Document:

Ex-4.2 Shareholders Agreement

 

EXHIBIT 4.2

SHAREHOLDERS’ AGREEMENT

     This Shareholders’ Agreement (this “Agreement”) is entered into and shall be effective as of
September, 2004 among Envision Worldwide Holdings Limited, a British Virgin Islands international
business company (the “Company”), and certain shareholders of the Company from time to time made a
party hereto (each such Person being referred to herein as a “Shareholder” and all such Persons
being referred to collectively herein as the “Shareholders”).

RECITALS

     Each person signing this Agreement is desirous of becoming a shareholder of the Company by
purchasing securities of the Company or exercising options to purchase securities of the Company,
and the Company is desirous in connection therewith and as a condition precedent thereto to confirm
certain understandings with such persons relating to the securities being acquired by such person.

TERMS OF AGREEMENT

     NOW, THEREFORE, in consideration of the mutual covenants contained in this Agreement, and for
other good and valuable consideration, the receipt and sufficiency of which arc hereby
acknowledged, the parties hereby agree as follows:

ARTICLE I

GENERAL PROVISIONS

     1.1 Application. Each Shareholder expressly agrees that the terms and conditions of
this Agreement shall apply to: (a) all shares of common stock, par value $1.00 per share of the
Company (the “Common Stock”), and all other securities of the Company which he now owns or has
voting control over, including, without limitation, the shares of Common Stock acquired by such
Shareholder upon the exercise of options granted pursuant to the Envision Worldwide Holdings
Limited 2004 Key Executive Stock Option Plan (the “Plan”); (b) any shares of Common Stock and other
securities of the Company which he hereafter acquires or obtains voting control over by any means,
including without limitation, upon the exercise of options granted pursuant to the Plan, or by
agreement, purchase, assignment or operation of law, or as a result of any stock dividend, stock
split, reorganization, reclassification or other similar transaction (whether voluntary or
involuntary); and (c) any shares of capital stock and other securities of any successor in interest
of the Company which he hereafter acquires or obtains voting control over, including, without
limitation, by means of a sale, merger, consolidation or other similar transaction, or by purchase,
assignment or operation of law (collectively, the “Shares”).

     1.2 Additional Shareholders. Except as expressly set forth herein or agreed to by the
Company, any Person acquiring Shares shall, as a precondition of acquiring such Shares, promptly
thereafter become a party to this Agreement by signing and delivering to the Company a written
agreement to that effect; and the certificates evidencing the Shares acquired by any such Person
shall bear the legend set forth in Section 1.4 of this Agreement, and be subject to, and have the
benefit of, the terms and provisions of this Agreement.

 

 

     1.3 No Partnership Relationship. Notwithstanding any provision of this Agreement,
subject to applicable law, the parties understand and agree that the management and operation of
the Company in accordance with the terms of this Agreement shall not create or imply a general
partnership, fiduciary or similar relationship between or among the Shareholders and any other
shareholders of the Company and shall not make any Shareholder the agent or partner of any other
shareholder of the Company for any purpose.

     1.4 Legend. All Shares shall be certificated. All certificates representing Shares
shall on the face thereof bear the following legend:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), AND MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE
ISSUER THAT SUCH REGISTRATION IS NOT REQUIRED.

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL
RESTRICTIONS ON TRANSFER, REPURCHASE OPTIONS AND OTHER TERMS AND CONDITIONS SET
FORTH IN THAT CERTAIN SHAREHOLDERS’ AGREEMENT AMONG THE ISSUER AND CERTAIN OF ITS
SHAREHOLDERS, COPIES OF WHICH ARE ON FILE AT AND MAY BE OBTAINED FROM THE PRINCIPAL
OFFICE OF THE ISSUER. SUCH TRANSFER RESTRICTIONS AND OTHER TERMS AND CONDITIONS ARE
BINDING ON TRANSFEREES OF THESE SECURITIES.”

     1.5 Definitions. For purposes of this Agreement, (i) any decision, determination,
election or other action of the Company shall be deemed to require a majority vote of the Board of
Directors of the Company (the “Board”) unless otherwise specifically delegated by the Board; and
(ii) the following terms shall have the following meanings:

     “Drag-Along Sale” means the Sale of the Company approved by the Board.

     “Independent Third Party” means any Person who, immediately prior to a contemplated
transaction, does not own a majority of the Company’s capita] stock on a fully-diluted basis (a
“Majority Owner”), who is not controlling, controlled by or wider common control with any such
Majority Owner and who is not the spouse or descendent (by birth or adoption) of any such Majority
Owner or a trust for the benefit of such Majority Owner and/or such other Persons, a company (which
shall include corporations and limited liability companies) owned solely by such Majority Owner
and/or such other Persons or a partnership whose partners include only such Majority Owner and/or
such other Persons.

     “Initial Public Offering” means the first offer and sale of the Company’s capital
stock in an offering registered under the Securities Act of 1933, as amended (the “Securities
Act”), for the account of the Company.

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     “Person” means an individual, partnership, corporation, business trust, joint stock
corporation, estate, trust, unincorporated association, joint venture, governmental authority or
other entity of whatever nature.

     “Sale of the Company” means a sale of the Company to an Independent Third Party or
group of Independent Third Parties pursuant to which such Party or Parties acquire initially or
through a series of related transactions consummated within a twelve (12) month period (i) capital
stock of the Company possessing the voting power under normal circumstances to elect a majority of
the Board (whether by merger, consolidation or sale or transfer of the capital stock of the
Company) or (ii) all or substantially all of the Company’s assets determined on a consolidated
basis.

     Additional Defined Terms. With respect to a Shareholder, the terms “Cause,” “without
Cause,” and “Good Reason,” as used in this Agreement shall have the defined meanings set forth in
that certain Employment Agreement between AAI.FosterGrant, Inc., a Rhode Island corporation and
indirect majority-owned subsidiary of the Company (“FosterGrant”), and such Shareholder (or the
original Shareholder who directly or indirectly transferred such Shares to such Shareholder) as set
forth on Exhibit A hereto, as may be amended from time to time by the parties in accordance
with the terms therein or any subsequent employment agreement entered into by the parties in lieu
thereof. If such Shareholder is not listed on Exhibit A (and did not receive such Shares
directly or indirectly from a Shareholder listed on Exhibit A), then the terms “Cause,”
“without Cause,” and “Good Reason,” shall have the meaning given in the then-current written
employment agreement between such Shareholder (or the original Shareholder who directly or
indirectly transferred Shares to such Shareholder) and the Company, or one of its affiliates, as
applicable.

ARTICLE II

RESTRICTIONS ON TRANSFER OF SHARES

     2.1 Prohibition on Non-Complying Transfers. No Shareholder shall sell, assign,
transfer, exchange, gift, pledge, hypothecate, create a security interest in or lien on or
otherwise alienate, dispose of or encumber any Shares or any right or interest therein (each, a
“Transfer”) for value or otherwise, whether voluntarily or involuntarily, except in accordance with
the terms of this Article II or of Articles III or IV hereof, Any such purported Transfer in
violation of any provision of this Agreement shall be of no force or effect, and the Company shall
not be required to recognize such purported Transfer for any purpose, including without limitation,
for purposes of dividend and voting rights.

     2.2 Transfer of Shares Pursuant to a Bona Fide Offer.

          (a) Right of First Refusal of the Company and the 25% Owners. If any Shareholder
desires to Transfer any Shares to a Person pursuant to a bona fide offer (other than pursuant to a
Permitted Transfer (as defined below) or a Drag-Along Sale), such Shareholder (the “Selling
Shareholder”) shall give written notice (“Selling Shareholder’s Notice”) to the Company and each
Shareholder of the Company owning at least twenty-five percent (25%) of the Company’s capital stock
as recorded in the Company’s stock register on a fully-diluted basis (a “25% Owner” (whose names
and addresses the Company shall promptly supply to

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Shareholder upon request) setting forth (i) the number of Shares that the Selling Shareholder
proposes to sell; (ii) the name and address of the proposed transferee; (iii) the proposed purchase
price, terns of payment and other material terms and conditions of such proposed Transfer, and (iv)
an estimate, in the Selling Shareholder’s reasonable judgment, of the fair market value of any
non-cash consideration offered by the proposed transferee; and attaching a copy of the binding
written offer or agreement of the proposed transferee to purchase such Shares from the Selling
Shareholder. Upon receipt of the Selling Shareholder’s Notice, the Company shall have the option
(but not the obligation), exercisable by delivery of written notice (the “Company’s Notice”) to the
Selling Shareholder within thirty (30) days of receipt of the Selling Shareholder’s Notice (the
“Company’s Election Period”), to purchase or designate one or more Persons to purchase all or any
portion of the Shares proposed to be sold (the “Offered Shares”) at a price (the “Purchase Price”)
equal to the price set forth in the Selling Shareholder’s Notice, payable as provided in Section
2.2(b) hereof. If the Company does not elect to purchase or designate one or more Persons to
purchase all of the Offered Shares, then the 25% Owners shall have the option (but not the
obligation), exercisable by delivery of written notice (the “25% Owners’ Notice”) to the Selling
Shareholder within thirty (30) days of receipt of the Selling Shareholder’s Notice (the “25%
Owners’ Election Period”) to purchase all remaining Offered Shares (the “Remaining Shares”) not so
elected to be purchased by the Company on the same terms and conditions as specified in the Selling
Shareholder’s Notice. Unless otherwise agreed between or among the 25% Owners, each of the 25%
Owners may purchase his pro rata portion of the Remaining Shares, which shall be calculated by
multiplying the number of Remaining Shares by a fraction, the numerator of which is the number of
Shares held by such 25% Owner and the denominator of which is the number of Shares held by all 25%
Owners. If one or more of the 25% Owners elects not to purchase his pro rata portion of the
Remaining Shares, then the remaining 25% Owners may purchase their pro rata portion of the
remaining shares of the Remaining Shares in successive rounds until all such Shares have been
purchased.

          (b) Transfers to the Company and/or the 25% Owners. Notwithstanding anything else to
the contrary set forth herein, the Company (or its designees) and/or the 25% Owners must together
purchase either all or none of the Offered Shares from the Selling Shareholder. If the Company
(and its designees) and/or the 25% Owners have not elected to purchase all of the Offered Shares
from the Selling Shareholder, the Selling Shareholder may sell the Offered Shares to the proposed
transferee in accordance with Section 2.2(c) below. If the Company has elected to purchase or
designate one or more Persons to purchase all or any portion of the Offered Shares from the Selling
Shareholder, the Transfer of such Shares shall be consummated as soon as practicable after delivery
of the Company’s Notice, but in any event within thirty (30) days after the expiration of the
Company’s Election Period. If the 25% Owners have elected to purchase all or any portion of the
Offered Shares from the Selling Shareholder, the Transfer of such Shares shall be consummated as
soon as practicable after delivery of the 25% Owners’ Notice, but in any event within thirty (30)
days after the expiration of the 25% Owners’ Election Period. The Company and/or each of the 25%
Owners to the extent that each elects to purchase any of the Offered Shares, shall be referred to
as the “Purchasing Entity.” At the closing of the purchase of the Offered Shares, (I) the
Purchasing Entity shall pay to the Selling Shareholder the Purchase Price, and (2) the Selling
Shareholder shall provide representations and warranties to the Purchasing Entity and/or its
designees as to his title to such securities and confirming that there are no liens or encumbrances
on such securities (other than pursuant to this Agreement) and shall indemnify and hold the
Purchasing Entity (and/or its

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designees, in the case of the Company) harmless against any breach thereof, and sign such
stock powers and other documents as may be reasonably requested by the Purchasing Entity (and/or
its designees, in the case of the Company).

          (c) Transfers to Third Parties. If the Company and/or the 25% Owners shall not have
elected to purchase (or, in the case of the Company, designate one or more Persons to purchase) all
of the Offered Shares proposed to be sold in the Selling Shareholder’s Notice, then the Selling
Shareholder shall be free to sell all, but not less than all, the Offered Shares to the proposed
transferee designated in the Selling Shareholder’s Notice at a price and on terms no less favorable
to the Selling Shareholder than those described in the Selling Shareholder’s Notice; provided,
however, that such sale is consummated within ninety (90) days after the giving of the Selling
Shareholder’s Notice to the Company and the 25% Owners pursuant to Section 2.2(a). As a condition
precedent to the effectiveness of a Transfer pursuant to this Section 2.2(c), the proposed
transferee shall agree in writing prior to such Transfer to become a party to and abide by the
terms and conditions of this Agreement and to hold the Shares so transferred subject to the terms
and conditions of this Agreement (and any amendments hereto).

     2.3 Permitted Transfers. Notwithstanding anything to the contrary set forth in this
Agreement, the restrictions set forth in this Article II shall not apply to any Transfer of Shares
by a Shareholder pursuant to Articles III or IV hereof or (a) to any other Shareholder; (b) to his
spouse or children, or to a trust established solely for the benefit of his spouse, children or
himself or herself, or to any of the foregoing pursuant to his or her will; (c) to a company (which
may be a corporation or a limited liability company) whose shareholders or members consist solely
of such Shareholder; (d) to a partnership whose partners consist solely of such Shareholder or (e)
to any other Person approved by the Board of Directors of the Company in its sole and absolute
discretion (each of the foregoing being referred to herein as a “Permitted Transfer”); provided,
however, that, any transferee first agrees in writing prior to such Transfer to become a party to
and abide by the terms and conditions of this Agreement and to hold the Shares so transferred
subject to the terms and conditions of this Agreement (and any amendments hereto).

ARTICLE III

REDEMPTION OF SHARES

     3.1 Right of the Company to Redeem Shares. The Company shall have the option (but not
the obligation), exercisable by it at any time following the termination of a Shareholder’s
employment with the Company, or its affiliates, as applicable, for any reason, within 90 days
following the later of (i) such termination or (ii) with respect to any particular Share, the date
such Share was acquired by a Shareholder whether through the exercise of an option or otherwise, by
delivery of written notice (the “Redemption Notice”) to the Shareholder (the “Redemption
Shareholder”), to purchase or designate one or more Persons to purchase (a “Redemption”) all or any
portion of the Shares held by such Shareholder (the “Redemption Shares”) at a price (the
“Redemption Price”) determined as follows: (a) if the Shareholder’s employment is terminated for
“Cause”, or by the Shareholder for any reason other than “Good Reason”, then the Redemption Price
shall be $92,000 per Share (subject to adjustment in the event of changes in the capitalization of
the Company in the same way the exercise price of options ranted under the Plan would be adjusted
in such event pursuant to Section 19 of the Plan), and (b) if the Shareholder’s employment is
terminated “without Cause,” or by the

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Shareholder for Good Reason, then the Redemption Price shall be equal to the fair market value
of the Shares as determined in good faith by the Board of Directors of the Company as of the date
the Redemption Notice is delivered by the Company. Any determination by the Board of Directors of
the Company of the price at which the Company or its designee may purchase Shares shall be final,
conclusive and binding on the parties. The Redemption Price shall be payable as provided in Section
3.2 hereof. The Board shall determine in its sole and absolute discretion whether Cause exists
under the applicable Employment Agreement and such determination shall be final, conclusive and
binding on the Shareholder.

     3.2 Redemption Procedures. If the Company has elected to purchase or designate one or
more Persons to purchase any Shares under Section 3.1 above, the Transfer of such Shares shall be
consummated as soon as practicable (but not more than thirty (30) days) following the delivery of
the Redemption Notice. At the close of the purchase of the Redemption Shares, the Redemption
Shareholder shall provide representations and warranties to the Company and/or its designees as to
his title to such securities and confirming that there are no liens or encumbrances on such
securities (other than pursuant to this Agreement or pursuant to the actions of the Company) and
shall indemnify and hold the Company and/or its designees harmless against any breach thereof, and
sign such stock powers and other documents as may be reasonably requested by the Company and/or its
designees. At the close of the purchase of the Redemption Shares, the Company shall pay to the
Redemption Shareholder the Redemption Price by delivery of cash or, at the election of the Company,
a promissory note (i) bearing interest at five percent (5%) per annum, (ii) payable in equal
monthly installments over a period designated by the Company of up to two (2) years; and (iii)
providing the Company with right of offset on account of the Shareholder’s breach of any provision
of any employment or other agreement entered into by the Shareholder with the Company, or its
affiliates, as applicable.

     3.3 Right of Redemption Following Permitted Transfer. In the event a Shareholder (a
“Transferring Shareholder”) has made a Permitted Transfer of shares pursuant to Section 2.3, then
such Shares shall remain subject to this Article III and upon the Transferring Shareholder ceasing
his employment with the Company, or its affiliates, as applicable, for any reason, then such Shares
shall still be subject to redemption pursuant to this Article Ill notwithstanding their transfer to
a Permitted Transferee (or subsequent Permitted Transferee) in accordance with Section 2.3.

ARTICLE IV

SALE OF THE COMPANY

     In the event of a Drag-Along Sale, upon the written request of the selling shareholder
initiating the sale as in the case of a sale of equity securities or of the Company as in the case
of a sale of all or substantially all assets, the Company shall deliver written notice to each
Shareholder at least twenty (20) days prior to the consummation of such transaction, setting forth
the material terms thereof. Each Shareholder shall (i) vote for, consent to and raise no objection
to such Drag-Along Sale, (ii) if the Drag-Along Sale is structured as a merger or consolidation,
waive any dissenters, appraisal or similar rights in connection with such merger or consolidation,
(iii) if the Drag-Along Sale is structured as a sale of stock, agree to sell and sell all of his
Shares and rights to acquire Shares (or, in the event that the proposed transaction shall result in
the sale of less than one hundred (100%) percent of the Company’s capital stock, that number of
Shares

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that is equal to the product obtained by multiplying (a) the aggregate number of shares of
equity securities of the Company to be transferred in the proposed transaction by (b) such
Shareholder’s ownership percentage of the outstanding shares of equity securities of the Company
immediately before the proposed transaction) on the same terns and conditions as all other holders
of the same class of securities, and (iv) take such actions and execute such documents as shall be
deemed necessary or desirable by the Board in connection with the consummation of the Drag-Along
Sale and the Transfer of his Shares.

ARTICLE V

CO-SALE RIGHT

     No 25% Owner shall transfer any shares of capital stock of the Company constituting at least
fifty-one percent (51%) of the aggregate issued and outstanding capital stock of the Company on a
fully diluted basis (assuming exercise, exchange or conversion of all options, warrants and other
securities which may be converted into or exchanged or exercised for shares of capital stock of the
Company) (“Capital Stock”), in any one or more transactions, until such 25% Owner notifies each
Shareholder of the proposed transaction and gives each Shareholder the opportunity to include such
Shareholder’s Shares in the sale to the proposed transferee, upon the same terns and conditions
offered to the 25% Owner by such transferee. The number of shares of Capital Stock that the 25%
Owner and each Shareholder shall be entitled to have included in such sale will be a number
determined by multiplying the number of shares of Capital Stock initially proposed to be sold by
the 25% Owner by a fraction, the numerator of which is the total number of shares of Capital Stock
owned by such 25% Owner or Shareholder, as the case may be, and the denominator of which is the
total number of shares of Capital Stock then owned by all Shareholders and the 25% Owner. Each
Shareholder shall have a period of 5 days (the “Co-Sale Offer Period”) from the date on which
notice of such opportunity is received to give the 25% Owner written notice of its desire to
participate in such sale, stating in such notice the number of Shares desired to be sold; and if no
such notice is given within the Co-Sale Offer Period, such Shareholder shall be deemed to have
chosen not to participate. If during the Co-Sale Offer Period, any Shareholders choose not to
participate in such a sale, in whole or in part, the 25% Owner shall promptly notify all other
participating Shareholders and such other Shareholders shall have the right, for a 5-day period
beginning on the first day after the expiration of the Co-Sale Offer Period, to increase the number
of Shares they may sell pursuant to this Article V, so that each Shareholder and the 25% Owner get
to sell additional shares in such transaction in the same proportion as the Shares they are
permitted to sell in such transaction pursuant to the second sentence of this section.

ARTICLE VI

CORPORATE GOVERNANCE

     In the event that the Shareholder shall at any time hold Shares that are entitled to vote on
any matter submitted to the shareholders of the Company, each such Shareholder shall, in connection
with any matter that may be submitted to the Shareholders from time to time (including, without
limitation, the election of directors), vote all of his Shares and any other voting securities of
the Company over which such Shareholder has voting control in favor of any action proposed by the
Board of Directors of the Company and against any action opposed by the Board of Directors of the
Company. In order to secure each Shareholder’s obligation to vote his

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Shares and other voting securities of the Company in accordance with the provisions of this
Agreement, each Shareholder hereby appoints a representative designated by the majority shareholder
of the Company (or if there shall be no such majority shareholder, a representative designated by
the Board of Directors of the Company) or his designee as his true and lawful proxy and
attorney-in-fact, with full power of substitution, to vote all of his Shares and other voting
securities of the Company for all matters that may be submitted to the shareholders of the Company
from time to time whether in person or by proxy at a meeting of shareholders or by execution of a
written consent of shareholders. The proxies and powers granted by each Shareholder pursuant to
this Article VI are coupled with an interest and are given as a condition to the issuance by the
Company of Shares to the Shareholders. Such proxies and powers shall be irrevocable for the term
of this Agreement and shall survive the death, incompetency, disability or bankruptcy of such
Shareholder and the subsequent holders of his Shares.

ARTICLE VII

REPRESENTATIONS AND WARRANTIES

     Each Shareholder represents and warrants to the Company and the other Shareholders as follows,
which representations and warranties shall survive the execution and delivery of this Agreement:

     (a) if the Shareholder is a business association, then such Shareholder is duly organized,
validly existing and in good standing under the laws of the jurisdiction in which it is
incorporated and has the corporate power and authority to enter into this Agreement and to
consummate the transaction contemplated hereby;

     (b) if the Shareholder is a natural person, then such Shareholder has the competence, power
and authority to enter into this Agreement and to consummate the transactions contemplated hereby;

     (c) this Agreement constitutes the legally valid and binding obligation of such Shareholder,
enforceable against him in accordance with its terms, except as such enforceability may be limited
by bankruptcy, insolvency, reorganization, moratorium, or other similar laws relating to creditors’
rights generally and by general principles of equity;

     (d) the execution and delivery of this Agreement does not violate, conflict with, breach or
cause a default under any agreement to which such Shareholder is a party or by which his properties
or assets are bound, or violate any judgment, rule, law or regulation applicable to him; and

     (e) such Shareholder has not engaged any broker, finder or investment banker, which engagement
would require the payment of fees by other parties hereto.

ARTICLE VIII

TERMINATION

     Except as otherwise provided herein, this Agreement shall terminate upon the first to occur of
the following events: (a) upon the consummation by the Company of an Initial Public Offering; or
(b) upon the mutual agreement of all parties.

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ARTICLE IX

MISCELLANEOUS

     9.1 Binding Effect. This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective heirs, successors and permitted assigns. Except as
expressly set forth herein, no party hereto may assign any of his rights or delegate any of his
duties hereunder except in connection with a transfer of Shares permitted under the terms of this
Agreement.

     9.2 Entire Agreement. This Agreement and any stock option agreements and any
employment, consulting and similar agreements entered into between the Company and any Shareholder
constitute the entire understanding of the parties and supersede all prior agreements,
understandings, arrangements, promises and commitments, whether written or oral, express or
implied, relating to the subject matter hereof, and all such prior agreements, understandings,
arrangements, promises and commitments are hereby canceled and terminated.

     9.3 Amendment. Except as otherwise provided herein, any modification, amendment or
waiver of any provision of this Agreement shall be effective against the Company and all
Shareholders when such modification, amendment, or waiver is approved in writing by (a) the Company
and (b) the holders of at least fifty-one (51%) percent of the shares of the Common Stock held by
all Persons party to this Agreement other than the Company; provided, however, that if such
amendment or modification would affect one or a group of Shareholders adversely but not affect all
such Shareholders adversely, then the consent of at least fifty-one percent (51%) of the Shares
held by the Shareholders adversely affected by such amendment or modification must first be
obtained by the Company; provided further, however, that the Company may from time to time add
additional shareholders of the Company to this Agreement without the consent or additional
signatures of the parties hereto (and/or amend and/or restate this Agreement to reflect such
additions) and, upon the Company’s receipt of such additional shareholders’ signature pages, such
additional shareholders shall be deemed to be a party hereto and such additional signature pages
shall be a part of this Agreement.

     9.4 Notices. Any notice, request or other document required or permitted to be given
under this Agreement shall be in writing and shall be deemed given to a party (a) upon delivery if
delivered by hand, (b) three days after the date of deposit in the mail, postage prepaid, if mailed
by U.S. certified or registered mail, or (c) on the next business day, if sent by prepaid overnight
courier service, in each case, addressed in the case of Shareholders to the address indicated in
the Shareholder’s then current personnel records if such Shareholder is an employee or to such
address as the Shareholder by notice to the Company may have designated from time to time, and in
the case of the Company to the principal executive office maintained by the Company from time to
time (to the attention of the Company’s President) or at such other address as the Company by
notice to the Shareholders may have designated from time to time.

     9.5 Waivers. The failure or delay of any party to enforce any provision of this
Agreement shall in no way affect the right of such party to enforce the same or any other provision
of this Agreement. The waiver by any party of any breach of any provision of this Agreement shall
not be construed as a waiver by such party of any succeeding breach of such provision or a waiver
by such party of a breach of any other provision. The granting of any
consent or approval by any party in any one instance shall not be construed to waive or limit
the need for such consent or approval in any other or subsequent instance.

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     9.6 Governing Law. This Agreement shall be construed in accordance with and governed
by the laws of the State of Rhode Island applicable to contracts executed and to be wholly
performed within such State (without regard to the choice of law provisions thereof). Each party
hereby irrevocably and unconditionally consents and submits to the exclusive jurisdiction of the
courts of the State of Rhode Island sitting in Providence County, Rhode Island and of the United
States District Court for the District of Rhode Island for any actions, suits or proceedings
arising out of or relating to this Agreement and the transactions contemplated hereby and each
party agrees not to commence any action, suit or proceeding relating thereto except in such courts.
Each party further agrees that any service of process, summons, notice or document sent by U.S.
registered mail to its address set forth herein shall be effective service of process for any
action, suit or proceeding brought against it in any such court. Each party irrevocably and
unconditionally waives any objection to the laying of venue of any action, suit or proceeding
arising out of this Agreement or the transactions contemplated hereby in such courts, and
irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any
action, suit or proceeding brought in any such court has been brought in an inconvenient forum.

     9.7 Severability. If any term or provision of this Agreement shall be determined by a
court of competent jurisdiction to be illegal, invalid or unenforceable for any reason, the
remaining provisions of this Agreement shall remain enforceable and the invalid, illegal or
unenforceable provisions shall be modified to the minimum extent possible so as to be enforceable
and shall be enforced.

     9.8 Section Headings. Section headings are included in this Agreement for convenience
of reference only, and shall in no way affect the meaning or interpretation of this Agreement.

     9.9 Number of Days. In computing the number of days for purposes of this Agreement,
all days shall be counted, including Saturdays, Sundays and holidays, provided, however, if the
final day of any time period falls on a Saturday, Sunday or holiday on which national banks in the
United States are or may elect to be closed, then the final day shall be deemed to be the next day
which is not a Saturday, Sunday or such holiday.

     9.10 Counterparts. This Agreement may be executed in any number of counterparts, each
of which shall be an original but all of which together shall constitute one and the same
instrument.

     9.11 Independent Causes; Attorneys’ Fees. The existence of any cause of action in
favor of any Shareholder against the Company, any affiliate or any other Shareholder shall not
constitute a defense to enforcement of such Shareholder’s covenants and agreements contained in
this Agreement by the Company and the other Shareholders. Each party hereto, in the event that any
other party hereto fails to observe or perform any of his warranties or covenants herein contained,
shall have all remedies available to him in law or equity, including, without limitation, the
equitable remedies of specific performance and injunctive relief, and shall be fully

10

 

indemnified by the party which fails to observe or perform any of his warranties or covenants
for (and held harmless against) any and all costs, expenses, damages and liabilities (including
without limitation reasonable attorneys’ fees and expenses) caused by or resulting from any such
failure.

     9.12 Further Assurances. Each party hereto agrees to act in good faith with respect
to achieving the objectives of this Agreement, and towards that end agrees to perform any further
acts and to execute and deliver any further documents which may be reasonably necessary to carry
out the purpose and intent of this Agreement.

     9.13 Number; Gender. Whenever used herein, the singular number shall include the
plural and the plural number shall include the singular; and the male gender shall include the
female gender and the neuter, and vice versa.

     9.14 Term. Except as otherwise provided in this Agreement, the term of this Agreement
shall be indefinite. Notwithstanding the disposition by a Shareholder of his Shares, this Agreement
shall nonetheless continue and remain in full force and effect in accordance with its terms and
conditions between and among the Company and the surviving or remaining Shareholders, and the
Shares owned by them shall remain subject to this Agreement.

[Signature Page Follows]

11

 

     IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by a duly authorized
officer and each Shareholder has executed this Agreement as of the day and year first written
above.

	 	 	 	 	 
	 	ENVISION WORLDWIDE HOLDINGS LIMITED

 	 
	 	By:  	/s/ John R. Ranelli
 	 
	 	 	John R. Ranelli, President and Chief 	 
	 	 	Executive Officer 	 
	 
	 	SHAREHOLDER:

 	 
	 	/s/ John R. Ranelli
 	 
	 	John R. Ranelli 	 
	 	Address: 	 
	 
	 	 	 
	 	                                              /s/ Brian J. Lagarto
 	 
	 	Brian J. Lagarto 	 
	 	Address: 	 
	 
	 	 	 
	 	                                              /s/ John R. Agre
 	 
	 	John R. Agre 	 
	 	Address: 	 
	 
	 	 	 
	 	                                              /s/ John H. Flynn, Jr.
 	 
	 	John H. Flynn, Jr. 	 
	 	Address: 	 

12

 

	 	 	 	 	 

	 	 	 	 	 
	 	25% OWNERS (only for purposes of Article V):

FG HOLDINGS LLC

 	 
	 	By:  	Medici I Investment Corp., Manager
 	 
	 	 	 	 
	 	 	 	 
	 
	 	 	 
	 	By:  	                                              /s/ Jared Bluestein
 	 
	 	 	Jared Bluestein, Director 	 
	 	 	 	 

13

 

	 	 	 	 	 

EXHIBIT A

EMPLOYMENT AGREEMENTS

Employment Agreement dated as of April 10, 2002 between AAi .FosterGrant, Inc. and John R. Ranelli,
as amended October 1, 2003 and September 30, 2004.

Employment Agreement dated as of April 10, 2002 between AAi .FosterGrant, Inc. and Brian J.
Lagarto, as amended October 1, 2003 and September 30, 2004.

Employment Agreement dated as of April 10, 2002 between AAi .FosterGrant, Inc. and John R. Agre, as
amended October 1, 2003 and September 30, 2004.

Employment Agreement dated as of April 10, 2002 between AAi. FosterGrant, Inc. and John H. Flynn,
Jr., as amended October 1, 2003 and September 30, 2004.

A-1Ex-10.1 First Lien Credit Agreement

 

EXHIBIT 10.1

 

$165,000,000

FIRST LIEN CREDIT AGREEMENT

among

FGX INTERNATIONAL INC.,

as US Borrower,

FGX INTERNATIONAL LIMITED,

as BVI Borrower,

The Several Lenders

from Time to Time Parties Hereto,

GENERAL ELECTRIC CAPITAL CORPORATION,

as Syndication Agent,

and

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

Dated as of December 9, 2005

 

J.P. MORGAN SECURITIES INC., as Co-Lead Arranger and Lead Bookrunner

and

GE CAPITAL MARKETS, INC., as Co-Lead Arranger

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Page
	Section
	 	 	1.	 	 	DEFINITIONS

	 	 	1	 
	 	 	 	1.1.	 	 	Defined Terms

	 	 	1	 
	 	 	 	1.2.	 	 	Other Definitional Provisions

	 	 	20	 
	 
	 	 	 	 	 	 
	 	 	 	 
	Section
	 	 	2.	 	 	AMOUNT AND TERMS OF TERM COMMITMENTS

	 	 	21	 
	 	 	 	2.1.	 	 	First Lien Term Commitments

	 	 	21	 
	 	 	 	2.2.	 	 	Procedure for First Lien Term Loan Borrowing

	 	 	21	 
	 	 	 	2.3.	 	 	Repayment of First Lien Term Loans

	 	 	21	 
	 
	 	 	 	 	 	 
	 	 	 	 
	Section
	 	 	3.	 	 	AMOUNT AND TERMS OF REVOLVING COMMITMENTS

	 	 	22	 
	 	 	 	3.1.	 	 	Revolving Commitments

	 	 	22	 
	 	 	 	3.2.	 	 	Procedure for Revolving Loan Borrowing

	 	 	22	 
	 	 	 	3.3.	 	 	Commitment Fees, etc.

	 	 	22	 
	 	 	 	3.4.	 	 	Termination or Reduction of Revolving Commitments

	 	 	23	 
	 	 	 	3.5.	 	 	L/C Commitment

	 	 	23	 
	 	 	 	3.6.	 	 	Procedure for Issuance of Letter of Credit

	 	 	23	 
	 	 	 	3.7.	 	 	Fees and Other Charges

	 	 	24	 
	 	 	 	3.8.	 	 	L/C Participations

	 	 	24	 
	 	 	 	3.9.	 	 	Reimbursement Obligation of the Borrower

	 	 	25	 
	 	 	 	3.10.	 	 	Obligations Absolute

	 	 	25	 
	 	 	 	3.11.	 	 	Letter of Credit Payments

	 	 	26	 
	 	 	 	3.12.	 	 	Applications

	 	 	26	 
	 
	 	 	 	 	 	 
	 	 	 	 
	Section
	 	 	4.	 	 	GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT

	 	 	26	 
	 	 	 	4.1.	 	 	Optional Prepayments

	 	 	26	 
	 	 	 	4.2.	 	 	Mandatory Prepayments and Commitment Reductions

	 	 	26	 
	 	 	 	4.3.	 	 	Conversion and Continuation Options

	 	 	27	 
	 	 	 	4.4.	 	 	Limitations on Eurodollar Tranches

	 	 	28	 
	 	 	 	4.5.	 	 	Interest Rates and Payment Dates

	 	 	28	 
	 	 	 	4.6.	 	 	Computation of Interest and Fees

	 	 	29	 
	 	 	 	4.7.	 	 	Inability to Determine Interest Rate

	 	 	29	 
	 	 	 	4.8.	 	 	Pro Rata Treatment and Payments

	 	 	29	 
	 	 	 	4.9.	 	 	Requirements of Law

	 	 	31	 
	 	 	 	4.10.	 	 	Taxes

	 	 	32	 
	 	 	 	4.11.	 	 	Indemnity

	 	 	33	 
	 	 	 	4.12.	 	 	Change of Lending Office

	 	 	33	 
	 	 	 	4.13.	 	 	Replacement of Lenders

	 	 	34	 
	 	 	 	4.14.	 	 	Evidence of Debt

	 	 	34	 
	 	 	 	4.15.	 	 	Illegality

	 	 	35	 
	 
	 	 	 	 	 	 
	 	 	 	 
	Section
	 	 	5.	 	 	REPRESENTATIONS AND WARRANTIES

	 	 	35	 
	 	 	 	5.1.	 	 	Financial Condition

	 	 	35	 
	 	 	 	5.2.	 	 	No Change

	 	 	36	 
	 	 	 	5.3.	 	 	Corporate Existence; Compliance with Law

	 	 	36	 
	 	 	 	5.4.	 	 	Power; Authorization; Enforceable Obligations

	 	 	36	 
	 	 	 	5.5.	 	 	No Legal Bar

	 	 	36	 

-i-

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Page
	 	 	 	5.6.	 	 	Litigation

	 	 	36	 
	 	 	 	5.7.	 	 	No Default

	 	 	37	 
	 	 	 	5.8.	 	 	Ownership of Property; Liens

	 	 	37	 
	 	 	 	5.9.	 	 	Intellectual Property

	 	 	37	 
	 	 	 	5.10.	 	 	Taxes

	 	 	37	 
	 	 	 	5.11.	 	 	Federal Regulations

	 	 	37	 
	 	 	 	5.12.	 	 	Labor Matters

	 	 	37	 
	 	 	 	5.13.	 	 	ERISA

	 	 	37	 
	 	 	 	5.14.	 	 	Investment Company Act; Other Regulations

	 	 	38	 
	 	 	 	5.15.	 	 	Subsidiaries

	 	 	38	 
	 	 	 	5.16.	 	 	Use of Proceeds

	 	 	38	 
	 	 	 	5.17.	 	 	Environmental Matters

	 	 	38	 
	 	 	 	5.18.	 	 	Accuracy of Information, etc.

	 	 	39	 
	 	 	 	5.19.	 	 	First Lien Security Documents

	 	 	39	 
	 	 	 	5.20.	 	 	Solvency

	 	 	40	 
	 	 	 	5.21.	 	 	Regulation H

	 	 	40	 
	 
	 	 	 	 	 	 
	 	 	 	 
	Section
	 	 	6.	 	 	CONDITIONS PRECEDENT

	 	 	40	 
	 	 	 	6.1.	 	 	Conditions to Initial Extension of Credit

	 	 	40	 
	 	 	 	6.2.	 	 	Conditions to Each Extension of Credit

	 	 	44	 
	 
	 	 	 	 	 	 
	 	 	 	 
	Section
	 	 	7.	 	 	AFFIRMATIVE COVENANTS

	 	 	45	 
	 	 	 	7.1.	 	 	Financial Statements

	 	 	45	 
	 	 	 	7.2.	 	 	Certificates; Other Information

	 	 	45	 
	 	 	 	7.3.	 	 	Payment of Obligations

	 	 	46	 
	 	 	 	7.4.	 	 	Maintenance of Existence; Compliance

	 	 	47	 
	 	 	 	7.5.	 	 	Maintenance of Property; Insurance

	 	 	47	 
	 	 	 	7.6.	 	 	Inspection of Property; Books and Records; Discussions

	 	 	47	 
	 	 	 	7.7.	 	 	Notices

	 	 	47	 
	 	 	 	7.8.	 	 	Environmental Laws

	 	 	48	 
	 	 	 	7.9.	 	 	Interest Rate Protection

	 	 	48	 
	 	 	 	7.10.	 	 	Additional Collateral, etc.

	 	 	48	 
	 	 	 	7.11.	 	 	Further Assurances

	 	 	49	 
	 	 	 	7.12.	 	 	Maintenance of Cash and Cash Equivalents in the United States

	 	 	50	 
	 	 	 	7.13.	 	 	Maintenance of Ratings

	 	 	50	 
	 
	 	 	 	 	 	 
	 	 	 	 
	Section
	 	 	8.	 	 	NEGATIVE COVENANTS

	 	 	50	 
	 	 	 	8.1.	 	 	Financial Condition Covenants

	 	 	50	 
	 	 	 	8.2.	 	 	Indebtedness

	 	 	52	 
	 	 	 	8.3.	 	 	Liens

	 	 	54	 
	 	 	 	8.4.	 	 	Fundamental Changes

	 	 	55	 
	 	 	 	8.5.	 	 	Disposition of Property

	 	 	56	 
	 	 	 	8.6.	 	 	Restricted Payments

	 	 	56	 
	 	 	 	8.7.	 	 	Capital Expenditures

	 	 	56	 
	 	 	 	8.8.	 	 	Investments

	 	 	57	 
	 	 	 	8.9.	 	 	Transactions with Affiliates

	 	 	58	 
	 	 	 	8.10.	 	 	Sales and Leasebacks

	 	 	58	 
	 	 	 	8.11.	 	 	Hedge Agreements

	 	 	58	 
	 	 	 	8.12.	 	 	Changes in Fiscal Periods

	 	 	58	 
	 	 	 	8.13.	 	 	Negative Pledge Clauses

	 	 	58	 
	 	 	 	8.14.	 	 	Clauses Restricting Subsidiary Distributions

	 	 	58	 

-ii-

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Page
	 	 	 	8.15.	 	 	Optional Payments and Modifications of Second Lien Debt

	 	 	59	 
	 	 	 	8.16.	 	 	Lines of Business

	 	 	59	 
	 	 	 	8.17.	 	 	Limitation on Activities of the BVI Borrower

	 	 	59	 
	 	 	 	8.18.	 	 	Factoring Agreements

	 	 	59	 
	 
	 	 	 	 	 	 
	 	 	 	 
	Section
	 	 	9.	 	 	EVENTS OF DEFAULT

	 	 	59	 
	 
	 	 	 	 	 	 
	 	 	 	 
	Section
	 	 	10.	 	 	THE AGENTS

	 	 	63	 
	 	 	 	10.1.	 	 	Appointment

	 	 	63	 
	 	 	 	10.2.	 	 	Delegation of Duties

	 	 	63	 
	 	 	 	10.3.	 	 	Exculpatory Provisions

	 	 	63	 
	 	 	 	10.4.	 	 	Reliance by Agents

	 	 	63	 
	 	 	 	10.5.	 	 	Notice of Default

	 	 	64	 
	 	 	 	10.6.	 	 	Non-Reliance on Agents and Other Lenders

	 	 	64	 
	 	 	 	10.7.	 	 	Indemnification

	 	 	64	 
	 	 	 	10.8.	 	 	Agent in Its Individual Capacity

	 	 	65	 
	 	 	 	10.9.	 	 	Successor Administrative Agent

	 	 	65	 
	 	 	 	10.10.	 	 	Agents Generally

	 	 	65	 
	 	 	 	10.11.	 	 	The Syndication Agent

	 	 	65	 
	 	 	 	10.12.	 	 	The L/C Lender

	 	 	66	 
	 	 	 	10.13.	 	 	First Lien Collateral Agent

	 	 	66	 
	 
	 	 	 	 	 	 
	 	 	 	 
	Section
	 	 	11.	 	 	MISCELLANEOUS

	 	 	66	 
	 	 	 	11.1.	 	 	Amendments and Waivers

	 	 	66	 
	 	 	 	11.2.	 	 	Notices

	 	 	67	 
	 	 	 	11.3.	 	 	No Waiver; Cumulative Remedies

	 	 	68	 
	 	 	 	11.4.	 	 	Survival of Representations and Warranties

	 	 	68	 
	 	 	 	11.5.	 	 	Payment of Expenses and Taxes

	 	 	69	 
	 	 	 	11.6.	 	 	Successors and Assigns; Participations and Assignments

	 	 	69	 
	 	 	 	11.7.	 	 	Adjustments; Set-off

	 	 	72	 
	 	 	 	11.8.	 	 	Counterparts

	 	 	73	 
	 	 	 	11.9.	 	 	Severability

	 	 	73	 
	 	 	 	11.10.	 	 	Integration

	 	 	73	 
	 	 	 	11.11.	 	 	GOVERNING LAW

	 	 	74	 
	 	 	 	11.12.	 	 	Submission To Jurisdiction; Waivers

	 	 	74	 
	 	 	 	11.13.	 	 	Acknowledgments

	 	 	75	 
	 	 	 	11.14.	 	 	Releases of Guarantees and Liens

	 	 	75	 
	 	 	 	11.15.	 	 	Confidentiality

	 	 	75	 
	 	 	 	11.16.	 	 	Joint and Several Liability

	 	 	76	 
	 	 	 	11.17.	 	 	Judgment Currency

	 	 	76	 
	 	 	 	11.18.	 	 	WAIVERS OF JURY TRIAL

	 	 	77	 
	 	 	 	11.19.	 	 	Delivery of Addenda

	 	 	77	 

-iii-

 

	 	 	 
	SCHEDULES:
	 	 
	 
	 	 
	1.1

	 	Mortgaged Property
	5.4

	 	Consents, Authorizations, Filings and Notices
	5.6

	 	Litigation
	5.15

	 	Subsidiaries
	5.19(a)

	 	UCC Filing Jurisdictions
	5.19(b)

	 	Mortgage Filing Jurisdictions
	8.2(d)

	 	Existing Indebtedness
	8.3(f)

	 	Existing Liens
	 
	 	 
	 
	 	 
	EXHIBITS:
	 	 
	 
	 	 
	A

	 	Form of First Lien Guarantee and Collateral Agreement
	B

	 	Form of Compliance Certificate
	C

	 	Form of Closing Certificate
	D

	 	Form of Mortgage
	E

	 	Form of Assignment and Assumption
	F-1

	 	Form of Legal Opinion of Greenberg Traurig LLP
	F-2

	 	Form of Legal Opinion of Morgan & Morgan
	F-3

	 	Form of Legal Opinion of Nixon Peabody LLP
	G

	 	Form of Exemption Certificate
	H

	 	Form of Addendum
	I

	 	Form of Intercreditor Agreement

-iv-

 

     FIRST LIEN CREDIT AGREEMENT, dated as of December 9, 2005, among FGX INTERNATIONAL INC., a
Delaware corporation (the “US Borrower”), FGX INTERNATIONAL LIMITED, a British Virgin
Islands international business company (the “BVI Borrower”, and together with the US
Borrower, the “Borrowers” and, individually, each a “Borrower”), the several banks
and other financial institutions or entities from time to time parties to this Agreement (the
“Lenders”), GENERAL ELECTRIC CAPITAL CORPORATION, as syndication agent (in such capacity,
the “Syndication Agent”), and JPMORGAN CHASE BANK, N.A., as administrative agent.

     The parties hereto hereby agree as follows:

SECTION 1. DEFINITIONS

     1.1. Defined Terms. As used in this Agreement, the terms listed in this Section 1.1
shall have the respective meanings set forth in this Section 1.1.

     “Addendum”: an instrument, substantially in the form of Exhibit H, by which a Lender
becomes a party to this Agreement as of the Closing Date.

     “Adjustment Date”: as defined in the Pricing Grid.

     “Administrative Agent”: JPMorgan Chase Bank, N.A., together with its affiliates, as
the arranger of the Commitments and as the administrative agent for the Lenders under this
Agreement and the other First Lien Loan Documents, together with any of its successors.

     “Affiliate”: as to any Person, any other Person that, directly or indirectly, is in
control of, is controlled by, or is under common control with, such Person. For purposes of this
definition, “control” of a Person means the power, directly or indirectly, either to (a) vote 10%
or more of the securities having ordinary voting power for the election of directors (or persons
performing similar functions) of such Person or (b) direct or cause the direction of the management
and policies of such Person, whether by contract or otherwise.

     “Agents”: the collective reference to the First Lien Collateral Agent, the
Syndication Agent and the Administrative Agent, which term shall include, for purposes of Section
10 and Section 11.5 only, the L/C Lender and the Issuing Bank.

     “Aggregate Exposure”: with respect to any Lender at any time, an amount equal to (a)
until the Closing Date, the aggregate amount of such Lender’s Commitments at such time and (b)
thereafter, the sum of (i) the aggregate then unpaid principal amount of such Lender’s First Lien
Term Loans and (ii) the amount of such Lender’s Revolving Commitment then in effect or, if the
Revolving Commitments have been terminated, the amount of such Lender’s Revolving Extensions of
Credit then outstanding.

     “Aggregate Exposure Percentage”: with respect to any Lender at any time, the ratio
(expressed as a percentage) of such Lender’s Aggregate Exposure at such time to the Aggregate
Exposure of all Lenders at such time.

     “Agreement”: this First Lien Credit Agreement.

     “Applicable Margin”: 3.00% per annum in the case of Base Rate Loans and 4.00% per
annum in the case of Eurodollar Loans; provided that, on and after the first Adjustment
Date occurring

 

 

after the completion of the fiscal quarter ended June 30, 2006, the Applicable Margin with
respect to the Loans will be determined pursuant to the Pricing Grid.

     “Application”: an application, in such form as the L/C Lender may specify from time
to time, requesting the L/C Lender to cause a Letter of Credit to be issued.

     “Asset Sale”: any Disposition of Property or series of related Dispositions of
Property (excluding any such Disposition permitted by clause (a), (b), (c), (d) or (f) of Section
8.5) that yields gross proceeds to any Group Member (valued at the initial principal amount thereof
in the case of non-cash proceeds consisting of notes or other debt securities and valued at fair
market value in the case of other non-cash proceeds) in excess of $100,000.

     “Assignee”: as defined in Section 11.6(b).

     “Assignment and Assumption”: an Assignment and Assumption, substantially in the form
of Exhibit E.

     “Available Revolving Commitment”: as to any Revolving Lender at any time, an amount
equal to the excess, if any, of (a) such Lender’s Revolving Commitment then in effect over
(b) such Lender’s Revolving Extensions of Credit then outstanding.

     “Base Rate”: for any day, a rate per annum (rounded upwards, if necessary, to the
next 1/16 of 1%) equal to the greater of (a) the Prime Rate in effect on such day and (b) the
Federal Funds Effective Rate in effect on such day plus 0.50%. For purposes hereof: “Prime
Rate” shall mean the rate of interest per annum publicly announced from time to time by the
Reference Lender as its prime rate in effect at its principal office in New York City (the Prime
Rate not being intended to be the lowest rate of interest charged by the Reference Lender in
connection with extensions of credit to debtors). Any change in the Base Rate due to a change in
the Prime Rate or the Federal Funds Effective Rate shall be effective as of the opening of business
on the effective day of such change in the Prime Rate or the Federal Funds Effective Rate,
respectively.

     “Base Rate Loans”: Loans the rate of interest applicable to which is based upon the
Base Rate.

     “Benefitted Lender”: as defined in Section 11.7(a).

     “Board”: the Board of Governors of the Federal Reserve System of the United States
(or any successor).

     “Borrowers”: as defined in the preamble to this Agreement.

     “Borrowing Date”: any Business Day specified by a Borrower as a date on which such
Borrower requests the relevant Lenders to make Loans hereunder.

     “Business”: as defined in Section 5.17(b).

     “Business Day”: a day other than a Saturday, Sunday or other day on which commercial
banks in New York City are authorized or required by law to close, provided, that with
respect to notices and determinations in connection with, and payments of principal and interest
on, Eurodollar Loans, such day is also a day for trading by and between banks in Dollar deposits in
the interbank eurodollar market.

2

 

     “BVI Borrower”: as defined in the preamble to this Agreement.

     “BVI Borrower Business”: the purchase and/or sale of products, and of other ancillary
or related items, whether as principal or agent, as part of the purchase or distribution of such
products by Domestic Subsidiaries or, in the case of products distributed outside the United
States, by any Subsidiaries, and the performance of other ancillary services on behalf of such
Domestic Subsidiaries or Subsidiaries, as the case may be, related to the business conducted by
such Subsidiaries, whether such performance is conducted by the BVI Borrower, or by Subsidiaries of
the BVI Borrower, and the operation and maintenance of one or more offices and of such staff, and
the conduct of such business necessary, incidental or ancillary for or to the conduct of any of the
foregoing.

     “Capital Expenditures”: for any period, with respect to any Person, the aggregate of
all expenditures by such Person and its Subsidiaries for the acquisition or leasing (pursuant to a
capital lease) of fixed or capital assets or additions to equipment (including replacements,
capitalized repairs and improvements during such period) or with respect to competitive payments to
customers, in each case, that should be capitalized under GAAP on a consolidated balance sheet of
such Person and its Subsidiaries.

     “Capital Lease Obligations”: as to any Person, the obligations of such Person to pay
rent or other amounts under any lease of (or other arrangement conveying the right to use) real or
personal property, or a combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP and, for the purposes
of this Agreement, the amount of such obligations at any time shall be the capitalized amount
thereof at such time determined in accordance with GAAP.

     “Capital Stock”: any and all shares, interests, participations or other equivalents
(however designated) of capital stock of a company or corporation, any and all equivalent ownership
interests in a Person (other than a corporation) and any and all warrants, rights or options to
purchase any of the foregoing.

     “Cash Equivalents”: (a) marketable direct obligations issued by, or unconditionally
guaranteed by, the United States Government or issued by any agency thereof and backed by the full
faith and credit of the United States, in each case maturing within one year from the date of
acquisition; (b) certificates of deposit, time deposits, eurodollar time deposits or overnight bank
deposits having maturities of six months or less from the date of acquisition issued by any Lender
or by any commercial bank organized under the laws of the United States or any state thereof having
combined capital and surplus of not less than $500,000,000; (c) commercial paper of an issuer rated
at least A-1 by S&P or B-1 by Moody’s, or carrying an equivalent rating by a nationally recognized
rating agency, if both of the two named rating agencies cease publishing ratings of commercial
paper issuers generally, and maturing within six months from the date of acquisition; (d)
repurchase obligations of any Lender or of any commercial bank satisfying the requirements of
clause (b) of this definition, having a term of not more than 30 days, with respect to securities
issued or fully guaranteed or insured by the United States government; (e) securities with
maturities of one year or less from the date of acquisition issued or fully guaranteed by any
state, commonwealth or territory of the United States, by any political subdivision or taxing
authority of any such state, commonwealth or territory or by any foreign government, the securities
of which state, commonwealth, territory, political subdivision, taxing authority or foreign
government (as the case may be) are rated at least A by S&P or A by Moody’s; (f) securities with
maturities of six months or less from the date of acquisition backed by standby letters of credit
issued by any Lender or any commercial bank satisfying the requirements of clause (b) of this
definition; or (g) shares of money market mutual or similar funds which invest exclusively in
assets satisfying the requirements of clauses (a) through (f) of this definition; or (h) money
market funds that (i) comply with the criteria set forth in

3

 

Securities and Exchange Commission Rule 2a-7 under the Investment Company Act of 1940, as
amended, (ii) are rated AAA by S&P and Aaa by Moody’s and (iii) have portfolio assets of at least
$5,000,000,000.

     “Closing Date”: the date on which the conditions precedent set forth in Section 6.1
shall have been satisfied.

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

     “Collateral”: all property of the Loan Parties, now owned or hereafter acquired, upon
which a Lien is purported to be created by any First Lien Security Document.

     “Commitment”: as to any Lender, the sum of the First Lien Term Commitment and the
Revolving Commitment of such Lender.

     “Commitment Fee Rate”: 0.50% per annum.

     “Commonly Controlled Entity”: an entity, whether or not incorporated, that is under
common control with Holdings within the meaning of Section 4001 of ERISA or is part of a group that
includes Holdings and that is treated as a single employer under Section 414 of the Code.

     “Compliance Certificate”: a certificate duly executed by a Responsible Officer of
Holdings substantially in the form of Exhibit B.

     “Conduit Lender”: any special purpose entity organized and administered by any Lender
for the purpose of making Loans otherwise required to be made by such Lender and designated by such
Lender in a written instrument, subject to the consent of the Administrative Agent (which consent
shall not be unreasonably withheld); provided, that the designation by any Lender of a
Conduit Lender shall not relieve the designating Lender of any of its obligations to fund a Loan
under this Agreement if, for any reason, its Conduit Lender fails to fund any such Loan, and the
designating Lender (and not the Conduit Lender) shall have the sole right and responsibility to
deliver all consents and waivers required or requested under this Agreement with respect to its
Conduit Lender, and provided, further, that no Conduit Lender shall (a) be entitled
to receive any greater amount pursuant to Section 4.9, 4.10, 4.11 or 11.5 than the designating
Lender would have been entitled to receive in respect of the extensions of credit made by such
Conduit Lender or (b) be deemed to have any Commitment.

     “Confidential Information Memorandum”: the Confidential Information Memorandum dated
October 2005 and furnished to the Lenders.

     “Consolidated Current Assets”: at any date, all amounts (other than cash and Cash
Equivalents) that would, in conformity with GAAP, be set forth opposite the caption “total current
assets” (or any like caption) on a consolidated balance sheet of Holdings and its Subsidiaries at
such date.

     “Consolidated Current Liabilities”: at any date, all amounts that would, in
conformity with GAAP, be set forth opposite the caption “total current liabilities” (or any like
caption) on a consolidated balance sheet of Holdings and its Subsidiaries at such date, but
excluding (a) the current portion of any Funded Debt of Holdings and its Subsidiaries and (b)
without duplication of clause (a) above, all Indebtedness consisting of Revolving Loans to the
extent otherwise included therein.

     “Consolidated EBITDA”: for any period, Consolidated Net Income for such period
plus, without duplication and to the extent reflected as a charge in the statement of such
Consolidated Net

4

 

Income for such period, the sum of (a) income tax expense, (b) interest expense, amortization
or writeoff of debt discount and debt issuance costs and commissions, discounts and other fees and
charges associated with Indebtedness (including the Loans), (c) depreciation and amortization
expense (including amortization expense related to competitive payments to customers resulting in
Capital Expenditures of Holdings or any of its Subsidiaries), (d) amortization of intangibles
(including, but not limited to, goodwill) and organization costs, (e) non-cash compensation
expenses arising from the issuance of stock, options to purchase stock and stock appreciation
rights to the management of Holdings or any of its Subsidiaries, (f) any extraordinary charges or
losses determined in accordance with GAAP, (g) any other non-cash charges, non-cash expenses or
non-cash losses of Holdings or any of its Subsidiaries for such period (excluding any such charge,
expense or loss incurred in the ordinary course of business that constitutes an accrual of or a
reserve for cash charges for any future period), (h) any pro forma adjustment
referred to in the Confidential Information Memorandum that had a favorable impact on Consolidated
EBITDA during the fiscal periods up to and including the fiscal year ending December 31, 2005 and
(i) any cash or non-cash expense incurred during the fiscal year ending December 31, 2005 in
connection with the termination of the employment of any officer or executive of the Borrowers or
their Affiliates, provided, however, that cash payments made in such period or in
any future period in respect of such non-cash charges, expenses or losses (excluding any such
charge, expense or loss incurred in the ordinary course of business that constitutes an accrual of
or a reserve for cash charges for any future period) shall be subtracted from Consolidated Net
Income in calculating Consolidated EBITDA in the period when such payments are made, and
minus, to the extent included in the statement of such Consolidated Net Income for such
period, the sum of (a) interest income, (b) any extraordinary income or gains determined in
accordance with GAAP, (c) any other non-cash income (excluding any items that represent the
reversal of any accrual of, or cash reserve for, anticipated cash charges in any prior period that
are described in the parenthetical to clause (g) above) and (d) any pro forma
adjustment referred to in the Confidential Information Memorandum that had an unfavorable impact on
Consolidated EBITDA during the fiscal periods up to and including the fiscal year ending December
31, 2005, all as determined on a consolidated basis. For the purposes of calculating Consolidated
EBITDA for any period of four consecutive fiscal quarters (each, a “Reference Period”)
pursuant to any determination of the Consolidated Leverage Ratio or the Consolidated First Lien
Leverage Ratio, (i) if at any time during such Reference Period Holdings or any Subsidiary shall
have made any Material Disposition, the Consolidated EBITDA for such Reference Period shall be
reduced by an amount equal to the Consolidated EBITDA (if positive) attributable to the property
that is the subject of such Material Disposition for such Reference Period or increased by an
amount equal to the Consolidated EBITDA (if negative) attributable thereto for such Reference
Period and (ii) if during such Reference Period Holdings or any Subsidiary shall have made a
Material Acquisition, Consolidated EBITDA for such Reference Period shall be calculated after
giving pro forma effect thereto as if such Material Acquisition occurred on the
first day of such Reference Period, provided that, with respect to the Acquisition and the
Contribution, such pro forma calculation shall be done in a manner consistent
with the pro forma
financial statements described in Section 5.1(a). As used in this definition, “Material
Acquisition” means any acquisition of property or series of related acquisitions of property
that (a) constitutes assets comprising all or substantially all of an operating unit of a business
or constitutes all or substantially all of the common stock of a Person and (b) involves the
payment of consideration by Holdings and its Subsidiaries in excess of $1,000,000; and
“Material Disposition” means any Disposition of property or series of related Dispositions
of property that yields gross proceeds to Holdings or any of its Subsidiaries in excess of
$1,000,000.

     “Consolidated First Lien Leverage Ratio”: as at the last day of any period, the ratio
of (a) Consolidated Total Debt (excluding any Second Lien Debt included therein) on such day to (b)
Consolidated EBITDA for such period.

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

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     “Consolidated Interest Expense”: for any period, total cash interest expense
(including that attributable to Capital Lease Obligations) of Holdings and its Subsidiaries for
such period with respect to all outstanding Indebtedness of Holdings and its Subsidiaries
(including all commissions, discounts and other fees and charges owed with respect to letters of
credit and bankers’ acceptance financing and net costs under Hedge Agreements in respect of
interest rates to the extent such net costs are allocable to such period in accordance with GAAP)
but excluding all amortized financing fees incurred in connection with the loans described in the
Existing Credit Agreement and with the First Lien Term Loans and the Second Lien Term Loans.

     “Consolidated Leverage Ratio”: as at the last day of any period, the ratio of (a)
Consolidated Total Debt on such day to (b) Consolidated EBITDA for such period.

     “Consolidated Net Income”: for any period, the consolidated net income (or loss) of
Holdings and its Subsidiaries, determined on a consolidated basis in accordance with GAAP;
provided that there shall be excluded (a) the income (or deficit) of any Person accrued
prior to the date it becomes a Subsidiary of Holdings or is merged into or consolidated with
Holdings or any of its Subsidiaries, (b) the income (or deficit) of any Person (other than a
Subsidiary of Holdings) in which Holdings or any of its Subsidiaries has an ownership interest,
except to the extent that any such income is actually received by Holdings or such Subsidiary in
the form of dividends or similar distributions and (c) the undistributed earnings of any Subsidiary
of Holdings to the extent that the declaration or payment of dividends or similar distributions by
such Subsidiary is not at the time permitted by the terms of any Contractual Obligation (other than
under any First Lien Loan Document) or Requirement of Law applicable to such Subsidiary.

     “Consolidated Total Debt”: at any date, the aggregate principal amount of all
Indebtedness of Holdings and its Subsidiaries at such date, determined on a consolidated basis in
accordance with GAAP.

     “Consolidated Working Capital”: at any date, the excess of Consolidated Current
Assets on such date over Consolidated Current Liabilities on such date.

     “Continuing Directors”: the directors of Holdings on the Closing Date, and each other
director, if, in each case, such other director’s nomination for election to the board of directors
of Holdings is recommended by at least 51% of the then Continuing Directors or such other director
receives the vote of the Permitted Investors in his or her election by the shareholders of
Holdings.

     “Contractual Obligation”: as to any Person, any provision of any security issued by
such Person or of any agreement, instrument or other undertaking to which such Person is a party or
by which it or any of its property is bound.

     “Control Agreement”: as defined in Section 7.12, including any Control Agreements
delivered on the Closing Date pursuant to
Section 6.1(p).

     “Control Investment Affiliate”: as to any Person, any other Person that (a) directly
or indirectly, is in control of, is controlled by, or is under common control with, such Person and
(b) is organized by such Person primarily for the purpose of making equity or debt investments in
one or more companies. For purposes of this definition, “control” of a Person means the power,
directly or indirectly, to direct or cause the direction of the management and policies of such
Person whether by contract or otherwise.

6

 

     “Default”: any of the events specified in Section 9, whether or not any requirement
for the giving of notice, the lapse of time, or both, has been satisfied.

     “Disposition”: with respect to any Property, any sale, lease, sale and leaseback,
assignment, conveyance, transfer or other disposition thereof. The terms “Dispose” and
“Disposed of” shall have correlative meanings.

     “Dollars” and “$”: dollars in lawful currency of the United States.

     “Domestic Subsidiary”: any Subsidiary of Holdings organized under the laws of any
jurisdiction within the United States.

     “ECF Percentage”: with respect to any fiscal year following the fiscal year in which
the Closing Date occurs, (a) 75%, to the extent the Consolidated Leverage Ratio as of last day of
such fiscal year is greater than 2.50 to 1.00, (b) 50%, to the extent the Consolidated Leverage
Ratio as of last day of such fiscal year is greater than 1.50 to 1.00 but less than or equal to
2.50 to 1.00, (c) 25%, to the extent the Consolidated Leverage Ratio as of last day of such fiscal
year is greater than 1.00 to 1.00 but less than or equal to 1.50 to 1.00 and (d) 0%, to the extent
the Consolidated Leverage Ratio as of last day of such fiscal year is less than or equal to 1.00 to
1.00.

     “Environmental Laws”: any and all foreign, Federal, state, local or municipal laws,
rules, orders, regulations, statutes, ordinances, codes, decrees, requirements of any Governmental
Authority or other Requirements of Law (including common law) regulating, relating to or imposing
liability or standards of conduct concerning protection of human health or the environment, as now
or may at any time hereafter be in effect.

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

     “Eurocurrency Reserve Requirements”: for any day as applied to a Eurodollar Loan, the
aggregate (without duplication) of the maximum rates (expressed as a decimal fraction) of reserve
requirements in effect on such day (including basic, supplemental, marginal and emergency reserves
under any regulations of the Board or other Governmental Authority having jurisdiction with respect
thereto) dealing with reserve requirements prescribed for eurocurrency funding (currently referred
to as “Eurocurrency Liabilities” in Regulation D of the Board) maintained by a member bank of the
Federal Reserve System.

     “Eurodollar Base Rate”: with respect to each day during each Interest Period
pertaining to a Eurodollar Loan, the rate per annum determined on the basis of the rate for
deposits in Dollars for a period equal to such Interest Period commencing on the first day of such
Interest Period appearing on Page 3750 of the Telerate screen as of 11:00 A.M., London time, two
Business Days prior to the beginning of such Interest Period. In the event that such rate does not
appear on Page 3750 of the Telerate screen (or otherwise on such screen), the “Eurodollar Base
Rate” shall be determined by reference to such other comparable publicly available service for
displaying eurodollar rates as may be selected by the Administrative Agent or, in the absence of
such availability, by reference to the rate at which the Administrative Agent is offered Dollar
deposits at or about 11:00 A.M., New York City time, two Business Days prior to the beginning of
such Interest Period in the interbank eurodollar market where its eurodollar and foreign currency
and exchange operations are then being conducted for delivery on the first day of such Interest
Period for the number of days comprised therein.

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     “Eurodollar Loans”: Loans that bear interest at a rate of interest based upon the
Eurodollar Rate.

     “Eurodollar Rate”: with respect to each day during each Interest Period pertaining to
a Eurodollar Loan, a rate per annum determined for such day in accordance with the following
formula (rounded upward to the nearest 1/100th of 1%):

Eurodollar Base Rate

1.00 — Eurocurrency Reserve Requirements

     “Eurodollar Tranche”: the collective reference to Eurodollar Loans of a Borrower
under a particular Facility the then current Interest Periods with respect to all of which begin on
the same date and end on the same later date (whether or not such Loans shall originally have been
made on the same day).

     “Event of Default”: any of the events specified in Section 9, provided that
any requirement for the giving of notice, the lapse of time, or both, has been satisfied.

     “Excess Cash Flow”: for any fiscal year of Holdings, the excess, if any, of (a) the
sum, without duplication, of (i) Consolidated Net Income for such fiscal year, (ii) the amount of
all non-cash charges (including depreciation and amortization but excluding any such charge,
expense or loss incurred in the ordinary course of business that constitutes an accrual of or a
reserve for cash charges for any future period, but including any reversal of any such accrual or
reserve) deducted in arriving at such Consolidated Net Income, (iii) decreases in Consolidated
Working Capital for such fiscal year, and (iv) the aggregate net amount of non-cash loss on the
Disposition of Property by Holdings and its Subsidiaries during such fiscal year (other than sales
of inventory in the ordinary course of business), to the extent deducted in arriving at such
Consolidated Net Income, over (b) the sum, without duplication, of (i) the amount of all
non-cash credits included in arriving at such Consolidated Net Income, (ii) the aggregate amount
actually paid by Holdings and its Subsidiaries in cash during such fiscal year on account of
Capital Expenditures (excluding the principal amount of Indebtedness incurred to finance such
expenditures (but including repayments of any such Indebtedness incurring during such period or any
prior period) and any such expenditures financed with the proceeds of any Reinvestment Deferred
Amount), (iii) the aggregate amount of all prepayments of Revolving Loans during such fiscal year
to the extent accompanying permanent optional reductions of the Revolving Commitments and all
optional prepayments of the First Lien Term Loans and Second Lien Term Loans during such fiscal
year (except to the extent refinanced), (iv) the aggregate amount of all regularly scheduled
principal payments and mandatory prepayments (to the extent made with gains from asset sales) of
Funded Debt (including the First Lien Term Loans and Second Term Lien Loans ) of Holdings and its
Subsidiaries made during such fiscal year (other than in respect of any revolving credit facility
to the extent there is not an equivalent permanent reduction in commitments thereunder) (except to
the extent refinanced), (v) increases in Consolidated Working Capital for such fiscal year, and
(vi) the aggregate net amount of non-cash gain on the Disposition of Property by Holdings and its
Subsidiaries during such fiscal year (other than sales of inventory in the ordinary course of
business), to the extent included in arriving at such Consolidated Net Income.

     “Excess Cash Flow Application Date”: as defined in Section 4.2.

     “Excluded Foreign Subsidiary”: any Foreign Subsidiary in respect of which either (a)
the pledge of all of the Capital Stock of such Subsidiary as Collateral or (b) the guaranteeing by
such Subsidiary of the Obligations, would, in the good faith judgment of the US Borrower, result in
adverse tax consequences to the US Borrower.

8

 

     “Excluded Indebtedness”: all Indebtedness permitted by clauses (a), (b), (c), (d),
(e), (f), (g) and (h) of Section 8.2.

     “Existing Credit Agreement”: the Credit Agreement dated as of October 1, 2004, among
the US Borrower (f/k/a Envision Worldwide Inc.), the BVI Borrower (f/k/a Envision Worldwide
Limited), Bear Stearns Corporate Lending Inc., as administrative agent, and the other financial
institutions named therein.

     “Facility”: each of (a) the First Lien Term Commitments and the First Lien Term Loans
made thereunder (the “First Lien Term Facility”) and (b) the Revolving Commitments and the
extensions of credit made thereunder (the “Revolving Facility”).

     “Federal Funds Effective Rate”: for any day, the weighted average of the rates on
overnight federal funds transactions with members of the Federal Reserve System arranged by federal
funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New
York, or, if such rate is not so published for any day that is a Business Day, the average of the
quotations for the day of such transactions received by the Reference Lender from three federal
funds brokers of recognized standing selected by it.

     “First Lien Collateral Agent”: JPMorgan Chase Bank, N.A., or any replacement therefor
in accordance with the terms of Section 10.13, in each case in its capacity as First Lien
Collateral Agent for the Administrative Agent and the Lenders under the First Lien Loan Documents.

     “First Lien Guarantee and Collateral Agreement”: the First Lien Guarantee and
Collateral Agreement to be executed and delivered by the First Lien Collateral Agent, Holdings, the
Borrowers and each Subsidiary Guarantor, substantially in the form of Exhibit A.

     “First Lien Loan Documents”: this Agreement, the First Lien Security Documents, the
Notes and any amendment, waiver, supplement or other modification to, and all other documents and
agreements executed in connection with, any of the foregoing.

     “First Lien Security Documents”: the collective reference to the First Lien Guarantee
and Collateral Agreement, any Control Agreement, the Mortgages, the Intercreditor Agreement and all
other security documents hereafter delivered to the Administrative Agent granting a Lien on any
property of any Person to secure the obligations and liabilities of any Loan Party to any First
Lien Lender under any First Lien Loan Document.

     “First Lien Term Commitment”: as to any Lender, the obligation of such Lender, if
any, to make a First Lien Term Loan to the US Borrower hereunder in a principal amount not to
exceed the amount set forth under the heading “First Lien Term Commitment” under such Lender’s name
on such Lender’s Addendum. The original aggregate amount of the First Lien Term Commitments is
$150,000,000.

     “First Lien Term Lender”: each Lender that has a First Lien Term Commitment or that
holds a First Lien Term Loan.

     “First Lien Term Loan”: as defined in Section 2.1.

     “First Lien Term Percentage”: as to any First Lien Term Lender at any time, the
percentage which such Lender’s First Lien Term Commitment then constitutes of the aggregate First
Lien Term Commitments (or, at any time after the Closing Date, the percentage which the aggregate
principal

9

 

amount of such Lender’s First Lien Term Loans then outstanding constitutes of the aggregate
principal amount of the First Lien Term Loans then outstanding).

     “Foreign Subsidiary”: any Subsidiary of Holdings that is not a Domestic Subsidiary.

     “Foster Grant”: AAi.FosterGrant, Inc., a Rhode Island corporation.

     “Funded Debt”: as to any Person, all Indebtedness of such Person that matures more
than one year from the date of its creation or matures within one year from such date but is
renewable or extendible, at the option of such Person, to a date more than one year from such date
or arises under a revolving credit or similar agreement that obligates the lender or lenders to
extend credit during a period of more than one year from such date, including all current
maturities and current sinking fund payments in respect of such Indebtedness whether or not
required to be paid within one year from the date of its creation and, in the case of either
Borrower, Indebtedness in respect of the Loans and the Second Lien Debt.

     “Funding Office”: the office of the Administrative Agent specified in Section 11.2 or
such other office as may be specified from time to time by the Administrative Agent as its funding
office by written notice to the US Borrower and the Lenders.

     “GAAP”: generally accepted accounting principles in the United States as in effect
from time to time.

     “Governmental Authority”: any nation or government, any state or other political
subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank
or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative
functions of or pertaining to government, any securities exchange and any self-regulatory
organization (including the National Association of Insurance Commissioners).

     “Group Members”: the collective reference to Holdings and its Subsidiaries.

     “Guarantee Obligation”: as to any Person (the “guaranteeing person”), any
obligation of (a) the guaranteeing person or (b) another Person (including any bank under any
letter of credit) to induce the creation of which the guaranteeing person has issued a
reimbursement, counterindemnity or similar obligation, in either case guaranteeing or in effect
guaranteeing any Indebtedness, leases, dividends or other obligations (the “primary
obligations”) of any other third Person (the “primary obligor”) in any manner, whether
directly or indirectly, including any obligation of the guaranteeing person, whether or not
contingent, (i) to purchase any such primary obligation or any property constituting direct or
indirect security therefor, (ii) to advance or supply funds (1) for the purchase or payment of any
such primary obligation or (2) to maintain working capital or equity capital of the primary obligor
or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase
property, securities or services primarily for the purpose of assuring the owner of any such
primary obligation of the ability of the primary obligor to make payment of such primary obligation
or (iv) otherwise to assure or hold harmless the owner of any such primary obligation against loss
in respect thereof; provided, however, that the term Guarantee Obligation shall not
include endorsements of instruments for deposit or collection in the ordinary course of business.
The amount of any Guarantee Obligation of any guaranteeing person shall be deemed to be the lower
of (a) an amount equal to the stated or determinable amount of the primary obligation in respect of
which such Guarantee Obligation is made and (b) the maximum amount for which such guaranteeing
person may be liable pursuant to the terms of the instrument embodying such Guarantee Obligation,
unless such primary obligation and the maximum amount for which such guaranteeing person may be
liable are not stated or determinable, in which case the amount of such

10

 

Guarantee Obligation shall be such guaranteeing person’s maximum reasonably anticipated
liability in respect thereof as determined by the relevant Borrower in good faith.

     “Guarantors”: the collective reference to Holdings and the Subsidiary Guarantors.

     “Hedge Agreements”: any agreement with respect to any swap, forward, future, cap,
collar or derivative transaction or option or similar agreement involving, or settled by reference
to, one or more rates, currencies, commodities, equity or debt instruments or securities, or
economic, financial or pricing indices or measures of economic, financial or pricing risk or value
or any similar transaction or any combination of these transactions; provided that no
phantom stock or similar plan providing for payments only on account of services provided by
current or former directors, officers, employees or consultants of Holdings or the Subsidiaries
shall be a Hedge Agreement.

     “Holdings”: FGX International Holdings Limited, a British Virgin Islands
international business company.

     “Indebtedness”: of any Person at any date, without duplication, (a) all indebtedness
of such Person for borrowed money, (b) all obligations of such Person for the deferred purchase
price of property or services (other than current trade payables incurred in the ordinary course of
such Person’s business), (c) all obligations of such Person evidenced by notes, bonds, debentures
or other similar instruments (excluding, however, any such instrument relating to the termination
of the employment of an officer or executive of the Borrowers or of any of their Affiliates during
the fiscal year ending December 31, 2005), (d) all indebtedness created or arising under any
conditional sale or other title retention agreement with respect to property acquired by such
Person (even though the rights and remedies of the seller or lender under such agreement in the
event of default are limited to repossession or sale of such property), (e) all Capital Lease
Obligations of such Person, (f) all obligations of such Person, contingent or otherwise, as an
account party or applicant under or in respect of acceptances, letters of credit, surety bonds or
similar arrangements, (g) the liquidation value of all preferred Capital Stock of such Person
redeemable by the holder thereof, (h) all Guarantee Obligations of such Person in respect of
obligations of the kind referred to in clauses (a) through (g) above, (i) all obligations of the
kind referred to in clauses (a) through (h) above secured by (or for which the holder of such
obligation has an existing right, contingent or otherwise, to be secured by) any Lien on property
(including accounts and contract rights) owned by such Person, whether or not such Person has
assumed or become liable for the payment of such obligation, and (j) for the purposes of Sections
8.2 and 9(e) only, all obligations of such Person in respect of Hedge Agreements. The Indebtedness
of any Person shall include the Indebtedness of any other entity (including any partnership in
which such Person is a general partner) to the extent such Person is liable therefor as a result of
such Person’s ownership interest in or other relationship with such entity, except to the extent
the terms of such Indebtedness expressly provide that such Person is not liable therefor.

     “Indemnified Liabilities”: as defined in Section 11.5.

     “Indemnitee”: as defined in Section 11.5.

     “Insolvency”: with respect to any Multiemployer Plan, the condition that such Plan is
insolvent within the meaning of Section 4245 of ERISA.

     “Insolvent”: pertaining to a condition of Insolvency.

     “Intellectual Property”: the collective reference to all rights, priorities and
privileges relating to intellectual property, whether arising under United States, multinational or
foreign laws or otherwise, including copyrights, copyright licenses, patents, patent licenses,
trademarks, trademark

11

 

licenses, technology, know-how and processes, and all rights to sue at law or in equity for
any infringement or other impairment thereof, including the right to receive all proceeds and
damages therefrom.

     “Intercreditor Agreement”: the Intercreditor Agreement to be executed and delivered
by the First Lien Collateral Agent, the Second Lien Collateral Agent and the Loan Parties,
substantially in the form of Exhibit I.

     “Interest Payment Date”: (a) as to any Base Rate Loan, the last day of each March,
June, September and December to occur while such Loan is outstanding and the final maturity date of
such Loan, (b) as to any Eurodollar Loan having an Interest Period of three months or less, the
last day of such Interest Period, (c) as to any Eurodollar Loan having an Interest Period longer
than three months, each day that is three months, or a whole multiple thereof, after the first day
of such Interest Period and the last day of such Interest Period and (d) as to any Loan (other than
any Revolving Loan that is a Base Rate Loan), the date of any repayment or prepayment made in
respect thereof.

     “Interest Period”: as to any Eurodollar Loan made to a Borrower, (a) initially, the
period commencing on the borrowing or conversion date, as the case may be, with respect to such
Eurodollar Loan and ending one, two, three or six or (if consented to by all Lenders under the
relevant Facility) nine or twelve months thereafter, as selected by such Borrower in its notice of
borrowing or notice of conversion, as the case may be, given with respect thereto; and (b)
thereafter, each period commencing on the last day of the next preceding Interest Period applicable
to such Eurodollar Loan and ending one, two, three or six or (if consented to by all Lenders under
the relevant Facility) nine or twelve months thereafter, as selected by such Borrower by
irrevocable notice to the Administrative Agent no later than 11:00 A.M., New York City time, on the
date that is three Business Days prior to the last day of the then current Interest Period with
respect thereto; provided that, all of the foregoing provisions relating to Interest
Periods are subject to the following:

     (i) if any Interest Period would otherwise end on a day that is not a Business
Day, such Interest Period shall be extended to the next succeeding Business Day
unless the result of such extension would be to carry such Interest Period into
another calendar month in which event such Interest Period shall end on the
immediately preceding Business Day;

     (ii) such Borrower may not select an Interest Period under a particular
Facility that would extend beyond the Revolving Termination Date or beyond the date
final payment is due on the First Lien Term Loans;

     (iii) 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 a calendar month; and

     (iv) such Borrower shall select Interest Periods so as not to require a payment
or prepayment of any Eurodollar Loan during an Interest Period for such Loan.

     “Investments”: as defined in Section 8.8.

     “IPO”: an initial public offering of the common equity of the US Borrower or the BVI
Borrower.

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     “Issuing Bank”: JPMorgan Chase Bank, N.A. or any other financial institution
designated by the L/C Lender as the “Issuing Bank” hereunder.

     “Judgment Currency”: as defined in Section 11.17.

     “Judgment Currency Conversion Date”: as defined in Section 11.17.

     “L/C Lender”: JPMorgan Chase Bank, N.A., in its capacity as the party responsible for
causing the issuance of Letters of Credit hereunder.

     “L/C Commitment”: $5,000,000.

     “L/C Fee Payment Date”: the last day of each March, June, September and December and
the last day of the Revolving Commitment Period.

     “L/C Obligations”: at any time, an amount equal to the sum of (a) the aggregate then
undrawn and unexpired amount of the then outstanding Letters of Credit and (b) the aggregate amount
of drawings under Letters of Credit that have not then been reimbursed pursuant to Section 3.9.

     “L/C Participants”: the collective reference to all the Revolving Lenders other than
the L/C Lender.

     “Lenders”: as defined in the preamble hereto; provided, that unless the
context otherwise requires, each reference herein to the Lenders shall be deemed to include any
Conduit Lender.

     “Letters of Credit”: as defined in Section 3.5(a).

     “Lien”: any mortgage, pledge, hypothecation, assignment, deposit arrangement,
encumbrance, lien (statutory or other), charge or other security interest or any preference,
priority or other security agreement or preferential arrangement of any kind or nature whatsoever
(including any conditional sale or other title retention agreement and any capital lease having
substantially the same economic effect as any of the foregoing).

     “Loan”: any loan made by any Lender pursuant to this Agreement.

     “Loan Parties”: each Group Member that is a party to a First Lien Loan Document.

     “Majority Facility Lenders”: with respect to any Facility, the holders of more than
50% of the aggregate unpaid principal amount of the First Lien Term Loans or the Total Revolving
Extensions of Credit, as the case may be, outstanding under such Facility (or, in the case of the
Revolving Facility, prior to any termination of the Revolving Commitments, the holders of more than
50% of the Total Revolving Commitments).

     “Material Adverse Effect”: a material adverse effect on (a) the business, assets,
property, condition (financial or otherwise), results of operations or prospects of Holdings and
its Subsidiaries, taken as a whole, or (b) the validity or enforceability of this Agreement or any
of the other First Lien Loan Documents or the rights or remedies of the Agents or the Lenders
hereunder or thereunder.

     “Materials of Environmental Concern”: any gasoline or petroleum (including crude oil
or any fraction thereof) or petroleum products or any hazardous or toxic substances, materials or
wastes,

13

 

defined or regulated as such in or under any Environmental Law, including asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.

     “Mexican Joint Venture”: AAi./JOSKE’s S. de R.L. de C.V., a Mexican limited liability
company.

     “Milberg Factoring Agreements”: (a) the Amended and Restated Account Receivable
Non-Notification Non-Lending Factoring Agreement, dated as of January 30, 2003, as amended, among
FosterGrant, AAi.FosterGrant of Canada Co. and Milberg and (b) the Account Receivable
Non-Notification Non-Lending Factoring Agreement, dated as of October 1, 2004, between Magnivision,
Inc and Milberg, each as in effect on the date hereof.

     “Milberg”: Milberg Factors, Inc.

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

     “Mortgaged Properties”: (a) the real properties listed on Schedule 1.1 and (b) the
real properties covered by any Mortgage delivered pursuant to Section 7.10(b), in each case, as to
which the First Lien Collateral Agent, for the benefit of the Lenders, shall be granted a Lien
pursuant to the Mortgages.

     “Mortgages”: each of the mortgages and deeds of trust made by any Loan Party in favor
of, or for the benefit of, the First Lien Collateral Agent, for the benefit of the Lenders,
substantially in the form of Exhibit D (with such changes thereto as shall be advisable under the
law of the jurisdiction in which such mortgage or deed of trust is to be recorded).

     “Multiemployer Plan”: a Plan that is a multiemployer plan as defined in Section
4001(a)(3) of ERISA.

     “Net Cash Proceeds”: (a) in connection with any Asset Sale or any Recovery Event,
the proceeds thereof in the form of cash and Cash Equivalents (including any such proceeds received
by way of deferred payment of principal pursuant to a note or installment receivable or purchase
price adjustment receivable or by the Disposition of any non-cash consideration received in
connection therewith or otherwise, but only as and when received) of such Asset Sale or Recovery
Event, net of attorneys’ fees, accountants’ fees, investment banking fees, amounts required to be
applied to the repayment of Indebtedness secured by a Lien expressly permitted hereunder on any
asset that is the subject of such Asset Sale or Recovery Event (other than any Lien pursuant to a
First Lien Security Document and the Second Lien Security Documents) and other customary fees and
expenses actually incurred in connection therewith and net of taxes paid or reasonably estimated to
be payable as a result thereof (after taking into account any available tax credits or deductions
and any tax sharing arrangements) and (b) in connection with any issuance or sale of Capital Stock,
any capital contribution or any incurrence of Indebtedness, the cash proceeds received from such
issuance, contribution or incurrence, net of attorneys’ fees, investment banking fees, accountants’
fees, underwriting discounts and commissions and other customary fees and expenses actually
incurred in connection therewith.

     “Non-Excluded Taxes”: as defined in Section 4.10(a).

     “Non-U.S. Lender”: as defined in Section 4.10(d).

     “Notes”: the collective reference to any promissory note evidencing Loans.

14

 

     “Obligations”: the unpaid principal of and interest on (including interest accruing
after the maturity of the Loans and Reimbursement Obligations and interest accruing after the
filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to either Borrower, whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding) the Loans and all other obligations and liabilities of the
Borrowers to any Agent or to any Lender (or, in the case of Specified Hedge Agreements, any
affiliate of any Lender), whether direct or indirect, absolute or contingent, due or to become due,
or now existing or hereafter incurred, which may arise under, out of, or in connection with, this
Agreement, any other First Lien Loan Document, the Letters of Credit, any Specified Hedge Agreement
or any other document made, delivered or given in connection herewith or therewith, whether on
account of principal, interest, reimbursement obligations, fees, indemnities, costs, expenses
(including all fees, charges and disbursements of counsel to any Agent or to any Lender that are
required to be paid by the Borrowers pursuant hereto) or otherwise; provided, that (i)
obligations of the Borrowers or any Subsidiary under any Specified Hedge Agreement shall be secured
and guaranteed pursuant to the First Lien Security Documents only to the extent that, and for so
long as, the other Obligations are so secured and guaranteed and (ii) any release of Collateral or
Guarantors effected in the manner permitted by this Agreement shall not require the consent of
holders of obligations under Specified Hedge Agreements.

     “Other Taxes”: any and all present or future stamp or documentary taxes or any other
excise or property taxes, charges or similar levies arising from any payment made hereunder or from
the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any
other First Lien Loan Document other than any such taxes, charges or similar levies arising from an
assignment of, or a sale of a participation in, all or a portion of a Lender’s rights and
obligations under this Agreement.

     “Participant”: as defined in Section 11.6(c).

     “PBGC”: the Pension Benefit Guaranty Corporation established pursuant to Subtitle A
of Title IV of ERISA (or any successor).

     “Permitted Investors”: the collective reference to the Sponsor and its Control
Investment Affiliates.

     “Person”: an individual, partnership, corporation, limited liability company,
business trust, joint stock company, trust, unincorporated association, joint venture, Governmental
Authority or other entity of whatever nature.

     “Plan”: at a particular time, any employee benefit plan that is covered by ERISA and
in respect of which Holdings or a Commonly Controlled Entity is (or, if such plan were terminated
at such time, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in
Section 3(5) of ERISA.

     “Pricing Grid”: the table set forth below.

	 	 	 	 	 	 	 	 	 
	 	Consolidated

Leverage Ratio
	 	 	Applicable Margin for

Base Rate Loans
	 	 	Applicable Margin for

Eurodollar Loans	 
	 	< 3.75 to 1.00
	 	 	2.50%
	 	 	3.50%	 
	 

     For the purposes of the Pricing Grid, changes in the Applicable Margin resulting from changes
in the Consolidated Leverage Ratio shall become effective on the date (the “Adjustment
Date”) that is three Business Days after the date on which financial statements are delivered
to the Lenders

15

 

pursuant to Section 7.1 and shall remain in effect until the next change to be effected
pursuant to this paragraph. If any financial statements referred to above are not delivered within
the time periods specified in Section 7.1, then, until the date that is three Business Days after
the date on which such financial statements are delivered, the highest rate set forth in each
column of the Pricing Grid shall apply. Each determination of the Consolidated Leverage Ratio
pursuant to the Pricing Grid shall be made in a manner consistent with the determination thereof
pursuant to Section 8.1.

     “Pro Forma Balance Sheet”: as defined in Section 5.1(a).

     “Projections”: as defined in Section 7.2(c).

     “Properties”: as defined in Section 5.17(a).

     “Property”: any right or interest in or to property of any kind whatsoever, whether
real, personal or mixed and whether tangible or intangible, including, without limitation, Capital
Stock.

     “Recovery Event”: any settlement of or payment in respect of any property or casualty
insurance claim or any condemnation proceeding relating to any asset of any Group Member.

     “Reference Lender”: JPMorgan Chase Bank, N.A.

     “Register”: as defined in Section 11.6(b).

     “Register of Mortgages, Charges and Other Encumbrances”: a register in which a
British Virgin Islands international business company enters details of any security interest
granted in or over any of its assets.

     “Regulation U”: Regulation U of the Board as in effect from time to time.

     “Reimbursement Obligation”: with respect to a Borrower, the obligation of such
Borrower to reimburse the L/C Lender pursuant to Section 3.9 for amounts drawn under Letters of
Credit issued for its account.

     “Reinvestment Deferred Amount”: with respect to any Reinvestment Event, the aggregate
Net Cash Proceeds received by any Group Member in connection therewith that are not applied to
prepay the First Lien Term Loans or reduce the Revolving Commitments pursuant to Section 4.2(c) as
a result of the delivery of a Reinvestment Notice.

     “Reinvestment Event”: any Asset Sale or Recovery Event in respect of which either
Borrower has delivered a Reinvestment Notice.

     “Reinvestment Notice”: a written notice executed by a Responsible Officer of either
Borrower stating that no Event of Default has occurred and is continuing and that the Borrowers
(directly or indirectly through a Subsidiary) intend and expect to use all or a specified portion
of the Net Cash Proceeds of an Asset Sale or Recovery Event to acquire or repair fixed or capital
assets useful in its business or, in the case of a Recovery Event, to repair or replace the assets
which were the subject of such Recovery Event.

     “Reinvestment Prepayment Amount”: with respect to any Reinvestment Event, the
Reinvestment Deferred Amount relating thereto less any amount expended prior to the relevant
Reinvestment Prepayment Date to acquire or repair fixed or capital assets useful in any Group
Member’s

16

 

business or, in the case of a Recovery Event, to repair or replace the assets which were the
subject of the relevant Recovery Event.

     “Reinvestment Prepayment Date”: with respect to any Reinvestment Event, the earlier
of (a) the date occurring 360 days after such Reinvestment Event and (b) the date on which either
Borrower shall have determined not to, or shall have otherwise ceased to, acquire or repair fixed
or capital assets useful in any Group Member’s business or, in the case of a Recovery Event, repair
or replace the assets which were the subject of the relevant Recovery Event with all or any portion
of the relevant Reinvestment Deferred Amount.

     “Reorganization”: with respect to any Multiemployer Plan, the condition that such
plan is in reorganization within the meaning of Section 4241 of ERISA.

     “Reportable Event”: any of the events set forth in Section 4043(b) of ERISA, other
than those events as to which the thirty day notice period is waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg. § 4043.

     “Required Lenders”: at any time, the holders of more than 50% of (a) until the
Closing Date, the Commitments then in effect and (b) thereafter, the sum of (i) the aggregate
unpaid principal amount of the First Lien Term Loans then outstanding and (ii) the Total Revolving
Commitments then in effect or, if the Revolving Commitments have been terminated, the Total
Revolving Extensions of Credit then outstanding.

     “Requirement of Law”: as to any Person, the Certificate of Incorporation and By-Laws
or other organizational or governing documents of such Person, and any law, treaty, rule or
regulation or determination of an arbitrator or a court or other Governmental Authority, in each
case applicable to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.

     “Responsible Officer”: with respect to Holdings or either Borrower, as applicable,
the chief executive officer, president or chief financial officer of Holdings or either Borrower,
as applicable, but in any event, with respect to financial matters, the chief financial officer of
Holdings or either Borrower, as applicable.

     “Restricted Payments”: as defined in Section 8.6.

     “Revolving Commitment”: as to any Lender, the obligation of such Lender, if any, to
make Revolving Loans and participate in Letters of Credit in an aggregate principal and/or face
amount not to exceed the amount set forth under the heading “Revolving Commitment” under such
Lender’s name on such Lender’s Addendum or in the Assignment and Assumption pursuant to which such
Lender became a party hereto, as the same may be changed from time to time pursuant to the terms
hereof. The original amount of the Total Revolving Commitments is $15,000,000.

     “Revolving Commitment Period”: the period from and including the Closing Date to the
Revolving Termination Date.

     “Revolving Extensions of Credit”: as to any Revolving Lender at any time, an amount
equal to the sum of (a) the aggregate principal amount of all Revolving Loans held by such Lender
then outstanding and (b) such Lender’s Revolving Percentage multiplied by the L/C Obligations then
outstanding.

17

 

     “Revolving Lender”: each Lender that has a Revolving Commitment or that holds
Revolving Loans.

     “Revolving Loans”: as defined in Section 3.1(a).

     “Revolving Percentage”: as to any Revolving Lender at any time, the percentage which
such Lender’s Revolving Commitment then constitutes of the Total Revolving Commitments (or, at any
time after the Revolving Commitments shall have expired or terminated, the percentage which the
aggregate principal amount of such Lender’s Revolving Loans then outstanding constitutes of the
aggregate principal amount of the Revolving Loans then outstanding).

     “Revolving Termination Date”: December 9, 2010.

     “S&P”: Standard & Poor’s Ratings Services.

     “SEC”: the Securities and Exchange Commission, any successor thereto and any
analogous Governmental Authority.

     “Second Lien Collateral Agent”: Wilmington Trust Company, or any replacement
therefor, in each case in its capacity as Second Lien Collateral Agent for the administrative agent
and the lenders under the Second Lien Loan Documents.

     “Second Lien Credit Agreement”: the Second Lien Credit Agreement, dated as of December
9, 2005, among the Borrowers, the several agents, banks and other financial institutions or
entities from time to time parties thereto and JPMorgan Chase Bank, N.A., as administrative agent.

     “Second Lien Debt”: Indebtedness outstanding under the Second Lien Credit Agreement.

     “Second Lien Guarantee and Collateral Agreement”: the Second Lien Guarantee and
Collateral Agreement to be executed and delivered by the Second Lien Collateral Agent, Holdings,
the Borrowers and each Subsidiary Guarantor.

     “Second Lien Loan Documents”: the Second Lien Credit Agreement, the Second Lien
Security Documents, and notes issued pursuant to the Second Lien Credit Agreement and any
amendment, waiver, supplement or other modification to, and all other documents and agreements
executed in connection with, any of the foregoing.

     “Second Lien Security Documents”: the collective reference to the Second Lien
Guarantee and Collateral Agreement, any Control Agreement, any mortgage delivered to the Second
Lien Collateral Agent pursuant to the Second Lien Credit Agreement, the Intercreditor Agreement and
all other security documents hereafter delivered to the Second Lien Collateral Agent granting a
Lien on any property of any Person to secure the obligations and liabilities of any “Loan Party” to
any “Second Lien Lender” (as such terms are defined in the Second Lien Credit Agreement) under any
Second Lien Loan Document.

     “Single Employer Plan”: any Plan that is covered by Title IV of ERISA, but that is
not a Multiemployer Plan.

     “Solvent”: when used with respect to any Person, means that, as of any date of
determination, (a) the amount of the “present fair saleable value” of the assets of such Person
will, as of such date, exceed the amount of all “liabilities of such Person, contingent or
otherwise”, as of such date,

18

 

as such quoted terms are determined in accordance with applicable federal and state laws
governing determinations of the insolvency of debtors, (b) the present fair saleable value of the
assets of such Person will, as of such date, be greater than the amount that will be required to
pay the liability of such Person on its debts as such debts become absolute and matured, (c) such
Person will not have, as of such date, an unreasonably small amount of capital with which to
conduct its business, and (d) such Person will be able to pay its debts as they mature. For
purposes of this definition, (i) “debt” means liability on a “claim”, and (ii) “claim” means any
(x) right to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated,
fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured
or (y) right to an equitable remedy for breach of performance if such breach gives rise to a right
to payment, whether or not such right to an equitable remedy is reduced to judgment, fixed,
contingent, matured or unmatured, disputed, undisputed, secured or unsecured.

     “Specified Change of Control”: any of the events described in clauses (i) and (ii) of
Section 9(l) of the Second Lien Credit Agreement.

     “Specified Hedge Agreement”: any Hedge Agreement (a) entered into by (i) either
Borrower or any of its Subsidiaries and (ii) any Agent or Lender or any affiliate thereof, as
counterparty and (b) that has been designated by such Agent or Lender, as the case may be, and
either Borrower, by notice to the Administrative Agent, as a Specified Hedge Agreement. The
designation of any Hedge Agreement as a Specified Hedge Agreement shall not create in favor of the
Agent, Lender or affiliate thereof that is a party thereto any rights in connection with the
management or release of any Collateral or of the obligations of any Guarantor under any First Lien
Security Document.

     “Sponsor”: Berggruen Holdings, Inc.

     “Subsidiary”: as to any Person, a corporation, partnership, limited liability company
or other entity of which shares of stock or other ownership interests having ordinary voting power
(other than stock or such other ownership interests having such power only by reason of the
happening of a contingency) to elect a majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the management of which is
otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such
Person. Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this
Agreement shall refer to a Subsidiary or Subsidiaries of Holdings.

     “Subsidiary Guarantor”: each Subsidiary of Holdings other than (a) any Excluded
Foreign Subsidiary and (b) the Borrowers.

     “Syndication Agent”: as defined in the preamble to this Agreement.

     “Total Revolving Commitments”: at any time, the aggregate amount of the Revolving
Commitments then in effect.

     “Total Revolving Extensions of Credit”: at any time, the aggregate amount of the
Revolving Extensions of Credit of the Revolving Lenders outstanding at such time.

     “Transaction”: the collective reference to (i) the dividend to be paid by the
Borrowers to Holdings and other direct and indirect holders of their Capital Stock in an amount not
to exceed $100,000,000 in the aggregate, (ii) the refinancing and replacement by the Borrowers of
the Existing Credit Agreement and the repayment of certain existing Indebtedness in an amount not
to exceed $98,000,000 in the aggregate and (iii) the payment of related fees and expenses in
connection therewith.

19

 

     “Transferee”: any Assignee or Participant.

     “Type”: as to any Loan, its nature as a Base Rate Loan or a Eurodollar Loan.

     “United States”: the United States of America.

     1.2. Other Definitional Provisions. i) Unless otherwise specified therein, all terms
defined in this Agreement shall have the defined meanings when used in the other First Lien Loan
Documents or any certificate or other document made or delivered pursuant hereto or thereto.

     (a) As used herein and in the other First Lien Loan Documents, and any certificate or other
document made or delivered pursuant hereto or thereto, (i) accounting terms relating to any Group
Member not defined in Section 1.1 and accounting terms partly defined in Section 1.1, to the extent
not defined, shall have the respective meanings given to them under GAAP, (ii) the words “include”,
“includes” and “including” shall be deemed to be followed by the phrase “without limitation”, (iii)
the word “incur” shall be construed to mean incur, create, issue, assume, become liable in respect
of or suffer to exist (and the words “incurred” and “incurrence” shall have correlative meanings),
(iv) the words “asset” and “property” shall be construed to have the same meaning and effect and to
refer to any and all tangible and intangible assets and properties, including cash, Capital Stock,
securities, revenues, accounts, leasehold interests and contract rights, and (v) references to
agreements or other Contractual Obligations shall, unless otherwise specified, be deemed to refer
to such agreements or Contractual Obligations as amended, supplemented, restated or otherwise
modified from time to time (subject to any applicable restrictions hereunder).

     (b) The words “hereof”, “herein” and “hereunder” and words of similar import when used in this
Agreement shall refer to this Agreement as a whole and not to any particular provision of this
Agreement, and Section, Schedule and Exhibit references are to this Agreement unless otherwise
specified.

     (c) The meanings given to terms defined herein shall be equally applicable to both the
singular and plural forms of such terms.

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

SECTION 2. AMOUNT AND TERMS OF TERM COMMITMENTS

     2.1. First Lien Term Commitments(a) . Subject to the terms and conditions hereof,
each First Lien Term Lender severally agrees to make a first lien term loan (a “First Lien Term
Loan”) to the US Borrower on the Closing Date in the amount of the First Lien Term Commitment
of such Lender. The First Lien Term Loans may from time to time be Eurodollar Loans or Base Rate
Loans, as determined by the US Borrower and notified to the Administrative Agent in accordance with
Sections 2.2 and 4.3.

20

 

     2.2. Procedure for First Lien Term Loan Borrowing. The US Borrower shall give the
Administrative Agent irrevocable notice (which notice must be received by the Administrative Agent
prior to 10:00 A.M., New York City time, one Business Day prior to the anticipated Closing Date)
requesting that the First Lien Term Lenders make the First Lien Term Loans on the Closing Date and
specifying the amount to be borrowed. The First Lien Term Loans made on the Closing Date shall
initially be Base Rate Loans. Upon receipt of such notice the Administrative Agent shall promptly
notify each First Lien Term Lender thereof. Not later than 12:00 Noon, New York City time, on the
relevant Borrowing Date, each First Lien Term Lender shall make available to the Administrative
Agent at the Funding Office an amount in immediately available funds equal to the First Lien Term
Loans to be made by such Lender. The Administrative Agent shall credit the account of the US
Borrower in respect of the First Lien Term Loans made to the US Borrower on the books of such
office of the Administrative Agent with the aggregate of the amounts made available to the
Administrative Agent in immediately available funds.

     2.3. Repayment of First Lien Term Loans. The First Lien Term Loan of each First Lien
Term Lender shall mature (and the US Borrower shall repay the First Lien Term Loan of such First
Lien Term Lender) in 24 installments, commencing on March 31, 2007, in the amounts and on the dates
set forth below, with such First Lien Term Lender’s portion of each such installment being in an
amount equal to such First Lien Term Lender’s First Lien Term Percentage of such installment:

	 	 	 	 	 
	Installment Date	 	Principal Amount
	March 31, 2007

	 	$	1,500,000	 
	June 30, 2007

	 	$	1,500,000	 
	September 30, 2007

	 	$	1,500,000	 
	December 31, 2007

	 	$	1,500,000	 
	March 31, 2008

	 	$	1,875,000	 
	June 30, 2008

	 	$	1,875,000	 
	September 30, 2008

	 	$	1,875,000	 
	December 31, 2008

	 	$	1,875,000	 
	March 31, 2009

	 	$	2,625,000	 
	June 30, 2009

	 	$	2,625,000	 
	September 30, 2009

	 	$	2,625,000	 
	December 31, 2009

	 	$	2,625,000	 
	March 31, 2010

	 	$	2,625,000	 
	June 30, 2010

	 	$	2,625,000	 
	September 30, 2010

	 	$	2,625,000	 
	December 31, 2010

	 	$	2,625,000	 
	March 31, 2011

	 	$	2,625,000	 
	June 30, 2011

	 	$	2,625,000	 
	September 30, 2011

	 	$	2,625,000	 
	December 31, 2011

	 	$	2,625,000	 
	March 31, 2012

	 	$	2,625,000	 
	June 30, 2012

	 	$	2,625,000	 
	September 30, 2012

	 	$	2,625,000	 

The final installment shall be due on December 9, 2012 in an amount necessary to repay in full the
then unpaid principal amount of the First Lien Term Loans.

21

 

SECTION 3. AMOUNT AND TERMS OF REVOLVING COMMITMENTS

     3.1. Revolving Commitments. ii) Subject to the terms and conditions hereof, each
Revolving Lender severally agrees to make revolving credit loans (“Revolving Loans”) to the
Borrowers from time to time during the Revolving Commitment Period in an aggregate principal amount
at any one time outstanding which, when added to such Lender’s Revolving Percentage multiplied by
the L/C Obligations then outstanding, does not exceed the amount of such Lender’s Revolving
Commitment; provided that no Revolving Loans shall be made on the Closing Date. During the
Revolving Commitment Period, each Borrower may use the Revolving Commitments by borrowing,
prepaying and reborrowing the Revolving Loans in whole or in part, all in accordance with the terms
and conditions hereof. The Revolving Loans may from time to time be Eurodollar Loans or Base Rate
Loans, as determined by the relevant Borrower and notified to the Administrative Agent in
accordance with Sections 3.2 and 4.3.

     (a) The Borrowers jointly and severally agree to repay all outstanding Revolving Loans on the
Revolving Termination Date.

     3.2. Procedure for Revolving Loan Borrowing. Each Borrower may borrow under the
Revolving Commitments during the Revolving Commitment Period on any Business Day other than the
Closing Date, provided that such Borrower shall give the Administrative Agent irrevocable
notice (which notice must be received by the Administrative Agent (a) prior to 12:00 Noon, New York
City time, three Business Days prior to the requested Borrowing Date, in the case of Eurodollar
Loans, or (b) prior to 11:00 A.M., New York City time, on the requested Borrowing Date, in the case
of Base Rate Loans), specifying (i) the amount and Type of Revolving Loans to be borrowed, (ii) the
requested Borrowing Date and (iii) in the case of Eurodollar Loans, the respective amounts of each
such Type of Loan and the respective lengths of the initial Interest Period therefor. Each
borrowing (other than a borrowing pursuant to Section 3.9) under the Revolving Commitments shall be
in an amount equal to (x) in the case of Base Rate Loans, $500,000 or a whole multiple thereof (or,
if the then aggregate Available Revolving Commitments are less than $500,000, such lesser amount)
and (y) in the case of Eurodollar Loans, $1,000,000 or a whole multiple of $100,000 in excess
thereof. Upon receipt of any such notice, the Administrative Agent shall promptly notify each
Revolving Lender thereof. Each Revolving Lender will make the amount of its pro
rata share of each borrowing available to the Administrative Agent for the account of such
Borrower at the Funding Office prior to 12:00 Noon, New York City time, on the Borrowing Date
requested by such Borrower in funds immediately available to the Administrative Agent. Such
borrowing will then be made available to such Borrower by the Administrative Agent crediting the
account of such Borrower on the books of such office with the aggregate of the amounts made
available to the Administrative Agent by the Revolving Lenders and in like funds as received by the
Administrative Agent.

     3.3. Commitment Fees, etc. iii) The Borrowers jointly and severally agree to pay to
the Administrative Agent for the account of each Revolving Lender a commitment fee for the period
from and including the Closing Date to the last day of the Revolving Commitment Period, computed at
the Commitment Fee Rate on the average daily amount of the Available Revolving Commitment of such
Lender during the period for which payment is made, payable quarterly in arrears on the last day of
each March, June, September and December and on the Revolving Termination Date, commencing on the
first of such dates to occur after the date hereof.

     (a) The Borrowers jointly and severally agree to pay to the Administrative Agent and the
Syndication Agent the fees in the amounts and on the dates previously agreed to in writing by the
Borrowers, the Administrative Agent and the Syndication Agent by letter dated October 19, 2005,
subject

22

 

to the reduction previously agreed to by the Borrowers, the Administrative Agent and the
Syndication Agent and as reflected in the wire transfer instructions on the Closing Date.

     3.4. Termination or Reduction of Revolving Commitments. The Borrowers shall have the
right, upon not less than three Business Days’ notice to the Administrative Agent, to terminate the
Revolving Commitments or, from time to time, to reduce the amount of the Revolving Commitments;
provided that no such termination or reduction of Revolving Commitments shall be permitted
if, after giving effect thereto and to any prepayments of the Revolving Loans made on the effective
date thereof, the Total Revolving Extensions of Credit would exceed the Total Revolving
Commitments. Any such reduction shall be in an amount equal to $500,000, or a whole multiple
thereof, and shall reduce permanently the Revolving Commitments then in effect.

     3.5. L/C Commitment. iv) Subject to the terms and conditions hereof, the L/C Lender,
in reliance on the agreements of the other Revolving Lenders set forth in Section 3.8(a), agrees to
cause the Issuing Bank to issue letters of credit (“Letters of Credit”) for the account of
either Borrower on any Business Day during the Revolving Commitment Period in such form as may be
approved from time to time by the L/C Lender and the Issuing Bank; provided that the L/C
Lender shall have no obligation to cause any Letter of Credit to be issued if, after giving effect
to such issuance, (i) the L/C Obligations would exceed the L/C Commitment or (ii) the aggregate
amount of the Available Revolving Commitments would be less than zero. Each Letter of Credit shall
(i) be denominated in Dollars, and (ii) expire no later than the earlier of (x) the first
anniversary of its date of issuance and (y) the date that is five Business Days prior to the
Revolving Termination Date, provided that any Letter of Credit with a one-year term may
provide for the renewal thereof for additional one-year periods (which shall in no event extend
beyond the date referred to in clause (y) above).

     (a) The L/C Lender shall not at any time be obligated to cause any Letter of Credit to be
issued hereunder if such issuance would conflict with, or cause the L/C Lender, the Issuing Bank or
any L/C Participant to exceed any limits imposed by, any applicable Requirement of Law.

     3.6. Procedure for Issuance of Letter of Credit. Each Borrower may from time to time
request that the L/C Lender cause a Letter of Credit to be issued by delivering to the L/C Lender
and the Issuing Bank at its address for notices specified herein an Application therefor, completed
to the satisfaction of the L/C Lender and the Issuing Bank, and such other certificates, documents
and other papers and information as the L/C Lender and the Issuing Bank may request. Upon receipt
of any Application, the L/C Lender will notify the Administrative Agent of the amount, the
beneficiary and the requested expiration of the requested Letter of Credit, and upon receipt of
confirmation from the Administrative Agent that after giving effect to the requested issuance, the
Available Revolving Commitments would not be less than zero, the L/C Lender will cause such
Application and the certificates, documents and other papers and information delivered to it in
connection therewith to be processed by the L/C Lender and the Issuing Bank in accordance with its
customary procedures and shall promptly cause the Letter of Credit requested thereby to be issued
(but in no event shall the L/C Lender be required to cause any Letter of Credit to be issued
earlier than five Business Days after its receipt of the Application therefor and all such other
certificates, documents and other papers and information relating thereto) by causing the original
of such Letter of Credit to be issued to the beneficiary thereof or as otherwise may be agreed to
by the L/C Lender, the Issuing Bank and the relevant Borrower. The L/C Lender shall furnish a copy
of such Letter of Credit to the relevant Borrower (with a copy to the Administrative Agent)
promptly following the issuance thereof. The L/C Lender shall promptly furnish to the
Administrative Agent, which shall in turn promptly furnish to the Lenders, notice of the issuance
of each Letter of Credit (including the amount thereof).

23

 

     3.7. Fees and Other Charges. v) The Borrowers jointly and severally agree to pay a
fee on all outstanding Letters of Credit at a per annum rate equal to the Applicable Margin then in
effect with respect to Eurodollar Loans under the Revolving Facility, shared ratably among the
Revolving Lenders and payable quarterly in arrears on each L/C Fee Payment Date after the issuance
date. In addition, the Borrowers jointly and severally agree to pay to the L/C Lender for its own
account a fronting fee of 0.25% per annum on the undrawn and unexpired amount of each Letter of
Credit as agreed by the Borrowers and the L/C Lender, payable quarterly in arrears on each L/C Fee
Payment Date after the issuance date.

     (a) In addition to the foregoing fees, the Borrowers jointly and severally agree to pay or
reimburse the L/C Lender and the Issuing Bank, as the case may be, for such normal and customary
costs and expenses as are incurred or charged by the L/C Lender and the Issuing Bank, as the case
may be, in issuing, negotiating, effecting payment under, amending or otherwise administering any
Letter of Credit.

     3.8. L/C Participations. vi) The L/C Lender irrevocably agrees to grant and hereby
grants to each L/C Participant, and, to induce the L/C Lender to cause Letters of Credit to be
issued hereunder, each L/C Participant irrevocably agrees to accept and purchase and hereby accepts
and purchases from the L/C Lender, on the terms and conditions set forth below, for such L/C
Participant’s own account and risk an undivided interest equal to such L/C Participant’s Revolving
Percentage in the L/C Lender’s obligations and rights under and in respect of each Letter of Credit
issued hereunder and the amount of each draft paid by the Issuing Bank thereunder (which shall
include the L/C Lender’s obligation to reimburse such applicable Issuing Bank for the amount of
such drawing). Each L/C Participant unconditionally and irrevocably agrees with the L/C Lender
that, if a draft is paid under any Letter of Credit for which the L/C Lender is not reimbursed in
full by the Borrowers in accordance with the terms of this Agreement, such L/C Participant shall
pay to the Administrative Agent upon demand of the L/C Lender an amount equal to such L/C
Participant’s Revolving Percentage of the amount of such draft, or any part thereof, that is not so
reimbursed. The Administrative Agent shall promptly forward such amounts to the L/C Lender.

     (a) If any amount required to be paid by any L/C Participant to the Administrative Agent for
the account of the L/C Lender pursuant to Section 3.8(a) in respect of any unreimbursed portion of
any payment made by the L/C Lender to the Issuing Bank under any Letter of Credit is paid to the
Administrative Agent for the account of the L/C Lender within three Business Days after the date
such payment is due, such L/C Participant shall pay to the Administrative Agent for the account of
the L/C Lender on demand an amount equal to the product of (i) such amount, times (ii) the daily
average Federal Funds Effective Rate during the period from and including the date such payment is
required to the date on which such payment is immediately available to the L/C Lender, times (iii)
a fraction the numerator of which is the number of days that elapse during such period and the
denominator of which is 360. If any such amount required to be paid by any L/C Participant
pursuant to Section 3.8(a) is not made available to the Administrative Agent for the account of the
L/C Lender by such L/C Participant within three Business Days after the date such payment is due,
the L/C Lender shall be entitled to recover from such L/C Participant, on demand, such amount with
interest thereon calculated from such due date at the rate per annum applicable to Base Rate Loans
under the Revolving Facility. A certificate of the L/C Lender submitted to any L/C Participant
with respect to any amounts owing under this Section shall be conclusive in the absence of manifest
error.

     (b) Whenever, at any time after the L/C Lender has made payment under any Letter of Credit and
has received from any L/C Participant its pro rata share of such payment in
accordance with Section 3.8(a), the Administrative Agent or the L/C Lender receives any payment
related to such Letter of Credit (whether directly from the relevant Borrower or otherwise,
including proceeds of collateral

24

 

applied thereto by the Issuing Bank), or any payment of interest on account thereof, the
Administrative Agent or the L/C Lender, as the case may be, will distribute to such L/C Participant
its pro rata share thereof; provided, however, that in the event
that any such payment received by Administrative Agent or L/C Lender, as the case may be, shall be
required to be returned by the Administrative Agent or L/C Lender, such L/C Participant shall
return to the Administrative Agent for the account of the L/C Lender the portion thereof previously
distributed by the Administrative Agent or the L/C Lender, as the case may be, to it.

     3.9. Reimbursement Obligation of the Borrower. The Borrowers jointly and severally
agree to reimburse the L/C Lender on the Business Day next succeeding (or, if such notice is given
later than 11:00 A.M., on the second Business Day next succeeding) the Business Day on which the
L/C Lender notifies the Borrowers of the date and amount of a draft presented under any Letter of
Credit and paid by the Issuing Bank for the amount of (a) such draft so paid and (b) any taxes,
fees, charges or other costs or expenses incurred by the L/C Lender or the Issuing Bank in
connection with such payment. Each such payment to be made by the Borrower shall be made to the
L/C Lender at its address for notices referred to herein in Dollars and in immediately available
funds. Interest shall be payable on any and all amounts remaining unpaid by the Borrowers under
this Section from the date on which the relevant draft is paid until payment in full at the rate
set forth in (i) until the Business Day next succeeding the date of the relevant notice, Section
4.5(b) and (ii) thereafter, Section 4.5(c). Each drawing under any Letter of Credit shall (unless
an event of the type described in clause (i) or (ii) of Section 9(g) shall have occurred and be
continuing with respect to either Borrower, in which case the procedures specified in Section 3.8
for funding by L/C Participants shall apply) constitute a request by the relevant Borrower to the
Administrative Agent for a borrowing pursuant to Section 3.2 of Base Rate Loans in the amount of
such drawing. The Borrowing Date with respect to such borrowing shall be the first date on which a
borrowing of Revolving Loans could be made, pursuant to Section 3.2, if the Administrative Agent
had received a notice of such borrowing at the time the Administrative Agent receives notice from
the L/C Lender of such drawing under such Letter of Credit.

     3.10. Obligations Absolute. Each Borrower’s obligations under Section 3.9 shall be
absolute and unconditional under any and all circumstances and irrespective of any setoff,
counterclaim or defense to payment that such Borrower may have or have had against the L/C Lender,
the Issuing Bank any beneficiary of a Letter of Credit or any other Person. Each Borrower also
agrees with the L/C Lender that the L/C Lender shall not be responsible for, and such Borrower’s
Reimbursement Obligations under Section 3.9 shall not be affected by, among other things, the
validity or genuineness of documents or of any endorsements thereon, even though such documents
shall in fact prove to be invalid, fraudulent or forged, or any dispute between or among either
Borrower and any beneficiary of any Letter of Credit or any other party to which such Letter of
Credit may be transferred or any claims whatsoever of either Borrower against any beneficiary of
such Letter of Credit or any such transferee. The L/C Lender shall not be liable for any error,
omission, interruption or delay in transmission, dispatch or delivery of any message or advice,
however transmitted, in connection with any Letter of Credit, except for errors or omissions found
by a final and nonappealable decision of a court of competent jurisdiction to have resulted from
the gross negligence or willful misconduct of the Issuing Bank. Each Borrower agrees that any
action taken or omitted by the L/C Lender or the Issuing Bank under or in connection with any
Letter of Credit or the related drafts or documents, if done in the absence of gross negligence or
willful misconduct and in accordance with the standards of care specified in the Uniform Commercial
Code of the State of New York, shall be binding on such Borrower and shall not result in any
liability of the Issuing Bank or the L/C Lender to such Borrower. The Issuing Bank shall not have
any liability to the Borrower, the Administrative Agent or the Lenders in respect of any Letters of
Credit issued by it or any Letters of Credit requested to be issued by it, nor shall the Issuing
Bank owe any duty to any Person, or be deemed to have agreed, to issue any Letters of Credit (it
being understood that the Issuing Bank shall issue Letters of Credit, if at all, pursuant to
separate contractual arrangements with, and solely for the

25

 

benefit of, the L/C Lender and any duties, obligations or liabilities of the Issuing Bank
shall be only those set forth in such separate contractual arrangements).

     3.11. Letter of Credit Payments. If any draft shall be presented for payment under
any Letter of Credit, the L/C Lender shall promptly notify the relevant Borrower of the date and
amount thereof. The responsibility of the L/C Lender to the Borrowers in connection with any draft
presented for payment under any Letter of Credit shall, in addition to any payment obligation
expressly provided for in such Letter of Credit, be limited to causing the Issuing Bank to
determine that the documents (including each draft) delivered under such Letter of Credit in
connection with such presentment are substantially in conformity with such Letter of Credit.

     3.12. Applications. To the extent that any provision of any Application related to
any Letter of Credit is inconsistent with the provisions of this Section 3, the provisions of this
Section 3 shall govern and, in no event shall any provision of any such Application be effective to
create any Lien or impose any covenants or defaults of the types covered by Sections 7, 8 and 9 of
this Agreement.

SECTION 4. GENERAL PROVISIONS APPLICABLE

TO LOANS AND LETTERS OF CREDIT

     4.1. Optional Prepayments. vii) Each Borrower may at any time and from time to time
prepay the First Lien Term Loans, in whole or in part, without premium or penalty, upon irrevocable
notice delivered to the Administrative Agent no later than 11:00 A.M., New York City time, three
Business Days prior thereto, in the case of Eurodollar Loans, and no later than 11:00 A.M., New
York City time, one Business Day prior thereto, in the case of Base Rate Loans, which notice shall
specify the date and amount of prepayment and whether the prepayment is of Eurodollar Loans or Base
Rate Loans; provided, that if a Eurodollar Loan is prepaid on any day other than the last
day of the Interest Period applicable thereto, such Borrower shall also pay any amounts owing
pursuant to Section 4.11. Upon receipt of any such notice the Administrative Agent shall promptly
notify each relevant Lender thereof. If any such notice is given, the amount specified in such
notice shall be due and payable on the date specified therein, together with (except in the case of
Revolving Loans that are Base Rate Loans) accrued interest to such date on the amount prepaid.
Partial prepayments of First Lien Term Loans and Revolving Loans shall be in an aggregate principal
amount of $500,000 or a whole multiple thereof.

     (a) All voluntary prepayments of the First Lien Term Loans effected on or prior to the first
anniversary of the Closing Date with the proceeds of a substantially concurrent issuance of loans
under any secured credit facilities pursuant to this Agreement or otherwise (excluding a
refinancing of the Facilities outstanding under this Agreement in connection with another
transaction not permitted by this Agreement (as determined prior to giving effect to any amendment
or waiver of this Agreement being adopted in connection with such transaction), provided
that the primary purpose of such transaction is not to refinance Indebtedness hereunder at an
Applicable Margin or similar interest rate spread more favorable to the Borrowers), shall be
accompanied by a prepayment fee equal to 1.00% of the aggregate amount of such prepayment if the
Applicable Margin or similar interest rate spread applicable to such new loans is or, upon the
satisfaction of certain conditions, would be less than the Applicable Margin applicable to the
First Lien Term Loans as of the date hereof.

     4.2. Mandatory Prepayments and Commitment Reductions. viii) If any Indebtedness
shall be incurred by any Group Member (other than Excluded Indebtedness), an amount equal to 100%
of the Net Cash Proceeds thereof shall be applied on the date of such incurrence toward the
prepayment of the First Lien Term Loans and the reduction of the Revolving Commitments as set forth
in Section 4.2(e).

26

 

     (a) If any Capital Stock shall be issued by any Group Member, an amount equal to 100% of the
Net Cash Proceeds thereof shall be applied on the date of such issuance toward the prepayment of
the First Lien Term Loans and the reduction of the Revolving Commitments as set forth in Section
4.2(e); provided, however, that if after giving pro forma effect to
such issuance, the Consolidated Leverage Ratio as of the last day of the most recent period of four
consecutive fiscal quarters of Holdings for which financial reports have then been delivered
pursuant to Section 7.1 does not exceed 2.50 to 1.0, no prepayment shall be required pursuant to
this clause (b).

     (b) If on any date any Group Member shall receive Net Cash Proceeds from any Asset Sale or
Recovery Event then, unless a Reinvestment Notice shall be delivered in respect thereof, such Net
Cash Proceeds shall be applied on such date toward the prepayment of the First Lien Term Loans and
the reduction of the Revolving Commitments as set forth in Section 4.2(e); provided, that,
notwithstanding the foregoing, (i) the aggregate Net Cash Proceeds of Asset Sales that may be
excluded from the foregoing requirement pursuant to a Reinvestment Notice shall not exceed $500,000
in any fiscal year of Holdings and (ii) on each Reinvestment Prepayment Date, an amount equal to
the Reinvestment Prepayment Amount with respect to the relevant Reinvestment Event shall be applied
toward the prepayment of the First Lien Term Loans and the reduction of the Revolving Commitments
as set forth in Section 4.2(e).

     (c) If, for any fiscal year of Holdings commencing with the fiscal year ending December 31,
2006, there shall be Excess Cash Flow, the ECF Percentage of such Excess Cash Flow, shall be
applied on the relevant Excess Cash Flow Application Date, toward the prepayment of the First Lien
Term Loans and the reduction of the Revolving Commitments as set forth in Section 4.2(e). Each
such prepayment and commitment reduction shall be made on a date (an “Excess Cash Flow
Application Date”) no later than five days after the earlier of (i) the date on which the
financial statements of Holdings referred to in Section 7.1(a), for the fiscal year with respect to
which such prepayment is made, are required to be delivered to the Lenders and (ii) the date such
financial statements are actually delivered (to the extent such financial statements are delivered
later than the date on which such statements are required to be delivered pursuant to Section 7.1).

     (d) Amounts to be applied in connection with prepayments and Commitment reductions made
pursuant to foregoing clauses (a), (b), (c) and (d) of this Section 4.2 shall be applied,
first, to the prepayment in full of the First Lien Term Loans and, second, to
reduce permanently the Revolving Commitments, in each case in accordance with Section 4.8. Any
such reduction of the Revolving Commitments shall be accompanied by prepayment of the Revolving
Loans to the extent, if any, that the Total Revolving Extensions of Credit exceed the amount of the
Total Revolving Commitments as so reduced, provided that if the aggregate principal amount
of Revolving Loans then outstanding is less than the amount of such excess (because L/C Obligations
constitute a portion thereof), the Borrowers jointly and severally agree, to the extent of the
balance of such excess, to replace outstanding Letters of Credit and/or deposit an amount in cash
in a cash collateral account established with the Administrative Agent for the benefit of the
Lenders on terms and conditions satisfactory to the Administrative Agent. The application of any
prepayment pursuant to Section 4.2 shall be made, first, to Base Rate Loans and,
second, to Eurodollar Loans. Each prepayment of the Loans under Section 4.2 (except in the
case of Revolving Loans that are Base Rate Loans) shall be accompanied by accrued interest to the
date of such prepayment on the amount prepaid.

     4.3. Conversion and Continuation Options. ix) Each Borrower may elect from time to
time to convert Eurodollar Loans to Base Rate Loans by giving the Administrative Agent prior
irrevocable notice of such election no later than 11:00 A.M., New York City time, on the Business
Day preceding the proposed conversion date, provided that any such conversion of Eurodollar
Loans may only be made on the last day of an Interest Period with respect thereto. Each Borrower
may elect from time to

27

 

time to convert Base Rate Loans to Eurodollar Loans by giving the Administrative Agent prior
irrevocable notice of such election no later than 11:00 A.M., New York City time, on the third
Business Day preceding the proposed conversion date (which notice shall specify the length of the
initial Interest Period therefor), provided that no Base Rate Loan under a particular
Facility may be converted into a Eurodollar Loan when any Event of Default has occurred and is
continuing and the Administrative Agent or the Majority Facility Lenders in respect of such
Facility have determined in its or their sole discretion not to permit such conversions. Upon
receipt of any such notice the Administrative Agent shall promptly notify each relevant Lender
thereof.

     (a) Any Eurodollar Loan may be continued as such upon the expiration of the then current
Interest Period with respect thereto by the relevant Borrower giving irrevocable notice to the
Administrative Agent, in accordance with the applicable provisions of the term “Interest Period”
set forth in Section 1.1, of the length of the next Interest Period to be applicable to such Loans,
provided that no Eurodollar Loan under a particular Facility may be continued as such when
any Event of Default has occurred and is continuing and the Administrative Agent has or the
Majority Facility Lenders in respect of such Facility have determined in its or their sole
discretion not to permit such continuations, and provided, further, that if the
relevant Borrower shall fail to give any required notice as described above in this paragraph or if
such continuation is not permitted pursuant to the preceding proviso such Loans shall be
automatically converted to Base Rate Loans on the last day of such then expiring Interest Period.
Upon receipt of any such notice the Administrative Agent shall promptly notify each relevant Lender
thereof.

     4.4. Limitations on Eurodollar Tranches. Notwithstanding anything to the contrary in
this Agreement, all borrowings, conversions and continuations of Eurodollar Loans hereunder and all
selections of Interest Periods hereunder shall be in such amounts and be made pursuant to such
elections so that, (a) after giving effect thereto, the aggregate principal amount of the
Eurodollar Loans comprising each Eurodollar Tranche shall be equal to $1,000,000 or a whole
multiple of $100,000 in excess thereof and (b) no more than twelve Eurodollar Tranches shall be
outstanding at any one time.

     4.5. Interest Rates and Payment Dates. x) Each Eurodollar Loan shall bear interest
for each day during each Interest Period with respect thereto at a rate per annum equal to the
Eurodollar Rate determined for such day plus the Applicable Margin.

     (a) Each Base Rate Loan shall bear interest at a rate per annum equal to the Base Rate plus
the Applicable Margin.

     (b) (i) If all or a portion of the principal amount of any Loan or Reimbursement Obligation
shall not be paid when due (whether at the stated maturity, by acceleration or otherwise), such
overdue amount shall bear interest at a rate per annum equal to (x) in the case of the Loans, the
rate that would otherwise be applicable thereto pursuant to the foregoing provisions of this
Section plus 2% or (y) in the case of Reimbursement Obligations, the rate applicable to
Base Rate Loans under the Revolving Facility plus 2%, and (ii) if all or a portion of any
interest payable on any Loan or Reimbursement Obligation or any commitment fee or other amount
payable hereunder shall not be paid when due (whether at the stated maturity, by acceleration or
otherwise), such overdue amount shall bear interest at a rate per annum equal to the rate then
applicable to Base Rate Loans under the relevant Facility plus 2% (or, in the case of any
such other amounts that do not relate to a particular Facility, the rate then applicable to Base
Rate Loans under the Revolving Facility plus 2%), in each case, with respect to clauses (i)
and (ii) above, from the date of such non-payment until such amount is paid in full (as well after
as before judgment).

28

 

     (c) Interest shall be payable in arrears on each Interest Payment Date, provided that
interest accruing pursuant to paragraph (c) of this Section shall be payable from time to time on
demand.

     4.6. Computation of Interest and Fees. xi) Interest and fees payable pursuant hereto
shall be calculated on the basis of a 360-day year for the actual days elapsed, except that, with
respect to Base Rate Loans the rate of interest on which is calculated on the basis of the Prime
Rate, the interest thereon shall be calculated on the basis of a 365- (or 366-, as the case may be)
day year for the actual days elapsed. The Administrative Agent shall as soon as practicable notify
the relevant Borrower and the relevant Lenders of each determination of a Eurodollar Rate. Any
change in the interest rate on a Loan resulting from a change in the Base Rate or the Eurocurrency
Reserve Requirements shall become effective as of the opening of business on the day on which such
change becomes effective. The Administrative Agent shall as soon as practicable notify the
relevant Borrower and the relevant Lenders of the effective date and the amount of each such change
in interest rate.

     (a) Each determination of an interest rate by the Administrative Agent pursuant to any
provision of this Agreement shall be conclusive and binding on the Borrowers and the Lenders in the
absence of manifest error. The Administrative Agent shall, at the request of either Borrower,
deliver to such Borrower a statement showing the quotations used by the Administrative Agent in
determining any interest rate pursuant to Section 4.5(a).

     4.7. Inability to Determine Interest Rate. If prior to the first day of any Interest
Period:

     (a) the Administrative Agent shall have determined (which determination shall be
conclusive and binding upon the Borrowers) that, by reason of circumstances affecting
the relevant market, adequate and reasonable means do not exist for ascertaining the
Eurodollar Rate for such Interest Period, or

     (b) the Administrative Agent shall have received notice from the Majority Facility
Lenders in respect of the relevant Facility that the Eurodollar Rate determined or to be
determined for such Interest Period will not adequately and fairly reflect the cost to
such Lenders (as conclusively certified by such Lenders) of making or maintaining their
affected Loans during such Interest Period,

the Administrative Agent shall give telecopy or telephonic notice thereof to the Borrowers and the
relevant Lenders as soon as practicable thereafter. If such notice is given (x) any Eurodollar
Loans under the relevant Facility requested to be made on the first day of such Interest Period
shall be made as Base Rate Loans, (y) any Loans under the relevant Facility that were to have been
converted on the first day of such Interest Period to Eurodollar Loans shall be continued as Base
Rate Loans and (z) any outstanding Eurodollar Loans under the relevant Facility shall be converted,
on the last day of the then-current Interest Period, to Base Rate Loans. Until such notice has
been withdrawn by the Administrative Agent, no further Eurodollar Loans under the relevant Facility
shall be made or continued as such, nor shall either Borrower have the right to convert Loans under
the relevant Facility to Eurodollar Loans.

     4.8. Pro Rata Treatment and Payments. xii) Each borrowing by a Borrower from the
Lenders hereunder, each payment by a Borrower on account of any commitment fee and any reduction of
the Commitments of the Lenders shall be made pro rata according to the respective
First Lien Term Percentages or Revolving Percentages of the relevant Lenders.

     (a) Each payment (including each prepayment) by the US Borrower on account of principal of and
interest on the First Lien Term Loans shall be made pro rata according to the
respective

29

 

outstanding principal amounts of the First Lien Term Loans then held by the First Lien Term
Lenders. The amount of each principal payment or prepayment of the First Lien Term Loans shall be
applied, first, to the installments thereof due within the next 12 months in direct order
of maturity and, second, ratably to the remaining scheduled installments thereof. Amounts
repaid or prepaid on account of the First Lien Term Loans may not be reborrowed.

     (b) Each payment (including each prepayment) by a Borrower on account of principal of and
interest on the Revolving Loans shall be made pro rata according to the respective
outstanding principal amounts of the Revolving Loans then held by the Revolving Lenders.

     (c) All payments (including prepayments) to be made by the Borrowers hereunder, whether on
account of principal, interest, fees or otherwise, shall be made without setoff or counterclaim and
shall be made prior to 1:00 P.M., New York City time, on the due date thereof to the Administrative
Agent, for the account of the Lenders, at the Funding Office, in Dollars and in immediately
available funds. The Administrative Agent shall distribute such payments to the Lenders promptly
upon receipt in like funds as received. If any payment hereunder (other than payments on the
Eurodollar Loans) becomes due and payable on a day other than a Business Day, such payment shall be
extended to the next succeeding Business Day. If any payment on a Eurodollar Loan becomes due and
payable on a day other than a Business Day, the maturity thereof shall be extended to the next
succeeding Business Day unless the result of such extension would be to extend such payment into
another calendar month, in which event such payment shall be made on the immediately preceding
Business Day. In the case of any extension of any payment of principal pursuant to the preceding
two sentences, interest thereon shall be payable at the then applicable rate during such extension.

     (d) Unless the Administrative Agent shall have been notified in writing by any Lender prior to
a borrowing that such Lender will not make the amount that would constitute its share of such
borrowing available to the Administrative Agent, the Administrative Agent may assume that such
Lender is making such amount available to the Administrative Agent, and the Administrative Agent
may, in reliance upon such assumption, make available to the relevant Borrower a corresponding
amount. If such amount is not made available to the Administrative Agent by the required time on
the Borrowing Date therefor, such Lender shall pay to the Administrative Agent, on demand, such
amount with interest thereon at a rate equal to the greater of (i) the Federal Funds Effective Rate
and (ii) a rate determined by the Administrative Agent in accordance with banking industry rules on
interbank compensation for the period until such Lender makes such amount immediately available to
the Administrative Agent. A certificate of the Administrative Agent submitted to any Lender with
respect to any amounts owing under this paragraph shall be conclusive in the absence of manifest
error. If such Lender’s share of such borrowing is not made available to the Administrative Agent
by such Lender within three Business Days of such Borrowing Date, the Administrative Agent shall
also be entitled to recover such amount with interest thereon at the rate per annum applicable to
Base Rate Loans under the relevant Facility, on demand, from the relevant Borrower.

     (e) Unless the Administrative Agent shall have been notified in writing by a Borrower prior to
the date of any payment due to be made by such Borrower hereunder that such Borrower will not make
such payment to the Administrative Agent, the Administrative Agent may assume that such Borrower is
making such payment, and the Administrative Agent may, but shall not be required to, in reliance
upon such assumption, make available to the Lenders their respective pro rata
shares of a corresponding amount. If such payment is not made to the Administrative Agent by such
Borrower within three Business Days after such due date, the Administrative Agent shall be entitled
to recover, on demand, from each Lender to which any amount which was made available pursuant to
the preceding sentence, such amount with interest thereon at the rate per annum equal to the daily
average

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Federal Funds Effective Rate. Nothing herein shall be deemed to limit the rights of the
Administrative Agent or any Lender against either Borrower.

     4.9. Requirements of Law. xiii) If the adoption of or any change in any Requirement
of Law or in the interpretation or application thereof or compliance by any Lender with any request
or directive (whether or not having the force of law) from any central bank or other Governmental
Authority made subsequent to the date hereof:

     (i) shall subject any Lender to any tax of any kind whatsoever with
respect to this Agreement, any Letter of Credit, any Application or any Eurodollar
Loan made by it, or change the basis of taxation of payments to such Lender in
respect thereof (except for Non-Excluded Taxes covered by Section 4.10 and changes
in the rate of tax on the overall net income of such Lender);

     (ii) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by, deposits or
other liabilities in or for the account of, advances, loans or other extensions of
credit by, or any other acquisition of funds by, any office of such Lender that is
not otherwise included in the determination of the Eurodollar Rate hereunder; or

     (iii) shall impose on such Lender any other condition;

and the result of any of the foregoing is to increase the cost to such Lender, by an amount that
such Lender deems to be material, of making, converting into, continuing or maintaining Eurodollar
Loans or issuing, causing the issuance of or participating in Letters of Credit, or to reduce any
amount receivable hereunder in respect thereof, then, in any such case, the relevant Borrower
agrees to promptly pay such Lender, upon its demand, any additional amounts necessary to compensate
such Lender for such increased cost or reduced amount receivable. If any Lender becomes entitled
to claim any additional amounts pursuant to this paragraph, it shall promptly notify the relevant
Borrower (with a copy to the Administrative Agent) of the event by reason of which it has become so
entitled.

     (b) If any Lender shall have determined that the adoption of or any change in any Requirement
of Law regarding capital adequacy or in the interpretation or application thereof or compliance by
such Lender or any corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any Governmental Authority made
subsequent to the date hereof shall have the effect of reducing the rate of return on such Lender’s
or such corporation’s capital as a consequence of its obligations hereunder or under or in respect
of any Letter of Credit to a level below that which such Lender or such corporation could have
achieved but for such adoption, change or compliance (taking into consideration such Lender’s or
such corporation’s policies with respect to capital adequacy) by an amount deemed by such Lender to
be material, then from time to time, after submission by such Lender to the Borrowers (with a copy
to the Administrative Agent) of a written request therefor, the Borrowers jointly and severally
agree to pay to such Lender such additional amount or amounts as will compensate such Lender or
such corporation for such reduction.

     (c) A certificate as to any additional amounts payable pursuant to this Section submitted by
any Lender to the Borrowers (with a copy to the Administrative Agent) shall be conclusive in the
absence of manifest error. Notwithstanding anything to the contrary in this Section, neither
Borrower shall be required to compensate a Lender pursuant to this Section for any amounts incurred
more than six months prior to the date that such Lender notifies such Borrower of such Lender’s
intention to claim compensation therefor; provided that, if such circumstances giving rise
to such claim have a retroactive effect, then such six-month period shall be extended to include
the period of such retroactive

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effect. The obligations of the Borrowers pursuant to this Section shall survive the
termination of this Agreement and the payment of the Loans and all other amounts payable hereunder.

     4.10. Taxes. xiv) All payments made by the Borrowers under this Agreement shall be
made free and clear of, and without deduction or withholding for or on account of, any present or
future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or
withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental
Authority, excluding income taxes imposed on, or measured by net income, net profits or capital,
and franchise taxes however denominated, imposed in whole or in part on a basis in lieu of net
income imposed on any Agent or any Lender as a result of a present or former connection between
such Agent or such Lender and the jurisdiction of the Governmental Authority imposing such tax or
any political subdivision or taxing authority thereof or therein (other than any such connection
arising solely from such Agent or such Lender having executed, delivered or performed its
obligations or received a payment under, or enforced, this Agreement or any other First Lien Loan
Document). If any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions or
withholdings (“Non-Excluded Taxes”) or Other Taxes are required to be withheld from any
amounts payable to any Agent or any Lender hereunder, the amounts so payable to such Agent or such
Lender shall be increased to the extent necessary to yield to such Agent or such Lender (after
payment of all Non-Excluded Taxes and Other Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Agreement, provided,
however, that neither Borrower shall be required to increase any such amounts payable to
any Lender with respect to any Non-Excluded Taxes (i) that are attributable to such Lender’s
failure to comply with the requirements of paragraph (d) or (e) of this Section or (ii) other than
with respect to an assignee pursuant to a request by the Borrowers under Section 4.13, that are
United States withholding taxes imposed on amounts payable to such Lender at the time such Lender
becomes a party to this Agreement (or designates a new lending office), except to the extent that
such Lender, in the case of the designation of a new lending office, or Lender’s assignor (if any)
was entitled, at the time of assignment or designation (as applicable), to receive additional
amounts from a Borrower with respect to such Non-Excluded Taxes pursuant to this paragraph.

     (a) In addition, each Borrower shall pay any Other Taxes to the relevant Governmental
Authority in accordance with applicable law.

     (b) Whenever any Non-Excluded Taxes or Other Taxes are payable by either Borrower, as promptly
as possible thereafter such Borrower shall send to the Administrative Agent for its own account or
for the account of such Agent or Lender, as the case may be, a certified copy of an original
official receipt received by such Borrower showing payment thereof. If either Borrower fails to
pay any Non-Excluded Taxes or Other Taxes when due to the appropriate taxing authority or fails to
remit to the Administrative Agent the required receipts or other required documentary evidence, the
Borrowers jointly and severally agree to indemnify the Agents and the Lenders for any incremental
taxes, interest or penalties that may become payable by any Agent or any Lender as a result of any
such failure.

     (c) Each Lender (or Transferee) that is not a “U.S. Person” as defined in Section 7701(a)(30)
of the Code (a “Non-U.S. Lender”) shall deliver to the US Borrower and the Administrative
Agent (or, in the case of a Participant, to the Lender from which the related participation shall
have been purchased) two copies of either U.S. Internal Revenue Service Form W-8BEN or Form W-8ECI,
or, in the case of a Non-U.S. Lender claiming exemption from U.S. federal withholding tax under
Section 871(h) or 881(c) of the Code with respect to payments of “portfolio interest”, a statement
substantially in the form of Exhibit G and a Form W-8BEN, or any subsequent versions thereof or
successors thereto, properly completed and duly executed by such Non-U.S. Lender claiming complete
exemption from, or a reduced rate of, U.S. federal withholding tax on all payments by the US
Borrower under this Agreement and the other First Lien Loan Documents. Each Lender who is a “U.S.
Person” as defined in Section

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7701(a)(30) of the Code shall deliver to the Borrower and the Administrative Agent two copies
of a U.S. Internal Revenue Service Form W-9 properly completed and duly executed by such Lender
establishing an exemption from “backup withholding,” except that such form shall not be required to
the extent such Lender (such as a corporation) is otherwise exempt from backup withholding. Such
forms and statements shall be delivered by the applicable Person each Non-U.S. Lender on or before
the date it becomes a party to this Agreement (or, in the case of any Participant, on or before the
date such Participant purchases the related participation). In addition, such Person shall deliver
such forms and statements promptly upon the obsolescence or invalidity of any form or statement
previously delivered by such Person. Each Person providing forms or statements hereunder shall
promptly notify the US Borrower at any time it determines that it is no longer in a position to
provide any previously delivered certificate to the US Borrower (or any other form of certification
adopted by the U.S. taxing authorities for such purpose). Notwithstanding any other provision of
this paragraph, a Lender shall not be required to deliver any form pursuant to this paragraph that
such Lender is not legally able to deliver.

     (d) A Lender that is entitled to an exemption from or reduction of non-U.S. withholding tax
under the law of the jurisdiction in which the BVI Borrower is located, or any treaty to which such
jurisdiction is a party, with respect to payments under this Agreement shall deliver to the BVI
Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable
law or reasonably requested by the BVI Borrower, such properly completed and executed documentation
prescribed by applicable law as will permit such payments to be made without withholding or at a
reduced rate, provided that such Lender is legally entitled to complete, execute and
deliver such documentation and in such Lender’s judgment such completion, execution or submission
would not materially prejudice the legal position of such Lender.

     (e) The agreements in this Section shall survive the termination of this Agreement and the
payment of the Loans and all other amounts payable hereunder.

     4.11. Indemnity. Each Borrower agrees to indemnify each Lender and to hold each
Lender harmless from any loss or expense that such Lender may sustain or incur as a consequence of
(a) default by such Borrower in making a borrowing of, conversion into or continuation of
Eurodollar Loans after such Borrower has given a notice requesting the same in accordance with the
provisions of this Agreement, (b) default by such Borrower in making any prepayment of or
conversion from Eurodollar Loans after such Borrower has given a notice thereof in accordance with
the provisions of this Agreement or (c) the making of a prepayment of Eurodollar Loans on a day
that is not the last day of an Interest Period with respect thereto. Such indemnification may
include an amount equal to the excess, if any, of (i) the amount of interest that would have
accrued on the amount so prepaid, or not so borrowed, converted or continued, for the period from
the date of such prepayment or of such failure to borrow, convert or continue to the last day of
such Interest Period (or, in the case of a failure to borrow, convert or continue, the Interest
Period that would have commenced on the date of such failure) in each case at the applicable rate
of interest for such Loans provided for herein (excluding, however, the Applicable Margin included
therein, if any) over (ii) the amount of interest (as reasonably determined by such Lender) that
would have accrued to such Lender on such amount by placing such amount on deposit for a comparable
period with leading banks in the interbank eurodollar market. A certificate as to any amounts
payable pursuant to this Section submitted to the relevant Borrower by any Lender shall be
conclusive in the absence of manifest error. This covenant shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable hereunder.

     4.12. Change of Lending Office. Each Lender agrees that, upon the occurrence of any
event giving rise to the operation of Section 4.9 or 4.10(a) with respect to such Lender, it will,
if requested by the Borrowers, use reasonable efforts to designate another lending office for any
Loans affected by such event with the object of avoiding the consequences of such event;
provided, that such

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designation is made on terms that, in the sole judgment of such Lender, cause such Lender and
its lending office(s) to suffer no economic, legal or regulatory disadvantage, and
provided, further, that nothing in this Section shall affect or postpone any of the
obligations of either Borrower or the rights of any Lender pursuant to Section 4.9 or 4.10(a).

     4.13. Replacement of Lenders. The Borrowers shall be permitted to replace any Lender
that (a) requests reimbursement for amounts owing pursuant to Section 4.9 or 4.10(a) or (b)
defaults in its obligation to make Loans hereunder, with a replacement financial institution;
provided that (i) such replacement does not conflict with any Requirement of Law, (ii) no
Event of Default shall have occurred and be continuing at the time of such replacement, (iii) prior
to any such replacement, such Lender shall have taken no action under Section 4.12 so as to
eliminate the continued need for payment of amounts owing pursuant to Section 4.9 or 4.10(a), (iv)
the replacement financial institution shall purchase, at par, all Loans and other amounts owing to
such replaced Lender on or prior to the date of replacement, (v) the Borrowers shall be liable to
such replaced Lender under Section 4.11 if any Eurodollar Loan owing to such replaced Lender shall
be purchased other than on the last day of the Interest Period relating thereto, (vi) the
replacement financial institution, if not already a Lender, shall be reasonably satisfactory to the
Administrative Agent, (vii) the replaced Lender shall be obligated to make such replacement in
accordance with the provisions of Section 11.6 (provided that the Borrowers shall be
jointly and severally obligated to pay the registration and processing fee referred to therein),
(viii) until such time as such replacement shall be consummated, the Borrowers shall pay all
additional amounts (if any) required pursuant to Section 4.9 or 4.10(a), as the case may be, and
(ix) any such replacement shall not be deemed to be a waiver of any rights that either Borrower,
the Administrative Agent or any other Lender shall have against the replaced Lender.

     4.14. Evidence of Debt. xv) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing indebtedness of each Borrower to such Lender resulting
from each Loan of such Lender from time to time, including the amounts of principal and interest
payable and paid to such Lender from time to time under this Agreement.

     (a) The Administrative Agent, on behalf of the Borrowers, shall maintain the Register pursuant
to Section 11.6(b), and a subaccount therein for each Lender, in which shall be recorded (i) the
amount of each Loan made hereunder and any Note evidencing such Loan, the Type of such Loan and
each Interest Period applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from each Borrower to each Lender hereunder and (iii) both the
amount of any sum received by the Administrative Agent hereunder from each Borrower and each
Lender’s share thereof.

     (b) The entries made in the Register and the accounts of each Lender maintained pursuant to
Section 4.14(a) shall, to the extent permitted by applicable law, be prima facie
evidence of the existence and amounts of the obligations of each Borrower therein recorded;
provided, however, that the failure of any Lender or the Administrative Agent to
maintain the Register or any such account, or any error therein, shall not in any manner affect the
obligation of each Borrower to repay (with applicable interest) the Loans made to such Borrower by
such Lender in accordance with the terms of this Agreement.

     (c) The Borrowers agree that, upon the request to the Administrative Agent by any Lender, they
will execute and deliver to such Lender a promissory note evidencing any First Lien Term Loans or
Revolving Loans, as the case may be, of such Lender, in a form reasonably satisfactory to the
Administrative Agent and the Borrowers.

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     4.15. Illegality. Notwithstanding any other provision herein, if the adoption of or
any change in any Requirement of Law or in the interpretation or application thereof shall make it
unlawful for any Lender to make or maintain Eurodollar Loans as contemplated by this Agreement, (a)
the commitment of such Lender hereunder to make Eurodollar Loans, continue Eurodollar Loans as such
and convert Base Rate Loans to Eurodollar Loans shall forthwith be canceled and (b) such Lender’s
Loans then outstanding as Eurodollar Loans, if any, shall be converted automatically to Base Rate
Loans on the respective last days of the then current Interest Periods with respect to such Loans
or within such earlier period as required by law. If any such conversion of a Eurodollar Loan
occurs on a day which is not the last day of the then current Interest Period with respect thereto,
the Borrowers shall pay to such Lender such amounts, if any, as may be required pursuant to Section
4.11.

SECTION 5. REPRESENTATIONS AND WARRANTIES

     To induce the Agents and the Lenders to enter into this Agreement and to make the Loans and
issue or participate in the Letters of Credit, the Borrowers hereby jointly and severally represent
and warrant to each Agent and each Lender that:

     5.1. Financial Condition. xvi) The unaudited pro forma consolidated
balance sheet of Holdings and its consolidated Subsidiaries as of October 1, 2005 (including the
notes thereto) (the “Pro Forma Balance Sheet”) and the unaudited pro forma
consolidated statement of operations of Holdings and its consolidated Subsidiaries (i) as of
January 1, 2005, (ii) for the nine-month period ended October 1, 2005 and (iii) for the
twelve-month period ended October 1, 2005 (collectively, the “Pro Forma Operating
Statement”), copies of which have heretofore been furnished to each Lender, have been prepared
giving effect to (A) the consummation of the Transaction, (B) the Loans to be made on the Closing
Date and the use of proceeds thereof, (C) the Second Lien Debt to be incurred on the Closing Date
and the use of proceeds thereof and (D) the payment of fees and expenses in connection with the
foregoing as if such events, in the case of the Pro Forma Balance Sheet, had occurred on such date
or, in the case of the Pro Forma Operating Statement, had occurred on the first day of the fiscal
year ended January 1, 2005. The Pro Forma Balance Sheet and the Pro Forma Operating Statement have
been prepared based on the best information available to Holdings as of the date of delivery
thereof, and present fairly on a pro forma basis the estimated financial position of Holdings and
its consolidated Subsidiaries as at October 1, 2005 and the results of operations for such periods,
as applicable, assuming that the events specified in the preceding sentence had actually occurred
at such dates.

     (a) The audited consolidated balance sheets of Holdings and its consolidated Subsidiaries as
of December 27, 2003 and January 1, 2005 and the related consolidated statements of income and of
cash flows for the fiscal periods ended on such dates, reported on by and accompanied by an
unqualified report from KPMG LLP present fairly the consolidated financial condition of Holdings
and its consolidated Subsidiaries as at such dates, and the consolidated results of its operations
and its consolidated cash flows for the respective fiscal periods then ended. The unaudited
consolidated balance sheet of Holdings and its consolidated Subsidiaries as at April 2, 2005, July
2, 2005 and October 1, 2005 and the related unaudited consolidated statements of income and cash
flows for the quarterly periods ended on such dates, present fairly the consolidated financial
condition of Holdings and its consolidated Subsidiaries as at such dates, and the consolidated
results of its operations and its consolidated cash flows for the quarterly periods then ended
(subject to normal year-end audit adjustments). All such financial statements, including the
related schedules and notes thereto, have been prepared in accordance with GAAP applied
consistently throughout the periods involved (except as approved by the aforementioned firm of
accountants and disclosed therein). Neither Holdings nor any of its Subsidiaries has any material
Guarantee Obligations, contingent liabilities and liabilities for taxes, or any long-term leases or
unusual forward or long-term commitments, including any interest rate or foreign currency swap or
exchange transaction or other obligation in respect of derivatives, that are not reflected in the
most recent financial

35

 

statements referred to in this paragraph. During the period from January 1, 2005 and
including the date hereof there has been no Disposition by Holdings or any of its consolidated
Subsidiaries of any material part of their respective business or property.

     5.2. No Change. Since January 1, 2005, there has been no development or event that
has had or could reasonably be expected to have a Material Adverse Effect.

     5.3. Corporate Existence; Compliance with Law. Each Group Member (a) is duly
organized or incorporated, validly existing and in good standing under the laws of the jurisdiction
of its organization or incorporation, (b) has the power and authority, and the legal right, to own
and operate its property, to lease the property it operates as lessee and to conduct the business
in which it is currently engaged, (c) is duly qualified as a foreign corporation and in good
standing under the laws of each jurisdiction where its ownership, lease or operation of property or
the conduct of its business requires such qualification and (d) is in compliance with all
Requirements of Law except to the extent that the failure to comply therewith could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.

     5.4. Power; Authorization; Enforceable Obligations. Each Loan Party has the power and
authority, and the legal right, to make, deliver and perform the Loan Documents to which it is a
party and, in the case of either Borrower, to obtain extensions of credit hereunder. Each Loan
Party has taken all necessary organizational action to authorize the execution, delivery and
performance of the Loan Documents to which it is a party and, in the case of either Borrower, to
authorize the extensions of credit on the terms and conditions of this Agreement. No consent or
authorization of, filing with, notice to or other act by or in respect of, any Governmental
Authority or any other Person is required in connection with the Transaction and the extensions of
credit hereunder or with the execution, delivery, performance, validity or enforceability of this
Agreement or any of the First Lien Loan Documents, except (i) consents, authorizations, filings and
notices described in Schedule 5.4, which consents, authorizations, filings and notices have been
obtained or made and are in full force and effect and (ii) the filings referred to in Section 5.19.
Each First Lien Loan Document has been duly executed and delivered on behalf of each Loan Party
party thereto. This Agreement constitutes, and each other First Lien Loan Document upon execution
will constitute, a legal, valid and binding obligation of each Loan Party party thereto,
enforceable against each such Loan Party in accordance with its terms, except as enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors’ rights generally and by general equitable principles
(whether enforcement is sought by proceedings in equity or at law).

     5.5. No Legal Bar. The execution, delivery and performance of this Agreement and the
other First Lien Loan Documents, the issuance of Letters of Credit, the borrowings hereunder and
the use of the proceeds thereof will not violate any Requirement of Law or any Contractual
Obligation of any Group Member and will not result in, or require, the creation or imposition of
any Lien on any of their respective properties or revenues pursuant to any Requirement of Law or
any such Contractual Obligation (other than the Liens created by the First Lien Security
Documents). No Requirement of Law or Contractual Obligation applicable to any Group Member could
reasonably be expected to have a Material Adverse Effect.

     5.6. Litigation. Except as set forth on Schedule 5.6, no litigation, investigation or
proceeding of or before any arbitrator or Governmental Authority is pending or, to the knowledge of
either Borrower, threatened (or, in the case of any such litigation, investigation or proceeding of
or before any arbitrator or Governmental Authority after the Closing Date, threatened in writing)
by or against any Group Member or against any of their respective properties or revenues
(including, in the case of clause (b) below, any adverse developments after the date hereof in the
litigation described on Schedule 5.6) (a)

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with respect to any of the First Lien Loan Documents or any of the transactions contemplated
hereby or thereby, or (b) that could reasonably be expected to have a Material Adverse Effect.

     5.7. No Default. No Group Member is in default under or with respect to any of its
Contractual Obligations in any respect that could reasonably be expected to have a Material Adverse
Effect. No Default or Event of Default has occurred and is continuing.

     5.8. Ownership of Property; Liens. Each Group Member has title in fee simple to, or a
valid leasehold interest in, all its real property, and good title to, or a valid leasehold
interest in, all its other property, and none of such property is subject to any Lien except as
permitted by Section 8.3.

     5.9. Intellectual Property. Except to the extent the same could not reasonably be
expected to have a Material Adverse Effect: (a) each Group Member owns, or is licensed to use, all
Intellectual Property necessary for the conduct of its business as currently conducted; (b) no
material claim has been asserted and is pending by any Person challenging or questioning the use of
any Intellectual Property or the validity or effectiveness of any Intellectual Property, nor does
either Borrower know of any valid basis for any such claim; and (c) the use of Intellectual
Property by each Group Member does not infringe on the rights of any Person in any material
respect.

     5.10. Taxes. Except as, in the aggregate, could not be reasonably expected to have a
Material Adverse Effect: (a) each Group Member has filed or caused to be filed all Federal, state
and other material tax returns that are required to be filed and has paid all taxes shown to be due
and payable on said returns or on any assessments made against it or any of its property and all
other taxes, fees or other charges imposed on it or any of its property by any Governmental
Authority (other than any the amount or validity of that are currently being contested in good
faith by appropriate proceedings and with respect to which reserves in conformity with GAAP have
been provided on the books of the relevant Borrower or its Subsidiaries, as the case may be); and
(b) no tax Lien has been filed, other than Liens on property for current taxes, fees or other
charges not yet due and payable, and, to the knowledge of either Borrower, no claim is being
asserted, with respect to any such tax, fee or other charge other than claims being contested in
good faith by appropriate proceedings and with respect to which reserves in conformity with GAAP
have been provided on the books of the relevant Borrower or its Subsidiaries, as the case may be.

     5.11. Federal Regulations. No part of the proceeds of any Loans, and no other
extensions of credit hereunder, will be used for “buying” or “carrying” any “margin stock” within
the respective meanings of each of the quoted terms under Regulation U as now and from time to time
hereafter in effect or for any purpose that violates the provisions of the Regulations of the
Board. If requested by any Lender or the Administrative Agent, the Borrowers will furnish to the
Administrative Agent and each Lender a statement to the foregoing effect in conformity with the
requirements of FR Form G-3 or FR Form U-1, as applicable, referred to in Regulation U.

     5.12. Labor Matters. Except as, in the aggregate, could not reasonably be expected to
have a Material Adverse Effect: (a) there are no strikes or other labor disputes against any Group
Member pending or, to the knowledge of either Borrower, threatened; (b) hours worked by and payment
made to employees of each Group Member have not been in violation of the Fair Labor Standards Act
or any other applicable Requirement of Law dealing with such matters; and (c) all payments due from
any Group Member on account of employee health and welfare insurance have been paid or accrued as a
liability on the books of the relevant Group Member.

     5.13. ERISA. Neither a Reportable Event nor an “accumulated funding deficiency”
(within the meaning of Section 412 of the Code or Section 302 of ERISA) has occurred during the

37

 

five-year period prior to the date on which this representation is made or deemed made with
respect to any Plan, and each Plan has complied in all material respects with the applicable
provisions of ERISA and the Code. No termination of a Single Employer Plan has occurred, and no
Lien in favor of the PBGC or a Plan has arisen, during such five-year period. The present value of
all accrued benefits under each Single Employer Plan (based on those assumptions used to fund such
Plans) did not, as of the last annual valuation date prior to the date on which this representation
is made or deemed made, exceed the value of the assets of such Plan allocable to such accrued
benefits by a material amount. Neither Borrower nor any Commonly Controlled Entity has had a
complete or partial withdrawal from any Multiemployer Plan that has resulted or could reasonably be
expected to result in a material liability under ERISA, and neither Borrower nor any Commonly
Controlled Entity would become subject to any material liability under ERISA if either Borrower or
any such Commonly Controlled Entity were to withdraw completely from all Multiemployer Plans as of
the valuation date most closely preceding the date on which this representation is made or deemed
made. No such Multiemployer Plan is in Reorganization or Insolvent.

     5.14. Investment Company Act; Other Regulations. No Loan Party is an “investment
company”, or a company “controlled” by an “investment company”, within the meaning of the
Investment Company Act of 1940, as amended. No Loan Party is subject to regulation under any
Requirement of Law (other than Regulation X of the Board) that limits its ability to incur
Indebtedness.

     5.15. Subsidiaries. Except as disclosed to the Administrative Agent by the Borrowers
in writing from time to time after the Closing Date, (a) Schedule 5.15 sets forth the name and
jurisdiction of incorporation of each Subsidiary and, as to each such Subsidiary, the percentage of
each class of Capital Stock owned by any Loan Party and (b) there are no outstanding subscriptions,
options, warrants, calls, rights or other agreements or commitments (other than stock options
granted to employees or directors and directors’ qualifying shares) of any nature relating to any
Capital Stock of either Borrower or any Subsidiary, except as created by the First Lien Loan
Documents and the Second Lien Loan Documents.

     5.16. Use of Proceeds. The proceeds of the First Lien Term Loans shall be used to
finance a portion of the Transaction and to pay related fees and expenses. The proceeds of the
Revolving Loans shall be used for general corporate purposes.

     5.17. Environmental Matters. Except as, in the aggregate, could not reasonably be
expected to have a Material Adverse Effect:

     (a) the facilities and properties owned, leased or operated by any Group Member
(the “Properties”) do not contain, and have not previously contained, any
Materials of Environmental Concern in amounts or concentrations or under circumstances
that constitute or constituted a violation of, or could give rise to liability under,
any Environmental Law;

     (b) no Group Member has received or is aware of any notice of violation, alleged
violation, non-compliance, liability or potential liability regarding environmental
matters or compliance with Environmental Laws with regard to any of the Properties or
the business operated by any Group Member (the “Business”), nor does either
Borrower have knowledge or reason to believe that any such notice will be received or is
being threatened;

     (c) Materials of Environmental Concern have not been transported or disposed of
from the Properties in violation of, or in a manner or to a location that could give
rise to liability under, any Environmental Law, nor have any Materials of Environmental
Concern been generated, treated, stored or disposed of at, on or under any of the
Properties in

38

 

violation of, or in a manner that could give rise to liability under, any
applicable Environmental Law;

     (d) no judicial proceeding or governmental or administrative action is pending or,
to the knowledge of either Borrower, threatened, under any Environmental Law to which
any Group Member is or will be named as a party with respect to the Properties or the
Business, nor are there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or judicial requirements
outstanding under any Environmental Law with respect to the Properties or the Business;

     (e) there has been no release or threat of release of Materials of Environmental
Concern at or from the Properties, or arising from or related to the operations of any
Group Member in connection with the Properties or otherwise in connection with the
Business, in violation of or in amounts or in a manner that could give rise to liability
under Environmental Laws;

     (f) the Properties and all operations at the Properties are in compliance, and have
in the last five years been in compliance, with all applicable Environmental Laws, and
there is no contamination at, under or about the Properties or violation of any
Environmental Law with respect to the Properties or the Business; and

     (g) no Group Member has assumed any liability of any other Person under
Environmental Laws.

     5.18. Accuracy of Information, etc.. No statement or information contained in this
Agreement, any other First Lien Loan Document, the Confidential Information Memorandum or any other
document, certificate or statement furnished by or on behalf of any Loan Party to the
Administrative Agent or the Lenders, or any of them, for use in connection with the transactions
contemplated by this Agreement or the other First Lien Loan Documents, contained as of the date
such statement, information, document or certificate was so furnished (or, in the case of the
Confidential Information Memorandum, as of the date of this Agreement), any untrue statement of a
material fact or omitted to state a material fact necessary to make the statements contained herein
or therein not misleading. The projections and pro forma financial information
contained in the materials referenced above are based upon good faith estimates and assumptions
believed by management of the Borrowers to be reasonable at the time made, it being recognized by
the Lenders that such financial information as it relates to future events is not to be viewed as
fact and that actual results during the period or periods covered by such financial information may
differ from the projected results set forth therein by a material amount. There is no fact known
to any Loan Party that could reasonably be expected to have a Material Adverse Effect that has not
been expressly disclosed herein, in the other First Lien Loan Documents, in the Confidential
Information Memorandum or in any other documents, certificates and statements furnished to the
Administrative Agent and the Lenders for use in connection with the transactions contemplated
hereby and by the other First Lien Loan Documents.

     5.19. First Lien Security Documents. xvii) The First Lien Guarantee and Collateral
Agreement is effective to create in favor of the First Lien Collateral Agent, for the benefit of
the Lenders, a legal, valid and enforceable security interest in the Collateral described therein
and proceeds thereof. In the case of (i) the Pledged Stock described in the First Lien Guarantee
and Collateral Agreement, when stock certificates representing such Pledged Stock are delivered to
the First Lien Collateral Agent, (ii) the BVI Pledged Stock described in the First Lien Guarantee
and Collateral Agreement, when the share certificates evidencing such BVI Pledged Stock are
delivered to the First Lien Collateral Agent, a notation is made in the share register of the BVI
Borrower and a copy of the share register is filed at the British

39

 

Virgin Islands Registry of Corporate Affairs and (iii) the other Collateral described in the
First Lien Guarantee and Collateral Agreement, when financing statements, Register of Mortgages,
Charges and Other Encumbrances and other filings specified on Schedule 5.19(a) in appropriate form
are filed in the offices specified on Schedule 5.19(a), the First Lien Guarantee and Collateral
Agreement shall constitute a fully perfected Lien on, and security interest in, all right, title
and interest of the Loan Parties in such Collateral and the proceeds thereof, as security for the
Obligations (as defined in the First Lien Guarantee and Collateral Agreement), in each case prior
and superior in right to any other Person (except, in the case of Collateral other than Pledged
Stock, subject to certain Liens expressly permitted by Section 8.3).

     (a) Each Mortgage is effective to create in favor of the First Lien Collateral Agent, for the
benefit of the Lenders, a legal, valid and enforceable Lien on the Mortgaged Properties described
therein and proceeds thereof, and when the Mortgages are filed in the offices specified on Schedule
5.19(b), each such Mortgage shall constitute a fully perfected Lien on, and security interest in,
all right, title and interest of the Loan Parties in the Mortgaged Properties and the proceeds
thereof, as security for the Obligations (as defined in the relevant Mortgage), in each case prior
and superior in right to any other Person, subject to liens permitted under Section 8.3(e).
Schedule 1.1 lists, as of the Closing Date, each parcel of owned real property and each leasehold
interest in real property located in the United States and held by US Borrower or any of its
Subsidiaries that has a value, in the reasonable opinion of the US Borrower, in excess of $100,000.

     5.20. Solvency. Each Loan Party is, and after giving effect to the Transaction and
the incurrence of all Indebtedness and obligations being incurred in connection herewith and
therewith will be, and will continue to be, Solvent.

     5.21. Regulation H. No Mortgage encumbers improved real property that is located in
an area that has been identified by the Secretary of Housing and Urban Development as an area
having special flood hazards and in which flood insurance has been made available under the
National Flood Insurance Act of 1968.

SECTION 6. CONDITIONS PRECEDENT

     6.1. Conditions to Initial Extension of Credit. The agreement of each Lender to make
the initial extension of credit requested to be made by it is subject to the satisfaction, prior to
or concurrently with the making of such extension of credit on the Closing Date (but in any event
no later than December 14, 2005), of the following conditions precedent:

     (a) First Lien Credit Agreement; Other Agreements. The Administrative
Agent shall have received (i) this Agreement, or, in the case of the Lenders, an
Addendum, executed and delivered by each Agent, each Borrower and each Person that is a
Lender as of the Closing Date, (ii) the First Lien Guarantee and Collateral Agreement,
executed and delivered by the First Lien Collateral Agent, Holdings, the US Borrower,
the BVI Borrower and each Subsidiary Guarantor, (iii) an Acknowledgment and Consent in
the form attached to the First Lien Guarantee and Collateral Agreement, executed and
delivered by each Issuer (as defined therein), if any, that is not a Loan Party and (iv)
the Intercreditor Agreement, executed and delivered by the First Lien Collateral Agent,
the Second Lien Collateral Agent and each Loan Party.

40

 

     (b) Transaction, etc. The following transactions shall have been or shall
concurrently be consummated:

     (i) The Borrowers shall have paid a dividend in an amount not to
exceed $100,000,000 to Holdings and other holders of their Capital Stock;

     (ii) The Borrowers shall have received $50,000,000 in cash proceeds
from the incurrence of the Second Lien Debt;

     (iii) The Administrative Agent shall have received satisfactory
evidence that the fees and expenses to be incurred in connection with the
Transaction and the financing thereof shall not exceed $4,300,000; and

     (iv) The Administrative Agent shall have received evidence
satisfactory to it that the Existing Credit Agreement shall have been terminated and
all amounts thereunder shall have been paid in full and satisfactory arrangements
shall have been made for the termination of all Liens granted in connection
therewith.

     (c) Pro Forma Balance Sheet; Financial Statements. The Administrative
Agent shall have received the financial statements described in Section 5.1 and such
financial statements shall not, in the reasonable judgment of the Administrative Agent,
reflect any material adverse change in the consolidated financial condition of Holdings
and its Subsidiaries, as reflected in the financial statements or projections contained
in the Confidential Information Memorandum.

     (d) Financial Condition. The Administrative Agent shall have received
evidence satisfactory to it that the ratio of Funded Debt of Holdings and its
consolidated Subsidiaries to Consolidated EBITDA (each calculated on a pro forma basis
in a manner satisfactory to the Administrative Agent and consistent with the Pro Forma
Balance Sheet) for the nine-month period ended as of October 1, 2005 shall not exceed
4.75 to 1.0, and Holdings shall provide support for such calculation of a nature that is
satisfactory to the Administrative Agent.

     (e) Lien Searches. The Administrative Agent shall have received the
results of a recent lien search in each of the jurisdictions in the United States of
America where the Loan Parties are organized, and such search shall reveal no liens on
any of the assets of the Loan Parties except for liens permitted by Section 8.3 or
discharged on or prior to the Closing Date pursuant to documentation satisfactory to the
Administrative Agent.

     (f) Fees. The Lenders and the Agents shall have received all fees required
to be paid, and all expenses for which invoices have been presented (including the
reasonable fees and expenses of legal counsel), on or before the Closing Date. All such
amounts will be paid with proceeds of Loans made and Second Lien Debt incurred on the
Closing Date and will be reflected in the funding instructions given by the Borrowers to
the Administrative Agent on or before the Closing Date.

     (g) Closing Certificate. The Administrative Agent shall have received a
certificate of each Loan Party, dated the Closing Date, substantially in the form of
Exhibit C, with appropriate insertions and attachments including (i) the certificate of
incorporation of each Loan Party that is a corporation certified by the relevant
authority of the jurisdiction of

41

 

organization of such Loan Party, and (ii) a long form good standing certificate for
each Loan Party from its jurisdiction of organization.

     (h) Legal Opinions. The Administrative Agent shall have received the
following executed legal opinions:

     (i) the legal opinion of Greenberg Traurig, LLP, counsel to the
Borrowers and their Subsidiaries, substantially in the form of Exhibit F-1;

     (ii) the legal opinion of Morgan & Morgan, special counsel to the BVI
Borrower, substantially in the form of Exhibit F-2; and

     (iii) the legal opinion of Nixon Peabody LLP, substantially in the
form of Exhibit F-3.

Each such legal opinion shall cover such other matters incident to the transactions
contemplated by this Agreement as the Administrative Agent may reasonably require.

     (i) Pledged Stock; Stock Powers; Pledged Notes. The First Lien Collateral
Agent shall have received (i) the certificates representing the shares of Capital Stock
pledged pursuant to the First Lien Guarantee and Collateral Agreement, together with an
undated stock power or an instrument of transfer for each such certificate executed in
blank by a duly authorized officer of the pledgor thereof and (ii) each promissory note
(if any) pledged to the First Lien Collateral Agent pursuant to the First Lien Guarantee
and Collateral Agreement endorsed (without recourse) in blank (or accompanied by an
executed transfer form in blank) by the pledgor thereof.

     (j) Filings, Registrations and Recordings. 1. Each document (including any
Uniform Commercial Code financing statement) required by the First Lien Security Documents
or under law or reasonably requested by the First Lien Collateral Agent to be filed,
registered or recorded in order to create in favor of the First Lien Collateral Agent, for
the benefit of the Lenders, a perfected Lien on the Collateral described therein, prior and
superior in right to any other Person (subject to certain Liens expressly permitted by
Section 8.3), shall be in proper form for filing, registration or recordation.

     (i) The entry to be made in the Register of Mortgages, Charges and
Other Encumbrances of each of Holdings and the BVI Borrower shall be in a form
satisfactory to the Administrative Agent and shall be filed with the Registrar of
Companies in the British Virgin Islands no more than five Business Days after the
Closing Date.

     (ii) A notation to be made in the share register of the BVI Borrower
shall be in a form satisfactory the Administrative Agent and a copy of such share
register shall be filed with the Registrar of Companies in the British Virgin
Islands no more than five Business Days after the Closing Date.

     (k) Mortgages, etc. 2. The Administrative Agent shall have received a
Mortgage with respect to each Mortgaged Property, executed and delivered by a duly
authorized officer of each party thereto.

     (i) If requested by the Administrative Agent, the Administrative
Agent shall have received, and the title insurance company issuing the policy
referred to in clause

42

 

(iii) below (the “Title Insurance Company”) shall have received, maps
or plats of an as-built survey of the sites of the Mortgaged Properties certified to
the Administrative Agent and the Title Insurance Company in a manner satisfactory to
them, dated a date satisfactory to the Administrative Agent and the Title Insurance
Company by an independent professional licensed land surveyor satisfactory to the
Administrative Agent and the Title Insurance Company, which maps or plats and the
surveys on which they are based shall be made in accordance with the Minimum
Standard Detail Requirements for Land Title Surveys jointly established and adopted
by the American Land Title Association and the American Congress on Surveying and
Mapping in 1992, and, without limiting the generality of the foregoing, there shall
be surveyed and shown on such maps, plats or surveys the following: (A) the
locations on such sites of all the buildings, structures and other improvements and
the established building setback lines; (B) the lines of streets abutting the sites
and width thereof; (C) all access and other easements appurtenant to the sites; (D)
all roadways, paths, driveways, easements, encroachments and overhanging projections
and similar encumbrances affecting the site, whether recorded, apparent from a
physical inspection of the sites or otherwise known to the surveyor; (E) any
encroachments on any adjoining property by the building structures and improvements
on the sites; (F) if the site is described as being on a filed map, a legend
relating the survey to said map; and (G) the flood zone designations, if any, in
which the Mortgaged Properties are located.

     (ii) The Administrative Agent shall have received in respect of each
Mortgaged Property a mortgagee’s title insurance policy (or policies) or marked up
unconditional binder for such insurance. Each such policy shall (A) be in an amount
satisfactory to the Administrative Agent; (B) be issued at ordinary rates; (C)
insure that the Mortgage insured thereby creates a valid first Lien on such
Mortgaged Property free and clear of all defects and encumbrances, except as
disclosed therein; (D) name the Administrative Agent for the benefit of the Lenders
as the insured thereunder; (E) be in the form of ALTA Loan Policy — 1970 (Amended
10/17/70 and 10/17/84) (or equivalent policies); (F) contain such endorsements and
affirmative coverage as the Administrative Agent may reasonably request and (G) be
issued by title companies satisfactory to the Administrative Agent (including any
such title companies acting as co-insurers or reinsurers, at the option of the
Administrative Agent). The Administrative Agent shall have received evidence
satisfactory to it that all premiums in respect of each such policy, all charges for
mortgage recording tax, and all related expenses, if any, have been paid.

     (iii) If requested by the Administrative Agent, the Administrative
Agent shall have received (A) a policy of flood insurance that (1) covers any parcel
of improved real property that is encumbered by any Mortgage, (2) is written in an
amount not less than the outstanding principal amount of the indebtedness secured by
such Mortgage that is reasonably allocable to such real property or the maximum
limit of coverage made available with respect to the particular type of property
under the National Flood Insurance Act of 1968, whichever is less, and (3) has a
term ending not later than the maturity of the Indebtedness secured by such Mortgage
and (B) confirmation that US Borrower has received the notice required pursuant to
Section 208(e)(3) of Regulation H of the Board.

     (iv) The Administrative Agent shall have received a copy of all
recorded documents referred to, or listed as exceptions to title in, the title
policy or policies referred to in clause (iii) above and a copy of all other
material documents affecting the Mortgaged Properties.

43

 

     (l) Solvency Certificate. The Administrative Agent shall have received a
solvency certificate of the chief financial officer of Holdings which shall document the
solvency of Holdings and its Subsidiaries after giving effect to the Transaction, the
making of Loans hereunder and the incurrence of the Second Lien Debt.

     (m) Insurance. The Administrative Agent shall have received insurance
certificates satisfying the requirements of Section 5.3(b) of the First Lien Guarantee
and Collateral Agreement.

     (n) Agent for Service of Process. The Administrative Agent shall have
received a letter from CT Corporation System accepting its appointment as agent for
service of process for the BVI Borrower as required by Section 11.12.

     (o) Control Agreements. The Administrative Agent shall have received
control agreements in form and substance satisfactory to the Administrative Agent from
institutions sufficient to comply with the requirements set forth in Section 7.12 as of
the Closing Date.

     (p) Ratings. The Facilities shall have received a rating from each of S&P and
Moody’s.

     (q) Projections. The Administrative Agent shall have received projections
through 2012.

     (r) Milberg Intercreditor Agreement. The First Lien Collateral Agent and
Milberg shall have entered into an intercreditor agreement on substantially the same
terms as the intercreditor agreement entered into by Milberg and Bank of America N.A.,
in connection with the Milberg Factoring Agreement.

     (s) USA PATRIOT Act. Each Lender shall have received, prior to the Closing
Date, all documentation and other information required by regulatory authorities under
applicable “know your customer” and anti-money laundering rules and regulations,
including, without limitation, the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed
into law October 26, 2001)) and requested by the Lenders.

     6.2. Conditions to Each Extension of Credit. The agreement of each Lender to make any
extension of credit requested to be made by it on any date (including its initial extension of
credit) is subject to the satisfaction of the following conditions precedent:

     (a) Representations and Warranties. Each of the representations and
warranties made by any Loan Party in or pursuant to the First Lien Loan Documents shall
be true and correct on and as of such date as if made on and as of such date, subject to
the Borrowers updating the Schedules thereto from time to time to reflect events that
would not constitute or result in a Default or an Event of Default hereunder;
provided that for purposes of the extension of credit to be made on the Closing
Date, Section 5.2 shall be deemed to read as follows: “During the period from January 1,
2005 through and including December 9, 2005, there has been no development or event that
has had or could reasonably be expected to have a Material Adverse Effect.”

     (b) No Default. No Default or Event of Default shall have occurred and be
continuing on such date or after giving effect to the extensions of credit requested to
be made on such date.

44

 

Each borrowing by and issuance of a Letter of Credit on behalf of a Borrower hereunder shall
constitute a representation and warranty by the Borrowers as of the date of such extension of
credit that the conditions contained in this Section 6.2 have been satisfied.

SECTION 7. AFFIRMATIVE COVENANTS

     Each Borrower jointly and severally hereby agrees that, so long as the Commitments remain in
effect, any Letter of Credit remains outstanding or any Loan or other amount is owing to any Lender
or Agent hereunder, such Borrower shall and shall cause each of its Subsidiaries to (with the
exception of the restrictions set forth in Section 7.12 which shall only apply to the Borrowers and
the Domestic Subsidiaries):

     7.1. Financial Statements. Furnish to the Administrative Agent and each Lender:

     (a) as soon as available, but in any event within 90 days after the end of each
fiscal year of Holdings, a copy of the audited consolidated balance sheet of Holdings
and its consolidated Subsidiaries as at the end of such year and the related audited
consolidated statements of income and of cash flows for such year, setting forth in each
case in comparative form the figures for the previous year, reported on without a “going
concern” or like qualification or exception, or qualification arising out of the scope
of the audit, by KPMG LLP or other independent certified public accountants of
nationally recognized standing;

     (b) as soon as available, but in any event not later than 45 days after the end of
each of the first three quarterly periods of each fiscal year of Holdings, the unaudited
consolidated balance sheet of Holdings and its consolidated Subsidiaries as at the end
of such quarter and the related unaudited consolidated statements of income and of cash
flows for such quarter and the portion of the fiscal year through the end of such
quarter, setting forth in each case in comparative form the figures for the previous
year, certified by a Responsible Officer of Holdings as being fairly stated in all
material respects (subject to normal year-end audit adjustments); and

     (c) as soon as available, but in any event not later than 45 days after the end of
each month occurring during each fiscal year of Holdings (other than the third, sixth,
ninth and twelfth such month), the unaudited consolidated balance sheets of Holdings and
its Subsidiaries as at the end of such month and the related unaudited consolidated
statements of income and of cash flows for such month and the portion of the fiscal year
through the end of such month, setting forth in each case in comparative form the
figures for the previous year, certified by a Responsible Officer of Holdings as being
fairly stated in all material respects (subject to normal year-end audit adjustments).

All such financial statements shall be complete and correct in all material respects and shall be
prepared in reasonable detail and in accordance with GAAP applied consistently throughout the
periods reflected therein and with prior periods (except as approved by such accountants or
officer, as the case may be, and disclosed therein).

     7.2. Certificates; Other Information. Furnish to the Administrative Agent and each
Lender (or, in the case of clause (f), to the relevant Lender):

     (a) concurrently with the delivery of the financial statements referred to in Section
7.1(a), a certificate of the independent certified public accountants reporting on such
financial

45

 

statements stating that in making the examination necessary therefor no knowledge was
obtained of any Default or Event of Default with respect to any financial covenant, except
as specified in such certificate;

     (b) concurrently with the delivery of any financial statements pursuant to Section
7.1, (i) a certificate of a Responsible Officer of the Borrowers stating that, to the
best of each such Responsible Officer’s knowledge, each Loan Party during such period
has observed or performed all of its covenants and other agreements, and satisfied every
condition contained in this Agreement and the other First Lien Loan Documents to which
it is a party to be observed, performed or satisfied by it, and that such Responsible
Officer has obtained no knowledge of any Default or Event of Default except as specified
in such certificate and (ii) in the case of quarterly or annual financial statements,
(x) a Compliance Certificate containing all information and calculations necessary for
determining compliance by each Group Member with the provisions of this Agreement
referred to therein as of the last day of the fiscal quarter or fiscal year of Holdings,
as the case may be, and (y) to the extent not previously disclosed to the Administrative
Agent, a listing of any Intellectual Property acquired by any Loan Party since the date
of the most recent list delivered pursuant to this clause (y) (or, in the case of the
first such list so delivered, since the Closing Date);

     (c) as soon as available, and in any event no later than 45 days after the end of
each fiscal year of Holdings, a detailed consolidated budget for the following fiscal
year (including a projected consolidated balance sheet of Holdings and its Subsidiaries
as of the end of the following fiscal year, the related consolidated statements of
projected cash flow, projected changes in financial position and projected income and a
description of the underlying assumptions applicable thereto), and, as soon as
available, significant revisions, if any, of such budget and projections with respect to
such fiscal year (collectively, the “Projections”), which Projections shall in
each case be accompanied by a certificate of a Responsible Officer of Holdings stating
that such Projections are based on reasonable estimates, information and assumptions and
that such Responsible Officer has no reason to believe that such Projections are
incorrect or misleading in any material respect;

     (d) if Holdings is not then a reporting company under the Securities Exchange Act
of 1934, as amended, within 45 days after the end of each fiscal quarter of Holdings (or
90 days, in the case of the last fiscal quarter of any fiscal year), a narrative
discussion and analysis of the financial condition and results of operations of Holdings
and its Subsidiaries for such fiscal quarter and for the period from the beginning of
the then current fiscal year to the end of such fiscal quarter, as compared to the
portion of the Projections covering such periods and to the comparable periods of the
previous year;

     (e) within five days after the same are sent, copies of all financial statements
and reports that Holdings sends to the holders of any class of its debt securities or
public equity securities (in their capacity as such) and, within five days after the
same are filed, copies of all financial statements and reports that Holdings may make
to, or file with, the SEC; and

     (f) promptly, such additional financial and other information as any Lender may
from time to time reasonably request.

     7.3. Payment of Obligations. Pay, discharge or otherwise satisfy at or before
maturity or before they become delinquent, as the case may be, all its material obligations of
whatever nature, except where the amount or validity thereof is currently being contested in good
faith by appropriate

46

 

proceedings and reserves in conformity with GAAP with respect thereto have been provided on
the books of the relevant Group Member.

     7.4. Maintenance of Existence; Compliance. xviii)(i) Preserve, renew and keep in
full force and effect its organizational existence and (ii) take all reasonable action to maintain
all rights, privileges and franchises necessary or desirable in the normal conduct of its business,
except, in each case, as otherwise permitted by Section 8.4 and except, in the case of clause (ii)
above, to the extent that failure to do so could not reasonably be expected to have a Material
Adverse Effect; and (b) comply with all Contractual Obligations and Requirements of Law except to
the extent that failure to comply therewith could not, in the aggregate, reasonably be expected to
have a Material Adverse Effect.

     7.5. Maintenance of Property; Insurance. xix) Maintain all property useful and
necessary in its business in good working order and condition, ordinary wear and tear excepted,
except to the extent the failure to so maintain such assets could not reasonably be expected to
have a Material Adverse Effect, and (b) maintain with financially sound and reputable insurance
companies insurance on all its property in at least such amounts and against at least such risks
(but including in any event public liability, product liability and business interruption) as are
usually insured against in the same general area by companies engaged in the same or a similar
business.

     7.6. Inspection of Property; Books and Records; Discussions. xx) Keep proper books
of records and account in which full, true and correct entries in conformity with GAAP and all
Requirements of Law shall be made of all dealings and transactions in relation to its business and
activities and (b) permit representatives of any Lender to visit and inspect any of its properties
and examine and make abstracts from any of its books and records at any reasonable time and as
often as may reasonably be desired and to discuss the business, operations, properties and
financial and other condition of the Group Members with officers and employees of the Group Members
and with their independent certified public accountants upon reasonable advance notice to Borrowers
(which advance notice, in the case of discussions with the Borrowers’ independent accountants,
shall afford the Borrowers the opportunity to be present during such discussions).

     7.7. Notices. Promptly give notice to the Administrative Agent and each Lender of:

     (a) the occurrence of any Default or Event of Default;

     (b) any (i) default or event of default under any Contractual Obligation of any
Group Member or (ii) litigation, investigation or proceeding that may exist at any time
between any Group Member and any Governmental Authority, that, in either case, if not
cured or if adversely determined, as the case may be, could reasonably be expected to
have a Material Adverse Effect;

     (c) any litigation or proceeding affecting any Group Member (i) in which the amount
involved is $500,000 or more and not covered by insurance, (ii) in which injunctive or
similar relief is sought or (iii) which relates to any First Lien Loan Document;

     (d) the following events, as soon as possible and in any event within 30 days after
either Borrower knows or has reason to know thereof: (i) the occurrence of any
Reportable Event with respect to any Plan, a failure to make any required contribution
to a Plan, the creation of any Lien in favor of the PBGC or a Plan or any withdrawal
from, or the termination, Reorganization or Insolvency of, any Multiemployer Plan or
(ii) the institution of proceedings or the taking of any other action by the PBGC or
either Borrower or any

47

 

Commonly Controlled Entity or any Multiemployer Plan with respect to the withdrawal
from, or the termination, Reorganization or Insolvency of, any Plan; and

     (e) any development or event that has had or could reasonably be expected to have a
Material Adverse Effect.

Each notice pursuant to this Section 7.7 shall be accompanied by a statement of a Responsible
Officer of the Borrowers setting forth details of the occurrence referred to therein and stating
what action the relevant Borrower or the relevant Subsidiary proposes to take with respect thereto.

     7.8. Environmental Laws. xxi) Comply in all material respects with, and ensure
compliance in all material respects by all tenants and subtenants, if any, with, all applicable
Environmental Laws, and obtain and comply in all material respects with and maintain, and ensure
that all tenants and subtenants obtain and comply in all material respects with and maintain, any
and all licenses, approvals, notifications, registrations or permits required by applicable
Environmental Laws, except, in each case, to the failure to do so could not reasonably be expected
to have a Material Adverse Effect.

     (a) Conduct and complete all investigations, studies, sampling and testing, and all remedial,
removal and other actions required under Environmental Laws and promptly comply in all material
respects with all lawful orders and directives of all Governmental Authorities regarding
Environmental Laws, except to the extent the failure to do so could not reasonably be expected to
have a Material Adverse Effect.

     7.9. Interest Rate Protection. Enter into, and thereafter maintain, Hedge Agreements
to the extent necessary to provide that (a) within 90 days after the Closing Date, at least 30% of
the aggregate principal amount of the First Lien Term Loans made and the Second Lien Debt incurred
on the Closing Date and (b) within 90 days following the first anniversary of the Closing Date, at
least 50% of the aggregate principal amount of the First Lien Term Loans and the Second Lien Debt
outstanding on such date is subject to either a fixed interest rate or interest rate protection for
a period of not less than three years, which Hedge Agreements shall have terms and conditions
reasonably satisfactory to the Administrative Agent.

     7.10. Additional Collateral, etc. xxii) With respect to any property acquired after
the Closing Date by any Group Member (other than (x) any property described in paragraph (b), (c)
or (d) below, (y) any property subject to a Lien expressly permitted by Section 8.3(g) and (z)
property acquired by any Excluded Foreign Subsidiary) as to which the First Lien Collateral Agent,
for the benefit of the Lenders, does not have a perfected Lien, promptly (i) execute and deliver to
the First Lien Collateral Agent such amendments to the First Lien Guarantee and Collateral
Agreement or such other documents as the First Lien Collateral Agent deems necessary or advisable
to grant to the First Lien Collateral Agent, for the benefit of the Lenders, a security interest in
such property and (ii) take all actions necessary or advisable to grant to the First Lien
Collateral Agent, for the benefit of the Lenders, a perfected first priority security interest in
such property, including the filing of Uniform Commercial Code financing statements in such
jurisdictions as may be required by the First Lien Guarantee and Collateral Agreement or by law or
as may be requested by the First Lien Collateral Agent.

     (a) With respect to any fee interest in any real property located in the United States having
a value (together with improvements thereof) of at least $500,000 acquired after the Closing Date
by any Group Member (other than (x) any such real property subject to a Lien expressly permitted by
Section 8.3(g) and (y) real property acquired by any Excluded Foreign Subsidiary), promptly (i)
execute and deliver a first priority Mortgage, in favor of the First Lien Collateral Agent, for the
benefit of the Lenders, covering such real property, (ii) if requested by the First Lien Collateral
Agent, provide the First

48

 

Lien Collateral Agent and the Lenders with (x) title and extended coverage insurance covering
such real property in an amount at least equal to the purchase price of such real property (or such
other amount as shall be reasonably specified by the First Lien Collateral Agent) as well as a
current ALTA survey thereof, together with a surveyor’s certificate and (y) any consents or
estoppels reasonably deemed necessary or advisable by the First Lien Collateral Agent in connection
with such Mortgage, each of the foregoing in form and substance reasonably satisfactory to the
First Lien Collateral Agent and (iii) if requested by the First Lien Collateral Agent, deliver to
the First Lien Collateral Agent legal opinions relating to the matters described above, which
opinions shall be in form and substance, and from counsel, reasonably satisfactory to the First
Lien Collateral Agent.

     (b) With respect to any new Subsidiary (other than an Excluded Foreign Subsidiary) created or
acquired after the Closing Date by any Group Member (which, for the purposes of this paragraph (c),
shall include any existing Subsidiary that ceases to be an Excluded Foreign Subsidiary), promptly
(i) execute and deliver to the First Lien Collateral Agent such amendments to the First Lien
Guarantee and Collateral Agreement as the First Lien Collateral Agent deems necessary or advisable
to grant to the First Lien Collateral Agent, for the benefit of the Lenders, a perfected first
priority security interest in the Capital Stock of such new Subsidiary that is owned by any Group
Member, (ii) deliver to the First Lien Collateral Agent the certificates representing such Capital
Stock, together with undated stock powers, in blank, executed and delivered by a duly authorized
officer of the relevant Group Member, (iii) cause such new Subsidiary (A) to become a party to the
First Lien Guarantee and Collateral Agreement, (B) to take such actions necessary or advisable to
grant to the First Lien Collateral Agent, for the benefit of the Lenders, a perfected first
priority security interest in the Collateral described in the First Lien Guarantee and Collateral
Agreement with respect to such new Subsidiary, including the filing of Uniform Commercial Code
financing statements in such jurisdictions as may be required by the First Lien Guarantee and
Collateral Agreement or by law or as may be requested by the First Lien Collateral Agent and (C) to
deliver to the First Lien Collateral Agent a certificate of such Subsidiary, substantially in the
form of Exhibit C, with appropriate insertions and attachments, and (iv) if requested by the First
Lien Collateral Agent, deliver to the First Lien Collateral Agent legal opinions relating to the
matters described above, which opinions shall be in form and substance, and from counsel,
reasonably satisfactory to the First Lien Collateral Agent.

     (c) With respect to any new Excluded Foreign Subsidiary created or acquired after the Closing
Date by any Group Member (other than by any Group Member that is an Excluded Foreign Subsidiary),
promptly (i) execute and deliver to the First Lien Collateral Agent such amendments to the First
Lien Guarantee and Collateral Agreement as the First Lien Collateral Agent deems necessary or
advisable to grant to the First Lien Collateral Agent, for the benefit of the Lenders, a perfected
first priority security interest in the Capital Stock of such new Subsidiary that is owned by any
such Group Member (provided that in no event shall more than 65% of the total outstanding
Capital Stock of any such new Subsidiary be required to be so pledged), (ii) deliver to the First
Lien Collateral Agent the certificates representing such Capital Stock, together with undated stock
powers, in blank, executed and delivered by a duly authorized officer of the relevant Group Member,
as the case may be, and take such other action as may be necessary or, in the opinion of the First
Lien Collateral Agent, desirable to perfect the First Lien Collateral Agent’s security interest
therein, and (iii) if requested by the First Lien Collateral Agent, deliver to the First Lien
Collateral Agent legal opinions relating to the matters described above, which opinions shall be in
form and substance, and from counsel, reasonably satisfactory to the First Lien Collateral Agent.

     7.11. Further Assurances. From time to time execute and deliver, or cause to be
executed and delivered, such additional instruments, certificates or documents, and take all such
actions (including but not limited to the filing of any Register of Mortgages, Charges and Other
Encumbrances with the Registrar of Companies of the British Virgin Islands), as the Administrative
Agent or the

49

 

Syndication Agent may reasonably request for the purposes of implementing or effectuating the
provisions of this Agreement and the other First Lien Loan Documents, or of more fully perfecting
or renewing the rights of the First Lien Collateral Agent, for the benefit of the Lenders, with
respect to the Collateral (or with respect to any additions thereto or replacements or proceeds
thereof or with respect to any other property or assets hereafter acquired by either Borrower or
any Subsidiary which may be deemed to be part of the Collateral) pursuant hereto or thereto. Upon
the exercise by the Administrative Agent, the Syndication Agent or any Lender of any power, right,
privilege or remedy pursuant to this Agreement or the other First Lien Loan Documents which
requires any consent, approval, recording qualification or authorization of any Governmental
Authority, each Borrower will execute and deliver, or will cause the execution and delivery of, all
applications, certifications, instruments and other documents and papers that the Administrative
Agent, the Syndication Agent or such Lenders may be required to obtain from such Borrower or any of
its Subsidiaries for such governmental consent, approval, recording, qualification or
authorization.

     7.12. Maintenance of Cash and Cash Equivalents in the United States. Maintain cash
and Cash Equivalents in accounts in the United States with any Lender or any commercial bank
organized under the laws of the United States or any state thereof having combined capital and
surplus of not less than $500,000,000, subject to a control agreement in favor of the
Administrative Agent in form and substance reasonably satisfactory to the Administrative Agent
(each, a “Control Agreement”). The Borrowers may change the banks at which such accounts
are maintained so long as the requirements of the previous sentence are satisfied.

     7.13. Maintenance of Ratings. Use commercially reasonably efforts to maintain ratings
issued by Moody’s and S&P with respect to the Facilities at all times, unless otherwise agreed by
the Administrative Agent.

SECTION 8. NEGATIVE COVENANTS

     Each Borrower jointly and severally hereby agrees that, so long as the Commitments remain in
effect, any Letter of Credit remains outstanding or any Loan or other amount is owing to any Lender
or Agent hereunder, neither Borrower shall, nor shall it permit any of its Subsidiaries to,
directly or indirectly (with the exception of the restrictions set forth in Section 8.17 which
shall only apply to the BVI Borrower):

     8.1. Financial Condition Covenants. xxiii) Consolidated Leverage Ratio.
Permit the Consolidated Leverage Ratio as at the last day of any period of four consecutive fiscal
quarters of Holdings ending with any fiscal quarter set forth below to exceed the ratio set forth
below opposite such fiscal quarter:

	 	 	 
	Fiscal Quarter

	 	Consolidated

Leverage Ratio
	 
	 	 
	 	 	 
	December 31, 2005
	 	5.25 to 1.00
	March 31, 2006
	 	5.25 to 1.00
	June 30, 2006
	 	5.25 to 1.00
	September 30, 2006
	 	5.25 to 1.00
	December 31, 2006
	 	4.75 to 1.00
	March 31, 2007
	 	4.00 to 1.00
	June 30, 2007
	 	4.00 to 1.00
	September 30, 2007
	 	4.00 to 1.00

50

 

	 	 	 
	Fiscal Quarter
	 	Consolidated

Leverage Ratio
	 
	 	 
	 	 	 
	December 31, 2007
	 	4.00 to 1.00
	March 31, 2008
	 	3.50 to 1.00
	June 30, 2008
	 	3.50 to 1.00
	September 30, 2008
	 	3.50 to 1.00
	December 31, 2008
	 	3.50 to 1.00
	March 31, 2009
	 	2.75 to 1.00
	June 30, 2009
	 	2.75 to 1.00
	September 30, 2009
	 	2.75 to 1.00
	December 31, 2009
	 	2.75 to 1.00
	March 31, 2010
	 	2.50 to 1.00
	June 30, 2010
	 	2.50 to 1.00
	September 30, 2010
	 	2.50 to 1.00
	December 31, 2010
	 	2.50 to 1.00
	March 31, 2011 and thereafter
	 	2.00 to 1.00

     (a) Consolidated First Lien Leverage Ratio. Permit the Consolidated First Lien
Leverage Ratio as at the last day of any period of four consecutive fiscal quarters of Holdings
ending with any fiscal quarter set forth below to exceed the ratio set forth below opposite such
fiscal quarter:

	 	 	 
	Fiscal Quarter
	 	Consolidated

First Lien Leverage Ratio
	 
	 	 
	 	 	 
	December 31, 2005
	 	4.00 to 1.00
	March 31, 2006
	 	4.00 to 1.00
	June 30, 2006
	 	4.00 to 1.00
	September 30, 2006
	 	4.00 to 1.00
	December 31, 2006
	 	3.75 to 1.00
	March 31, 2007
	 	3.00 to 1.00
	June 30, 2007
	 	3.00 to 1.00
	September 30, 2007
	 	3.00 to 1.00
	December 31, 2007
	 	3.00 to 1.00
	March 31, 2008
	 	2.50 to 1.00
	June 30, 2008
	 	2.50 to 1.00
	September 30, 2008
	 	2.50 to 1.00
	December 31, 2008
	 	2.50 to 1.00
	March 31, 2009
	 	2.00 to 1.00
	June 30, 2009
	 	2.00 to 1.00
	September 30, 2009
	 	2.00 to 1.00
	December 31, 2009
	 	2.00 to 1.00
	March 31, 2010
	 	1.75 to 1.00
	June 30, 2010
	 	1.75 to 1.00
	September 30, 2010
	 	1.75 to 1.00
	December 31, 2010
	 	1.75 to 1.00
	March 31, 2011 and thereafter
	 	1.25 to 1.00

     (b) Consolidated Interest Coverage Ratio. Permit the Consolidated Interest Coverage
Ratio for any period of four consecutive fiscal quarters of Holdings (or, if less, the number of

51

 

full fiscal quarters subsequent to the Closing Date) ending with any fiscal quarter set forth
below to be less than the ratio set forth below opposite such fiscal quarter:

	 	 	 
	Fiscal Quarter
	 	Consolidated Interest

Coverage Ratio
	 
	 	 
	 	 	 
	December 31, 2005
	 	1.90 to 1.00
	March 31, 2006
	 	1.90 to 1.00
	June 30, 2006
	 	1.90 to 1.00
	September 30, 2006
	 	1.90 to 1.00
	December 31, 2006
	 	1.90 to 1.00
	March 31, 2007
	 	1.90 to 1.00
	June 30, 2007
	 	1.90 to 1.00
	September 30, 2007
	 	1.90 to 1.00
	December 31, 2007
	 	1.90 to 1.00
	March 31, 2008
	 	2.10 to 1.00
	June 30, 2008
	 	2.10 to 1.00
	September 30, 2008
	 	2.10 to 1.00
	December 31, 2008
	 	2.10 to 1.00
	March 31, 2009
	 	2.50 to 1.00
	June 30, 2009
	 	2.50 to 1.00
	September 30, 2009
	 	2.50 to 1.00
	December 31, 2009
	 	2.50 to 1.00
	March 31, 2010
	 	2.75 to 1.00
	June 30, 2010
	 	2.75 to 1.00
	September 30, 2010
	 	2.75 to 1.00
	December 31, 2010
	 	2.75 to 1.00
	March 31, 2011
	 	3.25 to 1.00
	June 30, 2011
	 	3.25 to 1.00
	September 30, 2011
	 	3.25 to 1.00
	December 31, 2011
	 	3.25 to 1.00
	March 31, 2012
	 	4.00 to 1.00
	June 30, 2012
	 	4.00 to 1.00
	September 30, 2012
	 	4.00 to 1.00
	December 31, 2012
	 	4.00 to 1.00

provided, that for the purposes of determining the ratio described above for the fiscal
quarters of Holdings ending March 31, 2006, June 30, 2006 and September 30, 2006, Consolidated
Interest Expense for the relevant period shall be deemed to equal Consolidated Interest Expense for
such fiscal quarter (and, in the case of the latter two such determinations, each previous fiscal
quarter commencing after the Closing Date) multiplied by 4, 2 and 4/3, respectively.

     8.2. Indebtedness. Create, issue, incur, assume, become liable in respect of or
suffer to exist any Indebtedness, except:

     (a) Indebtedness of any Loan Party pursuant to any First Lien Loan Document;

     (b) Indebtedness:

     (i) of the US Borrower to the BVI Borrower or to any Subsidiary
Guarantor;

52

 

     (ii) of the BVI Borrower to any Foreign Subsidiary that is not a
Subsidiary of the US Borrower;

     (iii) of any Subsidiary Guarantor which is a Domestic Subsidiary to
either Borrower or any other Subsidiary Guarantor;

     (iv) of any Foreign Subsidiary to any other Foreign Subsidiary (other
than the BVI Borrower); and

     (v) subject to Sections 8.8(f) and (g), of any Foreign Subsidiary to
either Borrower or any Subsidiary Guarantor;

     (c) Guarantee Obligations incurred in the ordinary course of business by:

     (i) the BVI Borrower or any Subsidiary Guarantor of obligations of
the US Borrower;

     (ii) any Foreign Subsidiary that is not a Subsidiary of the US
Borrower of obligations of the BVI Borrower;

     (iii) either Borrower or any Subsidiary Guarantor of obligations of
any other Subsidiary Guarantor which is a Domestic Subsidiary;

     (iv) any Foreign Subsidiary (other that the BVI Borrower) of
obligations of any other Foreign Subsidiary (including the BVI Borrower);

     (v) subject to Section 8.8(f) and (g), either Borrower or any
Subsidiary Guarantor of obligations of any Foreign Subsidiary (other than the BVI
Borrower); and

     (vi) the US Borrower or any other Subsidiary of obligations of the
BVI Borrower to purchase inventory, raw materials and assets in the conduct of the
BVI Borrower Business or to pay operating lease expenses in the ordinary course of
business;

     (d) Indebtedness outstanding on the date hereof and listed on Schedule 8.2(d) and
any refinancings, refundings, renewals or extensions thereof (without increasing, or
shortening the maturity of, the principal amount thereof);

     (e) Indebtedness (including, without limitation, Capital Lease Obligations) of
either Borrower and their Subsidiaries secured by Liens permitted by Section 8.3(g) in
an aggregate principal amount not to exceed $1,500,000 at any one time outstanding;

     (f) Hedge Agreements permitted under Section 8.11;

     (g) subject to the Intercreditor Agreement, (i) Second Lien Debt in an aggregate
principal amount not to exceed $50,000,000 plus the amount of any fees, premiums and
expenses in connection with a permitted refinancing thereof and accrued interest thereon
and (ii) guaranties thereof by Holdings or any Subsidiary that is a Subsidiary Guarantor
thereof;

     (h) additional Indebtedness of either Borrower and any of their Subsidiaries in an
aggregate principal amount not to exceed $2,500,000 at any one time outstanding (but not
to

53

 

exceed $500,000 with respect to the BVI Borrower and its Subsidiaries that are not
Subsidiaries of the US Borrower); and

     (i) in the event that the Borrowers may not request Letters of Credit under this
Agreement as contemplated by Section 10.12, Indebtedness in respect of letters of credit
not to exceed the amount of the L/C Commitment less any outstanding L/C Obligations,
which letters of credit shall be secured as provided in Section 8.3(l) in an amount at
least equal to the face amount of such letters of credit.

     8.3. Liens. Create, incur, assume or suffer to exist any Lien upon any of its
property, whether now owned or hereafter acquired, except for:

     (a) Liens for taxes not yet due or that are being contested in good faith by
appropriate proceedings, provided that adequate reserves with respect thereto
are maintained on the books of the relevant Borrower or their respective Subsidiaries,
as the case may be, in conformity with GAAP;

     (b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like
Liens arising in the ordinary course of business that are not overdue for a period of
more than 30 days or that are being contested in good faith by appropriate proceedings;

     (c) pledges or deposits in connection with workers’ compensation, unemployment
insurance and other social security legislation;

     (d) deposits to secure the performance of bids, trade contracts (other than for
borrowed money), leases, statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature incurred in the ordinary course of
business;

     (e) easements, rights-of-way, restrictions and other similar encumbrances incurred
in the ordinary course of business that, in the aggregate, are not substantial in amount
and that do 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 either
Borrower or any of its Subsidiaries;

     (f) Liens in existence on the date hereof listed on Schedule 8.3(f), securing
Indebtedness permitted by Section 8.2(d), provided that no such Lien is spread
to cover any additional property after the Closing Date and that the amount of
Indebtedness secured thereby is not increased;

     (g) Liens securing Indebtedness of either Borrower or any of their Subsidiaries
incurred pursuant to Section 8.2(e) to finance the acquisition of fixed or capital
assets, provided that (i) such Liens shall be created substantially
simultaneously with the acquisition of such fixed or capital assets, (ii) such Liens do
not at any time encumber any property other than the property financed by such
Indebtedness and (iii) the amount of Indebtedness secured thereby is not increased;

     (h) Liens (i) created pursuant to the First Lien Security Documents or (ii) subject
to the Intercreditor Agreement, Liens securing the Second Lien Debt;

54

 

     (i) any interest or title of a lessor under any lease entered into by either
Borrower or any other Subsidiary in the ordinary course of its business and covering
only the assets so leased;

     (j) Liens on accounts receivable assigned to Milberg pursuant to the Milberg
Factoring Agreements, at any time outstanding up to an aggregate principal amount of
$100,000,000, and the proceeds thereof;

     (k) Liens not otherwise permitted by this Section securing Indebtedness or other
obligations of either Borrower and their Subsidiaries so long as neither (i) the
aggregate outstanding principal amount of the obligations secured thereby nor (ii) the
aggregate fair market value (determined as of the date such Lien is incurred) of the
assets subject thereto exceeds (as to each Borrower and all Subsidiaries) $500,000 at
any one time; and

     (l) Liens on cash and Cash Equivalents to secure Indebtedness permitted under
Section 8.2(i)) granted in favor of the issuer or issuers of the related letters of
credit, provided that the aggregate amount of cash and Cash Equivalents subject
to such Liens may not exceed the lesser of (A) the L/C Commitment and (B) the aggregate
amount of such outstanding Indebtedness.

     8.4. Fundamental Changes. Enter into any merger, consolidation or amalgamation, or
liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution), or Dispose of,
all or substantially all of its property or business, except that:

     (a) any Subsidiary of the US Borrower may be merged or consolidated with or into
the US Borrower (provided that the US Borrower shall be the continuing or
surviving corporation) or with or into any Subsidiary Guarantor (provided that
the Subsidiary Guarantor shall be the continuing or surviving corporation) or, subject
to Section 8.8(f) and 8.8(g), with or into any Foreign Subsidiary;

     (b) any (i) Subsidiary of the US Borrower may Dispose of any or all of its assets
(upon voluntary liquidation or otherwise) to the US Borrower or any Subsidiary Guarantor
or, subject to Sections 8.8(f) and 8.8(g), to any Foreign Subsidiary, (ii) Subsidiary of
the BVI Borrower may Dispose of any or all of its assets (upon voluntary liquidation or
otherwise) to any other Subsidiary of the BVI Borrower and (iii) any Foreign Subsidiary
(other than the BVI Borrower) may Dispose of any or all of its assets (upon voluntary
liquidation or otherwise) to any other Foreign Subsidiary;

     (c) the US Borrower or the BVI Borrower may dispose of any or all of its assets to
any Subsidiary of the US Borrower which is a Subsidiary Guarantor (or, in the case of
the BVI Borrower, to the US Borrower);

     (d) any Subsidiary of the BVI Borrower that is not a Subsidiary of the US Borrower
may be merged into the BVI Borrower or may dispose of any or all of its assets to the
BVI Borrower;

     (e) the US Borrower and its Subsidiaries may return inventory purchased from the
BVI Borrower to the BVI Borrower in exchange for a credit or refund of the purchase
price and may assign and transfer accounts receivable to the BVI Borrower for a credit
or for cash in connection with the compromise or collection thereof; and

55

 

     (f) any Subsidiary of the BVI Borrower (other than the US Borrower) may dissolve
concurrently with or subsequent to the Disposition of all its assets pursuant to this
Section 8.4(a), (b), (c) or (d).

     8.5. Disposition of Property. Dispose of any of its property, whether now owned or
hereafter acquired, or, in the case of any Subsidiary, issue or sell any shares of such
Subsidiary’s Capital Stock to any Person, except:

     (a) the Disposition of obsolete or worn out property in the ordinary course of
business;

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

     (c) Dispositions permitted by Section 8.4(b), (c), (d) and (e);

     (d) the sale or issuance of any Subsidiary’s Capital Stock to the US Borrower or
any Subsidiary Guarantor;

     (e) the Disposition by the US Borrower or any of its Subsidiaries of other property
(other than Dispositions of less than all the Capital Stock of any Subsidiary owned by
the Group Members) having a fair market value not to exceed $1,000,000 in the aggregate
for any fiscal year of such Borrower; and

     (f) the assignment of the Assigned Accounts under and as defined in the Milberg
Factoring Agreements to Milberg pursuant to the terms thereof.

     8.6. Restricted Payments. Declare or pay any dividend (other than dividends payable
solely in common stock or shares of the Person making such dividend) on, or make any payment on
account of, or set apart assets for a sinking or other analogous fund for, the purchase,
redemption, defeasance, retirement or other acquisition of, any Capital Stock of any Group Member,
whether now or hereafter outstanding, or make any other distribution in respect thereof, either
directly or indirectly, whether in cash or property or in obligations of either Borrower or any
Subsidiary (collectively, “Restricted Payments”), except that:

     (a) any Subsidiary may make Restricted Payments to the US Borrower or any
Subsidiary Guarantor;

     (b) so long as no Default or Event of Default shall have occurred and be continuing
or would result therefrom, the US Borrower and the BVI Borrower may pay dividends to
Holdings to enable Holdings to purchase the common stock or common stock options from
present or former officers or employees of any Group Member upon the death, disability
or termination of employment of such officer or employee, provided, that the
aggregate amount of payments under this clause (i) after the date hereof (net of any
proceeds received and contributed to Holdings after the date hereof in connection with
resales of any common stock or common stock options so purchased) shall not exceed
$500,000; and

     (c) any Subsidiary of the BVI Borrower that is not a Subsidiary of the US Borrower
may make Restricted Payments to the BVI Borrower.

     8.7. Capital Expenditures. Make or commit to make any Capital Expenditure, except (a)
Capital Expenditures of the US Borrower and its Subsidiaries in the ordinary course of business not

56

 

exceeding during any of the fiscal years of the US Borrower set forth below, the amount set
forth opposite such fiscal year below:

	 	 	 
	Fiscal Year

	 	Amount
	 

	 	 
	2005 through 2009

2010 through 2012

	 	$15,000,000

$20,000,000

provided, that (i) up to $5,000,000 of any such amount referred to above, if not so
expended in the fiscal year for which it is permitted, may be carried over for expenditure in the
next succeeding fiscal year and (ii) Capital Expenditures made pursuant to this clause (a) during
any fiscal year shall be deemed made, first, in respect of amounts permitted for such fiscal year
as provided above and, second, in respect of amounts carried over from the prior fiscal year
pursuant to subclause (i) above; (b) Capital Expenditures made with the proceeds of any
Reinvestment Deferred Amount; and (c) Capital Expenditures of the BVI Borrower and its Subsidiaries
that are not Subsidiaries of the US Borrower in the ordinary course of business not to exceed
$500,000 during any fiscal year.

     8.8. Investments. Make any advance, loan, extension of credit (by way of guaranty or
otherwise) or capital contribution to, or purchase any Capital Stock, bonds, notes, debentures or
other debt securities of, or any assets constituting a business unit of, or make any other
investment in, any Person (all of the foregoing, “Investments”), except:

     (a) extensions of trade credit in the ordinary course of business;

     (b) Investments in Cash Equivalents;

     (c) Guarantee Obligations permitted by Section 8.2;

     (d) loans and advances to employees of any Group Member of the US Borrower in the
ordinary course of business (including for travel, entertainment and relocation
expenses) in an aggregate amount for all Group Members not to exceed $1,000,000 at any
one time outstanding;

     (e) intercompany Investments by (i) Holdings in the BVI Borrower, and by any Group
Member in the US Borrower or any Person that, prior to such Investment, is a Subsidiary
Guarantor which is a Domestic Subsidiary and (ii) any Foreign Subsidiary (other than the
BVI Borrower) in any Person that, prior to such Investment, is a Foreign Subsidiary;

     (f) intercompany Investments by the US Borrower or any of its Subsidiaries in the
Mexican Joint Venture or in any Person, that, prior to such Investment, is a Foreign
Subsidiary (including, without limitation, Guarantee Obligations with respect to
obligations of the Mexican Joint Venture or any such Foreign Subsidiary, loans made to
the Mexican Joint Venture or any such Foreign Subsidiary and Investments resulting from
mergers with or sales of assets to the Mexican Joint Venture or any such Foreign
Subsidiary) in an aggregate amount (valued at cost) not to exceed $6,000,000 during the
term of this Agreement, provided that Investments in the Mexican Joint Venture
do not exceed $1,000,000 during the term of this Agreement;

     (g) in addition to Investments otherwise expressly permitted by this Section,
Investments by the US Borrower or any of its Subsidiaries in an aggregate amount (valued
at cost) not to exceed $2,000,000 during the term of this Agreement;

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     (h) in addition to Investments otherwise expressly permitted by this Section,
Investments by the BVI Borrower in any Person that is or becomes a Foreign Subsidiary at
the time of such Investment, in an aggregate amount (valued at cost) not to exceed
$500,000 during the term of this Agreement;

     (i) the Term Promissory Note dated April 30, 2003 in the original principal amount
of $1,408,313 from the Mexican Joint Venture in favor of FosterGrant; and

     (j) Loan Agreement between FosterGrant, as lender, and AAi.Foster Grant Limited, a
company incorporated under the laws of England and Wales, evidencing loans not to exceed
1,400,000 Pounds Sterling.

     8.9. Transactions with Affiliates. Enter into any transaction, including any
purchase, sale, lease or exchange of property, the rendering of any service or the payment of any
management, advisory or similar fees, with any Affiliate (other than the Borrowers or any
Subsidiary Guarantor) unless such transaction is (a) otherwise permitted under this Agreement, (b)
in the ordinary course of business of the relevant Group Member and (c) upon fair and reasonable
terms no less favorable to the relevant Group Member, than it would obtain in a comparable arm’s
length transaction with a Person that is not an Affiliate.

     8.10. Sales and Leasebacks. Enter into any arrangement with any Person providing for
the leasing by any Group Member of real or personal property that has been or is to be sold or
transferred by such Group Member to such Person or to any other Person to whom funds have been or
are to be advanced by such Person on the security of such property or rental obligations of such
Group Member.

     8.11. Hedge Agreements. Enter into any Hedge Agreement with any Agent or Lender or
any affiliate thereof, as counterparty, except (a) Hedge Agreements entered into to hedge or
mitigate risks to which either Borrower or any Subsidiary has actual exposure (other than those in
respect of Capital Stock) and (b) Hedge Agreements entered into in order to effectively cap, collar
or exchange interest rates (from fixed to floating rates, from one floating rate to another
floating rate or otherwise) with respect to any interest-bearing liability or investment of either
Borrower or any Subsidiary.

     8.12. Changes in Fiscal Periods. Permit the fiscal year of Holdings or either
Borrower to end on a day other than the Saturday closest to December 31 or change Holdings or
either Borrower’s method of determining fiscal quarters.

     8.13. Negative Pledge Clauses. Enter into or suffer to exist or become effective any
agreement that prohibits or limits the ability of any Group Member to create, incur, assume or
suffer to exist any Lien upon any of its property or revenues, whether now owned or hereafter
acquired, other than (a) this Agreement and the other First Lien Loan Documents, (b) the Second
Lien Loan Documents and (c) any agreements governing any purchase money Liens or Capital Lease
Obligations otherwise permitted hereby (in which case, any prohibition or limitation shall only be
effective against the assets financed thereby).

     8.14. Clauses Restricting Subsidiary Distributions. Enter into or suffer to exist or
become effective any consensual encumbrance or restriction on the ability of any Subsidiary of the
BVI Borrower to (a) make Restricted Payments in respect of any Capital Stock of such Subsidiary
held by, or pay any Indebtedness owed to, the BVI Borrower or any other Subsidiary of the BVI
Borrower, (b) make loans or advances to, or other Investments in, the BVI Borrower or any other
Subsidiary of the BVI Borrower or (c) transfer any of its assets to the BVI Borrower or any other
Subsidiary of the BVI Borrower, except for such encumbrances or restrictions existing under or by
reason of (i) any restrictions

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existing under the First Lien Loan Documents or the Second Lien Loan Documents, (ii) any
restrictions with respect to a Subsidiary imposed pursuant to an agreement that has been entered
into in connection with the Disposition of all or substantially all of the Capital Stock or assets
of such Subsidiary, and (iii) any agreements governing any purchase money Liens or Capital Lease
Obligations permitted by Section 8.3(g) (in which case, any prohibition or limitation shall only be
effective against the assets financed thereby).

     8.15. Optional Payments and Modifications of Second Lien Debt. Without the written
consent of the Required Lenders, (a) make or offer to make any optional or voluntary payment,
prepayment, repurchase or redemption of or otherwise optionally or voluntarily defease or segregate
funds with respect to the Second Lien Debt, provided that any such payment, prepayment,
repurchase or redemption made with the Net Cash Proceeds of an IPO shall be permitted so long as,
after giving pro forma effect thereto, the Consolidated Leverage Ratio as of the
last day of the most recent fiscal quarter of the US Borrower for which financial statements have
been delivered pursuant to Section 7.1 (as demonstrated by delivery to the Administrative Agent of
a certificate to such effect showing such calculations in reasonable detail) shall be less than 3.5
to 1.0; (b) subject to the Intercreditor Agreement, amend, modify, waive or otherwise change, or
consent or agree to any amendment, modification, waiver or other change to, any of the terms of the
Second Lien Debt (other than any such amendment, modification, waiver or other change that would
extend the maturity or reduce the amount of any payment of principal thereof or reduce the rate or
extend any date for payment of interest thereon).

     8.16. Lines of Business. Enter into any business, either directly or through any
Subsidiary, except for those businesses in which Holdings and its Subsidiaries are engaged on the
date of this Agreement or that are reasonably related thereto.

     8.17. Limitation on Activities of the BVI Borrower. (i) Conduct, transact, purchase,
invest or otherwise engage in, or commit to conduct, transact, purchase, invest or otherwise engage
in, any business or operations, except the BVI Borrower Business, (ii) incur, create, assume or
suffer to exist any Indebtedness or other liabilities or financial obligations, except pursuant to
the First Lien Loan Documents to which it is a party or in the conduct of the BVI Borrower Business
subject to the limitations of this Agreement, or (iii) own, lease, manage or otherwise operate any
properties or assets, other than in each case, the ownership of shares of Capital Stock of the US
Borrower or of any of its Subsidiaries (subject to the limitations set forth in this Agreement)
necessary, incidental or ancillary to the conduct of the BVI Borrower Business.

     8.18. Factoring Agreements. Enter into, either directly or through any Subsidiary, or
suffer to exist, any factoring agreement or other similar agreement for the sale of accounts
receivable to any Person (other than (a) any such agreements in effect on the date hereof
(including the Milberg Factoring Agreements) and (b) sales of accounts receivable for collection in
the ordinary course of business).

SECTION 9. EVENTS OF DEFAULT

     If any of the following events shall occur and be continuing:

     (a) either Borrower shall fail to pay any principal of any Loan or Reimbursement
Obligation when due in accordance with the terms hereof; or either Borrower shall fail
to pay any interest on any Loan or Reimbursement Obligation, or any other amount payable
hereunder or under any other First Lien Loan Document, within five days after any such
interest or other amount becomes due in accordance with the terms hereof; or

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     (b) any representation or warranty made or deemed made by any Loan Party herein or
in any other First Lien Loan Document or that is contained in any certificate, document
or financial or other statement furnished by it at any time under or in connection with
this Agreement or any such other First Lien Loan Document shall prove to have been
inaccurate in any material respect on or as of the date made or deemed made; or

     (c) any Loan Party shall default in the observance or performance of any agreement
contained in clause (i) of Section 7.4(a) (with respect to the Borrowers only), Section
7.7(a) or Section 8 of this Agreement or Sections 5.6 and 5.8(b) of the First Lien
Guarantee and Collateral Agreement; or

     (d) any Loan Party shall default in the observance or performance of any other
agreement contained in this Agreement or any other First Lien Loan Document (other than
as provided in paragraphs (a) through (c) of this Section), and such default shall
continue unremedied for a period of 30 days after notice to the Borrowers from the
Administrative Agent or any Lender; or

     (e) any Group Member (i) defaults in making any payment of any principal of any
Indebtedness (including any Guarantee Obligation, but excluding the Loans and the Second
Lien Debt) on the scheduled or original due date with respect thereto; or (ii) defaults
in making any payment of any interest on any such Indebtedness beyond the period of
grace, if any, provided in the instrument or agreement under which such Indebtedness was
created; or (iii) defaults in the observance or performance of any other agreement or
condition relating to any such Indebtedness or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event shall occur or condition
exist, the effect of which default or other event or condition is to cause. or permit
the holder or beneficiary of such Indebtedness (or a trustee or agent on behalf of such
holder or beneficiary) to cause, with the giving of notice if required, such
Indebtedness to become due prior to its stated maturity or to become subject to a
mandatory offer to purchase by the obligor thereunder or (in the case of any such
Indebtedness constituting a Guarantee Obligation) to become payable; provided,
that a default, event or condition described in clause (i), (ii) or (iii) of this
paragraph (e) shall not at any time constitute an Event of Default unless, at such time,
one or more defaults, events or conditions of the type described in clauses (i), (ii)
and (iii) of this paragraph (e) shall have occurred and be continuing with respect to
Indebtedness the outstanding principal amount of which exceeds in the aggregate
$5,000,000; or

     (f) any Group Member shall (i) default in making any payment of any principal on
the Second Lien Debt on the due date (giving effect to any extension or period of grace)
with respect thereto; or (ii) default in making any payment of any interest on the
Second Lien Debt beyond any deferral period and the period of grace, if any, provided
therein or in the Second Lien Credit Agreement (including any continued deferral or
payment in kind of interest thereunder that does not constitute an “Event of Default” as
provided therein); or (iii) default in the observance or performance of any other
agreement or condition relating to the Second Lien Debt or contained in the Second Lien
Credit Agreement, or any other event shall occur or condition exist, and as a
consequence of such default or other event or condition the maturity of the Second Lien
Debt shall have been accelerated or the Second Lien Debt shall have become due prior to
its stated maturity; or

     (g) (i) any Group Member shall commence any case, proceeding or other action (A)
under any existing or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an order
for relief

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entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation, dissolution,
composition or other relief with respect to it or its debts, or (B) seeking appointment
of a receiver, trustee, custodian, conservator or other similar official for it or for
all or any substantial part of its assets, or any Group Member shall make a general
assignment for the benefit of its creditors; or (ii) there shall be commenced against
any Group Member any case, proceeding or other action of a nature referred to in clause
(i) above that (A) results in the entry of an order for relief or any such adjudication
or appointment or (B) remains undismissed, undischarged or unbonded for a period of 60
days; or (iii) there shall be commenced against any Group Member any case, proceeding or
other action seeking issuance of a warrant of attachment, execution, distraint or
similar process against all or any substantial part of its assets that results in the
entry of an order for any such relief that shall not have been vacated, discharged, or
stayed or bonded pending appeal within 60 days from the entry thereof; or (iv)any Group
Member shall take any action in furtherance of, or indicating its consent to, approval
of, or acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above;
or (v) any Group Member shall generally not, or shall be unable to, or shall admit in
writing its inability to, pay its debts as they become due; or

     (h) (i) any Person shall engage in any “prohibited transaction” (as defined in
Section 406 of ERISA or Section 4975 of the Code) involving any Plan, (ii) any
“accumulated funding deficiency” (as defined in Section 302 of ERISA), whether or not
waived, shall exist with respect to any Plan or any Lien in favor of the PBGC or a Plan
shall arise on the assets of any Group Member or any Commonly Controlled Entity, (iii) a
Reportable Event shall occur with respect to, or proceedings shall commence to have a
trustee appointed, or a trustee shall be appointed, to administer or to terminate, any
Single Employer Plan, which Reportable Event or commencement of proceedings or
appointment of a trustee is, in the reasonable opinion of the Required Lenders, likely
to result in the termination of such Plan for purposes of Title IV of ERISA, (iv) any
Single Employer Plan shall terminate for purposes of Title IV of ERISA, (v) any Group
Member or any Commonly Controlled Entity shall, or in the reasonable opinion of the
Required Lenders is likely to, incur any liability in connection with a withdrawal from,
or the Insolvency or Reorganization of, a Multiemployer Plan or (vi) any other event or
condition shall occur or exist with respect to a Plan; and in each case in clauses (i)
through (vi) above, such event or condition, together with all other such events or
conditions, if any, could, in the sole judgment of the Required Lenders, reasonably be
expected to have a Material Adverse Effect; or

     (i) one or more judgments or decrees shall be entered against any Group Member
involving in the aggregate a liability (not paid or fully covered by insurance as to
which the relevant insurance company has acknowledged coverage) of $5,000,000 or more,
and all such judgments or decrees shall not have been vacated, discharged, stayed or
bonded pending appeal within 30 days from the entry thereof; or

     (j) any of the First Lien Security Documents shall cease, for any reason, to be in
full force and effect, or any Loan Party or any Affiliate of any Loan Party shall so
assert, or any Lien created by any of the First Lien Security Documents shall cease to
be enforceable and of the same effect and priority purported to be created thereby, or
any Loan Party or any Affiliate of any Loan Party shall so assert the invalidity or lack
of perfection or priority of any such Lien; or

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     (k) the guarantee contained in Section 2 of the First Lien Guarantee and Collateral
Agreement shall cease, for any reason, to be in full force and effect or any Loan Party
or any Affiliate of any Loan Party shall so assert; or

     (l) (i) prior to consummation of an IPO, (A) Holdings shall cease to own of record
and beneficially 100% of the Capital Stock of the BVI Borrower, (B) the BVI Borrower
shall cease to own of record and beneficially 100% of the Capital Stock of the US
Borrower, (C) the Permitted Investors shall cease to have the power to vote or direct
the voting of securities having a majority of the ordinary voting power for the election
of directors of Holdings (determined on a fully diluted basis), (D) the Permitted
Investors shall cease to own of record and beneficially an amount of Capital Stock of
Holdings equal to at least 51% of the amount of Capital Stock of Holdings owned by the
Permitted Investors of record and beneficially as of the Closing Date, (E) the board of
directors of Holdings shall cease to consist of a majority of Continuing Directors,
(ii) after consummation of an IPO, any “person” or “group” (as such terms are used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”)), excluding the Permitted Investors, shall become, or obtain
rights (whether by means of warrants, options or otherwise) to become, the “beneficial
owner” (as defined in Rules 13(d)-3 and
13(d)-5 under the Exchange Act), directly or
indirectly, of more than 20% of the outstanding Capital Stock of Holdings, or (iii) a
Specified Change of Control shall occur or;

     (m) Holdings shall (i) conduct, transact or otherwise engage in, or commit to
conduct, transact or otherwise engage in, any business or operations other than those
incidental to its ownership of the Capital Stock of the BVI Borrower or the issuance of
its own Capital Stock, (ii) incur, create, assume or suffer to exist any Indebtedness or
other liabilities or financial obligations, except (x) nonconsensual obligations imposed
by operation of law, (y) pursuant to the First Lien Loan Documents and the Second Lien
Loan Documents to which it is a party and (z) obligations with respect to its Capital
Stock, or (iii) own, lease, manage or otherwise operate any properties or assets
(including cash (other than cash received in connection with dividends made by the
Borrowers in accordance with Section 8.6 pending application in the manner contemplated
by said Section) and Cash Equivalents) other than the ownership of shares of Capital
Stock of the BVI Borrower;

then, and in any such event, (A) if such event is an Event of Default specified in clause (i) or
(ii) of paragraph (f) above with respect to either Borrower, automatically the Commitments shall
immediately terminate and the Loans hereunder (with accrued interest thereon) and all other amounts
owing under this Agreement and the other First Lien Loan Documents (including all amounts of L/C
Obligations, whether or not the beneficiaries of the then outstanding Letters of Credit shall have
presented the documents required thereunder) shall immediately become due and payable, and (B) if
such event is any other Event of Default, either or both of the following actions may be taken:
(i) with the consent of the Required Lenders, the Administrative Agent may, or upon the request of
the Required Lenders, the Administrative Agent shall, by notice to the Borrowers declare the
Revolving Commitments to be terminated forthwith, whereupon the Revolving Commitments shall
immediately terminate; and (ii) with the consent of the Required Lenders, the Administrative Agent
may, or upon the request of the Required Lenders, the Administrative Agent shall, by notice to the
Borrowers, declare the Loans hereunder (with accrued interest thereon) and all other amounts owing
under this Agreement and the other First Lien Loan Documents (including all amounts of L/C
Obligations, whether or not the beneficiaries of the then outstanding Letters of Credit shall have
presented the documents required thereunder) to be due and payable forthwith, whereupon the same
shall immediately become due and payable. With respect to all Letters of Credit with respect to
which presentment for honor shall not have occurred at the time of an acceleration pursuant to this
paragraph, the Borrowers shall at such time deposit in a cash collateral

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account opened by the Administrative Agent an amount equal to the aggregate then undrawn and
unexpired amount of such Letters of Credit. Amounts held in such cash collateral account shall be
applied by the Administrative Agent to the payment of drafts drawn under such Letters of Credit,
and the unused portion thereof after all such Letters of Credit shall have expired or been fully
drawn upon, if any, shall be applied to repay other obligations of the Borrowers hereunder and
under the other First Lien Loan Documents. After all such Letters of Credit shall have expired or
been fully drawn upon, all Reimbursement Obligations shall have been satisfied and all other
obligations of the Borrowers hereunder and under the other First Lien Loan Documents shall have
been paid in full, the balance, if any, in such cash collateral account shall be returned to the
Borrowers (or such other Person as may be lawfully entitled thereto). Except as expressly provided
above in this Section, presentment, demand, protest and all other notices of any kind are hereby
expressly waived by the Borrowers.

SECTION 10. THE AGENTS

     10.1. Appointment. Each Lender hereby irrevocably designates and appoints each Agent
as the agent of such Lender under this Agreement and the other First Lien Loan Documents, and each
such Lender irrevocably authorizes such Agent, in such capacity, to take such action on its behalf
under the provisions of this Agreement and the other First Lien Loan Documents and to exercise such
powers and perform such duties as are expressly delegated to such Agent by the terms of this
Agreement and the other First Lien Loan Documents, together with such other powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary elsewhere in this
Agreement, no Agent shall have any duties or responsibilities, except those expressly set forth
herein, or any fiduciary relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other
First Lien Loan Document or otherwise exist against any Agent.

     10.2. Delegation of Duties. Each Agent may execute any of its duties under this
Agreement and the other First Lien Loan Documents by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such duties. No Agent
shall be responsible for the negligence or misconduct of any agents or attorneys in-fact selected
by it with reasonable care.

     10.3. Exculpatory Provisions. Neither any Agent nor any of their respective officers,
directors, employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any action
lawfully taken or omitted to be taken by it or such Person under or in connection with this
Agreement or any other First Lien Loan Document (except to the extent that any of the foregoing are
found by a final and nonappealable decision of a court of competent jurisdiction to have resulted
from its or such Person’s own gross negligence or willful misconduct) or (ii) responsible in any
manner to any of the Lenders for any recitals, statements, representations or warranties made by
any Loan Party or any officer thereof contained in this Agreement or any other First Lien Loan
Document or in any certificate, report, statement or other document referred to or provided for in,
or received by the Agents under or in connection with, this Agreement or any other First Lien Loan
Document or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of
this Agreement or any other First Lien Loan Document or for any failure of any Loan Party a party
thereto to perform its obligations hereunder or thereunder. The Agents shall not be under any
obligation to any Lender to ascertain or to inquire as to the observance or performance of any of
the agreements contained in, or conditions of, this Agreement or any other First Lien Loan
Document, or to inspect the properties, books or records of any Loan Party.

     10.4. Reliance by Agents. Each Agent shall be entitled to rely, and shall be fully
protected in relying, upon any instrument, writing, resolution, notice, consent, certificate,
affidavit, letter, telecopy, telex or teletype message, statement, order or other document or
conversation believed by it to be genuine and correct and to have been signed, sent or made by the
proper Person or Persons and upon

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advice and statements of legal counsel (including counsel to the Borrowers), independent
accountants and other experts selected by such Agent. The Administrative Agent may deem and treat
the payee of any Note as the owner thereof for all purposes unless a written notice of assignment,
negotiation or transfer thereof shall have been filed with the Administrative Agent. Each Agent
shall be fully justified in failing or refusing to take any action under this Agreement or any
other First Lien Loan Document unless it shall first receive such advice or concurrence of the
Required Lenders (or, if so specified by this Agreement, all Lenders) as it deems appropriate or it
shall first be indemnified to its satisfaction by the Lenders against any and all liability and
expense that may be incurred by it by reason of taking or continuing to take any such action. The
Agents shall in all cases be fully protected in acting, or in refraining from acting, under this
Agreement and the other First Lien Loan Documents in accordance with a request of the Required
Lenders (or, if so specified by this Agreement, all Lenders), and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders and all future holders of
the Loans.

     10.5. Notice of Default. No Agent shall be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default hereunder unless such Agent has received notice from
a Lender or either Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a “notice of default”. In the event that the
Administrative Agent receives such a notice, the Administrative Agent shall give notice thereof to
the Lenders. The Administrative Agent shall take such action with respect to such Default or Event
of Default as shall be reasonably directed by the Required Lenders (or, if so specified by this
Agreement, all Lenders or any other instructing group of Lenders specified by this Agreement);
provided that unless and until the Administrative Agent shall have received such
directions, the Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of Default as it shall deem
advisable in the best interests of the Lenders (it being understood and agreed that any action by
the Administrative Agent without the direction or consent of the Required Lenders under clause (B)
of the final paragraph of Section 9 shall require the consent of the Syndication Agent).

     10.6. Non-Reliance on Agents and Other Lenders. Each Lender expressly acknowledges
that neither the Agents nor any of their respective officers, directors, employees, agents,
attorneys-in-fact or affiliates have made any representations or warranties to it and that no act
by any Agent hereafter taken, including any review of the affairs of a Loan Party or any affiliate
of a Loan Party, shall be deemed to constitute any representation or warranty by any Agent to any
Lender. Each Lender represents to the Agents that it has, independently and without reliance upon
any Agent or any other Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their affiliates and
made its own decision to make its Loans hereunder and enter into this Agreement. Each Lender also
represents that it will, independently and without reliance upon any Agent or any other Lender, and
based on such documents and information as it shall deem appropriate at the time, continue to make
its own credit analysis, appraisals and decisions in taking or not taking action under this
Agreement and the other First Lien Loan Documents, and to make such investigation as it deems
necessary to inform itself as to the business, operations, property, financial and other condition
and creditworthiness of the Loan Parties and their affiliates. Except for notices, reports and
other documents expressly required to be furnished to the Lenders by the Administrative Agent
hereunder, the Administrative Agent shall not have any duty or responsibility to provide any Lender
with any credit or other information concerning the business, operations, property, condition
(financial or otherwise), prospects or creditworthiness of any Loan Party or any affiliate of a
Loan Party that may come into the possession of the Administrative Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates.

     10.7. Indemnification. The Lenders agree to indemnify each Agent in its capacity as
such (to the extent not reimbursed by the Borrowers and without limiting the obligation of the
Borrowers

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to do so), ratably according to their respective Aggregate Exposure Percentages in effect on
the date on which indemnification is sought under this Section (or, if indemnification is sought
after the date upon which the Commitments shall have terminated and the Loans shall have been paid
in full, ratably in accordance with such Aggregate Exposure Percentages immediately prior to such
date), from and against any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind whatsoever that may at any time
(whether before or after the payment of the Loans) be imposed on, incurred by or asserted against
such Agent in any way relating to or arising out of, the Commitments, this Agreement, any of the
other First Lien Loan Documents or any documents contemplated by or referred to herein or therein
or the transactions contemplated hereby or thereby or any action taken or omitted by such Agent
under or in connection with any of the foregoing; provided that no Lender shall be liable
for the payment of any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements that are found by a final and
nonappealable decision of a court of competent jurisdiction to have resulted from such Agent’s
gross negligence or willful misconduct; and provided, further, that to the extent
any indemnification of the L/C Lender or the Issuing Bank is required pursuant to this Section
10.7, such indemnification shall be limited to Revolving Lenders only. The agreements in this
Section shall survive the payment of the Loans and all other amounts payable hereunder.

     10.8. Agent in Its Individual Capacity. Each Agent and its affiliates may make loans
to, accept deposits from and generally engage in any kind of business with any Loan Party as though
such Agent were not an Agent. With respect to its Loans made or renewed by it and with respect to
any Letter of Credit issued or participated in by it, each Agent shall have the same rights and
powers under this Agreement and the other First Lien Loan Documents as any Lender and may exercise
the same as though it were not an Agent, and the terms “Lender” and “Lenders” shall include each
Agent in its individual capacity.

     10.9. Successor Administrative Agent. The Administrative Agent may resign as
Administrative Agent upon 30 days’ notice to the Lenders and the Borrowers. If the Administrative
Agent shall resign as Administrative Agent under this Agreement and the other First Lien Loan
Documents, then the Required Lenders shall appoint from among the Lenders a successor agent for the
Lenders, which successor agent shall (unless an Event of Default with respect to either Borrower
shall have occurred and be continuing) be subject to approval by the Borrowers (which approval
shall not be unreasonably withheld or delayed), whereupon such successor agent shall succeed to the
rights, powers and duties of the Administrative Agent, and the term “Administrative Agent” shall
mean such successor agent effective upon such appointment and approval, and the former
Administrative Agent’s rights, powers and duties as Administrative Agent shall be terminated,
without any other or further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement or any holders of the Loans. If no successor agent has accepted
appointment as Administrative Agent by the date that is 10 days following a retiring Administrative
Agent’s notice of resignation, the retiring Administrative Agent’s resignation shall nevertheless
thereupon become effective and the Lenders shall assume and perform all of the duties of the
Administrative Agent hereunder until such time, if any, as the Required Lenders appoint a successor
agent as provided for above. After any retiring Administrative Agent’s resignation as
Administrative Agent, the provisions of this Section 10 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Administrative Agent under this Agreement
and the other First Lien Loan Documents.

     10.10. Agents Generally. Except as expressly set forth herein, no Agent shall have
any duties or responsibilities hereunder in its capacity as such.

     10.11. The Syndication Agent. Except as expressly set forth herein, the Syndication
Agent shall not have any obligations or liabilities hereunder and the rights of the Syndication
Agent under

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this Agreement shall terminate in the event General Electric Capital Corporation ceases to be
a Lender hereunder.

     10.12. The L/C Lender. Without limiting any rights otherwise granted herein to the
L/C Lender, it is understood and agreed that the L/C Lender (i) shall have all of the benefits and
immunities (x) provided to the Agents in this Section 10 with respect to their rights and
obligations under this Agreement and with respect to acts taken or omissions suffered by the L/C
Lender in connection with Letters of Credit issued or made under this Agreement and the documents
associated therewith as fully as if the term “Agents”, as used in this Section 10, included the L/C
Lender with respect to such acts or omissions and (y) as additionally provided in this Agreement
and (ii) shall have all of the benefits of the provisions of Section 10.7 as fully as if the term
“Agents”, as used in Section 10.7 included the L/C Lender; provided that any resignation by
the L/C Lender shall apply to its agreement to cause the issuance of Letters of Credit and,
provided further that if the L/C Lender shall resign (which may occur at any time
for any reason) and no successor L/C Lender shall be appointed, no additional Letters of Credit
shall be issued under this Agreement.

     10.13. First Lien Collateral Agent. To the extent applicable, the provisions of
Section 10 shall apply, mutatis mutandis, to JPMorgan Chase Bank, N.A. in its
capacity as First Lien Collateral Agent, and to any successor First Lien Collateral Agent,
provided that, notwithstanding Section 10.9, JPMorgan Chase Bank, N.A. as initial First
Lien Collateral Agent shall have the right to appoint a successor to itself as First Lien
Collateral Agent without the consent of the Borrowers or any Lender, provided that such successor
First Lien Collateral Agent is a bank, trust company or other financial institution of recognized
standing with an office located in New York City and is legally able to perform the functions of
the First Lien Collateral Agent under the First Lien Loan Documents (it being understood that any
fee to be charged by such successor First Lien Collateral Agent shall be subject to separate
agreement between the First Lien Collateral Agent and the Borrowers).

SECTION 11. MISCELLANEOUS

     11.1. Amendments and Waivers. Neither this Agreement, any other First Lien Loan
Document, nor any terms hereof or thereof may be amended, supplemented or modified except in
accordance with the provisions of this Section 11.1. The Required Lenders and each Loan Party
party to the relevant First Lien Loan Document may, or, with the written consent of the Required
Lenders, the Administrative Agent, the Syndication Agent (unless the Required Lenders have approved
the related documentation, in which event the approval of the Syndication Agent shall not be
required), and each Loan Party party to the relevant First Lien Loan Document may, from time to
time, (a) enter into written amendments, supplements or modifications hereto and to the other First
Lien Loan Documents for the purpose of adding any provisions to this Agreement or the other First
Lien Loan Documents or changing in any manner the rights of the Lenders or of the Loan Parties
hereunder or thereunder or (b) waive, on such terms and conditions as the Required Lenders or the
Administrative Agent and the Syndication Agent (unless the Required Lenders have approved the
related documentation, in which event the approval of the Syndication Agent shall not be required),
as the case may be, may specify in such instrument, any of the requirements of this Agreement or
the other First Lien Loan Documents or any Default or Event of Default and its consequences;
provided, however, that no such waiver and no such amendment, supplement or
modification shall (i) forgive or reduce the principal amount or extend the final scheduled date of
maturity of any Loan, extend the scheduled date of any amortization payment in respect of any First
Lien Term Loan, reduce the stated rate of any interest or fee (including the prepayment fee
provided for in Section 4.1(b)) payable hereunder (except (x) in connection with the waiver of
applicability of any post-default increase in interest rates, which waiver shall be effective with
the consent of the Majority Facility Lenders of each adversely affected Facility and (y) that any
amendment or modification of defined terms used in the financial covenants in this Agreement shall
not

66

 

constitute a reduction in the rate of interest or fees (including the prepayment fee provided
for in Section 4.1(b)) for purposes of this clause (i)) or extend the scheduled date of any payment
of interest or fees, or increase the amount or extend the expiration date of any Lender’s Revolving
Commitment, in each case without the written consent of each Lender directly affected thereby; (ii)
eliminate or reduce the voting rights of any Lender under this Section 11.1 without the written
consent of such Lender; (iii) reduce any percentage specified in the definition of Required
Lenders, consent to the assignment or transfer by either Borrower of any of its rights and
obligations under this Agreement and the other First Lien Loan Documents (other than a transfer of
such rights and obligations by the BVI Borrower to the US Borrower), release all or substantially
all of the Collateral or release Holdings or all or substantially all of the Subsidiary Guarantors
from their obligations under the First Lien Guarantee and Collateral Agreement, in each case
without the written consent of all Lenders; (iv) amend, modify or waive any condition precedent to
any extension of credit under the Revolving Facility set forth in Section 6.2 (including in
connection with any waiver of an existing Default or Event of Default) without the written consent
of the Majority Facility Lenders with respect to the Revolving Facility; (v) amend, modify or waive
any provision of Section 4.8 without the written consent of each Lender adversely affected thereby;
(vi) reduce the percentage specified in the definition of Majority Facility Lenders with respect to
any Facility without the written consent of all Lenders under such Facility; (vii) amend, modify or
waive any provision of Section 10 without the written consent of each Agent adversely affected
thereby; or (viii) amend, modify or waive any provision of Sections 3.5 to 3.12 without the written
consent of the L/C Lender. Any such waiver and any such amendment, supplement or modification
shall apply equally to each of the Lenders and shall be binding upon the Loan Parties, the Lenders,
the Agents and all future holders of the Loans. In the case of any waiver, the Loan Parties, the
Lenders and the Agents shall be restored to their former position and rights hereunder and under
the other First Lien Loan Documents, and any Default or Event of Default waived shall be deemed to
be cured and not continuing; but no such waiver shall extend to any subsequent or other Default or
Event of Default, or impair any right consequent thereon.

     11.2. Notices. All notices, requests and demands to or upon the respective parties
hereto to be effective shall be in writing (including by telecopy) or telephonic notice (promptly
confirmed in writing), and, unless otherwise expressly provided herein, shall be deemed to have
been duly given or made when delivered, or three Business Days after being deposited in the mail,
postage prepaid, or, in the case of telecopy notice, when received, addressed as follows in the
case of the Borrowers and the Agents, and as set forth in an administrative questionnaire delivered
to the Administrative Agent in the case of the Lenders, or to such other address as may be
hereafter notified by the respective parties hereto:

	 	 	 
	The Borrowers:

	 	FGX International Inc.

FGX International Limited

c/o AAi.FosterGrant, Inc.

500 George Washington Highway

Smithfield, RI 02917

Attention: Mr. Jack Flynn

Telecopy: (401) 231-3212

Telephone: (401) 719-2102
	 
	 	 
	with copies to:

	 	Berggruen Holdings Inc.

1114 Avenue of the Americas, 41st Floor

New York, NY 10036

Attention: Jared Bluestein

Telecopy: (212) 382-0121

Telephone: (212) 382-2235

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	The Administrative Agent:

	 	JPMorgan Chase Bank, N.A.

270 Park Avenue

New York, NY 10017

Attention: Katherine Duncan

Telecopy: (212) 270-5808

Telephone: (212) 270-6637
	 
	 	 
	with a copy to:

	 	JPMorgan Chase Bank, N.A.

Loan and Agency Services

1111 Fannin Street

Houston, TX 77002

Attention: Sharon Craft

Telecopy: (713) 750-2666

Telephone: (713) 750-7911

and

Attention: Stacey Ahrendt

Telecopy: (713) 750-2666

Telephone: (713) 750-3524
	 
	 	 
	Syndication Agent:

	 	General Electric Capital Corporation

401 Merritt Seven

Norwalk, CT 06856

Attention: Pier Meager

Telecopy: 203-229-1432

Telephone: 203-229-1955

provided that any notice, request or demand to or upon any Agent, the L/C Lender or the
Lenders shall not be effective until received.

     Notices and other communications to the Lenders hereunder may be delivered or furnished by
electronic communications pursuant to procedures approved by the Administrative Agent;
provided that the foregoing shall not apply to notices pursuant to Section 2 unless
otherwise agreed by the Administrative Agent and the applicable Lender. The Administrative Agent
or the Borrowers may, in their discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it; provided that
approval of such procedures may be limited to particular notices or communications.

     11.3. No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of any Agent or any Lender, any right, remedy, power or privilege hereunder
or under the other First Lien Loan Documents shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy, power or privilege hereunder 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.

     11.4. Survival of Representations and Warranties. All representations and warranties
made hereunder, in the other First Lien Loan Documents and in any document, certificate or
statement

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delivered pursuant hereto or in connection herewith shall survive the execution and delivery
of this Agreement and the making of the Loans and other extensions of credit hereunder.

     11.5. Payment of Expenses and Taxes. The Borrowers jointly and severally agree (a) to
pay or reimburse each Agent for all its reasonable out-of-pocket costs and expenses incurred in
connection with the development, preparation and execution of, and any amendment, supplement or
modification to, this Agreement and the other First Lien Loan Documents and any other documents
prepared in connection herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, including the reasonable fees and disbursements of
counsel to such Agent and filing and recording fees and expenses, with statements with respect to
the foregoing to be submitted to the Borrowers prior to the Closing Date (in the case of amounts to
be paid on the Closing Date) and from time to time thereafter on a quarterly basis or such other
periodic basis as such Agent shall deem appropriate, (b) to pay or reimburse each Lender and Agent
for all its costs and expenses incurred in connection with the enforcement or preservation of any
rights under this Agreement, the other First Lien Loan Documents and any such other documents,
including the fees and disbursements of counsel (including the allocated fees and expenses of
in-house counsel) to each Lender and of counsel to such Agent, (c) without duplication with respect
to amounts payable under Section 4.10(a), to pay, indemnify, and hold each Lender and Agent
harmless from, any and all recording and filing fees and any and all liabilities with respect to,
or resulting from any delay in paying and Other Taxes, if any, that may be payable or determined to
be payable in connection with the execution and delivery of, or consummation or administration of
any of the transactions contemplated by, or any amendment, supplement or modification of, or any
waiver or consent under or in respect of, this Agreement, the other First Lien Loan Documents and
any such other documents, and (d) to pay, indemnify, and hold each Lender and Agent and their
respective officers, directors, employees, affiliates, trustees, advisors, agents and controlling
persons (each, an “Indemnitee”) harmless from and against any and all other liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever with respect to the execution, delivery,
enforcement, performance and administration of this Agreement, the other First Lien Loan Documents
and any such other documents, including any of the foregoing relating to the use of proceeds of the
Loans or the violation of, noncompliance with or liability under, any Environmental Law applicable
to the operations of any Group Member or any of the Properties and the reasonable fees and expenses
of legal counsel in connection with claims, actions or proceedings by any Indemnitee against any
Loan Party under any First Lien Loan Document (all the foregoing in this clause (d), collectively,
the “Indemnified Liabilities”), provided, that the Borrowers shall have no
obligation hereunder to any Indemnitee with respect to Indemnified Liabilities to the extent such
Indemnified Liabilities are found by a final and nonappealable decision of a court of competent
jurisdiction to have resulted from the gross negligence or willful misconduct of such Indemnitee.
Without limiting the foregoing, and to the extent permitted by applicable law, the Borrowers
jointly and severally agree not to assert and to cause their Subsidiaries not to assert, and hereby
waive and agree to cause their Subsidiaries to waive, all rights for contribution or any other
rights of recovery with respect to all claims, demands, penalties, fines, liabilities, settlements,
damages, costs and expenses of whatever kind or nature, under or related to Environmental Laws,
that any of them might have by statute or otherwise against any Indemnitee. All amounts due under
this Section 11.5 shall be payable not later than 10 days after written demand therefor.
Statements payable by the Borrowers pursuant to this Section 11.5 shall be submitted to Jared
Bluestein (Telephone No. (212) 382-2235) (Telecopy No. (212) 382-0121) at the address of the
Borrowers set forth in Section 11.2, or to such other Person or address as may be hereafter
designated by the Borrowers in a written notice to the Administrative Agent. The agreements in
this Section 11.5 shall survive repayment of the Loans and all other amounts payable hereunder.

     11.6. Successors and Assigns; Participations and Assignments. xxiv) 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 (including any affiliate of the Issuing Bank or
the L/C Lender

69

 

that issues any Letter of Credit or causes any Letter of Credit to be issued), except that (i)
neither Borrower may assign or otherwise transfer any of its rights or obligations hereunder
(except such an assignment or transfer by the BVI Borrower to the US Borrower) without the prior
written consent of each Lender (and any attempted assignment or transfer by such Borrower without
such consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its rights
or obligations hereunder except in accordance with this Section.

     (a) (1) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign
to one or more assignees (each, an “Assignee”) all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitments and the Loans at
the time owing to it) with the prior written consent (such consent not to be unreasonably withheld
or delayed) of:

     (A) the Borrowers, provided that no consent of the Borrowers shall be
required for (x) an assignment to a Lender, an affiliate of a Lender, an Approved
Fund (as defined below) or, if an Event of Default has occurred and is continuing,
any other Person, (y) any assignment by the Administrative Agent or the Syndication
Agent (or their respective affiliates) or (z) any assignment of First Lien Term
Loans; and

     (B) the Administrative Agent, provided that no consent of the
Administrative Agent shall be required for (x) an assignment to an Assignee that is
a Lender immediately prior to giving effect to such assignment, except in the case
of an assignment of a Revolving Commitment to an Assignee that does not already have
a Revolving Commitment,(y) any assignment by the Administrative Agent or the
Syndication Agent (or their respective affiliates) or (z) any assignment of First
Lien Term Loans; and

     (C) in the case of any assignment of a Revolving Commitment, the L/C Lender.
 

     (ii) Assignments shall be subject to the following additional conditions:

     (A) except in the case of an assignment to a Lender, an affiliate of a Lender
or an Approved Fund or an assignment of the entire remaining amount of the assigning
Lender’s Commitments or Loans under any Facility, the amount of the Commitments or
Loans of the assigning Lender subject to each such assignment (determined as of the
date the Assignment and Assumption with respect to such assignment is delivered to
the Administrative Agent) shall not be less than $1,000,000 (in the case of the
First Lien Term Facility) or $2,500,000 (in the case the of the Revolving Facility)
unless each of the Borrowers and the Administrative Agent otherwise consent,
provided that (1) no such consent of the Borrowers shall be required if an
Event of Default has occurred and is continuing and (2) such amounts shall be
aggregated in respect of each Lender and its affiliates or Approved Funds, if any;

     (B) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption;

     (C) the Assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an administrative questionnaire; and

     (D) in the case of an assignment by a Lender to a CLO (as defined below)
managed or administered by such Lender or by an Affiliate of such Lender, the
assigning Lender shall retain the sole right to approve any amendment, modification
or waiver of

70

 

any provision of this Agreement and the other First Lien Loan Documents,
provided that the Assignment and Assumption between such Lender and such CLO
may provide that such Lender will not, without the consent of such CLO, agree to any
amendment, modification or waiver that (1) requires the consent of each Lender
directly affected thereby pursuant to the proviso to the second sentence of Section
11.1 and (2) directly affects such CLO.

     For the purposes of this Section 11.6, the terms “Approved Fund” and “CLO” have the following
meanings:

     “Approved Fund” means (a) with respect to any Lender, a CLO managed by such Lender or
by an Affiliate of such Lender and (b) with respect to any Lender that is a fund which invests in
bank loans and similar extensions of credit, any other fund that invests in bank loans and similar
extensions of credit and is managed by the same investment advisor as such Lender or by an
affiliate of such investment advisor.

     “CLO” means any entity (whether a corporation, partnership, trust or otherwise) that
is engaged in making, purchasing, holding or otherwise investing in bank loans and similar
extensions of credit in the ordinary course and is administered or managed by a Lender or an
affiliate of such Lender.

     (iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) below, from
and after the effective date specified in each Assignment and Assumption the Assignee thereunder
shall be a party hereto and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption,
be released from its obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of
Sections 4.9, 4.10, 4.11 and 11.5). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 11.6 shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with paragraph (c) of this Section.

     (iv) The Administrative Agent, acting for this purpose as an agent of the Borrowers, shall
maintain at one of its offices a copy of each Assignment and Assumption delivered to it and a
register for the recordation of the names and addresses of the Lenders, and the Commitments of, and
principal amount of the Loans and L/C Obligations owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”). The entries in the Register shall be
conclusive, and the Borrowers, the Administrative Agent, the L/C Lender and the Lenders may treat
each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register
shall be available for inspection by the Borrowers, the L/C Lender and any Lender, at any
reasonable time and from time to time upon reasonable prior notice.

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

71

 

     (b) (i) Any Lender may, without the consent of the Borrowers or the Required Lenders, sell
participations to one or more banks or other entities (a “Participant”) in all or a portion
of such Lender’s rights and obligations under this Agreement (including all or a portion of its
Commitments and the Loans owing to it); provided that (A) such Lender’s obligations under
this Agreement shall remain unchanged, (B) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations and (C) the Borrower, the Administrative
Agent, the Syndication Agent, the L/C Lender and the other Lenders shall continue to deal solely
and directly with such Lender in connection with such Lender’s rights and obligations under this
Agreement. Any agreement pursuant to which a Lender sells such a participation shall provide that
such Lender shall retain the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such agreement may
provide that such Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver that (1) requires the consent of each Lender directly affected thereby
pursuant to the proviso to the second sentence of Section 11.1 and (2) directly affects such
Participant. Subject to paragraph (c)(ii) of this Section, the Borrowers jointly and severally
agree that each Participant shall be entitled to the benefits of Sections 4.9, 4.10 and 4.11 to the
same extent as if it were a Lender and had acquired its interest by assignment pursuant to
paragraph (b) of this Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 11.7(b) as though it were a Lender, provided such Participant
shall be subject to Section 11.7(a) as though it were a Lender.

     (ii) A Participant shall not be entitled to receive any greater payment under Section 4.9 or
4.10 than the applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to such Participant is
made with the Borrowers’ prior written consent. A Participant shall not be entitled to the
benefits of Section 4.10 unless such Participant complies with Sections 4.10(d) and (e), as
applicable.

     (c) Any Lender may, without the consent of the Borrowers or the Administrative Agent, at any
time pledge or assign a security interest in all or any portion of its rights under this Agreement
to secure obligations of such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this Section shall not apply to any such pledge or assignment of a
security interest; provided that no such pledge or assignment of a security interest shall
release a Lender from any of its obligations hereunder or substitute any such pledgee or Assignee
for such Lender as a party hereto.

     (d) The Borrowers, upon receipt of written notice from the relevant Lender, jointly and
severally agree to issue Notes to any Lender requiring Notes to facilitate transactions of the type
described in paragraph (d) above.

     (e) Notwithstanding the foregoing, any Conduit Lender may assign any or all of the Loans it
may have funded hereunder to its designating Lender without the consent of the Borrowers or the
Administrative Agent and without regard to the limitations set forth in Section 11.6(b). Each of
Borrower, each Lender and the Administrative Agent hereby confirms that it will not institute
against a Conduit Lender or join any other Person in instituting against a Conduit Lender any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding under any state
bankruptcy or similar law, for one year and one day after the payment in full of the latest
maturing commercial paper note issued by such Conduit Lender; provided, however,
that each Lender designating any Conduit Lender hereby agrees to indemnify, save and hold harmless
each other party hereto for any loss, cost, damage or expense arising out of its inability to
institute such a proceeding against such Conduit Lender during such period of forbearance.

     11.7. Adjustments; Set-off. xxv) Except to the extent that this Agreement expressly
provides for payments to be allocated to a particular Lender or to the Lenders under a particular
Facility,

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if any Lender (a “Benefitted Lender”) shall, at any time after the Loans and other
amounts payable hereunder shall immediately become due and payable pursuant to Section 9, receive
any payment of all or part of the Obligations owing to it, or receive any collateral in respect
thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or proceedings of the
nature referred to in Section 9(g), or otherwise), in a greater proportion than any such payment to
or collateral received by any other Lender, if any, in respect of the Obligations owing to such
other Lender, such Benefitted Lender shall purchase for cash from the other Lenders a participating
interest in such portion of the Obligations owing to each such other Lender, or shall provide such
other Lenders with the benefits of any such collateral, as shall be necessary to cause such
Benefitted Lender to share the excess payment or benefits of such collateral ratably with each of
the Lenders; provided, however, that if all or any portion of such excess payment
or benefits is thereafter recovered from such Benefitted Lender, such purchase shall be rescinded,
and the purchase price and benefits returned, to the extent of such recovery, but without interest.

     (a) In addition to any rights and remedies of the Lenders provided by law, each Lender shall
have the right, without prior notice to either Borrower, any such notice being expressly waived by
such Borrower to the extent permitted by applicable law, upon any amount becoming due and payable
by either Borrower hereunder (whether at the stated maturity, by acceleration or otherwise), to set
off and appropriate and apply against such amount any and all deposits (general or special, time or
demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in
any currency, in each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Lender or any branch or agency thereof to or for the
credit or the account of either Borrower. Each Lender agrees promptly to notify the Borrowers and
the Administrative Agent after any such setoff and application made by such Lender,
provided that the failure to give such notice shall not affect the validity of such setoff
and application.

     11.8. Counterparts. This Agreement may be executed by one or more of the parties to
this Agreement on any number of separate counterparts, and all of said counterparts taken together
shall be deemed to constitute one and the same instrument. Delivery of an executed signature page
of this Agreement by facsimile transmission shall be effective as delivery of a manually executed
counterpart hereof. A set of the copies of this Agreement signed by all the parties shall be
lodged with the Borrowers and the Administrative Agent.

     11.9. Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

     11.10. Integration. This Agreement and the other First Lien Loan Documents represent
the entire agreement of the Borrowers, the Agents and the Lenders with respect to the subject
matter hereof and thereof, and there are no promises, undertakings, representations or warranties
by any Agent or any Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other First Lien Loan Documents.

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     11.11. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF NEW YORK.

     11.12. Submission To Jurisdiction; Waivers. (i) Each Borrower hereby irrevocably and
unconditionally:

     (i) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other First Lien Loan Documents to
which it is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the courts of the State of New
York, the courts of the United States for the Southern District of New York, and
appellate courts from any thereof;

     (ii) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same;

     (iii) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to such Borrower, as the case
may be at its address set forth in Section 11.2 or at such other address of which
the Administrative Agent shall have been notified pursuant thereto;

     (iv) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the right to
sue in any other jurisdiction; and

     (v) waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.

     (b) For the purpose of proceedings in the Courts of the State of New York and the United
States Courts for the Southern District of New York, in each case sitting in the Borough of
Manhattan, relating to this Agreement and the other First Lien Loan Documents to which it is a
party, the BVI Borrower hereby irrevocably designates as of the Closing Date CT Corporation System
with offices currently located at 111 Eighth Avenue, New York, New York 10011 as its agent for
service of process. In the event that such agent or any successor shall cease to be located in the
Borough of Manhattan, the BVI Borrower shall promptly and irrevocably before the relocation of such
agent for service of process, if practicable, or promptly thereafter designate a successor agent,
which successor agent shall be located in the Borough of Manhattan, and notify the Administrative
Agent thereof, to accept on their behalf service of any and all process or other documents which
may be served in any action or proceeding in any of such courts and further agrees that service
upon such agent shall constitute valid and effective service upon the BVI Borrower and that failure
of any such agent to give any notice of such service to the BVI Borrower shall not affect the
validity of such service or any judgment rendered in any action or proceeding based thereon.
Excepting the BVI Borrower, each of the parties hereto agrees that service of any and all such
process or other documents on such person may also be effected by registered mail to its address as
set forth in Section 11.2. With respect to the BVI Borrower, service, of any and all such process
or other

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documents to CT Corporation or such other agent for service of process designated by the BVI
Borrower in accordance with this Agreement, shall constitute valid and effective service only if
made in person.

     11.13. Acknowledgments. Each Borrower hereby acknowledges that:

     (a) it has been advised by counsel in the negotiation, execution and delivery of
this Agreement and the other First Lien Loan Documents;

     (b) no Agent or Lender has any fiduciary relationship with or duty to either
Borrower arising out of or in connection with this Agreement or any of the other First
Lien Loan Documents, and the relationship between the Agents and Lenders, on one hand,
and the Borrowers, on the other hand, in connection herewith or therewith is solely that
of debtor and creditor; and

     (c) no joint venture is created hereby or by the other First Lien Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the Lenders or
among the Borrowers and the Lenders.

     11.14. Releases of Guarantees and Liens. xxvi) Notwithstanding anything to the
contrary contained herein or in any other First Lien Loan Document, the Administrative Agent is
hereby irrevocably authorized by each Lender (without requirement of notice to or consent of any
Lender except as expressly required by Section 11.1) to take any action requested by the Borrowers
having the effect of releasing any Collateral or guarantee obligations (i) to the extent necessary
to permit consummation of any transaction not prohibited by any First Lien Loan Document or that
has been consented to in accordance with Section 11.1 or (ii) under the circumstances described in
paragraph (b) below.

     (a) At such time as the Loans, the Reimbursement Obligations and the other obligations under
the First Lien Loan Documents (other than obligations under or in respect of Hedge Agreements)
shall have been paid in full, the Commitments have been terminated and no Letters of Credit shall
be outstanding, the Collateral shall be released from the Liens created by the First Lien Security
Documents, and the First Lien Security Documents and all obligations (other than those expressly
stated to survive such termination) of the Administrative Agent and each Loan Party under the First
Lien Security Documents shall terminate, all without delivery of any instrument or performance of
any act by any Person.

     11.15. Confidentiality. Each Agent and each Lender agrees to use commercially
reasonable efforts (equivalent to the efforts such Agent or such Lender applies to maintaining the
confidentiality of its own confidential non-public information) to keep confidential all non-public
information provided to it by any Loan Party pursuant to this Agreement that is designated by such
Loan Party as confidential for a period of two years following the receipt thereof;
provided that nothing herein shall prevent any Agent or any Lender from disclosing any such
information (a) to any Agent, any other Lender or any Lender Affiliate, (b) subject to an agreement
to comply with the provisions of this Section, to any actual or prospective Transferee or any
direct or indirect counterparty to any Hedge Agreement (or any professional advisor to such
counterparty), (c) to its employees, directors, trustees, agents, attorneys, accountants and other
professional advisors or those of any of its affiliates, (d) upon the request or demand of any
Governmental Authority, (e) in response to any order of any court or other Governmental Authority
or as may otherwise be required pursuant to any Requirement of Law, (f) if requested or required to
do so in connection with any litigation or similar proceeding, (g) that has been publicly
disclosed, (h) to the National Association of Insurance Commissioners or any similar organization
or any nationally recognized rating agency that requires access to information about a Lender’s
investment portfolio in connection with ratings issued with respect to such Lender, or (i) in
connection with the

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exercise of any remedy hereunder or under any other First Lien Loan Document. Notwithstanding
anything herein to the contrary, any party subject to confidentiality obligations hereunder or
under any other related document (and any employee, representative or other agent of such party)
may disclose to any and all persons, without limitation of any kind, such party’s U.S. federal
income tax treatment and the U.S. federal income tax structure of the transactions contemplated by
this Agreement relating to such party and all materials of any kind (including opinions or other
tax analyses) that are provided to it relating to such tax treatment and tax structure. However,
no such party shall disclose any information relating to such tax treatment or tax structure to the
extent nondisclosure is reasonably necessary in order to comply with applicable securities laws.

     11.16. Joint and Several Liability. Without limiting the foregoing, all Revolving
Loans to the Borrowers, upon funding, shall be deemed to be jointly funded to and received by the
Borrowers. Each Borrower jointly and severally agrees to pay, and shall be jointly and severally
liable under this Agreement for, all Obligations in respect of Revolving Loans, regardless of the
manner or amount in which proceeds of any Revolving Loans are used, allocated, shared, or disbursed
by or among the Borrowers themselves, or the manner in which any Agent and/or any Lender accounts
for such Revolving Loans or other extensions of credit on its books and records. Each Borrower
shall be liable for all amounts due to any Agent or any Lender under this Agreement which
constitute Obligations in respect of Revolving Loans, regardless of which Borrower actually
receives Revolving Loans or other extensions of credit under the Revolving Facility or the amount
of such Revolving Loans and extensions of credit received or the manner in which such Agent or such
Lender accounts for such Revolving Loans or other extensions of credit on its books and records.
Each Borrower’s obligations with respect to Revolving Loans and other extensions of credit made to
it under the Revolving Facility, and such Borrower’s obligations arising as a result of the joint
and several liability of such Borrower under the Revolving Facility, with respect to Revolving
Loans made to the other Borrower hereunder, shall be separate and distinct obligations, but all
such Obligations shall be primary obligations of such Borrower. The Borrowers acknowledge and
expressly agree with each Agent and each Lender that the joint and several liability of each
Borrower in respect of the Revolving Loans is required solely as a condition to, and is given
solely as inducement for and in consideration of, credit or accommodations extended or to be
extended under the First Lien Loan Documents to the other Borrower and is not required or given as
a condition of extensions of credit to such Borrower.

     11.17. Judgment Currency. xxvii) The Borrowers’ obligations hereunder and under the
other First Lien Loan Documents to make payments in Dollars shall not be discharged or satisfied by
any tender or recovery pursuant to any judgment expressed in or converted into any currency other
than Dollars, except to the extent that such tender or recovery results in the effective receipt by
the Administrative Agent or a Lender of the full amount of Dollars expressed to be payable to the
Administrative Agent or such Lender under this Agreement or the other First Lien Loan Documents.
If, for the purpose of obtaining or enforcing judgment against any Loan Party in any court or in
any jurisdiction, it becomes necessary to convert into or from any currency other than Dollars
(such other currency being hereinafter referred to as the “Judgment Currency”) an amount
due in Dollars, the conversion shall be made, at the rate of exchange (as quoted by the
Administrative Agent or if the Administrative Agent does not quote a rate of exchange on such
currency, by a known dealer in such currency designated by the Administrative Agent) determined, in
each case, as of the Business Day immediately preceding the date on which the judgment is given
(such Business Day being hereinafter referred to as the “Judgment Currency Conversion
Date”).

     (a) If there is a change in the rate of exchange prevailing between the Judgment Currency
Conversion Date and the date of actual payment of the amount due, the Borrowers jointly and
severally covenant and agree to pay, or cause to be paid, such additional amounts, if any (but in
any event

76

 

not a lesser amount), as may be necessary to ensure that the amount paid in the Judgment
Currency, when converted at the rate of exchange prevailing on the date of payment, will produce
the amount of Dollars which could have been purchased with the amount of Judgment Currency
stipulated in the judgment or judicial award at the rate of exchange prevailing on the Judgment
Currency Conversion Date.

     (b) For purposes of determining any rate of exchange or currency equivalent for this Section,
such amounts shall include any premium and costs payable in connection with the purchase of
Dollars.

     11.18. WAIVERS OF JURY TRIAL. THE BORROWERS, THE AGENTS AND THE LENDERS HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO
THIS AGREEMENT OR ANY OTHER FIRST LIEN LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

     11.19. Delivery of Addenda. Each initial Lender shall become a party to this
Agreement by delivering to the Administrative Agent an Addendum duly executed by such Lender.

[signature page follows]

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

	 	 	 	 	 
	 	FGX INTERNATIONAL INC.

 	 
	 	By:  	/ s / Brian J. Lagarto
 	 
	 	 	Name:  	Brian J. Lagarto 	 
	 	 	Title:  	CFO 	 
	 
	 	FGX INTERNATIONAL LIMITED

 	 
	 	By:  	/ s / Brian J. Lagarto
 	 
	 	 	Name:  	Brian J. Lagarto 	 
	 	 	Title:  	CFO 	 
	 

Credit Agreement

 

	 	 	 	 	 
	 	JPMORGAN CHASE BANK, N.A., as Administrative

Agent and as Lender

 	 
	 	By:  	/s/ Kathryn A. Duncan
 	 
	 	 	Name:  	Kathryn A. Duncan 	 
	 	 	Title:  	Vice President 	 
	 

First Lien Credit Agreement

 

	 	 	 	 	 
	 	GENERAL ELECTRIC CAPITAL CORPORATION, as

Syndication Agent and as Lender

 	 
	 	By:  	/s/ Pier Meager
 	 
	 	 	Name:  	Pier Meager 	 
	 	 	Title:  	Authorized Signatory 	 
	 

First Lien Credit Agreement

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