period
applies (for delivery on the first day of such Interest Period) with a term
equivalent to such Interest Period are offered for such Interest Period by
Wells Fargo to major banks in the London interbank offered market in London,
England at approximately 11:00 a.m. (London time) on the date that is two
Business Days prior to the beginning of such Interest Period; by (b) the sum of: 
(i) one; minus
(ii) the stated maximum rate (rounded upwards, as necessary, to the
nearest one one-hundredth of 1.00%), as in effect on the date of the
determination of any “Eurodollar Rate”
in accordance with clause (a) of this definition, of all reserve
requirements (including any marginal, emergency, supplemental, special or other
reserves) applicable on such date to any member bank of the Federal Reserve
System in respect of “Eurocurrency liabilities” as defined in Regulation D (or
any successor category of liabilities under Regulation D) of the FRB as in
effect on such day, whether or not applicable to any Lending Party.  Each determination by Administrative Agent
pursuant to this definition shall be conclusive absent manifest error.

 

“Eurodollar Rate Loan” means a Loan
that bears interest based upon the Eurodollar Rate.

 

“Event of Default” has the meaning
ascribed thereto in Section 8.01.

 

“Event of Loss” means, with respect
to any property, any of the following: 
(a) any loss, destruction or damage of such property; or
(b) any actual condemnation, seizure or taking, by exercise of the power
of eminent domain or otherwise, of such property, or confiscation of such
property or the requisition of the use of such property.

 

“Exchange Act” means the Securities
Exchange Act of 1934.

 

“Excluded Taxes” means, with respect
to Administrative Agent, any Lending Party or any other recipient of any
payment to be made by or on account of any obligation of Borrower or any
Guarantor hereunder or under any Loan Document, any taxes on or measured by
overall net income (however denominated), franchise taxes (in lieu of net
income taxes) and branch profits taxes, in each case imposed on it by the
jurisdiction (or any political subdivision thereof) under the laws of which
such recipient is organized or in which its principal office is located or, in
the case of any Lending Party, in which its applicable Lending Office is
located.

 

“Existing Facilities to be Paid Off”
means, collectively, the credit facilities identified on Schedule 1.01-B.

 

“Existing Guaranteed Obligations” has
the meaning ascribed thereto in Section 10.14(j).

 

“Existing Letters of Credit” means
the letters of credit identified on Schedule 1.01-C.

 

“Federal Funds Rate” means, for any
day, the rate per annum equal to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers on such day, as published by the Federal Reserve Bank
of New York on the Business Day next succeeding such day; provided
that:  (a) if such day is not a
Business Day, then the 

 

16

 

Federal
Funds Rate for such day shall be such rate on such transactions on the next
preceding Business Day as so published on the next succeeding Business Day; and
(b) if no such rate is so published on such next succeeding Business Day,
then the Federal Funds Rate for such day shall be the average rate (rounded
upward, if necessary, to a whole multiple of one one-hundredth of 1.00%)
charged to Wells Fargo on such day on such transactions as determined by
Administrative Agent.

 

“Fee Letter” means the letter
agreement, dated September 1, 2010, among Borrower, the Arranger and the
Administrative Agent regarding certain fees to be paid by the Borrower to the
Arranger, Administrative Agent and L/C Issuer.

 

“Fiscal Period” means, as of any date
of determination with respect to Borrower or any Subsidiary thereof, each
fiscal quarter occurring during each of Borrower’s fiscal years.

 

“Floorplan Availability” means, at
any time, the lesser of (a) the Aggregate Floorplan Commitments at such
time or (b) the Floorplan Borrowing Base at such time.

 

“Floorplan Availability Period” means
the period from the Closing Date to the Floorplan Maturity Date.

 

“Floorplan Borrowing” means a
borrowing consisting of simultaneous Floorplan Loans of the same Type and, in
the case of Eurodollar Rate Loans, having the same Interest Period made by each
Floorplan Lender pursuant to Section 2.01(b).

 

“Floorplan  Borrowing
Base” means as of any date of calculation, an amount, as set
forth on the most current Borrowing Base Certificate delivered to the
Administrative Agent, equal to the sum of:

 

(a)                                  90% of the net
book value of Eligible New Equipment Inventory; plus

 

(b)                                 85% of the net
book value of Eligible Used Equipment Inventory; minus

 

(c)                                  the Floorplan
Borrowing Base Reserve.

 

The
Borrower, Administrative Agent and the Lenders acknowledge and agree that
(i) the advance rates set forth in this definition are solely to establish
the parameters for Availability, and (ii) this definition does not
constitute nor shall it be deemed to constitute an express or implied
representation or determination by Lenders that the recovery in a forced liquidation
scenario would be equal to the advance rates established herein.

 

“Floorplan
Borrowing Base Reserve” means, as of any date of determination,
such amounts (expressed as either a specified amount or as a percentage of a
specified category or item) as the Administrative Agent may from time to time
establish and adjust in reducing Floorplan Availability acting in its Permitted
Discretion (a) to the extent to reasonably reflect events, conditions,
contingencies or risks that materially adversely affect (i) the value of
the Collateral consisting of that which is taken into account in determining
the Floorplan Borrowing Base, or (ii) the security interests and other
rights of the Administrative Agent or Lenders in such Collateral (including the
enforceability, perfection and priority thereof), or (b) to the extent to
reasonably reflect any collateral report or financial information

 

17

 

furnished by or on behalf of the Borrower to the
Lenders that is or was incomplete, inaccurate or misleading in any material
respect that affects such Collateral’s value that has not been cured after 10
days prior written notice thereof to the Borrower, or (c) in respect of
any Default or an Event of Default during the continuation thereof; provided
that (x) any such required reserves shall continue only for so long as the
events, conditions, contingencies or risks giving rise thereto continue, (y) the
Administrative Agent shall give Borrower the lesser of 45 days notice (or if 45
days notice would cause such reserve not to be reflected on the second
Borrowing Base Certificate required to be delivered after the date thereof, the
number of days which would cause such reserve to be so reflected) of any
increase in any such reserves under clause (a)(i), and (z) in the case of
reserves required under clause (a)(i), upon delivery of notice to Borrower, as
provided above, the Administrative Agent shall be available to discuss the
proposed reserve, and Borrower may take such action as may be required so that
the event, condition or matter that is the basis for such reserve no longer
exists in a manner and to the extent reasonably satisfactory to the
Administrative Agent in the exercise of its Permitted Discretion.

 

“Floorplan Commitment” means, as to
each Floorplan Lender at any time any determination thereof is to be made, its
obligation to do the following pursuant to the terms hereof (a) make
Floorplan Loans to Borrower; and (b) purchase participations in Swing Line
Loans; all in an aggregate principal amount at any one time outstanding not to
exceed the amount set forth opposite such Lender’s name on Schedule 2.01
or in the Assignment and Assumption pursuant to which such Lender became a
party hereto, as applicable, as such amount may be adjusted from time to time
in accordance with this Agreement.

 

“Floorplan Lender” means,
collectively, (a) initially, each Lender designated on Schedule 2.01  as
a “Floorplan Lender” and (b) each Lender that assumes a Floorplan
Commitment pursuant to an Assignment and Assumption or pursuant to the
applicable Additional Commitment Documentation or which otherwise holds a
Floorplan Commitment, a Floorplan Loan or a risk participation in a Swing Line
Loan.

 

“Floorplan Loan” has the meaning
ascribed thereto in Section 2.01(b).

 

“Floorplan Maturity Date” means the
earliest of:  (a) October 31,
2014, or if applicable, any extension thereof pursuant to Section 2.16;
(b) the date of the termination of the Aggregate Floorplan Commitments
pursuant to Section 2.06; and (c) the
date of the termination of the Aggregate Floorplan Commitments.

 

“Floorplan Percentage Share” means as
to any Floorplan Lender at any time, the percentage (expressed as a decimal
carried out to the ninth decimal place) of the Aggregate Floorplan Commitments
represented by such Lender’s Floorplan Commitment at such time; provided that, if the commitment of each Floorplan Lender to
make Floorplan Loans have been terminated pursuant to Section 8.02
or if the Aggregate Floorplan Commitments have expired, then the Floorplan
Percentage Share of each Floorplan Lender shall be determined based upon such
Lender’s Floorplan Percentage Share most recently in effect, giving effect to
any subsequent assignments.  The initial
Floorplan Percentage Share of each Floorplan Lender is set forth opposite the
name of such Lender on Schedule 2.01
or in the Assignment and Assumption or the Additional Commitment Documentation
pursuant to which such Lender became a party hereto, as applicable.

 

18

 

“Foreign Pledge Agreement” means, a
pledge agreement, in form and substance satisfactory to the Administrative
Agent, pursuant to which a Loan Party grants a security interest to the
Administrative Agent, for the ratable benefit of the Secured Parties, in 100%
of the non-voting and 65% of the voting Equity Interests in a first tier
Foreign Subsidiary, which pledge agreement is governed by the laws of the
jurisdiction of organization of such Material First Tier Foreign Subsidiary.

 

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

 

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

 

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

 

“Governmental Authority” means the
government of the United States or any other nation, or of any political
subdivision thereof, whether state or local, and any agency, authority,
instrumentality, regulatory body, court, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government (including
any supra-national bodies such as the European Union or the European Central
Bank).

 

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

 

“Guaranteed Obligations” has the
meaning ascribed thereto in Section 10.14(a).

 

“Guarantors” means,
collectively:  (a) each Subsidiary
Guarantor (including each Subsidiary of Borrower who executes a Joinder
Agreement following the date hereof); and (b) each other Person who,
following the date hereof, is required pursuant to the terms hereof to be a
guarantor of the Obligations.

 

19

 

“Guaranty” means any guaranty, in
form and substance acceptable to Administrative Agent, made by a Guarantor for
the benefit of Administrative Agent and Lending Parties and includes the
guaranty set forth in Section 10.14.

 

“Hazardous Materials” means all
explosive or radioactive substances or wastes and all hazardous or toxic
substances, wastes or other pollutants, including petroleum or petroleum
distillates, asbestos or asbestos-containing materials, polychlorinated
biphenyls, radon gas, infectious or medical wastes and all other substances or
wastes of any nature regulated pursuant to any Environmental Law.

 

“Honor Date” means, with respect to
any Letter of Credit, the date of any payment by L/C Issuer thereunder.

 

“Indemnified Taxes” means Taxes other
than Excluded Taxes.

 

“Indemnitees” means, collectively,
Administrative Agent (and any sub-agent thereof), each Lending Party and each
Related Party of any of the foregoing Persons.

 

“Intercreditor Agreement” means an
intercreditor agreement executed by a creditor in favor of and acceptable to
the Administrative Agent and Lenders and acknowledged by the Borrower.

 

“Interest Payment Date” means:  (a) with respect to:  (i) a Eurodollar Rate Loan, the last day
of each Interest Period applicable thereto and, in the case of a Eurodollar
Rate Loan 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, (ii) a Base
Rate Loan (other than a Swing Line Loan), the last Business Day of each
calendar month; and (iii) a Swing Line Loan, the last Business Day of each
calendar month; and (b) (i) in the case of Working Capital Loans, the
Working Capital Maturity Date and (ii) in the case of Floorplan Loans and
Swing Line Loans, the Floorplan Maturity Date.

 

“Interest Period” means, as to each
Eurodollar Rate Loan, the period commencing on the date such Eurodollar Rate
Loan is disbursed or converted to or continued as a Eurodollar Rate Loan and
ending on the date one, two, three or six months thereafter, as selected by
Borrower in its related Loan Notice; provided
that:  (a) any Interest Period that
would otherwise end on a day that is not a Business Day shall be extended to
the next succeeding Business Day unless such Business Day falls in another
calendar month, in which case such Interest Period shall end on the next
preceding Business Day; (b) any Interest Period that begins on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall end on the last Business Day of the calendar month at the end of such
Interest Period; (c) no Interest Period for:  (i) any Working Capital Loan shall
extend beyond the Working Capital Maturity Date; and (ii) any Floorplan
Loan shall extend beyond the Floorplan Maturity Date.

 

“Investment” means, as to any Person,
any direct or indirect acquisition or investment by such Person in another
Person, whether by means of: 
(a) the purchase or other acquisition of Equity Interests or other
securities of another Person; (b) a loan, advance or capital contribution
to, Guarantee or assumption of debt of, or purchase or other acquisition of any
other debt or equity participation or interest in, another Person, including
any partnership or limited liability company interest in such other

 

20

 

Person
and any arrangement pursuant to which the investor Guarantees Debt of such
other Person; or (c) the purchase or other acquisition (in one transaction
or a series of transactions) of assets of another Person that constitute a
business unit.  For purposes of covenant
compliance, the amount of any Investment shall be the amount actually invested,
without adjustment for subsequent increases or decreases in the value of such Investment.

 

“IRS” means the United States
Internal Revenue Service.

 

“ISP” means, with respect to any
Letter of Credit, the “International Standby Practices 1998” published by the
Institute of International Banking Law & Practice (or, if the L/C
Issuer shall agree at the time of issuance, such later version thereof as may
be in effect at the time of issuance).

 

“Issuer Documents” means, with
respect to any Letter of Credit, the L/C Application relating thereto and
any other document entered into by L/C Issuer and Borrower or in favor of
L/C Issuer and relating to any such Letter of Credit.

 

“Joinder Agreement” means an
agreement entered into by a Subsidiary of Borrower following the date hereof to
join in the Guaranty set forth in Section 10.14,
in substantially the form of Exhibit C
or any other form approved by Administrative Agent.

 

“Laws” means, collectively, all
international, foreign, Federal, state and local statutes, treaties, rules,
guidelines, regulations, ordinances, codes and administrative or judicial
precedents or authorities, including the interpretation or administration
thereof by any Governmental Authority charged with the enforcement,
interpretation or administration thereof, and all applicable administrative
orders, directed duties, requests, licenses, authorizations and permits of, and
agreements with, any Governmental Authority, in each case whether or not having
the force of law.

 

“L/C Advance” means a Working
Capital Lender’s funding of its participation in an L/C Borrowing in
accordance with its Working Capital Percentage Share.

 

“L/C Application” means an
application and agreement for the issuance or amendment of a Letter of Credit
in the form from time to time in use by L/C Issuer.

 

“L/C Borrowing” means an
extension of credit resulting from a drawing under any Letter of Credit that
has not been reimbursed on the date when made or refinanced as a Working
Capital Borrowing.

 

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

 

“L/C Expiration Date” means the
day that is ten days prior to the Working Capital Maturity Date then in effect
(or, if such day is not a Business Day, the next preceding Business Day).

 

“L/C Fee” has the meaning
ascribed thereto in Section 2.03(i).

 

21

 

“L/C Issuer” means, at any time,
the issuer of Letters of Credit hereunder (which, initially, shall be Wells
Fargo).

 

“L/C Obligations” means, at any
time, the sum of:  (a) the aggregate
amount available to be drawn under all outstanding Letters of Credit; plus (b) the aggregate of all Unreimbursed Amounts,
including all L/C Borrowings.  For
purposes of computing the amount available to be drawn under any Letter of
Credit, the amount of such Letter of Credit shall be determined in accordance
with Section 1.02(i).  For all purposes of this Agreement, if at any
time of determination a Letter of Credit has expired by its terms but any
amount may still be drawn thereunder by reason of the operation of
Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be “outstanding”
in an amount equal to the amount remaining available to be drawn.

 

“L/C Sublimit” means an amount
equal to $5,000,000.  The
L/C Sublimit is part of, and not in addition to, the Aggregate Working
Capital Commitments.

 

“Lender” means, as applicable, a
Working Capital Lender or a Floorplan Lender.

 

“Lending Office” means, as to any
Lender, the office or offices of such Lender described as such in such Lender’s
Administrative Detail Form, or such other office or offices as a Lender may
from time to time notify Borrower, Administrative Agent and Lending Parties.

 

“Lending Parties” means,
collectively, Lenders, Swing Line Lender and L/C Issuer.

 

“Letter of Credit” means any standby
letter of credit issued hereunder and shall include the Existing Letters of
Credit.

 

“Lien” means any mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
other), charge, or preference, priority or other security interest or
preferential arrangement in the nature of a security interest of any kind or
nature whatsoever (including any conditional sale or other title retention
agreement and any easement, right of way or other encumbrance on title to real
property).

 

“Loan” means any Working Capital
Loan, Floorplan Loan or Swing Line Loan.

 

“Loan Documents” means, collectively,
this Agreement, each Note, each Issuer Document, each Collateral Document, the
Treasury Management Service Documents and the Fee Letter.

 

“Loan Notice” means a notice,
pursuant to Section 2.02(a), of:  (a) a borrowing of Loans; (b) a
conversion of Loans from one Type to the other; or (c) a continuation of
Eurodollar Rate Loans; which, if in writing, shall be substantially in the form
of Exhibit D.

 

“Loan Parties” means, collectively,
Borrower and all Guarantors.

 

“Material Adverse Effect” means any
of the following:  (a) a material
adverse change in, or material adverse effect upon, the business, condition
(financial or otherwise), operations, performance, properties or prospects of
either:  (i) Borrower; or
(ii) the Loan Parties taken as a whole; (b) a material 

 

22

 

impairment
of the ability of either Borrower or the Loan Parties, taken as a whole, to
perform their respective obligations under the Loan Documents; or (c) a
material adverse effect upon: 
(i) the legality, validity, binding effect or enforceability of any
Loan Document to which any Loan Party is a party against either:  (A) Borrower; or (B) the Loan
Parties taken as a whole; or (ii) the rights and remedies of
Administrative Agent or any Lending Party under or in respect of any Loan
Document.

 

“Maximum Rate” means, at any
time, the maximum rate of non-usurious interest permitted by applicable Law.

 

“Multiemployer Plan” means any
employee benefit plan of the type described in Section 4001(a)(3) of
ERISA to which Borrower or any ERISA Affiliate makes or is obligated to make
contributions, or during the preceding five plan years, has made or been
obligated to make contributions.

 

“Net Proceeds” means, in respect of
any Disposition or Event of Loss, the proceeds in cash or Cash Equivalents
received by Borrower or any Subsidiary thereof with respect to or on account of
such Disposition or Event of Loss, net of: 
(a) in the case of a Disposition, the direct costs of such
Disposition then payable by the recipient of such proceeds, or, in the case of
an Event of Loss, the direct costs of collecting insurance or other proceeds,
in each case excluding amounts payable to Borrower or any Affiliate of
Borrower; (b) sales, use and other taxes paid or payable by such recipient
as a result thereof; and (c) amounts required to be applied to repay
principal, interest and prepayment premiums and penalties on Debt secured by a
Permitted Lien on the properties subject to such Disposition.

 

“Note” means any promissory note
executed by Borrower in favor of a Lender pursuant to Section 2.11
in substantially the form of Exhibit E.

 

“Obligations” means all advances, debts,
liabilities, obligations, covenants and duties, including treasury management
obligations, of any Loan Party to Administrative Agent or any Lending Party
under or in respect of any Loan Document or otherwise, whether with respect to
any Loan or Letter of Credit, whether direct or indirect (including those
acquired by assumption), absolute or contingent, due or to become due, now
existing or hereafter arising and including interest and fees that accrue after
the commencement by or against any Loan Party or any Affiliate thereof of any
proceeding under any Bankruptcy Law naming such Person as the debtor in such
proceeding, regardless of whether such interest and fees are allowed claims in
such proceeding.

 

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

 

“Other Taxes” means all present or
future stamp, intangible or documentary taxes or any other excise or property
taxes, charges or similar levies arising from any payment made hereunder or
under any 

 

23

 

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

 

“Outstanding Amount” means:  (a) with respect to any Loans on any
date, the aggregate outstanding principal amount thereof after giving effect to
any Borrowings and prepayments or repayments of such Loans, as the case may be,
occurring on such date; and (b) with respect to any L/C Obligations
on any date, the amount of such L/C Obligations on such date after giving
effect to any L/C Credit Extension occurring on such date and any other
changes in the aggregate amount of the L/C Obligations as of such date,
including as a result of any reimbursements by Borrower of Unreimbursed
Amounts.

 

“Participant” means any Person other
than (i) a natural person, (ii) Borrower or any of Borrower’s
Affiliates or (iii) any competitor of Borrower or any of its Subsidiaries
or any of such Person’s Affiliates.

 

“PBGC” means the Pension Benefit
Guaranty Corporation.

 

“Pension Plan” means any “employee
pension benefit plan” (as that term is defined in Section 3(2) of
ERISA), other than a Multiemployer Plan, that is subject to Title IV of
ERISA and is sponsored or maintained by Borrower or any ERISA Affiliate or to
which Borrower or any ERISA Affiliate contributes or has an obligation to
contribute, or in the case of a multiple employer or other plan described in
Section 4064(a) of ERISA, has made contributions at any time during
the immediately preceding five plan years.

 

“Percentage Share” means, as to
any Lender, its Working Capital Percentage Share or Floorplan Percentage Share,
as applicable.

 

“Perfection Certificate” shall mean
the Perfection Certificate substantially in the form of Exhibit A
to the Security Agreement.

 

“Permitted Acquisition” means any
Acquisition so long as:  (a) such
Acquisition is undertaken in accordance with all applicable Laws; (b) no
Default exists immediately prior to, or would exist immediately after, giving
effect to such Acquisition; (c) in connection with such Acquisition,
Borrower has obtained, effective written consent of the board of directors or
equivalent governing body of the Person or business so acquired (the “Acquiree”) if required under
applicable corporate/company law or the Borrower’s Organizational Documents;
(d) the Acquiree (or the business unit or division of the Acquiree to be
acquired) shall be engaged principally in the same business as Borrower or the
Subsidiary of Borrower proposing to effect such Acquisition or a Related
Business; (e) the aggregate cash and non-cash consideration to be paid by
Borrower and any Subsidiary thereof (whether in one or a series of
transactions) for such Acquisition does not exceed (i) 10% of the Borrower’s
Consolidated Total Assets for any one Acquisition or (ii) 20% of the
Borrower’s Consolidated Total Assets for all Acquisitions in each fiscal year;
(f) upon the closing of such Acquisition in the case of a Permitted
Material Acquisition, a Responsible Officer of Borrower delivers to
Administrative Agent and Lenders: 
(i) a certificate to the effect that each of clauses (a) through
(e), inclusive, of this definition has been satisfied; (ii) a copy of the
resolutions or consent required to be obtained by (c); (iii) a certificate
detailing pro forma compliance with all financial covenants set forth in Section 6.12 for each of the Fiscal Periods which
remain in such 

 

24

 

fiscal
year following the consummation of such Acquisition; (iv) the consolidated
earnings before interest, taxes, depreciation and amortization of the Loan
Parties, including the Acquiree (or the business unit or division of the
Acquiree to be acquired), must be positive on a pro forma
basis for each of the Fiscal Periods which remain in such fiscal year following
the consummation of such Acquisition; and (v) a three year financial
forecast for the Acquiree; and (g) within 30 days after the closing of
such Acquisition in the case of any other Acquisition that is not a Permitted
Material Acquisition, a Responsible Officer of Borrower delivers to
Administrative Agent and Lenders: (i) a certificate to the effect that
each of clauses (a) through (e), inclusive, of this definition has been
satisfied; and (ii) a copy of the resolutions or consent required to be
obtained by (c).

 

“Permitted Debt” mean any Debt
permitted by Section 7.03.

 

“Permitted Discretion” shall mean the
Administrative Agent’s commercially reasonable judgment, exercised in good
faith in accordance with customary business practices for asset-based
lending transactions; provided that any standard of eligibility or
reserve established or modified by the Administrative Agent shall have a
reasonable relationship to circumstances, conditions, events or contingencies
which are the basis for such standard of eligibility or reserve, as reasonably
determined, without duplication and for so long as they continue, by the
Administrative Agent in good faith.

 

“Permitted Floorplan Debt” means the
floorplan Debt permitted pursuant to Section 7.03(i).

 

“Permitted Liens” has the meaning
ascribed thereto in Section 7.01.

 

“Permitted Material Acquisition”
means an Acquisition that is otherwise a Permitted Acquisition under clauses (a) through
(f) of the definition thereof and which the aggregate cash and non-cash
consideration to be paid by Borrower and any Subsidiary thereof (whether in one
or a series of transactions) for such Acquisition exceeds 5% of the Borrower’s
Consolidated Total Assets.

 

“Permitted Shortline Debt” means  floorplan facilities with short line manufacturers, or
facilities arranged by short line manufacturers for their products and services
with third party financing sources,  in
the ordinary course of business.

 

“Permitted Subordinated Debt” means
any Debt that has been subordinated to the Obligations on terms and conditions,
and pursuant to documents, satisfactory to Administrative Agent and Required
Lenders.

 

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

 

“Plan” means any “employee benefit
plan” (as such term is defined in Section 3(3) of ERISA) established
by Borrower or, with respect to any such plan that is subject to
Section 412 of the Code or Title IV of ERISA, any ERISA Affiliate.

 

“Register” means a register for the
recordation of the names and addresses of Lenders and, as applicable, the
Commitments of, and Outstanding Amounts of the Loans and L/C Obligations
owing to, each Lender pursuant to the terms hereof from time to time.

 

25

 

“Related Business” shall mean any
business that is the same, similar or otherwise reasonably related, ancillary
or complementary to the businesses of the Borrower and its Subsidiaries on the
Closing Date.

 

“Related Parties” means, with respect
to any Person, such Person’s Affiliates and the partners, members, directors,
officers, employees, agents and advisors of such Person and of such Person’s
Affiliates, and specifically includes, in the case of Wells Fargo, Wells Fargo
in its capacity as Administrative Agent, Arranger, Swing Line Lender and
L/C Issuer.

 

“Replacement Lender” has the meaning
ascribed thereto in Section 3.07(a)(iii).

 

“Reportable Event” means any of the
events set forth in Section 4043(c) of ERISA, other than events for
which the thirty-day notice period has been waived.

 

“Request for Credit Extension”
means:  (a) with respect to a
Borrowing, conversion or continuation of Working Capital Loans or Floorplan
Loans, a Loan Notice; (b) with respect to an L/C Credit Extension, an
L/C Application; and (c) with respect to a Swing Line Loan, a Swing
Line Loan Notice.

 

“Required Floorplan Lenders” means,
at any time:  (a) three or more
Floorplan Lenders holding in excess of 50.00% of the then Total Floorplan
Outstandings; or (b) if there are no Total Floorplan Outstandings, three
or more Floorplan Lenders holding in excess of 50.00% of the Aggregate
Floorplan Commitments; provided that
the Floorplan Commitment of, and the portion of the Total Floorplan
Outstandings held or deemed held by, any Defaulting Lender shall be excluded
for purposes of making a determination of Required Floorplan Lenders. provided further, at any time there is only one Floorplan
Lender, “Required Floorplan Lenders” shall mean
the sole Floorplan Lender.

 

“Required Lenders” means:  (a) at any time that Loans are
outstanding and the Aggregate Working Capital Commitments and Aggregate
Floorplan Commitments are in effect, three or more Lenders holding in excess of
50.00% of the sum of:  (i) the
Aggregate Working Capital Commitments; plus
(ii) the Aggregate Floorplan Commitments; (b) at any time that Loans
are outstanding but the Aggregate Working Capital Commitments have been
terminated, three or more Lenders holding in excess of 50.00% of the aggregate
Outstanding Amount of the Loans; (c) at any time that Loans are
outstanding but the Aggregate Floorplan Commitments have been terminated, three
or more Lenders holding in excess of 50.00% of the aggregate Outstanding Amount
of the Loans; (d) at any time on or prior to the Closing Date that no
Loans are outstanding, three or more Lenders holding in excess of 50.00% of the
Aggregate Commitments; and (e) at any time following the Closing Date that
no Loans are outstanding, three or more Lenders holding in excess of 50.00% of
the Aggregate Commitments; provided that
the Working Capital Commitment and/or Floorplan Commitment of, and the portion
of the Total Outstandings held or deemed held by, any Defaulting Lender shall
be excluded for purposes of making a determination of Required Lenders.

 

“Required Working Capital Lenders”
means, at any time:  (a) three or
more Working Capital Lenders holding in excess of 50.00% of the then Total
Working Capital Outstandings; or (b) if there are no Total Working Capital
Outstandings, three or more Working Capital Lenders holding in excess of 50.00%
of the Aggregate Working Capital Commitments; provided
that the Working Capital 

 

26

 

Commitment
of, and the portion of the Total Working Capital Outstandings held or deemed
held by, any Defaulting Lender shall be excluded for purposes of making a
determination of Required Working Capital Lenders.

 

“Responsible Officer” means:  (a) with respect to the Borrower in
connection with any Request for Credit Extension, any Compliance Certificate or
any other certificate or notice pertaining to any financial information
required to be delivery by Borrower hereunder, the chief financial officer,
treasurer or controller of Borrower; and (b) otherwise, with respect to Borrower
or any other Loan Party, the chief executive officer, president, chief
financial officer, vice president of finance, treasurer or controller of such
Person.

 

“Restricted Payment” means, as to any
Person, (a) any dividend or other distribution by such Person (whether in
cash, securities or other property) with respect to any Equity Interests of
such Person, (b) any payment (whether in cash, securities or other
property), including any sinking fund or similar deposit, on account of the
purchase, redemption, retirement, acquisition, cancellation or termination of
any such Equity Interest, (c) any payment of principal or interest or any
purchase, redemption, retirement, acquisition or defeasance with respect to any
Debt of such Person, which is subordinated to the payment of the Obligation
pursuant to a Subordination Agreement acceptable to the Administrative Agent,
in violation of any subordination provisions applicable thereto (it being
acknowledged that payments that are not restricted by the subordination provisions
applicable thereto are not Restricted Payments), (d) the acquisition for
value by such Person of any Equity Interests issued by such Person or any other
Person that Controls such Person and (e) with respect to clauses (a) through
(d), any transaction that has a substantially similar effect.

 

“Secured Parties” shall have the
meaning assigned to such term in any applicable Collateral Document.

 

“Security Documents” means,
collectively:  (a) the Security
Agreement, dated as of the Closing Date, executed by Borrower and Guarantors in
favor of Administrative Agent, substantially in the form of Exhibit G; (b) each deposit account control
agreement or securities account control agreement, each in form and substance
satisfactory to the Administrative Agent; (c) with respect to each Foreign
Subsidiary of a Loan Party, a Foreign Pledge Agreement, (d) each
intellectual property assignment or security agreement, each in form and
substance satisfactory to the Administrative Agent; and (e) any similar
document executed thereafter pursuant to the terms hereof or otherwise in
connection herewith after the Closing Date.

 

“Solvent” means, as to any Person at
any time, that:  (a) the fair value
of the property of such Person on a going concern basis is greater than the
amount of such Person’s liabilities (including contingent liabilities), as such
value is established and such liabilities are evaluated for purposes of
Section 101(32) of the Bankruptcy Code and, in the alternative, for
purposes of the Uniform Fraudulent Transfer Act or any similar state statute
applicable to Borrower or any Subsidiary thereof; (b) the present fair
salable value of the property of such Person is not less than the amount that
will be required to pay the probable liability of such Person on its debts as
they become absolute and matured; (c) such Person is able to realize upon
its property and pay its debts and other liabilities (including contingent
liabilities) as they mature in the normal course of business; (d) such
Person does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person’s ability to pay as such debts and liabilities

 

27

 

mature;
and (e) such Person is not engaged in business or a transaction, and is
not about to engage in business or a transaction, for which such Person’s
property would constitute unreasonably small capital.

 

“Specified Lender” means, at any
time, any Lender:  (a) that has
requested compensation under Section 3.04
and has not rescinded such request within five Business Days of the making
thereof; (b) to whom Borrower must pay an additional amount (or on whose
behalf Borrower must pay an additional amount to a Governmental Authority)
pursuant to Section 3.01; (c) that
gives a notice pursuant to Section 3.02;
(d) that is a Defaulting Lender; or (e) that is a Lender that may,
but does not, provide its consent to any matter as to which Required Lenders,
Required Working Capital Lenders or Required Floorplan Lenders, as applicable, may
give and have given their consent pursuant to Section 10.01;
or (f) that is the sole Lender that may but does not provide its consent
to any matter as to which all other Lenders may give and have given their
consent pursuant to Section 10.01.

 

“Specified Materials” means,
collectively, all materials or information provided by or on behalf of Borrower
or any Subsidiary thereof, as well as documents and other written materials
relating to Borrower, the Loan Parties or any of their respective Subsidiaries or
Affiliates or any other materials or matters relating to the Loan Documents
(including any amendments or waivers of the terms thereof or supplements
thereto).

 

“Subordinated Creditor” means each
Person now or in the future who agrees to subordinate indebtedness of the
Borrower held by that Person to the payment of the Obligations.

 

“Subordination Agreement” means a
subordination agreement executed by a Subordinated Creditor in favor of and
acceptable to the Administrative Agent and Lenders and acknowledged by the
Borrower.

 

“Subsidiary” of a Person means a
corporation, partnership, joint venture, limited liability company or other
business entity of which a majority of the shares of securities or other
interests having ordinary voting power for the election of directors or other
governing body (other than securities or interests having such power only by
reason of the happening of a contingency) are at the time beneficially owned,
or the management of which is otherwise Controlled, directly, or indirectly through
one or more intermediaries, or both, by such Person, provided that Subsidiaries
of Borrower shall be limited to such entities whose financial statements are
consolidated with the Borrower’s financial statements in accordance with GAAP
or with respect to which more than 50.00% of the Equity Interests therein are
owned directly or indirectly by Borrower. 
Unless otherwise specified, all references herein to a “Subsidiary” or to “Subsidiaries”
shall refer to a Subsidiary or Subsidiaries of Borrower.

 

“Subsidiary Guarantor” has the
meaning ascribed thereto in Section 10.14(a).

 

“Subsidiary Guarantor Subordinated Debt”
has the meaning ascribed thereto in Section 10.14(i).

 

“Subsidiary Guarantor Subordinated Debt Payments”
has the meaning ascribed thereto in Section 10.14(i).

 

28

 

“Supermajority Floorplan Lenders”
means, at any time:  (a) three or
more Floorplan Lenders holding in excess of 66.67% of the then Total Floorplan
Outstandings; or (b) if there are no Total Floorplan Outstandings, three
or more Floorplan Lenders holding in excess of 66.67% of the Aggregate
Floorplan Commitments; provided that
the Floorplan Commitment of, and the portion of the Total Floorplan
Outstandings held or deemed held by, any Defaulting Lender shall be excluded
for purposes of making a determination of Required Floorplan Lenders. provided further, at any time there is only one Floorplan
Lender, “Required Floorplan Lenders” shall mean
the sole Floorplan Lender.

 

“Supermajority Working Capital Lenders”
means, at any time:  (a) three or
more Working Capital Lenders holding in excess of 66.67% of the then Total
Working Capital Outstandings; or (b) if there are no Total Working Capital
Outstandings, three or more Working Capital Lenders holding in excess of 66.67%
of the Aggregate Working Capital Commitments; provided
that the Working Capital Commitment of, and the portion of the Total Working
Capital Outstandings held or deemed held by, any Defaulting Lender shall be
excluded for purposes of making a determination of Required Working Capital
Lenders.

 

“Swap Contract” means:  (a) any and all rate swap transactions,
basis swaps, credit derivative transactions, forward rate transactions,
commodity swaps, commodity options, forward commodity contracts, equity or
equity index swaps or options, bond or bond price or bond index swaps or
options or forward bond or forward bond price or forward bond index
transactions, interest rate options, forward foreign exchange transactions, cap
transactions, floor transactions, collar transactions, currency swap
transactions, cross-currency rate swap transactions, currency options, spot
contracts, or any other similar transactions or any combination of any of the
foregoing (including any options to enter into any of the foregoing), whether
or not any such transaction is governed by or subject to any master agreement;
and (b) any and all transactions of any kind, and the related
confirmations, that are subject to the terms and conditions of, or governed by,
any form of master agreement published by the International Swaps and
Derivatives Association, Inc., any International Foreign Exchange Master
Agreement, or any other master agreement including any such obligations or
liabilities under any such master agreement (in each case, together with any
related schedules).

 

“Swap Obligations” means all
liabilities and obligations of any Loan Party to Administrative Agent or any
Lending Party under a swap contract applicable to Borrowings advanced under the
Credit Agreement.

 

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

 

“Swing Line” means the revolving
credit facility made available by Swing Line Lender pursuant to Section 2.04.

 

29

 

“Swing Line Borrowing” means a
borrowing of a Swing Line Loan pursuant to Section 2.04.

 

“Swing Line Lender” means, at any time,
the provider of the Swing Line hereunder (which, initially, shall be Wells
Fargo).

 

“Swing Line Loan” has the meaning
ascribed thereto in Section 2.04(a).

 

“Swing Line Loan Notice” means a
notice of a Swing Line Borrowing pursuant to Section 2.04(b),
which, if in writing, shall be substantially in the form of Exhibit F.

 

“Swing Line Sublimit” means an amount
equal to the lesser of: 
(a) $15,000,000; and (b) the Aggregate Floorplan
Commitments.  The Swing Line Sublimit is
a part of, but is not in addition to, the Aggregate Floorplan Commitments.

 

“Synthetic Lease Obligation” means
the monetary obligation of a Person under either:  (a) a so-called synthetic, off-balance
sheet or tax retention lease; or (b) an agreement for the use or
possession of property creating obligations that do not appear on the balance
sheet of such Person but which, upon the insolvency or bankruptcy of such
Person, would be characterized as the indebtedness of such Person (without
regard to accounting treatment).

 

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

 

“Threshold Amount” means $5,000,000.00.

 

“Total Floorplan Outstandings” means,
at any time, the sum of: 
(a) Outstanding Amount of all Floorplan Loans; plus
(b) the Outstanding Amount of all Swing Line Loans.

 

“Total Outstandings” means, at any
time, the sum of:  (a) Total Working
Capital Outstandings; plus
(b) the Total Floorplan Outstandings.

 

“Total Working Capital Outstandings”
means, at any time, the sum of: 
(a) the aggregate Outstanding Amount of all Working Capital Loans; plus (b) the Outstanding Amount of all
L/C Obligations.

 

“Transactions” means on the Closing
Date (i) the execution, delivery and performance by each Loan Party of
each Loan Document to which it is a party, (ii) the borrowing of the Loans
and the issuance of the Letters of Credit, and (iii) the use of the proceeds
of the Loans and the Letters of Credit.

 

“Transportation Solutions” means
Transportation Solutions LLC, a North Dakota limited liability company.

 

“Treasury Management Service Documents”
means, at any time, the Master Agreement for Treasury Management Services
between Borrower and Wells Fargo, the related Acceptance of Services, 

 

30

 

Service
Descriptions, and any other documents or agreements now in effect or hereafter
entered into with respect to treasury management services provided to Borrower
by Wells Fargo.

 

“Type” means, with respect to any
Loan, its character as a Base Rate Loan or a Eurodollar Rate Loan.

 

“Uniform Commercial Code” means the
Uniform Commercial Code as in effect in any applicable jurisdiction.

 

“United States” and “U.S.” mean the United States of
America.

 

“Unreimbursed Amount” means, with
respect to any Letter of Credit, any amount drawn thereunder that Borrower has
failed to reimburse to L/C Issuer by 11:00 a.m. on the related Honor
Date.

 

“Wells Fargo” means WELLS FARGO BANK,
NATIONAL ASSOCIATION, a national banking association.

 

“Withdrawal Liability” shall mean
liability to a Multiemployer Plan as a result of a complete or partial
withdrawal from such Multiemployer Plan, as such terms are defined in Part I
of Subtitle E of Title IV of ERISA.

 

“Working Capital Availability” means,
at any time, the lesser of (a) the Aggregate Working Capital Commitments
at such time or (b) the Working Capital Borrowing Base at such time.

 

“Working Capital Availability Period”
means the period from the Closing Date to the Working Capital Maturity Date.

 

“Working Capital Borrowing” means a
borrowing consisting of simultaneous Working Capital Loans of the same Type
and, in the case of Eurodollar Rate Loans, having the same Interest Period made
by each Working Capital Lender pursuant to Section 2.01(a).

 

“Working Capital Borrowing Base”
means as of any date of calculation, an amount, as set forth on the most
current Borrowing Base Certificate delivered to the Administrative Agent, equal
to the sum of:

 

(a)                                  80% of Eligible
Accounts; plus

 

(b)                                 85% of the net
book value of Eligible Rental Equipment; plus

 

(c)                                  75% of (i) Eligible
Parts and Attachments Inventory minus (ii) the
CNH Parts Reserve; plus

 

(d)                                 50% of Eligible
Work in Process Inventory; minus

 

(e)                                  the Working
Capital Borrowing Base Reserve.

 

31

 

The
Borrower, Administrative Agent and the Lenders acknowledge and agree that
(i) the advance rates set forth in this definition are solely to establish
the parameters for Availability, and (ii) this definition does not
constitute nor shall it be deemed to constitute an express or implied
representation or determination by Lenders that the recovery in a forced liquidation
scenario would be equal to the advance rates established herein.

 

“Working
Capital Borrowing Base Reserve” means, as of any date of
determination, such amounts (expressed as either a specified amount or as a
percentage of a specified category or item) as the Administrative Agent may
from time to time establish and adjust in reducing Working Capital Availability
acting in its Permitted Discretion (a) to the extent to reasonably reflect
events, conditions, contingencies or risks that materially adversely affect (i) the
value of the Collateral consisting of that which is taken into account in
determining the Working Capital Borrowing Base, or (ii) the security
interests and other rights of the Administrative Agent or Lenders in such
Collateral (including the enforceability, perfection and priority thereof), or (b) to
the extent to reasonably reflect any collateral report or financial information
furnished by or on behalf of the Borrower to the Lenders that is or was
incomplete, inaccurate or misleading in any material respect that affects such
Collateral’s value that has not been cured after 10 days prior written notice
thereof to the Borrower, or (c) in respect of any Default or an Event of
Default during the continuation thereof; provided that (x) any such
required reserves shall continue only for so long as the events, conditions,
contingencies or risks giving rise thereto continue, (y) the
Administrative Agent shall give Borrower the lesser of 45 days notice (or if 45
days notice would cause such reserve not to be reflected on the second
Borrowing Base Certificate required to be delivered after the date thereof, the
number of days which would cause such reserve to be so reflected) of any
increase in any such reserves under clause (a)(i), and (z) in the case of
reserves required under clause (a)(i), upon delivery of notice to Borrower, as
provided above, the Administrative Agent shall be available to discuss the
proposed reserve, and Borrower may take such action as may be required so that
the event, condition or matter that is the basis for such reserve no longer
exists in a manner and to the extent reasonably satisfactory to the
Administrative Agent in the exercise of its Permitted Discretion.

 

“Working Capital Commitment” means,
as to each Working Capital Lender at any time any determination thereof is to
be made, its obligation to do the following pursuant to the terms hereof:  (a) make Working Capital Loans to
Borrower; and (b) purchase participations in L/C Obligations; all in
an aggregate principal amount at any one time outstanding not to exceed the
amount set forth opposite such Lender’s name on Schedule 2.01
or in the Assignment and Assumption pursuant to which such Lender became a
party hereto or pursuant to the applicable Additional Commitment Documentation,
as applicable, as such amount may be adjusted from time to time in accordance
with this Agreement.

 

“Working Capital Lender” means,
collectively, (a) initially, each Lender designated on Schedule 2.01  as
a “Working Capital Lender” and (b) each Lender that assumes a Working
Capital Commitment pursuant to an Assignment and Assumption or pursuant to the
applicable Additional Commitment Documentation or which otherwise holds a
Working Capital Commitment, a Working Capital Loan or a participation in a
Letter of Credit or a L/C Borrowing.

 

“Working Capital Loan” has the
meaning ascribed thereto in Section 2.01(a).

 

“Working Capital Maturity Date” means
the earliest of:  (a) October 31,
2014 or if applicable, any extension thereof pursuant to Section 2.16;
(b) the date of the termination of the Aggregate Working 

 

32

 

Capital
Commitments pursuant to Section 2.06;
and (c) the date of the termination of the Aggregate Working Capital
Commitments and of the obligation of L/C Issuer to make L/C Credit
Extensions pursuant to Section 8.02.

 

“Working Capital Percentage Share”
means as to any Working Capital Lender at any time, the percentage (expressed
as a decimal carried out to the ninth decimal place) of the Aggregate Working
Capital Commitments represented by such Lender’s Working Capital Commitment at
such time; provided that, if the commitment of each
Working Capital Lender to make Working Capital Loans and the obligation of
L/C Issuer to make L/C Credit Extensions have been terminated
pursuant to Section 8.02 or if the
Aggregate Working Capital Commitments have expired, then the Working Capital
Percentage Share of each Working Capital Lender shall be determined based upon
such Lender’s Working Capital Percentage Share most recently in effect, giving
effect to any subsequent assignments. 
The initial Working Capital Percentage Share of each Working Capital
Lender is set forth opposite the name of such Lender on Schedule 2.01
or in the Assignment and Assumption or the Additional Commitment Documentation
pursuant to which such Lender became a party hereto, as applicable.

 

When
used in this Agreement, each of the following terms shall have the respective
meaning ascribed thereto by the Uniform Commercial Code:  “Account”, “Account Debtor”, “Certificated Securities”, “Chattel Paper”, “Commercial Tort Claim”, “Deposit Account”, “Document”, “Equipment”,
“General Intangibles”, “Goods”, “Instrument”,
“Inventory”, “Investment
Property”, “Letter of Credit Right”,
“Proceeds”, “Record”,
“Secured Party”, “Security”, “Security
Certificate”, and “Supporting Obligation”.

 

SECTION 1.02                               CERTAIN
RULES OF CONSTRUCTION.

 

(a)           General Rules.

 

(i)            Unless the context
otherwise clearly requires, the meaning of a defined term is applicable equally
to the singular and plural forms thereof.

 

(ii)           The words “hereof,” “herein,”
“hereunder” and similar words refer
to this Agreement as a whole and not to any particular provision of this
Agreement.

 

(iii)          The word “documents” includes instruments, documents,
agreements, certificates, indentures, notices and other writings, however
evidenced.

 

(iv)          The words “include” and “including”
are not limiting and the word “or” is not exclusive.

 

(v)           In the computation
of periods of time from a specified date to a later specified date, the word “from” means “from
and including”; the words “to” and “until” each mean “to but excluding” and the word “through” means “to
and including.”

 

(vi)          Unless the context
otherwise clearly requires, the words “property,” “properties,” “asset”
and “assets” refer to both personal
property (whether tangible or intangible) and real property.

 

33

 

(vii)         Unless the context
otherwise clearly requires: 
(A) Article, Section, subsection, clause, Schedule and Exhibit references
are to this Agreement; (B) references to documents (including this
Agreement) shall be deemed to include all subsequent amendments and other
modifications thereto, but only to the extent such amendments and other modifications
are not prohibited by the terms of any Loan Document; (C) references to
any statute or regulation are to be construed as including all statutory and
regulatory provisions consolidating, amending, replacing, supplementing or
interpreting the statute or regulation; and (D) references to any Person
shall be deemed to include such Person’s successors and assigns.

 

(b)           Time and Fiscal Year
References.  Unless the
context otherwise clearly requires: 
(i) all references herein to times of day shall be references to
Pacific time (daylight or standard, as applicable); and (ii) all
references herein to “fiscal year”
refer to the fiscal year of Borrower.

 

(c)           Captions.  The captions and headings of
this Agreement are for convenience of reference only and shall not affect the
interpretation of this Agreement.

 

(d)           Cumulative Nature of
Certain Provisions.  This
Agreement and the other Loan Documents may use several different limitations,
tests or measurements to regulate the same or similar matters.  All such limitations, tests and measurements
are cumulative and shall be performed in accordance with their respective
terms.

 

(e)           No Construction
Against Any Party.  This
Agreement and the other Loan Documents are the result of negotiations among,
and have been reviewed by counsel to, the Loan Parties, Administrative Agent
and Lending Parties and are the products of all parties.  Accordingly, they shall not be construed
against Administrative Agent or any Lending Party merely because of the
involvement of any or all of the preceding Persons in their preparation.

 

(f)            GAAP.  Unless the context otherwise clearly
requires, all accounting terms not expressly defined herein shall be construed,
and all financial computations required under this Agreement shall be made, in
accordance with GAAP.  If at any time any change in GAAP
would affect the computation of any financial ratio or requirement set forth in
any Loan Document, and either Borrower or Required Lenders shall so request,
Administrative Agent, Lending Parties and Borrower shall negotiate in good
faith to amend such ratio or requirement to preserve the original intent
thereof in light of such change in GAAP (subject to the approval of Required
Lenders); provided that, until so amended:  (i) such ratio or requirement shall
continue to be computed in accordance with GAAP prior to such change therein;
and (ii) Borrower shall provide to Administrative Agent and Lending
Parties financial statements and other documents required under this Agreement
or as reasonably requested hereunder setting forth a reconciliation between
calculations of such ratio or requirement made before and after giving effect
to such change in GAAP.

 

(g)           Rounding.  Any financial ratios required to be
maintained by the Loan Parties or any of them pursuant to the Loan Documents
shall be calculated by dividing the appropriate component by the other
component, carrying the result to one place more than the number of places by
which such ratio is expressed herein and rounding the result up or down to the nearest
number using the common — or symmetric arithmetic — method of rounding (in
other words, rounding-up if there is no nearest number).

 

34

 

(h)           Computations of
Certain Financial Covenants.  For purposes of computing the Consolidated
Fixed Charge Coverage Ratio as of any date, following an Acquisition, Borrower
shall compute components of such ratios, financial results (without duplication
of amounts) attributable to any business or assets the subject of any such
Acquisition by Borrower or any Subsidiary thereof effected during such period
in the same manner that Borrower accounts for such Acquisition for purposes of
complying with applicable securities laws and regulations (including, if
applicable, pursuant to SX Rule 3-05).

 

(i)            Calculations with
Respect to Letters of Credit.  Unless otherwise specified herein the amount
of a Letter of Credit at any time shall be deemed to be the stated amount of
such Letter of Credit in effect at such time; provided
that, with respect to any Letter of Credit that, by its terms or the terms of
any Issuer Document related thereto, provides for one or more automatic
increases in the stated amount thereof, the amount of such Letter of Credit
shall be deemed to be the maximum stated amount of such Letter of Credit after
giving effect to all such increases, whether or not such maximum stated amount
is in effect at such time.

 

(j)            Documents Executed
by Responsible Officers.   Any
document delivered hereunder that is signed by a Responsible Officer of a Loan
Party shall be conclusively presumed to have been authorized by all necessary
corporate or other organizational action on the part of such Loan Party and
such Responsible Officer shall be conclusively presumed to have acted on behalf
of such Loan Party.

 

ARTICLE II

CREDIT EXTENSIONS

 

SECTION 2.01                               WORKING
CAPITAL LOANS; FLOORPLAN LOANS.

 

Subject
to the terms and conditions set forth herein:

 

(a)              Working Capital
Loans.  Each Working Capital Lender
severally agrees to make loans (each such loan, a “Working
Capital Loan”) to Borrower, from time to time on any Business
Day during the Working Capital Availability Period, in an aggregate outstanding
amount not to exceed at any time such Lender’s Working Capital Commitment, provided that, after giving effect to any Working Capital
Borrowing:  (i) the Total Working
Capital Outstandings shall not exceed Working Capital Availability; and
(ii) the aggregate Outstanding Amount of the Working Capital Loans of any
Working Capital Lender, plus such
Lender’s Working Capital Percentage Share multiplied by
the Outstanding Amount of all L/C Obligations.  Within the limits of each Working Capital
Lender’s Working Capital Commitment, and subject to the other terms and
conditions hereof, Borrower may borrow under this Section 2.01,
prepay under Section 2.05, and reborrow
under this Section 2.01.  Working Capital Loans may be Base Rate Loans
or Eurodollar Rate Loans, as further provided herein.

 

(b)           Floorplan Loans.  Each Floorplan Lender severally agrees to
make loans (each such loan, a “Floorplan Loan”)
to Borrower, from time to time on any Business Day during the Floorplan
Availability Period, in an aggregate outstanding amount not to exceed at any
time such Lender’s Floorplan Commitment, provided that,
after giving effect to any Floorplan Borrowing: 
(i) the Total Floorplan Outstandings shall not exceed Floorplan
Availability; and (ii) the aggregate Outstanding

 

35

 

Amount
of the Floorplan Loans of any Floorplan Lender plus
such Lender’s Floorplan Percentage Share multiplied by
the Outstanding Amount of all Swing Line Loans shall not exceed such Lender’s
Floorplan Commitment .  Within the limits
of each Floorplan Lender’s Floorplan Commitment, and subject to the other terms
and conditions hereof, Borrower may borrow under this Section 2.01,
prepay under Section 2.05, and reborrow
under this Section 2.01.  Floorplan Loans may be Base Rate Loans or
Eurodollar Rate Loans, as further provided herein.

 

(c)           Intentionally
Omitted.

 

(d)           Repayment
of Existing Facilities to be Paid Off.  Borrower confirms and acknowledges its
obligation to pay all amounts due under the Existing Facilities to be Paid Off
and covenants and agrees that the proceeds of the initial Credit Extensions
under this Agreement shall be used to pay all principal and accrued interest
(if any) and all other amounts due under the Existing Facilities to be Paid Off
on the Closing Date.

 

(e)           Loans
Generally.  Each Loan
shall be made as part of a Borrowing consisting of Loans made by the Lenders
ratably in accordance with their applicable Working Capital Commitments or
Floorplan Commitments, provided, however, that the failure of any Lender to make any Loan
shall not in itself relieve any other Lender of its obligation to lend
hereunder (it being understood, however, that no Lender shall be responsible
for the failure of any other Lender to make any Loan required to be made by
such other Lender).

 

SECTION 2.02                               PROCEDURES
FOR BORROWING.

 

(a)           Notices
of Borrowing, Conversion and Continuation.  Each Borrowing (other than a Swing Line
Borrowing), each conversion of Loans from one Type to the other and each
continuation of Eurodollar Rate Loans shall be made upon Borrower’s irrevocable
notice to Administrative Agent, which may, subject to the provisions of Section 10.02(b) and Section 10.02(d),
be given by telephone or by approved electronic communication.  Each such notice must be received by
Administrative Agent not later than 11:00 a.m.:  (i) three Business Days prior to the
requested date of any Borrowing (other than a Swing Line Borrowing) of,
conversion to or continuation of Eurodollar Rate Loans or of any conversion of
Eurodollar Rate Loans to Base Rate Loans; and (ii) one Business Day prior
to the requested date of any Borrowing (other than a Swing Line Borrowing) of
Base Rate Loans.  Notwithstanding
anything to the contrary contained herein, but subject to the provisions of Section 10.02(b) and Section 10.02(d),
any telephonic notice or other electronic communication by Borrower pursuant to
this Section 2.02(a) may be given
by an individual who has been authorized in writing to do so by an appropriate
Responsible Officer of Borrower.  Each
such telephonic notice or other electronic communication must be confirmed
promptly by delivery to Administrative Agent of a written Loan Notice,
appropriately completed and signed by an appropriate Responsible Officer of
Borrower.

 

(b)           Amount
of Borrowing, Conversion or Continuation.  Each Borrowing (other than a Swing Line
Borrowing) of, conversion to or continuation of Eurodollar Rate Loans shall be
in a principal amount of $1,000,000.00 or a whole multiple of $500,000.00 in
excess thereof.  Except as provided in Sections 2.03(c) and Section 2.04(c),
each Borrowing of or conversion to Base Rate Loans shall be in a principal
amount of $500,000.00 or a whole multiple of $100,000.00 in excess thereof.

 

36

 

(c)           Loan
Notices Generally.  Each Loan
Notice (whether telephonic or written) shall specify:  (i) whether Borrower is requesting:  (A) a Working Capital Borrowing or a
Floorplan Borrowing; (B) a conversion of outstanding Loans from one Type
to the other; or (C) a continuation of Eurodollar Rate Loans;
(ii) the requested date (which shall be a Business Day) of such Borrowing,
conversion or continuation, as the case may be; (iii) the principal amount
of the Loans to be borrowed, converted or continued; (iv) the Type of Loans
to be borrowed or to which existing Loans are to be converted; and (v) if
applicable, the duration of the Interest Period with respect thereto.  If Borrower fails to specify a Type of Loan
in a Loan Notice or if Borrower fails to give a timely notice requesting a conversion
or continuation, then the applicable Loan(s) shall be made as, or
converted to, Base Rate Loans using the Daily LIBOR Rate.  Any such automatic conversion to Base Rate
Loans shall be effective as of the last day of the Interest Period then in
effect with respect to the applicable Eurodollar Rate Loans.  If Borrower requests a Borrowing of,
conversion to, or continuation of Eurodollar Rate Loans in any such Loan
Notice, but fails to specify an Interest Period, it will be deemed to have
specified an Interest Period of one month.

 

(d)           Procedures
Concerning the Making of Loans.  Following receipt of a Loan Notice,
Administrative Agent shall promptly notify each applicable Lender of the amount
of its Applicable Percentage Share of the requested Borrowings.  If Borrower does not timely provide notice of
a conversion or continuation, then Administrative Agent shall notify each
applicable Lender of the details of any automatic conversion to Base Rate Loans
described in the preceding subsection. 
Each Lender shall make the amount of its applicable Loan available to
Administrative Agent in immediately available funds at Administrative Agent’s
Office not later than 1:00 p.m. on the Business Day specified in the
applicable Loan Notice.  Upon
satisfaction of the applicable conditions set forth in Section 4.02
(and, if such Borrowing is the initial Credit Extension, Section 4.01),
Administrative Agent shall make all funds so received available to Borrower in
like funds as received by Administrative Agent either by:  (i) crediting the account of Borrower on
the books of Wells Fargo with the amount of such funds; or (ii) wire
transfer of such funds, in each case in accordance with instructions provided
to (and reasonably acceptable to) Administrative Agent by Borrower; provided that, if, on the date the Loan Notice with respect
to such Borrowing is given by Borrower, there are L/C Borrowings
outstanding, then the proceeds of such Borrowing shall be applied, first, to the payment in full of any such
L/C Borrowings and, second, to
Borrower as provided in this subsection.

 

(e)           Special
Provisions Applicable to Continuation or Conversions of Eurodollar Rate
Loans.  Except as otherwise provided
herein, a Eurodollar Rate Loan may be continued or converted only on the last
day of an Interest Period for such Eurodollar Rate Loan.  During the existence of an Event of
Default:  (i) no Loans may be
requested as, converted to or continued as Eurodollar Rate Loans without the
consent of Required Lenders; and (ii) Required Working Capital Lenders may
demand that any or all of the then outstanding Working Capital Loans that are
Eurodollar Rate Loans be converted immediately to Base Rate Loans, whereupon
Borrower shall pay any amounts due under Section 3.05
in accordance with the terms thereof due to any such conversion.

 

(f)            Notification
of Interest Rate. 
Administrative Agent shall promptly notify Borrower and the applicable
Lenders of the interest rate applicable to any Interest Period for Eurodollar
Rate Loans upon determination of such interest rate.

 

37

 

(g)           Limitation
on Interest Periods.  After giving
effect to all Borrowings, all conversions of Loans from one Type to the other,
and all continuations of Loans as the same Type, there shall not be more than
five (5) Interest Periods in effect with respect to Working Capital Loans
and Floorplan Loans.

 

SECTION 2.03                               LETTERS
OF CREDIT.

 

(a)           Letter
of Credit Subfacility. 
Subject to the terms and conditions set forth herein:

 

(i)            L/C Issuer
agrees, in reliance upon the agreements of the Working Capital Lenders set
forth in this Section 2.03:  (A) from time to time on any Business
Day during the period from the Closing Date until the L/C Expiration Date,
to issue Letters of Credit for the account of Borrower, and to amend or extend
Letters of Credit previously issued by it, in accordance with subsection
(b) of this Section 2.03; and (B) to
honor drawings under the Letters of Credit. 
All Existing Letters of Credit shall be deemed to have been issued
pursuant hereto and, from and after the Closing Date, shall be subject to and
governed by the terms and conditions hereof.

 

(ii)           Each Working
Capital Lender severally agrees to participate in Letters of Credit issued by
L/C Issuer and any drawings thereunder; provided
that, after giving effect to any L/C Credit Extension with respect to any
Letter of Credit:  (A) the Total
Working Capital Outstandings shall not exceed Working Capital Availability;
(B) the aggregate Outstanding Amount of the Working Capital Loans of any
Working Capital Lender, plus an amount
equal to such Lender’s Working Capital Percentage Share multiplied
by the Outstanding Amount of all L/C Obligations shall not
exceed such Lender’s Working Capital Commitment; or (C) the Outstanding
Amount of the L/C Obligations shall not exceed the L/C Sublimit.  Each request by Borrower for the issuance or
amendment of a Letter of Credit shall be deemed to be a representation by
Borrower that the requested L/C Credit Extension complies with the conditions
set forth in the proviso to the preceding sentence.  Within the foregoing limits, and subject to
the terms and conditions hereof, Borrower’s ability to obtain Letters of Credit
shall be fully revolving, and, accordingly, Borrower may, during the foregoing
period, obtain Letters of Credit to replace Letters of Credit that have expired
or that have been drawn upon and reimbursed.

 

(iii)          Subject to Section 2.03(b)(iv), L/C Issuer shall not issue
any Letter of Credit, if:  (A) the
expiry date of such requested Letter of Credit would occur more than twelve
months after the date of issuance or last extension, unless Required Working
Capital Lenders shall have approved such expiry date; or (B) the expiry
date of such requested Letter of Credit would occur after the
L/C Expiration Date, unless all Working Capital Lenders shall have
approved such expiry date.

 

(iv)          L/C Issuer
shall not have any obligation to issue a Letter of Credit if:

 

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

 

38

 

credit
generally or such Letter of Credit in particular or shall impose upon
L/C Issuer with respect to such Letter of Credit any restriction, reserve
or capital requirement (for which L/C Issuer is not otherwise compensated
hereunder) not in effect on the Closing Date, or shall impose upon
L/C Issuer any unreimbursed loss, cost or expense that was not applicable
on the Closing Date and which L/C Issuer in good faith deems material to
it;

 

(B)           the issuance of such Letter of Credit would violate
one or more policies of L/C Issuer;

 

(C)           such Letter of Credit:  (1) is to be denominated in a currency
other than Dollars; or (2) is a commercial letter of credit;

 

(D)          any Working Capital Lender is in default of its
obligation to fund under Section 2.03(d) or
any Working Capital Lender is at such time a Defaulting Lender hereunder,
unless L/C Issuer has entered into satisfactory arrangements with Borrower
or such Working Capital Lender to eliminate L/C Issuer’s risk with respect
to such Lender; or

 

(E)           unless specifically provided for in this Agreement,
such Letter of Credit contains any provisions for automatic reinstatement of
the stated amount after any drawing thereunder.

 

(v)           L/C Issuer
shall not amend any Letter of Credit if L/C Issuer would not be permitted
at such time to issue such Letter of Credit in its amended form under the terms
hereof.

 

(vi)          L/C Issuer
shall not have any obligation to amend any Letter of Credit if:   (A) L/C Issuer would have no
obligation at such time to issue such Letter of Credit in its amended form
under the terms hereof; or (B) the beneficiary of such Letter of Credit
does not accept the proposed amendment to such Letter of Credit.

 

(vii)         L/C Issuer
shall act on behalf of all Working Capital Lenders with respect to any Letters
of Credit issued by it and the documents associated therewith, and
L/C Issuer shall have all of the benefits and immunities:  (A) provided to Administrative Agent in Article IX with respect to any acts taken or omissions
suffered by L/C Issuer in connection with Letters of Credit issued by it
or proposed to be issued by it and Issuer Documents pertaining to such Letters
of Credit as fully as if the term “Administrative Agent”
as used in Article IX included
L/C Issuer with respect to such acts or omissions; and (B) as
additionally provided herein with respect to L/C Issuer.

 

(b)           Procedures
for Issuance and Amendment of Letters of Credit; Automatic Extensions of
Letters of Credit.

 

(i)            Each Letter of
Credit shall be issued or amended, as the case may be, upon the request of
Borrower delivered to L/C Issuer (with a copy to Administrative Agent) in
the form of an L/C Application, appropriately completed and signed by a
Responsible Officer of Borrower.  

 

39

 

Such
L/C Application must be received by L/C Issuer and Administrative
Agent not later than 11:00 a.m. at least two Business Days (or such later
date and time as may be agreed to by each of Administrative Agent and
L/C Issuer, each in its sole discretion) prior to the proposed issuance
date or date of amendment, as the case may be. 
In the case of a request for an initial issuance of a Letter of Credit,
such L/C Application shall specify in form and detail satisfactory to
L/C Issuer:  (A) the proposed
issuance date of the requested Letter of Credit (which shall be a Business
Day); (B) the amount thereof; (C) the expiry date thereof;
(D) the name and address of the beneficiary thereof; (E) the
documents to be presented by such beneficiary in case of any drawing
thereunder; (F) the full text of any certificate to be presented by such
beneficiary in case of any drawing thereunder; and (G) such other matters
as L/C Issuer may require.  In the
case of a request for an amendment of any outstanding Letter of Credit, such
L/C Application shall specify in form and detail satisfactory to
L/C Issuer:  (1) the Letter of
Credit to be amended; (2) the proposed date of the amendment thereof
(which shall be a Business Day); (3) the nature of the proposed amendment;
and (4) such other matters as L/C Issuer may require.  Additionally, Borrower shall furnish to
L/C Issuer and Administrative Agent such other documents and information
pertaining to such requested Letter of Credit issuance or amendment, including
any Issuer Documents, as L/C Issuer or Administrative Agent may require.

 

(ii)           Promptly after
receipt of any L/C Application at the address provided for pursuant to Section 10.02 for receiving L/C Applications and
related correspondence, L/C Issuer will confirm with Administrative Agent
(by telephone or in writing) that Administrative Agent has received a copy of
such L/C Application from Borrower and, if not, L/C Issuer will
provide Administrative Agent with a copy thereof.  Unless L/C Issuer has received written
notice from any Working Capital Lender, Administrative Agent or any Loan Party
at least one Business Day prior to the requested date of issuance or amendment
of the applicable Letter of Credit that one or more applicable conditions in Article IV shall not then be satisfied, then, subject
to the terms and conditions hereof, L/C Issuer shall, on the requested
date, issue the Letter of Credit requested by Borrower or enter into the
applicable amendment, as the case may be, in each case in accordance with
L/C Issuer’s usual and customary business practices.  Immediately upon the issuance of each Letter
of Credit, each Working Capital Lender shall be deemed to, and hereby
irrevocably and unconditionally agrees to, purchase from L/C Issuer a risk
participation in such Letter of Credit equal to such Lender’s Working Capital
Percentage Share multiplied by the face amount of
such Letter of Credit.

 

(iii)          Promptly after
its delivery of any Letter of Credit or any amendment to a Letter of Credit to
an advising bank with respect thereto or to the beneficiary thereof,
L/C Issuer will also deliver to Borrower and Administrative Agent a true
and complete copy of such Letter of Credit or amendment.

 

(iv)          If Borrower
specifically requests in any applicable L/C Application, L/C Issuer
may issue an Automatic Extension Letter of Credit.  Unless otherwise directed by L/C Issuer,
Borrower shall not be required to make a specific request to L/C Issuer
for any such extension.  Once an
Automatic Extension Letter of Credit has been issued, Working Capital Lenders
shall be deemed to have authorized (but may not require) L/C Issuer to
permit the extension of such Letter of Credit at any time to an expiry date not
later than the L/C Expiration Date; provided that
L/C Issuer shall not permit any such extension if:  (A) L/C Issuer has determined that
it

 

40

 

would
not be permitted, or would have no obligation, at such time to issue such
Letter of Credit in its revised form (as extended) under the terms hereof (by
reason of the provisions of Section 2.03(a) or
otherwise); or (B) L/C Issuer has received notice (which may be by
telephone or in writing) on or before the day that is thirty days before any
date provided for in such Automatic Extension Letter of Credit as the last day
by which notice of the non-extension thereof must be given: (1) from
Administrative Agent that Required Working Capital Lenders have elected not to
permit such extension; or (2) from Administrative Agent, any Working
Capital Lender or Borrower that one or more of the applicable conditions
specified in Section 4.02 is not then
satisfied, and in each such case directing L/C Issuer not to permit such
extension.

 

(c)           Drawings
and Reimbursements; Funding of Participations.

 

(i)            Upon receipt
from the beneficiary of any Letter of Credit of any drawing under such Letter
of Credit (or any notice thereof), L/C Issuer shall notify Borrower and
Administrative Agent thereof.  If
L/C Issuer shall make any payment in respect of a Letter of Credit,
Borrower shall reimburse L/C Issuer the amount of such payment not later than
1:00 p.m. on the related Honor Date if Borrower shall have received notice
of such payment prior to 11:00 a.m. on the Honor Date, or, if such notice
has not been received by Borrower prior to such time on such Honor Date, then
not later than 10:00 a.m. on the Business Day immediately following the day
that Borrower receives such notice.  If
Borrower fails to so reimburse L/C Issuer, then Administrative Agent shall
promptly notify each Working Capital Lender of the related Honor Date, the
Unreimbursed Amount and the amount of such Lender’s Working Capital Percentage
Share of such Unreimbursed Amount.  In
such event, Borrower shall be deemed to have requested a Working Capital
Borrowing consisting of Base Rate Loans to be disbursed on such Honor Date in
an amount equal to such Unreimbursed Amount, without regard to the minimum and
multiples specified in Section 2.02
for the principal amount of Base Rate Loans, but subject to the amount of the
unutilized portion of the Aggregate Working Capital Commitments and the
conditions set forth in Section 4.02
(other than the delivery of a Loan Notice). 
Any notice given by L/C Issuer or Administrative Agent pursuant to
this Section 2.03(c)(i) may be
given by telephone if immediately confirmed in writing; provided
that the lack of such an immediate confirmation shall not affect the
conclusiveness or binding effect of such notice.

 

(ii)           Each Working
Capital Lender shall, upon any notice pursuant to Section 2.03(c)(i),
make funds available to Administrative Agent for the account of L/C Issuer
at the Administrative Agent’s Office in an amount equal to such Lender’s
Working Capital Percentage Share multiplied by
the Unreimbursed Amount not later than 1:00 p.m. on the Business Day
specified in such notice by Administrative Agent, whereupon, subject to the
provisions of Section 2.03(c)(iii), each
Working Capital Lender that so makes funds available shall be deemed to have
made a Working Capital Loan that is a Base Rate Loan to Borrower in such amount
on the Honor Date.  Administrative Agent
shall remit the funds so received to L/C Issuer.

 

(iii)          With respect to
any Unreimbursed Amount that is not fully refinanced by a Working Capital
Borrowing consisting of Base Rate Loans because the conditions set forth in Section 4.02 cannot be satisfied or for any other
reason, Borrower shall be deemed to have incurred from L/C Issuer an
L/C Borrowing on the Honor Date in the amount of the 

 

41

 

Unreimbursed
Amount that is not so refinanced, which L/C Borrowing shall be due and
payable on demand (together with interest) and shall bear interest at the
Default Rate.  In such event, each
Working Capital Lender’s payment to Administrative Agent for the account of
L/C Issuer pursuant to Section 2.03(c)(ii) shall
be deemed payment in respect of its participation in such L/C Borrowing
and shall constitute an L/C Advance from such Lender in satisfaction of
its participation obligation under this Section 2.03.

 

(iv)          Until each
Working Capital Lender funds its Working Capital Loan or L/C Advance
pursuant to this Section 2.03(c) to
reimburse L/C Issuer for any amount drawn under any Letter of Credit,
interest in respect of the amount of such Lender’s Working Capital Percentage
Share of such amount shall be solely for the account of L/C Issuer.

 

(v)           Each Working
Capital Lender’s obligation to make Working Capital Loans or L/C Advances
to reimburse L/C Issuer for amounts drawn under Letters of Credit, as
contemplated by this Section 2.03(c),
shall be absolute and unconditional and shall not be affected by any circumstance,
including:  (A) any setoff,
counterclaim, recoupment, defense or other right that such Lender may have
against L/C Issuer, Borrower or any other Person for any reason
whatsoever; (B) the occurrence or continuance of a Default; or
(C) any other occurrence, event or condition, whether or not similar to
any of the foregoing; provided that
each Working Capital Lender’s obligation to make Working Capital Loans pursuant
to this Section 2.03(c) is subject to
the conditions set forth in Section 4.02
(other than delivery by Borrower of a Loan Notice).  No such making of an L/C Advance shall
relieve or otherwise impair the obligation of Borrower to reimburse
L/C Issuer for the amount of any payment made by L/C Issuer under any
Letter of Credit, together with interest as provided herein.

 

(vi)          If any Working
Capital Lender fails to make available to Administrative Agent for the account
of L/C Issuer any amount required to be paid by such Lender pursuant to
the foregoing provisions of this Section 2.03(c) by
the time specified in Section 2.03(c)(ii),
L/C Issuer shall be entitled to recover from such Lender (acting through
Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment
is immediately available to L/C Issuer at a rate per annum equal to the
greater of the Federal Funds Rate and a rate determined by L/C Issuer in
accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees
customarily charged by L/C Issuer in connection with the foregoing.  A certificate of L/C Issuer submitted to
any Working Capital Lender (through Administrative Agent) with respect to any
amounts owing under this clause (vi) shall be conclusive absent manifest
error.

 

(d)           Repayment
of Participations.

 

(i)            If, at any time
after L/C Issuer has made a payment under any Letter of Credit and has
received from any Working Capital Lender such Lender’s L/C Advance in
respect of such payment in accordance with Section 2.03(c),
Administrative Agent receives for the account of L/C Issuer any payment in
respect of the related Unreimbursed Amount or interest thereon (whether
directly from Borrower or otherwise, including proceeds of Cash Collateral
applied thereto by Administrative Agent), Administrative Agent will distribute
to such Lender an amount 

 

42

 

that
equals its Working Capital Percentage Share thereof (appropriately adjusted, in
the case of interest payments, to reflect the period of time during which such
Lender’s L/C Advance was outstanding) in the same funds as those received
by Administrative Agent.

 

(ii)           If any payment
received by Administrative Agent for the account of L/C Issuer pursuant to
Section 2.03(c)(i) is
required to be returned under any of the circumstances described in Section 10.05 (including pursuant to any settlement
entered into by L/C Issuer in its discretion), each Working Capital Lender
shall pay to Administrative Agent for the account of L/C Issuer an amount
equal to its Working Capital Percentage Share thereof on the demand of
Administrative Agent, plus interest
thereon from the date of such demand to the date such amount is returned by
such Lender, at a rate per annum equal to the Federal Funds Rate from time to
time in effect.  The obligations of
Working Capital Lenders under this clause shall survive the payment in full of
the Obligations and the termination of this Agreement.

 

(e)           Obligations
Absolute.  The obligation
of Borrower to reimburse L/C Issuer for each drawing under each Letter of
Credit and to repay each L/C Borrowing are absolute, unconditional and
irrevocable and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances, including the following:

 

(i)            any lack of
validity or enforceability of such Letter of Credit, this Agreement, or any
other Loan Document;

 

(ii)           the existence
of any claim, counterclaim, setoff, defense or other right that Borrower or any
other Loan Party may have at any time against any beneficiary or any transferee
of such Letter of Credit (or any Person for whom any such beneficiary or any
such transferee may be acting), L/C Issuer or any other Person, whether in
connection with this Agreement, the transactions contemplated hereby or by such
Letter of Credit or any agreement or instrument relating thereto, or any
unrelated transaction;

 

(iii)          any draft,
demand, certificate or other document presented under such Letter of Credit
proving to be forged, fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect; or any loss or
delay in the transmission or otherwise of any document required in order to
make a drawing under such Letter of Credit;

 

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

 

(v)           any other
circumstance or happening whatsoever, whether or not similar to any of the
foregoing, including any other circumstance that might otherwise constitute a
defense available to, or a discharge of, Borrower or any other Loan Party.

 

43

 

Borrower
shall promptly examine a copy of each Letter of Credit and each amendment
thereto that is delivered to it and, in the event of any claim of noncompliance
with Borrower’s instructions or other irregularity, Borrower will immediately
notify L/C Issuer in writing. 
Borrower shall be conclusively deemed to have waived any such claim
against L/C Issuer and its correspondents unless such notice is given as
aforesaid.

 

(f)            Role of
L/C Issuer.  Each Working
Capital Lender and Borrower agree that, in paying any drawing under a Letter of
Credit, L/C Issuer shall not have any responsibility to obtain any
document (other than any sight draft, certificates and documents expressly
required by the Letter of Credit) or to ascertain or inquire as to the validity
or accuracy of any such document or the authority of the Person executing or
delivering any such document.  None of
L/C Issuer, Administrative Agent, any of their respective Related Parties
and any correspondent, participant or assignee of L/C Issuer shall be
liable to any Lender for:  (i) any
action taken or not taken, at the request or with the approval of Lenders or Required
Lenders, as applicable, in connection with a Letter of Credit or any Issuer
Document; (ii) in the absence of gross negligence or willful misconduct,
any action taken or not taken in connection with a Letter of Credit or any
Issuer Document; or (iii) the due execution, effectiveness, validity or enforceability
of any document related to any Letter of Credit or Issuer Document.  As between Borrower and L/C Issuer,
Borrower hereby assumes all risks of the acts or omissions of any beneficiary
or transferee with respect to its use of any Letter of Credit; provided that this assumption is not intended to, and shall
not, preclude Borrower from pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement.  None of L/C Issuer, Administrative Agent,
any of their respective Related Parties and any correspondent, participant or
assignee of L/C Issuer shall be liable or responsible for any of the
matters described in clauses (i) through (v) of Section 2.03(e);
provided that, notwithstanding anything
to the contrary contained in such clauses, Borrower may have a claim against
L/C Issuer, and L/C Issuer may be liable to Borrower, to the extent,
but only to the extent, of any direct, as opposed to consequential or
exemplary, damages suffered by Borrower that Borrower proves were caused by
L/C Issuer’s willful misconduct or gross negligence or L/C Issuer’s
willful failure to pay under any Letter of Credit after the presentation to it
by the beneficiary of a sight draft and certificate(s) strictly complying
with the terms and conditions of a Letter of Credit.  In furtherance and not in limitation of the
foregoing, L/C Issuer may accept documents that appear on their face to be
in order, without responsibility for further investigation, regardless of any
notice or information to the contrary, and L/C Issuer shall not be
responsible for the validity or sufficiency of any document transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, that may prove
to be invalid or ineffective for any reason.

 

(g)           Cash
Collateral.  Upon the
request of Administrative Agent, if L/C Issuer has honored any full or
partial drawing request under any Letter of Credit and such drawing has
resulted in an L/C Borrowing that remains outstanding after payment
thereof is due from Borrower, or if, on or after the L/C Expiration Date,
any L/C Obligation remains outstanding for any reason without the consent
of all Lenders, then Borrower shall, in each such case, immediately Cash
Collateralize the then Outstanding Amount of all L/C Obligations with an
amount equal to 102.00% of such Outstanding Amount.  Section 2.05
and Section 8.02(c) set forth
certain additional requirements to deliver Cash Collateral hereunder.  Borrower hereby grants to Administrative
Agent, for the benefit of L/C Issuer and Working Capital Lenders, a
security interest in all such cash, deposit accounts and all balances therein
and all proceeds of the foregoing.

 

44

 

(h)           Applicability
of ISP.  Unless otherwise expressly
agreed by L/C Issuer and Borrower when a standby Letter of Credit is
issued (including any such agreement applicable to an Existing Letter of
Credit), the rules of the ISP shall apply to such Letter of Credit.

 

(i)            L/C Fees.  Borrower shall pay to Administrative Agent
for the account of each Working Capital Lender in accordance with its Working
Capital Percentage Share a fee (the “L/C Fee”)
equal to the Applicable Rate multiplied by
the actual daily amount available to be drawn under all Letters of Credit.  For purposes of computing the actual daily
amount available to be drawn under all Letters of Credit, the amount of each
Letter of Credit shall be determined in accordance with Section 1.02(i).  L/C Fees shall be:  (i) computed on a quarterly basis in
arrears and (ii) due and payable on the last Business Day of each March,
June, September and December (in each case for the calendar quarter
then ending), commencing with the first such date to occur after the issuance
of such Letter of Credit, on the L/C Expiration Date and thereafter on
demand.  If there is any change in the
Applicable Rate during any quarter, then the actual daily amount available to
be drawn under all Letters of Credit shall be computed and multiplied
by the Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect. 
Notwithstanding anything to the contrary contained herein, while any
Event of Default exists, upon written notice to Borrower from Required Working
Capital Lenders, all L/C Fees shall accrue at the Default Rate.

 

(j)            Fees of
L/C Issuer.  Borrower
shall pay directly to L/C Issuer for its own account such fees with
respect to each Letter of Credit as are set forth in the Fee Letter and any
other customary fees.

 

(k)           Conflict
with Issuer Documents.  If a
conflict exists between the terms hereof and the terms of any Issuer Document,
the terms hereof shall control.

 

SECTION 2.04                               SWING
LINE LOANS.

 

(a)           The
Swing Line.  Subject to
the terms and conditions set forth herein, Swing Line Lender agrees, in
reliance upon the agreements of the Floorplan Lenders set forth in this Section 2.04, to make loans (each such loan, a “Swing Line Loan”) to Borrower from
time to time on any Business Day from the Closing Date through the tenth (10th) Business Day immediately
preceding the last day of the Floorplan Availability Period in an aggregate
amount not to exceed at any time outstanding the amount of the Swing Line
Sublimit, notwithstanding the fact that such Swing Line Loans, when aggregated
with the Floorplan Percentage Share of the Outstanding Amount of Floorplan
Loans acting as Swing Line Lender, may exceed the amount of such Lender’s
Floorplan Commitment; provided that,
after giving effect to any Swing Line Loan: 
(i) the Total Floorplan Outstandings shall not exceed Floorplan
Availability; and (ii) the aggregate Outstanding Amount of the Floorplan
Loans of any Floorplan Lender (other than the Swing Line Lender in such
capacity), plus such other Lender’s Floorplan
Percentage Share of the Outstanding Amount of all Swing Line Loans shall not
exceed such Lender’s Floorplan Commitment. 
Each Swing Line Loan shall be a Base Rate Loan.  Immediately upon the making of a Swing Line
Loan, each Floorplan Lender shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from Swing Line Lender a risk participation
in such Swing Line Loan in an amount equal to the such Lender’s Floorplan
Percentage Share multiplied by the amount of such
Swing Line Loan.  Notwithstanding the
foregoing, (i) the Swing Line Lender shall not be obligated to make a
Swing Line Loan to refinance an outstanding Swing Line Loan, and (ii) the
Swing Line Lender shall not be

 

45

 

required
to make a Swing Line Loan if (A) prior
thereto or simultaneously therewith the Borrower shall not have borrowed
Floorplan Loans or (B) any Floorplan
Lender shall be a Defaulting Lender.

 

(b)           Swing
Line Borrowing Procedures.  Unless the Swing Line has been terminated or
suspended by Swing Line Lender as provided in subsection (a) of this Section 2.04, each Swing Line Borrowing shall be made
upon Borrower’s irrevocable notice to Swing Line Lender and Administrative
Agent, which may be given by telephone. 
Each such notice must be received by Swing Line Lender and
Administrative Agent not later than 1:00 p.m. on the requested borrowing
date, and must specify:  (i) the
amount to be borrowed, which shall be a minimum of $100,000.00 or a whole
multiple of $50,000.00 in excess thereof; (ii) the requested borrowing
date, which must be a Business Day.  Each
such telephonic notice must be confirmed promptly by delivery to Swing Line
Lender and Administrative Agent of a written Swing Line Loan Notice, appropriately
completed and signed by a Responsible Officer of Borrower.  Promptly after receipt by Swing Line Lender
of any telephonic Swing Line Loan Notice, Swing Line Lender will confirm with
Administrative Agent (by telephone or in writing) that Administrative Agent has
also received such Swing Line Loan Notice and, if not, Swing Line Lender will
notify Administrative Agent (by telephone or in writing) of the contents
thereof.  Unless (A) the Swing Line
has been terminated or suspended by Swing Line Lender, or (B) Swing Line
Lender has received notice (by telephone or in writing) from Administrative
Agent (including at the request of any Floorplan Lender) prior to 2:00 p.m.
on the date of the proposed Swing Line Borrowing (1) directing Swing Line
Lender not to make such Swing Line Loan as a result of the limitations set
forth in the proviso to the first sentence of Section 2.04(a),
or (2) that at least one of the applicable conditions specified in Article IV is not then satisfied, then, subject to the
terms and conditions hereof, Swing Line Lender will, not later than 3:00 p.m.
on the borrowing date specified in the related Swing Line Loan Notice, make the
amount of its Swing Line Loan available to Borrower at its office by crediting
the account of Borrower on the books of Swing Line Lender in immediately
available funds.  Floorplan Lenders agree
that Swing Line Lender may agree to modify the borrowing procedures used in
connection with the Swing Line in its discretion and without affecting any of
the obligations of Floorplan Lenders hereunder other than notifying
Administrative Agent of a Swing Line Loan Notice.

 

(c)           Refinancing
of Swing Line Loans.

 

(i)            Swing Line
Lender at any time in its sole and absolute discretion may request, on the 15th day of each month (or, if such day is not a
Business Day, the immediately preceding Business Day) and on the last Business
Day of each month during the term hereof shall request, on behalf of Borrower
(which hereby irrevocably authorizes Swing Line Lender to so request on its
behalf), that each Floorplan Lender make a Floorplan Loan that is a Base Rate
Loan in an amount equal to such Lender’s Floorplan Percentage Share multiplied by the aggregate Outstanding Amount of Swing Line
Loans as of the close of business on the immediately preceding Friday (or, if
such day is not a Business Day, the immediately preceding Business Day).  Such request shall be made in writing (which
written request shall be deemed to be a Loan Notice for purposes hereof) and in
accordance with the requirements of Section 2.02,
without regard to the minimum and multiples specified therein for the principal
amount of Base Rate Loans, but subject to the unutilized portion of the
Aggregate Floorplan Commitments and the conditions set forth in Section 4.02.  Swing
Line Lender shall furnish Borrower with a copy of the applicable Loan Notice
promptly after delivering such notice to Administrative Agent.  Each Floorplan Lender shall make an amount
equal to its Floorplan Percentage Share multiplied by
the 

 

46

 

aggregate
amount of the requested Floorplan Loans specified in such Loan Notice available
to Administrative Agent in immediately available funds for the account of Swing
Line Lender at the Administrative Agent’s Office not later than 1:00 p.m.
on the day specified in such Loan Notice, whereupon, subject to Section 2.04(c)(ii), each Floorplan Lender that so
makes funds available shall be deemed to have made a Floorplan Loan that is a
Base Rate Loan to Borrower in such amount. 
Administrative Agent shall promptly remit the funds so received to Swing
Line Lender.

 

(ii)           If for any
reason the outstanding amount of all Swing Line Loans cannot be refinanced by
such a Floorplan Borrowing in accordance with Section 2.04(c)(i),
then the request for Floorplan Loans that are Base Rate Loans submitted by
Swing Line Lender as set forth herein shall be deemed to be a request by Swing
Line Lender that each Floorplan Lender fund its risk participation in the
relevant Swing Line Loan and each Floorplan Lender’s payment to Administrative
Agent for the account of Swing Line Lender pursuant to Section 2.04(c)(i) shall
be deemed payment in respect of such participation.

 

(iii)          If any
Floorplan Lender fails to make available to Administrative Agent for the
account of Swing Line Lender any amount required to be paid by such Lender
pursuant to the foregoing provisions of this Section 2.04(c) by
the time specified in Section 2.04(c)(i),
Swing Line Lender shall be entitled to recover from such Lender (acting through
Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment
is immediately available to Swing Line Lender at a rate per annum equal to the
greater of the Federal Funds Rate and a rate determined by Swing Line Lender in
accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees
customarily charged by Swing Line Lender in connection with the foregoing.  A certificate of Swing Line Lender submitted
to any Floorplan Lender (through Administrative Agent) with respect to any
amounts owing under this clause (iii) shall be conclusive absent
manifest error.

 

(iv)          Each Floorplan
Lender’s obligation to make Floorplan Loans or to purchase and fund risk
participations in Swing Line Loans pursuant to this Section 2.04(c) shall
be absolute and unconditional and shall not be affected by any circumstance,
including:  (A) any setoff,
counterclaim, recoupment, defense or other right that such Lender may have
against Swing Line Lender, Borrower or any other Person for any reason
whatsoever; (B) the occurrence or continuance of a Default; or
(C) any other occurrence, event or condition, whether or not similar to
any of the foregoing; provided that
each Floorplan Lender’s obligation to make Floorplan Loans pursuant to this Section 2.04(c) is subject to the conditions set
forth in Section 4.02.  No such funding of risk participations shall
relieve or otherwise impair the obligation of Borrower to repay Swing Line
Loans together with interest as provided herein.

 

(d)           Repayment
of Participations.

 

(i)            If, at any time
after any Floorplan Lender has purchased and funded a risk participation in a
Swing Line Loan, Swing Line Lender receives any payment on account of such
Swing Line Loan, then Swing Line Lender will distribute to such Lender an
amount equal to its Floorplan Percentage Share multiplied
by such payment (appropriately adjusted, in the case of 

 

47

 

interest
payments, to reflect the period of time during which such Lender’s risk
participation was funded) in the same funds as those received by Swing Line
Lender.

 

(ii)           If any payment
received by Swing Line Lender in respect of principal or interest on any Swing
Line Loan is required to be returned by Swing Line Lender under any of the
circumstances described in Section 10.05
(including pursuant to any settlement entered into by Swing Line Lender in its
discretion), each Floorplan Lender shall pay to Swing Line Lender an amount
equal to its Floorplan Percentage Share multiplied by
the amount to be returned on demand of Administrative Agent, plus interest thereon from the date of such demand to the
date such amount is returned, at a rate per annum equal to the Federal Funds
Rate.  Administrative Agent will make
such demand upon the request of Swing Line Lender.  The obligations of Floorplan Lenders under
this clause shall survive the payment in full of the Obligations and the
termination of this Agreement.

 

(e)           Interest
for Account of Swing Line Lender.  Swing Line Lender shall be responsible for
invoicing Borrower for interest on Swing Line Loans.  Until each Floorplan Lender funds its
Floorplan Loan that is a Base Rate Loan or risk participation pursuant to this Section 2.04 to refinance such Lender’s Floorplan
Percentage Share of any Swing Line Loan, interest in respect of such
proportionate share shall be solely for the account of Swing Line Lender.

 

(f)            Payments
Directly to Swing Line Lender.  Borrower shall make all payments of principal
and interest in respect of Swing Line Loans directly to Swing Line Lender.

 

(g)           Treasury
Management Borrowings and Payments.  Unless the Swing Line has been terminated or
suspended by Swing Line Lender as provided in subsection (a) of this Section 2.04 and so long as the Treasury Management
Service Documents are effective between Swing Line Lender and Borrower, Swing
Line Borrowings may be made and repaid by Borrower pursuant to the Treasury
Management Service Documents.  Swing Line
Lender shall have no obligation to make a Swing Line Loan pursuant to the
Treasury Management Service Documents if (A) the Swing Line has been
terminated or suspended by Swing Line Lender as provided in this Agreement, or
(B) Swing Line Loans are not available (1) as a result of the
limitations set forth in the proviso to the first sentence of Section 2.04(a), or (2) because at least one of
the applicable conditions specified in Article IV
is not then satisfied.  Revolving Credit
Lenders agree that Swing Line Lender may agree to modify the Treasury
Management Service Documents and the borrowing procedures set forth therein
used in connection with the Swing Line in its discretion and without affecting any
of the obligations of Revolving Credit Lenders hereunder.

 

48

 

SECTION 2.05          PAYMENTS AND PREPAYMENTS.

 

(a)           Swing
Line Repayments.  The Borrower
shall repay each Swing Line Loan on the earlier to occur of (i) the date
five (5) Business Days after such Swing Line Loan is made or (ii) the
Floorplan Maturity Date.

 

(b)           Voluntary
Prepayments.

 

(i)            Borrower may,
upon notice to Administrative Agent, at any time or from time to time
voluntarily prepay Working Capital Loans in whole or in part without premium or
penalty; provided that:  (A) such notice must be received by
Administrative Agent not later than 11:00 a.m.:  (1) three Business Days prior to any
date of prepayment of Working Capital Loans that are Eurodollar Rate Loans; and
(2) one Business Day prior to the date of prepayment of Working Capital
Loans that are Base Rate Loans; and (B) any prepayment of any Working
Capital Loans of a given Type shall be in a principal amount of $1,000,000.00
or a whole multiple of $500,000.00 in excess thereof for Eurodollar Rate Loans
and $500,000.00 or a whole multiple of $100,000.00 in excess thereof for Base
Rate Loans, or, if less, the entire principal amount thereof then
outstanding.  Each such notice shall
specify the date and amount of such prepayment and the Type(s) of Working
Capital Loans to be prepaid. 
Administrative Agent will promptly notify each Working Capital Lender of
its receipt of each such notice and of the amount of such Lender’s Working
Capital Percentage Share thereof.  If
Borrower gives such notice, then Borrower’s prepayment obligation shall be
irrevocable, and Borrower shall make such prepayment and the payment amount
specified in such notice shall be due and payable on the date specified
therein.  Any prepayment of a Working
Capital Loan that is a Eurodollar Rate Loan shall be accompanied by all accrued
interest on the amount prepaid, together with any additional amounts required
pursuant to Section 3.05.  Each such prepayment shall be applied to the
Working Capital Loans of the Working Capital Lenders in accordance with their
respective Working Capital Percentage Shares.

 

(ii)           Borrower may,
upon notice to Swing Line Lender (with a copy to Administrative Agent), at any
time or from time to time, voluntarily prepay Swing Line Loans in whole or in
part without premium or penalty; provided
that:  (A) such notice must be
received by Swing Line Lender and Administrative Agent not later than 1:00 p.m.
on the date of the prepayment; and (B) any such prepayment shall be in a
minimum principal amount of $100,000.00 or a whole multiple of $50,000.00 in
excess thereof or, if the aggregate Outstanding Amount of Swing Line Loans is
less, the entire Outstanding Amount thereof. 
Each such notice shall specify the date and amount of such
prepayment.  If Borrower gives such a
notice, then Borrower’s prepayment obligation shall be irrevocable, and
Borrower shall make such prepayment and the payment amount specified in such
notice shall be due and payable on the date specified therein.

 

(iii)          Borrower may,
upon notice to Administrative Agent, at any time or from time to time
voluntarily prepay Floorplan Loans in whole or in part without premium or
penalty; provided that:  (A) such notice must be received by
Administrative Agent not later than 11:00 a.m. one Business Day prior to
the date of prepayment of Floorplan Loans; and (B) any prepayment of any
Floorplan Loans shall be in a principal amount of $500,000.00 or a whole
multiple of $100,000.00 in excess thereof, or, if less, the entire principal
amount thereof then 

 

49

 

outstanding.  Each such notice shall specify the date and
amount of such prepayment. 
Administrative Agent will promptly notify each Floorplan Lender of its receipt
of each such notice and of the amount of such Lender’s Floorplan Percentage
Share thereof.  If Borrower gives such
notice, then Borrower’s prepayment obligation shall be irrevocable, and
Borrower shall make such prepayment and the payment amount specified in such
notice shall be due and payable on the date specified therein.  Each such prepayment shall be applied to the
Floorplan Loans of the Floorplan Lenders in accordance with their respective
Floorplan Percentage Shares.

 

(c)           Mandatory
Prepayments.

 

(i)            Upon any
(A) Event of Loss, or (B) Disposition or series of Dispositions by
Borrower or any Subsidiary thereof undertaken within any fiscal year other than
Dispositions permitted under Section 7.05,
Borrower shall prepay the Loans in an amount equal to 100.00% of the Net
Proceeds of each such Event of Loss or each such Disposition; in each case, to
the extent that the Net Proceeds generated by such Event of Loss or Disposition(s) exceed
$5,000,000 in the aggregate for all such Events of Loss or Dispositions, as the
case may be, in any fiscal year; provided that
no such prepayment shall be required if the Administrative Agent provides
written consent for the Borrower or any Subsidiary thereof to purchase
replacement property or restore the property affected by such Event of Loss.

 

(ii)           Upon receipt by
Borrower or any Subsidiary thereof, Borrower shall prepay the Loans in an
amount equal to 100.00% of the proceeds (net of underwriting discounts and
commissions or placement fees, investment banking fees, legal fees, accounting
fees, and other customary fees, commissions, expenses and costs associated
therewith) of any incurrence of Debt, other than Permitted Debt by Borrower or
any Subsidiary thereof.  Any prepayment
pursuant to this Section 2.05(c)(ii) shall
not be subject to the minimum amount provisions of Section 2.05(b).

 

(iii)          Intentionally
Omitted.

 

(iv)          If, on any date
and for any reason, the Outstanding Amount of L/C Obligations exceeds the
L/C Sublimit, then Borrower shall Cash Collateralize on such date
L/C Obligations in an amount equal to such excess.

 

(v)           Intentionally
Omitted.

 

(vi)          Subject to Article IV, if on any date the Total Working Capital
Outstandings minus the amount of any
L/C Obligations Cash Collateralized on such date pursuant to the preceding
clause (iv), exceeds Working Capital Availability, then Borrower shall
immediately, and without notice or demand, prepay the outstanding principal
amount of the Working Capital Loans, Swing Line Loans and L/C Borrowings
by an amount equal to the applicable excess. 
Any such prepayment shall be applied, first,
to any L/C Borrowings and/or Cash Collateralize L/C Obligations, second, to any Working Capital Loans constituting Base Rate
Loans or matured Eurodollar Rate Loans, as selected by Borrower, and, third, at Borrower’s option, to Cash Collateralize
Eurodollar Rate Loans (which Cash Collateral shall be applied on the maturity
date of their respective Interest Periods in the order of the maturities of
their respective Interest 

 

50

 

Periods)
or to prepay Eurodollar Rate Loans (in the order of the maturity of their
respective Interest Periods).

 

(vii)         Subject to Article IV, if on any date the Total Floorplan
Outstandings exceeds Floorplan Availability, then Borrower shall immediately,
and without notice or demand, prepay the outstanding principal amount of the
Floorplan Loans and Swing Line Loans by an amount equal to the applicable
excess.  Any such prepayment shall be
applied, first, to prepay Swing Line Loans, second, to any Floorplan Loans constituting Base Rate Loans
or matured Eurodollar Rate Loans, as selected by Borrower, and, third, at Borrower’s option, to Cash Collateralize
Eurodollar Rate Loans (which Cash Collateral shall be applied on the maturity
date of their respective Interest Periods in the order of the maturities of
their respective Interest Periods) or to prepay Eurodollar Rate Loans (in the
order of the maturity of their respective Interest Periods).

 

(viii)        If, following
any reduction of the Aggregate Commitments pursuant to Section 2.06, the aggregate Outstanding Amount of Swing Line Loans
would exceed the Swing Line Sublimit (including as reduced by such reduction),
Borrower shall prepay on the reduction date the Outstanding Amount of Swing
Line Loans by an amount equal to the amount by which such Outstanding Amount
exceeds the Swing Line Sublimit.

 

(ix)           If, following
any reduction of the Aggregate Commitments pursuant to Section 2.06, the L/C Obligations would exceed the L/C Sublimit
(including as reduced by such reduction), Borrower shall Cash Collateralize
such L/C Obligations.

 

(d)           Intentionally
Omitted.

 

SECTION 2.06          TERMINATION OR REDUCTION OF
AGGREGATE COMMITMENTS.

 

(a)           Voluntary
Reductions; Termination.

 

(i)            Borrower may, upon
notice to Administrative Agent, terminate the Aggregate Working Capital
Commitments, or from time to time permanently reduce the Aggregate Working
Capital Commitments; provided
that:  (A) any such notice shall be
irrevocable and received by Administrative Agent not later than 11:00 a.m.
three Business Days prior to the date of termination or reduction; (B) any
such partial reduction shall be in an aggregate amount of $1,000,000.00 or any
whole multiple of $1,000,000.00 in excess thereof; (C) Borrower shall not
terminate or reduce the Aggregate Working Capital Commitments if, after giving
effect thereto and to any concurrent prepayments hereunder, the Total Working
Capital Outstandings would exceed the Aggregate Working Capital Commitments;
and (D) if, after giving effect to any reduction of the Aggregate Working
Capital Commitments, the sum of the L/C Sublimit exceeds the amount of the
Aggregate Working Capital Commitments, such sublimit(s) shall be
automatically reduced by the amount of such excess.  Administrative Agent will promptly notify
Lenders of any such notice of termination or reduction of the Aggregate Working
Capital Commitments.  Any reduction of
the Aggregate Working Capital Commitments shall be applied to the commitment of
each Working Capital Lender according to its Working Capital Percentage Share
thereof.  All fees payable under Sections 2.03(i) and (j) and
2.09 accrued until the

 

51

 

effective
date of any termination of the Aggregate Working Capital Commitments shall be
paid on the effective date of such termination.

 

(ii)           Borrower may,
upon notice to Administrative Agent, terminate the Aggregate Floorplan
Commitments, or from time to time permanently reduce the Aggregate Floorplan
Commitments; provided that:  (A) any such notice shall be irrevocable
and received by Administrative Agent not later than 11:00 a.m. three
Business Days prior to the date of termination or reduction; (B) any such
partial reduction shall be in an aggregate amount of $1,000,000.00 or any whole
multiple of $1,000,000.00 in excess thereof; and (C) Borrower shall not
terminate or reduce the Aggregate Floorplan Commitments if, after giving effect
thereto and to any concurrent prepayments hereunder, the Total Floorplan Outstandings
would exceed the Aggregate Floorplan Commitments; and (D) if, after giving
effect to any reduction of the Aggregate Floorplan Commitments, the sum of the
Swing Line Sublimit exceeds the amount of the Aggregate Floorplan Commitments,
such sublimit(s) shall be automatically reduced by the amount of such
excess.  Administrative Agent will
promptly notify Lenders of any such notice of termination or reduction of the
Aggregate Floorplan Commitments.  Any
reduction of the Aggregate Floorplan Commitments shall be applied to the
commitment of each Floorplan Lender according to its Floorplan Percentage Share
thereof.  All fees payable under Sections 2.03(i) and (j) and
2.09 accrued until the effective date
of any termination of the Aggregate Floorplan Commitments shall be paid on the
effective date of such termination.

 

(b)           Reserved.

 

SECTION 2.07          FINAL REPAYMENT OF LOANS.

 

(a)           Payments
Due on Working Capital Maturity Date.  On the Working Capital Maturity Date,
Borrower shall repay to Working Capital Lenders in full the aggregate
Outstanding Amount of all Working Capital Loans.

 

(b)           Payments
Due on Floorplan Maturity Date.  On the Floorplan Maturity Date, Borrower
shall repay:  (i) to Floorplan
Lenders in full the aggregate Outstanding Amount of all Floorplan Loans; and
(ii) to Swing Line Lender in full the aggregate Outstanding Amount of all
Swing Line Loans.

 

(c)           Intentionally
Omitted.

 

(d)           Intentionally
Omitted.

 

SECTION 2.08          INTEREST; APPLICABLE RATES.

 

(a)           Interest
Generally.  Subject to
the provisions of subsection Section 2.08(b):  (i) each Eurodollar Rate Loan shall bear
interest on the outstanding principal amount thereof for each Interest Period
at a rate per annum equal to the Eurodollar Rate for such Interest Period plus the Applicable Rate; and (ii) each Base Rate Loan
(including a Swing Line Loan) shall bear interest on the outstanding principal
amount thereof from the applicable borrowing date at a rate per annum equal to (A) the
Base 

 

52

 

Rate
or the Daily LIBOR Rate, as designated by Borrower plus
(B) the Applicable Rate for Base Rate Loans.

 

(b)           Default
Rate.

 

(i)            If an Event of
Default occurs because any amount of principal of any Loan is not paid when due
(without regard to any applicable grace periods), whether at stated maturity,
by acceleration or otherwise, such amount shall thereafter bear interest while
such Event of Default exists at a fluctuating interest rate per annum at all
times equal to the Default Rate to the fullest extent permitted by applicable
Laws.

 

(ii)           If an Event of
Default occurs because any amount (other than principal of any Loan) payable by
Borrower under any Loan Document is not paid when due (without regard to any
applicable grace periods), whether at stated maturity, by acceleration or
otherwise, then upon written notice to Borrower from Required Lenders, such
amount shall thereafter bear interest until the related Event of Default no
longer exists at a fluctuating interest rate per annum at all times equal to
the Default Rate to the fullest extent permitted by applicable Laws.

 

(iii)          Upon written
notice to Borrower from Required Lenders, while any Event of Default exists,
Borrower shall pay interest on the principal amount of all outstanding
Obligations hereunder at a fluctuating interest rate per annum at all times
equal to the Default Rate to the fullest extent permitted by applicable Laws
until such Event of Default no longer exists.

 

(iv)          Accrued and
unpaid interest on past due amounts (including interest on past due interest)
shall be due and payable upon demand.

 

(c)           Payment
Dates; Accrual of Interest.  Interest on each Loan shall be due and
payable in arrears on each Interest Payment Date applicable thereto and at such
other times as may be specified herein. 
Interest hereunder shall be due and payable in accordance with the terms
hereof both before and after judgment, and both before and after the
commencement of any proceeding under any Bankruptcy Law.

 

(d)           Increases
and Decreases of Applicable Rates.  Any increase or decrease in any Applicable
Rate resulting from a change in the Consolidated Leverage Ratio shall become
effective as of the date that is the earlier of:  (i) the last date by which Borrower is
otherwise required to deliver a Compliance Certificate in accordance with Section 6.02(b) with reference to Section 6.01 for a given period (each such date, a “calculation date”); and
(ii) the date that is two Business Days after the date on which Borrower
actually delivers a Compliance Certificate in accordance with Section 6.02(b) with reference to Section 6.01 for such period; provided
that the Applicable Rates in effect from the Closing Date to the date that is
two Business Days following receipt by Administrative Agent of a timely
delivered Compliance Certificate with respect to the Fiscal Period ended October 31,
2010 shall be set at Tier III (as indicated on Schedule 1.01-A);
provided further that, if any Compliance
Certificate required to be delivered in accordance with Section 6.02(b) with
reference to Section 6.01 for any given
period is not delivered to Administrative Agent on or before the related
calculation date, then Tier 1 (as indicated on Schedule 1.01-A)
shall apply, effective on the related calculation date until two Business Days
after such Compliance Certificate is actually received by Administrative Agent.

 

53

 

Notwithstanding
the foregoing and for the avoidance of doubt, if, for any period and for any
reason, the actual Consolidated Leverage Ratio is higher than that reported in
the related Compliance Certificate delivered for such period, then Borrower
shall immediately, without the requirement of notice or demand from any Person,
pay to Lending Parties an amount equal to the excess of:  (A) the amount of interest or fees that
would have accrued had the Applicable Rates for such period been based upon the
actual Consolidated Leverage Ratio for such period rather than the Consolidated
Leverage Ratio reported in the Compliance Certificate delivered for such
period; over (B) the amount of interest or
fees that was actually paid by Borrower based upon the Consolidated Leverage
Ratio reported in the Compliance Certificate delivered for such period.

 

SECTION 2.09          FEES.

 

In
addition to certain fees described in subsections (i) and (j) of Section 2.03:

 

(a)           Working
Capital Commitment Fee. 
Borrower shall pay to Administrative Agent for the account of each
Working Capital Lender in accordance with its Working Capital Percentage Share,
a commitment fee (the “Working Capital Commitment
Fee”) equal to the Applicable Rate multiplied
by the actual daily amount by which the
Aggregate Working Capital Commitments exceed the sum of the Total Working
Capital Outstandings.  The Working
Capital Commitment Fee shall accrue at all times during the Working Capital
Availability Period, including at any time during which one or more of the
conditions in Article IV is not met, and
shall be due and payable quarterly in arrears on the last Business Day of each
March, June, September and December, commencing with the first such date
to occur after the Closing Date, and on the Working Capital Maturity Date.  The Working Capital Commitment Fee shall be
calculated quarterly in arrears, and if there is any change in the Applicable
Rate during any quarter, the actual daily amount shall be computed and multiplied by the Applicable Rate separately for each period
during such quarter that such Applicable Rate was in effect.

 

(b)           Administrative
Agent’s Fees.  Borrower
shall pay to Administrative Agent for Administrative Agent’s own account, such
fees as are specified as owing to such Person in the Fee Letter.

 

(c)           Floorplan
Commitment Fee.  Borrower
shall pay to Administrative Agent for the account of each Floorplan Lender in
accordance with its Floorplan Percentage Share, a commitment fee (the “Floorplan Commitment Fee”) equal to
the Applicable Rate multiplied  by the actual daily amount by which the Aggregate Floorplan
Commitments exceed the sum of the Total Floorplan Outstandings (less the Outstanding
Amount of Swing Line Loans).  The
Floorplan Commitment Fee shall accrue at all times during the Floorplan
Availability Period, including at any time during which one or more of the
conditions in Article IV is not met, and
shall be due and payable quarterly in arrears on the last Business Day of each
March, commencing with the first such date to occur after the Closing Date, and
on the Floorplan Maturity Date.  The
Floorplan Commitment Fee shall be calculated quarterly in arrears, and if there
is any change in the Applicable Rate during any quarter, the actual daily
amount shall be computed and multiplied by
the Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect.

 

(d)           Collateral Exam Fees.  The Borrower shall pay the Administrative
Agent fees in connection with any collateral exams, audits or inspections
conducted by or on behalf of the

 

54

 

Administrative
Agent of any Collateral or of the Borrower’s operations or business at the
rates established from time to time by the Administrative Agent, together with
any related out-of-pocket costs and expenses incurred by the Administrative
Agent.

 

SECTION 2.10          COMPUTATIONS OF INTEREST AND
FEES.

 

All
computations of interest for Base Rate Loans shall be made on the basis of a
year of 360 days and actual days elapsed. 
All other computations of interest and fees hereunder shall be made on
the basis of a year of 360 days and actual days elapsed.  Interest shall accrue on each Loan for the
day on which the Loan is made, and shall not accrue on a Loan, or any portion
thereof, for the day on which the Loan or such portion is paid, provided that any Loan that is repaid on the same day on
which it is made shall, subject to Section 2.12(a),
bear interest for one day.  Each
determination by Administrative Agent of an interest rate or fee hereunder
shall be conclusive and binding for all purposes, absent manifest error.

 

SECTION 2.11          EVIDENCE OF DEBT.

 

(a)           Evidence
of Payments.  The Credit
Extensions made by each Lender shall be evidenced by one or more accounts or
records maintained by such Lender and by Administrative Agent in the ordinary
course of business.  The accounts or
records maintained by Administrative Agent and each Lender shall be conclusive
absent manifest error of the amount of the Credit Extensions made by Lenders to
Borrower and the interest and payments thereon. 
Any failure to so record or any error in doing so shall not, however,
limit or otherwise affect the obligation of Borrower hereunder to pay any
amount owing with respect to the Obligations. 
If any conflict exists between the accounts and records maintained by
any Lender and the accounts and records of Administrative Agent in respect of
such matters, the accounts and records of Administrative Agent shall control in
the absence of manifest error.  Upon the
request of any Lender made through Administrative Agent, Borrower shall execute
and deliver to such Lender (through Administrative Agent) a Note, which shall
evidence such Lender’s Loans in addition to such accounts or records.  Each Lender may attach schedules to its Note
and endorse thereon the date, Type (if applicable), amount and maturity of its
Loans and payments with respect thereto.

 

(b)           Evidence
of Certain Participations.  In addition to the accounts and records
referred to in Section 2.11(a), each Lender
and Administrative Agent shall maintain in accordance with its usual practice
accounts or records evidencing the purchases and sales by such Lender of
participations in Letters of Credit and Swing Line Loans.  If any conflict exists between the accounts
and records maintained by Administrative Agent and the accounts and records of
any Lender in respect of such matters, the accounts and records of
Administrative Agent shall control in the absence of manifest error.

 

SECTION 2.12          PAYMENTS GENERALLY; RIGHT OF
ADMINISTRATIVE AGENT TO MAKE DEDUCTIONS AUTOMATICALLY.

 

(a)           Payments
Generally.

 

(i)            All payments to
be made by Borrower shall be made without condition or deduction for any
counterclaim, defense, recoupment or setoff. 
Except as otherwise expressly provided herein, all payments by Borrower
hereunder shall be made to Administrative Agent, for

 

55

 

the
account of the respective Lenders to which such payment is owed, at the
Administrative Agent’s Office in Dollars and in immediately available funds not
later than 12:00 noon on the date specified herein.  Administrative Agent will promptly distribute
to each Lender its applicable Percentage Share (or other applicable share as
provided herein) of such payment in like funds as received by wire transfer to
such Lender’s Lending Office.  All
payments received by Administrative Agent after 12:00 noon shall be deemed
received on the next succeeding Business Day and any applicable interest or fee
shall continue to accrue.  If any payment
to be made by Borrower shall come due on a day other than a Business Day,
payment shall be made on the next following Business Day, and such extension of
time shall be reflected in computing interest or fees, as the case may be.

 

(ii)           Borrower hereby
authorizes Administrative Agent: 
(A) to deduct automatically all principal, interest or fees when
due hereunder or under any Note from any account of Borrower maintained with
Administrative Agent; and (B) if and to the extent any payment of
principal, interest or fees under this Agreement or any Note is not made when
due to deduct any such amount from any or all of the accounts of Borrower
maintained at Administrative Agent. 
Administrative Agent agrees to provide written notice to Borrower of any
automatic deduction made pursuant to this Section 2.12(a)(ii) showing
in reasonable detail the amounts of such deduction.  Each Lender agrees to reimburse Borrower
based on its applicable Percentage Share for any amounts deducted from such
accounts in excess of amount due hereunder and under any other Loan Documents.

 

(b)           Fundings
by Lenders, Payments by Borrower and Presumptions by Administrative Agent.

 

(i)            Unless
Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing that such Lender will not make available to
Administrative Agent such Lender’s share of such Borrowing, Administrative Agent
may assume that such Lender has made such share available on such date in
accordance with Section 2.02 and may, in
reliance upon such assumption, make available to Borrower a corresponding
amount.  In such event, if a Lender has
not in fact made its share of the applicable Borrowing available to
Administrative Agent, then the applicable Lender, on the one hand, and
Borrower, on the other hand, each severally agrees to pay to Administrative
Agent forthwith on demand such corresponding amount in immediately available
funds with interest thereon, for each day from the date such amount is made
available to Borrower to the date of payment to Administrative Agent, at:  (A) in the case of a payment to be made
by such Lender, the greater of the Federal Funds Rate and a rate determined by
Administrative Agent in accordance with banking industry rules on
interbank compensation, plus any administrative, processing or similar fees
customarily charged by Administrative Agent in connection with the foregoing;
and (B) in the case of a payment to be made by Borrower, the interest rate
applicable to Working Capital Loans that are Base Rate Loans.  If Borrower and such Lender shall pay such
interest to Administrative Agent for the same or an overlapping period,
Administrative Agent shall promptly remit to Borrower the amount of such
interest paid by Borrower for such period. 
If such Lender pays its share of the applicable Borrowing to
Administrative Agent, then the amount so paid shall constitute such Lender’s
Loan included in such Borrowing.  Any
payment by Borrower shall be without

 

56

 

prejudice
to any claim Borrower may have against a Lender that shall have failed to make
such payment to Administrative Agent.

 

(ii)           Unless
Administrative Agent shall have received notice from Borrower prior to the date
on which any payment is due hereunder to Administrative Agent for the account
of Lenders or L/C Issuer that Borrower will not make such payment,
Administrative Agent may assume that Borrower has made such payment on such
date in accordance herewith and may, in reliance upon such assumption,
distribute to Lenders or L/C Issuer, as the case may be, the amount
due.  In such event, if Borrower has not
in fact made such payment, then Lenders and L/C Issuer, as the case may
be, each severally agrees to repay to Administrative Agent forthwith on demand
the amount so distributed to such Lenders or L/C Issuer, as the case may
be, in immediately available funds with interest thereon, for each day from the
date such amount is distributed to it to the date of payment to Administrative
Agent, at the greater of the Federal Funds Rate and a rate determined by
Administrative Agent in accordance with banking industry rules on
interbank compensation.  A notice of
Administrative Agent to any Lender or Borrower with respect to any amount owing
under this subsection (b) shall be conclusive, absent manifest error.

 

(c)           Failure
to Satisfy Conditions Precedent.  If any Lender makes available to Administrative
Agent funds for any Loan to be made by such Lender as provided in the foregoing
provisions of this Article II,
and such funds are not made available to Borrower by Administrative Agent
because the conditions to the applicable Credit Extension set forth in Article IV are not satisfied or waived in accordance
with the terms hereof, Administrative Agent shall return such funds (in like
funds as received from such Lender) to such Lender, without interest.

 

(d)           Obligations
of Lenders Several.  The obligations
of Lenders hereunder to make Loans, to fund participations in Letters of Credit
and Swing Line Loans and to make payments under Section 10.04(c) are
several and not joint.  The failure of
any Lender to make any Loan, to fund any such participation or to make any
payment under Section 10.04(c) on any
date required hereunder shall not relieve any other Lender of its corresponding
obligation to do so on such date, and no Lender shall be responsible for the
failure of any other Lender to so make its Loan, purchase its participation or
to make its payment under Section 10.04(c).

 

(e)           Funding
Sources.  Nothing
herein shall be deemed to obligate any Lender to obtain the funds for any Loan
in any particular place or manner or to constitute a representation by any
Lender that it has obtained or will obtain the funds for any Loan in any
particular place or manner.

 

SECTION 2.13          SHARING OF PAYMENTS.

 

If
any Lender shall, by exercising any right of setoff or counterclaim or
otherwise, obtain payment in respect of any principal of or interest on any of
the Loans made by it, or the participations in L/C Obligations or in Swing
Line Loans held by it, resulting in such Lender receiving payment of a
proportion of the aggregate amount of such Loans or participations and accrued
interest thereon greater than its Percentage Share (or other applicable share
as provided herein) thereof as provided herein, then the Lender receiving such
greater proportion shall: 
(a) notify Administrative Agent of such fact; and (b) purchase
(for cash at face value) participations in the Loans and subparticipations in
L/C Obligations

 

57

 

and
Swing Line Loans of the other Lenders, or make such other adjustments as shall
be equitable, so that the benefit of all such payments shall be shared by
Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Loans and other amounts owing them; provided that: 
(i) if any such participations or subparticipations are purchased
and all or any portion of the payment giving rise thereto is recovered, such
participations or subparticipations shall be rescinded and the purchase price
restored to the extent of such recovery, without interest; and (ii) the
provisions of this Section 2.13 shall
not be construed to apply to: 
(A) any payment made by Borrower pursuant to and in accordance with
the express terms of this Agreement; or (B) any payment obtained by a
Lender as consideration for the assignment of or sale of a participation in any
of its Loans or subparticipations in L/C Obligations or Swing Line Loans
to any assignee or participant, other than to Borrower or any Subsidiary
thereof (as to which the provisions of this Section 2.13
shall apply).

 

Each
Loan Party 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
Loan Party rights of setoff and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of such Loan Party in the
amount of such participation.

 

SECTION 2.14          INCREASE IN AGGREGATE
COMMITMENTS.

 

(a)           Increase
in Aggregate Commitments Generally.  So long as no Default has occurred and is
continuing or would result therefrom and the Aggregate Commitments have not
been voluntarily reduced, upon notice to Administrative Agent, at any time
after the Closing Date but prior to the Working Capital Maturity Date, Borrower
may request one or more Additional Working Capital Commitments or one or more
Additional Floorplan Commitments; provided
that:  (i) after giving effect to
any such addition, the maximum aggregate amount of Additional Working Capital
Commitments and Additional Floorplan Commitments that have been added pursuant
to this Section 2.14 shall not exceed $50,000,000; (ii) any such
addition shall be in an aggregate amount of $15,000,000.00 or any whole
multiple of $1,000,000.00 in excess thereof (provided
that such amount may be less than $15,000,000.00 if such amount represents all
remaining availability under the aggregate limit in respect of Additional
Working Capital Commitments and Additional Floorplan Commitments set forth in
clause (i) of this proviso); (iii) Borrower may request a
maximum total of three (3) increases under this section and (iv) no
Lender shall be required to participate in the Additional Working Capital
Commitments or Additional Floorplan Commitments.

 

(b)           Certain
Provisions Regarding Increase of Aggregate Commitments.  If any Additional Working Capital Commitments
or Additional Floorplan Commitments are added in accordance with this Section 2.14, Administrative Agent and Borrower shall
determine the effective date (the “Additional Commitments Effective
Date”) of such addition and the amount of, and the Persons who
will provide, such Additional Working Capital Commitments or Additional
Floorplan Commitments, as applicable; provided that
no existing Lender shall have any obligation to provide all or any portion of
such Additional Working Capital Commitments or Additional Floorplan
Commitments.  Administrative Agent shall
promptly notify Borrower and Lending Parties (which may, in the case of
Additional Working Capital Commitments, include Persons reasonably acceptable
to Administrative Agent and Borrower that were not Lenders prior to the
Additional Commitments Effective Date) of the final amount of such addition and
the Additional Commitments Effective Date, as well as in the case of each
notice to any Working Capital Lender, the respective interests in such Working
Capital Lender’s

 

58

 

Working
Capital Loans, in each case subject to the assignments contemplated by this Section 2.14.  As
conditions precedent to such addition: 
(i) the representations and warranties contained in Article V and the other Loan Documents (including all
documents required pursuant to Section 2.14(c))
shall be true and correct on and as of the Additional Commitments Effective Date,
except to the extent that such representations and warranties specifically
refer to an earlier date, in which case they shall have been true and correct
as of such earlier date, and except that, for purposes of this Section 2.14(b), the representations and warranties
contained in Section 5.11(a) and Section 5.11(b) shall be deemed to refer to the
most recent financial statements furnished pursuant to Section 6.01(a) and
Section 6.01(b), respectively;
(ii) no Default shall exist immediately before or immediately after giving
effect to such addition; without limiting the generality of the foregoing,
Borrower shall be in compliance with the financial covenants set forth in Section 6.12 after giving pro forma effect to the
making of Additional Working Capital Loans or Additional Floorplan Loans, as
applicable, in connection with such addition; (iii) Borrower,
Administrative Agent and Lending Parties (including any new Lending Parties
being added in connection with such addition) shall have entered into all documents
required pursuant to Section 2.14(c),
and Borrower shall have complied with all of the conditions precedent to the
effectiveness of such addition as provided in such documents (including any
requirement to pay fees and expenses to any or all of Administrative Agent,
Arranger and Lending Parties, including any new Lending Parties); and
(iv) Borrower shall have delivered to Administrative Agent a certificate
dated as of the Additional Commitments Effective Date signed by a Responsible
Officer of Borrower, certifying as to the truth, accuracy and correctness of
the matters set forth in the immediately preceding clauses (i) and
(ii).  On each Additional Commitments
Effective Date, each applicable Lender, Eligible Assignee or other Person who
is providing an Additional Working Capital Commitment or an Additional
Floorplan Commitment:  (A) in the
case of any Additional Working Capital Commitment, shall become a “Working Capital Lender” for all
purposes of this Agreement and the other Loan Documents; and (B) in the
case of any Additional Floorplan Commitment, shall become a “Floorplan Lender” for all purposes
of this Agreement and the other Loan Documents. 
Any Additional Working Capital Loan shall be a “Working
Capital Loan” and the other Loan Documents and any Additional
Floorplan Loan shall be a “Floorplan Loan”
for all purposes of this Agreement and the other Loan Documents.  In furtherance of the foregoing, on any
Additional Commitments Effective Date on which Additional Working Capital
Commitments are made, subject to the satisfaction of the other terms and
conditions contained in this Section 2.14:  (1) each of the existing Working Capital
Lenders shall assign to each Person providing an Additional Working Capital
Commitment, and each such Person shall purchase from each of the existing
Working Capital Lenders, in an amount equal to the Outstanding Amount thereof
(together with accrued but unpaid interest thereon), such interests in the
Working Capital Loans outstanding on such date as shall be necessary in order
that, after giving effect to all such assignments and purchases, such Working
Capital Loans will be held by existing Working Capital Lenders and the Person
making the Additional Working Capital Commitments ratably in accordance with
their Working Capital Percentage Shares after giving effect to the addition of
such Additional Working Capital Commitments to the existing Working Capital
Commitments; and (2) each Person making an Additional Working Capital
Commitment shall be deemed for all purposes to have a Working Capital
Commitment and each Additional Working Capital Loan shall be deemed, for all
purposes, a Working Capital Loan.  In
furtherance of the foregoing, on any Additional Commitments Effective Date on
which Additional Floorplan Commitments are made, subject to the satisfaction of
the other terms and conditions contained in this Section 2.14:  (1) each of the existing Floorplan
Lenders shall assign to each Person providing an Additional Floorplan
Commitment, and each such Person shall purchase from each of the existing
Floorplan Lenders, in an amount equal to the Outstanding Amount thereof
(together with accrued but unpaid interest thereon), such interests in the

 

59

 

Floorplan
Loans outstanding on such date as shall be necessary in order that, after
giving effect to all such assignments and purchases, such Floorplan Loans will
be held by existing Floorplan Lenders and the Person making the Additional
Floorplan Commitments ratably in accordance with their Floorplan Percentage
Shares after giving effect to the addition of such Additional Floorplan
Commitments to the existing Floorplan Commitments; and (2) each Person
making an Additional Floorplan Commitment shall be deemed for all purposes to
have a Floorplan Commitment and each Additional Floorplan Loan shall be deemed,
for all purposes, a Floorplan Loan.

 

(c)           Terms
and Documentation.  Any other
terms of and documentation entered into in respect of any Additional Working
Capital Commitments made or any Additional Floorplan Commitments provided in
each case pursuant to this Section 2.14
(collectively, the “Additional Commitment Documentation”)
shall be consistent with the Working Capital Commitments and Floorplan
Commitments (including with respect to voluntary and mandatory
prepayments).  Any Additional Working
Capital Commitments or Additional Floorplan Loans, as applicable, made or
provided pursuant to this Section 2.14
shall be evidenced by one or more entries in the Register maintained by Administrative
Agent in accordance with the provisions set forth in Section 10.06(c).

 

(d)           Conflicts
with Other Provisions.  This Section 2.14 shall supersede any provisions in Section 10.01 to the contrary.  Notwithstanding any other provision of any
Loan Document, the Loan Documents may be amended by Administrative Agent and
the Loan Parties, if necessary, to provide for terms applicable to each
Additional Working Capital Commitment or Additional Floorplan Commitments, as
the case may be.

 

SECTION 2.15          SECURITY FOR THE OBLIGATIONS.

 

Except
as otherwise specifically provided in any Loan Document, all Obligations shall
be secured pursuant to the terms of the Collateral Documents.  All Cash Collateral required to secure the
Obligations (or any portion thereof) shall be maintained in blocked, interest
bearing deposit accounts at Wells Fargo or invested in such other Cash
Equivalents as directed by Borrower and for which Borrower shall have provided
evidence reasonably satisfactory to Administrative Agent that Administrative
Agent possesses a perfected, first priority security interest in such Cash
Collateral.

 

SECTION 2.16          EXTENSION OF MATURITY DATE .

 

(a)           The Borrower may request
that the Floorplan Maturity Date and the Working Capital Maturity Date be
extended for additional terms of twelve (12) months each.  Each of the following conditions must be
satisfied in a manner acceptable to Administrative Agent as a condition
precedent to extension of the Floorplan Maturity Date and the Working Capital
Maturity Date, as applicable:

 

(i)             the Borrower delivers written notice to
Administrative Agent not less than ninety (90) days prior to the Floorplan
Maturity Date and the Working Capital Maturity Date, advising that the Borrower
requests the extension (the “Borrower Extension Notice”);

 

60

 

(ii)            the
Administrative Agent and each Lender has consented in writing to such
extension, which consent may be granted or withheld in the Administrative Agent’s
and/or each Lender’s sole and absolute discretion; and

 

(iii)           the Borrower, Administrative Agent and each Lenders
shall have entered into an amendment to this Agreement which amendment shall
confirm the extension of the Floorplan Maturity Date and the Working Capital
Maturity Date and otherwise be in a form reasonably acceptable to Borrower and
Lender;

 

(iv)          no Default or Event of Default exists (i) as of
the date of the Borrower Extension Notice and (ii) if such extension is
approved by Administrative Agent and each Lender commencement date as of the
effective date of such extension term; and

 

(v)           the Borrower has reimbursed the Administrative Agent
for all costs reasonably incurred by the Administrative Agent in processing the
extension request, including, without limitation, reasonable legal fees and
expenses.

 

(b)           Within 30 days of a Borrower
Extension Notice being posted to the Electronic Platform, the Administrative
Agent and each Lender by its signature hereto, agrees to respond to Borrower in
writing stating its consent and approval or its rejection of the then proposed
extension of the Floorplan Maturity Date and the Working Capital Maturity Date
(“Lender Party Response”).  As to any such extension to which a Lender
consents and approves in a Lender Party Response, such Lender agrees to execute
any amendment to this Agreement evidencing such extension promptly upon the
request of Borrower and Administrative Agent.

 

ARTICLE III

TAXES, YIELD PROTECTION AND ILLEGALITY

 

SECTION 3.01          TAXES.

 

(a)           Payments
Free of Taxes.  Any and all
payments by Borrower to or on account of any obligation of Borrower hereunder
or under any other Loan Document shall be made free and clear of and without
reduction or withholding for any Indemnified Taxes or Other Taxes, provided that, if Borrower shall be required by any
applicable law to deduct any Indemnified Taxes (including any Other Taxes) from
such payments, then:  (i) the sum
payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 3.01), Administrative
Agent, Lender or L/C Issuer, as the case may be, receives an amount equal
to the sum it would have received had no such deductions been made;
(ii) Borrower shall make such deductions; and (iii) Borrower shall
timely pay the full amount deducted to the relevant Governmental Authority in
accordance with applicable law.

 

(b)           Payment
of Other Taxes by Borrower.  Without limiting the provisions of Section 3.01(a), Borrower shall timely pay any Other
Taxes to the relevant Governmental Authority in accordance with applicable law.

 

61

 

(c)           Indemnification
by Borrower.  Borrower
shall indemnify Administrative Agent and each Lending Party, within ten days
after written demand therefor, for the full amount of any Indemnified Taxes or
Other Taxes (including Taxes imposed or asserted on or attributable to amounts
payable under this Section 3.01)
paid by Administrative Agent or such Lending Party, as the case may be, and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such
payment or liability delivered to Borrower by any Lending Party (with a copy to
Administrative Agent), or by Administrative Agent on its own behalf or on
behalf of a Lending Party, shall be conclusive absent manifest error.

 

(d)           Evidence
of Payments.  If requested
in writing by Administrative Agent, Borrower shall deliver to Administrative
Agent, as soon as practicable after any payment of Indemnified Taxes or Other
Taxes by Borrower to a Governmental Authority, 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 Administrative Agent.

 

(e)           Foreign
Lenders.  Each Lending
Party that is not a “United States person” (as such term is defined in
Section 7701(a)(30) of the Code) shall submit to Borrower and
Administrative Agent on or before the date such financial institution becomes a
party hereto, two duly signed completed copies of either IRS Form W-8BEN
or any successor thereto (relating to such Person and entitling it to an
exemption from, or reduction of, withholding tax on all payments to be made to
such Person by Borrower pursuant to this Agreement) or IRS Form W-8ECI or
any successor thereto (relating to all payments to be made to such Person by
Borrower pursuant to this Agreement) or such other evidence satisfactory to
Borrower and Administrative Agent that such Person is entitled to an exemption
from, or reduction of, United States withholding tax.  Thereafter and from time to time, each such
Person shall:  (i) promptly submit
to Administrative Agent and Borrower such additional duly completed and signed
copies of one of such forms (or such successor forms as shall be adopted from time
to time by the relevant United States taxing authorities) as may then be
available under then current United States laws and regulations to avoid, or
such evidence as is satisfactory to Borrower and Administrative Agent of any
available exemption from or reduction of, United States withholding taxes in
respect of all payments to be made to such Person by Borrower or Administrative
Agent pursuant to this Agreement; (ii) promptly notify Administrative
Agent and Borrower of any change in circumstances that would modify or render
invalid any claimed exemption or reduction; and (iii) take such steps as
shall not be materially disadvantageous to it, in the reasonable judgment of
such Person, and as may be reasonably necessary (including the re-designation
of its lending office) to avoid any requirement of applicable Laws that
Borrower or Administrative Agent make any deduction or withholding for taxes
from amounts payable to such Person.  If
such Person fails to deliver the forms referred to in this subsection or other
documentation, then Administrative Agent may withhold from any interest payment
to such Person an amount equivalent to the applicable withholding tax imposed
by Sections 1441 and 1442 of the Code, without reduction.  If any Governmental Authority asserts that
Administrative Agent did not properly withhold any tax or other amount from
payments made in respect of such Person, such Person shall indemnify
Administrative Agent therefor, including all penalties and interest, any taxes
imposed by any jurisdiction on the amounts payable to Administrative Agent
under this Section 3.01, and costs and
expenses (including reasonable attorneys’ fees) of Administrative Agent.  The obligation of Lenders under this Section 3.01 shall survive the termination of the Aggregate
Commitments, repayment of all Obligations and the resignation or replacement of
Administrative Agent.

 

62

 

(f)            Treatment
of Certain Refunds.  If
Administrative Agent or any Lending Party receives a refund of any Taxes or
Other Taxes as to which it has been indemnified by Borrower or with respect to
which Borrower has paid additional amounts pursuant to this Section 3.01, it shall pay to Borrower an amount equal
to such refund (but only to the extent of indemnity payments made, or
additional amounts paid, by Borrower under this Section 3.01
with respect to the Taxes or Other Taxes giving rise to such
refund), net of all out-of-pocket expenses of Administrative Agent or such
Lending Party, as the case may be, and without interest (other than any
interest paid by the relevant Governmental Authority with respect to such
refund); provided that Borrower, upon the request
of Administrative Agent or such Lending Party, as applicable, agrees to repay
the amount paid over to Borrower (plus any
penalties, interest or other charges imposed by the relevant Governmental
Authority) to Administrative Agent or such Lending Party, as applicable, in the
event Administrative Agent or such Lending Party, as applicable is required to
repay such refund to such Governmental Authority.  This subsection (f) shall not be
construed to require Administrative Agent or any Lending Party to make
available its tax returns (or any other information relating to its taxes that
it deems confidential) to Borrower or any other Person.

 

SECTION 3.02          ILLEGALITY.

 

If
any Lender determines that any Law has made it unlawful, or that any
Governmental Authority has asserted that it is unlawful, for any Lender or its
applicable Lending Office to make, maintain or fund Eurodollar Rate Loans, or
to determine or charge interest rates based upon the Eurodollar Rate, or any
Governmental Authority has imposed material restrictions on the authority of
such Lender to purchase or sell, or to take deposits of, Dollars in the London
interbank offered market, then, on notice thereof by such Lender to Borrower
through Administrative Agent, any obligation of such Lender to make or continue
Eurodollar Rate Loans or to convert Working Capital Loans that are Base Rate Loans
to Eurodollar Rate Loans shall be suspended until such Lender notifies
Administrative Agent and Borrower that the circumstances giving rise to such
determination no longer exist.  Upon
receipt of such notice, Borrower shall, upon demand from such Lender (with a
copy to Administrative Agent), prepay or, if applicable, convert all Eurodollar
Rate Loans of such Lender to Base Rate Loans, either on the last day of the
Interest Period therefor, if such Lender may lawfully continue to maintain such
Eurodollar Rate Loans to such day, or immediately, if such Lender may not
lawfully continue to maintain such Eurodollar Rate Loans.  Upon any such prepayment or conversion,
Borrower shall also pay accrued interest on the amount so prepaid or converted
and all amounts due under Section 3.05
in accordance with the terms thereof due to such prepayment or conversion.

 

SECTION 3.03          INABILITY TO DETERMINE RATES.

 

If
(a) Administrative Agent determines in connection with any request for a
Borrowing or continuation of, or a conversion to, Eurodollar Rate Loan that
(i) Dollar deposits are not being offered to banks in the London interbank
offered market for the applicable amount and Interest Period of such Eurodollar
Rate Loan or (ii) adequate and reasonable means do not exist for
determining the Eurodollar Base Rate for any requested Interest Period with
respect to a proposed Eurodollar Rate Loan, or (b) Required Lenders
determine in connection with any request for a Borrowing or continuation of, or
a conversion to, a Eurodollar Rate Loan that the Eurodollar Base Rate for any
requested Interest Period with respect to a proposed Eurodollar Rate Loan does
not adequately and fairly reflect the cost to such Lenders of funding such
Loan, then Administrative Agent will promptly so notify Borrower and each

 

63

 

Lender
in writing.  Thereafter, the obligation
of Lenders to make or maintain Eurodollar Rate Loans shall be suspended until
Administrative Agent (upon the instruction of Required Lenders) revokes such
notice.  Upon receipt of such notice,
Borrower may revoke any pending request for a Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or, failing that, will be deemed to have
converted such request into a request for a Working Capital Borrowing
consisting of Base Rate Loans in the amount specified therein.

 

SECTION 3.04          INCREASED COSTS.

 

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

 

(i)              impose, modify or deem applicable any reserve,
special deposit, compulsory loan, insurance charge or similar requirement
against assets of, deposits with or for the account of, or credit extended or
participated in by, any Lending Party (except any reserve requirement reflected
in the Eurodollar Rate);

 

(ii)             subject any Lending Party to any tax of any kind
whatsoever with respect to this Agreement, any Letter of Credit, any
participation in a Letter of Credit or any Eurodollar Rate Loan made by it, or
change the basis of taxation of payments to such Lending Party in respect
thereof (except for Indemnified Taxes or Other Taxes covered by Section 3.01 and the imposition of, or any change in
the rate of, any Excluded Tax payable by such Lending Party); or

 

(iii)            impose on any Lender or L/C Issuer or the
London interbank offered market any other condition, cost or expense affecting
this Agreement or Eurodollar Rate Loans made by such Lender or any Letter of
Credit or participation therein;

 

and
the result of any of the foregoing shall be to increase the cost to such Lender
of making or maintaining any Eurodollar Rate Loan (or of maintaining its
obligation to make any such Loan), or to increase the cost to such Lender or
L/C Issuer of participating in, issuing or maintaining any Letter of
Credit (or of maintaining its obligation to participate in or to issue any
Letter of Credit), or to reduce the amount of any sum received or receivable by
such Lending Party hereunder (whether of principal, interest or any other
amount), then, upon request of such applicable Lending Party, Borrower will pay
to such Lending Party such additional amount or amounts as will compensate such
Lending Party for such additional costs incurred or reduction suffered.

 

(b)           Capital
Requirements.  If any
Lender or L/C Issuer determines that any Change in Law affecting such
Lender or L/C Issuer or the Lending Office of such Lender or such Lender’s
or L/C Issuer’s holding company, if any, regarding capital requirements
has or would have the effect of reducing the rate of return on such Lender’s or
L/C Issuer’s capital or on the capital of such Lender’s or L/C Issuer’s
holding company, if any, as a consequence of this Agreement, the Commitments of
such Lender or the Loans made by, or participations in Letters of Credit held
by, such Lender, or the Letters of Credit issued by L/C Issuer, to a level
below that which such Lender or L/C Issuer or such Lender’s or
L/C Issuer’s holding company could have achieved but for such Change in
Law (taking into consideration such Lender’s or L/C Issuer’s policies and
the policies of such Lender’s or L/C Issuer’s holding company with respect
to capital adequacy), then from time to time Borrower will pay to such Lender
or L/C Issuer, as the case may be, such additional amount or amounts as
will compensate such

 

64

 

Lender
or L/C Issuer or such Lender’s or L/C Issuer’s holding company for
any such reduction suffered.  It is
acknowledged that this Agreement is being entered into by the Lenders on the
understanding that the Lenders will not be required to maintain capital against
their Working Capital Commitment, the Swing Line Sublimit or the L/C Sublimit,
as applicable, under applicable current Laws and regulatory guidelines.  In the event the Lenders shall be advised by
any Governmental Authority after the date hereof or shall otherwise determine
on the basis of pronouncements of any Governmental Authority after the date
hereof that such understanding is incorrect, it is agreed that the Lenders will
be entitled to make claims under this Section (each such claim to be made
within a reasonable period of time after the Lenders are so advised or have so
determined).

 

(c)           Certificates
for Reimbursement.  A
certificate of a Lender or L/C Issuer setting forth the amount or amounts
necessary to compensate such Lender or L/C Issuer or its holding company,
as the case may be, as specified in subsection (a) or (b) of this Section 3.04, as well as the basis for determining such
amount or amounts, and delivered to Borrower shall be conclusive absent manifest
error.  Borrower shall pay such Lender or
L/C Issuer, as the case may be, the amount shown as due on any such
certificate within ten days after receipt thereof.

 

(d)           Delay
in Requests.  Failure or
delay on the part of any Lender or L/C Issuer to demand compensation
pursuant to the foregoing provisions of this Section 3.04
shall not constitute a waiver of such Lender’s or L/C Issuer’s
right to demand such compensation, provided that
Borrower shall not be required to compensate a Lender or L/C Issuer pursuant
to the foregoing provisions of this Section 3.04 for
any increased costs incurred or reductions suffered more than nine months prior
to the date that such Lender or L/C Issuer, as the case may be, notifies
Borrower of the Change in Law giving rise to such increased costs or reductions
and of such Lender’s or L/C Issuer’s intention to claim compensation
therefor (except that, if the Change in Law giving rise to such increased costs
or reductions is retroactive, then the nine-month period referred to in this
subsection (d) shall be extended to include the period of retroactive
effect thereof).

 

SECTION 3.05          COMPENSATION FOR LOSSES.

 

Upon
demand of any Lender (with a copy to Administrative Agent) from time to time,
Borrower shall promptly compensate such Lender for and hold such Lender
harmless from any loss, cost or expense incurred by it as a result of:  (a) any continuation, conversion,
payment or prepayment of any Eurodollar Rate Loan on a day other than the last
day of the Interest Period for such Loan (whether voluntary, mandatory,
automatic, by reason of acceleration, or otherwise); (b) any failure by
Borrower (for a reason other than the failure of such Lender to make a Loan),
to prepay (including any failure to prepay pursuant to Section 2.05(b)(v)),
borrow, continue or convert any Loan other than to continue a Loan as, or to
convert a Loan to, a Base Rate Loan, on the date or in the amount notified by
Borrower; or (c) any assignment of a Eurodollar Rate Loan other than on
the last day of the Interest Period applicable thereto as a result of a request
by Borrower pursuant to Section 2.14 or Section 3.06; including, in each of the foregoing
cases, any loss of anticipated profits and any loss or expense arising from the
liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were
obtained.  Borrower shall also pay any
customary administrative fees charged by such Lender in connection with the
foregoing.  For purposes of calculating
amounts payable by Borrower to Lenders under this Section 3.05,
each Lender shall be deemed to have funded each Eurodollar Rate Loan made by it
at the Eurodollar Base Rate used in determining the Eurodollar

 

65

 

Rate
for such Loan by a matching deposit or other borrowing in the London interbank
offered market for a comparable amount and for a comparable period, whether or
not such Eurodollar Rate Loan was in fact so funded.

 

SECTION 3.06          MITIGATION OBLIGATIONS; ADDITIONAL
L/C ISSUER.

 

Notwithstanding
anything to the contrary contained in Section 10.01:

 

(a)           Mitigation
by Lenders.  If any
Lender requests compensation under Section 3.04,
or Borrower is required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 3.01,
or if any Lender gives a notice pursuant to Section 3.02,
then such Lender, at the request of Borrower, 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 reasonable judgment of such Lender, such
designation or assignment:  (i) would
eliminate or reduce amounts payable pursuant to Section 3.01
or Section 3.04, as the case may be,
in the future, or eliminate the need for the notice pursuant to Section 3.02, as applicable; and (ii) in each
case, would not subject such Lender to any unreimbursed cost or expense and would
not otherwise be disadvantageous to such Lender as reasonably determined by
such Lender.  Borrower hereby agrees to
pay all reasonable costs and expenses incurred by any Lender in connection with
any such designation or assignment.

 

(b)           Additional
L/C Issuer.  If
L/C Issuer may not issue Letters of Credit as a result of the limitations
set forth in Section 2.03(a)(iv)(A), then
Borrower may, if no Default exists and with the prior written consent of
Administrative Agent (which consent shall not be unreasonably withheld or
delayed):  (i) request one of the
other Working Capital Lenders (with such other Working Capital Lender’s
consent) to issue Letters of Credit; or (ii) designate a supplemental bank
or financial institution, which is an Eligible Assignee and otherwise
satisfactory to Administrative Agent, to issue Letters of Credit and become an
additional “L/C Issuer” hereunder.

 

SECTION 3.07          REMOVAL OR REPLACEMENT OF
LENDERS.

 

Notwithstanding
anything to the contrary contained in Section 10.01:

 

(a)           Removal
or Replacement of Lenders Generally.  Borrower may with respect to any Specified
Lender:

 

(i)            remove such
Specified Lender by terminating such Specified Lender’s Commitments;

 

(ii)           request one or
more of the other Lenders to acquire and assume all of such Specified Lender’s
Loans (including participations in L/C Obligations and in Swing Line
Loans) and Commitments, which Lender or Lenders shall have the right, but not
the obligation, to so acquire and assume such Specified Lender’s Loans
(including participations in L/C Obligations and in Swing Line Loans) and
Commitments pursuant to the procedures set forth in Section 10.06(b);
or

 

66

 

(iii)          with the prior
written consent of Administrative Agent and L/C Issuer (which consent
shall not be unreasonably withheld or delayed), designate a replacement bank or
financial institution that is an Eligible Assignee (a “Replacement
Lender”), which Replacement Lender shall assume all of the Loans
(including participations in L/C Obligations and in Swing Line Loans) and
Commitments of such Specified Lender pursuant to the procedures set forth in Section 10.06(b);

 

provided that Borrower may not remove such Specified Lender,
or require such Specified Lender to make any assignment and delegation,
pursuant to the immediately preceding clauses (i), (ii) or (iii), as
applicable, if:  (1) a Default then
exists; (2) prior to the effectiveness of any such action, such Specified
Lender is no longer a Specified Lender as a result of it no longer being a
Defaulting Lender; or (3) Borrower has not concurrently taken an action
under clause (i), clause (ii) or clause (iii) of this
subsection (a) with respect to all other Lenders who at the time are
Specified Lenders.

 

Any removal of, or assignment and delegation by, a Specified Lender
pursuant to this Section 3.07(a) shall be
subject to Section 3.05 and to payment
to such Specified Lender of the aggregate Outstanding Amount of all of its
Loans (including participations in L/C Obligations and in Swing Line
Loans) at the time owing to it, all accrued and unpaid interest thereon, all
accrued and unpaid fees and all other amounts payable to it hereunder, which
amounts shall be paid to such Specified Lender by:  (A) in the case of a removal of such
Specified Lender, Borrower; or (B) in the case of an assignment and
delegation by such Specified Lender, the applicable assignee (to the extent of
all such outstanding principal and accrued and unpaid interest and fees) and
Borrower (to the extent of all such other amounts).

 

(b)           Certain
Actions Incident to Removal.  In the case of the removal of any Specified
Lender pursuant to Section 3.07(a)(i),
Borrower shall also:  (i) provide
appropriate assurances and indemnities (which may include letters of credit) to
L/C Issuer and such Specified Lender as L/C Issuer and such Specified Lender
may reasonably require with respect to any continuing obligation to purchase
participation interests in any L/C Obligations then outstanding; and
(ii) release such Specified Lender from its obligations under the Loan
Documents.  Each Lender hereby grants to
Administrative Agent a power of attorney (which power of attorney, being
coupled with an interest, is irrevocable) to execute and deliver, on behalf of
such Lender, as assignor, any Assignment and Assumption necessary to effectuate
any assignment of such Lender’s interests hereunder in circumstances
contemplated by this Section 3.07.

 

(c)           Certain
Rights as a Lender.  Upon the
prepayment of all amounts owing to any Specified Lender and the termination of
such Lender’s Commitments pursuant to this Section 3.07,
such Specified Lender shall no longer constitute a “Lender”
for purposes hereof; provided that
any rights of such Specified Lender to indemnification hereunder shall survive
as to such Specified Lender.

 

(d)           Evidence
of Removal or Replacement.  Promptly following the removal or replacement
of any Affected Lender in accordance with this Section 3.07,
Administrative Agent shall distribute an amended Schedule 2.01,
which shall be deemed incorporated into this Agreement, to reflect changes in
the identities of Lenders and adjustments of their respective Commitments or
Percentage Shares, as applicable, resulting from any such removal or
replacement.

 

67

 

SECTION 3.08          SURVIVAL.

 

All
obligations of Borrower under this Article III
shall survive termination of the Aggregate Commitments and repayment of all
other Obligations.

 

ARTICLE IV

CONDITIONS PRECEDENT

 

SECTION 4.01          CONDITIONS TO EFFECTIVENESS AND
TO INITIAL CREDIT EXTENSION.

 

This
Agreement shall become binding on the parties hereto upon, and the obligation
of each Lending Party to make its initial Credit Extension hereunder is subject
to, the satisfaction of the following conditions precedent (all Loan Documents
and other documents to be delivered to Administrative Agent or any Lending
Party pursuant to this Section 4.01
shall be subject to prior approval as to form and substance (including as to
results) by Lending Parties and Administrative Agent, with delivery by a
Lending Party or Administrative Agent of its signature page to this
Agreement evidencing such Person’s acknowledgement that the conditions set
forth in this Section 4.01 have been
satisfied, unless otherwise waived in writing):

 

(a)           Receipt
of Certain Documents. 
Administrative Agent shall have received the following, each of which
shall be in form and substances satisfactory to the Administrative Agent and
each of which shall be, unless otherwise specified herein or otherwise required
by Administrative Agent, originals (or telefacsimiles or portable document
format versions thereof (in either such case, promptly followed by originals
thereof), each, to the extent to be executed by a Loan Party, properly executed
by a Responsible Officer of such Loan Party, each dated the Closing Date (or,
in the case of certificates of governmental officials, a recent date before the
Closing Date), all in sufficient number as Administrative Agent shall
separately identify (including, if specified by Administrative Agent, for
purposes of the distribution thereof to Administrative Agent, Lending Parties
and Borrower):

 

(i)            counterparts of this
Agreement, executed by each of the parties hereto;

 

(ii)           if requested by Swing Line
Lender or any Lender, a Note or Notes (as the case may be) executed by Borrower
in favor of such Lending Party evidencing, as applicable, the Working Capital
Loans, Floorplan Loans or Swing Line Loans to be made by such Lending Party to
Borrower;

 

(iii)          counterparts of the other
Loan Documents (including all applicable Collateral Documents, executed by each
of the parties thereto, together with:

 

(A)          any certificated securities representing shares of
Equity Interests owned by or on behalf of any Loan Party constituting
Collateral as of the Closing Date after giving effect to the Transactions
together with undated stock powers with respect thereto executed in blank;

 

68

 

(B)           any promissory notes and other instruments evidencing
all loans, advances and other debt owed or owing to any Loan Party constituting
Collateral as of the Closing Date after giving effect to the Transactions
together with undated instruments of transfer with respect thereto executed in
blank;

 

(C)           all instruments and other documents, including UCC
financing statements, required by law or reasonably requested by the
Administrative Agent to be filed, registered or recorded to create or perfect
the Liens intended to be created under the Security Agreement; and

 

(D)          a Perfection Certificate with respect to the Loan
Parties, dated the Closing Date and duly executed by a Responsible Officer of
Borrower together with results of a search of the UCC (or equivalent) filings
made and tax and judgment lien searches with respect to the Loan Parties in the
jurisdictions contemplated by the Security Agreement and copies of the
financing statements (or similar documents) disclosed by such search and
evidence reasonably satisfactory to the Administrative Agent that the Liens
indicated by such financing statements (or similar documents) are permitted by Section 7.01 or have been released.

 

(iv)          such certificates of
resolutions or other action, incumbency certificates or other certificates of
Responsible Officers of each Loan Party as Administrative Agent may reasonably
require evidencing the identity, authority and capacity of each Responsible
Officer thereof authorized to act as a Responsible Officer in connection with
the Loan Documents to which such Loan Party is a party;

 

(v)           such documents and
certifications as Administrative Agent may reasonably require to evidence that
each Loan Party is duly organized or formed, and that each Loan Party is
validly existing, in good standing and qualified to engage in business in:  (A) the State of North Dakota; and
(B) each jurisdiction where its ownership, lease or operation of
properties or the conduct of its business requires such qualification, except
to the extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect;

 

(vi)          Intercreditor Agreements as
Administrative Agent may require for the Permitted Floorplan Debt;

 

(vii)         favorable opinions of
counsel to the Loan Parties reasonably acceptable to Administrative Agent
addressed to Administrative Agent and each Lending Party, as to such matters as
are reasonably required by Administrative Agent or any Lending Party with
respect to the Loan Parties and the Loan Documents;

 

(viii)        a certificate of a
Responsible Officer of each Loan Party either: 
(A) attaching copies of all consents, licenses and approvals
required in connection with the execution, delivery and performance by such
Loan Party and the validity against such Loan Party of the Loan Documents to
which it is a party, and such consents, licenses and approvals shall be in full
force and effect; or (B) stating that no such consents, licenses or
approvals are so required;

 

69

 

(ix)           a certificate signed by a
Responsible Officer of each Loan Party certifying that:  (A) the conditions specified in Section 4.02(a) and Section 4.02(b) have
been satisfied; and (B) there has been no event or circumstance since the
date of the Audited Financial Statements that has had or could be reasonably
expected to have, either individually or in the aggregate, a Material Adverse
Effect;

 

(x)            a landlord consent
agreement, in form and substance satisfactory to the Administrative Agent, from
each lessor of real property with respect to which a Loan Party is a lessee
(other than real property designated by the Administrative Agent in its sole
discretion), provided that a landlord consent agreement shall not be required
if the Administrative Agent, in its sole discretion, does not require the same;

 

(xi)           evidence that all insurance
required to be maintained pursuant to the Loan Documents has been obtained and
is in effect;

 

(xii)          a duly completed Compliance
Certificate as of the last day of the Fiscal Period of Borrower ended July 31,
2010, signed by an appropriate Responsible Officer of Borrower;

 

(xiii)         a copy,
certified by an appropriate Responsible Officer of Borrower, of the financial
statements of Borrower referred to in Section 5.11;

 

(xiv)        evidence that:
(A) all commitments under the Existing Facilities to be Paid Off and any
secured facilities not otherwise permitted under Section 7.02
have been terminated not later than the Closing Date, and all outstanding
amounts thereunder paid in full; and (B) all Liens securing obligations
under the Existing Facilities to be Paid Off and any secured facilities not
otherwise permitted under Section 7.02
have been released and terminated not later than the Closing Date; and

 

(xv)         waivers, in the
form and substance required by Section 6.15,
for either 75% of Borrower’s locations or for locations where not less that 75%
of the Collateral which is Equipment and Inventory is located, or such lesser
percentage as is agreed to by Administrative Agent, but no less than 50%.

 

(xvi)        such other assurances,
certificates, documents, consents, reports or opinions as Administrative Agent
or any Lending Party may reasonably require.

 

(xvii)       Others TBD.

 

(b)           [Reserved].

 

(c)           Payment
of Fees.  Borrower
shall have paid:  (i) all fees
required to be paid to Administrative Agent and any Lending Party on or before
the Closing Date; and (ii) unless Administrative Agent shall have agreed
in writing to any delay in such payment, all fees, charges and disbursements of
counsel to Administrative Agent to the extent invoiced prior to or on the
Closing Date, plus such additional amounts of
such fees, charges and disbursements as shall constitute its reasonable
estimate of such fees, charges and disbursements incurred or to be incurred by
it through the closing

 

70

 

proceedings
(provided that such estimate shall not
thereafter preclude a final billing by the Administrative Agent to Borrower).

 

Notwithstanding
anything to the contrary contained herein, this Agreement shall not become
effective or be binding on any party hereto unless all of the conditions
precedent to the effectiveness of this Agreement as specified in this Section 4.01(a) are satisfied at or before 1:00 p.m.
on October 27, 2010.  Administrative
Agent shall promptly notify each Loan Party and each Lending Party of the
occurrence of the Closing Date, and such notice shall be conclusive and binding
on all parties hereto.  For purposes of
determining compliance with the conditions specified in this Section 4.01 (but without limiting the generality of
the provisions of Section 9.04),
each Lending Party that has signed this Agreement shall be deemed to have
consented to, approved or accepted or become satisfied with, each document or
other matter required hereunder to be consented to or approved by or to be acceptable
or satisfactory to a Lending Party unless Administrative Agent shall have
received notice from such Lending Party prior to the proposed Closing Date
specifying its objection thereto.

 

SECTION 4.02          CONDITIONS TO ALL CREDIT
EXTENSIONS.

 

The
obligation of each Lending Party to make any Credit Extension (including its
initial Credit Extension) hereunder or to honor any Request for Credit
Extension is subject to the following conditions precedent:

 

(a)           Truth
and Correctness of Representations and Warranties.  The representations and warranties of
Borrower and each other Loan Party contained in Article V
or any other Loan Document, or that are contained in any document furnished at
any time under or in connection herewith or therewith, shall be true and correct
on and as of the date of such Credit Extension, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they shall be true and correct as of such earlier date, and except that
for purposes of this Section 4.02,
the representations and warranties contained in subsections (a) and (b) of
Section 5.11 shall be deemed to
refer to each of the Audited Financial Statements and the most recent
statements furnished pursuant to subsections (a) and (b), respectively,
of Section 6.01.

 

(b)           No
Default.  No Default
shall then exist, or shall result from, such proposed Credit Extension or from
the application of the proceeds thereof or from the honoring of any Request for
Credit Extension.

 

(c)           Requests
for Credit Extensions. 
Administrative Agent and, if applicable, Swing Line Lender or
L/C Issuer shall have received the applicable Request for Credit
Extension; provided that no L/C Applications
shall be required in connection with the Existing Letters of Credit becoming
Letters of Credit issued hereunder pursuant to the last sentence of Section 2.03(a)(i).

 

(d)           Other
Matters.  Administrative Agent shall
have received, in form and substance satisfactory to it, such other assurances,
documents or consents related to the foregoing as Administrative Agent or
Required Lenders may reasonably require.

 

Each
Request for Credit Extension submitted by Borrower shall be deemed to be a
representation and warranty that the conditions specified in Section 4.02(a) and Section 4.02(b) have
been satisfied on

 

71

 

and
as of the date of the making of the applicable Credit Extension or the honoring
of the applicable Request for Credit Extension.

 

ARTICLE V

REPRESENTATIONS AND WARRANTIES

 

Borrower
represents and warrants to Administrative Agent and each Lending Party that:

 

SECTION 5.01          CORPORATE EXISTENCE AND POWER.

 

Each
of the Loan Parties and their respective Subsidiaries:  (a) is a corporation, partnership or
limited liability company duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation, organization or
formation (subject to such changes after the date hereof as are permitted under
the Loan Documents); (b) has the power and authority and all governmental
licenses, authorizations, consents and approvals:  (i) to own its assets and carry on its
business, except to the extent that any failure to have any of the foregoing
could not reasonably be expected to have a Material Adverse Effect; and
(ii) to execute, deliver, and perform its obligations under the Loan
Documents to which each is a party; and (c) is duly qualified as a foreign
corporation, partnership or limited liability company, as applicable, and is
licensed and in good standing under the laws of each jurisdiction where its
ownership, leasing or operation of property or the conduct of its business
requires such qualification or license, except to the extent that the failure
to do so could not reasonably be expected to have a Material Adverse Effect.

 

SECTION 5.02          CORPORATE AUTHORIZATION; NO
CONTRAVENTION.

 

The
execution and delivery by each of the Loan Parties and their respective
Subsidiaries, and the performance by each of the Loan Parties and their
respective Subsidiaries of its obligations under, each Loan Document to which
such Person is party have been duly authorized by all necessary corporate or
other organizational action, and do not and will not:  (a) contravene the terms of any of such
Person’s Organizational Documents; (b) conflict with or result in any
breach or contravention of, or the creation of any Lien under, or require any
payment to be made under:  (i) any
Contractual Obligation to which such Person is a party or affecting such Person
or the properties of such Person or any Subsidiary thereof which could
reasonable be expected to have a Material Adverse Effect or (ii) any
order, injunction, writ or decree of any Governmental Authority or any arbitral
award to which such Person or its property is subject; or (c) violate any
Law.  Each of the Loan Parties and their
respective Subsidiaries are in compliance with all Contractual Obligations
referred to in clause (b)(i), except to the extent that any failure to be
in compliance could not reasonably be expected to have a Material Adverse
Effect.  No Loan Party or any Subsidiary
thereof is a party to or is bound by any Contractual Obligation, or is subject
to any restriction in any Organizational Document, or any requirement of Law,
which could reasonably be expected to have a Material Adverse Effect.

 

SECTION 5.03          GOVERNMENTAL AUTHORIZATION;
COMPLIANCE WITH LAWS.

 

(a)           Governmental
Authorizations.  No approval,
consent, exemption, authorization, or other action by, or notice to, or filing
with, any Governmental Authority is necessary or required in

 

72

 

connection
with the execution and delivery by any Loan Party (or any Subsidiary thereof)
of, or the performance by any Loan Party (or any Subsidiary thereof) of its
obligations under, any Loan Document to which it is a party other than (i) such
as have been obtained or made and are in full force and effect, (ii) filings
necessary to perfect Liens created by the Loan Documents or (iii) filings
with the SEC.

 

(b)           Compliance
with Laws.  Each Loan
Party and each Subsidiary thereof are in compliance in all material respects
with the requirements of all Laws and all orders, writs, injunctions and
decrees applicable to it or to its properties, except in such instances in
which:  (i) such requirement of Law
or order, writ, injunction or decree is being contested in good faith by
appropriate proceedings diligently conducted; or (ii) the failure to
comply therewith, either individually or in the aggregate, could not reasonably
be expected to have a Material Adverse Effect, subject to limitations as to
enforceability which might result from bankruptcy, insolvency, moratorium and
other similar laws affecting creditors rights generally to limitations on the
availability of equitable remedies.

 

SECTION 5.04          BINDING EFFECT.

 

This
Agreement has been, and each other Loan Document (when delivered hereunder)
will have been, duly executed and delivered by each Loan Party that is party
thereto.  This Agreement and each other
Loan Document to which any Loan Party is a party constitute the legal, valid
and binding obligations of such Loan Party, enforceable against such Loan Party
in accordance with their respective terms.

 

SECTION 5.05          LITIGATION.

 

Except
as specifically disclosed on Schedule 5.05,
there are no actions, suits, proceedings, claims or disputes pending, or to the
best knowledge of Borrower, threatened or contemplated, at law, in equity, in
arbitration or before any Governmental Authority, against any Loan Party or any
Subsidiary of any Loan Party that:  (a) purport
to affect or pertain to any Loan Document, or any of the transactions
contemplated thereby; or (b) could reasonably be expected to have a
Material Adverse Effect.  No injunction,
writ, temporary restraining order or any order of any nature has been issued by
any court or other Governmental Authority purporting to enjoin or restrain the
execution, delivery or performance of this any Loan Document, or directing that
the transactions provided for therein not be consummated as therein
provided.  Since the Closing Date, there
has been no change in the status of the any matters disclosed on Schedule 5.05 that, individually or in the aggregate,
has resulted in, or materially increased the likelihood of, a Material Adverse
Effect.

 

SECTION 5.06          NO DEFAULTS.

 

No
Default exists or would result from the incurring of any Obligations by
Borrower or from the grant and perfection of the Liens upon the Collateral in
favor of Administrative Agent.  As of the
Closing Date, none of Borrower, any other Loan Party or any Subsidiary of any
Loan Party is in default under or with respect to any Contractual Obligation in
any respect that, individually or together with all such defaults, could
reasonably be expected to have a Material Adverse Effect, or that would, if
such default had occurred after the Closing Date, create an Event of Default
under Section 8.01(e).

 

73

 

SECTION 5.07          EMPLOYEE BENEFIT PLANS.

 

(a)           Compliance
with ERISA Generally.  As of
the Closing Date, each Plan is in compliance with the applicable provisions of
ERISA, the Code and other federal or state law except to the extent to which
the failure to so comply could not reasonably be expected to have a Material
Adverse Effect.  Each Plan which is
intended to qualify under subsection 401(a) of the Code has received
a favorable determination letter from the IRS and, to the best knowledge of
Borrower, nothing has occurred that would cause the loss of such
qualification.  As of the Closing Date,
Borrower and each ERISA Affiliate have made all required contributions to any
Plan subject to Section 412 of the Code, and no application for a funding
waiver or an extension of any amortization period pursuant to Section 412
of the Code has been made with respect to any Plan.

 

(b)           No
Actions.  As of the
Closing Date:  (i) there are no
pending or, to the best knowledge of Borrower, threatened claims, actions or
lawsuits, or action by any Governmental Authority, with respect to any Plan
that has resulted or could reasonably be expected to result in a Material
Adverse Effect; and (ii) there has been no prohibited transaction or
violation of the fiduciary responsibility rules with respect to any Plan
that has resulted or could reasonably be expected to result in a Material
Adverse Effect.

 

(c)           Certain
Events.  As of the Closing Date:  (i) no ERISA Event has occurred or is
reasonably expected to occur; and (ii) no event or circumstance has
occurred or exists that, if such event or circumstance had occurred or arisen after
the Closing Date, would create an Event of Default under Section 8.01(i).

 

SECTION 5.08          USE OF PROCEEDS.

 

Borrower
will use the Letters of Credit and the proceeds of the Loans solely for the
purposes set forth in and as permitted by Section 6.11
and Section 7.10.

 

SECTION 5.09          TITLE TO PROPERTIES.

 

Each
Loan Party and each Subsidiary thereof have good record and marketable title in
fee simple to, or valid leasehold interests in, or valid rights to use
(including easements) all real property necessary to the ordinary conduct of
their respective businesses, except for such defects in title as could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.  As of the Closing Date,
the properties of each Loan Party and each Subsidiary thereof are subject to no
Liens other than Permitted Liens.

 

SECTION 5.10          TAXES.

 

Each
Loan Party and each Subsidiary thereof have filed all Federal and other
material tax returns and reports required to be filed, and have paid prior to delinquency
all Federal and other material taxes, assessments, fees and other governmental
charges levied or imposed upon them or their properties, income or assets
otherwise due and payable, except those that are being contested in good faith
by appropriate proceedings timely instituted and diligently conducted and for
which such Person has set

 

74

 

aside
adequate reserves, if any, on its financial statements in accordance with
GAAP.  There is no proposed tax assessment
against any Loan Party or any Subsidiary thereof that would, if made, have a
Material Adverse Effect.

 

SECTION 5.11          FINANCIAL CONDITION.

 

(a)           Financial
Statements.

 

(i)            The Audited
Financial Statements:  (A) were
prepared in accordance with GAAP consistently applied throughout the period
covered thereby, except as otherwise expressly noted therein; (B) fairly
present the consolidated financial condition of Borrower as of the date thereof
and its consolidated results of operations for the period covered thereby in
accordance with GAAP consistently applied throughout the period covered
thereby, except as otherwise expressly noted therein; and (C) show, on a
consolidated basis, all material indebtedness and other material liabilities,
direct or contingent, of Borrower as of the date thereof, including liabilities
for taxes, material commitments and Debt required under GAAP.

 

(ii)           The unaudited
consolidated balance sheet of Borrower July 31, 2010, and the related
consolidated statements of income or operations and cash flows for the Fiscal
Period ended on such date:  (i) were
prepared in accordance with GAAP consistently applied throughout the period
covered thereby, except as otherwise expressly noted therein; and
(ii) fairly present the consolidated financial condition of Borrower as of
the date thereof and their results of operations for the period covered
thereby, subject, in the case of clauses (i) and (ii), to the absence of
footnotes and to normal year-end adjustments.

 

(b)           No
Material Adverse Effect.  Since
the date of the Audited Financial Statements, there has been no event or
circumstance, either individually or in the aggregate, that has had or could
reasonably be expected to have a Material Adverse Effect.

 

SECTION 5.12          ENVIRONMENTAL MATTERS.

 

Each
Loan Party conducts in the ordinary course of business a review of the effect
of existing Environmental Laws and existing Environmental Claims on its
business, operations and properties, and as a result thereof each Loan Party
has reasonably concluded that, except as specifically disclosed on Schedule 5.12, such Environmental Laws and
Environmental Claims could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. 
Since the date hereof, there has been no change in the status of the
matters disclosed on Schedule 5.12 that,
individually or in the aggregate, has resulted in, or materially increased the
likelihood of, a Material Adverse Effect.

 

SECTION 5.13          MARGIN REGULATIONS; REGULATED
ENTITIES.

 

Neither
Borrower nor any Subsidiary thereof is engaged or will engage, principally or
as one of its important activities, in the business of purchasing or carrying
margin stock (within the meaning of Regulation U issued by the FRB), or
extending credit for the purpose of purchasing or carrying margin stock.  None of Borrower, any Subsidiary thereof or
any Person controlling Borrower is an “investment

 

75

 

company”
within the meaning of the Investment Company Act of 1940.  Borrower is not subject to regulation under
the Federal Power Act, any state public utilities code or any other Federal or
state statute or regulation limiting its ability to incur Debt.

 

SECTION 5.14          SWAP OBLIGATIONS.

 

Neither
Borrower nor any Subsidiary thereof has incurred any outstanding obligations
under any Swap Contracts, other than obligations under Swap Contracts expressly
permitted hereby.  Borrower has
voluntarily entered into each Swap Contract to which it is a party based upon
its own independent assessment of its consolidated assets, liabilities and
commitments, in each case as an appropriate means of mitigating and managing
risks associated with such matters, and has not relied on any swap counterparty
or any Affiliate of any swap counterparty in determining whether to enter into
any Swap Contract.

 

SECTION 5.15          INTELLECTUAL PROPERTY.

 

Borrower
and each Subsidiary thereof own or are licensed or otherwise have the right to
use all of the patents, trademarks, service marks, trade names, copyrights,
contractual franchises, authorizations and other rights that are reasonably
necessary for the operation of their respective businesses, except for those
the failure of which to own or license could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.  The use of such intellectual property by
Borrower and its Subsidiaries and the operation of their respective businesses
do not infringe any valid and enforceable intellectual property rights of any
other Person, except to the extent any such infringement could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.  No slogan or other
advertising device, product, process, method, substance, part or other material
now employed, or now contemplated to be employed, by Borrower or any Subsidiary
thereof infringes upon any rights held by any other Person, except to the
extent any such infringement could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.  Except as specifically disclosed on Schedule 5.05, no claim or litigation regarding any of
the foregoing is pending or, to Borrower’s knowledge, threatened, and no patent,
invention, device, application, principle or any statute, law, rule,
regulation, standard or code is pending or, to Borrower’s knowledge, proposed,
which could, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

 

SECTION 5.16          EQUITY INTERESTS HELD BY
BORROWER; EQUITY INTERESTS IN BORROWER.

 

As
of the Closing Date:  (a) the only
Subsidiaries of Borrower are those listed on Schedule 5.16;
and (b) Borrower holds no Equity Interests in any other Person other than those
specifically disclosed on Schedule 5.16.  All of the outstanding Equity Interests in
Borrower and in each Subsidiary thereof have been validly issued and are fully
paid and nonassessable.

 

SECTION 5.17          INSURANCE.

 

The
properties of each Loan Party and each Subsidiary thereof are insured with
financially sound and reputable insurance companies that are not Affiliates of
any of the Loan Parties, in such amounts,

 

76

 

with
such deductibles and covering such risks as are customarily carried by
companies engaged in similar businesses and owning similar properties in
localities where such Loan Party or its Subsidiary operates.

 

SECTION 5.18          COLLATERAL AND COLLATERAL
DOCUMENTS.

 

(a)           Enforceable
and Perfected Security Interest.

 

(i)            The Security
Agreement creates in favor of the Administrative Agent, for the benefit of the
Secured Parties, a legal, valid and enforceable security interest in the
Collateral (as defined in the Security Agreement) and the proceeds thereof (the
“Security Interest”) and (i) when
the Pledged Collateral (as defined in the Security Agreement) are delivered to
the Administrative Agent together with the proper endorsements, the Security
Interest therein shall be perfected, (ii) when each financing statement in
the form attached to the Perfection Certificate (each a “Financing
Statement”) is filed in the applicable office set forth in Schedule 5.18, the Security Interest (other than with
respect to Intellectual Property, as defined in the Security Agreement) shall
be perfected to the extent the Security Interest may be perfected by the filing
of a UCC financing statement.

 

(ii)           Upon the
recordation of the Security Agreement (or a short-form security agreement in
form and substance reasonably satisfactory to Borrower and the Administrative
Agent) with the United States Patent and Trademark Office and the United States
Copyright Office, and the filing of each Financing Statement in the office
indicated therein, the Security Interest in the Intellectual Property shall be
perfected.

 

(iii)          Each deposit
account control agreement and securities account deposit account control
agreement perfects the Security Interest in each deposit account and securities
account, respectively, subject thereto.

 

(b)           Truth
and Correctness of Representations and Warranties.  To the best knowledge after due inquiry of
any Responsible Officer of Borrower, all representations and warranties of each
Loan Party in each Collateral Document are true and correct in all material
respects except to the extent they relate to a prior date.

 

SECTION 5.19          LABOR RELATIONS.

 

There
are no strikes, lockouts or other material labor disputes against Borrower or
any Subsidiary thereof, or to Borrower’s knowledge, threatened against or
affecting Borrower or any Subsidiary thereof, and no significant unfair labor
practice complaint is pending against Borrower or any Subsidiary thereof or, to
the knowledge of Borrower, threatened against any of them before any
Governmental Authority.  Except as set
forth on Schedule 5.19:  (a) Borrower is not a party to any
collective bargaining agreements or contracts; and (b) no union
representation exists and, to the knowledge of Borrower, no union organizing
activities are taking place.

 

77

 

SECTION 5.20          SOLVENCY.

 

Borrower,
as well as each Subsidiary thereof, is Solvent.

 

SECTION 5.21          FULL DISCLOSURE.

 

To
the best knowledge after due inquiry of any Responsible Officer of Borrower,
none of the representations or warranties made by any Loan Party in the Loan
Documents as of the date such representations and warranties are made or deemed
made, and no statements contained in any exhibit, report, statement or
certificate furnished by or on behalf of any Loan Party in connection with the
Loan Documents (including the offering and disclosure materials delivered by or
on behalf of any Loan Party to Administrative Agent and Lending Parties (or any
of the foregoing Persons) prior to the Closing Date), contains any untrue statement
of a material fact or omits any material fact required to be stated therein or
necessary to make the statements made therein, in light of the circumstances
under which they are made, not misleading as of the time when made or
delivered; provided that with respect to projected
financial information, Borrower represents only that such information was
prepared in good faith based upon assumptions believed to be reasonable at the
time.

 

ARTICLE VI

AFFIRMATIVE COVENANTS

 

So
long as any Lender shall have any Commitment hereunder, any Loan or other
Obligation (other than unasserted contingent indemnification obligations and
other hedging obligations not related to this Credit Facility) shall remain
unpaid or unsatisfied or any Letter of Credit shall remain outstanding:

 

SECTION 6.01          FINANCIAL STATEMENTS.

 

To
the extent not available publicly on EDGAR, Borrower shall deliver to
Administrative Agent a sufficient number of copies for delivery by
Administrative Agent to each Lender, in form and detail satisfactory to
Administrative Agent and Required Lenders:

 

(a)           Annual
Financial Statements.  As
soon as available, but in any event within ninety (90) days after the end of
each fiscal year of Borrower, a consolidated balance sheet for Borrower and its
Subsidiaries as at the end of such fiscal year, and the related consolidated
statements of income or operations, shareholders’ equity and cash flows for
such fiscal year, setting forth, in each case in comparative form, the figures
for the previous fiscal year, all in reasonable detail and prepared in
accordance with GAAP, such consolidated statements to be audited and
accompanied by a report and opinion of an independent certified public
accountant of nationally recognized standing reasonably acceptable to Required Lenders,
which report and opinion shall be prepared in accordance with generally
accepted auditing standards and shall not be subject to any “going concern” or
like qualification or exception or any qualification or exception as to the
scope of such audit;

 

(b)           Fiscal
Period Financial Statements.  As soon as available, but in any event within
forty-five (45) days after the end of each of the first three Fiscal Periods in
each fiscal year, the financial statements filed with the SEC for such Fiscal
Period;

 

78

 

(c)           Reserved;

 

(d)           Forecasts.  As soon as available, but in any event no
later than the later of forty-five (45) days after the end of each fiscal year
of Borrower or five days following review and approval thereof by the Board of
Directors (or similar entity) of Borrower, forecasts prepared by the management
of Borrower, in form satisfactory to Administrative Agent and Required Lenders,
of consolidated balance sheets and statements of income or operations and cash
flows for Borrower and its Subsidiaries for the immediately following fiscal
year (including for the fiscal year immediately following the fiscal year in
which the Working Capital Maturity Date and/or Floorplan Maturity Date occurs);

 

(e)           Borrowing
Base Certificates.  As soon as
available, but in any event no later than thirty (30) days after the end of
each month (or more frequently during the continuance of an Event of Default,
upon request of Administrative Agent), a Borrowing Base Certificate prepared as
of the last day of such month; and

 

(f)            Monthly Reports.  No later than thirty (30) days after the last
day of each month or more frequently during the continuance of an Event of
Default if the Lender so requires with respect to each Borrower; (i) a
monthly trial balance showing Accounts outstanding aged from invoice date as
follows: 1 to 30 days, 31 to 60 days, 61 to 90 days and 91 days or more, (ii) accounts
payable, aged from invoice date as follows: 1 to 30 days, 31 to 60 days, 61 to
90 days and 91 days or more (iii) a detailed inventory report which
includes a summary of Inventory by type with a supporting perpetual inventory
report, a designation as to whether each such item of Inventory is subject to a
lien other than that of the Administrative Agent, an inventory certification
report, as at the end of such month, in each case accompanied by such
supporting detail and documentation as shall be requested by Administrative
Agent in its reasonable discretion.

 

SECTION 6.02          CERTIFICATES; OTHER INFORMATION.

 

To
the extent not available publically on EDGAR, Borrower shall deliver to
Administrative Agent a sufficient number of copies for Administrative Agent to
deliver to each Lender (and, to the extent not also a Lender, Swing Line Lender
and L/C Issuer), in form and detail satisfactory to Administrative Agent
and Required Lenders:

 

(a)           Accountants’
Certificate.  Concurrently
with the delivery of the financial statements referred to in Section 6.01(a), a certificate of its independent
certified public accountants certifying such financial statements and stating
that, in connection with their audit, nothing came to their attention that
caused them to believe that Borrower failed to comply with the terms,
covenants, provisions or conditions of Section 6.12,
insofar as such terms, covenants, provisions or conditions relate to financial
and accounting matters, but also noting that their audit was not directed
primarily toward obtaining knowledge of or noncompliance with Section 6.12;

 

(b)           Compliance
Certificate.  Concurrently
with the delivery of the financial statements referred to in subsections (a) and
(b) of Section 6.01, a duly completed
Compliance Certificate signed by an appropriate Responsible Officer of
Borrower;

 

79

 

(c)           Additional
Accountant Reports.  Promptly
after any request by Administrative Agent or any Lending Party, copies of any
detailed audit reports, management letters or recommendations submitted to the
board of directors (or the audit committee of the board of directors) of
Borrower by independent accountants in connection with the accounts or books of
Borrower or any Subsidiary thereof, or any audit of any of them;

 

(d)           Equity
Interest Holder Reports and Certain Public Filings.  Promptly after the same are available, copies
of each annual report, proxy or financial statement or other report or
communication sent to the holders of Equity Interests of Borrower and copies of
all annual, regular, periodic and special reports and registration statements
that Borrower may file or be required to file with the Securities and Exchange
Commission under Section 13 or Section 15(d) of the Exchange
Act, and, in each case, not otherwise required to be delivered to
Administrative Agent pursuant hereto;

 

(e)           Debt
Holder Reports.  Upon request
from time to time of Administrative Agent, promptly after the furnishing
thereof, copies of any statement or report furnished to any holder of debt
securities of any Loan Party or any Subsidiary thereof pursuant to the terms of
any indenture, loan or credit or similar agreement that are not otherwise
required to be furnished to Administrative Agent and Lenders pursuant to Section 6.01 or any other clause of this Section 6.02;

 

(f)            Materials
from Governmental Authorities.  Promptly, and in any event within five
Business Days after receipt thereof by any Loan Party or any Subsidiary
thereof, copies of each material notice or other correspondence received from
any Governmental Authority concerning any investigation or possible
investigation or other inquiry by such agency regarding any material financial
or other material operational results of any Loan Party or any Subsidiary
thereof; and

 

(g)           Additional
Information.  Promptly,
such additional information regarding the business, financial or corporate
affairs of any Loan Party or any Subsidiary thereof or compliance with the
terms of the Loan Documents, as Administrative Agent or any Lending Party may
from time to time reasonably request.

 

SECTION 6.03          NOTICES.

 

Borrower
shall promptly notify Administrative Agent and each Lender (and, to the extent
not also a Lender, Swing Line Lender and L/C Issuer) of:

 

(a)           Defaults.  The occurrence of any Default;

 

(b)           Matters
Involving a Material Adverse Effect.  Any matter that has resulted or could
reasonably be expected to result in a Material Adverse Effect, including any
such matter arising from:  (i) any
breach or non-performance of, or any default under, a Contractual Obligation of
any Loan Party or any Subsidiary thereof; (ii) any dispute, litigation,
investigation, proceeding or suspension between any Loan Party or any
Subsidiary thereof and any Governmental Authority; or (iii) the
commencement of, or any material development in, any litigation or proceeding
affecting any Loan Party or any Subsidiary thereof, including pursuant to any
applicable Environmental Laws;

 

(c)           ERISA
Events.  The occurrence of any ERISA
Event;

 

80

 

(d)           Certain
Acquisitions.  Any
Acquisition, or the incurrence of any Contractual Obligations with respect to
any Acquisition, by Borrower or any Subsidiary thereof, which notice shall
identify the related Acquiree(s), the anticipated or actual closing date of
such Acquisition and the aggregate cash and non-cash consideration (including
assumption of Debt) to be paid or paid in connection with such Acquisition;

 

(e)           Certain
Asset Sales.  Any Asset
Sale, or the incurrence of any Contractual Obligations with respect to any
Asset Sale, by Borrower or any Subsidiary thereof if the aggregate cash and
non-cash consideration (including assumption of Debt) in connection with such
Asset Sale is (or could reasonably be expected to become) $5,000,000 or more,
which notice shall identify the related purchaser(s), the anticipated closing
date of such Asset Sale and the aggregate cash and non-cash consideration
(including assumption of Debt) to be paid in connection with such Asset Sale;

 

(f)            Swap
Contracts.  Upon
reasonable request from time to time of Administrative Agent, the Swap Termination
Values, together with a description of the method by which such values were
determined, relating to any then-outstanding Swap Contracts to which any Loan
Party is a party;

 

(g)           Labor
Controversies.  Any material
labor controversy resulting in or to Borrower’s knowledge threatening to result
in any strike, work stoppage, boycott, shutdown or other labor disruption
against or involving any Loan Party or any Subsidiary thereof; and

 

(h)           Financial
Matters.  Any material
change in accounting policies or financial reporting practices by Borrower or
any Subsidiary thereof.

 

Each
notice pursuant to this Section 6.03 shall
be accompanied by a statement of a Responsible Officer of Borrower setting
forth details of the occurrence referred to therein and stating what action, if
any, Borrower (or the other applicable Person) has taken or proposes to take
with respect thereto (if applicable). 
Each notice given pursuant to Section 6.03(a) shall
describe with particularity any and all provisions of this Agreement and any
other Loan Document that have been (or could reasonably be expected to be)
breached or violated.

 

SECTION 6.04          PAYMENT OF CERTAIN OBLIGATIONS.

 

Borrower
shall and shall cause each of its Subsidiaries to pay and discharge prior to
delinquency all material tax liabilities, assessments and governmental charges
or levies upon their respective properties, unless the same are being contested
in good faith by appropriate proceedings timely instituted and diligently
conducted by the applicable Person and such Person has set aside adequate
reserves, if any, on its financial statements in accordance with GAAP.

 

SECTION 6.05          PRESERVATION OF EXISTENCE, ETC.

 

Borrower
shall and shall cause each of its Subsidiaries to:  (a) preserve, renew and maintain in full
force and effect their respective legal existence and good standing under the
Laws of the jurisdiction of their organization except in a transaction
permitted by Section 7.04 or Section 7.05; (b) take all reasonable action to
maintain all rights, privileges, permits, licenses and franchises necessary or
desirable

 

81

 

in
the normal conduct of their respective businesses, except to the extent that
the failure to do so could not reasonably be expected to have a Material
Adverse Effect; and (c) preserve or renew all of their respective
registered patents, trademarks, trade names and service marks and other
intellectual property, the non-preservation of which could reasonably be
expected to have a Material Adverse Effect.

 

SECTION 6.06          MAINTENANCE OF PROPERTIES.

 

Borrower
shall and shall cause each of its Subsidiaries to:  (a) maintain, preserve and protect all
of their respective material properties and equipment necessary to the
operation of their respective businesses in good working order and condition,
ordinary wear and tear excepted; and (b) make all necessary repairs
thereto and renewals and replacements thereof; in each of the foregoing
clauses (a) and (b), except where the failure to do so could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

 

SECTION 6.07          MAINTENANCE OF INSURANCE.

 

(a)           Borrower shall at all times
maintain insurance with insurers acceptable to Administrative Agent, in such
amounts and on such terms (including deductibles) and against such risks as
Administrative Agent in its sole discretion may require from time to time and
including, as applicable and without limitation, business interruption
insurance (including force majeure coverage), hazard coverage on an “all risks”
basis for all tangible Collateral, theft and physical damage coverage for
Collateral consisting of motor vehicles, commercial general liability and such
other risks and in such amounts as the Administrative Agent may reasonably request.  All insurance policies must contain an
appropriate lender’s interest endorsement or clause, and name Administrative
Agent, on behalf of itself and Lenders as an additional insured.

 

(b)           Borrower shall provide to
Administrative Agent, in a form and substance reasonably acceptable to
Administrative Agent, endorsements to (i) all hazard and business
interruption insurance naming Administrative Agent, on behalf of itself and
Lenders as loss payee and (ii) all general liability and other liability
policies naming Administrative Agent, on behalf of itself and Lenders as
additional insured.

 

SECTION 6.08          COMPLIANCE WITH LAWS.

 

Borrower
shall and shall cause each of its Subsidiaries to comply in all material
respects with the requirements of all Laws and all orders, writs, injunctions
and decrees applicable to them or to their respective properties or businesses,
except in such instances in which (a) such requirement of Law or order,
writ, injunction or decree is being contested in good faith by appropriate proceedings
timely instituted and diligently conducted; or (b) the failure to comply
therewith could not reasonably be expected to have a Material Adverse Effect.

 

SECTION 6.09          BOOKS AND RECORDS.

 

Borrower
shall and shall cause each of its Subsidiaries to:  (a) maintain proper books of record and
account, in which full, true and correct (in all material respects) entries in
conformity with GAAP

 

82

 

consistently
applied are made of all financial transactions and matters involving their
respective properties and businesses; and (b) maintain such books of
record and account in material conformity with all applicable requirements of
any Governmental Authority having regulatory jurisdiction over them, as the
case may be.

 

SECTION 6.10          INSPECTION RIGHTS.

 

(a)           Borrower shall and shall
cause each of its Subsidiaries to permit representatives and independent
contractors of Administrative Agent and each Lender to visit and inspect any of
their respective properties, to examine their corporate, financial and
operating records, and make copies thereof or abstracts therefrom, and to
discuss their respective affairs, finances and accounts with their respective
directors, officers, members, managers and independent public accountants, at
such reasonable times during normal business hours and as often as may be
reasonably desired, upon reasonable advance notice to Borrower; provided that, when an Event of Default exists,
Administrative Agent or any Lender (or any of their respective representatives
or independent contractors) may do any of the foregoing at the expense of
Borrower at any time during normal business hours and without advance notice
and as many times as Administrative Agent or any Lender may require.

 

(b)           Borrower shall and shall
cause each of its Subsidiaries to permit representatives and independent
contractors of Administrative Agent and each Lender to visit and inspect any of
their respective properties, to examine and inspect any Collateral, Inventory
or any other property of the Borrower at any time during ordinary business
hours.

 

SECTION 6.11          USE OF PROCEEDS.

 

Borrower
shall use the proceeds of the Working Capital Borrowings solely:  (a) on the Closing Date, to repay in
full all Debt outstanding under or in respect of the Existing Facilities to be
Paid Off; (b) to pay the costs associated with preparing and closing this
Credit Agreement; and (c) otherwise, for working capital and general
corporate purposes not in contravention of any Law or of any Loan Document.  Borrower shall use the proceeds of the
Floorplan Borrowings solely to provide working capital to finance Inventory and
Equipment held by a Loan Party for sale or lease to others.

 

SECTION 6.12          FINANCIAL COVENANTS.

 

(a)           Consolidated
Leverage Ratio.  Borrower
shall maintain, as at the end of each Fiscal Period ending after the Closing
Date, a Consolidated Leverage Ratio not greater than 2.50 : 1.00.

 

(b)           Consolidated
Fixed Charge Coverage Ratio.  Borrower shall maintain, as at the end of
each Fiscal Period ending after the Closing Date, a Consolidated Fixed Charge
Coverage Ratio not less than 1.25 : 1.00 for the then trailing twelve month
period.

 

SECTION 6.13     COLLATERAL VALUATIONS; COLLATERAL
AUDITS.

 

(a)           Borrower shall
and shall cause each of its Subsidiaries to permit Administrative Agent to
obtain appraisals or other valuations of Collateral from time to time, in form
and substance acceptable to

 

83

 

Administrative
Agent and at Borrower’s expense; provided as
of the Closing Date, Administrative Agent or a third party designated by
Administrative Agent shall conduct at least an annual collateral exam once each
calendar year and inventory inspections no less than each quarter.

 

(b)           Borrower shall
and shall cause each of its Subsidiaries to permit representatives and
independent contractors of Administrative Agent to audit and examine their
books, records, journals, orders, receipts and any correspondence and other
data relating to the Collateral or the business of Borrower and its
Subsidiaries.

 

SECTION 6.14          FURTHER ASSURANCES.

 

Promptly
upon the written request by Administrative Agent or Required Lenders, Borrower
shall and shall cause each of its Subsidiaries to take such further acts
(including the acknowledgement, execution, delivery, recordation, filing and
registering of documents) as may reasonably be required from time to time
to:  (a) carry out more effectively
the purposes of this Agreement or any other Loan Document; (b) subject to
the Liens created by any of the Collateral Documents any of the properties,
rights or interests covered by any of the Collateral Documents or any other
properties, rights or interests (including real property) acquired by Borrower
or any Subsidiary thereof following the Closing Date; (c) perfect and
maintain the validity, effectiveness and priority of the Liens created or
intended to be created by any of the Loan Documents; and (d) better
assure, convey, grant, assign, transfer, preserve, protect and confirm to Administrative
Agent and Lending Parties the rights, remedies and privileges existing or
granted or now or hereafter intended to be granted to such Persons under any
Loan Document or other document executed in connection therewith.  Without limiting the generality of the
foregoing, Borrower hereby agrees that: (A) within
ten (10) Business Days after any Person becomes a Subsidiary of Borrower
following the Closing Date, Borrower shall cause such Subsidiary to
(1) enter into a Joinder Agreement or otherwise deliver a Guaranty; and
(2) enter into such Collateral Documents as shall be required by
Administrative Agent so as to create, perfect and protect a Lien in favor of
Administrative Agent in all of the properties of such Person which constitute
Collateral; (B) within thirty (30)
days after any Person becomes a Foreign Subsidiary following the Closing Date,
Borrower shall cause each Loan Party owning Equity Interests therein to pledge
100% of the non-voting and 65% of the voting Equity Interests therein pursuant
to a Foreign Pledge Agreement, in form and substance satisfactory to the
Administrative Agent and (C) in
connection with the matters described in clauses (A) and (B) above,
Borrower shall deliver or cause to be delivered to the Administrative Agent,
such opinions, certificates and other documents as the Administrative Agent
shall require.

 

SECTION 6.15     LANDLORDS’ AGREEMENTS, MORTGAGEE
AGREEMENTS, BAILEE LETTERS; REAL ESTATE PURCHASES.

 

Within
30 days of the Closing Date, Borrower shall obtain a landlord’s agreement, mortgagee
agreement or bailee letter, as applicable, from the lessor of each leased
property, mortgagee of owned property or bailee with respect to 90% of Borrower’s
locations or for locations where not less that 90% of the Collateral which is
Equipment and Inventory is stored or located, which agreement or letter shall
contain a waiver or subordination of all Liens or claims that the landlord,
mortgagee or bailee may assert against the Collateral at that location, and
shall otherwise be reasonably satisfactory in form and substance acceptable to
Administrative Agent.  As to any location for which a waiver is not
delivered pursuant to the preceding sentence, Borrower shall use its
commercially reasonable best efforts to obtain

 

84

 

such
waivers, in the form and substance set forth in the preceding sentence, for
each other location where Collateral is stored or located.  With respect
to such locations or warehouse space leased or owned as of the Closing Date and
thereafter, if Administrative Agent has not received a landlord or mortgagee
agreement or bailee letter as of 30 days after the Closing Date (or, if later,
as of the date such location is acquired or leased), Borrowers’ Collateral at
that location shall, in Administrative Agent and Required Lender’s discretion,
be excluded from the Floorplan Borrowing Base or Working Capital Borrowing
Base, as applicable, or be subject to such reserves as may be established by
Administrative Agent and Required Lender in their s reasonable credit judgment
(which exclusion shall be the sole remedy for failure to meet Borrower’s
obligations under this Section 6.15).

 

SECTION 6.16     CONTROL AGREEMENTS.

 

Within
60 days of the Closing Date, Borrower shall obtain a control agreement in favor
of Administrative Agent and in form and substance acceptable to Administrative
Agent with respect to 80% of the bank accounts maintained by Borrower.  As to any bank account for which a control
agreement is not delivered pursuant to the preceding sentence or for bank
accounts opened by Borrower after the Closing Date, Borrower shall use its
commercially reasonable best efforts to obtain such control agreements, in form
and substance to Administrative Agent.

 

ARTICLE VII

NEGATIVE COVENANTS

 

So
long as any Lender shall have any Commitment hereunder, any Loan or other
Obligation (other than unasserted contingent indemnification obligations and
other hedging obligations not related to this Credit Facility) hereunder shall
remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding,
Borrower shall not and shall not permit any Subsidiary of Borrower directly or
indirectly to:

 

SECTION 7.01          LIENS.

 

Create,
incur, assume or suffer to exist any Lien upon any of its property, assets or
revenues, whether now owned or hereafter acquired, other than any of the
following (collectively, “Permitted Liens”):

 

(a)           any Lien
created under any Loan Document;

 

(b)           any Lien
existing on the date hereof and listed on Schedule 7.01
and any renewals or extensions thereof, provided
that:  (i) the property covered
thereby is not changed; (ii) the amount secured or benefited thereby is
not increased; (iii) the direct or any contingent obligor with respect
thereto is not changed; and (iv) and any renewal or extension of the
obligations secured or benefited thereby is permitted by Section 7.03(b);

 

(c)           any Lien for
tax liabilities, assessments and governmental charges or levies not yet due or
to the extent that non-payment thereof is permitted by Section 6.04;
provided that no notice of lien has been
filed or recorded under the Code;

 

85

 

(d)           any landlord’s,
grower’s, supplier’s, producer’s, carrier’s, warehouseman’s, mechanic’s,
materialman’s, repairman’s or other like Lien arising in the ordinary course of
business that is not overdue for a period of more than thirty days or that is
being contested in good faith and by appropriate proceedings timely instituted
and diligently conducted, if adequate reserves with respect thereto, if any, in
accordance with GAAP are set aside on the financial statements of the
applicable Person;

 

(e)           any pledge or
deposit in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other social security legislation,
other than any Lien imposed by ERISA;

 

(f)            any deposit to
secure the performance of bids, trade contracts or leases (other than Debt),
statutory obligations, surety bonds (other than bonds related to judgments or
litigation), performance bonds and other obligations of a like nature, in each
case incurred in the ordinary course of business;

 

(g)           any lease, sublease,
easement, right-of-way, encroachment, restriction or other similar encumbrance
affecting real property that, when aggregated with all other such Liens, is not
substantial in amount, and that does not in any case materially detract from
the value of the property subject thereto or materially interfere with the
ordinary conduct of the business of the applicable Person;

 

(h)           any Lien
securing a judgment for the payment of money not constituting an Event of
Default under Section 8.01(h) or
securing an appeal or other surety bond related to any such judgment;

 

(i)            any Lien
existing on any property prior to the acquisition thereof by Borrower or any
Subsidiary thereof or existing on any property of any Person that becomes a
Subsidiary of Borrower after the date hereof prior to the time such Person
becomes a Subsidiary of Borrower; provided
that:  (i) such Lien is not created
in contemplation of or in connection with such acquisition or such Person
becoming a Subsidiary of Borrower, as the case may be; (ii) such Lien
shall not apply to any other property or assets of Borrower or any Subsidiary
thereof; and (iii) such Lien shall secure only those obligations which it
secures on the date of such acquisition or the date such Person becomes a
Subsidiary of Borrower, as the case may be;

 

(j)            any Lien
securing obligations in respect of a capital lease on the assets subject to
such lease; provided that such capital lease is
otherwise permitted hereunder;

 

(k)           any Lien
arising solely by virtue of any statutory or common law provision relating to
banker’s liens, rights of set-off or similar rights and remedies as to deposit
accounts or other funds maintained with a creditor depository institution; provided that: 
(i) such deposit account is not a dedicated cash collateral account
and is not subject to restrictions against access by Borrower or any Subsidiary
thereof in excess of those set forth by regulations promulgated by the FRB; and
(ii) such deposit account is not intended by Borrower or any Subsidiary
thereof to provide collateral to the depository institution;

 

(l)            any Lien
securing Debt permitted under:  (i) Section 7.03(c) (but only to the extent a Lien is
otherwise permitted hereunder for the underlying Debt); or (ii) Section 7.03(d);

 

86

 

(m)          the right of a
licensee under a license agreement entered into by Borrower or any Subsidiary
thereof, as licensor, in the ordinary course of business for the use of
intellectual property or other intangible assets of Borrower or any such
Subsidiary; provided that, in the case of any such
license granted by Borrower or any such Subsidiary on an exclusive basis:  (i) such Person shall have determined in
its reasonable business judgment that such intellectual property or other
intangible assets are no longer useful in the ordinary course of business;
(ii) such license is for the use of intellectual property or other
intangible assets in geographic regions in which Borrower or any Subsidiary
thereof does not have material operations or in connection with the
exploitation of any product not then produced or planned to be produced by
Borrower or any Subsidiary thereof; (iii) such license is granted in
connection with a transaction otherwise permitted by this Agreement in which a third
party acquires the right to manufacture or sell any product covered by such
intellectual property or other intangible assets from Borrower or such
Subsidiary; provided further that, in the case of
clauses (ii) and (iii) of this subsection (m), Borrower or
such Subsidiary has determined that it is in its best economic interest to
grant such license, or (iv) such license is for use in connection with
financing provided for the benefit of Borrower’s or its Subsidiaries’
customers;

 

(n)           any Lien
securing Debt permitted under Section 7.03(f)(iii);
provided that:  (i) any such Lien does not at any time
encumber any property other than the property financed by the related Debt and
the related products and proceeds thereof; and (ii) the Debt secured
thereby does not exceed the cost or fair market value, whichever is lower, of
the property being acquired on the date of the acquisition thereof;

 

(o)           any Lien
securing Permitted Shortline Debt;

 

(p)           any Lien
securing Permitted Subordinated Debt; and

 

(q)           any Lien securing
Permitted Floorplan Debt.

 

SECTION 7.02          INVESTMENTS.

 

Make
any Investments, except:

 

(a)           Investments in
cash and Cash Equivalents; provided that
the aggregate amount thereof outstanding at any time shall not exceed
$10,000,000.00, unless the excess thereof is deposited with Administrative
Agent or invested in cash or other Cash Equivalents for which Borrower or such
Subsidiary shall have provided evidence satisfactory to Administrative Agent
that Administrative Agent shall have a perfected, first priority security
interest in such Collateral;

 

(b)           Investments
arising from transactions by Borrower or any Subsidiary thereof with customers
or suppliers in the ordinary course of business, including Investments
(including debt obligations) received in connection with the bankruptcy or
reorganization of customers and suppliers and in settlement of delinquent
obligations of, and other disputes with, customers or suppliers arising in the
ordinary course of business;

 

87

 

(c)           advances to
officers, directors, employees, shareholders, partners or members of Borrower
or any Subsidiary thereof for travel, entertainment, relocation and analogous
ordinary business purposes in a maximum aggregate amount at any time outstanding
not to exceed $500,000.

 

(d)           (i) Investments
of Borrower in any Subsidiary Guarantor; (ii) Investments of any
Subsidiary Guarantor in any other Subsidiary Guarantor; (iii) Investments
of any Subsidiary in Borrower; (iv) Investments of Borrower or any
wholly-owned Subsidiary thereof consisting of Equity Interests disclosed on Schedule 5.16; and (v) Investments permitted under
Section 7.03(k).

 

(e)           any Permitted
Acquisition;

 

(f)            Investments
made for the benefit of employees of Borrower or any Subsidiary thereof for the
purposes of deferred compensation;

 

(g)           Guarantees
permitted by Section 7.03(c);

 

(h)           Investments
consisting of Swap Contracts permitted by Section 7.03(d);

 

(i)            Investments
consisting of Capital Expenditures permitted by Section 7.07;

 

(j)            Investments
existing on the date hereof listed on Schedule 7.02;
and

 

(k)           Other
investments in an aggregate amount outstanding at any time not to exceed
$10,000,000.

 

SECTION 7.03          DEBT.

 

Create,
incur, assume or suffer to exist any Debt, except:

 

(a)           Debt under the
Loan Documents;

 

(b)           Debt
outstanding on the date hereof and listed on Schedule 7.03
and any refinancings, refundings, renewals or extensions thereof; provided that: 
(i) the amount of such Debt is not increased at the time of such
refinancing, refunding, renewal or extension except by an amount equal to a
reasonable premium or other reasonable amount paid, and fees and expenses
reasonably incurred, in connection with such refinancing and by an amount equal
to any existing commitments unutilized thereunder; and (ii) the terms
relating to principal amount, amortization, maturity, collateral (if any) and
subordination (if any), and other material terms taken as a whole, of any such
refinancing, refunding, renewing or extending Debt, and of any agreement
entered into and of any instrument issued in connection therewith, are no less
favorable in any material respect to the Loan Parties or Lenders than the terms
of any agreement or instrument governing the Debt being refinanced, refunded,
renewed or extended and the interest rate applicable to any such refinancing,
refunding, renewing or extending Debt does not exceed the then applicable
market interest rate;

 

(c)           Guarantees by
Borrower or any Subsidiary thereof of Debt (other than Debt under the Loan
Documents) otherwise permitted hereunder of Borrower or any wholly-owned
Subsidiary thereof;

 

88

 

(d)           Swap Contracts
solely to the extent such Swap Contracts: 
(i) are (or were) entered into by such Person in the ordinary
course of business for the purpose of directly mitigating risks associated with
liabilities, commitments, investments, assets, or property held or reasonably
anticipated by such Person, or changes in the value of securities issued by
such Person, and not for purposes of speculation or taking a “market view”; and
(ii) do not contain any provision exonerating the non-defaulting party
from its obligation to make payments on outstanding transactions to the
defaulting party;

 

(e)           (i) without
duplication, existing unsecured Debt, or secured to the extent permitted under Section 7.01(i), of an Acquiree outstanding at the time
of the Acquisition of such Acquiree otherwise permitted under Section 7.02(e); provided that
such Debt is not created in contemplation of or in connection with such
Acquisition or such Person becoming a Subsidiary, as the case may be; and
(ii) without duplication, unsecured Debt incurred by Borrower or any
Subsidiary thereof in connection with any Acquisition otherwise permitted under
Section 7.02(e),  consisting of Debt owed to the seller(s) in a
Permitted Acquisition representing the deferred purchase price for such
Acquisition;

 

(f)            Debt in respect
of:  (i) capital leases;
(ii) Synthetic Lease Obligations; and (iii) purchase money
obligations for fixed or capital assets within the limitations set forth in Section 7.01(n);

 

(g)           Permitted
Shortline Debt;

 

(h)           Permitted
Subordinated Debt;

 

(i)            Debt subject to
an Intercreditor Agreement acceptable to Administrative Agent and which is (i) a
floorplan facility from CNH Capital America, LLC and (ii) floorplan
facility from Agricredit Acceptance, LLC not to exceed $125 million (or a
replacement thereof).

 

(j)            Debt in respect
of:  (i) workers’ compensation
claims or obligations in respect of health, disability or other employee
benefits; (ii) property, casualty or liability insurance or
self-insurance; (iii) completion, bid, performance, appeal or surety bonds
issued for the account of Borrower or any Subsidiary thereof; or (iv) bankers’
acceptances and other similar obligations not constituting Debt for borrowed
money; in each of the foregoing cases, to the extent incurred in the ordinary
course of business;

 

(k)           Intercompany
Debt of the Borrower or any Subsidiary owing to and held by the Borrower or any
Subsidiary; provided that (i) if the Borrower
or any Subsidiary Guarantor is the obligor on such Debt and any Subsidiary
(other than a Subsidiary Guarantor) is the obligee thereof, such Debt must be
unsecured and expressly subordinated to the prior payment in full in cash of
all Obligations (including, with respect to any Subsidiary Guarantor, its
obligations under Section 10.14,
and (ii) Debt owed to the Borrower or any Subsidiary Guarantor must be
evidenced by an unsubordinated promissory note pledged to the Administrative
Agent under the applicable Collateral Document;

 

(l)            Unsecured Debt
not otherwise permitted under subsections (a) through (f) inclusive
of this Section 7.03 in an aggregate
outstanding principal amount not in excess of $5,000,000 but only to the extent
the incurrence or maintenance of such Debt would not otherwise result in an
Event of Default; or

 

89

 

(m)          Guarantees in connection
with private label credit cards of the Borrower’s customers and lease residuals
in an aggregate amount not to exceed $5,000,0000.

 

SECTION 7.04          FUNDAMENTAL CHANGES.

 

(a)           Engage in any
material line of business substantially different from those lines of business
conducted by Borrower and its Subsidiaries on the date hereof or any business
substantially related or incidental thereto regardless of geographic location;
or

 

(b)           Merge,
dissolve, liquidate, consolidate with or into another Person, or Dispose of
(whether in one transaction or in a series of transactions) all or
substantially all of its assets (whether now owned or hereafter acquired) to or
in favor of any Person, except that:

 

(i)            any Subsidiary
of Borrower may merge with: 
(A) Borrower, provided that
Borrower shall be the continuing or surviving Person; or (B) any one or
more other Subsidiaries of Borrower, provided that,
when any wholly-owned Subsidiary of Borrower is merging with another Subsidiary
of Borrower, the wholly-owned Subsidiary of Borrower shall be the continuing or
surviving Person;

 

(ii)           any Subsidiary
of Borrower may Dispose of all or substantially all of its assets (upon
voluntary liquidation or otherwise) to Borrower or to another Subsidiary of
Borrower; provided that if the transferor in such
a transaction is a wholly-owned Subsidiary of Borrower, then the transferee
must either be Borrower or a wholly-owned Subsidiary of Borrower; and

 

(iii)          Borrower or any
Subsidiary thereof may consummate any Acquisition permitted under Section 7.02(e); or

 

(c)           With respect to
any Debt where the total amount of such Debt exceeds $5,000,000.00 (as to such
Debt and not in the aggregate), other than Debt arising under the Loan
Documents or in connection with buyback obligations of equipment in the
ordinary course of business and other than with respect to Permitted Shortline
Debt and Permitted Floorplan Debt  (unless
otherwise provided in any Subordination Agreement or Intercreditor Agreement
applicable thereto), (i) make any voluntary, optional payment or
prepayment on account of, or optional redemption or acquisition for value of
any portion of, any such Debt, provided that in the case of Debt permitted
under Section 7.03(e), any such payments
or prepayments may be made on such Debt within 90 days after the closing of the
related Acquisition; or (ii) otherwise agree to amend, modify or otherwise
alter: (A) the payment terms (including any provisions regarding interest
rates, principal or interest payment or prepayment amounts, total principal
amounts or similar or related terms and provisions) of or subordination
provisions respecting any such Debt (including Permitted Subordinated Debt); or
(B) any other provision of such Debt (including Permitted Subordinated
Debt) except to the extent that:  (1) no
Default exists at the time or results by virtue of any such amendment,
modification or other alteration; or (2) such amendment, modification or
other alternation could not reasonably be expected to have a Material Adverse
Effect.

 

90

 

SECTION 7.05          DISPOSITIONS.

 

Make
any Disposition or enter into any agreement to make any Disposition, except:

 

(a)           Dispositions of
used, obsolete, surplus or worn out property, whether now owned or hereafter
acquired, in the ordinary course of business and the abandonment or other
Disposition of intellectual property that is, in the reasonable judgment of
Borrower, no longer economically practicable to maintain or useful in the
conduct of the business of Borrower and its Subsidiaries, taken as a whole;

 

(b)           Dispositions of
inventory in the ordinary course of business;

 

(c)           Dispositions of
equipment or real property to the extent that: 
(i) such property is exchanged for credit against the purchase
price of similar replacement property; or (ii) the proceeds of such
Disposition are reasonably promptly applied to the purchase price of such
replacement property;

 

(d)           Dispositions of
property by Borrower or any Subsidiary thereof to Borrower or to a wholly-owned
Subsidiary of Borrower; provided that,
if the transferor of such property is a Guarantor, the transferee thereof must
be Borrower or a Guarantor;

 

(e)           Dispositions
permitted by Section 7.04(b)(i) or Section 7.04(b)(ii), or Dispositions of Investments
permitted under Section 7.02(j) or under
Section 7.02(k);

 

(f)            Dispositions consisting
of sale and leaseback transactions which (i) are completed on arms-length
terms, (ii) for fair market value and (iii) do not exceed
$10,000,0000 for a transaction or series of related transactions, or
$20,000,000 in the aggregate in a calendar year;

 

(g)           (i) the
unwinding of any Swap Contract; (ii) to the extent permitted hereunder,
Restricted Payments; and (iii) to the extent permitted hereunder and
otherwise constituting Dispositions, Investments;

 

(h)           Dispositions of
cash and Cash Equivalents; and

 

(i)            Dispositions of
accounts receivable in connection with the compromise, settlement or collection
thereof in the ordinary course of business;

 

provided that any
Disposition pursuant to any of the foregoing subsections of this Section 7.05 shall be for not less than fair market
value.

 

SECTION 7.06          RESTRICTED PAYMENTS.

 

Declare
or make, directly or indirectly, any Restricted Payment, or incur any
obligation (contingent or otherwise) to do so, except that:  (a) each Subsidiary may make Restricted
Payments to Borrower and to wholly-owned Subsidiaries (and, in the case of a
Restricted Payment by a non-wholly-owned Subsidiary, to Borrower and any
Subsidiary and to each other owner of Equity Interests of such Subsidiary on a
pro rata basis based on their relative ownership interests); (b) Borrower
and each Subsidiary may declare and make dividend payments or other
distributions payable solely in 

 

91

 

common
Equity Interests of such Person; (c) Borrower and each Subsidiary may
purchase, redeem or otherwise acquire shares of its common Equity Interests or
warrants or options to acquire any such common Equity Interests with the
proceeds received from the substantially concurrent issue of new shares of its
common Equity Interests; (d) so long as no Default or Event of Default
exists prior to or immediately following such action or otherwise results from
such action, Borrower may declare or pay cash dividends to its holders of
Equity Interests in an amount not to exceed 50% of Consolidated Net Income for
the then trailing four (4) quarters; and (e) in lieu of issuing stock
to participants in the Borrower’s restricted stock plan, pay the associated tax
liability with other stock issued.

 

SECTION 7.07          CAPITAL EXPENDITURES.

 

Make
(whether in one transaction or a series of transactions) Capital Expenditures
in an aggregate amount for Borrower and its Subsidiaries in excess of:  (a) $9,000,000 for the period from the
Closing Date through the end of the fiscal year 2011; and (b) with respect
to any fiscal year thereafter, $18,000,000; provided that
the amount of Capital Expenditures permitted to be made by Borrower and its
Subsidiaries hereunder during any fiscal year commencing with fiscal year 2011
shall be subject to increase by an amount equal to the lesser of:  (i) the difference between the maximum
amount of Capital Expenditures permitted for the previous fiscal year (without
giving effect to any increase thereto by virtue of this proviso) and the
aggregate amount of all Capital Expenditures actually made during such previous
fiscal year and (ii) $5,000,000.

 

SECTION 7.08          TRANSACTIONS WITH AFFILIATES.

 

Enter
into any transaction of any kind with any Affiliate of Borrower, irrespective
of whether in the ordinary course of business, other than on fair and
reasonable terms substantially as favorable to Borrower or a Subsidiary of
Borrower as would be obtainable by such Person at the time in a comparable arm’s-length
transaction with a Person other than an Affiliate, provided
that the foregoing restriction shall not apply to:  (a) transactions between or among
Borrower and any Guarantor or between or among Guarantors; (b) Restricted
Payments permitted hereunder; and (c) Guarantees permitted by Section 7.03(c).

 

SECTION 7.09          BURDENSOME AGREEMENTS.

 

Enter
into any Contractual Obligation (other than this Agreement or any other Loan
Document) that:  (a) limits the
ability:  (i) of any Subsidiary of
Borrower to make Restricted Payments to Borrower or to otherwise transfer
property to Borrower; (ii) of any Subsidiary of Borrower to Guarantee the
Debt of Borrower; or (iii) of Borrower or any Subsidiary thereof to
create, incur, assume or suffer to exist Liens on property of such Person; provided that this subclause (iii) shall not prohibit
any negative pledge incurred or provided in favor of any holder of Debt
permitted under Section 7.03(b), Section 7.03(e),
Section 7.03(g), Section 7.03(h) and Section 7.03(f) solely to the extent that any
such negative pledge relates to the property financed by or the subject of such
Debt; or (b) requires the grant of a Lien to secure an obligation of such
Person if a Lien is granted to secure another obligation of such Person.

 

92

 

SECTION 7.10          USE OF PROCEEDS.

 

Use
the proceeds of any Credit Extension, whether directly or indirectly, and
whether immediately, incidentally or ultimately, to purchase or carry margin
stock (within the meaning of Regulation U of the FRB) or to extend credit
to others for the purpose of purchasing or carrying margin stock or to refund
indebtedness originally incurred for such purpose.

 

SECTION 7.11          CERTAIN GOVERNMENTAL REGULATIONS.

 

Borrower
will not, and will not permit any Subsidiary to, (a) be or become subject
at any time to any law, regulation, or list of any government agency (including
the United States Office of Foreign Asset Control list) that prohibits or
limits any Lender from making any loans or extension of credit (including the
Loans and the Letters of Credit) to any Loan Party or from otherwise conducting
business with any Loan Party, or (b) fail to provide documentary and other
evidence of any Loan Party’s identity as may be requested by any Lender or the
L/C Issuer at any time to enable such Lender or the L/C Issuer to verify any
Loan Party’s identity or to comply with any applicable law or regulation,
including Section 326 of the Act.

 

SECTION 7.12          AMENDMENT OF MATERIAL DOCUMENTS.

 

Borrower
will not, and will not permit any of the Subsidiaries to, amend, modify or
waive any of its rights under (a) any material agreements, contracts or
licenses or (b) its Organizational documents, other than in each case
amendments, modifications or waivers that could not reasonably be expected to
materially adversely affect the Administrative Agent or the Lender Parties; provided to the extent requested by the Administrative Agent
for time to time, the Borrower shall deliver or cause to be delivered to the
Administrative Agent and each Lender a copy of each such amendment, modification
or waiver promptly after the execution and delivery thereof.

 

SECTION 7.13          DISQUALIFIED EQUITY INTERESTS.

 

Borrower
will not, and will not permit any Subsidiary to, (a) issue any
Disqualified Equity Interests, or (b) be or become liable in respect of any
obligation (contingent or otherwise) to purchase, redeem, retire, acquire or
make any other payment in respect of any Equity Interests of Borrower or any
Subsidiary, except as permitted under Section 7.06.

 

SECTION 7.14          TRANSPORTATION SOLUTIONS.

 

Transportation
Solutions shall not own any assets other than assets used for or incidental to
providing transportation services to the Loan Parties, including, without
limitation, the assets set forth on Schedule 7.13
hereto.

 

93

 

ARTICLE VIII

EVENTS OF DEFAULT AND REMEDIES

 

SECTION 8.01          EVENTS OF DEFAULT.

 

Each
of the following shall constitute an event of default hereunder (each, an “Event of Default”):

 

(a)           Non-Payment.  Borrower or any other Loan Party fails to
pay:  (i) within five Business Days
when and as required to be paid herein, any amount of principal of any Loan or
any L/C Obligation; (ii) within five Business Days after the same
becomes due, any interest on any Loan or on any L/C Obligation, or any fee
due hereunder; or (iii) within five Business Days after the same becomes
due, any other amount payable hereunder or under any other Loan Document; or

 

(b)           Specific
Covenants.  Borrower
fails to perform or observe any term, covenant or agreement contained in any of
Section 6.01, Section 6.02,
Section 6.03, Section 6.05,
Section 6.10, Section 6.11,
Section 6.12 or Article VII, or any Guarantor fails to perform or
observe any term, covenant or agreement contained in its Guaranty; or

 

(c)           Representations
and Warranties.  Any
representation, warranty, certification or statement of fact made or deemed
made by or on behalf of Borrower or any other Loan Party herein, in any other
Loan Document or in any document delivered in connection herewith or therewith
shall be incorrect or misleading in any material respect when made or deemed
made; or

 

(d)           Other
Defaults.  Any Loan
Party fails to perform or observe any other covenant or agreement (not
specified in Section 8.01(a), Section 8.01(b) or Section 8.01(c))
contained in any Loan Document on its part to be performed or observed and such
failure continues for thirty days; or

 

(e)           Cross-Default.  (i) Borrower or any Subsidiary
thereof:  (A) fails to make any
payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise but after giving affect to any cure period
or waivers with respect thereto) in respect of any Debt (other than Debt
hereunder and Debt under Swap Contracts) having an aggregate principal amount
(including undrawn committed or available amounts and including amounts owing
to all creditors under any combined or syndicated credit arrangement) of more
than the Threshold Amount; or (B) fails to observe or perform (within the
cure period applicable thereto and any waivers with respect thereto) any other
agreement or condition relating to any such other Debt or contained in any
document evidencing, securing or relating to any of the foregoing, or any other
default or event occurs, the effect of which default or other event is to
cause, or to permit the holder or holders of such Debt (or a trustee or agent
on behalf of such holder or holders) to cause, with the giving of notice if
required, such Debt to be demanded or to become due or to be repurchased,
prepaid, defeased or redeemed (automatically or otherwise), or an offer to
repurchase, prepay, defease or redeem such Debt to be made, prior to its stated
maturity; or (ii) there occurs under any Swap Contract an Early
Termination Date (as defined in such Swap Contract) resulting from:  (A) any event of default under such Swap
Contract as to which Borrower or any Subsidiary thereof is the Defaulting Party
(as defined in such Swap Contract); or (B) any Termination Event (as so
defined) under such Swap Contract as to which Borrower or any Subsidiary 

 

94

 

thereof
is an Affected Party (as so defined) and, in either event, the Swap Termination
Value owed by Borrower or any such Subsidiary as a result thereof is greater
than the Threshold Amount; or

 

(f)            Insolvency
Proceedings, Etc.  Any
Loan Party or any Subsidiary thereof institutes or consents to the institution
of any proceeding under any Bankruptcy Law, or makes an assignment for the
benefit of creditors; or applies for or consents to the appointment of any
receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar
officer for it or for all or any material part of its property; or any
receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar
officer is appointed without the application or consent of such Person and the
appointment continues undischarged or unstayed for sixty calendar days; or any
proceeding under any Bankruptcy Law relating to any such Person or to all or
any material part of its property is instituted without the consent of such
Person and continues undismissed or unstayed for sixty calendar days, or an
order for relief is entered in any such proceeding; or

 

(g)           Inability
to Pay Debts; Attachment. 
(i) Any Loan Party or any Subsidiary thereof becomes unable or
admits in writing its inability or fails generally to pay its debts as they
become due; or (ii) any writ or warrant of attachment or execution or
similar process is issued or levied against all or any material part of the
property of any such Person and is not released, vacated or fully bonded within
thirty days after its issue or levy; or

 

(h)           Judgments.  There is entered against any Loan Party or
any Subsidiary thereof:  (i) a final
judgment or order for the payment of money in an aggregate amount exceeding the
Threshold Amount (to the extent not covered by independent third-party
insurance as to which the insurer does not dispute coverage); or (ii) any
one or more non-monetary final judgments that have, or could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect
and, in either case: 
(A) enforcement proceedings are commenced by any creditor upon such
judgment or order; or (B) there is a period of thirty consecutive days
during which a stay of enforcement of such judgment, by reason of a pending
appeal or otherwise, is not in effect; or

 

(i)            ERISA.  (i) An ERISA Event occurs with respect
to a Pension Plan or Multiemployer Plan which has resulted or could reasonably
be expected to result in liability of Borrower under Title IV of ERISA to
the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in
excess of the Threshold Amount; or (ii) Borrower or any ERISA Affiliate
fails to pay when due, after the expiration of any applicable grace period, any
installment payment with respect to its Withdrawal Liability under
Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in
excess of the Threshold Amount; or

 

(j)            Invalidity
of Loan Documents.  Any Loan
Document or any provision thereof, at any time after its execution and delivery
and for any reason other than as expressly permitted hereunder or thereunder or
satisfaction in full of all the Obligations, ceases to be in full force and
effect; or any Loan Party contests in any manner the validity or enforceability
of any Loan Document or any provision thereof; or any Loan Party denies that it
has any or further liability or obligation under any Loan Document, or purports
to revoke, terminate or rescind any Loan Document or any provision thereof; or

 

(k)           Liens. Any Lien
purported to be created under any Collateral Document shall cease to be, or
shall be asserted by any Loan Party not to be, a valid and perfected Lien on
any Collateral, with the

 

95

 

 

 

priority
required by the applicable Collateral Document, except (a) as a result of
the sale or other disposition of the applicable Collateral in a transaction
permitted under the Loan Documents or (b) as a result of the
Administrative Agent’s failure to maintain possession of any stock
certificates, promissory notes or other instruments delivered to it under the
Security Agreement; or

 

(l)            Change
of Control.  There occurs
a Change of Control.

 

SECTION 8.02         REMEDIES UPON EVENT OF DEFAULT.

 

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

 

(a)           Termination
of Commitments, Etc. 
Declare, by written notice to Borrower, the commitment of each Lender to
make Loans and any obligation of L/C Issuer to make L/C Credit
Extensions to be terminated, whereupon such commitments and obligation shall be
terminated;

 

(b)           Acceleration
of Obligations.  Declare the
unpaid principal amount of all outstanding Loans, all interest accrued and
unpaid thereon and all other amounts owing or payable hereunder or under any
other Loan Document to be immediately due and payable, without presentment,
demand, protest or other notice of any kind, all of which are hereby expressly
waived by Borrower;

 

(c)           Cash
Collateralization of L/C Obligations.  Require that Borrower Cash Collateralize the
L/C Obligations in an amount equal to 102.00% of the then Outstanding
Amount thereof; and

 

(d)           Exercise
of Rights and Remedies. 
Exercise on behalf of itself and Lenders all rights and remedies
available to it and Lenders under the Loan Documents;

 

provided that, upon the
occurrence of an actual or deemed entry of an order for relief with respect to
Borrower under any Bankruptcy Law, the obligation of each Lender to make Loans
and any obligation of L/C Issuer to make L/C Credit Extensions shall
automatically terminate, the unpaid principal amount of all outstanding Loans
and all interest and other amounts as aforesaid shall automatically become due
and payable, and the obligation of Borrower to Cash Collateralize the
L/C Obligations in an amount equal to 102.00% of the then Outstanding
Amount thereof shall automatically become effective, in each case, without
further act of Administrative Agent or any Lender.

 

SECTION 8.03         APPLICATION OF FUNDS.

 

Following
the occurrence of an Event of Default or any exercise of remedies provided for
in Section 8.02 (or after the Loans
have automatically become immediately due and payable and the
L/C Obligations have automatically been required to be Cash Collateralized
as set forth in the proviso to Section 8.02),
any amounts received on account of the Obligations shall be applied by
Administrative Agent in the following order (on a pro rata
basis within each level of priority):

 

96

 

(a)           First, to pay all
costs and expenses incident to the enforcement of the Loan Documents or
otherwise owing to Administrative Agent hereunder, including all attorneys’
fees and costs and all compensation to any agents, sub-agents and contractors
of Administrative Agent and Lending Parties;

 

(b)           Second, to pay all
accrued but unpaid interest on the Loans and L/C Obligations and all
accrued but unpaid letter of credit and commitment fees hereunder;

 

(c)           Third:  (i) to pay the Total Outstandings, the
Outstanding Amount of all Swing Line Loans; (ii) to Cash Collateralize all
L/C Obligations up to the Outstanding Amount thereof; (iii) to pay all
treasury management obligations owing to Administrative Agent and (iv) to
pay the total amount of Swap Obligations;

 

(d)           Fourth, to pay all
other Obligations; and

 

(e)           Fifth, to pay the
remainder, if any, to Borrower or to whomever may be lawfully entitled to
receive such remainder.

 

Notwithstanding
anything to the contrary contained in this Section 8.03:  (i) Cash Collateral for
Eurodollar Rate Loans shall be applied on the maturity date of their respective
Interest Periods to repay such Eurodollar Rate Loans; and (ii) subject to Section 2.03(c), amounts used to Cash Collateralize the
aggregate undrawn amount of Letters of Credit pursuant to clause Third  of this Section 8.03 shall be applied to satisfy drawings under
such Letters of Credit as they occur; if any amount remains on deposit as Cash
Collateral after all Letters of Credit have either been fully drawn or expired,
such remaining amount shall be applied to the other Obligations, if any, in the
order set forth in this Section 8.03.

 

ARTICLE IX

ADMINISTRATIVE AGENT

 

SECTION 9.01         APPOINTMENT AND AUTHORIZATION OF
ADMINISTRATIVE AGENT.

 

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

 

SECTION 9.02         RIGHTS AS A LENDER.

 

If
the Person serving as Administrative Agent hereunder is also “Swing Line Lender,” “L/C Issuer” or a “Lender,” such Person shall have the
same rights and powers in such capacity(ies) as any other Person in such
capacity(ies) and may exercise the same as though it were not Administrative
Agent.  Such Person and its Affiliates
may accept deposits from, lend money to, act as the financial advisor or in any
other advisory capacity for and generally engage in any kind of business with
Borrower 

 

97

 

or
any Subsidiary or Affiliate of Borrower as if such Person were not
Administrative Agent hereunder and without any duty to account therefor to any
other Lending Party.

 

SECTION 9.03         EXCULPATORY PROVISIONS.

 

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

 

(a)           No
Fiduciary Duties.  Shall not be
subject to any fiduciary or other implied duties, regardless of whether a
Default has occurred and is continuing;

 

(b)           No
Obligations Regarding Certain Actions.  Shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated hereby or by the other Loan Documents
that Administrative Agent is required to exercise as directed in writing by
Required Lenders (or such other number or percentage of Lenders as shall be
expressly provided for herein or in any other Loan Documents, Swing Line Lender
or L/C Issuer, as applicable; provided that
Administrative Agent shall not be required to take any action that, in its
opinion or the opinion of its counsel, may expose Administrative Agent to
liability or that is contrary to any Loan Document or applicable Law; and

 

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

 

(d)           Limitation
on Liability.  Shall not be
liable for any action taken or not taken by it: 
(i) with the consent or at the request of Required Lenders (or such
other number or percentage of Lenders as shall be necessary, or as
Administrative Agent shall believe in good faith shall be necessary, under the
circumstances as provided in Section 8.02
and Section 10.01); or (ii) in
the absence of its own gross negligence or willful misconduct.  Administrative Agent shall be deemed not to
have knowledge of any Default, unless and until Borrower, a Loan Party, or a
Lending Party provides written notice to Administrative Agent describing such
Default.  Administrative Agent shall not
be responsible for or have any duty to ascertain or inquire into:  (A) any statement, warranty or
representation made in or in connection with this Agreement or any other Loan
Document; (B) the contents of any certificate, report or other document
delivered hereunder or thereunder or in connection herewith or therewith;
(C) the performance or observance of any of the covenants, agreements or
other terms or conditions set forth herein or therein or the occurrence of any
Default; (D) the validity, enforceability, effectiveness or genuineness of
this Agreement, any other Loan Document or any other agreement, instrument or
document; or (E) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm
receipt of items expressly required to be delivered to Administrative Agent.

 

98

 

SECTION 9.04         RELIANCE BY ADMINISTRATIVE AGENT.

 

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

 

SECTION 9.05         DELEGATION OF DUTIES.

 

Administrative
Agent may perform any and all of its duties and exercise its rights and powers
hereunder or under any other Loan Document by or through any one or more
sub-agents it appoints.  Administrative
Agent and any such sub-agent may perform any and all of its duties and exercise
its rights and powers by or through their respective Related Parties.  The exculpatory provisions of this Article IX shall apply to any such sub-agent and to the
Related Parties of Administrative Agent and any such sub-agent and shall apply
to their respective activities in connection with the syndication of the credit
facilities provided for herein, as well as activities as Administrative Agent.  The Administrative Agent shall not be liable
for the actions or inactions of any sub-agent

 

SECTION 9.06         RESIGNATION OF ADMINISTRATIVE
AGENT.

 

Administrative
Agent may at any time give notice of its resignation to Lending Parties and
Borrower.  Upon receipt of any such
notice of resignation, Required Lenders shall have the right, with, unless an
Event of Default exists, the consent of Borrower (which consent shall not be
unreasonably withheld), to appoint a successor, which shall be a bank with an
office in the United States, or an Affiliate of any such bank with an office in
the United States.  If no such successor
shall have been so appointed by Required Lenders and shall have accepted such
appointment within thirty days after the retiring Administrative Agent gives notice
of its resignation, then the retiring Administrative Agent may on behalf of
Lending Parties, appoint a successor Administrative Agent meeting the
qualifications set forth in this Section 9.06;
provided that, if Administrative Agent
shall notify Lending Parties and Borrower that no qualifying Person has
accepted such appointment, then such resignation shall nonetheless become
effective in accordance with such notice and (a) the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder and under the other Loan Documents solely in its capacity as
Administrative Agent (except that in the case of any collateral security held
by Administrative Agent on behalf of any Lending Party under any of the Loan
Documents, the retiring Administrative Agent shall continue to hold such
collateral security until such time as a successor 

 

99

 

Administrative
Agent is appointed) and (b) all payments, communications and
determinations provided to be made by, to or through Administrative Agent shall
instead be made by or to each Lending Party directly, until such time as
Required Lenders appoint a successor Administrative Agent as provided for in
this Section 9.06.  Upon the acceptance of a successor’s
appointment as Administrative Agent hereunder, such successor shall succeed to
and become vested with all of the rights, powers, privileges and duties of the
retiring (or retired) Administrative Agent, and the retiring Administrative
Agent shall be discharged from all of its duties and obligations hereunder or
under the other Loan Documents solely in its capacity as Administrative Agent
(if not already discharged therefrom as provided in this Section 9.06).  The fees payable by Borrower to a successor Administrative
Agent shall be the same as those payable to its predecessor unless otherwise
agreed between Borrower and such successor. 
After the retiring Administrative Agent’s resignation hereunder and
under the other Loan Documents, the provisions of this Article IX
and Section 10.04 shall continue in
effect for the benefit of such retiring Administrative Agent, its sub-agents
and their respective Related Parties in respect of any actions taken or omitted
to be taken by any of them while the retiring Administrative Agent was acting
as Administrative Agent.

 

Any
resignation by Wells Fargo as Administrative Agent pursuant to this Section 9.06 shall also constitute its resignation as
L/C Issuer and Swing Line Lender. 
Upon the acceptance of a successor’s appointment as Administrative Agent
hereunder:  (i) such successor shall
succeed to and become vested with all of the rights, powers, privileges and
duties of the retiring L/C Issuer and Swing Line Lender; (ii) the
retiring L/C Issuer and Swing Line Lender shall be discharged from all of
their respective duties and obligations hereunder or under the other Loan
Documents; (iii) the successor L/C Issuer shall issue letters of
credit in substitution for the Letters of Credit, if any, outstanding at the
time of such succession or make other arrangements satisfactory to the retiring
L/C Issuer to effectively assume the obligations of the retiring
L/C Issuer with respect to such Letters of Credit and (iv) the
successor Swing Line Lender shall purchase the outstanding Swing Lines Loans of
the resigning Swing Line Lender at par.

 

SECTION 9.07         NON-RELIANCE ON ADMINISTRATIVE
AGENT AND OTHER LENDERS.

 

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

 

SECTION 9.08         NO OTHER DUTIES, ETC.

 

Notwithstanding
anything to the contrary contained herein, no Person identified herein or on
the facing page or signature pages hereof as a “Co-Documentation
Agent,” “Co-Agent,” “Book Manager,” “Book Runner,” “Arranger,” “Lead Arranger,”
“Co-Lead Arranger” or “Co-Arranger,” if any, shall have or be deemed to have
any right, power, obligation, liability, responsibility or duty under this
Agreement or the other Loan Documents, other than in such Person’s capacity
as:  (a) Administrative Agent, a
Lender, Swing Line Lender or L/C Issuer hereunder; and (b) an
Indemnitee hereunder.

 

100

 

SECTION 9.09         ADMINISTRATIVE AGENT MAY FILE
PROOFS OF CLAIM.

 

In
case of the pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to any Loan Party, Administrative Agent (irrespective of
whether the principal of any Loan or L/C Obligation shall then be due and
payable as herein expressed or by declaration or otherwise and irrespective of
whether Administrative Agent shall have made any demand on Borrower) shall be
entitled and empowered, by intervention in such proceeding or otherwise:  (a) to file and prove a claim for the
whole amount of the principal and interest owing and unpaid in respect of the
Loans, L/C Obligations and all other Obligations that are owing and unpaid
and to file such other documents as may be necessary or advisable in order to
have the claims of Lending Parties and Administrative Agent (including any
claim for the reasonable compensation, expenses, disbursements and advances of
Lending Parties and Administrative Agent and their respective agents and
counsel and all other amounts due Lending Parties and Administrative Agent
under Sections 2.03(i), Section 2.09 and Section 10.04)
allowed in such judicial proceeding; and (b) to collect and receive any
monies or other property payable or deliverable on any such claims and to
distribute the same; and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Lending Party to make such payments to
Administrative Agent and, in the event that Administrative Agent shall consent
to the making of such payments directly to Lending Parties, to pay to Administrative
Agent any amount due for the reasonable compensation, expenses, disbursements
and advances of Administrative Agent and its agents and counsel, and any other
amounts due Administrative Agent under Section 2.09
and Section 10.04.  Nothing contained herein shall be deemed to
authorize Administrative Agent to authorize or consent to or accept or adopt on
behalf of any Lending Party any plan of reorganization, arrangement, adjustment
or composition affecting the Obligations or the rights of any Lending Party or
to authorize Administrative Agent to vote in respect of the claim of any
Lending Party in any such proceeding.

 

SECTION 9.10         GUARANTY MATTERS

 

Each
Lending Party hereby: 
(a) irrevocably authorizes Administrative Agent, at its option and
in its discretion, to release any Guarantor from its obligations under a
Guaranty if such Person ceases to be a Subsidiary as a result of a transaction
permitted hereunder; and (b) agrees that, upon request by Administrative
Agent at any time, it will confirm in writing Administrative Agent’s authority
to release any such Guarantor pursuant to this Section 9.10.

 

SECTION 9.11         COLLATERAL MATTERS

 

(a)           Directions
by Lending Parties.  Each Lending
Party hereby, irrevocably authorizes and directs Administrative Agent:  (i) to enter into the Collateral
Documents for the benefit of such Person; (ii) without the necessity of
any notice to or further consent from any such Person from time to time prior
to an Event of Default, to take any action with respect to any Collateral or Collateral
Documents that may be necessary to perfect and maintain perfected the Liens
upon the Collateral granted pursuant to the Collateral Documents; (iii) to
release any Lien on any property granted to or held by Administrative Agent
under any Loan Document:  (A) upon
termination of the Aggregate Commitments and payment in full of all Obligations
(other than unasserted contingent indemnification obligations); (B) that
is sold or 

 

101

 

to
be sold as part of or in connection with any Asset Sale or other Disposition
permitted hereunder or under any other Loan Document; (C) subject to Section 10.01, if approved, authorized or ratified in
writing by Required Lenders; or (D) in connection with any foreclosure sale
or other disposition of Collateral after the occurrence of an Event of Default;
and (iv) to subordinate any Lien on any property granted to or held by
Administrative Agent under any Loan Document to the holder of any Lien on such
property that is permitted by this Agreement or any other Loan Document.  Upon request by Administrative Agent at any
time, each Lending Party will confirm in writing Administrative Agent’s
authority to release or subordinate its interest in particular types or items
of Collateral pursuant to this Section 9.11.

 

(b)           Certain
Actions by Administrative Agent.  Subject to Section 9.11(a)(iii) and
Section 9.11(a)(iv),
Administrative Agent shall (and is hereby irrevocably authorized by each
Lending Party to) execute such documents as may be necessary to evidence the
release or subordination of Liens granted to Administrative Agent herein or
pursuant hereto upon the applicable Collateral; provided
that:  (i) Administrative Agent
shall not be required to execute any such document on terms that, in
Administrative Agent’s opinion, would expose Administrative Agent to or create
any liability or entail any consequence other than the release or subordination
of such Liens without recourse or warranty; and (ii) such release or
subordination shall not in any manner discharge, affect or impair the
Obligations or any Liens upon (or obligations of Borrower or any other Loan
Party in respect of) all interests retained by Borrower or any other Loan
Party, including the proceeds of the sale, all of which shall continue to
constitute part of the Collateral.  In
the event of any sale or transfer of Collateral, or any foreclosure with
respect to any of the Collateral, Administrative Agent shall be authorized to
deduct all expenses reasonably incurred by Administrative Agent from the
proceeds of any such sale, transfer or foreclosure.

 

(c)           No
Obligations Regarding Certain Actions.  Administrative Agent shall have no obligation
whatsoever to any Lending Party or any other Person to assure that the
Collateral exists or is owned by Borrower or any other Loan Party or is cared
for, protected or insured or that the Liens granted to Administrative Agent
herein or in any of the Collateral Documents or pursuant hereto or thereto have
been properly or sufficiently or lawfully created, perfected, protected or
enforced or are entitled to any particular priority, or to exercise or to
continue exercising at all or in any manner or under any duty of care,
disclosure or fidelity any of the rights, authorities and powers granted or
available to Administrative Agent in this Section 9.11
or in any of the Collateral Documents, it being understood and agreed that in
respect of the Collateral, or any act, omission or event related thereto,
Administrative Agent may act in any manner it may deem appropriate, in its sole
discretion, given Administrative Agent’s own interest in the Collateral as one
of the Lenders, as Swing Line Lender and as L/C Issuer.

 

(d)           Appointment
of Lending Parties as Agents.  Each Lending Party hereby appoints each other
such Person as agent for the purpose of perfecting Administrative Agent’s or
such Person’s security interest in assets that, in accordance with
Article 9 or Division 9 (as applicable) of the Uniform Commercial
Code, can be perfected only by possession. 
Should any such Person (other than Administrative Agent) obtain
possession of any such Collateral, such Person shall notify Administrative
Agent thereof, and, promptly upon Administrative Agent’s request therefor,
shall deliver such Collateral to Administrative Agent or in accordance with
Administrative Agent’s instructions.

 

102

 

ARTICLE X

GENERAL PROVISIONS

 

SECTION 10.01       AMENDMENTS, ETC.

 

No
amendment or waiver of any provision of this Agreement or any other Loan
Document, and no consent to any departure by Borrower or any other Loan Party
therefrom, shall be effective unless in writing signed by Required Lenders (or
Administrative Agent at the written request of Required Lenders) and Borrower
or the applicable Loan Party, as the case may be, with receipt acknowledged by
Administrative Agent, and each such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given; provided that no such amendment, waiver or consent shall:

 

(a)           Matters
Involving Each Working Capital Lender.  Unless in writing and signed by Borrower,
with receipt acknowledged by Administrative Agent, do any of the following:

 

(i)            increase, or
extend the expiry of, the Working Capital Commitment of any Working Capital
Lender without the written consent of such Working Capital Lender, or increase
or extend the Swing Line Sublimit (or reinstate any such Commitment or the
Swing Line Sublimit to the extent terminated pursuant to Section 8.02)
without the written consent of all Working Capital Lenders; or

 

(ii)           postpone or
delay any date fixed by this Agreement or any other Loan Document for any
payment of principal, interest, fees or other amounts due to any Working
Capital Lender hereunder or under any other Loan Document, including any
prepayments specified under Section 2.05,  or reduce the amount due to any Working Capital Lender on
any such date, in each case without the written consent of such Working Capital
Lender; or

 

(iii)          reduce the principal
of, or the rate of interest or commitment fee specified herein on, any Working
Capital Loan or any Working Capital Commitment or other amounts payable to any
Working Capital Lender hereunder or under any other Loan Document, in each case
without the written consent of such Working Capital Lender; or

 

(iv)          amend any
provision herein providing for consent or other action by all Working Capital
Lenders, without the written consent of all Working Capital Lenders; or

 

(v)           amend the
definition of or “Working Capital Maturity Date”
contained in Section 1.01 without the
written consent of Working Capital Lenders holding in excess of 50% of the
Aggregate Working Capital Commitments, provided that the amended definition of “Working Capital Maturity Date” shall
not extend the Working Capital Commitment of any Working Capital Lender not
consenting to the amended definition; or

 

(vi)          amend the
definition of “Required Working Capital Lenders”
contained in Section 1.01 without the
written consent of all Working Capital Lenders; and

 

(b)           Matters
Involving Each Floorplan Lender.  Unless in writing and signed by Borrower,
with receipt acknowledged by Administrative Agent, do any of the following:

 

103

 

(i)            increase, or extend
the expiry of, the Floorplan Commitment of any Floorplan Lender (or reinstate
any such Commitment to the extent terminated pursuant to Section 8.02)
without the written consent of such Floorplan Lender; or

 

(ii)           postpone or
delay any date fixed by this Agreement or any other Loan Document for any
payment of principal, interest, fees or other amounts due to any Floorplan
Lender hereunder or under any other Loan Document, including any prepayments
and scheduled reductions specified under Sections 2.05, 2.06(b) and 2.06(c),  or reduce the amount due to any Floorplan Lender on any
such date, in each case without the written consent of such Floorplan Lender;
or

 

(iii)          reduce the
principal of, or the rate of interest or commitment fee specified herein on,
any Floorplan Loan or any Floorplan Commitment or other amounts payable to any
Floorplan Lender hereunder or under any other Loan Document, in each case
without the written consent of such Floorplan Lender; or

 

(iv)          amend any
provision herein providing for consent or other action by all Floorplan
Lenders, without the written consent of all Floorplan Lenders;

 

(v)           amend the
definition of “Floorplan Maturity Date”
contained in Section 1.01 without the
written consent of Floorplan Lenders holding in excess of 50% of the Aggregate
Floorplan Commitments, provided that the amended definition of “Floorplan Maturity Date” shall not
extend the Floorplan Commitment of any Floorplan Lender not consenting to the
amended definition; or

 

(v)           amend the
definition of “Required Floorplan Lenders”
contained in Section 1.01 without the
written consent of all Floorplan Lenders; and

 

(c)           Matters
Involving Required Working Capital Lenders. 
No such waiver, amendment or consent to any representation, warranty,
covenant, Event of Default or other provision of any Loan Document shall be
effective for purposes of Section 4.02 with
respect to the making of Working Capital Loans, Swing Line Loans or L/C Credit
Extensions after the Closing Date unless in writing and signed by Required
Working Capital Lenders and Borrower, with receipt acknowledged by
Administrative Agent;

 

(d)           Matters
Involving Required Floorplan Lenders.  No such waiver,
amendment or consent to any representation, warranty, covenant, Event of
Default or other provision of any Loan Document shall be effective for purposes
of Section 4.02 with respect to the
making of Floorplan Loans after the Closing Date unless in writing and signed
by Required Floorplan Lenders and Borrower, with receipt acknowledged by
Administrative Agent;

 

(e)           Matters
Involving Specific Lenders.  Unless in
writing and signed by Required Working Capital Lenders, Required Floorplan
Lenders and Borrower, with receipt acknowledged by Administrative Agent, amend
or waive any of the terms and provisions contained in Section 2.05,
it being understood that any waiver, amendment or consent to Section 2.05 shall also be subject to subsections (a) and
(b) of this Section 10.01, if applicable;

 

104

 

(f)            Matters
Involving All Lenders.  Unless in
writing and signed by all Lenders and Borrower, with receipt acknowledged by
Administrative Agent, do any of the following:

 

(i)            amend this Section 10.01, or Section 2.13,
or any provision herein providing for consent or other action by all Lenders;
or

 

(ii)           release all or
a substantial portion of the Collateral, except as otherwise expressly provided
herein or in any of the Collateral Documents, or amend the definition of the
obligations secured by any of the Collateral Documents; or

 

(iii)          except as
contemplated by Section 2.14, increase the
Aggregate Commitments;

 

(iv)          release or
terminate any of the Guaranties except as otherwise expressly provided herein
or in any of the Loan Documents;

 

(v)           amend the
definition of “Required Lenders” contained
in Section 1.01;

 

(vi)          amend the
definition of “Supermajority Floorplan Lenders”
contained in Section 1.01; or

 

(vii)         amend the
definition of “Supermajority Working Capital Lenders”
contained in Section 1.01;

 

(g)           Matters
Involving Supermajority Floorplan Lenders. 
Unless in writing and signed by Supermajority Floorplan Lenders and
Borrower, with receipt acknowledged by Administrative Agent, (i) increase
any advance rate set forth in the Floorplan Borrowing Base or (ii) amend
or waive any of the terms and provisions contained in Section 8.03;

 

(h)           Matters
Involving Supermajority Working Capital Lenders.  Unless in writing and signed
by Supermajority Working Capital Lenders and Borrower, with receipt
acknowledged by Administrative Agent, (i) increase any advance rate set
forth in the Working Capital Borrowing Base or (ii) amend or waive any of
the terms and provisions contained in Section 8.03;

 

provided  further that: 
(i) no amendment, waiver or consent shall, unless in writing and
signed by L/C Issuer in addition to such Lenders as are otherwise required
by this Section 10.01, affect the rights
or duties of L/C Issuer under this Agreement or any Issuer Document
relating to any Letter of Credit issued or to be issued by it; (ii) no
amendment, waiver or consent shall, unless in writing and signed by Swing Line
Lender in addition to such Lenders as are otherwise required by this Section 10.01, affect the rights or duties of Swing
Line Lender under this Agreement; (iii) no amendment, waiver or consent
shall, unless in writing and signed by Administrative Agent in addition to such
Lenders as are otherwise required by this Section 10.01,
affect the rights or duties of Administrative Agent under this Agreement or any
other Loan Document; (iv) the Fee Letter and the Fee Letter may be
amended, or rights or privileges thereunder waived, in a writing executed only
by the parties thereto; and Notwithstanding anything to the contrary herein, no
Lender who is at the time a Defaulting Lender shall have any right to approve
or disapprove any amendment, waiver or consent hereunder, except that the
Commitment of such Lender may not be increased or extended without the consent
of such Lender.

 

105

 

 

 

SECTION 10.02       NOTICES; EFFECTIVENESS;
ELECTRONIC COMMUNICATIONS.

 

(a)           Notices
Generally.  Except in
the case of notices and other communications expressly permitted to be given by
telephone (and except as provided in Section 10.02(b)),
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, sent by telefacsimile transmission or sent by
approved electronic communication in accordance with Section 10.02(b),
and all notices and other communications expressly permitted to be given by
telephone shall be made to the applicable telephone number, as follows:

 

(i)            if to Borrower,
any Guarantor, Administrative Agent, L/C Issuer or Swing Line Lender, to
the address, telefacsimile number, e-mail address or telephone number specified
for such Person on Schedule 10.02;
and

 

(ii)           if to any
Lender, to the address, telefacsimile number, e-mail address or telephone
number specified in its Administrative Detail Form.

 

Notices
sent by hand or overnight courier service, or mailed by certified or registered
mail, shall be deemed to have been given when received, and notices sent by
telefacsimile transmission or by means of approved electronic communication
shall be deemed to have been given when sent (except that, if not given during
normal business hours for the recipient, shall be deemed to have been given at
the opening of business on the next business day for the recipient); provided that notices delivered through electronic
communications to the extent provided by Section 10.02(b) shall
be effective as provided in such subsection (b).

 

(b)           Electronic
Communications.

 

(i)            Each Lending
Party agrees that notices and other communications to it hereunder may be delivered
or furnished by electronic communication (including e-mail and Internet or
intranet websites) pursuant to procedures approved by Administrative Agent; provided that the foregoing shall not apply to notices to
any Lending Party pursuant to Article II
if such Lending Party has notified Administrative Agent that it is incapable of
receiving notices under Article II
by electronic communication; provided further
that, as of the date hereof, each Lending Party who is a party hereto confirms
that it is capable of receiving notices under Article II
by electronic communication.  In
furtherance of the foregoing, each Lending Party hereby agrees to notify
Administrative Agent in writing, on or before the date such Lending Party
becomes a party to this Agreement, of such Lending Party’s e-mail address to
which a notice may be sent (and from time to time thereafter to ensure that
Administrative Agent has on record an effective e-mail address for such Lending
Party).  Each of Administrative Agent and
Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by means of electronic communication pursuant to
procedures approved by it; provided that
approval of such procedures may be limited to particular notices or
communications.

 

Unless Administrative Agent otherwise prescribes:  (A) notices and other communications
sent to an e-mail address shall be deemed received upon the sender’s receipt of
an acknowledgement from the intended recipient (such as by the “return receipt
requested” 

 

106

 

function,
as available, return e-mail or other written acknowledgement); provided that, if such notice or other communication is not
sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on
the next business day for the recipient; and (B) notices or communications
posted to an Internet or intranet website shall be deemed received upon the
deemed receipt by the intended recipient at its e-mail address as described in
the foregoing clause (A) of notification that such notice or
communication is available and identifying the website address therefor.

 

(ii)           Borrower hereby
acknowledges that:  (A) Administrative
Agent may make available to Lending Parties Specified Materials by posting some
or all of the Specified Materials on an Electronic Platform; (B) the
distribution of materials and information through an electronic medium is not
necessarily secure and that there are confidentiality and other risks
associated with any such distribution, the Electronic Platform is provided and
used on an “AS IS,” “AS AVAILABLE” basis; and (C) neither Administrative
Agent nor any of its Affiliates warrants the accuracy, completeness,
timeliness, sufficiency or sequencing of the Specified Materials posted on the
Electronic Platform.  ADMINISTRATIVE
AGENT, ON BEHALF OF ITSELF AND ITS AFFILIATES, EXPRESSLY AND SPECIFICALLY
DISCLAIMS, WITH RESPECT TO THE ELECTRONIC PLATFORM, DELAYS IN POSTING OR
DELIVERY, OR PROBLEMS ACCESSING THE SPECIFIED MATERIALS POSTED ON THE
ELECTRONIC PLATFORM, AND ANY LIABILITY FOR ANY LOSSES, COSTS, EXPENSES OR
LIABILITIES THAT MAY BE SUFFERED OR INCURRED IN CONNECTION WITH THE
ELECTRONIC PLATFORM.  NO WARRANTY OF ANY
KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSES, NON-INFRINGEMENT OF THIRD
PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY
ADMINISTRATIVE AGENT OR ANY OF ITS AFFILIATES IN CONNECTION WITH THE ELECTRONIC
PLATFORM.

 

Each Lending Party hereby agrees that notice to it in accordance with Section 10.02(b)(i) specifying that any Specified
Materials have been posted to the Electronic Platform shall, for purposes of
this Agreement, constitute effective delivery to such Lending Party of such
Specified Materials.

 

EACH LENDING PARTY: 
(1) ACKNOWLEDGES THAT THE SPECIFIED MATERIALS, INCLUDING
INFORMATION FURNISHED TO IT BY ANY LOAN PARTY OR ADMINISTRATIVE AGENT PURSUANT
TO, OR IN THE COURSE OF ADMINISTERING, THE LOAN DOCUMENTS, MAY INCLUDE
MATERIAL, NON-PUBLIC INFORMATION CONCERNING THE LOAN PARTIES AND THEIR
RESPECTIVE SUBSIDIARIES OR AFFILIATES OR THEIR RESPECTIVE SECURITIES; AND
(2) CONFIRMS THAT:  (I) IT HAS
DEVELOPED COMPLIANCE PROCEDURES REGARDING THE USE OF MATERIAL, NON-PUBLIC
INFORMATION; (II) IT WILL HANDLE SUCH MATERIAL, NON-PUBLIC INFORMATION IN
ACCORDANCE WITH SUCH PROCEDURES AND APPLICABLE LAWS, INCLUDE FEDERAL AND
STATE SECURITIES LAWS; AND (III) IT HAS IDENTIFIED IN ITS ADMINISTRATIVE
DETAIL FORM A CONTACT PERSON WHO MAY RECEIVE SPECIFIED MATERIALS THAT
MAY CONTAIN MATERIAL, NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS
COMPLIANCE PROCEDURES AND APPLICABLE LAWS.

 

(c)           Change
of Address, Etc. 
Borrower, Administrative Agent, Swing Line Lender and L/C Issuer
may change their respective address(es), telefacsimile number(s), telephone
number(s) or 

 

107

 

e-mail
address(es) for notices and other communications hereunder by notice to the
other parties hereto.  Each Lender may
change its address(es), telefacsimile number(s), telephone number(s) or
e-mail address(es) for notices and other communications hereunder by notice to
Borrower, Administrative Agent, Swing Line Lender and L/C Issuer.

 

(d)           Reliance
by Administrative Agent and Lending Parties.  Administrative Agent and Lending Parties
shall be entitled to rely and act upon any notices (including telephonic or
electronically delivered Requests for Credit Extension) purportedly given by or
on behalf of Borrower even if: 
(i) such notices were not made in a manner specified herein, were
incomplete or were not preceded or followed by any other form of notice
specified herein; or (ii) the terms thereof, as understood by the
recipient, varied from any confirmation thereof.  Borrower shall indemnify Administrative Agent
and each Lending Party and their respective Related Parties from all losses,
costs, expenses and liabilities resulting from the reliance by such Person on
each notice purportedly given by or on behalf of Borrower.  All telephonic notices to and other
telephonic communications with Administrative Agent may be recorded by
Administrative Agent, and each of the parties hereto hereby consents to such
recording.

 

SECTION 10.03       NO WAIVER; CUMULATIVE REMEDIES.

 

No
failure by Administrative Agent or any Lending Party to exercise, and no delay
by any such Person in exercising, any right, remedy, power or privilege
hereunder shall operate as a waiver thereof; no single or partial exercise of
any right, remedy, power or privilege hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, remedy, power or
privilege.  The rights, remedies, powers and
privileges herein provided are cumulative and not exclusive of any rights,
remedies, powers and privileges provided by law.

 

SECTION 10.04       EXPENSES; INDEMNITY; DAMAGE
WAIVER.

 

(a)           Costs
and Expenses.  Borrower
shall pay:  (i) all reasonable
out-of-pocket expenses incurred by Administrative Agent, Arranger and their
respective Affiliates (including the reasonable fees, charges and disbursements
of counsel for Administrative Agent), in connection with the syndication of the
credit facilities provided for herein, the preparation, negotiation, execution,
delivery and administration of this Agreement and 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
L/C Issuer in connection with the issuance, amendment, renewal or
extension of any Letter of Credit or any demand for payment thereunder; and
(iii) all out-of-pocket expenses incurred by Administrative Agent or any
Lending Party (including the fees, charges and disbursements of any counsel for
Administrative Agent or any Lending Party), and shall pay all fees and time
charges for attorneys, who may be employees of Administrative Agent or any
Lending Party, in connection with the enforcement or protection of its
rights:  (A) in connection with this
Agreement and the other Loan Documents, including its rights under this Section 10.04; or (B) in connection with the Loans
made or Letters of Credit issued hereunder, including all such out-of-pocket
expenses incurred during any workout or restructuring (or negotiations in
connection with the foregoing) in respect of such Loans or Letters of Credit.

 

108

 

(b)           Indemnification
by Borrower.  Borrower
shall indemnify each Indemnitee against, and hold each Indemnitee harmless
from, any and all losses, claims, damages, liabilities and related expenses
(including the fees, charges and disbursements of any counsel for any Indemnitee),
and shall indemnify and hold harmless each Indemnitee from all fees and time
charges and disbursements for attorneys, who may be employees of any
Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee by
any third party or by Borrower or any other Loan Party arising out of, in
connection with, or as a result of: 
(i) the execution or delivery of this Agreement, any other Loan
Document or any document contemplated hereby or thereby, the performance by the
parties hereto of their respective obligations hereunder or thereunder or the
consummation of the transactions contemplated hereby or thereby; (ii) any
Loan or Letter of Credit or the use or proposed use of the proceeds therefrom
(including any refusal by L/C Issuer 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); (iii) any
actual or alleged presence or release of Hazardous Materials on or from any property
owned or operated by Borrower, any Subsidiary thereof or any other Loan Party,
or any Environmental Claim or Environmental Liability related in any way to
Borrower, any Subsidiary thereof or any other Loan Party; or (iv) any
actual or prospective claim, litigation, investigation or proceeding relating
to any of the foregoing, whether based on contract, tort or any other theory,
whether brought by a third party or by Borrower, any Subsidiary thereof or any
other Loan Party, and regardless of whether any Indemnitee is a party thereto,
in all cases, whether or not caused by or arising, in whole or in part, out of
the comparative, contributory or sole negligence of the Indemnitee; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses result from the gross negligence or willful
misconduct of such Indemnitee.

 

(c)           Reimbursement
by Lenders.  If Borrower
for any reason fails to pay when due any amount that it is required to pay
under Section 10.04(a) or Section 10.04(b) to Administrative Agent (or any
sub-agent thereof), Swing Line Lender, L/C Issuer or any Related Party of
any of the foregoing, each Lender severally agrees to pay to Administrative
Agent (or any such sub-agent), Swing Line Lender, L/C Issuer or such
Related Party, as the case may be, such Lender’s pro rata share (based on its
Percentage Shares (determined as of the time that the applicable unreimbursed
expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss,
claim, damage, liability or related expense, as the case may be, was incurred
by or asserted against Administrative Agent (or any such sub-agent), Swing Line
Lender, L/C Issuer or any Related Party of any of the foregoing acting for
Administrative Agent (or any such sub-agent), Swing Line Lender or
L/C Issuer in connection with such capacity.  The obligations of Lenders under this
subsection (c) are subject to the provisions of Section 2.12(d).

 

(d)           Waiver
of Consequential Damages, Etc.  To the fullest extent permitted by applicable
law, each Loan Party shall not assert, and 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 Document or
any document contemplated hereby, the transactions contemplated hereby or
thereby, any Loan or Letter of Credit or the use of the proceeds thereof.  No Indemnitee referred to in Section 10.04(b) shall be liable for any damages
arising from the use by unintended recipients of any information or other
materials distributed by it through telecommunications, electronic or other
information transmission systems in connection with this Agreement or the other
Loan Documents or the transactions contemplated hereby or thereby.

 

109

 

(e)           Payments.  All amounts due under this Section 10.04  shall be
payable not later than three Business Days after demand therefor.

 

(f)            Survival.  The agreements in this Section 10.04 shall survive the resignation of Administrative Agent,
Swing Line Lender and L/C Issuer, the replacement of any Lender, the
termination of the Aggregate Commitments and the repayment, satisfaction or
discharge of all other Obligations.

 

SECTION 10.05       MARSHALLING; PAYMENTS SET ASIDE.

 

Neither
Administrative Agent nor any other Lending Party shall be under any obligation
to marshal any asset in favor of Borrower or any other Person or against or in
payment of any or all of the Obligations. 
To the extent that any payment by or on behalf of Borrower is made to
Administrative Agent or any Lending Party, or Administrative Agent or any
Lending Party exercises its right of setoff, and such payment or the proceeds
of such setoff or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by Administrative Agent or any Lending Party in such
Person’s discretion) to be repaid to a trustee, receiver or any other party, in
connection with any proceeding under any Bankruptcy Law or otherwise,
then:  (a) to the extent of such
recovery, the obligation or part thereof originally intended to be satisfied
shall be revived and continued in full force and effect as if such payment had
not been made or such setoff had not occurred; and (b) each Lending Party
severally agrees to pay to Administrative Agent upon demand its applicable
share (without duplication) of any amount so recovered from or repaid by
Administrative Agent plus interest
thereon from the date of such demand to the date such payment is made at a rate
per annum equal to the Federal Funds Rate. 
The obligations of each Lending Party under clause (b) of the
preceding sentence shall survive the payment in full of the Obligations and the
termination of this Agreement.

 

SECTION 10.06       SUCCESSORS AND ASSIGNS.

 

(a)           Successors
and Assigns Generally.  The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted
hereby, except that neither Borrower nor any other Loan Party may assign or
otherwise transfer any of its rights or obligations hereunder without the prior
written consent of Administrative Agent and each Lending Party, and neither
Swing Line Lender nor any Lender may assign or otherwise transfer any of its
rights or obligations hereunder except: 
(i) to an Eligible Assignee in accordance with the provisions of
subsection (b) of this Section 10.06;
(ii) by way of participation in accordance with the provisions of
subsection (d) of this Section 10.06;
or (iii) by way of pledge or assignment of a security interest subject to
the restrictions of subsection (f) of this Section 10.06
(and any other attempted assignment or transfer by any party hereto
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, Participants to the extent provided in subsection (d) of
this Section 10.06 and, to the extent
expressly contemplated hereby, the Related Parties of each of Administrative
Agent and each Lending Party) any legal or equitable right, remedy or claim
under or by reason of this Agreement.

 

(b)           Assignments
by Swing Line Lender or any Lender.  Swing Line Lender or any Lender may at any
time assign to one or more Eligible Assignees all or a portion of its rights
and obligations 

 

110

 

under
this Agreement (including all or a portion of its Commitment(s) and the
Loans (including for purposes of this subsection (b), participations in
L/C Obligations and in Swing Line Loans, as applicable) at the time owing
to it); provided that (i) except in the
case of an assignment of the entire remaining amount of the assigning Lender’s
Commitment(s) and Loans at the time owing to it or in the case of an
assignment to a Lender or an Affiliate of a Lender, the aggregate amount of the
Commitment(s) (which for this purpose includes Loans outstanding
thereunder) or, if any Commitment is not then in effect, the Outstanding Amount
of the Loans of the assigning Swing Line Lender or Lender subject to each such
assignment, determined as of the date the Assignment and Assumption with
respect to such assignment is delivered to Administrative Agent or, if a “trade
date” is specified in the Assignment and Assumption, as of such trade date,
shall not be less than $5,000,000.00 unless each of Administrative Agent and,
so long as no Event of Default has occurred and is continuing, Borrower
otherwise consents (each such consent not to be unreasonably withheld or
delayed); (ii) each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender’s rights and obligations under
this Agreement with respect to the Loans or the Commitment assigned, except
that this clause (ii) shall not apply to rights in respect of Swing
Line Loans; (iii) any assignment of a Commitment must be approved by
Administrative Agent, L/C Issuer and Swing Line Lender, unless the Person
that is the proposed assignee is itself a Lender (whether or not the proposed
assignee would otherwise qualify as an Eligible Assignee); (iv) the
Eligible Assignee, if it is not then a Lender, shall deliver to Administrative
Agent an Administrative Detail Form; and (v) the parties to each assignment
shall execute and deliver to Administrative Agent an Assignment and Assumption,
together with a processing and recordation fee of $3,500.00; provided that Administrative Agent hereby waives such
processing and recordation fee in connection with any assignment effected
pursuant to Section 3.07(a); and
(vi) so long as an Event of Default does not then exist, any assignment
shall require the prior written consent of Borrower (which shall not be
unreasonably withheld or delayed) unless the Person that is the proposed
assignee is an Eligible Assignee. 
Subject to acceptance and recording thereof by Administrative Agent
pursuant to subsection (c) of this Section 10.06,
from and after the effective date specified in each Assignment and Assumption,
the Eligible Assignee thereunder shall be a party to this Agreement and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of Swing Line Lender or a Lender, as applicable, under
this Agreement, and the assigning Swing Line Lender or Lender, as applicable,
thereunder shall, to the extent of the interest assigned by such Assignment and
Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lending
Party’ rights and obligations under this Agreement, such Lending Party shall
cease to be a party hereto) but shall continue to be entitled to the benefits
of Section 3.01, Section 3.04,
Section 3.05 and Section 10.04 with respect to facts and circumstances
occurring prior to the effective date of such assignment.  Upon request, Borrower (at its expense) shall
execute and deliver Notes to the assignee Lending Party.  Any assignment or transfer by Swing Line
Lender or a Lender of rights or obligations under this Agreement that does not
comply with this subsection shall be treated for purposes of this Agreement as
a sale by such Lending Party of a participation in such rights and obligations
in accordance with subsection (d) of this Section 10.06.

 

(c)           Register.  Administrative Agent, acting solely for this
purpose as an agent of Borrower, shall maintain at the Administrative Agent’s
Office a copy of each Assignment and Assumption delivered to it and a
Register.  The entries in the Register
shall be conclusive, and Borrower, Administrative Agent and Lending Parties 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 each of Borrower,
Swing Line 

 

111

 

Lender
and L/C Issuer, at any reasonable time and from time to time upon
reasonable prior notice.  In addition, at
any time that a request for a consent for a material or substantive change to
the Loan Documents is pending, any Lender wishing to consult with other Lenders
in connection therewith may request and receive from Administrative Agent a
copy of the Register.

 

(d)           Participations.  Swing Line Lender or any Lender may at any
time, without the consent of, or notice to, Borrower or Administrative Agent,
sell participations to any Participant in all or a portion of such Person’s
rights and/or obligations under this Agreement (including all or a portion of
its Commitment(s) and/or the Loans (including such Lender’s participations
in L/C Obligations and/or Swing Line Loans) owing to it); provided that: 
(i) such Person’s obligations under this Agreement shall remain
unchanged; (ii) such Person shall remain solely responsible to the other
parties hereto for the performance of such obligations; and
(iii) Borrower, Administrative Agent and Lending Parties shall continue to
deal solely and directly with such Person in connection with such Person’s
rights and obligations under this Agreement. 
Any document pursuant to which Swing Line Lender or a Lender sells such
a participation shall provide that such Person shall retain the sole right to
enforce this Agreement and the other Loan Documents and to approve any
amendment, modification or waiver of any provision of this Agreement and the
other Loan Documents; provided that
such document may provide that such Person will not, without the consent of the
Participant, agree to any amendment, waiver or other modification described in
the first proviso to Section 10.01
that affects such Participant.  Subject
to subsection (e) of this Section 10.06,
Borrower agrees that each Participant shall be entitled to the benefits of Section 3.01, Section 3.04
and Section 3.05 to the same extent as
if it were a Lending Party hereunder and had acquired its interest by
assignment pursuant to subsection (b) of this Section 10.06.  To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 10.08
as though it were a Lending Party, as long as such Participant agrees to be
subject to Section 2.13 as though it
were a Lending Party.

 

(e)           Limitations
upon Participant Rights.  A
Participant shall not be entitled to receive any greater payment under Section 3.01 or Section 3.04
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 Borrower’s prior written
consent.

 

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

 

(g)           Electronic
Execution of Assignments.  The
words “execution,” “signed,” “signature,”
and words of like import in any Assignment and Assumption shall be deemed to
include electronic signatures or the keeping of records in electronic form,
each of which shall be of the same legal effect, validity or enforceability as
a manually executed signature or the use of a paper-based recordkeeping system,
as the case may be, to the extent and as provided for in any applicable Law,
including the Federal Electronic Signatures in Global and National Commerce
Act, the New York State Electronic Signatures and Records Act, or any other
similar state laws based on the Uniform Electronic Transactions Act.

 

112

 

(h)           Resignation
as L/C Issuer or Swing Line Lender.  Notwithstanding anything to the contrary
contained herein, if at any time Wells Fargo assigns all of its Commitments and
Loans pursuant to subsection (b) of this Section 10.06,
Wells Fargo may do either or both of the following:  (i) upon thirty days’ notice to Borrower
and all Lenders, resign as L/C Issuer; or (ii) upon thirty days’
notice to Borrower, resign as Swing Line Lender.  In the event of any such resignation as
L/C Issuer or Swing Line Lender, Borrower shall be entitled to appoint
from among Lenders a successor L/C Issuer or Swing Line Lender; provided that no failure by Borrower to appoint any such
successor shall affect the resignation of Wells Fargo as L/C Issuer or
Swing Line Lender, as the case may be. 
If Wells Fargo resigns as L/C Issuer, it shall retain all the
rights and obligations of L/C Issuer hereunder with respect to all Letters
of Credit outstanding as of the effective date of its resignation as
L/C Issuer and all L/C Obligations with respect thereto (including
the right to require Lenders to make Working Capital Loans that are Base Rate
Revolving Loans or fund risk participations in Unreimbursed Amounts pursuant to
Section 2.03(c)).  If Wells Fargo resigns as Swing Line Lender,
it shall retain all the rights of Swing Line Lender provided for hereunder with
respect to Swing Line Loans made by it and outstanding as of the effective date
of such resignation, including the right to require Lenders to make Working
Capital Loans that are Base Rate Loans or fund risk participations in
outstanding Swing Line Loans pursuant to Section 2.04(c).

 

SECTION 10.07       TREATMENT OF CERTAIN INFORMATION;
CONFIDENTIALITY.

 

Administrative
Agent and each Lending Party each agrees to maintain the confidentiality of the
Information, except that Information may be disclosed:  (a) to its Affiliates and to its and its
Affiliates’ respective partners, directors, officers, employees, agents,
advisors and representatives (it being understood that the Persons to whom such
disclosure is made will be informed of the confidential nature of such
Information and agree to keep such Information confidential on the same terms
as provided herein); (b) to the extent requested by any regulatory
authority, purporting to have jurisdiction over it (including any
self-regulatory authority, such as the National Association of Insurance
Commissioners); (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process; (d) to any other
party hereto; (e) in connection with the exercise of any remedies
hereunder or under any other Loan Document or any action or proceeding relating
to this Agreement or any other Loan Document or the enforcement of rights
hereunder or thereunder; (f) to Gold Sheets and other similar bank
trade publications, such information to consist of deal terms and other
information customarily found in such publications, (g) unless an Event of
Default has occurred and is continuing, subject to an agreement containing
provisions substantially the same as those of this Section 10.07
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 any Loan Party; (h) with the consent of Borrower;
or (i) to the extent such Information: 
(i) becomes publicly available other than as a result of a breach
of this Section 10.07; or
(ii) becomes available to Administrative Agent, any Lending Party or any
of their respective Affiliates on a non-confidential basis from a source other
than Borrower or any Subsidiary thereof and not in contravention of this Section 10.07. 
For purposes of this Section 10.07,
“Information” means all information
(including financial information) received from Borrower or any Subsidiaries
thereof relating to Borrower or any Subsidiary thereof or any of their
respective businesses, other than any such information that is available to Administrative
Agent or any Lending Party on a nonconfidential basis, and not in contravention
of this Section 10.07, prior to disclosure
by Borrower or any Subsidiary thereof. 
Any Person required to maintain the confidentiality of Information as
provided in this Section 10.07:  (A) shall be considered to have complied
with its obligation to do so if such Person has exercised the 

 

113

 

same
degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information; and (B) shall not
disclose any financial information concerning Borrower, any Subsidiary thereof
or their respective businesses (including any information based on any such
financial information) or use any such financial information for commercial
purposes without the prior written consent of Borrower.

 

SECTION 10.08       RIGHT OF SETOFF.

 

If
an Event of Default shall have occurred and be continuing, each of Lending
Parties and their respective Affiliates is hereby authorized at any time and
from time to time, to the fullest extent permitted by applicable law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final, in whatever currency) at any time held and other
obligations (in whatever currency) at any time owing by such Lending Party to
or for the credit or the account of Borrower or any other Loan Party against
any and all of the Obligations to such Lending Party or such Affiliate,
irrespective of whether or not such Lending Party shall have made any demand
under this Agreement or any other Loan Document and although such obligations
of Borrower or such Loan Party may be contingent or unmatured or are owed to a
branch or office of such Lending Party different from the branch or office
holding such deposit or obligated on such obligations.  The rights of each Lending Party and its
Affiliates under this Section 10.08 are
in addition to other rights and remedies (including other rights of setoff)
that such Lending Party or its Affiliates may have.  Each Lending Party agrees to notify Borrower
and Administrative Agent promptly after any such setoff and application; provided that the failure to give such notice shall not
affect the validity of such setoff and application.  NOTWITHSTANDING THE FOREGOING, NO LENDING
PARTY SHALL EXERCISE, OR ATTEMPT TO EXERCISE, ANY RIGHT OF SET-OFF, BANKER’S
LIEN, OR THE LIKE, AGAINST ANY DEPOSIT ACCOUNT OR PROPERTY OF BORROWER OR ANY
SUBSIDIARY THEREOF HELD OR MAINTAINED BY SUCH LENDING PARTY WITHOUT THE PRIOR
WRITTEN CONSENT OF ADMINISTRATIVE AGENT.

 

SECTION 10.09       INTEREST RATE LIMITATION.

 

Notwithstanding
anything to the contrary contained in any Loan Document, the interest paid or
agreed to be paid under the Loan Documents shall not exceed the Maximum
Rate.  If Administrative Agent or any
Lender shall receive interest in an amount that exceeds the Maximum Rate, the
excess interest shall be applied to the principal of the Loans or, if it exceeds
such unpaid principal, refunded to Borrower. 
In determining whether the interest contracted for, charged, or received
by Administrative Agent or a Lender exceeds the Maximum Rate, such Person may,
to the extent permitted by applicable Law: 
(a) characterize any payment that is not principal as an expense,
fee, or premium rather than interest; (b) exclude voluntary prepayments
and the effects thereof; and (c) amortize, prorate, allocate, and spread
in equal or unequal parts the total amount of interest throughout the
contemplated term of the Obligations hereunder.

 

SECTION 10.10       COUNTERPARTS; INTEGRATION;
EFFECTIVENESS.

 

This
Agreement may be executed in counterparts (and by different parties hereto in
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract.  This Agreement and the other Loan Documents
constitute the entire 

 

114

 

agreement
among the parties relating to the subject matter hereof and supersede any and
all previous documents, 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 and
delivered by Administrative Agent and when Administrative Agent shall have
received counterparts hereof that, when taken together, bear the signatures of
each of the other parties hereto. 
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 10.11       SURVIVAL OF REPRESENTATIONS AND
WARRANTIES.

 

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

 

SECTION 10.12       SEVERABILITY.

 

If
any provision of this Agreement or the other Loan Documents is held to be
illegal, invalid or unenforceable, (a) the legality, validity and
enforceability of the remaining provisions of this Agreement and the other Loan
Documents shall not be affected or impaired thereby and (b) the parties
shall endeavor in good faith negotiations to replace the illegal, invalid or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the illegal, invalid or unenforceable
provisions.  The invalidity of a
provision in a particular jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

 

SECTION 10.13       USA PATRIOT ACT NOTICE.

 

Each
Lending Party that is subject to the Act and Administrative Agent (for itself
and not on behalf of any Lending Party) hereby notify Borrower that, pursuant
to the requirements of the Act, they are each required to obtain, verify and
record information that identifies Borrower and each other Loan Party, which
information includes the name and address of Borrower and each other Loan Party
and other information that will allow such Lending Party or Administrative
Agent, as applicable, to identify Borrower and each other Loan Party in
accordance with the Act.

 

SECTION 10.14       GUARANTY BY SUBSIDIARIES.

 

(a)           Guaranty.  Each Subsidiary of Borrower party hereto
(each, a “Subsidiary Guarantor”)
unconditionally and irrevocably guarantees to Administrative Agent and Lending
Parties the full and prompt payment when due (whether at stated maturity, by
required prepayment, declaration, acceleration, demand or otherwise) and
performance of  the Obligations (the “Guaranteed Obligations”).  The

 

115

 

 

 

Guaranteed
Obligations include interest that, but for a proceeding under any Bankruptcy
Law, would have accrued on such Guaranteed Obligations, whether or not a claim
is allowed against Borrower for such interest in any such proceeding.

 

(b)           Separate
Obligation.  Each
Subsidiary Guarantor acknowledges and agrees that:  (i) the Guaranteed Obligations are
separate and distinct from any Debt arising under or in connection with any other
document, including under any provision of this Agreement other than this Section 10.14, executed at any time by such Subsidiary
Guarantor in favor of Administrative Agent or any Lending Party; and
(ii) such Subsidiary Guarantor shall pay and perform all of the Guaranteed
Obligations as required under this Section 10.14,
and Administrative Agent and Lending Parties may enforce any and all of their
respective rights and remedies hereunder, without regard to any other document,
including any provision of this Agreement other than this Section 10.14,
at any time executed by such Subsidiary Guarantor in favor of Administrative
Agent or any Lending Party, irrespective of whether any such other document, or
any provision thereof or hereof, shall for any reason become unenforceable or
any of the Debt thereunder shall have been discharged, whether by performance,
avoidance or otherwise.  Each Subsidiary
Guarantor acknowledges that, in providing benefits to Borrower, Administrative
Agent and Lending Parties are relying upon the enforceability of this Section 10.14 and the Guaranteed Obligations as
separate and distinct Debt of such Subsidiary Guarantor, and each Subsidiary
Guarantor agrees that Administrative Agent and Lending Parties would be denied
the full benefit of their bargain if at any time this Section 10.14
or the Guaranteed Obligations were treated any differently.  The fact that the guaranty is set forth in
this Agreement rather than in a separate guaranty document is for the
convenience of Borrower and Subsidiary Guarantors and shall in no way impair or
adversely affect the rights or benefits of Administrative Agent and Lending
Parties under this Section 10.14.  Each Subsidiary Guarantor agrees to execute
and deliver a separate document, immediately upon request at any time of
Administrative Agent or any Lending Party, evidencing such Subsidiary Guarantor’s
obligations under this Section 10.14.  Upon the occurrence of any Event of Default,
a separate action or actions may be brought against such Subsidiary Guarantor,
whether or not Borrower, any other Subsidiary Guarantor or any other Person is
joined therein or a separate action or actions are brought against Borrower,
any such other Subsidiary Guarantor or any such other Person.

 

(c)           Limitation
of Guaranty.  To the
extent that any court of competent jurisdiction shall impose by final judgment
under applicable law (including the Uniform Fraudulent Transfer Act and
Sections 544 and 548 of the Bankruptcy Code) any limitations on the amount
of any Subsidiary Guarantor’s liability with respect to the Guaranteed
Obligations that Administrative Agent or any Lending Party can enforce under
this Section 10.14, Administrative
Agent and Lending Parties by their acceptance hereof accept such limitation on
the amount of such Subsidiary Guarantor’s liability hereunder to the extent
needed to make this Section 10.14
fully enforceable and nonavoidable.

 

(d)           Liability
of Subsidiary Guarantors.  The
liability of any Subsidiary Guarantor under this Section 10.14
shall be irrevocable, absolute, independent and unconditional, and shall not be
affected by any circumstance that might constitute a discharge of a surety or
guarantor other than the indefeasible payment and performance in full of all
Guaranteed Obligations.  In furtherance
of the foregoing and without limiting the generality thereof, each Subsidiary
Guarantor agrees as follows:

 

(i)            such Subsidiary
Guarantor’s liability hereunder shall be the immediate, direct, and primary
obligation of such Subsidiary Guarantor and shall not be contingent upon 

 

116

 

Administrative
Agent’s or any Lending Party’s exercise or enforcement of any remedy it may
have against Borrower or any other Person, or against any collateral or other
security for any Guaranteed Obligations;

 

(ii)           this Guaranty
is a guaranty of payment when due and not merely of collectibility;

 

(iii)          Administrative
Agent and Lending Parties may enforce this Section 10.14
upon the occurrence of an Event of Default notwithstanding the existence of any
dispute among Administrative Agent and Lending Parties, on the one hand, and
Borrower or any other Person, on the other hand, with respect to the existence
of such Event of Default;

 

(iv)          such Subsidiary
Guarantor’s payment of a portion, but not all, of the Guaranteed Obligations
shall in no way limit, affect, modify or abridge such Subsidiary Guarantor’s
liability for any portion of the Guaranteed Obligations remaining unsatisfied;
and

 

(v)           such Subsidiary
Guarantor’s liability with respect to the Guaranteed Obligations shall remain
in full force and effect without regard to, and shall not be impaired or
affected by, nor shall such Subsidiary Guarantor be exonerated or discharged
by, any of the following events:

 

(A)          any proceeding under any Bankruptcy Law;

 

(B)          any limitation, discharge, or cessation of the
liability of Borrower or any other Person for any Guaranteed Obligations due to
any statute, regulation or rule of law, or any invalidity or
unenforceability in whole or in part of any of the Guaranteed Obligations or
the Loan Documents;

 

(C)          any merger, acquisition, consolidation or change in
structure of any Company or any other guarantor or Person, or any sale, lease,
transfer or other disposition of any or all of the assets or shares of Borrower
or any other Person;

 

(D)          any assignment or other transfer, in whole or in
part, of Administrative Agent’s or any Lending Party’s interests in and rights
under this Agreement (including this Section 10.14)  or the other Loan Documents;

 

(E)           any claim, defense, counterclaim or setoff, other
than that of prior performance, that Borrower, such Subsidiary Guarantor, any
other Guarantor or any other Person may have or assert, including any defense
of incapacity or lack of corporate or other authority to execute any of the
Loan Documents;

 

(F)           Administrative Agent’s or any Lending Party’s
amendment, modification, renewal, extension, cancellation or surrender of any
Loan Document or any Guaranteed Obligations;

 

(G)          Administrative Agent’s or any Lending Party’s
exercise or non-exercise of any power, right or remedy with respect to any
Guaranteed Obligations or any collateral;

 

117

 

(H)          Administrative Agent’s or any Lending Party’s vote,
claim, distribution, election, acceptance, action or inaction in any proceeding
under any Bankruptcy Law; or

 

(I)            any other guaranty, whether by such Subsidiary
Guarantor or any other Person, of all or any part of the Guaranteed Obligations
or any other indebtedness, obligations or liabilities of Borrower to
Administrative Agent or any Lending Party.

 

(e)           Consents
of Subsidiary Guarantors.  Each
Subsidiary Guarantor hereby unconditionally consents and agrees that, without
notice to or further assent from such Subsidiary Guarantor:

 

(i)            the principal
amount of the Guaranteed Obligations may be increased or decreased and
additional indebtedness or obligations of Borrower under the Loan Documents may
be incurred and the time, manner, place or terms of any payment under any Loan
Document may be extended or changed, by one or more amendments, modifications,
renewals or extensions of any Loan Document or otherwise;

 

(ii)           the time for
Borrower’s (or any other Person’s) performance of or compliance with any term,
covenant or agreement on its part to be performed or observed under any Loan
Document may be extended, or such performance or compliance waived, or failure
in or departure from such performance or compliance consented to, all in such
manner and upon such terms as Administrative Agent and Lending Parties (as
applicable under the relevant Loan Documents) may deem proper;

 

(iii)          Administrative
Agent and Lending Parties may request and accept other guaranties and may take
and hold security as collateral for the Guaranteed Obligations, and may, from
time to time, in whole or in part, exchange, sell, surrender, release,
subordinate, modify, waive, rescind, compromise or extend such other guaranties
or security and may permit or consent to any such action or the result of any
such action, and may apply such security and direct the order or manner of sale
thereof; and

 

(iv)          Administrative
Agent or Lending Parties may exercise, or waive or otherwise refrain from
exercising, any other right, remedy, power or privilege even if the exercise
thereof affects or eliminates any right of subrogation or any other right of
such Subsidiary Guarantor against Borrower.

 

(f)            Subsidiary
Guarantor’s Waivers.  Each
Subsidiary Guarantor waives and agrees not to assert:

 

(i)            any right to
require Administrative Agent or any Lending Party to proceed against Borrower,
any other Guarantor or any other Person, or to pursue any other right, remedy,
power or privilege of Administrative Agent or any Lending Party whatsoever;

 

(ii)           the defense of
the statute of limitations in any action hereunder or for the collection or
performance of the Guaranteed Obligations;

 

118

 

(iii)          any defense
arising by reason of any lack of corporate or other authority or any other
defense of Borrower, such Guarantor or any other Person;

 

(iv)          any defense based
upon Administrative Agent’s or any Lending Party’s errors or omissions in the
administration of the Guaranteed Obligations;

 

(v)           any rights to
set-offs and counterclaims;

 

(vi)          without
limiting the generality of the foregoing, to the fullest extent permitted by
law, any defenses or benefits that may be derived from or afforded by
applicable law limiting the liability of or exonerating guarantors or sureties,
or that may conflict with the terms of this Section 10.14;
and

 

(vii)         any and all
notice of the acceptance of this guaranty, and any and all notice of the
creation, renewal, modification, extension or accrual of the Guaranteed
Obligations, or the reliance by Administrative Agent and Lending Parties upon
this Guaranty, or the exercise of any right, power or privilege hereunder.  The Guaranteed Obligations shall conclusively
be deemed to have been created, contracted, incurred and permitted to exist in
reliance upon this Guaranty.  Each
Subsidiary Guarantor waives promptness, diligence, presentment, protest, demand
for payment, notice of default, dishonor or nonpayment and all other notices to
or upon Borrower, each Guarantor or any other Person with respect to the
Guaranteed Obligations.

 

(g)           Financial
Condition of Borrower.  No
Subsidiary Guarantor shall have any right to require Administrative Agent or
any Lending Party to obtain or disclose any information with respect to:  the financial condition or character of
Borrower or the ability of Borrower to pay and perform the Guaranteed
Obligations; the Guaranteed Obligations; any collateral or other security for
any or all of the Guaranteed Obligations; the existence or nonexistence of any
other guarantees of all or any part of the Guaranteed Obligations; any action
or inaction on the part of Administrative Agent or any Lending Party or any
other Person; or any other matter, fact or occurrence whatsoever.  Each Subsidiary Guarantor hereby acknowledges
that it has undertaken its own independent investigation of the financial
condition of Borrower and all other matters pertaining to this Guaranty and
further acknowledges that it is not relying in any manner upon any
representation or statement of Administrative Agent or any Lending Party with
respect thereto.

 

(h)           Subrogation.  Until the Guaranteed Obligations shall be
satisfied in full and the Aggregate Commitments shall be terminated, each
Subsidiary Guarantor shall not have, and shall not directly or indirectly
exercise:  (i) any rights that it
may acquire by way of subrogation under this Section 10.14,
by any payment hereunder or otherwise; (ii) any rights of contribution,
indemnification, reimbursement or similar suretyship claims arising out of this
Section 10.14; or (iii) any
other right that it might otherwise have or acquire (in any way whatsoever)
that could entitle it at any time to share or participate in any right, remedy
or security of Administrative Agent or any Lending Party as against any
Borrower or other Guarantors or any other Person, whether in connection with
this Section 10.14, any of the other
Loan Documents or otherwise.  If any
amount shall be paid to any Subsidiary Guarantor on account of the foregoing
rights at any time when all the Guaranteed Obligations shall not have been paid
in full, such amount shall be held in trust for the benefit of Administrative
Agent and Lending Parties and 

 

119

 

shall
forthwith be paid to Administrative Agent to be credited and applied to the
Guaranteed Obligations, whether matured or unmatured, in accordance with the
terms of the Loan Documents.

 

(i)            Subordination.  All payments on account of all indebtedness,
liabilities and other obligations of Borrower to any Subsidiary Guarantor or to
any other Subordinated Guarantor, whether now existing or hereafter arising,
and whether due or to become due, absolute or contingent, liquidated or
unliquidated, determined or undetermined (the “Subsidiary
Guarantor Subordinated Debt”) shall be subject, subordinate and
junior in right of payment and exercise of remedies, to the extent and in the
manner set forth herein, to the prior payment in full in cash or cash
equivalents of the Guaranteed Obligations. 
As long as any of the Guaranteed Obligations (other than unasserted
contingent indemnification obligations) shall remain outstanding and unpaid,
each Subsidiary Guarantor shall not accept or receive any payment or
distribution by or on behalf of Borrower or any other Subsidiary Guarantor,
directly or indirectly, or assets of Borrower or any other Subsidiary
Guarantor, of any kind or character, whether in cash, property or securities,
including on account of the purchase, redemption or other acquisition of
Subsidiary Guarantor Subordinated Debt, as a result of any collection, sale or
other disposition of collateral, or by setoff, exchange or in any other manner,
for or on account of the Subsidiary Guarantor Subordinated Debt (“Subsidiary Guarantor Subordinated Debt Payments”),
except that, so long as an Event of Default does not then exist, any Subsidiary
Guarantor shall be entitled to accept and receive payments on its Subsidiary
Guarantor Subordinated Debt, in accordance with past business practices of such
Subsidiary Guarantor and Borrower (or any other applicable Subsidiary
Guarantor) and not in contravention of any Law or the terms of the Loan
Documents it being understood that any payments pursuant to the section are not
“Restricted Payments” hereunder.  .

 

If
any Subsidiary Guarantor Subordinated Debt Payments shall be received in
contravention of this Section 10.14,
such Subsidiary Guarantor Subordinated Debt Payments shall be held in trust for
the benefit of Administrative Agent and Lending Parties and shall be paid over
or delivered to Administrative Agent for application to the payment in full in
cash or cash equivalents of all Guaranteed Obligations remaining unpaid to the
extent necessary to give effect to this Section 10.14 after
giving effect to any concurrent payments or distributions to Administrative
Agent and Lending Parties in respect of the Guaranteed Obligations.

 

(j)            Continuing
Guaranty.  This
Guaranty is a continuing guaranty and agreement of subordination and shall
continue in effect and be binding upon each Subsidiary Guarantor until
termination of the Aggregate Commitments and payment and performance in full of
the Guaranteed Obligations, including Guaranteed Obligations which may exist
continuously or which may arise from time to time under successive
transactions, and each Subsidiary Guarantor expressly acknowledges that this
guaranty shall remain in full force and effect notwithstanding that there may
be periods in which no Guaranteed Obligations exist.  This Guaranty shall continue in effect and be
binding upon each Subsidiary Guarantor until actual receipt by Administrative
Agent of written notice from such Subsidiary Guarantor of its intention to
discontinue this Guaranty as to future transactions (which notice shall not be
effective until noon on the day that is five Business Days following such
receipt); provided that no revocation or
termination of this guaranty shall affect in any way any rights of
Administrative Agent, or any Lending Party hereunder with respect to any
Guaranteed Obligations arising or outstanding on the date of receipt of such
notice, including any subsequent continuation, extension, or renewal thereof,
or change in the terms or conditions thereof, or any Guaranteed Obligations
made or created after such date to the extent made or created pursuant to a
legally binding commitment of any Lending Party in existence 

 

120

 

as
of the date of such revocation (collectively, “Existing
Guaranteed Obligations”), and the sole effect of such notice
shall be to exclude from this Guaranty Guaranteed Obligations thereafter
arising which are unconnected to any Existing Guaranteed Obligations.

 

(k)           Reinstatement.  This Guaranty shall continue to be effective
or shall be reinstated and revived, as the case may be, if, for any reason, any
payment of the Guaranteed Obligations by or on behalf of Borrower (or receipt
of any proceeds of collateral) shall be rescinded, invalidated, declared to be
fraudulent or preferential, set aside, voided or otherwise required to be
repaid to Borrower, its estate, trustee, receiver or any other Person
(including under any Bankruptcy Law), or must otherwise be restored by
Administrative Agent or any Lending Party, whether as a result of proceedings
under any Bankruptcy Law or otherwise. 
All losses, damages, costs and expenses that Administrative Agent, or
any Lending Party may suffer or incur as a result of any voided or otherwise
set aside payments shall be specifically covered by the indemnity in favor of
Administrative Agent and Lending Parties contained in Section 10.04.

 

(l)            Substantial
Benefits.  The Credit
Extensions provided to or for the benefit of Borrower hereunder by Lending
Parties have been and are to be contemporaneously used for the benefit of
Borrower and each Subsidiary Guarantor. 
It is the position, intent and expectation of the parties that Borrower
and each Subsidiary Guarantor have derived and will derive significant and
substantial benefits from the Credit Extensions to be made available by Lending
Parties under the Loan Documents.  Each
Subsidiary Guarantor has received at least “reasonably equivalent value” (as
such phrase is used in Section 548 of the Bankruptcy Code, in the Uniform
Fraudulent Transfer Act and in comparable provisions of other applicable law)
and more than sufficient consideration to support its obligations hereunder in
respect of the Guaranteed Obligations. 
Immediately prior to and after and giving effect to the incurrence of
each Subsidiary Guarantor’s obligations under this Guaranty, such Subsidiary
Guarantor will be solvent.

 

(m)          KNOWING
AND EXPLICIT WAIVERS.  EACH
SUBSIDIARY GUARANTOR ACKNOWLEDGES THAT IT EITHER HAS OBTAINED THE ADVICE OF
LEGAL COUNSEL OR HAS HAD THE OPPORTUNITY TO OBTAIN SUCH ADVICE IN CONNECTION
WITH THE TERMS AND PROVISIONS OF THIS SECTION 10.14.  EACH SUBSIDIARY GUARANTOR ACKNOWLEDGES AND
AGREES THAT EACH OF THE WAIVERS AND CONSENTS SET FORTH HEREIN IS MADE WITH FULL
KNOWLEDGE OF ITS SIGNIFICANCE AND CONSEQUENCES, THAT ALL SUCH WAIVERS AND
CONSENTS HEREIN ARE EXPLICIT AND KNOWING AND THAT EACH SUBSIDIARY GUARANTOR
EXPECTS SUCH WAIVERS AND CONSENTS TO BE FULLY ENFORCEABLE.

 

If,
while any Subsidiary Guarantor Subordinated Debt is outstanding, any proceeding
under any Bankruptcy Law is commenced by or against Borrower or its property,
Administrative Agent, when so instructed by L/C Issuer, Swing Line Lender
and Required Lenders, is hereby irrevocably authorized and empowered (in the
name of Lending Parties or in the name of any Subsidiary Guarantor or
otherwise), but shall have no obligation, to demand, sue for, collect and
receive every payment or distribution in respect of all Subsidiary Guarantor
Subordinated Debt and give acquittances therefor and to file claims and proofs
of claim and take such other action (including voting the Subsidiary Guarantor
Subordinated Debt) as it may deem necessary or advisable for the exercise or
enforcement of any of the rights or interests of Administrative Agent and
Lending Parties; and each Subsidiary Guarantor shall promptly take such action
as Administrative Agent (on instruction from L/C Issuer, Swing Line Lender
and Required Lenders) may reasonably request: (A) to collect the
Subsidiary Guarantor Subordinated Debt 

 

121

 

for
the account of the Lending Parties and to file appropriate claims or proofs of
claim in respect of the Subsidiary Guarantor Subordinated Debt; (B) to
execute and deliver to Administrative Agent such powers of attorney,
assignments and other instruments as it may request to enable it to enforce any
and all claims with respect to the Subsidiary Guarantor Subordinated Debt; and
(C) to collect and receive any and all Subsidiary Guarantor Subordinated
Debt Payments.

 

SECTION 10.15       TIME OF THE ESSENCE.

 

Time
is of the essence of the Loan Documents.

 

SECTION 10.16       GOVERNING LAW; JURISDICTION; ETC.

 

(a)           GOVERNING
LAW.  THIS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW OTHER THAN NEW YORK
GENERAL OBLIGATIONS LAW 5-1401 AND 5-1402).

 

(b)           SUBMISSION
TO JURISDICTION.  BORROWER AND
EACH OTHER LOAN PARTY PARTY HERETO EACH IRREVOCABLY AND UNCONDITIONALLY
SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE
COURTS OF THE SUPREME COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY
IN THE BOROUGH OF MANHATTAN AND OF THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN
ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT TO WHICH EACH IS A PARTY, OR FOR RECOGNITION OR ENFORCEMENT
OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY
AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE
HEARD AND DETERMINED IN SUCH STATE COURTS OR, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, IN SUCH FEDERAL COURTS. 
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 IN ANY
OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT ADMINISTRATIVE AGENT OR ANY
LENDING PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST ANY LOAN PARTY OR
ANY OF ITS PROPERTIES IN THE COURTS OF ANY OTHER JURISDICTION.

 

(c)           WAIVER
OF VENUE.  BORROWER AND
EACH OTHER LOAN PARTY PARTY HERETO EACH IRREVOCABLY AND UNCONDITIONALLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW
OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT
REFERRED TO IN SUBSECTION (B) OF THIS SECTION 10.16.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN
INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH
COURT.

 

(d)           SERVICE
OF PROCESS.  BORROWER AND
EACH OTHER LOAN PARTY PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS
IN THE MANNER PROVIDED FOR NOTICES IN 

 

122

 

SECTION 10.02.  NOTHING IN THIS AGREEMENT WILL AFFECT THE
RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
APPLICABLE LAW.

 

SECTION 10.17       WAIVER OF RIGHT TO JURY TRIAL.

 

TO
THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE PARTIES HERETO HEREBY
WAIVES ITS RIGHT TO A JURY TRIAL OF ANY CLAIM. 
EACH OF THE PARTIES HERETO REPRESENTS THAT EACH HAS REVIEWED THIS WAIVER
AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL ON SUCH MATTERS.

 

[SIGNATURE PAGES FOLLOW.]

 

123

 

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

 

BORROWER:

 

	
  TITAN
  MACHINERY INC.,

  	
   

  
	
  a
  Delaware corporation

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  Ted O. Christianson

  	
   

  
	
  Name:

  	
  Ted
  O. Christianson

  	
   

  
	
  Title:

  	
  Vice
  President of Finance

  	
   

  

 

 

	
  ADMINISTRATIVE
  AGENT, L/C ISSUER AND SWING LINE LENDER:

  	
   

  
	
   

  	
   

  
	
  WELLS
  FARGO BANK, NATIONAL ASSOCIATION,

  	
   

  
	
  a
  national banking association, as Administrative Agent, L/C Issuer and Swing
  Line Lender

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  Mark T. Lundquist

  	
   

  	
   

  
	
  Name:

  	
  Mark
  T. Lundquist

  	
   

  	
   

  
	
  Title:

  	
  Vice
  President

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  WELLS
  FARGO BANK, NATIONAL ASSOCIATION,

  	
   

  
	
  a
  national banking association, as a Lender

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  Mark T. Lundquist

  	
   

  	
   

  
	
  Name:

  	
  Mark
  T. Lundquist

  	
   

  	
   

  
	
  Title:

  	
  Vice
  President

  	
   

  	
   

  
	
   

  	
   

  

 

	
  WORKING CAPITAL COMMITMENT:

  	
   

  	
  $

  	
  17,777,777.78

  	
   

  
	
  FLOORPLAN COMMITMENT:

  	
   

  	
  $

  	
  62,222,222.22

  	
   

  

 

 

 

 

	
  LENDER:

  	
   

  
	
   

  	
   

  
	
  COBANK,
  ACB

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  Lois Timkovich

  	
   

  
	
  Name:

  	
  Lois
  Timkovich

  	
   

  
	
  Title:

  	
  Assistant
  Corporate Secretary

  	
   

  

 

 

	
  WORKING CAPITAL COMMITMENT:

  	
   

  	
  $

  	
  8,888,888.89

  	
   

  
	
  FLOORPLAN COMMITMENT:

  	
   

  	
  $

  	
  31,111,111.11

  	
   

  

 

 

	
  LENDER:

  	
   

  
	
   

  	
   

  
	
  BANK OF AMERICA, N.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Don Stafford

  	
   

  
	
  Name:

  	
  Don Stafford

  	
   

  
	
  Title:

  	
  Senior Vice President

  	
   

  

 

 

	
  WORKING CAPITAL COMMITMENT:

  	
   

  	
  $

  	
  8,888,888.89

  	
   

  
	
  FLOORPLAN COMMITMENT:

  	
   

  	
  $

  	
  31,111,111.11

  	
   

  

 

 

	
  LENDER:

  	
   

  
	
   

  	
   

  
	
  U.S. BANK NATIONAL ASSOCIATION

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Magnus McDowell

  	
   

  
	
  Name:

  	
  Magnus McDowell

  	
   

  
	
  Title:

  	
  Vice President

  	
   

  

 

 

	
  WORKING CAPITAL COMMITMENT:

  	
   

  	
  $

  	
  6,666,666.67

  	
   

  
	
  FLOORPLAN COMMITMENT:

  	
   

  	
  $

  	
  23,333,333.33

  	
   

  

 

 

	
  LENDER:

  	
   

  
	
   

  	
   

  
	
  BANK OF THE WEST

  	
   

  
	
  a California banking
  corporation

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Michael Lax

  	
   

  
	
  Name:

  	
  Michael Lax

  	
   

  
	
  Title:

  	
  Senior Vice President

  	
   

  

 

 

	
  WORKING CAPITAL COMMITMENT:

  	
   

  	
  $

  	
  4,444,444.44

  	
   

  
	
  FLOORPLAN COMMITMENT:

  	
   

  	
  $

  	
  15,555,555.56

  	
   

  

 

 

	
  LENDER:

  	
   

  
	
   

  	
   

  
	
  BREMER BANK, N.A.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Wesley Well

  	
   

  
	
  Name:

  	
  Wesley Well

  	
   

  
	
  Title:

  	
  President — Lisbon, N.D.

  	
   

  

 

 

	
  WORKING CAPITAL COMMITMENT:

  	
   

  	
  $

  	
  3,333,333.33

  	
   

  
	
  FLOORPLAN COMMITMENT:

  	
   

  	
  $

  	
  11,666,666.67

  	
   

  

 

 

SCHEDULE 1.01-A

 

APPLICABLE RATES

 

WORKING CAPITAL LOANS

 

	
  Tier

  	
   

  	
  Consolidated Leverage

  Ratio

  	
   

  	
  Applicable

  LIBOR Margin

  	
   

  	
  Applicable

  Base Rate

  Margin

  	
   

  	
  Applicable

  Working

  Capital

  Commitment

  Fee Margin

  	
   

  	
  Applicable L/C

  Margin

  	
   

  
	
  1

  	
   

  	
  <1.50

  	
   

  	
  1.5000

  	
  %

  	
  0.5000

  	
  %

  	
  0.2000

  	
  %

  	
  1.5000

  	
  %

  
	
  2

  	
   

  	
  >1.50 but <2.00

  	
   

  	
  1.7500

  	
  %

  	
  0.7500

  	
  %

  	
  0.3000

  	
  %

  	
  1.7500

  	
  %

  
	
  3

  	
   

  	
  >2.00

  	
   

  	
  2.0000

  	
  %

  	
  1.0000

  	
  %

  	
  0.4000

  	
  %

  	
  2.0000

  	
  %

  

 

FLOORPLAN LOANS

 

	
  Tier

  	
   

  	
  Consolidated Leverage

  Ratio

  	
   

  	
  Applicable

  LIBOR Margin

  	
   

  	
  Applicable 

  Base Rate 

  Margin

  	
   

  	
  Applicable

  Floorplan

  Commitment

  Fee Margin

  	
   

  
	
  1

  	
   

  	
  <1.50

  	
   

  	
  1.5000

  	
  %

  	
  0.5000

  	
  %

  	
  0.2000

  	
  %

  
	
  2

  	
   

  	
  >1.50 but <2.00

  	
   

  	
  1.7500

  	
  %

  	
  0.7500

  	
  %

  	
  0.3000

  	
  %

  
	
  3

  	
   

  	
  >2.00

  	
   

  	
  2.0000

  	
  %

  	
  1.0000

  	
  %

  	
  0.4000

  	
  %Exhibit 10.1

 

OXFORD INDUSTRIES, INC.

 

DEFERRED COMPENSATION PLAN

 

(As amended and restated
effective September 1, 2010)

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE I
  DEFINITIONS

  	
  1

  
	
  Section 1.1.

  	
  Account

  	
  1

  
	
  Section 1.2.

  	
  Beneficiary

  	
  1

  
	
  Section 1.3.

  	
  Board

  	
  1

  
	
  Section 1.4.

  	
  Code

  	
  1

  
	
  Section 1.5.

  	
  Committee

  	
  1

  
	
  Section 1.6.

  	
  Company

  	
  1

  
	
  Section 1.7.

  	
  Compensation

  	
  1

  
	
  Section 1.8.

  	
  Director

  	
  1

  
	
  Section 1.9.

  	
  Discretionary Contribution

  	
  2

  
	
  Section 1.10.

  	
  Election Period

  	
  2

  
	
  Section 1.11.

  	
  Eligible Compensation

  	
  2

  
	
  Section 1.12.

  	
  Eligible Employee

  	
  2

  
	
  Section 1.13.

  	
  Eligible Participant

  	
  2

  
	
  Section 1.14.

  	
  Employee

  	
  2

  
	
  Section 1.15.

  	
  ERISA

  	
  2

  
	
  Section 1.16.

  	
  Excess Compensation

  	
  2

  
	
  Section 1.17.

  	
  401(k) Plan

  	
  2

  
	
  Section 1.18.

  	
  Matching Contribution

  	
  2

  
	
  Section 1.19.

  	
  Maximum Deferral Percentage

  	
  2

  
	
  Section 1.20.

  	
  Minimum Deferral Amount

  	
  3

  
	
  Section 1.21.

  	
  Oxford

  	
  3

  
	
  Section 1.22.

  	
  Plan

  	
  3

  
	
  Section 1.23.

  	
  Plan Year

  	
  3

  
	
  Section 1.24.

  	
  Pre-2005 Oxford Plan

  	
  3

  
	
  Section 1.25.

  	
  Retirement Age

  	
  3

  
	
  Section 1.26.

  	
  Separates from Service or Separation
  from Service

  	
  3

  
	
  (a)

  	
  Leaves of Absence

  	
  3

  
	
  (b)

  	
  Status Change

  	
  3

  
	
  (c)

  	
  Termination of Employment

  	
  4

  
	
  (d)

  	
  Separation of Director

  	
  4

  
	
  (e)

  	
  Controlled Group

  	
  4

  
	
  Section 1.27.

  	
  Tommy Bahama Plan

  	
  4

  
	
  Section 1.28.

  	
  Years of Service

  	
  4

  
	
   

  	
   

  	
   

  
	
  ARTICLE II
  PARTICIPATION AND DEFERRAL ELECTIONS

  	
  5

  
	
  Section 2.1.

  	
  Start-Up Deferral Elections

  	
  5

  
	
  (a)

  	
  Eligible Employees

  	
  5

  
	
  (b)

  	
  Directors

  	
  5

  
	
  Section 2.2.

  	
  Annual Deferral Elections

  	
  5

  
	
  (a)

  	
  Salary

  	
  5

  
	
  (b)

  	
  Bonuses

  	
  6

  
	
  (c)

  	
  Commissions

  	
  6

  
	
  (d)

  	
  Directors’ Deferrals

  	
  6

  
	
  Section 2.3.

  	
  Minimum Deferral Amount

  	
  7

  
	
  Section 2.4.

  	
  Ongoing Election

  	
  7

  
	
  Section 2.5.

  	
  Effect of Hardship Withdrawal

  	
  7

  

 

i

 

	
  Section 2.6.

  	
  Form of Elections

  	
  7

  
	
   

  	
   

  	
   

  
	
  ARTICLE III
  MATCHING CONTRIBUTIONS

  	
  7

  
	
   

  	
   

  
	
  ARTICLE IV
  DISCRETIONARY CONTRIBUTIONS

  	
  7

  
	
   

  	
   

  
	
  ARTICLE V
  ACCOUNT ADJUSTMENTS

  	
  8

  
	
  Section 5.1.

  	
  General

  	
  8

  
	
  Section 5.2.

  	
  Deferrals

  	
  8

  
	
  Section 5.3.

  	
  Matching and Discretionary
  Contributions

  	
  8

  
	
  Section 5.4.

  	
  Phantom Investments

  	
  8

  
	
  Section 5.5.

  	
  Phantom Investment Election

  	
  8

  
	
  Section 5.6.

  	
  Phantom Investment Adjustments

  	
  8

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI
  VESTING

  	
  8

  
	
  Section 6.1.

  	
  Amounts Deferred

  	
  8

  
	
  Section 6.2.

  	
  Matching Contributions

  	
  8

  
	
  Section 6.3.

  	
  Discretionary Contributions

  	
  8

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII
  DISTRIBUTIONS

  	
  9

  
	
  Section 7.1.

  	
  Distribution Elections

  	
  9

  
	
  (a)

  	
  General

  	
  9

  
	
  (b)

  	
  Ongoing Election

  	
  9

  
	
  (c)

  	
  Default

  	
  9

  
	
  Section 7.2.

  	
  Time of Distribution

  	
  9

  
	
  (a)

  	
  Separation from Service

  	
  9

  
	
  (b)

  	
  Death

  	
  9

  
	
  (c)

  	
  In-Service

  	
  9

  
	
  (d)

  	
  Hardship Withdrawal due to
  Unforeseeable Emergency

  	
  10

  
	
  (e)

  	
  Delay of Payments Under Certain
  Circumstances

  	
  10

  
	
  Section 7.3.

  	
  Distribution Forms

  	
  11

  
	
  (a)

  	
  Separation from Service After
  Retirement Age

  	
  11

  
	
  (b)

  	
  Separation from Service Before
  Retirement Age or Death

  	
  11

  
	
  (c)

  	
  In-Service

  	
  11

  
	
  (d)

  	
  Installments

  	
  11

  
	
  Section 7.4.

  	
  Beneficiary

  	
  11

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII
  NO FUNDING OBLIGATION

  	
  11

  
	
   

  	
   

  
	
  ARTICLE IX
  COMPLIANCE WITH CODE SECTION 409A

  	
  12

  
	
   

  	
   

  
	
  ARTICLE X
  MISCELLANEOUS

  	
  12

  
	
  Section 10.1.

  	
  Medium of Payment

  	
  12

  
	
  Section 10.2.

  	
  Making and Revoking Elections and
  Designations

  	
  12

  
	
  Section 10.3.

  	
  Statements

  	
  12

  
	
  Section 10.4.

  	
  Claims Procedure

  	
  12

  
	
  Section 10.5.

  	
  Withholding

  	
  12

  
	
  Section 10.6.

  	
  No Liability

  	
  12

  
	
  Section 10.7.

  	
  Nonalienation of Benefits

  	
  12

  
	
  Section 10.8.

  	
  Plan Administration

  	
  13

  
	
  Section 10.9.

  	
  Construction

  	
  13

  
	
  Section 10.10.

  	
  No Contract of Employment

  	
  13

  
	
  Section 10.11.

  	
  ERISA

  	
  13

  

 

ii

 

	
  Section 10.12.

  	
  Amendment and Termination

  	
  13

  
	
  Section 10.13.

  	
  Pre-2005 Oxford Plan

  	
  13

  
	
  (a)

  	
  Pre-2005 Deferrals

  	
  13

  
	
  (b)

  	
  Post-2004 and Pre-2006 Deferrals

  	
  14

  
	
  Section 10.14.

  	
  Tommy Bahama Plan

  	
  14

  
	
  (a)

  	
  Pre-2005 Deferrals

  	
  14

  
	
  (b)

  	
  Post-2004 and Pre-2006 Deferrals

  	
  14

  
	
  Section 10.15.

  	
  Special Transition Bonus Election

  	
  14

  
	
   

  	
   

  	
   

  
	
  EXHIBIT A

  	
   

  	
  A-1

  
	
   

  	
   

  	
   

  
	
  EXHIBIT B

  	
   

  	
  B-1

  
	
   

  	
   

  	
   

  
	
  EXHIBIT C

  	
   

  	
  C-1

  
	
   

  	
   

  	
   

  
	
  EXHIBIT D

  	
   

  	
  D-1

  

 

iii

 

OXFORD INDUSTRIES, INC.

 

DEFERRED COMPENSATION PLAN

 

(As amended and restated effective September 1,
2010)

 

The primary purpose of this Plan is to assist Oxford
Industries, Inc. (“Oxford”) and its subsidiaries in attracting and
retaining employees and directors of exceptional ability by (a) allowing a
select group of management or highly-compensated employees of Oxford and
certain of its subsidiaries, and nonemployee members of Oxford’s Board of
Directors, to defer the payment of a portion of their compensation that
otherwise would become payable to them, and (b) providing for
discretionary contributions and matching contributions for Eligible Employees
based on compensation that exceeds the compensation that may be taken into
account under the Oxford Industries, Inc. Retirement Savings Plan or as a
result of the dollar limitation applicable to the 401(k) Plan under Section 401(a)(17)
of the Code.  This Plan is an amendment
and restatement of the Oxford Industries, Inc. Deferred Compensation Plan
(as amended and restated effective January 1, 2008, and as subsequently
amended).  The terms of the Plan
supersede those of the Oxford Industries, Inc. Non-Qualified Deferred
Compensation Plan adopted effective January 1, 2001, and the Viewpoint
International, Inc. Nonqualified Deferred Compensation Plan adopted
effective July 20, 2001, except with respect to amounts deferred prior to January 1,
2006, as provided in Sections 10.13 and 10.14.

 

ARTICLE I

 

DEFINITIONS

 

Section 1.1.                                           Account — means
the bookkeeping account maintained by or at the direction of the Committee to
show as of any date the benefit of each Eligible Participant.  Separate subaccounts may be established and
maintained as part of an Eligible Participant’s Account as the Committee deems
necessary or appropriate to administer this Plan.

 

Section 1.2.                                           Beneficiary — means
the person or persons designated as such in accordance with Section 7.4.

 

Section 1.3.                                           Board — means
the Board of Directors of Oxford.

 

Section 1.4.                                           Code — means the Internal Revenue
Code of 1986, as amended, and rules and regulations promulgated
thereunder, and any successor thereto.

 

Section 1.5.                                           Committee — means the committee appointed by the Board to administer the Plan.

 

Section 1.6.                                           Company — means Oxford and each subsidiary of Oxford that is designated by the
Board as a participating company under this Plan.

 

Section 1.7.                                           Compensation — means, for any Plan Year, “compensation”
as defined in the 401(k) Plan for purposes of determining the amount of
pre-tax contributions and matching contributions under such plan, without
regard to any limitations on compensation imposed under Section 401(a)(17)
of the Code, plus any deferrals made under this Plan for such Plan Year.

 

Section 1.8.                                           Director — means any individual who is
a member of the Board and who is not an Employee.

 

 

Section 1.9.                                           Discretionary Contribution — means
the amount, if any, credited to an Eligible Employee’s Account in accordance
with Article IV.

 

Section 1.10.                                     Election Period — means an annual
enrollment period described in Section 2.2(a), (b)(2), (c) and (d); a
30-day (or shorter) enrollment period described in Section 2.1(a) and
(b); or a Performance-based Election Period described in Section 2.2(b)(1).

 

Section 1.11.                             Eligible Compensation — means
all amounts that may be eligible for deferral under this Plan.  More specifically, (i) with respect to
an Eligible Employee, “Eligible Compensation” means the Eligible Employee’s
base salary, bonus and, if authorized by the Committee for a Plan Year,
commissions; and (ii) with respect to a Director, “Eligible Compensation”
means cash compensation payable to the Director for service on the Board and
committees thereof as cash retainers (excluding any such amount payable in the
form of Oxford stock pursuant to an election by a Director made before the
deadline for making a deferral election under this Plan) and meeting fees.  Additionally, with respect to an Eligible
Employee, Eligible Compensation payable after the last day of the Plan Year for
services performed during the final payroll period described in Section 3401(b) of
the Code containing the last day of the Plan Year shall be treated for purposes
of this Plan as Eligible Compensation for services performed in the Plan Year
during which such amount is paid.  With
respect to a Director, Eligible Compensation payable before the last day of the
Plan Year for services performed during the final quarterly compensation period
(under Oxford’s compensation practices for Directors) containing the last day
of the Plan Year shall be treated for purposes of this Plan as Eligible
Compensation for services performed in the Plan Year during which such amount
is paid.

 

Section 1.12.                                     Eligible Employee — means, for each Plan
Year, any Employee of a Company who was an Eligible Employee on December 31,
2009, and any other Employee of a Company whose gross annual rate of base
salary is $150,000 or more.  The
Committee in its discretion may adjust the foregoing salary threshold for Plan
Years subsequent to Plan Year 2010; provided, however, that unless otherwise
determined by the Committee, an increase in the salary threshold shall not
apply to an Employee who commenced participation in the Plan prior to the Plan
Year in which such increase is effective.

 

Section 1.13.                                         Eligible Participant — means
each Director and Eligible Employee.

 

Section 1.14.                                     Employee — means an employee of Oxford
or any subsidiary of Oxford.

 

Section 1.15.                                     ERISA — means the Employee Retirement Income Security Act of 1974, as amended.

 

Section 1.16.                                     Excess Compensation — means the excess of
an Eligible Employee’s Compensation for a Plan Year over the Eligible Employee’s
“compensation” as defined in the 401(k) Plan for purposes of determining
the amount of pre-tax contributions and matching contributions under such plan
for such Plan Year.

 

Section 1.17.                                     401(k) Plan — means the Oxford
Industries, Inc. Retirement Savings Plan, as amended and as in effect from
time to time, or any other successor defined contribution maintained by Oxford
or another Company that qualifies under Section 401(a) of the Code
and satisfies the requirements of Section 401(k) of the Code.

 

Section 1.18.                                     Matching Contribution — means
the amount credited to an Eligible Employee’s Account in accordance with Article III.

 

Section 1.19.                                     Maximum Deferral Percentage — means,
with respect to an Eligible Participant for each Plan Year, the maximum
percentage of the Eligible Participant’s Eligible Compensation that can 

 

2

 

be deferred under the Plan,
which (i) with respect to an Eligible Employee, shall be 50% of his or her
base salary, 100% of his or her bonus and, if authorized by the Committee for a
Plan Year, 50% of his or her commissions, unless otherwise determined by the
Committee prior to the beginning of such Plan Year; provided, however, that no
deferral election may reduce an Eligible Employee’s compensation below an
amount necessary to satisfy applicable employment and income tax withholding
requirements; and (ii) with respect to a Director, shall be 100% of his or
her cash retainer and 100% of his or her meeting fees for each Plan Year,
unless otherwise determined by the Committee prior to the beginning of such
Plan Year.

 

Section 1.20.                                     Minimum Deferral Amount — means,
for each Plan Year, an amount equal to 1% of an Eligible Employee’s base
salary, unless otherwise determined by the Committee prior to the beginning of
such Plan Year.

 

Section 1.21.                                     Oxford — means Oxford Industries, Inc. and any successor to Oxford
Industries, Inc.

 

Section 1.22.                                     Plan — means this Oxford Industries, Inc. Deferred Compensation Plan, as
amended and restated effective September 1, 2010, as it may be amended in
accordance with the terms hereof from time to time.

 

Section 1.23.                                     Plan Year — means the calendar year.

 

Section 1.24.                                     Pre-2005 Oxford Plan — means
the Oxford Industries, Inc. Non-Qualified Deferred Compensation Plan
adopted effective January 1, 2001, as thereafter amended, as such amended
plan was in effect on October 3, 2004.

 

Section 1.25.                                     Retirement Age — means, with respect to an
Eligible Employee, age 55 and 5 Years of Service; each Director shall at all
times be deemed to have attained Retirement Age for purposes of this Plan.

 

Section 1.26.                                     Separates from Service or Separation from Service — means the termination of employment with Oxford and its subsidiaries
or cessation of Board service, as the case may be, in such a manner as to
constitute a “separation from service” (other than death) within the meaning of
Section 409A of the Code.

 

As a general overview of Code Section 409A’s
definition of “separation from service”, an Eligible Participant separates from
service if an Eligible Employee has a termination of employment or a Director
ceases to perform services (in either case, other than for death) with Oxford
and all members of the controlled group, determined in accordance with the
following:

 

(a)                                  Leaves of Absence.  For Eligible Employees, the employment
relationship is treated as continuing intact while the Eligible Employee is on
military leave, sick leave, or other bona fide leave of absence if the period
of such leave does not exceed 6 months, or, if longer, so long as the Eligible
Employee retains a right to reemployment with the Company or a member of the
controlled group under an applicable statute or by contract.  A leave of absence constitutes a bona fide
leave of absence only while there is a reasonable expectation that the Eligible
Employee will return to perform services for Oxford or a member of the
controlled group.  If the period of leave
exceeds 6 months and the Eligible Employee does not retain a right to
reemployment under an applicable statute or by contract, the employment
relationship is deemed to terminate on the first date immediately following
such 6-month period.

 

(b)                                 Status Change.  Generally, if an Eligible Employee performs
services both as an Employee and an independent contractor, the Eligible
Employee must separate from service both as an 

 

3

 

Employee and as an independent
contractor pursuant to standards set forth in Treasury Regulations to be
treated as having a separation from service. 
However, if an Eligible Employee provides services as an Employee and as
a member of the Board, the services provided as a Director are not taken into
account in determining whether the Eligible Employee has a separation from
service as an Employee for purposes of this Plan.

 

(c)                                  Termination of Employment.  Whether a termination of employment has
occurred is determined based on whether the facts and circumstances indicate
that the Company, all members of the controlled group and the Eligible Employee
reasonably anticipate that (1) no further services will be performed after
a certain date, or (2) the level of bona fide services the Eligible
Employee will perform after such date (whether as an Employee or as an
independent contractor) will permanently decrease to no more than 20% of the
average level of bona fide services performed (whether as an Employee or an
independent contractor) over the immediately preceding 36-month period (or the
full period of services to Oxford and all members of the controlled group if
the Eligible Employee has been providing services to Oxford and all members of
the controlled group for less than 36 months). 
Facts and circumstances to be considered in making this determination
include, but are not limited to, whether the Eligible Employee continues to be
treated as an Employee for other purposes (such as continuation of salary and
participation in employee benefit programs), whether similarly-situated service
providers have been treated consistently, and whether the Eligible Employee is
permitted, and realistically available, to perform services for other service
recipients in the same line of business. 
For periods during which an Eligible Employee is on a paid bona fide
leave of absence and has not otherwise terminated employment as described in
subsection (a) above, for purposes of this subsection, the Eligible
Employee is treated as providing bona fide services at a level equal to the
level of services that the Eligible Employee would have been required to
perform to receive the compensation paid with respect to such leave of
absence.  Periods during which an
Eligible Employee is on an unpaid bona fide leave of absence and has not otherwise
terminated employment are disregarded for purposes of this subsection
(including for purposes of determining the applicable 36-month (or shorter)
period).

 

(d)                                 Separation of Director.  For Directors, whether a separation from
service has occurred is determined based on whether the facts and circumstances
indicate that Oxford and the Director reasonably anticipate that the Director
has ceased to perform services under circumstances constituting a good faith
and complete termination of the relationship (and only if Oxford does not
anticipate a renewal of the relationship or the Director becoming an
Employee).  If a Director also provides
additional services as an independent contractor, the Director will not be considered
to have a separation from service for purposes of Section 409A until he or
she has separated from service both as a Director and as an independent
contractor.

 

(e)                                  Controlled Group.  For purposes of this Section 1.25, “controlled
group” means any other entity that would be required to be aggregated with
Oxford under Code Sections 414(b) or (c), determined, however, by using “at
least 50 percent” instead of “at least 80 percent” in applying Code Section 414(b) or
(c).

 

Section 1.27.                                     Tommy Bahama Plan — means the Viewpoint
International, Inc. Nonqualified Deferred Compensation Plan adopted
effective July 20, 2001 as thereafter amended, as such amended plan was in
effect on October 3, 2004.

 

Section 1.28.                                     Years of Service — means “years of
service” as defined in the 401(k) Plan.

 

4

 

ARTICLE II

 

PARTICIPATION
AND DEFERRAL ELECTIONS

 

Section 2.1.                                           Start-Up Deferral Elections.  Each person who first qualifies as an
Eligible Participant after the beginning of a Plan Year but before the annual
enrollment period for the next following Plan Year, or after the beginning of a
performance period, and who is treated as first becoming eligible to
participate in the Plan or any “account balance” plan aggregated with the Plan
under the plan aggregation rules of Section 409A of the Code, shall
be eligible to elect to participate in this Plan during the 30-day period (or a
shorter period specified by the Committee) starting on the date he or she first
qualifies as an Eligible Participant. 
All such elections shall be made in conformance with the rules under
Section 409A of the Code for determining whether such an Eligible
Participant may be treated as first becoming eligible.

 

(a)                                  Eligible Employees.  Each such Eligible Employee may elect prior
to the end of such 30-day (or shorter) period to defer from his or her Eligible
Compensation up to the Maximum Deferral Percentage (in whole percentage
increments) of his or her base salary and bonus, and (if authorized by the
Committee) commissions, for services performed after the date the Eligible
Employee’s deferral election is made and becomes effective.  Any such election shall be irrevocable at the
end of such 30-day (or shorter) period and through the end of the Plan Year or
performance period for which it is made (except as provided in Section 2.5).  Any such deferral of salary, or of
commissions if applicable, shall be effective beginning with the paycheck for
the first regular payroll period beginning after the deferral election is made
and becomes effective.  The amount of any
bonus deferred with respect to an election made after the beginning of a
performance period will be prorated in accordance with Section 409A of the
Code.

 

(b)                                 Directors.  Each such Director may elect prior to the end
of such 30-day (or shorter) period to defer from his or her Eligible
Compensation up to the Maximum Deferral Percentage (in whole percentage
increments) of his or her cash retainer and meeting fees for services performed
thereafter.  Such deferral elections
shall first relate to (i) a Director’s cash retainer for the 3-month
period for which quarterly payments of Director compensation are made that
begins after the date the Director’s deferral election is made and becomes
effective, and (ii) a Director’s meeting fees for all meetings of the
Board (or a committee thereof) that are held after the date the Director’s
deferral election is made and becomes effective.  Each Director on September 1, 2010, may
elect to participate in the Plan for the remainder of the 2010 Plan Year on or
prior to September 13, 2010.  In any
case, any such election shall be irrevocable at the end of such 30-day (or
shorter) period and through the end of the Plan Year for which it is made
(except as provided in Section 2.5).

 

Section 2.2.                                           Annual Deferral Elections.

 

(a)                                  Salary.  An Eligible Employee shall have the right
during the enrollment period established by the Committee to defer up to the
Maximum Deferral Percentage (in whole percentage increments) of his or her base
salary for services performed in the following Plan Year.  Any such election that is not revoked by December 31
following (or coinciding with) the end of the enrollment period shall become
irrevocable (at the end of the day) on such December 31 and shall remain
irrevocable through the end of the Plan Year for which it is made (except as
provided in Section 2.5).

 

5

 

(b)                                 Bonuses.

 

(1)                                  Performance-Based Compensation Bonus.  An Eligible Employee may elect during the
annual enrollment period or any other election period described in clause (iii) below
to defer up to the Maximum Deferral Percentage (in whole percentage increments)
of a “performance-based compensation” bonus earned for services performed
during such performance period; provided that (i) such bonus constitutes “performance-based
compensation” within the meaning of Section 409A of the Code, (ii) the
performance period is at least 12 months, (iii) the election period ends
at least 6 months before the end of the performance period (the “Performance-based
Election Period”), (iv) the Eligible Employee has been an Employee
continuously from the date upon which the performance criteria were established
through the date of such election, and (v) at the time of the election,
the performance-based compensation is not substantially certain to be paid or
is not readily ascertainable.  Any such
election that is not revoked by the end of the applicable enrollment period
described above shall be irrevocable immediately following such enrollment
period and shall remain irrevocable through the end of the performance period
(except as provided in Section 2.5).

 

(2)                                  Other Bonuses.  If a bonus is not intended to satisfy the
requirements for “performance-based compensation” within the meaning of Section 409A
of the Code, then an Eligible Employee may elect during an annual enrollment
period established by the Committee to defer up to the Maximum Deferral
Percentage (in whole percentage increments) of such bonus that otherwise would
be payable to such Eligible Employee for services performed during the
performance period that begins in the following Plan Year.  Any such election that is not revoked by December 31
following (or coinciding with) the end of the enrollment period shall become
irrevocable (at the end of the day) on such December 31 and shall remain
irrevocable through the end of such performance period (except as provided in Section 2.5).

 

(c)                                  Commissions.  If the Committee in its discretion determines
to allow deferrals to be made with respect to commissions for any Plan Year, an
Eligible Employee may elect during the annual enrollment period established by
the Committee preceding such Plan Year to defer up to the Maximum Deferral
Percentage (in whole percentage increments) of his or her commissions that are
treated under Section 409A of the Code as attributable to services
performed by him or her during such Plan Year. 
Any such election that is not revoked by December 31 following (or
coinciding with) the end of the enrollment period shall become irrevocable (at
the end of the day) on such December 31 and shall remain irrevocable
through the end of such performance period (except as provided in Section 2.5).

 

(d)                                 Directors’ Deferrals.

 

(1)                                  Cash Retainers.  A Director shall have the right during the
enrollment period established by the Committee to defer up to the Maximum
Deferral Percentage (in whole percentage increments) of his or her cash
retainers for services in the following Plan Year.  Such deferral elections shall relate to a
Director’s cash retainers that would, absent such deferral, have been paid
during such Plan Year (e.g., quarterly
payments of cash retainers that are regularly paid at the end of March, June, September and
December of each Plan Year under Oxford’s compensation practices for Directors,
or otherwise as in effect from time to time). 
Any such election that is not revoked by December 31 following (or
coinciding with) the end of the enrollment period shall become irrevocable (at
the end of the day) on such December 31 and shall remain irrevocable
through the end of the Plan Year for which it is made (except as provided in Section 2.5).

 

(2)                                  Meeting Fees.  A Director shall have the right during the enrollment
period established by the Committee to defer up to the Maximum Deferral Percentage
(in whole percentage increments) of his or her meeting fees for services in the
following Plan Year.  Such 

 

6

 

deferral elections shall relate to a Director’s meeting fees that would,
absent such deferral, have been paid during such Plan Year (e.g., payments of meeting fees that are regularly made in
connection with each meeting of the Board or a committee thereof in accordance
with Oxford’s compensation practices for Directors, or otherwise as in effect
from time to time).  Any such election
that is not revoked by December 31 following (or coinciding with) the end
of the enrollment period shall become irrevocable (at the end of the day) on
such December 31 and shall remain irrevocable through the end of the Plan
Year for which it is made (except as provided in Section 2.5).

 

Section 2.3.                                           Minimum Deferral Amount.  An Eligible Employee’s deferral elections for
a Plan Year must provide for a deferral at least equal to the Minimum Deferral
Amount for the Eligible Employee for that Plan Year (prorated for a start-up
election pursuant to Section 2.1 or upon Separation from Service during a
Plan Year).

 

Section 2.4.                                           Ongoing Election.  A deferral election made in accordance with
Sections 2.1 or 2.2 shall remain in effect for a subsequent Plan Year (or
subsequent performance period in the case of a “performance-based compensation”
deferral) unless revised or revoked during the enrollment period for such Plan
Year or performance period, unless the Committee requires a new election.

 

Section 2.5.                                           Effect of Hardship Withdrawal.  An Eligible Participant who has taken a
hardship withdrawal pursuant to Section 7.2(d), or has taken a hardship
withdrawal pursuant to the 401(k) Plan, shall have his or her deferral
election under this Plan automatically cancelled effective immediately upon
such withdrawal and for the remainder of the Plan Year and performance period,
or for the remainder of the Plan Year and any subsequent Plan Year and
performance period in which deferrals under the 401(k) Plan are
suspended.  Such Eligible Participant may
recommence participation in the Plan only during an annual enrollment period or
a Performance-based Election Period and his or her election shall not become
effective until the beginning of the following Plan Year or, with respect to
the deferral of “performance-based compensation,” the applicable performance
period.

 

Section 2.6.                                           Form of Elections.  Any deferral election shall be made in the
form and manner provided by the Committee for this purpose and in accordance
with such other rules and procedures as may be established from time to
time by the Committee.

 

ARTICLE III

 

MATCHING
CONTRIBUTIONS

 

Unless otherwise determined by the Committee, Oxford
shall credit the Account of each Eligible Employee who elects to defer the
Minimum Deferral Amount for a Plan Year with a Matching Contribution equal to
2% of his or her Excess Compensation for such Plan Year.  (Matching Contributions do not apply with
respect to Directors).

 

ARTICLE IV

 

DISCRETIONARY
CONTRIBUTIONS

 

The Committee may credit each Eligible Employee’s
Account with a Discretionary Contribution, if any, at such times and in such
amounts as recommended by the Committee and approved by the Nominating,
Compensation & Governance Committee of the Board, or the Board, in its
sole discretion.  (Discretionary
Contributions do not apply with respect to Directors).

 

7

 

ARTICLE
V

 

ACCOUNT
ADJUSTMENTS

 

Section
5.1.                                           General.  An Eligible Participant’s
benefit under this Plan shall be based entirely on the dollar value credited to
his or her Account at any time, which will depend upon the amount deferred
under Article II, any Matching Contributions credited under Article III, any
Discretionary Contributions credited under Article IV, and the phantom
investment adjustments made in accordance with this Article V.

 

Section
5.2.                                           Deferrals.  Amounts deferred by an Eligible
Participant shall be credited to his or to her Account as soon as practicable
after the date that such Eligible Compensation otherwise would have been
payable to the Eligible Participant if no election had been made under Article
II.

 

Section
5.3.                                           Matching and Discretionary Contributions.  The Matching Contribution and Discretionary
Contribution, if any, shall be credited to an Eligible Employee’s Account as of
the end of the calendar year, or at such time as otherwise may be determined by
the Committee in its absolute discretion.

 

Section
5.4.                                           Phantom Investments.  The Committee from time to time
shall select one or more investment funds that will serve as hypothetical
investment options for the deferrals, Matching Contributions and Discretionary
Contributions credited to an Account (“phantom investment funds”).  The Committee may establish limits on the
portion of an Account that may be invested hypothetically in any phantom
investment fund or in any combination of phantom investment funds.

 

Section
5.5.                                           Phantom Investment Election.  Each Eligible Participant shall elect
pursuant to procedures established by the Committee to treat the amounts
credited to his or her Account as if they were invested in one or more phantom
investment funds (a “phantom investment election”).  An Eligible Participant may change his or her
phantom investment elections in accordance with the Committee’s
procedures.  Any phantom investment
election shall be effective only if made in accordance with the Committee’s
procedures.

 

Section
5.6.                                           Phantom Investment Adjustments.  The Committee shall cause the Eligible
Participant’s Account to be adjusted from time to time for any earnings and
losses as if it were invested in accordance with the Eligible Participant’s
phantom investment elections.  Such
adjustments shall be made until his or her Account is distributed in full under
Article VII.

 

ARTICLE
VI

 

VESTING

 

Section
6.1.                                           Amounts Deferred.  An Eligible Participant shall be 100% vested
at all times in the Eligible Participant’s deferrals and the earnings thereon.

 

Section
6.2.                                           Matching Contributions.  An Eligible Employee’s Matching
Contributions, and earnings thereon, shall be 100% vested at all times, unless
otherwise determined by the Committee prior to crediting to the Eligible
Employee’s Account.

 

Section
6.3.                                           Discretionary Contributions.  An Eligible Employee’s Discretionary
Contributions, and earnings thereon, shall become vested as determined by the
Committee and as approved by the Nominating, Compensation & Governance
Committee of the Board, or the Board.

 

8

 

ARTICLE
VII

 

DISTRIBUTIONS

 

Section
7.1.                                           Distribution Elections.

 

(a)                                  General.  At the same time as an Eligible Participant
makes a deferral election under Article II, he or she shall elect, pursuant to
Section 7.2, the time as of which contributions credited to his or her Account
for such Plan Year (adjusted as provided under Article V) will be distributed
and, pursuant to Section 7.3, the form in which such distribution will be made.

 

(b)                                 Ongoing Election.  In the absence of any contrary rule
established by the Committee before the applicable Election Period, a
Separation from Service distribution election shall remain in effect for
contributions credited to an Account for a subsequent Plan Year (or subsequent
performance period in the case of a “performance-based compensation” deferral),
unless revised or revoked during the Election Period for such Plan Year or the
Performance-based Election Period.  An
in-service distribution election will apply only to the Plan Year or
performance period with respect to which the election was made and will not
apply to a subsequent Plan Year or performance period.

 

(c)                                  Default.  If an Eligible Participant fails to make an
election as to the time or form of distribution of his or her Account (or
subaccount, as applicable), his or her distribution will be made in a lump sum
in the first calendar month that begins 6 months after the date of his or her
Separation from Service.

 

Section
7.2.                                           Time of Distribution.  Distribution of an Eligible Participant’s
Account (or subaccount, as applicable) may be made as a result of the Eligible
Participant’s Separation from Service, death, the occurrence of a hardship due
to an unforeseeable emergency, or at a specified time while the Eligible
Participant is still an Employee or a Director.

 

(a)                                  Separation from Service.  If distribution is made as a result of the
Eligible Participant’s Separation from Service, it will be made or commence in
the first calendar month that begins (1) 6 months or 12 months (as
selected by the Eligible Participant) after the date the Eligible Participant
Separates from Service, if the Separation from Service is after Retirement Age,
or (2) 6 months after the date the Eligible Employee Separates from
Service, if the Separation from Service is before Retirement Age.  If distribution is to be made in annual
installments, any subsequent annual installments shall be made in February of
the applicable year.

 

(b)                                 Death.  If an Eligible Participant dies before
distributions commence, distribution will be made in the first month of the
calendar quarter immediately following the quarter in which his or her death
occurred.  If an Eligible Participant
dies after distributions have commenced pursuant to his or her Separation from
Service or paragraph (c) below, the balance, if any, of his or her Account will
be distributed in the first month of the calendar quarter immediately following
the quarter in which his or her death occurred.

 

(c)                                  In-Service.  An Eligible Participant may elect that his or
her subaccount for a Plan Year or performance period be distributed or commence
to be distributed in February of any calendar year that begins at least 2 years
after the end of the Plan Year for which the deferrals were credited to such
subaccount; provided he or she is an Employee or a Director on the date of the
distribution.  An Eligible Participant
may revise such in-service distribution election to change the time of distribution;
provided, however, that (1) the revision will not take effect until 12 months
after the date it is made, (2) the revision must be made at least 12 months
before the in-service distribution otherwise would commence, and (3) the
in-service distribution will be deferred for at least 5 years from the date the
in-service distribution would have commenced in the absence of the revision.

 

9

 

(d)                                 Hardship Withdrawal due to Unforeseeable Emergency.  An Eligible Participant shall
have the right to request that the Committee distribute all, or a part of, his
or her Account to him or to her in a lump sum if he or she experiences severe
financial hardship resulting from an illness or accident of the Eligible
Participant, the spouse of the Eligible Participant or a dependent (as defined
in Section 152 of the Code, without regard to subsections (b)(1), (b)(2) and
(d)(1)(B) thereof) of the Eligible Participant, loss of the Eligible
Participant’s property due to casualty, or other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of the Eligible
Participant (an “unforeseeable emergency”). 
The Committee shall have the sole discretion to determine whether to
grant an Eligible Participant’s withdrawal request under this Section 7.1(d)
and the amount to distribute to the Eligible Participant; provided, however,
that no distribution shall be made to an Eligible Participant under this
Section 7.1(d) to the extent that such hardship is or may be relieved (1) through
reimbursement or compensation by insurance or otherwise, (2) by
liquidation of the Eligible Participant’s assets, to the extent the liquidation
of the Eligible Participant’s assets would not itself cause severe financial
hardship, or (3) by a permissible cessation of deferral elections under this
Plan.  The amount of any distributions
from an Eligible Participant’s Account pursuant to this Section 7.1(d) shall be
limited to the amount necessary to meet the unforeseeable emergency, plus
amounts necessary to pay taxes reasonably anticipated as a result of the
distribution.  An Eligible Participant
who takes a hardship withdrawal under this Section 7.1(d) will be ineligible to
make deferrals under the Plan for the remainder of the Plan Year and
performance period.  Distribution shall
be made in the calendar month following the determination by the Committee that
a hardship withdrawal will be permitted.

 

(e)                                  Delay of Payments Under Certain Circumstances.  Notwithstanding the provisions
of paragraph (a) through (d) above, to the extent permitted by Section 409A of
the Code, Oxford, in its discretion, may delay payment to a date after the
payment date designated in such paragraphs under any of the following
circumstances:

 

(1)                                  Payments that Would Jeopardize Oxford and its Subsidiaries as a Going
Concern.  Payment
will be delayed where the Committee determines that the making of the payment
at the time specified under the Plan would jeopardize the ability of Oxford and
its subsidiaries to continue as a going concern; provided that such delayed
payment will be made during the first taxable year of Oxford in which the
making of the payment will not have such effect.

 

(2)                                  Payments that Would Violate Federal Securities Laws or Other Applicable
Law.  Payment
will be delayed where the Committee reasonably anticipates that the making of
the payment will violate federal securities laws or other applicable law;
provided that the delayed payment is made at the earliest date at which the
Committee reasonably anticipates that the making of the payment will not cause
such violation.

 

(3)                                  Payments Subject to Section 162(m).  Payment to an Eligible Participant may be
delayed to the extent that Oxford reasonably anticipates that if the payment
were made as scheduled, Oxford’s deduction with respect to such payment would
not be permitted due to the application of Section 162(m) of the Code; provided
that the payment is made either during the Eligible Participant’s first taxable
year in which Oxford reasonably anticipates, or should reasonably anticipate,
that if the payment is made during such year, the deduction of such payment
will not be barred by application of Section 162(m) of the Code or during the
period beginning with the date of the Eligible Participant’s Separation from
Service and ending on the later of the last day of the taxable year of Oxford
in which the Eligible Participant Separates from Service or the 15th day of the third month following
the Eligible Participant’s Separation from Service; provided further that where
any scheduled payment to a specific Eligible Participant in a taxable year of
Oxford is delayed in accordance with this Section 7.2(e)(3), all scheduled
payments to such Eligible Participant that could be delayed in accordance with
this Section 7.2(e)(3) also will be delayed.

 

10

 

Section
7.3.                                           Distribution Forms.

 

(a)                                  Separation from Service After Retirement Age.  An Eligible Participant may
elect that if he or she Separates from Service after Retirement Age, his or her
subaccount for a Plan Year shall be distributed in a lump sum or annual
installments over 2 to 15 years. 
Notwithstanding anything in this paragraph (a) to the contrary, if the
Eligible Participant’s Account balance following Separation from Service is
less than $25,000, then the Account will be distributed in a lump sum, rather
than installments.

 

(b)                                 Separation from Service Before Retirement Age or Death.  If an Eligible Employee
Separates from Service before Retirement Age or if any Eligible Participant
dies before his or her entire Account is distributed, his or her entire Account
will be distributed in a lump sum, regardless of whether in-service
distributions have commenced pursuant to Section 7.2(c).

 

(c)                                  In-Service.  An Eligible Participant may elect that an
in-service distribution be paid in a lump sum or in annual installments over 2
to 5 years.  An Eligible Participant may
revise such in-service distribution election to change the form of distribution;
provided, however, that (1) the revision will not take effect until 12 months
after the date it is made, (2) the revision must be made at least 12 months
before the in-service distribution otherwise would commence, and (3) the
in-service distribution will be deferred for at least 5 years from the date the
in-service distribution would have commenced in the absence of the
revision.  If the Eligible Participant
Separates from Service before Retirement Age or dies, his or her Account will
be distributed in accordance with Section 7.3(b) and not this Section 7.3(c),
even if distributions had commenced under this Section 7.3(c).  However, if the Eligible Participant
Separates from Service after Retirement Age, then distribution of any
subaccount that had commenced under this Section 7.3(c) shall continue to be
paid as scheduled, but payment of any subaccounts that had not commenced under
this Section 7.3(c) shall be made in accordance with the form elected in
Section 7.3(a).

 

(d)                                 Installments.  The amount of any installment distributable
under this Section 7.3 shall be computed by multiplying the portion of the
Eligible Participant’s Account (or subaccount, as applicable) to be distributed
in installments by a fraction, the numerator of which shall be one and the
denominator of which shall be the number of installments remaining after such
installment has been paid plus one.

 

Section
7.4.                                           Beneficiary.  An Eligible Participant shall
designate (on a form provided for this purpose) a person, or more than one
person, as his or her Beneficiary to receive the balance credited to his or her
Account in the event of his or her death. 
An Eligible Participant may change his or her Beneficiary designation at
any time.  If no Beneficiary designation
is in effect on the date an Eligible Participant dies or if no designated
Beneficiary survives the Eligible Participant, the Eligible Participant’s
estate automatically shall be treated as his or her Beneficiary under this
Plan.

 

ARTICLE
VIII

 

NO
FUNDING OBLIGATION

 

The obligation of the Company to make any distributions
under this Plan shall be unfunded and unsecured; all distributions to, or on
behalf of, an Eligible Participant under this Plan shall be made from the
general assets of the Company, and any claim by an Eligible Participant or
Beneficiary against the Company for any distribution under this Plan shall be
treated, with respect to a Director, the same as a claim of any general and
unsecured creditor of Oxford, or with respect to an Eligible Employee, the same
as a claim of any general and unsecured creditor of Oxford or any other Company
by whom the Eligible Employee was employed. 
Notwithstanding the foregoing, Oxford may, in its discretion, establish
one or more irrevocable grantor trusts for the purpose of funding all or part
of the obligations under this Plan; provided, however, that the terms of any
such trusts require that the assets thereof remain subject to the 

 

11

 

claims of Oxford’s and the other Company’s judgment
creditors and are non-assignable and non-alienable by any Eligible Participant
or Beneficiary prior to distribution thereof.

 

ARTICLE
IX

 

COMPLIANCE
WITH CODE SECTION 409A

 

Oxford intends that this Plan meet the requirements of
Section 409A(a)(2), (3) and (4) of the Code (and any successor provisions of
the Code) and the regulations and other guidance issued thereunder (the “Requirements”)
and be operated in accordance with such Requirements so that compensation
deferred under this Plan (and applicable investment earnings) shall not be
included in income under Section 409A of the Code.  Any ambiguities in this Plan shall be
construed to effect the intent as described in this Article IX.  If any provision of this Plan is found to be
in violation of the Requirements, then such provision shall be deemed to be
modified or restricted to the extent and in the manner necessary to render such
provision in conformity with the Requirements, or shall be deemed excised from
this Plan, and this Plan shall be construed and enforced to the maximum extent
permitted by the Requirements as if such provision had been originally
incorporated in this Plan as so modified or restricted, or as if such provision
had not originally been incorporated in this Plan, as the case may be.

 

ARTICLE
X

 

MISCELLANEOUS

 

Section
10.1.                                     Medium of Payment.  All distributions under this Plan shall be
made in cash.

 

Section
10.2.                                     Making and Revoking Elections and Designations.  Any election or designation or revised
election or designation under this Plan shall be effective only when the properly
completed election or designation form is received by the Committee or its
delegate before the Eligible Participant’s death, subject to the rules set
forth in this Plan.

 

Section
10.3.                                     Statements.  Oxford or its agent shall
provide periodic statements to the Eligible Participant to show his or her
Account balance.

 

Section
10.4.                                     Claims Procedure.  Any claim for a benefit under
this Plan shall be filed and resolved in accordance with the claims procedure
provided under the 401(k) Plan, which procedure hereby is incorporated in this
Plan by reference, except that (a) the Committee of this Plan shall be the
entity with whom a claim for review should be filed under this Plan and (b) the
Committee has absolute discretion to resolve any claims under this Plan.

 

Section
10.5.                                     Withholding.  The Company may take whatever action that the
Company deems appropriate to satisfy applicable federal, state and local income
tax withholding requirements that the Company determines applicable under this
Plan.

 

Section
10.6.                                     No Liability.  No Eligible Participant and no
Beneficiary of an Eligible Participant shall have the right to look to, or have
any claim whatsoever against, any officer, director, employee or agent of the
Company in his or her individual capacity for the distribution of any Account.

 

Section
10.7.                                     Nonalienation of Benefits.  No benefit or payment under this Plan shall
be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, levy or charge, and any attempt so to
anticipate, alienate, sell, transfer, assign, pledge, encumber, levy upon or
charge the same shall be void.

 

12

 

Section
10.8.                                     Plan Administration. The Committee shall be the administrator of this Plan, and the
Committee has the exclusive responsibility and complete discretionary authority
to control the operation, management and administration of this Plan, with all
powers necessary to enable it properly to carry out those responsibilities,
including (but not limited to) the power to construe this Plan, to determine
eligibility for benefits, to settle disputed claims and to resolve all
administrative, interpretive, operational, equitable and other questions that
arise under this Plan.  The decisions of
the Committee on all matters within the scope of its authority shall be final
and binding.  To the extent a
discretionary power or responsibility under this Plan is expressly assigned to
a person by the Committee, that person will have complete discretionary authority
to carry out that power or responsibility and that person’s decisions on all
matters within the scope of that person’s authority will be final and
binding.  Notwithstanding the foregoing,
no Eligible Participant shall participate in any determination that relates
solely or primarily to his or her own Account.

 

Section
10.9.                                     Construction.  This Plan shall be construed in
accordance with the laws of the State of Georgia.  Headings and subheadings have been added only
for convenience of reference and shall have no substantive effect
whatsoever.  All references to the
singular shall include the plural and all references to the plural shall
include the singular.

 

Section
10.10.                               No Contract of Employment.  Nothing contained in this Plan shall be
construed as a contract of employment between the Company and an Eligible
Participant, as a right of any Eligible Employee to be continued in the
employment of the Company, as a right of any Director to remain on the Board,
or as a limitation of the otherwise applicable rights of the Company to
discharge an Eligible Employee with or without cause, or to cause a Director’s
service on the Board to end.

 

Section
10.11.                               ERISA.  Oxford intends that this Plan
come within the various exceptions and exemptions to ERISA for a plan
maintained for a “select group of management or highly compensated employees”
as described in Sections 201(2), 301(a)(3), and 401(a)(1) of ERISA.  Any ambiguities in this Plan shall be
construed to affect the intent as described in this Section 10.11.

 

Section
10.12.                               Amendment and Termination.  The Nominating, Compensation & Governance
Committee of the Board, or the Board, shall have the right to amend this Plan
from time to time and to terminate this Plan at any time; provided, however,
that (a) the balance credited to each Account immediately after any such
amendment or termination shall be no less than the balance credited to such
Account immediately before such amendment or termination (as adjusted for
phantom investment fund performance), (b) the Nominating, Compensation &
Governance Committee, or the Board, may accelerate the distribution of Account
balances under this Plan upon termination to the extent permissible under
Section 409A of the Code, and (c) except to conform to the requirements of Section
409A of the Code, no amendment or termination shall adversely affect an
Eligible Participant’s right to the distribution of his or her Account or his
or her Beneficiary’s right to the distribution of such Account.

 

Section
10.13.                               Pre-2005 Oxford Plan.

 

(a)                                  Pre-2005 Deferrals.  The Pre-2005 Oxford Plan and any liabilities
thereunder were made a part of this Plan effective as of January 1, 2006.  Any amounts deferred before January 1, 2005
under the Pre-2005 Oxford Plan (as determined in accordance with Section 409A
of the Code) shall be governed by the terms of the Pre-2005 Oxford Plan, which
is attached to this Plan as Exhibit A. 
Nothing herein is intended to give any additional benefits to or enhance
the benefits of a participant in the Pre-2005 Oxford Plan and it is intended
that amounts deferred under that plan (and any earnings on such amounts) are
not subject to Section 409A of the Code. 
There shall be no further deferrals under the terms of the Pre-2005 Oxford
Plan after December 31, 2004.

 

13

 

(b)                                 Post-2004 and Pre-2006 Deferrals.  The Pre-2005 Oxford Plan was amended to
comply with Section 409A of the Code in the form of the addendum attached to
this Plan as Exhibit B with respect to amounts deferred in taxable years
beginning after December 31, 2004 and before January 1, 2006.

 

Section
10.14.                               Tommy Bahama Plan.

 

(a)                                  Pre-2005 Deferrals.  The Tommy Bahama Plan and any liabilities
thereunder were made a part of this Plan effective as of January 1, 2006.  Any amounts deferred before January 1, 2005
under the Tommy Bahama Plan (as determined in accordance with Section 409A of
the Code) shall be governed by the terms of the Tommy Bahama Plan, which is
attached to this Plan as Exhibit C. 
Nothing herein is intended to give any additional benefits to or enhance
the benefits of a participant in the Tommy Bahama Plan and it is intended that
amounts deferred under that plan (and any earnings on such amounts) are not
subject to Section 409A of the Code. There shall be no further deferrals under
the terms of the Tommy Bahama Plan after December 31, 2004.

 

(b)                                 Post-2004 and Pre-2006 Deferrals.  The Tommy Bahama Plan was amended to comply
with Section 409A of the Code in the form of the addendum attached to this Plan
as Exhibit D with respect to amounts deferred in taxable years beginning after
December 31, 2004 and before January 1, 2006.  Each Deferred Compensation Account maintained
under the Tommy Bahama Plan for a person who was an active Employee on January
1, 2006 became fully vested as of January 1, 2006.

 

Section
10.15.                               Special Transition Bonus Election.  Notwithstanding any contrary provision in the
Plan, the Committee was authorized in its discretion to allow an Eligible
Employee to elect during 2007 (in accordance with procedures established by the
Committee and in compliance with transition guidance provided under IRS Notice
2006-79) to defer up to the Maximum Deferral Percentage of any bonus
attributable to a performance period beginning in 2007 that otherwise would be
a short-term deferral (within the meaning of Section 409A of the Code) payable
in 2007 or 2008.

 

IN WITNESS WHEREOF, Oxford Industries, Inc. has caused
this Plan document to be executed as of this 31st day of August, 2010.

 

 

	
  ATTEST:

  	
   

  	
  OXFORD INDUSTRIES, INC.  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Suraj A. Palakshappa

  	
   

  	
  /s/ Thomas E. Campbell

  
	
   

  	
   

  	
   

  
	
  By:  Suraj A.
  Palakshappa, Asst. Secretary

  	
   

  	
  By:  Thomas E.
  Campbell, Vice President

  

 

14

 

EXHIBIT A

 

OXFORD INDUSTRIES, INC.

 

NON-QUALIFIED DEFERRED
COMPENSATION PLAN

 

A-1

 

OXFORD INDUSTRIES, INC.

 

NON-QUALIFIED DEFERRED
COMPENSATION PLAN

 

ARTICLE I - PURPOSE; EFFECTIVE
DATE

 

1.1.                              Purpose.  The purpose of this Oxford Industries, Inc.
Non-Qualified Deferred Compensation Plan (the “Plan”) is to permit a select
group of management and highly compensated employees of Oxford Industries, Inc.
and its subsidiaries (the “Company”) to defer the receipt of income which would
otherwise become payable to them.  It is
intended that this Plan, by providing this deferral opportunity, will assist
the Company in attracting and retaining individuals of exceptional ability.

 

1.2.                              Effective Date.  The Plan shall be effective as of January 1,
2001.

 

ARTICLE II - DEFINITIONS

 

For the purpose of this Plan, the following terms shall
have the meanings indicated unless the context clearly indicates otherwise:

 

2.1.                              Account(s).  “Account(s)” means the account or accounts maintained
on the books of the Company used solely to calculate the amount payable to each
Participant under this Plan and shall not constitute a separate fund or
assets.  The Accounts available for each
Participant shall be identified as:

 

a)                                      Retirement Account and/or,

 

b)                                     Up to two In-Service Accounts.

 

2.2.                              Beneficiary.  “Beneficiary” means the person, persons or
entity, as designated by the Participant, entitled under Article VI to receive
any Plan benefits payable after the Participant’s death.

 

2.3.                              Board.  “Board” means the Board of Directors of the
Company.

 

2.4.                              Change in Control.  A “Change in Control” shall
occur if:

 

a)                                      Any “person” or “group” (within the meaning of Sections 13(d) and
14(d)(2) of the Securities Exchange Act of 1934, as amended) becomes the “beneficial
owner” (as defined in Rule 13-d under such Act) of more than fifty (50%) of the
then outstanding voting stock of the Company, other than through a transaction
arranged by, or consummated with the prior approval of, the Board; or

 

b)                                     During any period of two (2) consecutive years, individuals who at the
beginning of such period constitute the Board (and any new Director whose
election by the Board or whose nomination for election by the stockholders of
the Company was approved by a vote of at least two-thirds (2/3) of the
Directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority thereof; or

 

A-2

 

c)                                      The shareholders of Company approve a merger or consolidation of Company
with any other corporation, other than a merger or consolidation which would
result in the voting securities of a Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) more than eighty
percent (80%) of the combined voting power of the voting securities of Company
or such surviving entity outstanding immediately after such merger or
consolidation; or

 

d)                                     The shareholders of Company approve a plan of complete liquidation of
Company or an agreement for the sale or disposition by Company of all or
substantially all of the Company’s assets.

 

2.5.                              Committee.  “Committee” means the Committee appointed by
the Board to administer the Plan pursuant to Article VII.

 

2.6.                              Company.  “Company” means Oxford Industries, Inc., a
Georgia corporation, and any directly or indirectly affiliated subsidiary
corporations, any other affiliate which is designated by the Board, or any
successor to the business thereof.

 

2.7.                              Compensation.  “Compensation” means the base salary,
commissions and/or bonus compensation payable to a Participant with respect to
employment services performed for the Company by the Participant and Company
matching contributions that would otherwise be included in “wages” for purposes
of federal income tax withholding.  For
purposes of this Plan, Compensation shall be calculated before reduction for
any amounts deferred by the Participant pursuant to the Company’s tax qualified
plans which may be maintained under Section 401(k) or Section 125 of the
Internal Revenue Code of 1986, as amended, (the “Code”), or pursuant to this
Plan or any other non-qualified plan which permits the voluntary deferral of
compensation.  Inclusion of any other
forms of compensation is subject to Committee Approval.

 

2.8.                              Deferral Commitment.  “Deferral Commitment” means a
commitment made by a Participant and accepted by the Committee to defer a
portion of Compensation paid to or earned such Participant during a specified
Deferral Period.  The Deferral Commitment
shall apply to each payment of salary and/or bonus, as applicable, earned by or
payable to a Participant for a given Deferral Period, and shall specify the
Account or Accounts to which such deferrals shall be credited.  Such designation shall be made in whole
percentages and shall be made in a form acceptable to the Committee.  Once made, a Deferral Commitment shall,
except as otherwise provided herein, be irrevocable by the Participant for the
Deferral Period to which it applies.

 

2.9.                              Deferral Period.  “Deferral Period” means a calendar year to
which a Deferral Commitment applies.

 

2.10.                        Determination Date.  “Determination Date” means the
last business day of each calendar month.

 

2.11.                        Disability.  “Disability” means a physical or mental
condition that prevents the Participant from satisfactorily performing the
Participant’s duties for Company.  The
Committee shall, in its sole discretion, determine the existence of Disability
and may rely on such evidence of disability as it deems appropriate, including
a determination of disability under the Company’s long-term disability plan or
advice from a medical examiner satisfactory to the Committee.

 

2.12.                        Discretionary Contribution.  “Discretionary Contribution”
means the Company contribution credited to a Participant’s Account(s) under
Section 4.5, below.

 

A-3

 

2.13.                        Distribution Election.  “Distribution Election” means
the form prescribed by the Committee and completed by the Participant,
indicating the chosen form of payment for benefits payable from each Account
under this Plan, as elected by the Participant.

 

2.14.                        Financial Hardship.  “Financial Hardship” means a
severe, unexpected and unforeseeable financial hardship of the Participant
resulting from a Disability of the Participant, a sudden and unexpected illness
or accident of the Participant or of a dependent of the Participant, uninsured
loss of the Participant’s property due to casualty, or other similar
extraordinary and unforeseeable circumstance arising as a result of events
beyond the control of the Participant. 
Financial Hardship shall be determined based upon such standards as are,
from time to time, established by the Committee, and such determination shall
be in the sole discretion of the Committee.

 

2.15.                        401(k) Plan.  “401(k) Plan” means the Oxford Industries,
Inc. Retirement Savings Plan, or any other successor defined contribution plan
maintained by the Company that qualifies under Section 401(a) of the Code and
satisfies the requirements of Section 401(k) of the Code.

 

2.16.                        Investment Option.  “Investment Option” means one or
more of the independently established funds or indices that are identified and
listed by the Committee.  These
Investment Options are used solely to calculate the investment gains or losses
that are credited to each Participant’s Account(s) in accordance with Article
IV.  The determination of the investment
gains or losses attributable to the performance of each Investment Option shall
be made by the Committee in its reasonable discretion.  The Committee shall select and provide a list
of the various Investment Options available to the Participants with respect to
this Plan; provided, that the Committee may amend such list from time to time
in its sole discretion.

 

2.17.                        Matching Contribution.  “Matching Contribution” means
the Company contribution credited to a Participant’s Account(s) under Section
4.4, below.

 

2.18.                        Participant.  “Participant” means any employee who is
eligible pursuant to Section 3.1 to participate in this Plan and who has
elected to defer Compensation under this Plan in accordance with Article
III.  Such employee shall remain a Participant
in this Plan for the period of deferral and until such time as all benefits
payable under this Plan have been paid in accordance with the provisions
hereof.

 

2.19.                        Plan.  “Plan” means this Oxford Industries, Inc.
Non-Qualified Deferred Compensation Plan, as amended from time to time.

 

2.20.                        Retirement.  “Retirement” means the termination of
employment with the Company of the Participant on or after attaining age 65 or
on or after attaining age 55 with at least 7 Years of Service, or a termination
of employment that has received the approval by the Committee as qualifying as
a Retirement under this Plan.

 

2.21.                        Years of Service.  “Years of Service” shall have
the meaning provided for such term for purposes of vesting under the 401(k)
Plan, whether or not the Participant is a participant in such plan.

 

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ARTICLE III - ELIGIBILITY AND
PARTICIPATION

 

3.1.                              Eligibility and Participation.

 

a)                                      Eligibility.  Eligibility to participate in the Plan for a
Deferral Period shall be limited to a select group of management or highly
compensated employees of the Company designated by management, from time to
time, and approved by the Committee.

 

b)                                     Participation.  An employee’s participation in the Plan for a
Deferral Period shall be effective upon notification to the employee by the
Committee of eligibility to participate, completion and submission of a
Deferral Commitment,  Distribution
Election Form and Investment Allocation Form to the Committee no later than the
deadline established by the Committee, and the acceptance by the Committee of
such forms.

 

3.2.                              Form of Deferral. A Deferral Commitment shall be made with respect to each payment of
salary, commissions and/or bonus earned by or payable to a Participant during
the Deferral Period, and shall designate the portion of each deferral that
shall be allocated among the various Accounts. 
The Participant shall set forth the amount to be deferred as a full
percentage of salary, commission and/or bonus. 
In addition, the Participant shall specify in a separate form (known as
the “Investment Allocation Form”) filed with the Committee, the Participant’s
initial allocation of the amounts deferred into each Account among the various
available Investment Options.

 

3.3.                              Limitations on Deferral Commitments.  The maximum percentage of each
payment of base salary and commissions that may be deferred during a Deferral
Period shall be fifty percent (50%), and the maximum percentage of bonus
compensation that may be deferred during the Deferral Period shall be one
hundred percent (100%).  The Committee
may set such additional limitations for a Deferral Period, as it determines in
its sole discretion, once it has reviewed the participation level for such
Deferral Period.

 

3.4.                              Commitment Limited by Termination.  If a Participant terminates
employment with Company prior to the end of a Deferral Period, the Deferral
Commitment in effect for such Deferral Period shall be revoked as of the date
of such termination.

 

3.5.                              Modification of Deferral Commitment.  Except as provided in Sections
3.4 and 5.5, a Deferral Commitment for a Deferral Period shall be irrevocable
by the Participant during such Deferral Period.

 

3.6.                              Change in Employment Status.  If the Committee, in its sole
discretion, determines that the Participant no longer qualifies as a member of
a select group of management or highly compensated employees, as determined in
accordance with the Employee Retirement Income Security Act of 1974, as
amended, the Committee may, in its sole discretion, terminate any Deferral
Commitment currently in effect, prohibit the Participant from making any future
Deferral Commitments and/or distribute the Participant’s Account Balances in
accordance with Article V of this Plan as if the Participant had terminated
employment with the Company as of that time.

 

ARTICLE IV - DEFERRED
COMPENSATION ACCOUNT

 

4.1.                              Accounts.  The Compensation deferred by a Participant
under the Plan, any Matching Contributions deferred under the Plan,
Discretionary Contributions and Earnings shall be credited to the Participant’s
Account(s).  The Participant shall
designate the portion of each deferral that will be 

 

A-5

 

credited to each Account as set forth in Section
3.2(a).  These Accounts shall be used
solely to calculate the amount payable to each Participant under this Plan and
shall not constitute a separate fund of assets.

 

4.2.                              Timing of Credits; Withholding.  A Participant’s deferred
Compensation shall be credited to each Account designated by the Participant on
the last business day of the month during which the compensation deferred would
have otherwise been payable to the Participant. 
Any Matching Contributions shall be credited to each Account on the last
business day of the month during which the deferred Compensation to which the
Matching Contributions relates was credited to each Account.  Any Discretionary Contributions shall be
credited to the appropriate Account(s) as provided by the Committee.  Any withholding of taxes or other amounts
with respect to deferred Compensation that is required by local, state or
federal law shall be withheld from the Participant’s corresponding non-deferred
portion of the Compensation to the maximum extent possible, and any remaining amount
shall reduce the amount credited to the Participant’s Account in a manner
specified by the Committee.

 

4.3.                              Investment Options.  A Participant shall designate,
at a time and in a manner acceptable to the Committee, one or more Investment
Options for each Account to be used for the sole purpose of determining the
amount of Earnings to be credited or debited to such Account.  Such election shall designate the portion of
each deferral of Compensation made into each Account that shall be allocated
among the available Investment Option(s), and such election shall apply to each
succeeding deferral of Compensation until such time as the Participant shall
file a new election with the Committee. Upon notice to the Committee, the
Participant may also reallocate the balance in each Investment Option among the
other available Investment Options as of the next succeeding Determination
Date, but in no event shall such re-allocation occur more frequently than
monthly.

 

4.4.                              Matching Contributions.  The Company shall credit the
portion elected by the Participant of the Company’s total Matching Contribution
on behalf of the Participant to the Account designated by the Participant.

 

4.5.                              Discretionary Contributions.  The Company may make
Discretionary Contributions to a Participant’s Account.  Discretionary Contributions shall be credited
and shall become vested at such times and in such amounts as recommended by the
Committee and approved by the Compensation Committee of the Board, or the Board,
in its sole discretion.  Unless the
Committee specifies otherwise, such Discretionary Contribution shall be
allocated among the various Accounts in the same proportion as set forth in
section 4.1.

 

4.6.                              Determination of Accounts.  Each Participant’s Account as of
each Determination Date shall consist of the balance of the Account as of the
immediately preceding Determination Date, adjusted as follows:

 

a)                                      New Deferrals.  Each Account shall be increased by any
deferrals credited since the prior Determination Date.

 

b)                                     Company Contributions.  Each Account shall be increased
by any Matching and/or Discretionary Contributions credited since the prior
Determination Date.

 

c)                                      Distributions.  Each Account shall be reduced by the amount
of each benefit payment made from that Account since the prior Determination
Date.  Distributions shall be deemed to
have been made proportionally from each of the Investment Options maintained
within such Account based on the proportion that such Investment Option bears
to the sum of all 

 

A-6

 

Investment Options maintained within such Account
for that Participant as of the Determination Date immediately preceding the
date of payment.

 

d)                                     Earnings.  Each Account shall be increased or decreased
by the Earnings credited to such Account since the prior Determination Date as
though the balance of that Account as of the beginning of the current month had
been invested in the applicable Investment Options chosen by the Participant.

 

4.7.                              Vesting of Accounts.  Each Participant shall be vested
in the amounts credited to such Participant’s Account and Earnings thereon as
follows:

 

a)                                      Amounts Deferred.  A Participant shall be one
hundred percent (100%) vested at all times in the Participant’s deferrals of
salary, commission and/or bonus and the Earnings thereon.

 

b)                                     Matching Contributions.  A Participant shall be one
hundred percent (100%) vested at all times in the Matching Contributions made
under the Plan and the Earnings thereon.

 

c)                                      Discretionary Contributions.  A Participant’s Discretionary
Contributions and Earnings thereon shall become vested as determined by the
Committee and as approved by the Compensation Committee of the Board, or the
Board.

 

4.8.                              Statement of Accounts.  Each Participant shall receive a
statement showing the balances in the Participant’s Account on a quarterly
basis.

 

ARTICLE V - PLAN BENEFITS

 

5.1.                              Retirement Account.  The vested portion of a
Participant’s Retirement Account shall be distributed to the Participant upon
the Participant’s termination of employment with the Company.  Benefits under this section shall be payable
the January following termination of employment, but no sooner than thirty (30)
days following termination.  The form of
benefit payment shall be that form selected by the Participant pursuant to
Section 5.6 unless the Participant terminates employment prior to Retirement,
in which event, the Retirement Account shall be paid in the form of a lump sum
payment unless the Committee determines, upon written request, to allow the payment
to be made in the form designation on the Distribution Election Form.

 

5.2.                              In-Service Account. The vested portion of a Participant’s In-Service Account shall be
distributed to the Participant upon the date chosen by the Participant in the
Distribution Election Form, but in no event shall the date specified for
commencement of payment be earlier than five (5) years from the beginning of
the first Deferral Period during which the Participant elected compensation to
be deferred into that Account.  The form
of benefit payment shall be that form selected by the Participant pursuant to
Section 5.7.  However, if the Participant
terminates employment with the Company prior to the date so chosen by the
Participant, the vested portion of the In-Service Account shall be added to the
Retirement Account as of the date of termination of service and shall be paid
in accordance with the provisions of Section 5.1.

 

5.3.                              Death Benefit.  Upon the death of a Participant, Company
shall pay to the Participant’s Beneficiary an amount equal to the remaining
unpaid and vested Account balance in each Account in the form of a lump sum
payment.

 

A-7

 

5.4.                              Hardship Distributions.  Upon a finding that a
Participant has suffered a Financial Hardship, the Committee may, in its sole
discretion, amend the existing Deferral Commitment, or make distributions from
any or all of the Participant’s Accounts. The amount of such distribution shall
be limited to the amount reasonably necessary to meet the Participant’s needs
resulting from the Financial Hardship plus applicable taxes, and shall not
exceed the Participant’s vested Account balances.  If payment is made from any or all of the
Participant’s accounts due to Financial Hardship, the Participant’s deferrals
under this Plan shall cease for the remainder of the current Deferral Period
and the next subsequent Deferral Period.

 

5.5.                              Withdrawal with Penalty.  The Participant may elect, in
the sole discretion of the Participant, to withdraw from participation in this
Plan, and to cause the total vested portion of the Participant’s Account
balances to be distributed in accordance with this Article V as if the
Participant had terminated service with the Company as of the time of such
election, except that such Account balances shall be reduced by a penalty of
ten percent (10%) of such Account Balances. 
The Participant’s account balances, less the 10% penalty, shall be paid
to the Participant or the Participant’s Beneficiary as soon as administratively
practical in the form of a lump sum payment. 
The Participant, or the Participant’s Beneficiary, may file such an
election at any time prior to the complete payment of benefits due under this
Plan.  Upon the filing of this election,
any Deferral Commitment for the current Deferral Period shall be terminated and
the Participant shall be prohibited from participating in this Plan for the
next subsequent Deferral Period.

 

5.6.                              Form of Payment.  Unless otherwise specified in paragraphs 5.1,
5.2, 5.3, or 5.5, the benefits payable from any Account under this Plan shall
be paid in the form of benefit as provided below, and as specified by the
Participant in the Distribution Election, which election shall be irrevocable
once made.  The permitted forms of
benefit payments are:

 

a)                                      A lump sum amount which is equal to the vested Account balance;

 

b)                                     In the event of distributions from the Retirement Account, annual
installments for a period of five (5), ten (10) or fifteen (15) years where the
annual payment shall be equal to the balance of the Account immediately prior
to the payment, multiplied by a fraction, the numerator of which is one (1) and
the denominator of which commences at the number of annual payment initially
chosen and is reduced by one (1) in each succeeding year.  Earnings on the unpaid balance shall be based
on the most recent allocation among the available Investment Options chosen by
the Participant, made in accordance with Section 4.3;

 

c)                                      In the event of distributions from the In-Service Account, annual
installments for a period up to five (5) where the annual payment shall be
equal to the balance of the Account immediately prior to the payment,
multiplied by a fraction, the numerator of which is one (1) and the denominator
of which commences at the number of annual payment initially chosen and is
reduced by one (1) in each succeeding year. 
Earnings on the unpaid balance shall be based on the most recent
allocation among the available Investment Options chosen by the Participant,
made in accordance with Section 4.3; and,

 

d)                                     Any other form of payment requested by the Participant and approved by
the Committee.

 

5.7.                              Small Account.  Except as otherwise determined by the
Committee, if the total of a Participant’s vested, unpaid Account balances as
of the Participant’s Retirement is less than $25,000, the remaining unpaid,
vested Account(s) shall be paid in a lump sum, notwithstanding any election by
the Participant to the contrary.

 

A-8

 

5.8.                              Withholding; Payroll Taxes.  The Company shall withhold from
any payment made pursuant to this Plan any taxes required to be withheld from
such payments under local, state or federal law.

 

5.9.                              Payment to Guardian.  If a Plan benefit is payable to
a minor or a person declared incompetent or to a person incapable of handling
the disposition of the property, the Committee may direct payment to the
guardian, legal representative or person having the care and custody of such
minor, incompetent or person.  The
Committee may require proof of incompetency, minority, incapacity or
guardianship as it may deem appropriate prior to distribution.  Such distribution shall completely discharge
the Committee and Company from all liability with respect to such benefit.

 

5.10.                        Effect of Payment.  The full payment of the
applicable benefit under this Article V shall completely discharge all
obligations on the part of the Company to the Participant (and the Participant’s
Beneficiary) with respect to the operation of this Plan, and the Participant’s
(and Participant’s Beneficiary’s) rights under this Plan shall terminate.

 

ARTICLE VI - BENEFICIARY
DESIGNATION

 

6.1.                              Beneficiary Designation.  Each Eligible Participant shall
have the right, at any time, to designate one (1) or more persons or
entities as Beneficiary (both primary as well as secondary) to whom benefits
under this Plan shall be paid in the event of Participant’s death prior to
complete distribution of the Participant’s vested Account balance.  Each Beneficiary designation shall be in a
written form prescribed by the Committee and shall be effective only when filed
with the Committee during the Participant’s lifetime.

 

6.2.                              Changing Beneficiary.  Any Beneficiary designation may
be changed by the filing of a new Beneficiary designation with the Committee.

 

6.3.                              No Beneficiary Designation.  If any Participant fails to
designate a Beneficiary in the manner provided above, if the designation is
void, or if the Beneficiary designated by a deceased Participant dies before
the Participant or before complete distribution of the Participant’s benefits,
the Participant’s Beneficiary shall be the Participant’s estate.

 

6.4.                              Effect of Payment.  Payment to the Beneficiary shall
completely discharge the Company’s obligations under this Plan.

 

ARTICLE VII - ADMINISTRATION

 

7.1.                              Committee; Duties.  This Plan shall be administered
by the Committee, which shall consist of not less than three (3) persons
appointed by the Board, except after a Change in Control as provided in Section 7.5.  The Committee shall have the authority to
make, amend, interpret and enforce all appropriate rules and regulations
for the administration of the Plan and decide or resolve any and all questions,
including interpretations of the Plan, as may arise in such
administration.  A majority vote of the
Committee members shall control any decision. 
Members of the Committee may be Participants under this Plan.

 

7.2.                              Agents.  The Committee may, from time to time, employ
agents and delegate to them such administrative duties as it sees fit, and may
from time to time consult with counsel who may be counsel to the Company.

 

A-9

 

7.3.                              Binding Effect of Decisions.  The decision or action of the
Committee with respect to any question arising out of or in connection with the
administration, interpretation and application of the Plan and the rules and
regulations promulgated hereunder and with respect to determining eligibility
to participate in the Plan, whether, when and in what amount benefits are
payable under the Plan, and any factual determinations shall made in the
Committee’s sole discretion and shall be final, conclusive and binding upon all
persons.

 

7.4.                              Indemnity of Committee.  The Company shall indemnify and
hold harmless the members of the Committee against any and all claims, loss,
damage, expense or liability arising from any action or failure to act with
respect to this Plan on account of such member’s service on the Committee,
except in the case of gross negligence or willful misconduct.

 

7.5.                              Election of Committee After Change in Control.  After a Change in Control,
vacancies on the Committee shall be filled by majority vote of the remaining
Committee members and Committee members may be removed only by such a
vote.  If no Committee members remain, a
new Committee shall be elected by majority vote of the Participants in the Plan
immediately preceding such Change in control. 
No amendment shall be made to Article VII or other Plan provisions
regarding Committee authority with respect to the Plan without prior approval
by the Committee.

 

ARTICLE VIII - CLAIMS
PROCEDURE

 

8.1.                              Claim.  Any person or entity claiming a benefit,
requesting an interpretation or ruling under the Plan (hereinafter referred to
as “Claimant”), or requesting information under the Plan shall present the
request in writing to the Committee, which shall respond in writing as soon as
practicable.

 

8.2.                              Denial of Claim.  If the claim or request is denied, the
written notice of denial shall state:

 

a)                                      The reasons for denial, with specific reference to the Plan provisions on
which the denial is based;

 

b)                                     A description of any additional material or information required and an
explanation of why it is necessary; and

 

c)                                      An explanation of the Plan’s claim review procedure.

 

8.3.                              Review of Claim.  Any Claimant whose claim or request is denied
or who has not received a response within sixty (60) days may request a review
by notice given in writing to the Committee within sixty (60) days following
such denial or lack of response.  The
claim or request shall be reviewed by the Committee.

 

8.4.                              Final Decision.  The decision on review shall normally be made
within sixty (60) days after the Committee’s receipt of claimant’s claim or
request.  If an extension of time is
required for a hearing or other special circumstances, the Claimant shall be
notified and the time limit shall be one hundred twenty (120) days.  The decision shall be in writing and shall
state the reasons and the relevant Plan provisions.  All decisions on review shall be made in the
Committee’s sole discretion and shall be final and binding on all parties.

 

A-10

 

ARTICLE IX - AMENDMENT
AND TERMINATION OF PLAN

 

9.1.                              Amendment.  The Board may at any time amend the Plan by
written instrument, notice of which is given to all Participants and to
Beneficiaries receiving installment payments, subject to the following;
provided, that no amendment shall reduce the amount accrued in any Account as
of the date such notice of the amendment is given.

 

9.2.                              Company’s Right to Terminate.  The Board may at any time
partially or completely terminate the Plan, as it determines in its sole
discretion.

 

a)                                      Partial Termination.  The Board may partially
terminate the Plan by instructing the Committee not to accept Deferral
Commitments for future Deferral Periods. 
If such a partial termination occurs, the Plan shall continue to operate
and be effective with regard to Deferral Commitments entered into prior to the
effective date of such partial termination.

 

b)                                     Complete Termination.  The Board may completely
terminate the Plan by instructing the Committee not to accept Deferral
Commitments for future Deferral Periods, and by terminating all current
Deferral Commitments.  In the event of
complete termination, the Plan shall cease to operate and Company shall
distribute each Account to the appropriate Participant.  Payment shall be made as a lump sum.

 

ARTICLE X - MISCELLANEOUS

 

10.1.                        Unfunded Plan.  This plan is an unfunded plan maintained
primarily to provide deferred compensation benefits for a select group of “management
or highly-compensated employees” within the meaning of the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”), and therefore is exempt from
the provisions of Parts 2, 3 and 4 of Title I of ERISA.  Accordingly, the Board may take such actions
as it, in its sole discretion, deems appropriate if it is determined by the
United States Department of Labor, a court of competent jurisdiction, or an
opinion of counsel that the Plan constitutes an employee pension benefit plan
within the meaning of Section 3 (2) of ERISA (as currently in effect
or hereafter amended) which is not so exempt.

 

10.2.                        Unsecured General Creditor.  Notwithstanding any other provision
of this Plan, Participants and Participants’ Beneficiary shall be unsecured
general creditors, with no secured or preferential rights to any assets of
Company or any other party for payment of benefits under this Plan.  Any property held by Company for the purpose
of generating the cash flow for benefit payments shall remain its general,
unpledged and unrestricted assets. 
Company’s obligation under the Plan shall be an unfunded and unsecured
promise to pay money in the future.

 

10.3.                        Trust Fund.  Company shall be responsible for the payment
of all benefits provided under the Plan. 
At its discretion, Company may establish one (1) or more trusts,
with such trustees as the Board may approve, for the purpose of assisting in
the payment of such benefits.  Although
such a trust shall be irrevocable, its assets shall be held for payment of all
Company’s general creditors in the event of insolvency.  To the extent any benefits provided under the
Plan are paid from any such trust, Company shall have no further obligation to
pay them.  If not paid from the trust,
such benefits shall remain the obligation of Company.

 

10.4.                        Nonassignability.  Neither a Participant nor any
other person shall have any right to commute, sell, assign, transfer, pledge,
anticipate, mortgage or otherwise encumber, transfer, hypothecate or convey in
advance of actual receipt the amounts, if any, payable hereunder, or any part
thereof, which are, and all rights to which are, expressly declared to be
unassignable and non-transferable.  No
part of 

 

A-11

 

the amounts payable shall, prior to actual
payment, be subject to seizure or sequestration for the payment of any debts,
judgments, alimony or separate maintenance owed by a Participant or any other
person, nor be transferable by operation of law in the event of a Participant’s
or any other person’s bankruptcy or insolvency.

 

10.5.                        Not a Contract of Employment.  This Plan shall not constitute a
contract of employment between Company and the Participant.  Nothing in this Plan shall give a Participant
the right to be retained in the service of Company or to interfere with the
right of the Company to discipline or discharge a Participant at any time.

 

10.6.                        Protective Provisions.  A Participant shall cooperate
with Company by furnishing any and all information requested by Company in
order to facilitate the payment of benefits hereunder and by taking such action
as may be requested by Company.

 

10.7.                        Governing Law.  The provisions of this Plan shall be
construed and interpreted according to the laws of the State of Georgia, except
as preempted by federal law.

 

10.8.                        Validity.  If any provision of this Plan shall be held
illegal or invalid for any reason, said illegality or invalidity shall not affect
the remaining parts hereof, but this Plan shall be construed and enforced as if
such illegal and invalid provision had never been inserted herein.

 

10.9.                        Notice.  Any notice required or permitted under the
Plan shall be sufficient if in writing and hand delivered or sent by registered
or certified mail.  Such notice shall be
deemed given as of the date of delivery or, if delivery is made by mail, as of
the date shown on the postmark on the receipt for registration or
certification.  Mailed notice to the
Committee shall be directed to the company’s primary business address.  Mailed notice to a Participant or Beneficiary
shall be directed to the individual’s last known address in company’s records

 

10.10.                  Successors.  The provisions of this Plan shall bind and
inure to the benefit of Company and its successors and assigns.  The term successors as used herein shall
include any corporate or other business entity which shall, whether by merger,
consolidation, purchase or otherwise acquire all or substantially all of the
business and assets of Company, and successors of any such corporation or other
business entity.

 

 

	
   

  	
  OXFORD INDUSTRIES, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  Thomas E. Campbell

  
	
   

  	
  Title:

  	
  Vice President

  

 

A-12

 

EXHIBIT B

 

PRE-2005 OXFORD PLAN

 

SPECIAL RULES APPLICABLE TO 2005
COMPENSATION

 

Notwithstanding any other provision of the Pre-2005
Oxford Plan to the contrary, the provisions of this Exhibit B shall
supersede all inconsistent provisions of the Pre-2005 Oxford Plan with respect
to amounts deferred in taxable years beginning after December 31, 2004 and
before January 1, 2006 (and earnings on such amounts).  All other provisions of the Pre-2005 Oxford
Plan shall apply with respect to such deferrals to the extent not inconsistent
with the provisions of this Exhibit B or Section 409A of the Code, as
determined by the Committee in its sole and absolute discretion.  This Exhibit B is intended to (a) satisfy
the requirements of Section 409A(a)(2), (3) and (4) of the Code
for deferrals made after December 31, 2004 and before January 1, 2006
and (b) not constitute a material modification of the Pre-2005 Oxford Plan
with respect to amounts deferred before January 1, 2005.

 

1.                                       Account(s).  A separate bookkeeping account shall
be established to account for deferrals made in taxable years beginning after December 31,
2004 and before January 1, 2006 and any earnings on such deferrals.  The portion of any Account that was not fully
vested on December 31, 2004 shall be treated as a deferral made in taxable
years beginning after December 31, 2004.

 

2.                                       Participation.  A Deferral Commitment shall only
apply to defer a portion of Compensation consisting of base salary, commissions
and/or bonus compensation earned by a Participant during the Deferral
Period.  The deadline for completion and
submission of a Deferral Commitment and Distribution Election Form is December 31,
2004.

 

3.                                       Change
in Employment Status.  The provisions of Section 3.6 of the
Pre-2005 Oxford Plan shall not apply.

 

4.                                       Hardship
Distributions.  The provisions of Sections 2.14 and 5.4 of
the Pre-2005 Oxford Plan shall not apply, and Section 7.2(d) of the
Plan shall apply as if incorporated in the Pre-2005 Oxford Plan.

 

5.                                       Distribution
of Retirement Account.  In order for a termination of employment with
the Company to trigger a distribution, the termination of employment must
qualify as a “separation from service” within the meaning of Section 409A
of the Code and the regulations thereunder. 
Distribution upon termination of employment will be made in the form
selected by the Participant, unless the Participant terminates employment prior
to Retirement, in which case the Retirement Account shall be paid in the form
of a lump sum payment, with no Committee discretion to pay in another
form.  A distribution made as a result of
the Participant’s separation from service (whether prior to or upon Retirement)
will commence in the first calendar month that is 6 months from the date the
Participant terminates employment.  “Retirement”
means the separation from service with the Company of the Participant on or
after attaining age 55 with at least 7 Years of Service.

 

6.                                       In-Service
Account.  A
Participant may revise an in-service distribution election to change the time
of distribution; provided, however, that (1) the revision will not take
effect until 12 months after the date it is made, (2) the revision must be
made at least 12 months before the in-service

 

B-1

 

distribution otherwise would commence, and (3) the
in-service distribution will be deferred for at least 5 years from the date the
in-service distribution would have commenced in the absence of the revision.

 

7.                                       Death.  If distribution is made as a
result of the Participant’s death under Section 5.3 of the Pre-2005 Oxford
Plan, distribution will commence in the first month of the calendar quarter
immediately following the quarter in which his or her death occurred.

 

8.                                       Withdrawal
with Penalty.  The provisions of Section 5.5 of the
Pre-2005 Oxford Plan shall not apply.

 

9.                                       Delay
of Payments Under Certain Circumstances.  Section 7.2(e) of the Plan shall
apply as if incorporated in the Pre-2005 Oxford Plan.

 

10.                                 Amendment
and Complete  Termination.  The provisions of Sections 9.1 and 9.2(b) of
the Pre-2005 Oxford Plan shall not apply, and Section 10.12 of the Plan
shall apply as if incorporated in the Pre-2005 Oxford Plan.

 

B-2

 

EXHIBIT C

 

VIEWPOINT INTERNATIONAL, INC.

 

NONQUALIFIED DEFERRED
COMPENSATION PLAN

 

C-1

 

NONQUALIFIED DEFERRED
COMPENSATION PLAN

 

SECTION 1

Definitions

 

1.1. Affiliate. “Affiliate” means any
corporation, partnership, joint venture, association or similar organization or
entity that is required to be aggregated with the Company pursuant to Code
Sections 414(b), (c), or (m).

 

1.2. Code. “Code” means the Internal Revenue Code
of 1986, as amended from time to time. Any reference to a section of the Code
includes any comparable section or sections of any future legislation that
amends, supplements or supersedes that section.

 

1.3. Company. “Company” means Viewpoint
International, Inc. located at 1071 Avenue of the Americas, NY, NY 10018,
employer tax identification number 13-3676108, which Company has established
the Plan, as set forth herein.

 

1.4. Compensation. “Compensation” means (select one option):

 

	
  Option 1.

  	
  þ

  	
  Total taxable salary, bonuses and commissions paid to
  a Participant by the Employer (determined without regard to any amounts in
  the Participant’s Deferred Compensation Account).

  
	
   

  	
   

  	
   

  
	
  Option 2.

  	
  o

  	
  Total taxable salary and commissions of the
  Participant paid or accrued by the Employer, but not including the value of
  any bonuses, stock options, stock appreciation rights (determined without
  regard to any amounts in the Participant’s Deferred Compensation Account).

  
	
   

  	
   

  	
   

  
	
  Option 3.

  	
  o

  	
  Other

  

 

1.5. Deferred Compensation Account. “Deferred
Compensation Account” means the book-keeping account maintained under the Plan
in the Participant’s name to reflect amounts deferred under the Plan pursuant
to Section 3 (as adjusted under Section 4) and (if elected by the
Company) any Employer Discretionary Contributions made on behalf of the
Participant (as adjusted under Section 4).

 

1.6. Deferral Election. “Deferral Election” means
a written notice filed by the Participant with the Employer specifying the
Compensation or bonus to be deferred by the Participant.

 

1.7. Distribution Date. “Distribution Date” means
the date a Participant terminates employment or association with the Employers
for whatever reason, unless such termination of employment is for Good Cause.

 

1.8. Early Retirement Date. “Early Retirement
Date” means (select one option):

 

	
   

  	
  o The date the
  Participant attains                     
  years of age.

  
	
   

  	
   

  
	
   

  	
  þ The date the Participant attains 55 years of age and has been
  employed by the Company or its Affiliates for at least 10 years.

  

 

1.9. Effective Date. “Effective Date” means
July 20, 2001.

 

C-2

 

1.10. Employee. “Employee” means an employee of
an Employer who meets the eligibility criteria set forth in Subsection 3.1 of
the Plan and who is a member of a select group of management or highly
compensated employees as defined under ERISA or the regulations thereunder.

 

1.11. Employer. “Employer” means, individually,
the Company and each Affiliate of the Company that adopts the Plan in
accordance with Subsection 7.1. The Company and any Affiliates that adopt the
Plan are sometimes collectively referred to herein as the “Employers.”

 

1.12. ERISA. “ERISA” means the Employee
Retirement Income Security Act of 1974, as amended from time to time. Any
reference to a section of ERISA includes any comparable section or sections of
any future legislation that amends, supplements or supersedes that section.

 

1.13. Excess Contributions. “Excess Contributions”
means contributions determined to be excess contributions or excess deferrals
(as such terms are defined in the regulations under Section 401(k) of the Code)
for the Plan Year under a plan maintained by an Employer that is qualified
under Sections 401(a) and 401(k) of the Code.

 

1.14. Independent Contractor. “Independent
Contractor” means an individual who is not a common-law employee of an Employer
but who receives payments from the Employer for services rendered.

 

1.15. Normal Retirement Date. “Normal Retirement
Date” means (select one option):

 

	
   

  	
  o The date the
  Participant attains                     
  years of age.

  
	
   

  	
   

  
	
   

  	
  þ The date the Participant attains 65 years of age and has been
  employed by the Company or its Affiliates for at least 10 years.

  

 

1.16. Participant. “Participant” means an
Employee or Independent Contractor who meets the eligibility criteria set forth
in Subsection 3.1 and who has made a Deferral Election in accordance with the
terms of the Plan.

 

1.17. Plan. “Plan” means the provisions of the
Plan, as set forth herein, including the variable provisions selected and
agreed to by the Company.

 

1.18. Plan Administrator. The “Plan Administrator”
means (select one option):

 

	
  o

  	
  The Company.

  
	
   

  	
   

  
	
  o

  	
  A committee of at least                     
  members appointed by the Company

  
	
   

  	
   

  
	
  þ

  	
  The C.F.O. (insert
  title) of the Company.

  
	
   

  	
   

  
	
  o

  	
  Other

  

 

1.19. Plan Year. “Plan Year” means the calendar
year. However, if the Effective Date of the Plan is other than January 1 of a
year, the initial Plan Year shall be a short Plan Year, beginning on the
Effective Date and ending on the following December 31.

 

1.20. Unforeseeable Financial Emergency. “Unforeseeable
Financial Emergency” means a severe financial hardship of the Participant
resulting from:

 

C-3

 

	
   

  	
  (a)

  	
  A sudden and unexpected illness or accident of the
  Participant or of a dependent of the Participant;

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  Loss of the Participant’s principal residence due to
  casualty; or

  
	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  Such other similar extraordinary and unforeseeable
  circumstances resulting from events beyond the control of the Participant.

  

 

Whether a Participant has an Unforeseeable Financial
Emergency shall be determined in the sole discretion of the Plan Administrator.

 

1.21. Valuation Date. “Valuation Date” means (select one option):

 

	
   

  	
  þ Any business day.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  o The last day of any
  calendar month.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  o The last day of any
  calendar quarter.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  o The last day of the
  Plan Year.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  o

  	
  Other

  	
   

  
					

 

1.22. Other Definitions. In addition to the terms
defined in this Section 1, other terms are defined when first used in
later Sections of this Plan.

 

SECTION 2

Purpose and Administration

 

2.1. Purpose. The Company has established the
Plan primarily for the purpose of providing deferred compensation to a select
group of management or highly compensated employees of the Employers. The Plan
is intended to be a top-hat plan described in Section 201(2) of ERISA. If
elected by the Company under Subsection 3.1 of the Plan, Independent
Contractors also may participate in the Plan. The Company intends that the Plan
(and each Trust under the Plan (as described in Subsection 6.1)) shall be
treated as unfunded for tax purposes and for purposes of Title I of ERISA. An
Employer’s obligations hereunder, if any, to a Participant (or to a Participant’s
beneficiary) shall be unsecured and shall be a mere promise by the Employer to
make payments hereunder in the future. A Participant (or the Participant’s
beneficiary) shall be treated as a general unsecured creditor of the Employer.

 

2.2. Administration. The Plan shall be
administered by the Plan Administrator. The Plan Administrator shall serve at
the pleasure of the Company’s Board of Directors and may be removed by such
Board, with or without cause. The Plan Administrator may resign upon prior
written notice to the Company’s Board of Directors.

 

The Plan Administrator shall have the powers, rights,
and duties set forth in the Plan and shall have the power, in the Plan
Administrator’s sole and absolute discretion, to determine all questions
arising under the Plan, including the determination of the rights of all
persons with respect to the Plan and to interpret the provisions of the Plan
and remedy any ambiguities, inconsistencies, or omissions Any decisions of the
Plan Administrator shall be final and binding on ail persons with respect to
the Plan and the benefits provided under’ the Plan. The Plan Administrator may
delegate the Plan Administrator’s authority under 

 

C-4

 

the Plan to one or more officers or directors of the
Company; provided, however, that (a) such delegation must be in writing,
and (b) the officers or directors of the Company to whom the Plan
Administrator is delegating authority must accept such delegation in writing.

 

If a Participant is serving as the Plan Administrator (either
individually or as a member of a committee), the Participant may not decide or
determine any matter or question concerning such Participant’s benefits under
the Plan that the Participant would not have the right to decide or determine
if the Participant were not serving as the Plan Administrator.

 

SECTION 3

Eligibility, Participation, Deferral Elections,

and Employer Contributions

 

3.1. Eligibility and Participation, Subject to
the conditions and limitations of the Plan, the following persons are eligible
to participate in the Plan (select and
complete option(s)):

 

	
  þ

  	
  All Employees with a rank of Manager (insert title) or above and with total
  earnings of at least $85,000 per Plan Year

  
	
   

  	
   

  
	
  o

  	
  The following Employees of the Employers:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  (Attach a separate sheet if necessary)

  
	
   

  	
   

  
	
  o

  	
  The following Independent Contractors:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  (Attach a separate sheet if necessary)

  

 

Any individuals specified above by an Employer may be
changed by action of the Employer An Employee or Independent Contractor shall
become a Participant in the Plan upon the execution and filing with the Plan
Administrator of a written election to defer a portion of the Employee’s or
Independent Contractor’s Compensation. A Participant shall remain a Participant
until the entire balance of the Participant’s Deferred Compensation Account has
been distributed.

 

3.2. Rules for Deferral Elections. Any person
identified in Subsection 3.1 may make a Deferral Election to defer receipt of
Compensation he or she otherwise would be entitled to receive for a Plan Year
in accordance with the rules set forth below:

 

	
   

  	
  (a)

  	
  All Deferral Elections must be made in writing on the
  form prescribed by the Plan Administrator and will be effective only when
  filed with the Plan Administrator no later than the date specified by the
  Plan Administrator. In no event may a Deferral Election be made later than
  the last day of the

  

 

C-5

 

	
   

  	
   

  	
  Plan Year preceding the Plan Year in which the amount
  being deferred would otherwise be made available to the Participant. However,
  in the case of a Participant’s initial year of employment or association with
  an Employer, the Participant may make a Deferral Election with respect to
  compensation for services to be performed subsequent to such Deferral
  Election, provided such election is made no later than 30 days after the
  date the Participant first becomes eligible for the Plan. Furthermore, in the
  case of a short initial Plan Year, each Participant may make a Deferral
  Election with respect to compensation for services to be performed subsequent
  to such Deferral Election, provided such election is made no later than
  30 days after the Effective Date.

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  With respect to Plan Years following the Participant’s
  initial Plan Year of participation in the Plan, failure to complete a
  subsequent Deferral Election shall constitute a waiver of the Participant’s
  right to elect a different amount of Compensation to be deferred for each
  such Plan Year and shall be considered an affirmation and ratification to
  continue the Participant’s existing Deferral Election. However, a Participant
  may, prior to the beginning of any Plan Year, elect to increase or decrease
  the amount of Compensation to be deferred for the next following Plan Year by
  filing another Deferral Election with the Plan Administrator in accordance
  with paragraph (a) above.

  
	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  A Deferral Election in effect for a Plan Year may not be
  modified during the Plan Year, except that a Participant may terminate the
  Participant’s Deferral Election during a Plan Year in the event of an
  Unforeseeable Financial Emergency.

  

 

3.3. Amounts Deferred. (select one option):

 

	
   

  	
  Option 1. þ Deferral of a Percentage of Compensation plus Bonus.

  
	
   

  	
   

  
	
   

  	
  Commencing on the Effective Date, a Participant may
  elect to defer (a) up to 100% of the Participant’s Compensation for a
  Plan Year and (b) up to 100% of the Participant’s bonus for a Plan Year.
  The amount of Compensation and bonus deferred by a Participant shall be
  credited to the Participant’s Deferred Compensation Account as of the
  Valuation Date coincident with or immediately following the date such
  Compensation and bonus would, but for the Participant’s Deferral Election, be
  payable to the Participant.

  
	
   

  	
   

  
	
   

  	
  Option 2. o Deferral of Bonus
  Only.

  
	
   

  	
   

  
	
   

  	
  Commencing on the Effective Date, a Participant may
  elect to defer up to % of any
  bonus awarded to the Participant during a Plan Year. The amount of bonus
  deferred by a Participant shall be credited to the Participant’s Deferred
  Compensation Account as of the Valuation Date coincident with or immediately
  following such the date such bonus would, but for the Participant’s Deferral
  Election, be payable to the Participant.

  
	
   

  	
   

  
	
   

  	
  Option 3. þ Deferral of Excess Contributions

  
	
   

  	
   

  
	
   

  	
  Commencing on the Effective Date, a Participant may
  elect to defer an amount equal to the Excess Contributions payable to the
  Participant during a Plan Year. Such amount shall be credited to the
  Participant’s Deferred Compensation Account as of the Valuation Date
  coincident with or immediately following the date such amount would, but for
  the Participant’s Deferral Election, be payable to the Participant.

  

 

3.4 Employer Discretionary Contributions. If
selected by the Company below, an Employer may, in its sole discretion, credit
to the Deferred Compensation Account of any Participant employed by that
Employer an amount determined by the Employer in its sole discretion (an “Employer
Discretionary

 

C-6

 

Contribution”) for a Plan Year. Any Employer
Discretionary Contribution for a Plan Year will be credited to a Participant’s
Deferred Compensation Account as of the Valuation Date specified by the
Employer.

(select one of the following options)

 

	
   

  	
  o No Employer Discretionary
  Contributions will be made under the Plan.

  
	
   

  	
   

  
	
   

  	
  þ Employer Discretionary Contributions may be made under the Plan for a
  Plan Year as determined by each Employer in its sole discretion.

  

 

SECTION 4

Deferred Compensation Accounts

 

4.1. Deferred Compensation Accounts. All amounts
deferred pursuant to one or more Deferral Elections under the Plan and any
Employer Discretionary Contributions shall be credited to a Participant’s
Deferred Compensation Account and shall be adjusted under Subsection 4.2

 

4.2. Deferral Account Adjustments and Investment
Options. As of each Valuation Date, the Plan Administrator shall adjust
amounts in a Participant’s Deferred Compensation Account to reflect earnings
(or losses) in the Investment Options (as defined in Subsection 4.4)
attributable to the Participant’s Deferred Compensation Account Earnings (or
losses) on amounts in a Participant’s Deferred Compensation Account shall
accrue commencing on the date the Deferred Compensation Account first has a
positive balance and shall continue to accrue until the entire balance in the
Participant’s Deferred Compensation Account has been distributed. Earnings (or
losses) shall be credited to a Participant’s Deferred Compensation Account
based on the realized rate of return (net of any expenses and taxes paid from
the Trust) on the Investment Options attributable to the Participant’s Deferred
Compensation Account.

 

4.3. Vesting. A Participant shall be fully vested
in the amounts in the Participant’s Deferred Compensation Account attributable
to the Participant’s Deferral Elections. If Employer Discretionary
Contributions are made under the Plan, a Participant shall be vested in the
amount in the Participant’s Deferred Compensation Account attributable to
Employer Discretionary Contributions in accordance with the following (select Options 1, 2, or 3 and, if desired, Option 4.
and/or Option 5):

 

Option 1. þ Five Year Vesting Schedule

 

Vesting for Participants will be determined by (select one):

 

	
   

  	
  þ Years of Service with the Employer.

  
	
   

  	
   

  
	
   

  	
  o Years of
  Participation in this Plan.

  

 

Nonforfeitable Percentage

 

	
  Less than 5 years

  	
   

  	
  0

  	
  %

  
	
  5 or more years

  	
   

  	
  100

  	
  %

  

 

Option 2 o Seven Year Graded Vesting
Schedule

 

Vesting for Participants will be determined by (select one):

 

	
   

  	
  o Years of Service
  with the Employer.

  
	
   

  	
   

  
	
   

  	
  o Years of
  Participation in this Plan.

  

 

Nonforfeitable Percentage

 

	
  Less than 3 years

  	
   

  	
  0

  	
  %

  
	
  3 years

  	
   

  	
  20

  	
  %

  
	
  4 years

  	
   

  	
  40

  	
  %

  
	
  5 years

  	
   

  	
  60

  	
  %

  
	
  6 years

  	
   

  	
  80

  	
  %

  
	
  7 years

  	
   

  	
  100

  	
  %

  

 

C-7

 

	
  Option 3.

  	
  o

  	
  Other vesting schedule as described below:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Option 4.

  	
  o

  	
  Notwithstanding the foregoing vesting schedule, the
  balance in a Participant’s Deferred Compensation Account attributable to
  Employer Discretionary Contributions will be forfeited if the Participant’s
  employment or association with the Employer is terminated for Good Cause.

  
	
   

  	
   

  	
   

  
	
  Option 5

  	
  o

  	
  Notwithstanding the foregoing vesting schedule, the
  entire balance in a Participant’s Deferred Compensation Account attributable
  to Employer Discretionary Contributions will be fully vested upon the
  Participant’s Early Retirement Date.

  

 

For the purpose of determining a Participant’s vested
benefit with respect to Employer Discretionary Contributions, a “Year of
Service” means each twelve-month period of employment or association with the
Company and the Affiliates, and a “Year of Participation” means each
twelve-month period of active participation in the Plan. Notwithstanding the
foregoing, a Participant shall be fully vested in the entire balance in the
Participant’s Deferred Compensation Account upon the Participant’s Normal
Retirement Date, death or becoming disabled (as provided in Subsection 5.2
below), provided the date on which the Participant dies or becomes disabled
occurs while the Participant is actively employed by or associated with the
Employers. The portion of a Participant’s Deferred Compensation Account in
which the Participant is not fully vested shall be forfeited to the Employer by
the Participant.

 

If elected by the Company under Option 4. above,
notwithstanding the vesting schedule selected in Option 1., 2., or 3. above,
the balance in a Participant’s Deferred Compensation Account attributable to
Employer Discretionary Contributions will be forfeited (and neither the Participant
nor the Participant’s beneficiaries will have any rights thereto) if the
Participant’s employment with the Employer is terminated for Good Cause. “Good
Cause” means the Participant’s gross negligence, fraud, dishonesty, or willful
violation of any law or significant policy of the Employer that is committed in
connection with the Participant’s employment by or association with the
Employer Whether a Participant has been terminated for Good Cause shall be
determined by the Plan Administrator

 

4.4 Investment Options. The Company shall, from
time to time and in its sole discretion, select one or more investment vehicles
(“Investment Options”) to be made available as the measuring standards for
crediting earnings or losses to each participant’s Deferred Compensation
Account A Participant may select from such Investment Options in a manner
established by the Company, the investment vehicle or vehicles to apply to his
or her accounts and may change such selections, all in accordance with such
rules as the Company may establish. Notwithstanding the foregoing, the
Committee may change the method for crediting earnings or losses to each
participant’s accounts as described above by written notice to each Participant
(including former Participants who then have a Deferred Compensation Account
which would

 

C-8

 

be affected by such change), which notice shall specify
the new method for crediting earnings or losses to be used under this section,
the effective date of such change and the Deferred Compensation Accounts to
which such new method shall apply.

 

SECTION 5

Payment of Benefits

 

5.1. Time and Method of Payment. Payment of the
vested portion of a Participant’s Deferred Compensation Account shall be made
as soon as practicable following the Valuation Date coincident with or next
following the Participant’s Distribution Date; provided, however, that if the
Company has elected a daily Valuation Date, such payment will be made as soon
as practicable following the last business day of the month in which the
Participant’s Distribution Date occurs. Payment of the vested portion of a
Participant’s Deferred Compensation Account shall be made as follows (select one option):

 

	
  Option 1.

  	
  o

  	
  A single, lump sum payment.

  
	
   

  	
   

  	
   

  
	
  Option 2.

  	
  o

  	
  Substantially equal monthly installment payments for       
  months.

  
	
   

  	
   

  	
   

  
	
  Option 3.

  	
  þ

  	
  Substantially equal monthly installment payments for
  60 months with a one-time option to receive a lump sum payment. The Participant
  may elect to receive a single, lump sum payment in lieu of installment
  payments. Such election must be made by filing a written election with the
  Plan Administrator at least 30 days prior to the time installment
  payments would otherwise begin, and such election is subject to approval by
  the Employer of the Participant.

  

 

5.2 Payment Upon Disability. In the event a
Participant becomes disabled (as defined below) while the Participant is
employed by or associated with an Employer, payment of the Participant’s
Deferred Compensation Account shall be made (or shall commence) as soon as
practicable after the Valuation Date coincident with or next following the date
on which the Plan Administrator determines that the Participant is disabled.
For purposes of this Subsection 5.2, a Participant shall be considered disabled
if the Participant is unable to engage in any substantially gainful activity by
reason of any medically determined physical or mental impairment that can be
expected to result in death or that has lasted or can be expected to last for a
continuous period of not less than twelve months. Whether a Participant is
disabled for purposes of the Plan shall be determined by the Plan
Administrator, and in making such determination, the Plan Administrator may
rely on the opinion of a physician (or physicians) selected by the Plan
Administrator for such purpose.

 

5.3. Payment Upon Death of a Participant. A
Participant’s Deferred Compensation Account shall be paid to the Participant’s
beneficiary (designated in accordance with Subsection 5.4) in a single lump sum
as soon as practicable following the Valuation Date coincident with or next
following the Participant’s death.

 

5.4. Beneficiary. If a Participant is married on
the date of the Participant’s death, the Participant’s beneficiary shall be the
Participant’s spouse, unless the Participant names a beneficiary or
beneficiaries (other than the Participant’s spouse) to receive the balance of
the Participant’s Deferred Compensation Account in the event of the Participant’s
death prior to the payment of the Participant’s entire Deferred Compensation
Account. To be effective, any beneficiary designation must be filed in writing
with the Plan Administrator in accordance with rules and procedures adopted by
the Plan Administrator for that purpose. A Participant may revoke an existing
beneficiary designation by filing another written beneficiary designation with
the Plan Administrator. The latest beneficiary designation received by the

 

C-9

 

Plan Administrator shall be controlling. If no
beneficiary is named by a Participant, or if the Participant survives all of
the Participant’s named beneficiaries and does not designate another
beneficiary, the Participant’s Deferred Compensation Account shall be paid in
the following order of precedence:

 

	
   

  	
  (a)

  	
  The Participant’s spouse;

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  The Participant’s children (including adopted
  children) per stripes; or

  
	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  The Participant’s estate.

  

 

5.5. Unforeseeable Financial Emergency. If the
Plan Administrator determines that a Participant has incurred an Unforeseeable
Financial Emergency, the Participant may receive in cash the portion of the
balance of the Participant’s Deferred Compensation Account needed to satisfy
the Unforeseeable Financial Emergency, but only if the Unforeseeable Financial
Emergency may not be relieved (a) through reimbursement or compensation by
insurance or otherwise or (b) by liquidation of the Participant’s assets
to the extent the liquidation of such assets would not itself cause severe
financial hardship. A payment on account of an Unforeseeable Financial
Emergency shall not be in excess of the amount needed to relieve such
Unforeseeable Financial Emergency and shall be made as soon as practicable
following the date on which the Plan Administrator approves such payment.

 

5.6. Withholding of Taxes. In connection with the
Plan, the Employers shall withhold any applicable Federal, state or local
income tax and any employment taxes, including Social Security taxes, at such
time and in such amounts as is necessary to comply with applicable laws and
regulations.

 

SECTION 6

Miscellaneous

 

6.1. Funding. Each Employer under the Plan shall
establish and maintain one or more trusts (individually, a “Trust”) to hold
assets to be used for payment of benefits under the Plan. The assets of the
Trust with respect to benefits payable to the Participants employed by or
associated with an Employer shall remain the assets of such Employer subject to
the claims of its general creditors. Any payments by a Trust of benefits
provided to a Participant under the Plan shall be considered payment by the
applicable Employer and shall discharge such Employer from any further
liability under the Plan for such payments.

 

6.2. Rights. Establishment of the Plan shall not
be construed to give any Employee or Independent Contractor the right to be
retained by the Employers or to any benefits not specifically provided by the
Plan.

 

6.3. Interests Not Transferable. Except as to
withholding of any tax under the laws of the United States or any state or
locality and the provisions of Subsection 5.4, no benefit payable at any time
under the Plan shall be subject in any manner to anticipation, alienation,
sale, transfer, assignment, pledge, or any other encumbrance of any kind or to
any attachment, garnishment, or other legal process of any kind. Any attempt by
a person (including a Participant or a Participant’s beneficiary) to
anticipate, alienate, sell, transfer, assign, pledge, or otherwise encumber any
benefits under the Plan, whether currently or thereafter payable, shall be
void. If any person shall attempt to, or shall alienate, sell, transfer,
assign, pledge or otherwise encumber such person’s benefits under the Plan, or
if by any reason of such person’s bankruptcy or other event happening at any
time, such benefits would devolve upon any other person or would not be enjoyed
by the person entitled thereto under the Plan, then the Plan Administrator, in
the Plan Administrator’s sole discretion, may terminate the interest in any
such benefits of the person otherwise entitled thereto under the Plan and may
hold or apply such benefits in such manner as the Plan Administrator may deem
proper.

 

C-10

 

6.4. Forfeitures and Unclaimed Amounts. Unclaimed
amounts shall consist of the amounts in the Deferred Compensation Account of a
Participant that cannot be distributed because of the Plan Administrator’s
inability, after a reasonable search, to locate a Participant or the
Participant’s beneficiary, as applicable, within a period of two years after
the Distribution Date upon which the payment of benefits became due. Unclaimed
amounts shall be forfeited at the end of such two-year period. These
forfeitures will reduce the obligations of the Employers, if any, under the
Plan. After an unclaimed amount has been forfeited, the Participant or
beneficiary, as applicable, shall have no further right to amounts in the
Participant’s Deferred Compensation Account.

 

6.5. Controlling Law. The law of the state New
Hampshire shall be controlling in all matters relating to the Plan to the
extent not preempted by Federal law.

 

6.6. Number. Words in the plural shall include
the singular, and the singular shall include the plural.

 

6.7. Action by the Employers. Except as otherwise
specifically provided herein, any action required of or permitted to be taken
by an Employer under the Plan shall be by resolution of its Board of Directors
or by resolution of a duly authorized committee of its Board of Directors or by
action of a person or persons authorized by resolution of such Board of
Directors or such committee.

 

6.8. Offset for Obligations to Employer. If, at
such time as a Participant or a Participant’s beneficiary becomes entitled to
benefit payments hereunder, the Participant has any debt, obligation or other
liability representing an amount owing to an Employer or an Affiliate of the
Employer, and if such debt, obligation, or other liability is due and owing at
the time benefit payments are payable hereunder, the Employer may offset the
amount owing it or an Affiliate against the amount of benefits otherwise
distributable hereunder.

 

6.9. No Fiduciary Relationship. Nothing contained
in this Plan, and no action taken pursuant to its provisions by either the
Employers or the Participants shall create, or be construed to create a
fiduciary relationship between the Employer and the Participant, a designated
beneficiary, other beneficiaries of the Participant, or any other person.

 

6.10. Claims Procedures. Any person (hereinafter
referred to as a “Claimant”) who believes that he or she is being denied a
benefit to which he or she may be entitled under the Plan may file a written
request for such benefit with the Plan Administrator. Such written request must
set forth the Claimant’s claim and must be addressed to the Plan Administrator,
at the Company’s principal place of business. Upon receipt of a claim, the Plan
Administrator shall advise the Claimant that a reply will be forthcoming within
ninety days and shall deliver a reply within ninety days. The Plan
Administrator may, however, extend the reply period for an additional ninety
days for reasonable cause. If the claim is denied in whole or in part, the Plan
Administrator shall issue a written determination, using language calculated to
be understood by the Claimant, setting forth:

 

	
   

  	
  (a)

  	
  The specific reason or reasons for such denial;

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  The specific reference to pertinent provisions of the
  Plan upon which such denial is based;

  
	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  A description of any additional material or
  information necessary for the Claimant to perfect the Claimant’s claim and an
  explanation why such material or such information is necessary; and

  
	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  Appropriate information as to the steps to be taken if
  the Claimant wishes to submit the claim for review, and the time limits for
  requesting such a review.

  

 

C-11

 

Within sixty days after’ the receipt by the Claimant of
the written determination described above, the Claimant may request in writing,
that the Plan Administrator review the Plan Administrator’s determination. The
request must be addressed to the Plan Administrator, at the Company’s principal
place of business. The Claimant or the Claimant’s duly authorized
representative may, but need not, review the pertinent documents and submit
issues and comments in writing for consideration by the Plan Administrator. If
the Claimant does not request a review of the Plan Administrator’s determination
within such sixty day-period, the Claimant shall be barred and estopped from
challenging the Plan Administrator’s determination. “Within sixty days after
the Plan Administrator’s receipt of a request for review, the Plan
Administrator will review the determination. After considering all materials
presented by the Claimant, the Plan Administrator will render a written
determination, written in a manner calculated to be understood by the Claimant
setting forth the specific reasons for the decision and containing specific
references to the pertinent provisions of the Plan on which the decision is
based. If special circumstances require that the sixty day time period be
extended, the Plan Administrator will so notify the Claimant and will render
the decision as soon as practicable, but no later than one hundred twenty days
after receipt of the request for review.

 

6.11. Notice. Any notice required or permitted to
be given under the provisions of the Plan shall be in writing, and shall be
signed by the party giving or making the same. If such notice, consent or
demand is mailed to a party hereto, it shall be sent by United States certified
mail, postage prepaid, addressed to such party’s last known address as shown on
the records of the Employers. Notices to the Plan Administrator should be sent
in care of the Company at the Company’s principal place of business. The date
of such mailing shall be deemed the date of notice. Either party may change the
address to which notice is to be sent by giving notice of the change of address
in the manner set forth above.

 

SECTION 7

Employer Participation

 

7.1. Adoption of Plan. Any Affiliate of the
Company may, with the approval of the Company, adopt the Plan by filing with
the Company a resolution of its Board of Directors to that effect.

 

7.2. Withdrawal from the Plan by Employer. Any
Employer shall have the right, at any time, upon the approval of, and under
such conditions as may be provided by the Plan Administrator, to withdraw from
the Plan by delivering to the Plan Administrator written notice of its election
so to withdraw. Upon receipt of such notice by the Plan Administrator, the
portion of the Deferred Compensation Account of Participants and beneficiaries
attributable to amounts deferred while the Participants were employed by or
associated with such withdrawing Employer shall be distributed from the Trust
at the direction of the Plan Administrator in cash at such time or times as the
Plan Administrator in the Plan Administrator’s sole discretion, may deem to be
in the best interest of such Participants and their beneficiaries. To the
extent the amounts held in the Trust for the benefit of such Participants and
beneficiaries are not sufficient to satisfy the Employer’s obligation to such
Participants and their beneficiaries accrued on account of their employment
with the Employer, the remaining amount necessary to satisfy such obligation
shall be an obligation of the Employer, and the other Employers shall have no
further obligation to such Participants and beneficiaries with respect to such
amounts.

 

SECTION 8

Amendment and Termination

 

The Company intends the Plan to be permanent, but
reserves the right at any time to modify, amend or terminate the Plan; provided
however, that except as provided below, any amendment or termination of the
Plan shall not reduce or eliminate any balance in a Participant’s Deferred
Compensation Account

 

C-12

 

accrued through the date of such amendment or
termination. Upon termination of the Plan, the Company may provide that
notwithstanding the Participant’s Distribution Date, all Deferred Compensation
Account balances will be distributed on a date selected by the Company.

 

SECTION 9

Change of Control

 

9.1. Overriding Provisions Applicable During a
Restricted Period. The following provisions of this Section 9 will
become effective on a Restricted Date as the result of a Change of Control and
will remain in effect during the Restricted Period beginning on that date until
the following related Unrestricted Date, and during the Restricted Period, will
supersede any other provisions of the Plan to the extent necessary to eliminate
any inconsistencies between the provisions of this Section 9 and any other
provisions of the Plan, including any supplements thereto.

 

9.2. Suspension of Part or All of the Overriding
Provisions. If a majority of the members of the Entire Board are Continuing
Directors (provided such majority is equal to the same number as constituted a
majority of the Entire Board immediately prior to the Change of Control), by
the affirmative vote of a majority of the Entire Board and a majority of those
members of the Entire Board who are Continuing Directors, all or a designated
portion or portions of the following provisions of this Section 9 may be
declared not applicable as to the specified transaction or event. No portion of
the provisions of this Section 9 will apply to any transaction or event to
the extent such portion is inconsistent with the requirements of applicable
law.

 

9.3. Definitions. For purposes of this
Section 9, the definitions set forth in Paragraphs (a) through
(k) below will apply. Definitions set forth elsewhere in the Plan also
will apply to the provisions set forth in this Section 9, except that
where a definition set forth elsewhere in the Plan and a definition set forth
in this Subsection conflict, the definition set forth in this Subsection will
govern.

 

	
   

  	
  (a)

  	
  “Acquiring Person” will mean any Person, who or which,
  together with all Affiliates and Associates of such Person, is the Beneficial
  Owner of shares of common stock of the Company constituting more than
  20 percent of the common stock then outstanding.

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  “Affiliate” and “Associate” will have the meaning
  ascribed to such terms in Rule 12b-2 of the General Rules and
  Regulations under the Securities Exchange Act of 1934 (the “Act”).

  
	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  “Beneficial Owner” will have the meaning ascribed to
  such term in Rule 13d-3 of the Act.

  
	
   

  	
   

  	
   

  
	
   

  	
  (d)

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

  
	
   

  	
   

  	
   

  
	
   

  	
  (e)

  	
  A “Change of Control” will be deemed to occur
  (i) upon any Person becoming an Acquiring Person if the Board of
  Directors has not recommended that stockholders of the Company tender or
  otherwise sell their common stock to such Acquiring Person; (ii) upon
  the approval by the stockholders of the Company of a reorganization, merger
  or consolidation, in each case, with respect to which persons who were
  stockholders of the Company immediately prior to such reorganization, merger
  or consolidation, do not, immediately thereafter, own more than
  50 percent of the combined voting power entitled to vote generally in
  the election of directors of the reorganized, consolidated or merged
  Company’s then outstanding securities; or (iii) upon a liquidation or dissolution
  of the Company or the sale of all or substantially all of the Company’s
  assets.

  
	
   

  	
   

  	
   

  
	
   

  	
  (f)

  	
  “Continuing Director” will mean:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (i)

  	
  any member of the Board of Directors immediately prior
  to a Change of Control, or

  

 

C-13

 

	
   

  	
   

  	
  (ii)

  	
  any successor of a Continuing Director who is
  recommended or elected to succeed such Continuing Director by a majority of
  the Continuing Directors then in office and is neither an Acquiring Person,
  an Affiliate of an Acquiring Person, nor a representative or nominee of an
  Acquiring Person or of any such Affiliate while such person is a member of
  the Board of Directors.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Notwithstanding the foregoing, a successor will not be
  deemed to be a Continuing Director unless, immediately prior to his or her
  appointment or election, a majority of the members of the Entire Board were
  Continuing Directors (and unless such majority is equal to the same number as
  constituted a majority of the Entire Board immediately prior to the Change of
  Control).

  
	
   

  	
   

  
	
   

  	
  (g)

  	
  “Person” will mean any individual, firm, corporation
  or other entity, and will include any “group” as that term is used in
  Rule 13d-5(b) of the Act.

  
	
   

  	
   

  	
   

  
	
   

  	
  (h)

  	
  “Restricted Date” will mean the date on which a Change
  of Control occurs.

  
	
   

  	
   

  	
   

  
	
   

  	
  (i)

  	
  “Restricted Period” will mean the period beginning on
  a Restricted Date and ending on the fifth anniversary of such Restricted
  Date.

  
	
   

  	
   

  	
   

  
	
   

  	
  (j)

  	
  “Unrestricted Date” will mean the last day of a
  Restricted Period.

  
	
   

  	
   

  	
   

  
	
   

  	
  (k)

  	
  “Entire Board” will mean the total number of members
  of the Board of Directors that there would be if there were no vacancies on
  such Board.

  

 

9.4. Benefits Vested on Restricted Date.
Effective on a Restricted Date, the balances in the Deferred Compensation
Accounts (including any contributions and investment earnings after that date)
of each Participant who is a Participant in the Plan on that date will become
fully vested and nonforfeitable.

 

9.5. Prohibition Against Amendment. During the
Restricted Period, the provisions of this Section 9 may not be amended or
deleted and may not be superseded by any other provision of the Plan (including
the provisions of any exhibit or supplement thereto).

 

IN WITNESS WHEREOF, the Company has caused this Plan to
be executed by its duly authorized officers on this 23 day of July, 2001.

 

 

	
   

  	
  Viewpoint International, Inc.

  	
   

  
	
   

  	
  (Name of Company)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  
	
  ATTEST:

  	
   

  	
   

  
	
  Its:

  	
   

  	
   

  
				

 

C-14

 

AMENDMENT
TO THE

VIEWPOINT INTERNATIONAL, INC.

NONQUALIFIED DEFERRED COMPENSATION PLAN

 

THIS AMENDMENT to the Viewpoint International, Inc.
Nonqualified Deferred Compensation Plan is adopted by Viewpoint International, Inc.
(the “Company”), effective as of the date set forth herein.

 

W I T N E S S E T H:

 

WHEREAS, the
Company maintains the Viewpoint International, Inc. Nonqualified Deferred
Compensation Plan (the “Plan”), and such Plan is currently in effect; and

 

WHEREAS, the
Company wishes to amend the Plan as permitted by Section 8 of the Plan.

 

NOW, THEREFORE, the Company hereby amends the Plan as follows:

 

1.               Appendix A shall be added to the Plan in the form attached hereto.

 

2.               This amendment shall be effective immediately upon execution.

 

IN WITNESS WHEREOF, the undersigned has adopted this
Amendment effective as of the dates indicated above.

 

	
   

  	
   

  	
   

  	
  VIEWPOINT INTERNATIONAL, INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  By

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title

  	
   

  

 

C-15

 

X.15.a.1.1

 

APPENDIX A

SPECIAL RULES APPLICABLE TO 2003
SPECIAL CLOSING BONUSES

 

A1. Exclusion of Certain Bonuses. Notwithstanding
any other provision of the plan to the contrary, Compensation as defined in
Section 1.4 of the Plan shall not include any bonus (a “Closing Bonus”)
payable to a Participant contingent on the consummation of the sale of the
Company pursuant to that certain Stock Purchase Agreement dated as of
April 26, 2003 by and among the Oxford Industries, Inc., the Company,
and the stockholders of the Company (the “sale”) and so no deferral will be
effective with respect to any such bonus except as otherwise expressly provided
in this Appendix A.

 

A2. Special Deferral Election. Participants who
are notified that they may become entitled to receive a Closing Bonus equal to
or exceeding $250,000 (an “Eligible Bonus”) may make a special Deferral
Election (a “Special Election”) with respect to any such Eligible Bonus in
accordance with the rules set forth below:

 

	
   

  	
  (a)

  	
  The Special Election must be made in writing on the
  form prescribed by the Plan Administrator for the purpose of such Special
  Election and must be delivered to the Plan Administrator prior to the
  consummation of the Sale.

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  The Special Election is subject to the consummation of
  the Sale and the payment of an Eligible Bonus.

  
	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  The Special Election shall not be valid if the actual
  Closing Bonus paid to the participant is than $250,000.

  
	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  The Special Election is applicable solely to an
  Eligible Bonus and does not revoke or modify any Deferral Election otherwise
  in effect under the Plan with respect to a participant’s Compensation
  (including any other bonuses).

  
	
   

  	
   

  	
   

  
	
   

  	
  (e)

  	
  The Special Election is irrevocable.

  

 

A3. Special Deferral Amount. A Participant may
elect to defer all or any portion (in a whole percentage or dollar amount ) of
an Eligible Bonus. The amount deferred by a Participant shall be credited to
the Participant’s Deferred Compensation Account at the same time and shall be
adjusted under Section 4.2 in the same manner as any other bonus under the
Plan but shall be accounted for separately from all other amounts credited to
such Participant’s Account.

 

A4. Vesting in Special Deferral Amount. A
Participant shall be fully vested in the Participant’s Deferred Compensation
Account attributable to the Participant’s Special Election Pursuant to this
Appendix A.

 

A5. Time and Method of Payment. Payment of a
Participant’s Deferred Compensation Account attributable to the Participant’s
Special Election shall be made in accordance with one of the following options
elected by the Participant on the special election form provided to the
Participant pursuant to Section A2 above:

 

	
   

  	
  (a)

  	
  A single lump sum payment made no sooner than
  January 1, 2005 and no later than May 3l, 2007.

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  Substantially equal annual installment payments
  commencing on any date elected by the Participant and ceasing no later than
  May 31, 2007.

  

 

C-16

 

Such election is irrevocable and may not be modified at
any time for any reason.

 

A6. Other Plan Provisions Apply. The provisions
of this Appendix A shall supercede all inconsistent provisions of the
Plan, provided that all other provisions of the Plan shall apply with respect
to a Participant and the Deferred Compensation Account attributable to the
Participant’s Special Election made in accordance with this Appendix A to
the extent not inconsistent with the provisions of this Appendix A as
determined by the Plan Administrator in its sole and absolute discretion.

 

C-17

 

AMENDMENT
TO THE

VIEWPOINT INTERNATIONAL, INC.

NONQUALIFIED DEFERRED COMPENSATION PLAN

 

Pursuant to § 8 of the Viewpoint International, Inc.
Executive Deferred Compensation plan (the “PLAN”), Viewpoint International, Inc.
(the “Company”) hereby amends the Plan as follows:

 

1.

 

Effective as of January 1, 2005, Section 1.18
of the Plan shall be amended to read as follows:

 

“The Plan Administrator means a committee of at least
three (3) persons appointed by the Company.”

 

2.

 

Effective as of January 1, 2005, Section 3.1 of
the Plan shall be amended to read as follows:

 

“3.1 Eligibility and Participation. Subject to
the conditions and limitations of the Plan, the following persons are eligible
to participate in the Plan: Any Employee who is Employed by the Employer and
who is determined by the Employer, in its sole discretion, to be both
(i) a member of a select group of management or highly compensated
employees and (ii) eligible to participate in the Plan. Any individuals
specified by the Employer may be changed by action of the Employer. An Employee
shall become a Participant in the Plan upon the execution and filing with the
plan Administrator of a written election to defer a portion of the Employee’s
Compensation. A participant shall remain a Participant until the entire balance
of the Participant’s Deferred Compensation Account has been distributed.”

 

3.

 

Except as specifically set forth herein, the terms of
the plan shall remain in full force and effect.

 

IN WITNESS WHEREOF, the Company has caused this
Amendment to be executed on the date set forth below.

 

	
   

  	
  VIEWPOINT INTERNATIONAL, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
  Date:

  	
   

  

 

C-18

 

EXHIBIT D

 

TOMMY BAHAMA PLAN

 

SPECIAL RULES APPLICABLE TO 2005
COMPENSATION

 

Notwithstanding any other provision of the Tommy Bahama
Plan to the contrary, the provisions of this Exhibit D shall supersede all
inconsistent provisions of the Tommy Bahama Plan with respect to amounts
deferred in taxable years beginning after December 31, 2004 and before January 1,
2006 (and earnings on such amounts) and earnings in 2005 on deferrals made in
taxable years before January 1, 2005. 
All other provisions of the Tommy Bahama Plan shall apply with respect
to such deferrals to the extent not inconsistent with the provisions of this Exhibit D
or Section 409A of the Code, as determined by the Committee in its sole
and absolute discretion.  This Exhibit D
is intended to (a) satisfy the requirements of Section 409A(a)(2), (3) and
(4) of the Code for deferrals made after December 31, 2004 and before
January 1, 2006 and (b) not constitute a material modification of the
Tommy Bahama Plan with respect to amounts deferred before January 1, 2005.

 

1.                                       Account(s).  A separate bookkeeping account
shall be established to account for deferrals made in taxable years beginning
after December 31, 2004 and before January 1, 2006 (and any earnings
on such deferrals) and earnings in 2005 on deferrals made in taxable years
before January 1, 2005.  The portion
of any Deferred Compensation Account that was not fully vested on December 31,
2004 shall be treated as a deferral made in taxable years beginning after December 31,
2004.

 

2.                                       Deferral
Elections.  In no event may a Deferral Election be made
later than the last day of the Plan Year preceding the Plan Year in which the
amount being deferred is earned by the Participant, except that a Deferral
Election with respect to Excess Contributions payable to the Participant in
2005 may be made on or before December 31, 2004 in accordance with Q&A
21 of IRS Notice 2005-1.

 

3.                                       Time
and Method of Payment.  In order for a termination of employment or
association with the employers to qualify as a Distribution Event, the
termination of employment or association must qualify as a “separation from
service” within the meaning of Section 409A of the Code and the
regulations thereunder.  Section 5.1
of the Tommy Bahama Plan is amended to provide that distributions shall be made
in a single, lump sum payment and will commence in the first calendar month
that is 6 months from the Participant’s Distribution Date.

 

4.                                       Disability
or Death.  If distribution is made as a result of the
Participant’s disability or death under Sections 5.2 or 5.3 of the Tommy Bahama
Plan, distribution will commence in the first month of the calendar quarter
immediately following the quarter in which his or her disability or death
occurred.  A Participant shall be
considered disabled if the Participant is unable to engage in any substantially
gainful activity by reason of any medically determined physical or mental
impairment that can be expected to result in death or that can be expected to
last from a continuous period of not less than twelve months.

 

5.                                       Unforeseeable
Financial Emergency.  The provisions of Sections 1.20, 3.2(c) and
5.5 of the Tommy Bahama Plan shall not apply, and Section 7.2(d) of
the Plan shall apply as if incorporated in the Tommy Bahama Plan.

 

D-1

 

6.                                       Delay
of Payments Under Certain Circumstances.  Section 7.2(e) of the Plan shall
apply as if incorporated in the Tommy Bahama Plan.

 

7.                                       Amendment
and Termination.  The provisions of Section 8 of the Tommy
Bahama Plan shall not apply, and Section 10.12 of the Plan shall apply as
if incorporated in the Tommy Bahama Plan.

 

D-2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00182-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00182-of-00352.parquet"}]]