Document:

exv10w1

 

Exhibit 10.1

EXECUTION COPY

      

$280,000,000

AMENDED AND RESTATED CREDIT AGREEMENT

among

GENCORP INC.,

as Borrower,

ITS MATERIAL DOMESTIC SUBSIDIARIES

FROM TIME TO TIME PARTIES HERETO,

as Guarantors,

THE LENDERS PARTIES HERETO,

WACHOVIA BANK, NATIONAL ASSOCIATION,

as Administrative Agent,

JPMORGAN CHASE BANK, N.A.,

as Syndication Agent,

Dated as of June 21, 2007

and

WACHOVIA CAPITAL MARKETS, LLC

and

J.P. MORGAN SECURITIES INC.

as Joint Lead Arrangers and Joint Book Runners

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	 	Page
	ARTICLE I DEFINITIONS
	 	 	1	 
	Section 1.1 Defined Terms
	 	 	1	 
	Section 1.2 Other Definitional Provisions
	 	 	38	 
	Section 1.3 Accounting Terms
	 	 	39	 
	Section 1.4 Time References
	 	 	39	 
	Section 1.5 Execution of Documents
	 	 	39	 
	 
	 	 	 	 
	ARTICLE II THE LOANS; AMOUNT AND TERMS
	 	 	40	 
	Section 2.1 Revolving Loans
	 	 	40	 
	Section 2.2 Revolving Letter of Credit Subfacility
	 	 	42	 
	Section 2.3 Swingline Loan Subfacility
	 	 	46	 
	Section 2.4 Credit-Linked Facility—Term Loan Subfacility
	 	 	48	 
	Section 2.5 Credit-Linked Facility – Letter of Credit Subfacility
	 	 	50	 
	Section 2.6 Credit-Linked Deposits
	 	 	55	 
	Section 2.7 Fees
	 	 	56	 
	Section 2.8 Commitment Reductions
	 	 	57	 
	Section 2.9 Prepayments
	 	 	58	 
	Section 2.10 Default Rate and Payment Dates
	 	 	61	 
	Section 2.11 Conversion Options
	 	 	62	 
	Section 2.12 Computation of Interest and Fees
	 	 	62	 
	Section 2.13 Pro Rata Treatment and Payments
	 	 	64	 
	Section 2.14 Non-Receipt of Funds by the Administrative Agent
	 	 	66	 
	Section 2.15 Inability to Determine Interest Rate
	 	 	67	 
	Section 2.16 Illegality
	 	 	68	 
	Section 2.17 Yield Protection
	 	 	68	 
	Section 2.18 Indemnity
	 	 	70	 
	Section 2.19 Taxes
	 	 	70	 
	Section 2.20 Indemnification; Nature of Issuing Lender’s Duties
	 	 	73	 
	Section 2.21 Replacement of Lenders
	 	 	74	 
	Section 2.22 Incremental Term Loan
	 	 	75	 
	 
	 	 	 	 
	ARTICLE III REPRESENTATIONS AND WARRANTIES
	 	 	75	 
	Section 3.1 Financial Condition
	 	 	75	 
	Section 3.2 No Change
	 	 	76	 
	Section 3.3 Corporate Existence
	 	 	76	 
	Section 3.4 Corporate Power; Authorization; Enforceable Obligations
	 	 	76	 
	Section 3.5 Compliance with Laws; No Conflict; No Default
	 	 	77	 
	Section 3.6 No Material Litigation
	 	 	78	 
	Section 3.7 Investment Company Act.
	 	 	78	 
	Section 3.8 Margin Regulations
	 	 	78	 
	Section 3.9 ERISA
	 	 	78	 
	Section 3.10 Environmental Matters
	 	 	79	 
	Section 3.11 Use of Proceeds
	 	 	80	 
	Section 3.12 Subsidiaries
	 	 	80	 

i

 

	 	 	 	 	 
	 	 	 	Page
	Section 3.13 Ownership
	 	 	80	 
	Section 3.14 Indebtedness
	 	 	81	 
	Section 3.15 Taxes
	 	 	81	 
	Section 3.16 Intellectual Property Rights
	 	 	81	 
	Section 3.17 Solvency
	 	 	82	 
	Section 3.18 Investments
	 	 	82	 
	Section 3.19 Location of Collateral
	 	 	82	 
	Section 3.20 No Burdensome Restrictions
	 	 	82	 
	Section 3.21 Brokers’ Fees
	 	 	82	 
	Section 3.22 Labor Matters
	 	 	83	 
	Section 3.23 Accuracy and Completeness of Information
	 	 	83	 
	Section 3.24 Material Contracts
	 	 	83	 
	Section 3.25 Insurance
	 	 	83	 
	Section 3.26 Security Documents
	 	 	83	 
	Section 3.27 Regulation H
	 	 	84	 
	Section 3.28 Classification of Senior Indebtedness
	 	 	84	 
	Section 3.29 Anti-Terrorism Laws
	 	 	84	 
	Section 3.30 Compliance with OFAC Rules and Regulations
	 	 	84	 
	Section 3.31 Compliance with FCPA
	 	 	84	 
	 
	 	 	 	 
	ARTICLE IV CONDITIONS PRECEDENT
	 	 	85	 
	Section 4.1 Conditions to Closing Date
	 	 	85	 
	Section 4.2 Conditions to All Extensions of Credit
	 	 	90	 
	 
	 	 	 	 
	ARTICLE V AFFIRMATIVE COVENANTS
	 	 	91	 
	Section 5.1 Financial Statements
	 	 	91	 
	Section 5.2 Certificates; Other Information
	 	 	93	 
	Section 5.3 Payment of Taxes; Other Obligations; Performance of Certain Other Agreements

	 	 	94	 
	
Section 5.4 Conduct of Business and Maintenance of Existence
	 	 	95	 
	Section 5.5 Maintenance of Property; Insurance
	 	 	95	 
	Section 5.6 Inspection of Property; Books and Records; Discussions
	 	 	96	 
	Section 5.7 Notices
	 	 	96	 
	Section 5.8 Environmental Laws
	 	 	97	 
	Section 5.9 Financial Covenants
	 	 	98	 
	Section 5.10 Additional Guarantors
	 	 	99	 
	Section 5.11 Compliance with Law
	 	 	99	 
	Section 5.12 Pledged Assets
	 	 	99	 
	Section 5.13 Covenants Regarding Patents, Trademarks and Copyrights
	 	 	100	 
	Section 5.14 Landlord Waivers
	 	 	102	 
	Section 5.15 Further Assurances
	 	 	102	 
	Section 5.16 Permitted Real Estate Entities
	 	 	103	 
	 
	 	 	 	 
	ARTICLE VI NEGATIVE COVENANTS
	 	 	104	 
	Section 6.1 Indebtedness
	 	 	104	 
	Section 6.2 Liens
	 	 	107	 
	Section 6.3 Nature of Business
	 	 	107	 
	Section 6.4 Consolidation,
Merger, Sale or Purchase of Assets, etc.
	 	 	107	 

ii

 

	 	 	 	 	 
	 	 	 	Page
	Section 6.5 Advances, Investments and Loans
	 	 	109	 
	Section 6.6 Transactions with Affiliates
	 	 	109	 
	Section 6.7 Ownership of Subsidiaries; Restrictions
	 	 	109	 
	Section 6.8 Fiscal Year; Organizational Documents; Material Contracts; Accounting Policies
	 	 	110	 
	Section 6.9 Limitation on Restricted Actions and Impediments to Foreclosure
	 	 	110	 
	Section 6.10 Restricted Payments
	 	 	111	 
	
Section 6.11 Amendment of Subordinated Dabt
	 	 	112	 
	Section 6.12 Sale Leasebacks
	 	 	112	 
	Section 6.13 No Further Negative Pledges
	 	 	112	 
	Section 6.14 Accounts
	 	 	112	 
	 
	 	 	 	 
	ARTICLE VII EVENTS OF DEFAULT
	 	 	113	 
	Section 7.1 Events of Default
	 	 	113	 
	Section 7.2 Acceleration; Remedies
	 	 	116	 
	 
	 	 	 	 
	ARTICLE VIII THE ADMINISTRATIVE AGENT
	 	 	117	 
	Section 8.1 Appointment and Authority
	 	 	117	 
	Section 8.2 Nature of Duties
	 	 	117	 
	Section 8.3 Exculpatory Provisions
	 	 	117	 
	Section 8.4 Reliance by Administrative Agent
	 	 	118	 
	Section 8.5 Notice of Default
	 	 	119	 
	Section 8.6 Non-Reliance on Administrative Agent and Other Lenders
	 	 	119	 
	Section 8.7 Indemnification
	 	 	119	 
	Section 8.8 Administrative Agent in Its Individual Capacity
	 	 	120	 
	Section 8.9 Successor Administrative Agent
	 	 	120	 
	Section 8.10 Collateral and Guaranty Matters
	 	 	121	 
	 
	 	 	 	 
	ARTICLE IX MISCELLANEOUS
	 	 	121	 
	Section 9.1 Amendments, Waivers and Release of Collateral
	 	 	122	 
	Section 9.2 Notices
	 	 	124	 
	Section 9.3 No Waiver; Cumulative Remedies
	 	 	126	 
	Section 9.4 Survival of Representations and Warranties
	 	 	126	 
	Section 9.5 Payment of Expenses and Taxes; Indemnity
	 	 	126	 
	Section 9.6 Successors and Assigns; Participations; Purchasing Lenders
	 	 	128	 
	Section 9.7 Right of Set-off; Sharing of Payments
	 	 	131	 
	Section 9.8 Table of Contents and Section Headings
	 	 	133	 
	Section 9.9 Counterparts
	 	 	133	 
	Section 9.10 Integration; Effectiveness; Continuing Agreement
	 	 	133	 
	Section 9.11 Severability
	 	 	134	 
	Section 9.12 Governing Law
	 	 	134	 
	Section 9.13 Consent to Jurisdiction and Service of Process
	 	 	135	 
	Section 9.14 Confidentiality
	 	 	135	 
	Section 9.15 Acknowledgments
	 	 	136	 
	Section 9.16 Waivers of Jury Trial; Waiver of Consequential Damages
	 	 	137	 
	Section 9.17 Patriot Act Notice
	 	 	137	 
	 
	 	 	 	 
	ARTICLE X GUARANTY
	 	 	137	 
	Section 10.1 The Guaranty
	 	 	137	 

iii

 

	 	 	 	 	 
	 	 	 	Page
	Section 10.2 Bankruptcy
	 	 	138	 
	Section 10.3 Nature of Liability
	 	 	138	 
	Section 10.4 Independent Obligation
	 	 	139	 
	Section 10.5 Authorization
	 	 	139	 
	Section 10.6 Reliance
	 	 	139	 
	Section 10.7 Waiver
	 	 	139	 
	Section 10.8 Limitation on Enforcement
	 	 	141	 
	Section 10.9 Confirmation of Payment
	 	 	141	 

iv

 

	 	 	 
	Schedules
	 	 
	Schedule 1.1(a)

	 	Account Designation Letter
	Schedule 1.1(b)

	 	Investments
	Schedule 1.1(c)

	 	Liens
	Schedule 1.1(d)

	 	Existing Letters of Credit
	Schedule 1.1(e)

	 	Mortgaged Properties
	Schedule 1.1(f)

	 	Contributed Real Properties
	Schedule 1.1(g)

	 	Litigation
	Schedule 1.1(h)

	 	Discontinued Operations
	Schedule 2.1(b)(i)

	 	Form of Notice of Borrowing
	Schedule 2.1(e)

	 	Form of Revolving Note
	Schedule 2.2(d)

	 	Form of Term Loan Note
	Schedule 2.3(d)

	 	Form of Swingline Note
	Schedule 2.5(j)

	 	Form of Credit-Linked Note
	Schedule 2.11

	 	Form of Notice of Conversion/Extension
	Schedule 3.12

	 	Subsidiaries
	Schedule 3.16

	 	Intellectual Property
	Schedule 3.19(a)

	 	Location of Real Property
	Schedule 3.19(b)

	 	Location of Collateral
	Schedule 3.19(c)

	 	Chief Executive Offices; Jurisdictions of Organization and Qualification
	Schedule 3.22

	 	Labor Matters
	Schedule 3.24

	 	Material Contracts
	Schedule 3.25

	 	Insurance
	Schedule 4.1(b)

	 	Form of Secretary’s Certificate
	Schedule 4.1(g)

	 	Form of Solvency Certificate
	Schedule 4.1(s)

	 	Form of Patriot Act Certificate
	Schedule 5.2(b)

	 	Form of Officer’s Compliance Certificate
	Schedule 5.10

	 	Form of Joinder Agreement
	Schedule 6.1(b)

	 	Indebtedness
	Schedule 9.2

	 	Lenders’ Lending Offices
	Schedule 9.6(c)

	 	Form of Assignment and Assumption

v

 

     AMENDED AND RESTATED CREDIT AGREEMENT, dated as of June 21, 2007, among GENCORP INC., an Ohio
corporation (the “Borrower”), each of those Material Domestic Subsidiaries of the Borrower
identified as a “Guarantor” on the signature pages hereto and such other Material Domestic
Subsidiaries of the Borrower as may from time to time become a party hereto (collectively the
“Guarantors” and individually a “Guarantor”), the several banks and other financial
institutions from time to time parties to this Credit Agreement (collectively the “Lenders”
and individually a “Lender”), and WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking
association, as administrative agent for the Lenders hereunder (in such capacity, the
“Administrative Agent” or the “Agent”).

W I T N E S S E T H:

     WHEREAS, the Borrower, the Guarantors, the Administrative Agent and the existing lenders are
parties to that certain Credit Agreement, dated December 6, 2004 (as amended, supplemented or
otherwise modified prior to the date hereof, the “Existing Credit Agreement”); and

     WHEREAS, the Borrower and the Guarantors desire to amend the Existing Credit Agreement as set
forth herein and to restate the Existing Credit Agreement in its entirety to read as follows; and

     WHEREAS, the Borrower has requested that the Lenders make loans and other financial
accommodations to the Borrower in the amount of up to $280,000,000, as more particularly described
herein; and

     WHEREAS, the Lenders have agreed to make such loans and other financial accommodations to the
Borrower on the terms and conditions contained herein.

     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged by the parties hereto, such parties hereby agree as follows:

ARTICLE I

DEFINITIONS

     Section 1.1 Defined Terms.

     As used in this Credit Agreement, terms defined in the preamble to this Credit Agreement have
the meanings therein indicated, and the following terms have the following meanings:

     “9.50% Senior Subordinated Notes” shall mean, collectively, those certain 9.50%
unsecured senior subordinated notes due 2013 issued by the Borrower, as the same may be

 

 

amended, restated, supplemented or otherwise modified from time to time as permitted hereunder.

     “4.00% Convertible Notes” shall mean, collectively, those certain 4.00% unsecured
convertible subordinated notes due January 2024 issued by the Borrower, as the same may be amended,
restated, supplemented or otherwise modified from time to time as permitted hereunder.

     “2.25% Convertible Notes” shall mean, collectively, those certain 2.25% unsecured
convertible subordinated notes due November 2024 issued by the Borrower, as the same may be
amended, restated, supplemented or otherwise modified from time to time as permitted hereunder.

     “ABR Default Rate” shall mean, as of any date of determination, the Alternate Base
Rate plus the Applicable Percentage with respect to Alternate Base Rate Loans on such date
plus 2%.

     “Account Designation Letter” shall mean the Notice of Account Designation Letter dated
the Closing Date from the Borrower to the Administrative Agent in substantially the form attached
hereto as Schedule 1.1(a).

     “Additional Credit Party” shall mean each Person that becomes a Guarantor by execution
of a Joinder Agreement or other guaranty agreement in accordance with Section 5.10.

     “Administrative Agent” or “Agent” shall have the meaning set forth in the
first paragraph of this Credit Agreement and any successors in such capacity.

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

     “Aerojet” means Aerojet — General Corporation, an Ohio corporation.

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

     “Agreement” or “Credit Agreement” shall mean this Amended and Restated Credit
Agreement, as amended, restated, amended and restated, modified, supplemented, extended, replaced
or increased from time to time in accordance with its terms.

     “Alternate Base Rate” shall mean, for any day, a rate per annum equal to the greater
of (a) the Prime Rate in effect on such day and (b) the Federal Funds Effective Rate in effect on
such day plus 1/2 of 1%. For purposes hereof: “Prime Rate” shall mean, at any time, the
rate of interest per annum publicly announced or otherwise identified from time to time by Wachovia
at its principal office in Charlotte, North Carolina as its prime rate. The parties hereto
acknowledge that the rate announced publicly by Wachovia as its Prime Rate is an index or base rate
and shall not necessarily be its lowest or best rate charged to its customers or other banks; and
“Federal 

2

 

Funds Effective Rate” shall mean, 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 on the next succeeding Business Day, the average of the
quotations for the day of such transactions received by the Administrative Agent from three federal
funds brokers of recognized standing selected by it. If for any reason the Administrative Agent
shall have determined (which determination shall be conclusive in the absence of manifest error)
that it is unable to ascertain the Federal Funds Effective Rate, for any reason, including the
inability or failure of the Administrative Agent to obtain sufficient quotations in accordance with
the terms thereof, the Alternate Base Rate shall be determined without regard to clause (b) of the
first sentence of this definition, as appropriate, until the circumstances giving rise to such
inability no longer exist. Any change in the Alternate Base Rate due to a change in the Prime Rate
or the Federal Funds Effective Rate shall be effective on the opening of business on the date of
such change.

     “Alternate Base Rate Loans” shall mean Loans that bear interest at an interest rate
based on the Alternate Base Rate.

     “Applicable Percentage” shall mean, for any day, the rate per annum set forth below
opposite the applicable Level then in effect, it being understood that the Applicable Percentage
for (a) the Commitment Fee shall be the percentage set forth under the column titled “Commitment
Fee”, (b) Revolving Loans and Term Loans that are Alternate Base Rate Loans shall be the percentage
set forth under the column titled “Base Rate Margin” as applicable, (c) Revolving Loans and Term
Loans that are LIBOR Rate Loans shall be the percentage set forth under the column titled “LIBOR
Margin” as applicable and (d) the Revolving LOC Commitment Fee shall be the percentage set forth
under the column titled “LIBOR Margin” and “Revolving Loans and Revolving LOC Commitment Fee”:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	LIBOR Margin	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Revolving Loans and	 	 	 	 	 	 	Base Rate Margin	 
	 	 	 	 	 	 	Commitment	 	 	Revolving LOC	 	 	Term	 	 	Revolving	 	 	 	 
	Level	 	Leverage Ratio	 	Fee	 	 	Commitment Fee	 	 	Loans	 	 	Loans	 	 	Term Loans	 
	I
	 	> 4.00 to 1.0	 	 	0.50	%	 	 	2.25	%	 	 	2.25	%	 	 	1.25	%	 	 	1.25	%
	II
	 	< 4.00 to 1.0 but >	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 3.50 to 1.0	 	 	0.375	%	 	 	2.00	%	 	 	2.25	%	 	 	1.00	%	 	 	1.25	%
	III
	 	< 3.50 to 1.0 but >	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	3.00 to 1.0	 	 	0.375	%	 	 	1.75	%	 	 	2.25	%	 	 	0.75	%	 	 	1.25	%
	IV
	 	< 3.00 to 1.0	 	 	0.30	%	 	 	1.50	%	 	 	2.25	%	 	 	0.50	%	 	 	1.25	%

     The Applicable Percentage shall, in each case, be determined and adjusted quarterly on
the date five (5) Business Days after the date on which the Administrative Agent has received from
the Credit Parties the quarterly financial information (in the case of the first three fiscal

3

 

quarters of the Borrower), the annual financial information (in the case of the fourth fiscal
quarter of the Borrower) and the certifications required to be delivered to the Administrative
Agent and the Lenders in accordance with the provisions of Sections 5.1(a), 5.1(b) and 5.2(b) (each
an “Interest Determination Date”). Such Applicable Percentage shall be effective from such
Interest Determination Date until the next such Interest Determination Date. After the Closing
Date, if the Credit Parties shall fail to provide any of the financial information or
certifications in accordance with the provisions of Sections 5.1(a), 5.1(b) and 5.2(b), in addition
to the default rate of interest that may be charged pursuant to Section 2.10(b), the Applicable
Percentage shall, on the date five (5) Business Days after the date by which the Credit Parties
were so required to provide such financial information or certifications to the Administrative
Agent and the Lenders, be based on Level I until such time as such information or certifications
are provided, whereupon the Level shall be determined by the then current Leverage Ratio.
Notwithstanding the foregoing, the Applicable Percentage shall be at Level I above for the first
two fiscal quarters ending after the Closing Date. In the event that any financial statement or
certification delivered pursuant to Section 5.1 is shown to be inaccurate (regardless of whether
this Agreement or the Commitments are in effect when such inaccuracy is discovered), and such
inaccuracy, if corrected, would have led to the application of a higher Applicable Percentage for
any period (an “Applicable Period”) than the Applicable Percentage applied for such
Applicable Period, then the Borrower shall immediately (i) deliver to the Administrative Agent a
corrected compliance certificate for such Applicable Period, (ii) determine the Applicable
Percentage for such Applicable Period based upon the corrected compliance certificate, and (iii)
immediately pay to the Administrative Agent the accrued additional interest owing as a result of
such increased Applicable Percentage for such Applicable Period, which payment shall be promptly
applied by the Administrative Agent in accordance with Section 2.13. It is acknowledged and agreed
that nothing contained herein shall limit the rights of the Administrative Agent and the Lenders
under the Credit Documents, including their rights under Sections 2.10 and 7.1 and other of their
respective rights under this Agreement.

     “Appraised Value” shall mean, with respect to any real property of a Credit Party, the
appraised value of such real property set forth in the most recent appraisal with respect to such
real property that is prepared by an appraiser reasonably acceptable to, and delivered to, the
Administrative Agent (including any new appraisal required by the Administrative Agent in its
reasonable discretion to determine compliance with the Loan to Value Test); provided that
the methodology used in such appraisal in determining the appraised value shall be reasonably
acceptable to the Administrative Agent.

     “Approved Fund” shall mean, with respect to any Lender or other Person who invests in
commercial bank loans in the ordinary course, any other fund or trust or entity that invests in
commercial bank loans in the ordinary course and is advised or managed by such Lender, by an
Affiliate of such Lender or other Persons or the same investment advisor as such Lender or by an
Affiliate of such Lender or investment advisor.

     “Arrangers” shall mean Wachovia Capital Markets, LLC and J.P. Morgan Securities Inc.,
together with their respective successors and assigns.

     “Asset Disposition” shall mean the disposition of any or all of the assets (including,
without limitation, the Capital Stock of a Subsidiary or any ownership interest in a Joint Venture)

4

 

of the Borrower or any Subsidiary (other than a Permitted Real Estate Entity), whether by sale,
lease, transfer or otherwise. The term “Asset Disposition” shall not include (i) the sale, lease
or transfer of assets permitted by subsections 6.4(a)(i) through (xiii), or (ii) any Equity
Issuance.

     “Assignment and Assumption” shall mean an assignment and assumption entered into by a
Lender and an Eligible Assignee (with the consent of any party whose consent is required by the
definition of Eligible Assignee and Section 9.6), and accepted by the Administrative Agent, in
substantially the form of Schedule 9.6(c) or any other form approved by the Administrative
Agent.

     “Bankruptcy Code” shall mean the Bankruptcy Code in Title 11 of the United States
Code, as amended, modified, succeeded or replaced from time to time.

     “Bankruptcy Event” shall mean any of the events described in Section 7.1(f), after
giving effect to any cure period described therein.

     “Borrower” shall have the meaning set forth in the first paragraph of this Credit
Agreement.

     “Borrowing Date” shall mean, in respect of any Loan, the date such Loan is made.

     “Business” shall have the meaning set forth in Section 3.10.

     “Business Day” shall mean a day other than a Saturday, Sunday or other day on which
commercial banks in Charlotte, North Carolina or New York, New York are authorized or required by
law to close; provided, however, that when used in connection with a rate
determination, borrowing or payment in respect of a LIBOR Rate Loan, the term “Business Day” shall
also exclude any day on which banks in London, England are not open for dealings in Dollar deposits
in the London interbank market.

     “Capital Lease” shall mean any lease of property, real or personal, the obligations
with respect to which are required to be capitalized on a balance sheet of the lessee in accordance
with GAAP.

     “Capital Lease Obligations” shall mean the capitalized lease obligations relating to a
Capital Lease determined in accordance with GAAP.

     “Capital Stock” shall mean (a) in the case of a corporation, capital stock, (b) in the
case of an association or business entity, any and all shares, interests, participations, rights or
other equivalents (however designated) of capital stock, (c) in the case of a partnership,
partnership interests (whether general or limited), (d) in the case of a limited liability company,
membership interests and (e) any other interest or participation that confers on a Person the right
to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.

     “Cash Equivalents” shall mean (a) securities issued or directly and fully guaranteed
or insured by the United States of America or any agency or instrumentality thereof (provided that

5

 

the full faith and credit of the United States of America is pledged in support thereof) having
maturities of not more than twelve (12) months from the date of acquisition (“Government
Obligations”), (b) Dollar denominated (or foreign currency fully hedged to the Dollar) time
deposits, certificates of deposit, Eurodollar time deposits and Eurodollar certificates of deposit
of (i) any domestic commercial bank of recognized standing having capital and surplus in excess of
$250,000,000 or (ii) any bank whose short-term commercial paper rating from S&P is at least A-1 or
the equivalent thereof or from Moody’s is at least P-1 or the equivalent thereof (any such bank
being an “Approved Bank”), in each case with maturities of not more than 364 days from the
date of acquisition, (c) commercial paper and variable or fixed rate notes issued by any Approved
Bank (or by the parent company thereof) or any variable rate notes issued by, or guaranteed by any
domestic corporation rated A-1 (or the equivalent thereof) or better by S&P or P-1 (or the
equivalent thereof) or better by Moody’s and maturing within six (6) months of the date of
acquisition, (d) repurchase agreements with a bank or trust company (including a Lender) or a
recognized securities dealer having capital and surplus in excess of $500,000,000 for direct
obligations issued by or fully guaranteed by the United States of America, (e) obligations of any
State of the United States or any political subdivision thereof for the payment of the principal
and redemption price of and interest on which there shall have been irrevocably deposited
Government Obligations maturing as to principal and interest at times and in amounts sufficient to
provide such payment, (f) auction preferred stock rated in the highest short-term credit rating
category by S&P or Moody’s and (g) Investments in money market and tax-exempt mutual funds that (i)
comply with SEC Regulation 2a-7 and (ii) invest substantially all their assets in securities of the
types described in clauses (a) through (f) above.

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

     “Change of Control” shall mean at any time the occurrence of one or more of the
following events: (a) any “person” or “group” (as such terms are used in Section 13(d) and 14(d)
of the Exchange Act), is or becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5
under the Exchange Act, except that a person shall be deemed to have “beneficial ownership” of all
securities that such person has the right to acquire, whether such right is exercisable immediately
or only after the passage of time), directly or indirectly, of 30% or more of the then outstanding
Voting Securities of the Borrower; or (b) the replacement of a majority of the Board of Directors
of the Borrower over a two-year period from the directors who constituted the Board of Directors at
the beginning of such period, and such replacement shall not have been approved by a vote of at
least a majority of the Board of Directors of the Borrower then still in office who either were
members of such Board of Directors at the beginning of such period or whose election as a member of
such Board of Directors was previously so approved.

     “Closing Date” shall mean the date of this Credit Agreement.

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

6

 

     “Collateral” shall mean a collective reference to the collateral which is identified
in, and at any time will be covered by, the Security Documents and any other collateral that may
from time to time secure the Credit Party Obligations.

     “Commitment” shall mean the Revolving Commitment, the Revolving LOC Commitment, the
Swingline Commitment and the Credit-Linked Commitment, individually or collectively, as
appropriate.

     “Commitment Percentage” shall mean the Revolving Commitment Percentage and/or the
Credit-Linked Commitment Percentage, as appropriate.

     “Commonly Controlled Entity” shall mean an entity, whether or not incorporated, which
is under common control with the Borrower, a Subsidiary or a Permitted Real Estate Entity within
the meaning of Section 4001 of ERISA or is part of a group which includes the Borrower, a
Subsidiary or a Permitted Real Estate Entity and which is treated as a single employer under
Section 414 of the Code.

     “Consolidated” shall mean, when used with reference to financial statements or
financial statement items of the Borrower and its Subsidiaries or any other Person, such statements
or items on a consolidated basis in accordance with the consolidation principles of GAAP;
provided, however, with respect to financial statement items of any Permitted Real
Estate Entity that is a Guarantor that is not consolidated with the Borrower for purposes of the
Borrower’s financial statements, only the Borrower’s direct or indirect percentage ownership
interest in such financial statement items of such Permitted Real Estate Entity or Person shall be
included. For the avoidance of doubt, financial statement items of any Permitted Real Estate
Entity that is not a Guarantor shall not be included in the Borrower’s Consolidated financial
statements.

     “Consolidated EBITDAP” shall mean, as of any date of determination for the four
quarter period ending on such date and without duplication,

     (a) the net income or net loss (excluding (i) extraordinary losses and gains, (ii)
gains or losses from any sale of a division or line of business, (iii) all Non-Cash and
Other Adjustments and (iv) all expenses reflected as a restructuring item, an unusual item,
or the cumulative effect of a change in accounting principle in the public financial
statements of the Borrower) of the Borrower and its Subsidiaries on a Consolidated basis for
such period (the “Consolidated Net Income”), plus

     (b) the sum of the following (without duplication) to the extent deducted in
calculating Consolidated Net Income:

     (i) Consolidated Interest Expense for such period;

     (ii) tax expense (including, without limitation, any federal, state, local and
foreign income (or equivalent) taxes) of the Borrower and its Subsidiaries for such
period;

7

 

     (iii) depreciation and amortization for such period;

     (iv) non-cash pension plan expenses for such period;

     (v) non-cash expenses related to contributions by the Borrower or any
Subsidiary to 401(k) employee retirement plans and non-cash expenses related to
Capital Stock grants by the Borrower or any Subsidiary to officers and employees of
the Borrower and its Subsidiaries;

     (vi) (i) financing fees and expenses paid or accrued in connection with the
Transactions or any other debt or equity issuance during such period and (ii)
charges associated with any unamortized fees and expenses associated with prior
financings now affected by the Transactions or any other debt or equity issuance;
and

     (vii) charges related to legal matters involving the Credit Parties and their
respective Subsidiaries with respect to pending or threatened litigation described
on Schedule 1.1(g) in an amount not to exceed $30,000,000, minus

     (c) the following (without duplication): (i) cash charges described in Non-Cash and
Other Adjustments to the extent such cash charges were added back to Consolidated Net Income
in calculating Consolidated EBITDAP for a prior period after the Closing Date, (ii) cash
contributions to pension plans during such period to the extent not already included in the
calculation of Consolidated Net Income and (iii) non-cash pension plan income for
such period.

Further, (1) for any four-quarter period, Consolidated EBITDAP shall be calculated on a pro
forma basis to exclude the effects of any operations or line of business discontinued as of
the Closing Date and as described on Schedule 1.1(h) and (2) for any four-quarter
period ending on or after the closing date of any Permitted Acquisition, Consolidated
EBITDAP shall be calculated on a pro forma basis assuming the consummation of such Permitted
Acquisition as of the first day of such period.

     “Consolidated Funded Debt” shall mean, on any date of calculation, Funded Debt of the
Borrower and its Subsidiaries on a Consolidated basis.

     “Consolidated Interest Expense” shall mean, as of any date of determination for the
four quarter period ending on such date, all interest expense (excluding amortization of debt
discount and premium, but including the interest component under Capital Leases) for such period of
the Borrower and its Subsidiaries on a Consolidated basis. Notwithstanding the foregoing, for
purposes of calculating Consolidated Interest Expense for the fiscal quarters ending August 31,
2007, November 30, 2007 and February 29, 2008, Consolidated Interest Expense shall be annualized
during such fiscal quarters such that (i) for the calculation of Consolidated Interest
Expense as of August 31, 2007, Consolidated Interest Expense for the fiscal quarter then ending
will be multiplied by four (4), (ii) for the calculation of Consolidated Interest Expense as of
November 30, 2007, Consolidated Interest Expense for the two fiscal quarter period then ending will
be multiplied by two (2) and (iii) for the calculation of Consolidated Interest Expense as of

8

 

February 29, 2008, Consolidated Interest Expense for the three fiscal quarter period then ending
will be multiplied by one and one-third (1 1/3).

     “Consolidated Scheduled Debt Payments” shall mean, as of any date of determination for
the four quarter period ending on such date, the sum of all scheduled payments of principal on
Consolidated Funded Debt for such period (including the principal component of payments due on
Capital Leases during the applicable period ending on such date); it being understood that
scheduled payments of principal on Consolidated Funded Debt shall not include optional prepayments
or the mandatory prepayments required pursuant to Section 2.9. Notwithstanding the foregoing, for
purposes of calculating Consolidated Scheduled Debt Payments for the fiscal quarters ending August
31, 2007, November 30, 2007 and February 29, 2008, Consolidated Scheduled Debt Payments shall be
annualized during such fiscal quarters such that (i) for the calculation of Consolidated Scheduled
Debt Payments as of August 31, 2007, Consolidated Scheduled Debt Payments for the fiscal quarter
then ending will be multiplied by four (4), (ii) for the calculation of Consolidated Scheduled Debt
Payments as of November 30, 2007, Consolidated Scheduled Debt Payments for the two fiscal quarter
period then ending will be multiplied by two (2) and (iii) for the calculation of Consolidated
Scheduled Debt Payments as of February 29, 2008, Consolidated Scheduled Debt Payments for the three
fiscal quarter period then ending will be multiplied by one and one-third (1 1/3).

     “Consolidated Total Assets” shall mean, with respect to any Person, the book value,
determined on a consolidated basis in accordance with GAAP, of all assets of such Person and its
Subsidiaries.

     “Consolidated Working Capital” shall mean, as of any date of determination, the excess
of (a) current assets (excluding cash and Cash Equivalents) of the Borrower and its Subsidiaries on
a Consolidated basis at such time less (b) current liabilities (excluding current maturities of
long term debt) of the Borrower and its Subsidiaries on a Consolidated basis at such time, all as
determined in accordance with GAAP.

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

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

     “Copyright Act” shall have the meaning set forth in Section 3.16.

     “Copyright Licenses” shall mean any agreement, whether written or oral, providing for
the grant by or to a Person of any right under any Copyright, including, without limitation, any
thereof referred to in Schedule 3.16 to this Credit Agreement.

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     “Copyrights” shall mean all copyrights of the Credit Parties and their Subsidiaries in
all works, now existing or hereafter created or acquired, all registrations and recordings thereof,
and all applications in connection therewith, whether in the United States Copyright Office or in
any similar office or agency of the United States, any state thereof or any other country or any
political subdivision thereof, or otherwise, including, without limitation, any thereof referred to
in Schedule 3.16 and all renewals thereof.

     “Credit Documents” shall mean this Credit Agreement, each of the Notes, any Joinder
Agreement, the Letters of Credit, the LOC Documents and the Security Documents and all other
agreements, documents, certificates and instruments delivered to the Administrative Agent or any
Lender by any Credit Party in connection therewith (other than any agreement, document, certificate
or instrument related to a Hedging Agreement).

     “Credit-Linked Account” shall mean the account established and maintained by the
Administrative Agent in its name and under its sole dominion and control, designated as the
“Wachovia Bank, National Association, as Administrative Agent—GenCorp. Inc. Credit Linked Account”
that shall be used solely for the purposes set forth in Sections 2.6(b).

     “Credit-Linked Commitment” shall mean, with respect to each Credit-Linked Lender, the
sum of such Credit-Linked Lender’s Credit-Linked LOC Commitment and Term Loan Commitment.

     “Credit-Linked Commitment Percentage” shall mean, for each Credit-Linked Lender, the
percentage identified as its Credit-Linked Commitment Percentage in its Lender Commitment Letter or
in the Register, as such percentage may be modified in connection with any assignment made in
accordance with the provisions of Section 9.6(c).

     “Credit-Linked Commitment Period” shall mean, with respect to Credit-Linked Letters of
Credit, the period from and including the Closing Date to but excluding the date that is ten (10)
days prior to the Credit-Linked Maturity Date.

     “Credit-Linked Committed Amount” shall mean the Term Loan Committed Amount
plus the Credit-Linked LOC Committed Amount.

     “Credit-Linked Deposit” shall mean, with respect to any Credit-Linked Lender, such
Credit-Linked Lender’s funded Credit-Linked Participation in the Credit-Linked LOC Committed Amount
and all Credit-Linked Letters of Credit issued thereunder, which funded Credit-Linked Participation
shall be in an amount equal to such Credit-Linked Lender’s Credit-Linked LOC Commitment and shall
be deposited into the Credit-Linked Account on the Closing Date (or on the date such Person becomes
a Credit-Linked Lender) in accordance with the terms of Section 2.6(a).

     “Credit-Linked Interest” shall have the meaning set forth in Section 2.5(k).

     “Credit-Linked Issuing Lender” shall mean, with respect to any Credit-Linked Letter of
Credit, the Administrative Agent or such other Lender as requested by the Borrower and

10

 

approved by the Administrative Agent, or any other Person that was the Administrative Agent or a Lender at the
time it issued such Credit-Linked Letter of Credit but has ceased to be the Administrative Agent or
a Lender under this Credit Agreement.

     “Credit-Linked Lenders” shall mean, as of any date of determination, the Lenders that
hold a Credit-Linked Commitment on such date.

     “Credit-Linked Letters of Credit” shall mean (a) any letter of credit issued by the
Credit-Linked Issuing Lender from and after the Closing Date pursuant to Section 2.5(a), and (b)
any Existing Letter of Credit, in each case as such letter of credit may be amended, modified,
extended, renewed or replaced from time to time.

     “Credit-Linked LOC Commitment” shall mean the commitment of the Credit-Linked Issuing
Lender to issue Credit-Linked Letters of Credit and with respect to each Credit-Linked Lender, the
commitment of such Credit-Linked Lender to purchase its Credit-Linked Participation in the
Credit-Linked Letters of Credit up to such Credit-Linked Lender’s Credit-Linked Commitment
Percentage of the Credit-Linked LOC Committed Amount as specified in its Lender Commitment Letter
or in the Register, as such amount may be reduced from time to time in accordance with the
provisions hereof.

     “Credit-Linked LOC Committed Amount” shall have the meaning set forth in Section
2.5(a).

     “Credit-Linked LOC Fronting Fee” shall have the meaning set forth in Section 2.7(c).

     “Credit-Linked LOC Obligations” shall mean, at any time, the sum of (i) the maximum
amount which is, or at any time thereafter may become, available to be drawn under Credit-Linked
Letters of Credit then outstanding, assuming compliance with all requirements for drawings referred
to in such Credit-Linked Letters of Credit plus (ii) the aggregate amount of all drawings
under Credit-Linked Letters of Credit honored by the Credit-Linked Issuing Lender but not
theretofore reimbursed.

     “Credit-Linked Maturity Date” shall mean April 30, 2013.

     “Credit-Linked Note” shall mean the promissory notes of the Borrower in favor of each
Credit-Linked Issuing Lender evidencing the Borrower’s obligation to reimburse such Credit-Linked
Issuing Lender for draws under Credit-Linked Letters of Credit provided by such Credit-Linked
Issuing Lender pursuant to Section 2.5, as such promissory note may be amended, modified, restated,
amended and restated, supplemented, extended, renewed or replaced from time to time.

     “Credit-Linked Participation” shall have the meaning set forth in Section 2.5(c).

     “Credit-Linked Purchase” shall have the meaning set forth in Section 2.5(d).

     “Credit Party” shall mean any of the Borrower or the Guarantors.

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     “Credit Party Obligations” shall mean, without duplication, (a) all of the
obligations, indebtedness and liabilities of the Credit Parties to the Lenders (including the
Issuing Lenders) and the Administrative Agent, whenever arising, under this Credit Agreement, the
Notes or any of the other Credit Documents, including principal, interest, fees, reimbursements and
indemnification obligations and other amounts (including, but not limited to, any interest accruing
after the occurrence of a filing of a petition of bankruptcy under the Bankruptcy Code with respect
to any Credit Party, regardless of whether such interest is an allowed claim under the Bankruptcy
Code) and (b) solely for purposes of the Security Documents and the Guaranty, all liabilities and
obligations, whenever arising, owing from any Credit Party or any of their Subsidiaries to any
Hedging Agreement Provider arising under any Secured Hedging Agreement.

     “Customary Permitted Liens” shall mean:

     (a) Liens for taxes not yet due and payable or which are being contested in good faith by
appropriate proceedings diligently pursued; provided that (i) any proceedings commenced for
the enforcement of such Liens shall have been stayed or suspended within 30 days of the
commencement thereof and (ii) provision for the payment of all such taxes known to such Person has
been made on the books of such Person to the extent required by GAAP;

     (b) mechanic’s, processor’s, materialman’s, carrier’s, warehousemen’s, landlord’s and similar
Liens (including statutory and common law landlord’s liens under leases to which any Credit Party
or any Subsidiary is a party) arising by operation of law and arising in the ordinary course of
business and securing obligations of such Person that are not overdue for a period of more than
ninety (90) days or are being contested in good faith by appropriate proceedings diligently
pursued; provided that (i) any proceedings commenced for the enforcement of such Liens
shall have been stayed or suspended within thirty (30) days of the commencement thereof and (ii)
provision for the payment of such Liens has been made on the books of such Person to the extent
required by GAAP;

     (c) Liens arising in connection with worker’s compensation, unemployment insurance, old age
pensions and social security benefits which are not overdue or are being contested in good faith by
appropriate proceedings diligently pursued; provided that (i) any proceedings commenced for
the enforcement of such Liens shall have been stayed or suspended within 30 days of the
commencement thereof and (ii) provision for the payment of such Liens has been made on the books of
such Person to the extent required by GAAP;

     (d) Liens (i) incurred or deposits made in the ordinary course of business to secure the
performance of bids, tenders, statutory obligations, fee and expense arrangements with trustees and
fiscal agents (exclusive of obligations incurred in connection with the borrowing of money or the
payment of the deferred purchase price of property) and customary deposits granted in the ordinary
course of business under operating leases and (ii) securing surety,
indemnity, performance, appeal and release bonds; provided that (A) full provision for
the payment of all such obligations has been made on the books of such Person to the extent
required by GAAP and (B) the aggregate amount of all such obligations does not exceed $1,000,000 at
any time outstanding;

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     (e) Permitted Real Property Encumbrances;

     (f) attachment, judgment or other similar Liens arising in connection with court or
arbitration proceedings involving individually and in the aggregate liability of $1,000,000 or less
at any one time; provided the same are discharged, or that execution or enforcement thereof
is stayed pending appeal, within thirty (30) days or, in the case of any stay of execution or
enforcement pending appeal, within such lesser time during which such appeal may be taken;

     (g) leases or subleases granted to others not interfering in any material respect with the
business of the Borrower or any of its Subsidiaries and any interest or title of a lessor under any
lease permitted by this Credit Agreement or the Security Documents;

     (h) customary rights of set off, revocation, refund or chargeback under deposit agreements or
under the UCC of banks or other financial institutions where the Borrower or any of its
Subsidiaries maintains deposits in the ordinary course of business permitted by this Credit
Agreement;

     (i) landlord’s Liens arising by contract in the ordinary course of business and secured by
assets at the applicable leased property in an amount not to exceed $500,000 in the aggregate; and

     (j) Environmental Liens, to the extent that (i) any proceedings commenced for the enforcement
of such Liens shall have been suspended or are being contested in good faith, (ii) provision for
all liability and damages that are the subject of said Environmental Liens has been made on the
books of such Person to the extent required by GAAP and (iii) such Liens do not relate to
obligations exceeding $5,000,000 in the aggregate at any one time.

     “Debt Issuance” shall mean the issuance of any Indebtedness by the Credit Parties or
any of their Subsidiaries (other than a Permitted Real Estate Entity), but excluding any Equity
Issuance or any Indebtedness of the Credit Parties and their Subsidiaries permitted to be incurred
pursuant to Section 6.1 hereof (other than Section 6.1(j)).

     “Default” shall mean any of the events specified in Section 7.1, whether or not any
requirement for the giving of notice or the lapse of time, or both, or any other condition, has
been satisfied.

     “Defaulting Lender” shall mean, at any time, any Lender that at such time (a) has
failed to make a Loan or fund its portion of the Credit-Linked Deposit required pursuant to the
terms of this Credit Agreement, including the funding of a Revolving Participation Interest or a
Credit-Linked Participation in accordance with the terms hereof and such default remains uncured,
(b) has failed to pay to the Administrative Agent or any Lender an amount owed by such Lender
pursuant to the terms of this Credit Agreement and such default remains uncured, or (c) has been
deemed insolvent or has become subject to a bankruptcy or insolvency proceeding or to a receiver,
trustee or similar official.

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     “Dollars” and “$” shall mean dollars in lawful currency of the United States
of America.

     “Domestic Lending Office” shall mean, initially, the office of each Lender designated
as such Lender’s Domestic Lending Office shown in such Lender’s Administrative Questionnaire; and
thereafter, such other office of such Lender as such Lender may from time to time specify to the
Administrative Agent and the Borrower as the office of such Lender at which Alternate Base Rate
Loans of such Lender are to be made.

     “Domestic Subsidiary” shall mean any Subsidiary that is organized and existing under
the laws of the United States or any state or commonwealth thereof or under the laws of the
District of Columbia.

     “Eligible Assignee” shall mean (a) a Lender, (b) an Affiliate of a Lender, (c) an
Approved Fund, and (d) any other Person (other than a natural person) approved by (i) the
Administrative Agent, (ii) in the case of any assignment of a Revolving Commitment, the Issuing
Lender, and (iii) unless a Default or an Event of Default has occurred and is continuing and so
long as the primary syndication of the Loans has been completed as determined by Wachovia, the
Borrower (each such approval not to be unreasonably withheld or delayed); provided that
notwithstanding the foregoing, “Eligible Assignee” shall not include the Borrower or any of the
Borrower’s Affiliates or Subsidiaries.

     “Environmental Laws” shall mean any and all applicable foreign, federal, state, local
or municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees, requirements
of any Governmental Authority or other Requirement 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 be in effect during the term of this Credit Agreement.

     “Environmental Lien” shall mean a Lien in favor of any Governmental Authority for (a)
any liability under Environmental Laws, or any limitations or restrictions placed upon any real
property owned, leased or operated by the Borrower or any of its Subsidiaries by any Government
Authority or court, or (b) damages relating to, or costs incurred by such Governmental Authority in
response to, a release or threatened release of Materials of Environmental Concern into the
environment.

     “Equity Issuance” shall mean any issuance by any Credit Party or any Subsidiary (other
than a Permitted Real Estate Entity) to any Person which is not a Credit Party of (a) shares of its
Capital Stock (including, without limitation, any issuance of shares of its Capital Stock pursuant
to the exercise of options or warrants or pursuant to the conversion of any debt securities to
equity) or (b) warrants or options that are exercisable for shares of its Capital Stock. The term
“Equity Issuance” shall not include (i) any Asset Disposition, (ii) any Debt Issuance, (iii) any
equity issuance as consideration for a Permitted Acquisition, (iv) any equity issuance of a
Permitted Real Estate Entity, (v) any equity issuance the proceeds of which are used to refinance
the Existing Subordinated Notes as permitted by Section 6.10(c) or (vi) any stock grants to, or
exercise of stock options by, current and former employees or directors.

14

 

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

     “Eurodollar Reserve Percentage” shall mean for any day, the percentage (expressed as a
decimal and rounded upwards, if necessary, to the next higher 1/100th of 1%) which is in effect for
such day as prescribed by the Federal Reserve Board (or any successor) for determining the maximum
reserve requirement (including without limitation any basic, supplemental or emergency reserves) in
respect of Eurocurrency liabilities, as defined in Regulation D of such Board as in effect from
time to time, or any similar category of liabilities for a member bank of the Federal Reserve
System in New York City.

     “Event of Default” shall mean any of the events specified in Section 7.1;
provided, however, that any requirement for the giving of notice or the lapse of
time, or both, or any other condition, has been satisfied.

     “Excess Cash Flow” shall mean, with respect to any fiscal year period of the Borrower
and its Subsidiaries on a Consolidated basis, an amount equal to (without duplication) (a) cash
flow of the Borrower and its Subsidiaries (other than Permitted Real Estate Entities) provided by
or used in operating activities (as set forth in the Borrower’s audited financial statements for
such fiscal year) minus (b) consolidated capital expenditures made by the Borrower and its
Subsidiaries (other than a Permitted Real Estate Entity) during such period minus (c)
Consolidated Scheduled Debt Payments made during such period minus (d) the sum of all
optional prepayments and mandatory prepayments (to the extent the proceeds of such mandatory
prepayment events are included in cash flow from operations) of principal on the Term Loan made
during such period minus (e) the sum of all redemptions and prepayments of principal on the
Existing Subordinated Notes (other than prepayments made with proceeds of Indebtedness) made during
such period to the extent permitted by this Credit Agreement minus (f) any cash expense
incurred in connection with any Permitted Acquisition minus (g) to the extent such proceeds
have been included in the determination of cash flow pursuant to clause (a) above, (i) 50% of the
cash proceeds from Permitted Real Estate Sales during such period and (ii) 100% of the cash
proceeds from the sale of any owned real property of a Permitted Real Estate Entity during such
period (other than any such sale that constitutes a Permitted Real Estate Sale).

     “Excluded Taxes” shall mean, with respect to the Administrative Agent, any Lender, the
Issuing Lender or any other recipient of any payment to be made by or on account of any obligation
of the Borrower hereunder, (a) taxes imposed on or measured by its overall net income (however
denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction
(or any political subdivision thereof) under the laws of which such recipient is organized or in
which its principal office is located or, in the case of any Lender, in which its applicable
lending office is located, (b) any branch profits taxes imposed by the United States of America or
any similar tax imposed by any other jurisdiction in which the Borrower is located and (c) in the
case of a Foreign Lender, any withholding tax that is imposed on amounts payable
to such Foreign Lender at the time such Foreign Lender becomes a party hereto (or
designates a new lending office) or is attributable to such Foreign Lender’s failure or inability (other than as a
result of a Change in Law) to comply with Section 2.19, except to the extent that such Foreign
Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office
(or

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assignment), to receive additional amounts from the Borrower with respect to such withholding
tax pursuant to Section 2.19; provided that any withholding tax imposed on amounts payable
to a Foreign Lender attributable to such Foreign Lender’s inability to qualify for an exemption
from such withholding tax as a result of the structure of the credit-linked facility set forth in
Sections 2.4 and 2.5, the funding of Credit-Linked Participations with respect thereto or the
characterization of any amounts payable to such Foreign Lender with respect thereto shall not
constitute Excluded Taxes.

     “Existing Letters of Credit” shall mean the letters of credit listed on Schedule
1.1(d).

     “Existing Subordinated Notes” shall mean, collectively, the 9.50% Senior Subordinated
Notes, the 2.25% Convertible Notes and the 4.00% Convertible Notes, as the same may be amended,
restated, supplemented or otherwise modified from time to time as permitted hereunder.

     “Extension of Credit” shall mean, as to any Lender, (a) the making of a Loan by such
Lender or (b) the issuance of, or participation in, a Letter of Credit by such Lender.

     “Fair Market Value” shall mean, with respect to any asset or property, the price which
could be negotiated in an arm’s-length free market transaction, for cash, between a willing seller
and a willing buyer, neither of which is under pressure or compulsion to complete the transaction.

     “Federal Funds Effective Rate” shall have the meaning set forth in the definition of
“Alternate Base Rate”.

     “Fee Letter” shall mean one or more fee letter agreements addressed to the Borrower
from the Arrangers and their Affiliates, as amended, modified or otherwise supplemented.

     “Flood Hazard Property” shall have the meaning set forth in Section 4.1(e)(v).

     “Foreign Lender” shall mean any Lender that is organized under the laws of a
jurisdiction other than that in which the Borrower is resident for tax purposes. For purposes of
this definition, the United States of America, each State thereof and the District of Columbia
shall be deemed to constitute a single jurisdiction.

     “Foreign Subsidiary” shall mean any Subsidiary that is not a Domestic Subsidiary.

     “Fund” shall mean any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial loans and similar
extensions of credit in the ordinary course.

     “Funded Debt” shall mean, with respect to any Person, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by
bonds, debentures, notes or similar instruments, or upon which interest payments are customarily
made, (c) the maximum amount of earnout obligations to the extent such earnout obligations appear

16

 

as liabilities on a balance sheet of such Person, (d) the principal portion of all Capital Lease
Obligations of such Person, (e) all preferred Capital Stock issued by such Person and which by the
terms thereof could be (at the request of the holders thereof) subject to mandatory sinking fund
payments, redemption or other acceleration prior to the date that is 91 days after the
Credit-Linked Maturity Date, (f) the principal balance outstanding under any synthetic lease, tax
retention operating lease, off-balance sheet loan or similar off-balance sheet financing product,
(g) all Indebtedness of others of the type described in clauses (a) through (f) hereof secured by
(or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on, or payable out of the proceeds of production from, property owned or
acquired by such Person, whether or not the obligations secured thereby have been assumed, (h) all
Guaranty Obligations of such Person with respect to Indebtedness of another Person of the type
described in clauses (a) through (f) hereof, and (i) all Indebtedness of the type described in
clauses (a) through (f) hereof of any partnership or unincorporated joint venture in which such
Person is a general partner or a joint venturer (to the extent that such Person is liable
therefore) calculated based on the percentage of such Indebtedness for which such Person is liable;
provided, however, that Funded Debt shall not include (i) Indebtedness among the
Credit Parties and (ii) Indebtedness permitted under Section 6.1(i).

     “GAAP” shall mean generally accepted accounting principles in effect in the United
States of America applied on a consistent basis, subject, however, in the case of
determination of compliance with the financial covenants set out in Section 5.9 to the provisions
of Section 1.3.

     “Government Acts” shall have the meaning set forth in Section 2.20.

     “Governmental Approvals” shall mean all authorizations, consents, approvals, permits,
licenses and exemptions of, registrations and filings with, and reports to, all Governmental
Authorities.

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

     “Granite Agreement” shall have the meaning set forth in Section 6.4(a).

     “Guarantor” shall have the meaning set forth in the first paragraph of this Credit
Agreement; provided that to the extent a Permitted Real Estate Entity is not a guarantor
under any of the Existing Subordinated Notes or any other material Indebtedness (at any time prior
to or after the Closing Date) of a Credit Party then, at the Borrower’s election, such Permitted
Real Estate Entity shall not be required to be a Guarantor under this Credit Agreement.

     “Guaranty” shall mean the guaranty of the Guarantors set forth in Article X.

17

 

     “Guaranty Obligations” shall mean, with respect to any Person, without duplication,
any obligations of such Person (other than endorsements in the ordinary course of business of
negotiable instruments for deposit or collection) guaranteeing or intended to guarantee any
Indebtedness of any other Person in any manner, whether direct or indirect, and including without
limitation any obligation, whether or not contingent, (a) to purchase any such Indebtedness or any
property constituting security therefor, (b) to advance or provide funds or other support for the
payment or purchase of any such Indebtedness or to maintain working capital, solvency or other
balance sheet condition of such other Person (including without limitation keep well agreements,
maintenance agreements, comfort letters or similar agreements or arrangements) for the benefit of
any holder of Indebtedness of such other Person, (c) to lease or purchase property, securities or
services primarily for the purpose of assuring the holder of such Indebtedness, or (d) to otherwise
assure or hold harmless the holder of such Indebtedness against loss in respect thereof. The
amount of any Guaranty Obligation hereunder shall (subject to any limitations set forth therein) be
deemed to be an amount equal to the outstanding principal amount (or maximum principal amount, if
larger) of the Indebtedness in respect of which such Guaranty Obligation is made.

     “Hedging Agreement Provider” shall mean any Person that enters into a Secured Hedging
Agreement with a Credit Party or any of its Subsidiaries that is permitted by Section 6.1 to the
extent such Person is a Lender, an Affiliate of a Lender or any other Person that was a Lender (or
an Affiliate of a Lender) at the time it entered into the Secured Hedging Agreement but has ceased
to be a Lender (or whose Affiliate has ceased to be a Lender) under this Credit Agreement.

     “Hedging Agreements” shall mean, with respect to any Person, any agreement entered
into to protect such Person against fluctuations in interest rates, or currency or raw materials
values, including, without limitation, any interest rate swap, cap or collar agreement or similar
arrangement between such Person and one or more counterparties, any foreign currency exchange
agreement, currency protection agreements, commodity purchase or option agreements or other
interest or exchange rate hedging agreements.

     “Incremental Term Loan” shall have the meaning set forth in Section 2.22.

     “Incurrence Test” shall mean, with respect to the incurrence of any Incremental Term
Loan, the requirement that the Senior Secured Leverage Ratio shall be less than 2.25 to 1.0.

     “Indebtedness” shall mean, with respect to any Person, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by
bonds, debentures, notes or similar instruments, or upon which interest payments are customarily
made, (c) all obligations of such Person under conditional sale or other title retention agreements
relating to property purchased by such Person (other than customary reservations or retentions of
title under agreements with suppliers entered into in the ordinary course of business), (d) all
obligations (including, without limitation, the maximum amount of earnout obligations) of such
Person incurred, issued or assumed as the deferred purchase price of property or services purchased
by such Person (other than trade debt incurred in the ordinary course of business and due within
six (6) months of the incurrence thereof) which would appear as liabilities on a balance sheet of
such Person, (e) the principal portion of all Capital Lease Obligations of such Person, (f) the
maximum

18

 

amount of all letters of credit issued or bankers’ acceptances facilities created for the
account of such Person and, without duplication, all drafts drawn thereunder (to the extent
unreimbursed), (g) all preferred Capital Stock issued by such Person and which by the terms thereof
could be (at the request of the holders thereof) subject to mandatory sinking fund payments,
redemption or other acceleration prior to the date that is 91 days after the Credit-Linked Maturity
Date, (h) the principal balance outstanding under any synthetic lease, tax retention operating
lease, off-balance sheet loan or similar off-balance sheet financing product, (i) payment
obligations of such Person under non-compete agreements, (j) all obligations of such Person under
Hedging Agreements, excluding any portion thereof which would be accounted for as interest expense
under GAAP, (k) all obligations of such Person under take-or-pay or similar arrangements or under
commodities agreements, (l) all Indebtedness of others of the type described in clauses (a) through
(k) hereof secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien on, or payable out of the proceeds of
production from, property owned or acquired by such Person, whether or not the obligations secured
thereby have been assumed, (m) all Guaranty Obligations of such Person with respect to Indebtedness
of another Person of the type described in clauses (a) through (k) hereof, and (n) all Indebtedness
of the type described in clauses (a) through (k) hereof of any partnership or unincorporated joint
venture in which such Person is a general partner or a joint venturer (to the extent that such
Person is liable therefore) calculated based on the percentage of such Indebtedness for which such
Person is liable.

     “Indemnified Taxes” shall mean Taxes other than Excluded Taxes.

     “Indemnitee” shall have the meaning set forth in Section 9.5(b).

     “Insolvency” shall mean, with respect to any Multiemployer Plan, the condition that
such Plan is insolvent within the meaning of such term as used in Section 4245 of ERISA.

     “Intellectual Property” shall mean the Copyrights, Copyright Licenses, Patents, Patent
Licenses, Trademarks and Trademark Licenses of the Credit Parties and their Subsidiaries, all
goodwill associated therewith and all rights to sue for infringement thereof.

     “Intercompany Note” means a demand promissory note (or a promissory note payable on a
date reasonably satisfactory to the Administrative Agent) issued by a Subsidiary directly to the
Borrower in form and substance that is satisfactory to the Administrative Agent.

     “Interest Coverage Ratio” shall mean the ratio of (a) Consolidated EBITDAP for such
period to (b) Consolidated Interest Expense net of interest income for such period.

     “Interest Payment Date” shall mean (a) as to any Alternate Base Rate Loan, the last
day of each March, June, September and December and on the applicable Maturity Date, (b) as to any
LIBOR Rate Loan having an Interest Period of three (3) months or less, the last day of such
Interest Period, (c) as to any LIBOR Rate Loan having an Interest Period longer than three (3)
months, (i) each three (3) month anniversary following the first day of such Interest Period and
(ii) the last day of such Interest Period and (d) as to any Loan which is the subject of a
mandatory prepayment required pursuant to Section 2.9(b), the date on which such mandatory
prepayment is due.

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     “Interest Period” shall mean, with respect to any LIBOR Rate Loan,

     (a) initially, the period commencing on the Borrowing Date or conversion date, as the
case may be, with respect to such LIBOR Rate Loan and ending one, two, three, six or twelve
months thereafter, subject to availability to all applicable Lenders, as selected by the
Borrower in the Notice of Borrowing or Notice of Conversion given with respect thereto; and

     (b) thereafter, each period commencing on the last day of the immediately preceding
Interest Period applicable to such LIBOR Rate Loan and ending one, two, three, six or twelve
months thereafter, subject to availability to all applicable Lenders, as selected by the
Borrower by irrevocable notice to the Administrative Agent not less than three Business Days
prior to the last day of the then current Interest Period with respect thereto;
provided that the foregoing provisions are subject to the following:

     (i) if any Interest Period pertaining to a LIBOR Rate Loan 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) any Interest Period pertaining to a LIBOR Rate Loan that begins on the
last Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period) shall
end on the last Business Day of the relevant calendar month;

     (iii) if the Borrower shall fail to give notice as provided above, the Borrower
shall be deemed to have selected an Alternate Base Rate Loan to replace the affected
LIBOR Rate Loan;

     (iv) no Interest Period in respect of any Loan shall extend beyond the
applicable Maturity Date and, further with regard to any Term Loan, no Interest
Period shall extend beyond any principal amortization payment date with respect to
such Term Loan unless the portion of such Term Loan consisting of Alternate Base
Rate Loans together with the portion of such Term Loan consisting of LIBOR Rate
Loans with Interest Periods expiring prior to or concurrently with the date such
principal amortization payment date is due, is at least equal to the amount of such
principal amortization payment due on such date; and

     (v) no more than eight (8) LIBOR Rate Loans may be in effect at any time. For
purposes hereof, LIBOR Rate Loans with different Interest Periods shall be
considered as separate LIBOR Rate Loans, even if they shall begin on the
same date, although borrowings, extensions and conversions may, in accordance with
the provisions hereof, be combined at the end of existing Interest Periods to
constitute a new LIBOR Rate Loan with a single Interest Period.

20

 

     “Investment” shall mean (a) the acquisition (whether for cash, property, services,
assumption of Indebtedness, securities or otherwise) of shares of Capital Stock, other ownership
interests or other securities of any Person or bonds, notes, debentures or all or substantially all
of the assets of any Person or (b) any deposit with, or advance, loan or other extension of credit
to, any Person (other than deposits made in the ordinary course of business) or (c) any other
capital contribution to or investment in any Person, including, without limitation, any Guaranty
Obligation (including any support for a letter of credit issued on behalf of such Person) incurred
for the benefit of such Person.

     “Issuing Lenders” shall mean, as of any date of determination, the Administrative
Agent and any other Credit-Linked Issuing Lender or Revolving Issuing Lender that has issued a
Letter of Credit that is outstanding on such date of determination.

     “Issuing Lender Fees” shall have the meaning set forth in Section 2.7(d).

     “Joinder Agreement” shall mean a Joinder Agreement in substantially the form of
Schedule 5.10, executed and delivered by an Additional Credit Party in accordance with the
provisions of Section 5.10.

     “Joint Venture” means any corporation, partnership, limited liability company, joint
venture or other similar legal arrangement (whether created by contract or conducted through a
separate legal entity) now or hereafter formed by the Borrower or any of its Subsidiaries with
another Person that is not the Borrower or any Subsidiary in order to conduct a common venture or
enterprise with such Person.

     “Lender” shall have the meaning set forth in the first paragraph of this Credit
Agreement and shall include each Issuing Lender.

     “Lender Commitment Letter” shall mean, with respect to any Credit-Linked Lender, the
letter (or other correspondence) to such Credit-Linked Lender from the Administrative Agent
notifying such Credit-Linked Lender of its Credit-Linked LOC Commitment, Credit-Linked Commitment
Percentage and/or Term Loan Commitment Percentage.

     “Letters of Credit” shall mean, collectively, the Revolving Letters of Credit and the
Credit-Linked Letters of Credit.

     “Leverage Ratio” shall mean, as of any date of determination, the ratio of (i)
Consolidated Funded Debt on such date minus, so long as there are no Revolving Loans
outstanding, unrestricted cash, cash equivalents and restricted cash earmarked for the permanent
reduction of Consolidated Funded Debt in an amount not to exceed $100,000,000 held by the Credit
Parties on such date to (ii) Consolidated EBITDAP.

     “LIBOR” shall mean, for any LIBOR Rate Loan for any Interest Period therefor, the rate
per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen
LIBOR01 Page (or any successor page) as the London interbank offered rate for deposits in Dollars

21

 

at approximately 11:00 A.M. (London time) two Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period. If for any reason such rate is not
available, then “LIBOR” shall mean the rate per annum at which, as determined by the Administrative
Agent in accordance with its customary practices, Dollars in an amount comparable to the Loans then
requested are being offered to leading banks at approximately 11:00 A.M. London time, two (2)
Business Days prior to the commencement of the applicable Interest Period for settlement in
immediately available funds by leading banks in the London interbank market for a period equal to
the Interest Period selected.

     “LIBOR Lending Office” shall mean, initially, the office(s) of each Lender designated
as such Lender’s LIBOR Lending Office in such Lender’s Administrative Questionnaire; and
thereafter, such other office of such Lender as such Lender may from time to time specify to the
Administrative Agent and the Borrower as the office of such Lender at which the LIBOR Rate Loans of
such Lender are to be made.

     “LIBOR Rate” shall mean a rate per annum (rounded upwards, if necessary, to the next
higher 1/100th of 1%) determined by the Administrative Agent pursuant to the following formula:

     “LIBOR Rate Loan” shall mean Loans the rate of interest applicable to which is based
on the LIBOR Rate.

     “Lien” shall mean 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, without limitation, any conditional sale or other title retention agreement
and any Capital Lease having substantially the same economic effect as any of the foregoing).

     “Litigation Award” shall mean the receipt by the Borrower or any of its Subsidiaries
(other than a Permitted Real Estate Entity) of cash or Cash Equivalents from any arbitration award,
settlement, court judgment or other award, judgment or settlement received in any
litigation-related proceeding.

     “Loan” shall mean a Revolving Loan, a Swingline Loan and/or a Term Loan, as
appropriate.

     “Loan to Value Test” shall mean, as of any date of determination, the aggregate
principal amount of the outstanding Term Loans plus the Credit-Linked LOC Committed Amount
is less than or equal to the Appraised Value of the Credit Parties’ (other than a Permitted Real
Estate
Entity) owned real property subject to a Lien in favor of the Administrative Agent, for the benefit
of the Lenders.

22

 

     “LOC Documents” shall mean, with respect to any Letter of Credit, such Letter of
Credit, any amendments thereto, any documents delivered in connection therewith, any application
therefor, and any agreements, instruments, guarantees or other documents (whether general in
application or applicable only to such Letter of Credit) governing or providing for (i) the rights
and obligations of the parties concerned or (ii) any collateral security for such obligations.

     “Mandatory LOC Borrowing” shall have the meaning set forth in Section 2.2(e).

     “Mandatory Swingline Borrowing” shall have the meaning set forth in Section
2.3(b)(ii).

     “Material Adverse Effect” shall mean a material adverse effect on (a) the business,
operations, property, assets or financial condition of (i) the Credit Parties taken as a whole,
(ii) the Credit Parties and their Subsidiaries taken as a whole or (iii) the Credit Parties, their
Subsidiaries and the Permitted Real Estate Entities taken as a whole, (b) the ability of the
Borrower or any Guarantor to perform its obligations, when such obligations are required to be
performed, under this Credit Agreement, any of the Notes or any other Credit Document or (c) the
validity or enforceability of this Credit Agreement, any of the Notes or any of the other Credit
Documents or the rights or remedies of the Administrative Agent or the Lenders hereunder or
thereunder.

     “Material Contract” shall mean (a) any contract or other agreement, written or oral,
of the Credit Parties or any of their Subsidiaries representing at least 7.5% of the total
consolidated revenues of the Credit Parties and their Subsidiaries for any fiscal year and (b) any
other contract, agreement, permit or license, written or oral, of the Credit Parties or any of
their Subsidiaries as to which the breach, nonperformance, cancellation or failure to renew in
accordance with the terms thereof by any party thereto, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.

     “Material Domestic Subsidiary” shall mean any Domestic Subsidiary of any Credit Party,
(a) that guarantees any of the Existing Subordinated Notes, any other Subordinated Debt, any senior
notes or any other material Indebtedness of a Credit Party of Subsidiary thereof (including
Aerojet-General Corporation and Aerojet Ordinance Tennessee, Inc. but excluding the other
Subsidiaries listed on Schedule 3.12) or (b) the Consolidated Total Assets of which were
more than 7.5% of the Consolidated Total Assets of the Borrower and its Subsidiaries as of the end
of the most recently completed fiscal year of the Borrower for which audited financial statements
are available; provided that, in the event the aggregate of the Consolidated Total Assets
of all Domestic Subsidiaries that do not constitute Material Domestic Subsidiaries exceeds 7.5% of
the Consolidated Total Assets of the Borrower and its Subsidiaries as of such date, the Borrower
(or the Administrative Agent, in the event the Borrower has failed to do so within ten (10) days of
request therefor by the Administrative Agent) shall, to the extent necessary, designate sufficient
Domestic Subsidiaries to be deemed to be “Material Domestic Subsidiaries” to eliminate such excess,
and such designated Domestic Subsidiaries shall thereafter constitute Material Domestic
Subsidiaries. Assets of Foreign Subsidiaries shall be converted into Dollars at the rates used for
purposes of preparing the consolidated balance sheet of the Borrower included in such audited
financial statements.

23

 

     “Material Foreign Subsidiary” shall mean any Foreign Subsidiary of any Credit Party,
the Consolidated Total Assets of which were more than 7.5% of the Consolidated Total Assets of the
Borrower and its Subsidiaries as of the end of the most recently completed fiscal year of the
Borrower for which audited financial statements are available; provided that, in the event
the aggregate of the Consolidated Total Assets of all Foreign Subsidiaries that do not constitute
Material Foreign Subsidiaries exceeds 7.5% of the Consolidated Total Assets of the Borrower and its
Subsidiaries as of such date, the Borrower (or the Administrative Agent, in the event the Borrower
has failed to do so within ten (10) days of request therefor by the Administrative Agent) shall, to
the extent necessary, designate sufficient Foreign Subsidiaries to be deemed to be “Material
Foreign Subsidiaries” to eliminate such excess, and such designated Foreign Subsidiaries shall
thereafter constitute Material Foreign Subsidiaries. Assets of Foreign Subsidiaries shall be
converted into Dollars at the rates used for purposes of preparing the consolidated balance sheet
of the Borrower included in such audited financial statements.

     “Materials of Environmental Concern” shall mean any gasoline or petroleum (including
crude oil or any fraction thereof) or petroleum products or any hazardous or toxic substances,
materials or wastes, defined or regulated as such in or under any Environmental Law, including,
without limitation, asbestos, polychlorinated biphenyls and urea-formaldehyde insulation.

     “Maturity Date” shall mean the Credit-Linked Maturity Date or the Revolving Commitment
Termination Date, as applicable.

     “Moody’s” shall mean Moody’s Investors Service, Inc.

     “Mortgage Instrument” shall mean any mortgage, deed of trust, deed to secure debt or
assignment of leases and rents executed by a Credit Party in favor of the Administrative Agent
pursuant to the terms of Section 4.1(e)(i), 5.10 or 5.12, as the same may be amended, modified,
restated or supplemented from time to time.

     “Mortgage Policy” shall mean, with respect to any Mortgage Instrument, an ALTA
mortgagee title insurance policy issued by a Title Company in such amount as reasonably approved by
the Administrative Agent, assuring the Administrative Agent that such Mortgage Instrument creates a
valid and enforceable first priority mortgage lien on the applicable Mortgaged Property, free and
clear of all defects and encumbrances except Permitted Liens, which Mortgage Policy shall be in
form and substance reasonably satisfactory to the Administrative Agent and shall provide for
affirmative insurance and such reinsurance as the Administrative Agent may reasonably request.

     “Mortgaged Property” shall mean any owned or leased real property of a Credit Party
with respect to which such Credit Party executes a Mortgage Instrument in favor of the
Administrative Agent, including, without limitation, each real property set forth on Schedule
1.1(e).

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

24

 

     “Net Cash Proceeds” shall mean the aggregate cash proceeds received by any Credit
Party or any Subsidiary (other than a Permitted Real Estate Entity) in respect of any Asset
Disposition, Equity Issuance, Debt Issuance, Recovery Event, Permitted Real Estate Sales, Permitted
Real Estate Transfer or Litigation Award, net of (a) direct costs (including, without limitation,
legal, accounting and investment banking fees, and sales commissions) associated therewith, (b)
amounts held in escrow to be applied as part of the purchase price of any Asset Disposition, (c)
taxes paid or payable as a result thereof, (d) with respect to any Asset Disposition or Recovery
Event, payment of the outstanding principal amount of, premium (if any) and interest on any
Indebtedness secured by a Lien on the assets subject to such Asset Disposition or Recovery Event
and (e) with respect to any Recovery Event or Litigation Award, amounts payable directly or
indirectly to Governmental Authorities for such Recovery Event or Litigation Award to the extent
required by such Governmental Authorities or Contractual Obligations; it being understood that “Net
Cash Proceeds” shall include, without limitation, any cash proceeds from the sale or other
disposition of any non-cash consideration (but only as and when such cash is actually received)
received by any Credit Party or any Subsidiary in any Asset Disposition, Equity Issuance, Debt
Issuance, Recovery Event or Litigation Award and any cash released from escrow as part of the
purchase price in connection with any Asset Disposition.

     “Non-Cash and Other Adjustments” shall mean (i) charges associated with environmental
reserve adjustments and (ii) all non-cash expenses or income incurred outside the normal course of
business of the Credit Parties including litigation settlements and awards and charges associated
with impairments of tangible and intangible assets.

     “Note” or “Notes” shall mean the Revolving Notes, the Swingline Notes, the
Credit-Linked Note and/or the Term Loan Notes, collectively, separately or individually, as
appropriate.

     “Notice of Borrowing” shall mean a request for a Revolving Loan borrowing pursuant to
Section 2.1(b)(i) or a request for a Swingline Loan borrowing pursuant to Section 2.3(b)(i), as
appropriate, in substantially the form of the notice of borrowing attached hereto as Schedule
2.1(b)(i).

     “Notice of Conversion” shall have the meaning set forth in Section 2.11.

     “Obligations” shall mean, collectively, Loans, Revolving LOC Obligations and
Credit-Linked LOC Obligations and all other obligations of the Credit Parties to the Administrative
Agent and the Lenders under the Credit Documents.

     “OFAC” shall mean the U.S. Department of the Treasury’s Office of Foreign Assets
Control.

     “Other Parties” shall have the meaning set forth in Section 10.7(c).

     “Other Taxes” shall mean 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
under any other Credit Document or from the execution, delivery or enforcement of, or otherwise
with respect to, this Agreement or any other Credit Document.

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     “Participant” has the meaning assigned to such term in clause (d) of Section 9.6.

     “Participation Interests” shall mean Revolving Participation Interests or
Credit-Linked Participations, individually or collectively as the context may require.

     “Patent Licenses” shall mean all agreements, whether written or oral, providing for
the grant by or to a Person of any right to manufacture, use or sell any invention covered by a
Patent, including, without limitation, any thereof referred to in Schedule 3.16 to this
Credit Agreement.

     “Patents” shall mean all letters patent of the United States or any other country, now
existing or hereafter arising, and all improvement patents, reissues, reexaminations, patents of
additions, renewals and extensions thereof, including, without limitation, any thereof referred to
in Schedule 3.16 to this Credit Agreement, and (ii) all applications for letters patent of
the United States or any other country, now existing or hereafter arising, and all provisionals,
divisions, continuations and continuations-in-part and substitutes thereof, including, without
limitation, any thereof referred to in Schedule 3.16 to this Credit Agreement.

     “Patriot Act” shall mean The Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Title III of Pub. L.
No. 107-56 (signed into law October 26, 2001)), as amended or modified from time to time.

     “PBGC” shall mean the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA.

     “Performance Based Letters of Credit” shall mean letters of credit backing advanced
deposits or performance based contracts.

     “Permitted Acquisition” shall mean an acquisition or any series of related
acquisitions by a Credit Party of (a) all or substantially all of the assets or a majority of the
outstanding Voting Securities or economic interests of a Person that is incorporated, formed or
organized in the United States or (b) any division, line of business or other business unit of a
Person that is incorporated, formed or organized in the United States (such Person or such
division, line of business or other business unit of such Person shall be referred to herein as the
“Target”), in each case that is a type of business (or assets used in a type of business)
permitted to be engaged in by the Credit Parties and their Subsidiaries pursuant to Section 6.3, so
long as (i) no Default or Event of Default shall then exist or would exist after giving effect
thereto, (ii) the Credit Parties shall demonstrate to the reasonable satisfaction of the
Administrative Agent and the Required Lenders that, after giving effect to the acquisition on a pro
forma basis, the Credit Parties are in compliance with each of the financial covenants set forth in
Section 5.9, (iii) the Administrative Agent, on behalf of the Lenders, shall have received (or
shall receive in connection with the closing of such acquisition) a first priority (subject to
Permitted Liens) perfected security interest
in all property (including, without limitation, Capital Stock) acquired with respect to the
Target in accordance with the terms of Sections 5.10 and 5.12 and the Target, if a it would be a
Material Domestic Subsidiary, shall have executed a Joinder Agreement in accordance with the terms
of Section 5.10, (iv) the Administrative Agent and the Lenders shall have received (A) a
description

26

 

of the material terms of such acquisition and (B) if the total consideration (including
without limitation earn out obligations, deferred compensation, non-competition arrangements and
the amount of Indebtedness and other liabilities assumed by the Credit Parties and their
Subsidiaries) to be paid by the Credit Parties and their Subsidiaries in connection with such
acquisition exceeds $25,000,000, (1) audited financial statements (or, if unavailable,
management-prepared financial statements) of the Target for its two most recent fiscal years and
for any fiscal quarters ended within the fiscal year to date and (2) consolidated projected income
statements of the Borrower and its consolidated Subsidiaries (giving effect to such acquisition),
all in form and substance reasonably satisfactory to the Administrative Agent, (v) the Target shall
have earnings before interest, taxes, depreciation, amortization and non-cash and pension plan
income or expenses for the four fiscal quarter period prior to the acquisition date in an amount
greater than $0, (vi) such acquisition shall not be a “hostile” acquisition and the appropriate
approvals of the applicable Credit Party and the Target shall have been obtained, (vii) after
giving effect to such acquisition, there shall be at least $50,000,000 of borrowing availability
under the Revolving Committed Amount and (viii) the aggregate (A) cash consideration (including,
without limitation, earn out obligations, deferred compensation and payments under non-competition
arrangements) paid (or to be paid) by the Credit Parties and their Subsidiaries in connection with
any such acquisition shall not exceed $25,000,000 and (B) total consideration (including, without
limitation, (1) the maximum amount of earnout obligations, (2) deferred compensation, (3) payments
under non-competition arrangements and (4) the amount of Indebtedness and other liabilities assumed
by the Credit Parties and their Subsidiaries) paid (or to be paid) by the Credit Parties and their
Subsidiaries in connection with any such acquisition shall not exceed $100,000,000.
Notwithstanding the foregoing, for one or more acquisitions by a Credit Party that, in the
aggregate, have total consideration that is less than or equal to $5,000,000 during the term of
this Credit Agreement, the Credit Parties shall only be required to comply with clauses (i) and
(ii) above.

     “Permitted Investments” shall mean:

     (a) cash and Cash Equivalents;

     (b) Investments set forth on Schedule 1.1(b), which Investments shall not
exceed the amount thereof on the Closing Date (after giving effect to the Transactions
consummated on the Closing Date), in each case as such Investments may be adjusted due to
appreciation, repayment of principal, payment of interest, return of capital or similar
circumstances; provided, however, any such Investment consisting of
intercompany Indebtedness owed by a Credit Party to a Subsidiary that is not a Credit Party
shall not be repaid in cash or Cash Equivalents and shall not be renewed, extended,
refinanced or replaced; provided further, however, the Credit
Parties shall be permitted to write-off Investments consisting of intercompany Indebtedness
owing by Subsidiaries that are not Credit Parties to the extent such Indebtedness was
existing prior to the Closing Date;

     (c) receivables owing to the Credit Parties or any of their Subsidiaries or any
receivables and advances to suppliers, in each case if created, acquired or made in the

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ordinary course of business and payable or dischargeable in accordance with customary trade
terms;

     (d) (i) loans and advances to employees for relocation and related expenses and (ii)
loans and advances to employees in the ordinary course of business in an aggregate principal
amount not exceeding $1,500,000; provided that such loans and advances shall comply
with all applicable Requirements of Law;

     (e) Investments (including debt obligations) received in connection with the bankruptcy
or reorganization of suppliers and customers and in settlement of delinquent obligations of,
and other disputes with, customers and suppliers arising in the ordinary course of business;

     (f) Investments (including debt securities) received as consideration for Permitted
Real Estate Sales to the extent such Investments, together with all other non-cash
consideration received for such Permitted Real Estate Sales, do not exceed $30,000,000 in
the aggregate;

     (g) Hedging Agreements permitted hereunder;

     (h) deposits in a customary fashion in the ordinary course of business;

     (i) Investments in and unsecured loans to any Credit Party (other than a Permitted Real
Estate Entity) by any Credit Party or any of its Subsidiaries; provided,
however, that in the case of such intercompany loan or advance by a Credit Party to
another Credit Party, each such loan shall be evidenced by an Intercompany Note payable to
the Credit Party, in form and substance satisfactory to Administrative Agent, which
Intercompany Notes shall be delivered and pledged to the Administrative Agent as part of the
Collateral;

     (j) Permitted Acquisitions and Investments assumed in connection with Permitted
Acquisitions;

     (k) Guaranty Obligations permitted pursuant to Section 6.1(h) and 6.1(k);

     (l) Investments related to costs associated with discontinued operations in an
aggregate amount not to exceed $10,000,000;

     (m) Investments in Permitted Real Estate Entities consisting of cash or Cash
Equivalents in an amount not to exceed $35,000,000; provided that at the time of and
immediately after giving effect to such Investment, the Borrower and its Subsidiaries (other
than Permitted Real Estate Entities) have cash and/or Revolving Availability of not less
than $50,000,000;

     (n) Permitted Real Estate Transfers; and

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     (o) additional loans, advances and/or Investments of a nature not contemplated by the
foregoing clauses hereof in an aggregate amount not to exceed $15,000,000 outstanding at any
time.

     “Permitted Liens” shall mean:

     (a) Liens created by or otherwise existing under or in connection with this Credit
Agreement or the other Credit Documents in favor of the Secured Parties;

     (b) Liens in favor of a Hedging Agreement Provider in connection with a Secured Hedging
Agreement; provided that such Liens shall secure the Credit Party Obligations and
the obligations under such Secured Hedging Agreement on a pari passu basis;

     (c) Liens securing purchase money indebtedness and Capital Lease Obligations (and
refinancings thereof) to the extent permitted under Section 6.1(c); provided, that
(i) any such Lien attaches to such property concurrently with or within (120) days after
the acquisition thereof and (ii) such Lien attaches solely to the property so acquired in
such transaction;

     (d) Customary Permitted Liens;

     (e) Liens existing on the Closing Date listed on Schedule 1.1(c) hereto and any
extension, renewal or replacement thereof but only if the principal amount of the
Indebtedness (including, for purposes of this clause (e), any additional Indebtedness
incurred pursuant to revolving commitments in an amount not in excess of the available
commitment as set forth on Schedule 6.1(b) secured thereby) is not increased and
such Liens do not extend to or cover any other property or assets;

     (f) Liens securing Indebtedness permitted pursuant to Section 6.1(d); provided,
that any such Lien does not extend to any other property (other than accessions and
additions to the property secured thereby);

     (g) Liens on special tooling assets and Intellectual Property of Aerojet as required by
the terms of the contract with Lockheed Martin regarding the Atlas Program;

     (h) Liens securing the financing of insurance premiums associated with insurance
coverage obtained in the normal course of business not to exceed $7,000,000 in the aggregate
at any time outstanding;

     (i) Liens incurred by a Permitted Real Estate Entity; and

     (j) additional Liens incurred by the Borrower or its Subsidiaries (other than the
Permitted Real Estate Entities) which do not secure Indebtedness for money borrowed so long
as the value of the property subject to such Liens, and the obligations secured thereby, do
not exceed $5,000,000 in the aggregate at any one time outstanding.

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     In connection with the granting of Liens of the type described in clause (c) above by the
Borrower or any of its Subsidiaries, at the reasonable request of the Borrower, and at the
Borrower’s expense, the Administrative Agent shall take (and is hereby authorized to take) any
actions reasonably requested by the Borrower in connection therewith (including, without
limitation, by executing appropriate lien releases in favor of the holder or holders of such Liens,
in either case solely with respect to the item or items of equipment or other assets subject to
such Liens).

     “Permitted Real Estate Entity” shall mean a Subsidiary or Joint Venture (a)
established by a Credit Party for the purpose of enhancing the value of and/or selling one or more
real properties of the Credit Parties and (b) designated as a “Permitted Real Estate Entity” by the
Borrower in accordance with Section 5.16 of this Credit Agreement.

     “Permitted Real Estate Entity Distribution” shall mean (a) any dividend or other
distribution, direct or indirect, made to a Credit Party on account of any shares of any class of
Capital Stock of any Permitted Real Estate Entity, now or hereafter outstanding, (b) any
redemption, retirement, sinking fund or similar payment, purchase or other acquisition for value,
direct or indirect, made to a Credit Party of any shares of any class of Capital Stock of any
Permitted Real Estate Entity, now or hereafter outstanding and (c) any payment made to a Credit
Party to retire, or to obtain the surrender of, any outstanding warrants, options or other rights
to acquire shares of any class of Capital Stock of any Permitted Real Estate Entity, now or
hereafter outstanding

     “Permitted Real Estate Sales” shall mean the sale of any owned real property of a
Credit Party (a) subject to a Lien in favor of the Administrative Agent for the benefit of the
Lenders or (b) not listed on Schedule 1.1(f) (as such schedule may be updated from time to
time with the consent of the Administrative Agent), in each case, that satisfies the following
requirements: (i) no Default or Event of Default shall exist at the time of such sale or be caused
by such sale, (ii) such sale is for Fair Market Value, (iii) the Net Cash Proceeds of such sale are
applied to the Loans to the extent required pursuant to Section 2.9(b), and (iv) solely with
respect to any real property subject to a Lien in favor of the Administrative Agent, the Borrower
is in compliance with the Loan to Value Test after giving effect to such Permitted Real Estate
Sale.

     “Permitted Real Estate Transfers” shall mean (a) the contribution, sale or other
transfer of any owned real property of a Credit Party set forth on Schedule 1.1(f) (as such
schedule may be updated from time to time with the consent of the Administrative Agent) to a
Permitted Real Estate Entity and (b) the contribution, sale or other transfer of any owned real
property by a Permitted Real Estate Entity or any other entity in which such Permitted Real Estate
Entity has a direct or indirect ownership interest; provided that in the case of clause (a)
above, such contribution, sale or transfer satisfies the following requirements: (i) no Default or
Event of
Default shall exist at the time of such sale or be caused by such sale and (ii) such sale is for
Fair Market Value.

     “Permitted Real Property Encumbrances” shall mean (a) those liens, encumbrances and
other matters affecting title to any Mortgaged Property listed in the applicable Mortgage Policy

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in respect thereof (or any update thereto) and found, on the date of delivery of such Mortgage Policy
to the Administrative Agent in accordance with the terms hereof, reasonably acceptable by the
Administrative Agent, (b) as to any particular real property at any time, such easements,
encroachments, covenants, restrictions, rights of way, minor defects, irregularities or
encumbrances on title which do not, in the reasonable opinion of the Administrative Agent,
materially impair such real property for the purpose for which it is held by the mortgagor or
owner, as the case may be, thereof, or the Lien held by the Administrative Agent, (c) municipal and
zoning laws, regulations, codes and ordinances, which are not violated in any material respect by
the existing improvements and the present use made by the mortgagor or owner, as the case may be,
of such real property, (d) general real estate taxes and assessments not yet delinquent, and (e)
such other items to which the Administrative Agent may consent.

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

     “Plan” shall mean, at any particular time, any employee benefit plan which is covered
by Title IV of ERISA and in respect of which the Borrower, a Subsidiary 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.

     “Pledge Agreement” shall mean the Amended and Restated Pledge Agreement dated as of
the Closing Date given by the Borrower and the Guarantors to the Administrative Agent, for the
benefit of the Secured Parties, as the same may from time to time be amended, restated, amended and
restated, supplemented or otherwise modified in accordance with the terms hereof and thereof.

     “Prime Rate” shall have the meaning set forth in the definition of Alternate Base
Rate.

     “Properties” shall have the meaning set forth in Section 3.10(a).

     “Purchasing Lenders” shall have the meaning set forth in Section 9.6(c).

     “Recovery Event” shall mean the receipt by the Credit Parties or any of their
Subsidiaries (other than a Permitted Real Estate Entity) of any cash insurance proceeds or
condemnation or expropriation award payable by reason of theft, loss, physical destruction or
damage, taking or similar event with respect to any of their respective property or assets other
than obsolete property or assets no longer used or useful in the business of the Credit Parties or
any of their Subsidiaries.

     “Register” shall have the meaning set forth in Section 9.6(c).

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

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     “Reorganization” shall mean, with respect to any Multiemployer Plan, the condition
that such Plan is in reorganization within the meaning of such term as used in Section 4241 of
ERISA.

     “Reportable Event” shall mean any of the events set forth in Section 4043(c) of ERISA,
other than those events as to which the thirty-day notice period is waived under PBGC Reg. §4043.

     “Required Lenders” shall mean, at any time, Lenders holding in the aggregate more than
fifty percent (50%) of (a) the sum of (i) the Revolving Commitments and (ii) the Credit-Linked
Commitments or (b) if the Commitments have been terminated, the sum of the outstanding Revolving
Loans, Term Loans and Participation Interests; provided, however, that if any
Lender shall be a Defaulting Lender at such time, then there shall be excluded from the
determination of Required Lenders the Commitments of such Lender or, after termination of the
Commitments, the outstanding Revolving Loans, Term Loans and Participation Interests of such
Lender.

     “Required Secured Parties” shall mean, at any time, Lenders and Hedging Agreement
Providers holding in the aggregate more than fifty percent (50%) of (a) the sum of (i) the
Revolving Commitments, (ii) the Credit-Linked Commitments and (iii) the termination value of all
Secured Hedging Agreements (whether or not actually terminated) or (b) if the Commitments have been
terminated, the sum of (i) the outstanding Revolving Loans, Term Loans and Participation Interests
and (ii) the termination value of all Secured Hedging Agreements; provided,
however, that if any Lender shall be a Defaulting Lender at such time, then there shall be
excluded from the determination of Required Secured Parties the Commitments of such Lender or,
after termination of the Commitments, the outstanding Revolving Loans, Term Loans and Participation
Interests of such Lender.

     “Requirement of Law” shall mean, as to any Person, the Certificate of Incorporation
and By-laws or other organizational or governing documents of such Person, and each 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” shall mean, as to (a) the Borrower, (i) with respect to the
execution and delivery of this Agreement, the Notes, the Security Documents, any Notice of
Borrowing or a certificate pursuant to Section 4.1(h), 4.1(q) or 5.2(b) and with respect to any
provision of a Credit Document that refers to the “knowledge” of a Responsible Officer, the Chief
Executive Officer, Chief Financial Officer, the President or any Vice President of the Borrower and
(ii) with respect to the execution and delivery of any other Credit Document or certificate, any
duly authorized officer of the Borrower or representative thereof designated by a duly authorized
officer, or (b) any other Credit Party, any duly authorized officer thereof.

     “Restricted Payment” shall mean (a) any dividend or other distribution, direct or
indirect, on account of any shares of any class of Capital Stock of any Credit Party or any of its
Subsidiaries, now or hereafter outstanding, (b) any redemption, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct or indirect, of any shares of any

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class of Capital Stock of any Credit Party or any of its Subsidiaries, now or hereafter outstanding, (c) any
payment made to retire, or to obtain the surrender of, any outstanding warrants, options or other
rights to acquire shares of any class of Capital Stock of any Credit Party or any of its
Subsidiaries, now or hereafter outstanding, (d) any payment with respect to any earnout obligation,
(e) any payment, prepayment, redemption or similar payment with respect to any Subordinated Debt of
any Credit Party or any of its Subsidiaries and (f) to the extent not included in the corporate
overhead of such Credit Party or such Subsidiary, the payment by any Credit Party or any of its
Subsidiaries of any extraordinary management, advisory or consulting fee to any Person or the
payment of any extraordinary salary, bonus or other form of compensation to any Person who is
directly or indirectly a significant partner, shareholder, owner or executive officer of any such
Person.

     “Revolving Availability” shall mean, on any date, the sum of (a) the aggregate
Revolving Committed Amount minus (b) the aggregate amount of outstanding Revolving Loans
plus outstanding Swingline Loans plus outstanding Revolving LOC Obligations.

     “Revolving Commitment” shall mean, with respect to each Revolving Lender, the
commitment of such Revolving Lender to make Revolving Loans in an aggregate principal amount at any
time outstanding up to an amount equal to such Revolving Lender’s Revolving Commitment Percentage
of the Revolving Committed Amount.

     “Revolving Commitment Fee” shall have the meaning set forth in Section 2.7(a).

     “Revolving Commitment Percentage” shall mean, for each Revolving Lender, the
percentage identified as its Revolving Commitment Percentage on its Lender Commitment Letter or in
the Register, as such percentage may be modified in connection with any assignment made in
accordance with the provisions of Section 9.6(c).

     “Revolving Commitment Period” shall mean (a) with respect to Revolving Loans, the
period from and including the Closing Date to but excluding the Revolving Commitment Termination
Date and (b) with respect to Revolving Letters of Credit, the period from and including the Closing
Date to but excluding the date that is thirty (30) days prior to the Revolving Commitment
Termination Date.

     “Revolving Commitment Termination Date” shall mean the date that is five (5) years
after the Closing Date.

     “Revolving Committed Amount” shall have the meaning set forth in Section 2.1(a).

     “Revolving Issuing Lender” shall mean, with respect to any Revolving Letter of Credit,
the Administrative Agent or such other Lender as requested by the Borrower and approved by the
Administrative Agent, or any other Person that was the Administrative Agent or a Lender at
the time it issued such Revolving Letter of Credit but has ceased to be the Administrative Agent or
a Lender under the Credit Agreement.

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     “Revolving Lender” shall mean, as of any date of determination, a Lender holding a
Revolving Commitment on such date.

     “Revolving Letters of Credit” shall mean any letter of credit issued by the Revolving
Issuing Lender pursuant to Section 2.2(a), as such letter of credit may be amended, modified,
extended, renewed or replaced from time to time.

     “Revolving Loan” shall have the meaning set forth in Section 2.1.

     “Revolving LOC Commitment” shall mean the commitment of the Revolving Issuing Lender
to issue Revolving Letters of Credit and with respect to each Revolving Lender, the commitment of
such Revolving Lender to purchase participation interests in the Letters of Credit up to such
Revolving Lender’s LOC Commitment as specified in its Lender Commitment Letter or in the Register,
as such amount may be reduced from time to time in accordance with the provisions hereof.

     “Revolving LOC Commitment Fee” shall have the meaning set forth in Section 2.7(b).

     “Revolving LOC Committed Amount” shall have the meaning set forth in Section 2.2(a).

     “Revolving LOC Fronting Fee” shall have the meaning set forth in Section 2.7(b).

     “Revolving LOC Obligations” shall mean, at any time, the sum of (i) the maximum amount
which is, or at any time thereafter may become, available to be drawn under Revolving Letters of
Credit then outstanding, assuming compliance with all requirements for drawings referred to in such
Revolving Letters of Credit plus (ii) the aggregate amount of all drawings under Revolving
Letters of Credit honored by the Revolving Issuing Lender but not theretofore reimbursed.

     “Revolving Note” or “Revolving Notes” shall mean the promissory notes of the
Borrower (if any) made by the Borrower pursuant to Section 2.1(e) and payable to the order of any
of the Revolving Lenders evidencing the Revolving Loans provided by any such Revolving Lender,
individually or collectively, as appropriate, as such promissory notes may be amended, modified,
restated, amended and restated, supplemented, extended, renewed or replaced from time to time.

     “Revolving Participation Interest” shall mean a participation interest purchased by a
Revolving Lender in LOC Obligations as provided in Section 2.2(c) and in Swingline Loans as
provided in Section 2.3.

     “Rio Del Oro Property” shall mean the Mortgaged Property identified as “Rio Del Oro”
on Schedule 1.1(e).

     “S&P” shall mean Standard & Poor’s Ratings Services, a division of The McGraw Hill
Companies, Inc.

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     “Sanctioned Country” shall mean a country subject to a sanctions program identified on
the list maintained by OFAC and made publicly available from time to time.

     “Sanctioned Person” shall mean (a) a Person named on the list of “Specially Designated
Nationals and Blocked Persons” maintained by OFAC and made publicly available from time to time, or
(b) (i) an agency of the government of a Sanctioned Country, (ii) an organization controlled by a
Sanctioned Country, or (iii) a person resident in a Sanctioned Country, to the extent subject to a
sanctions program administered by OFAC.

     “SEC” shall mean the Securities and Exchange Commission or any successor thereto.

     “Secured Hedging Agreement” shall mean any Hedging Agreement between a Credit Party
and a Hedging Agreement Provider, as amended, restated, amended and restated, modified,
supplemented or extended from time to time.

     “Secured Parties” shall mean the Lenders and the Hedging Agreement Providers.

     “Security Agreement” shall mean the Amended and Restated Security Agreement dated as
of the Closing Date given by the Borrower and the Guarantors to the Administrative Agent, for the
benefit of the Secured Parties, as amended, restated, amended and restated, modified or
supplemented from time to time in accordance with its terms.

     “Security Documents” shall mean the Security Agreement, the Pledge Agreement, the
Mortgage Instruments and such other documents executed and delivered and/or filed in connection
with the attachment and perfection of the Administrative Agent’s security interests and liens
arising thereunder, including, without limitation, UCC financing statements and patent, trademark
and copyright filings.

     “Senior Secured Consolidated Funded Debt” shall mean, on any date of determination,
Consolidated Funded Debt secured by a Lien on assets of the Borrower or any of its Subsidiaries,
other than Subordinated Debt.

     “Senior Secured Leverage Ratio” shall mean the ratio of (a) Senior Secured
Consolidated Funded Debt (including, without limitation, the Term Loan as increased pursuant to
Section 2.22 and Revolving Loans) to (b) Consolidated EBITDAP (excluding Consolidated EBITDAP
related to real property sold prior to the date of determination) for the twelve-month period
ending as of the most recent fiscal quarter end.

     “Shortfall Amount” shall mean, for any period of determination, the amount by which
the interest that would be payable for such fiscal period for a LIBOR Rate borrowing in the amount
of the Credit-Linked Deposits and with a one month or three month interest period (as such interest
period is determined by the Administrative Agent from time to time) exceeds the return on the
investment of the Credit-Linked Deposits in the Credit-Linked Account for such period.

     “Significant Subsidiary” shall mean any Domestic Subsidiary or Foreign Subsidiary of
any Credit Party the Consolidated Total Assets of which exceeds $500,000.

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     “Single Employer Plan” shall mean any Plan that is not a Multiemployer Plan.

     “Specified Sales” shall mean the sale, transfer, lease or other disposition of (a)
inventory and materials in the ordinary course of business and (b) cash into Cash Equivalents or
Cash Equivalents into cash.

     “Subordinated Debt” shall mean any Indebtedness incurred by any Credit Party
(including, without limitation, the Existing Subordinated Notes) which by its terms is specifically
subordinated in right of payment to the prior payment of the Credit Party Obligations and contains
subordination and other terms acceptable to the Administrative Agent.

     “Subsidiary” shall mean, 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, limited liability company 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 Credit Agreement shall refer to a Subsidiary or
Subsidiaries of the Borrower.

     “Swingline Commitment” shall mean the commitment of the Swingline Lender to make
Swingline Loans in an aggregate principal amount at any time outstanding up to the Swingline
Committed Amount, and the commitment of the Revolving Lenders to purchase participation interests
in the Swingline Loans as provided in Section 2.3(a), as such amounts may be reduced from time to
time in accordance with the provisions hereof.

     “Swingline Committed Amount” shall mean the amount of the Swingline Lender’s Swingline
Commitment as specified in Section 2.3(a).

     “Swingline Lender” shall mean the Administrative Agent and any successor swingline
lender.

     “Swingline Loan” shall have the meaning set forth in Section 2.3(a).

     “Swingline Note” shall mean the promissory note of the Borrower in favor of the
Swingline Lender evidencing the Swingline Loans provided pursuant to Section 2.3(d), as such
promissory note may be amended, modified, supplemented, extended, renewed or replaced from time to
time.

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

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     “Term Loan” shall mean any term loan made by a Credit-Linked Lender from and after the
Closing Date pursuant to Section 2.4(a), any term loan into which a Credit-Linked Purchase is
converted pursuant to Section 2.5(d)(ii) or any term loan incurred in accordance with Section 2.22.

     “Term Loan Commitment” shall mean, with respect to each Credit-Linked Lender, the
commitment of such Credit-Linked Lender to make Term Loans in a principal amount equal to such
Credit-Linked Lender’s Term Loan Commitment Percentage of the Term Loan Committed Amount.

     “Term Loan Commitment Percentage” shall mean, for any Lender, the percentage
identified as its Term Loan Commitment Percentage in its Lender Commitment Letter or in the
Register, as such percentage may be modified in connection with any assignment made in accordance
with the provisions of Section 9.6.

     “Term Loan Committed Amount” shall have the meaning set forth in Section 2.4(a).

     “Term Loan Note” or “Term Loan Notes” shall mean the promissory notes of the
Borrower (if any) made by the Borrower pursuant to Section 2.4(d) and payable to the order of any
of the Credit-Linked Lenders evidencing the Term Loans provided by any such Credit-Linked Lender,
individually or collectively, as appropriate, as such promissory notes may be amended, modified,
restated, amended and restated, supplemented, extended, renewed or replaced from time to time.

     “Trademark License” shall mean any agreement, whether written or oral, providing for
the grant by or to a Person of any right to use any Trademark, including, without limitation, any
thereof referred to in Schedule 3.16 to this Credit Agreement.

     “Trademarks” shall mean all trademarks, trade names, corporate names, company names,
business names, fictitious business names, service marks, elements of package or trade dress of
goods or services, logos and other source or business identifiers, together with the goodwill
associated therewith, now existing or hereafter adopted or acquired, all registrations and
recordings thereof, and all applications in connection therewith, whether in the United States
Patent and Trademark Office or in any similar office or agency of the United States, any State
thereof or any other country or any political subdivision thereof, including, without limitation,
any thereof referred to in Schedule 3.16 to this Credit Agreement, and (ii) all renewals
thereof including, without limitation, any thereof referred to in Schedule 3.16.

     “Tranche” shall mean the collective reference to (a) LIBOR Rate Loans whose Interest
Periods begin and end on the same day and (b) Alternate Base Rate Loans made on the same day. A
Tranche with respect to LIBOR Rate Loans may sometimes be referred to as a “Eurodollar Tranche”.

     “Transactions” shall mean the closing of this Credit Agreement and the other Credit
Documents and the consummation of the other transactions contemplated hereby to occur in

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connection with such closing (including, without limitation, the borrowing of the Term Loans and the payment
of fees and expenses in connection with all of the foregoing).

     “Type” shall mean, as to any Loan, its nature as an Alternate Base Rate Loan or LIBOR
Rate Loan, as the case may be.

     “UCC” shall mean the Uniform Commercial Code from time to time in effect in any
applicable jurisdiction.

     “UCP” shall have the meaning set forth in Section 2.2(g).

     “Unreimbursed Drawing” shall have the meaning set forth in Section 2.5(d)(ii).

     “Voting Securities” shall mean any class of Capital Stock of a Person pursuant to
which the holders thereof have, at the time of determination, the general voting power under
ordinary circumstances to vote for the election of directors, managers, trustees or general
partners of such Person (irrespective of whether or not at the time any other class or classes will
have or might have voting power by reason of the happening of any contingency).

     “Wachovia” shall mean Wachovia Bank, National Association, a national banking
association, together with its successors and/or assigns.

     “WCM” shall mean Wachovia Capital Markets, LLC, together with its successors and
assigns.

     “Weighted Average Life to Maturity” shall mean, when applied to any Indebtedness at
any date, the number of years obtained by dividing (a) the then outstanding principal amount of
such Indebtedness into (b) the total of the product obtained by multiplying (i) the amount of each
then remaining installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity in respect thereof by (ii) the number of years
(calculated to the nearest one-twelfth) that will elapse between such date and the making of such
payment.

     Section 1.2 Other Definitional Provisions.

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

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Sections and Schedules shall be construed to refer to Articles and Sections of and Schedules to,
this Credit Agreement, (e) any reference to any law or regulation herein shall, unless otherwise
specified, refer to such law or regulation as amended, modified or supplemented from time to time
and (f) the words “asset” and “property” shall be construed to have the same meaning and effect and
to refer to any and all tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.

     Section 1.3 Accounting Terms.

     Unless otherwise specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements required to be
delivered hereunder shall be prepared in accordance with GAAP applied on a basis consistent with
the most recent audited consolidated financial statements of the Borrower delivered to the Lenders;
provided that, if the Borrower notifies the Administrative Agent that it wishes to amend
any covenant in Section 5.9 to eliminate the effect of any change in GAAP on the operation of such
covenant (or if the Administrative Agent notifies the Borrower that the Required Lenders wish to
amend Section 5.9 for such purpose), then the Borrower’s compliance with such covenant shall be
determined on the basis of GAAP in effect immediately before the relevant change in GAAP became
effective, until either such notice is withdrawn or such covenant is amended in a manner
satisfactory to the Borrower and the Required Lenders.

     The Borrower shall deliver to the Administrative Agent and each Lender at the same time as the
delivery of any annual or quarterly financial statements given in accordance with the provisions of
Section 5.1, (i) a description in reasonable detail of any material change in the application of
accounting principles employed in the preparation of such financial statements from those applied
in the most recently preceding quarterly or annual financial statements as to which no objection
shall have been made in accordance with the provisions above and (ii) a reasonable estimate of the
effect on the financial statements on account of such changes in application.

     Section 1.4 Time References.

     Unless otherwise specified, all references herein to times of day shall be references to
Eastern time (daylight or standard, as applicable).

     Section 1.5 Execution of Documents.

     Unless otherwise specified, all Credit Documents and all other certificates executed in
connection therewith must be signed by a Responsible Officer.

39

 

ARTICLE II

THE LOANS; AMOUNT AND TERMS

     Section 2.1 Revolving Loans.

     (a) Revolving Commitment. During the Revolving Commitment Period, subject to
the terms and conditions hereof, each Revolving Lender severally agrees to make revolving
credit loans in Dollars (“Revolving Loans”) to the Borrower from time to time for
the purposes hereinafter set forth; provided, however, that (i) with regard
to each Revolving Lender individually, the sum of such Revolving Lender’s Revolving
Commitment Percentage of the aggregate principal amount of outstanding Revolving Loans
plus outstanding Swingline Loans plus outstanding Revolving LOC Obligations
shall not exceed such Revolving Lender’s Revolving Commitment and (ii) with regard to the
Revolving Lenders collectively, the sum of the aggregate principal amount of outstanding
Revolving Loans plus outstanding Swingline Loans plus outstanding Revolving
LOC Obligations shall not exceed the Revolving Committed Amount then in effect. For
purposes hereof, the aggregate principal amount available for Revolving Loan borrowings
hereunder shall be EIGHTY MILLION DOLLARS ($80,000,000) (as such aggregate maximum amount
may be reduced from time to time as provided in Section 2.8, the “Revolving Committed
Amount”). Revolving Loans may consist of Alternate Base Rate Loans or LIBOR Rate Loans,
or a combination thereof, as the Borrower may request, and may be repaid and reborrowed in
accordance with the provisions hereof; provided, however, the Revolving
Loans made on either of the two (2) Business Days immediately following the Closing Date may
only consist of Alternate Base Rate Loans. LIBOR Rate Loans shall be made by each Revolving
Lender at its LIBOR Lending Office and Alternate Base Rate Loans at its Domestic Lending
Office. No Revolving Loans shall be made on the Closing Date.

     (b) Revolving Loan Borrowings.

     (i) Notice of Borrowing. The Borrower may request a Revolving Loan
borrowing by delivering a written Notice of Borrowing (or telephone notice promptly
confirmed in writing by delivery of a written Notice of Borrowing, which delivery
may be by fax) to the Administrative Agent not later than 1:00 P.M. on the date of
the requested borrowing in the case of Alternate Base Rate Loans, and on the third
Business Day prior to the date of the requested borrowing in the case of LIBOR Rate
Loans. Each such Notice of Borrowing shall be irrevocable and shall specify (A)
that a Revolving Loan is requested, (B) the date of the requested borrowing (which
shall be a Business Day), (C) the aggregate principal amount to be borrowed and (D)
whether the borrowing shall be comprised of Alternate Base Rate Loans, LIBOR Rate
Loans or a combination thereof, and if LIBOR Rate Loans are requested, the Interest
Period(s) therefor. If the Borrower shall fail to specify in any such Notice of
Borrowing (1) an applicable Interest Period in the case of a LIBOR Rate Loan, then
such notice shall be deemed to be a request for an Interest Period of one month, or
(2) the

40

 

Type of Revolving Loan requested, then such notice shall be deemed to be a
request for an Alternate Base Rate Loan hereunder. The Administrative Agent shall
give notice to each Revolving Lender promptly upon receipt of each Notice of
Borrowing, the contents thereof and each such Revolving Lender’s share thereof.

     (ii) Minimum Amounts. Each Revolving Loan that is made as an Alternate
Base Rate Loan shall be in a minimum aggregate amount of $1,000,000 and integral
multiples of $100,000 in excess thereof (or the remaining amount of the Revolving
Committed Amount, if less). Each Revolving Loan that is made as a LIBOR Rate Loan
shall be in a minimum aggregate amount of $2,000,000 and integral multiples of
$1,000,000 in excess thereof (or the remaining amount of the Revolving Committed
Amount, if less).

     (iii) Advances. Each Revolving Lender will make its Revolving
Commitment Percentage of each Revolving Loan borrowing available to the
Administrative Agent for the account of the Borrower at the office of the
Administrative Agent specified in Section 9.2, or at such other office as the
Administrative Agent may designate in writing, by 3:00 P.M. (1:00 P.M. in the case
of LIBOR Rate Loans) on the date specified in the applicable Notice of Borrowing, in
Dollars and in funds immediately available to the Administrative Agent. Such
borrowing will then be made available to the Borrower by the Administrative Agent on
the date specified in the applicable Notice of Borrowing (by the end of business
Eastern Time on such date) by crediting the account of the 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.

     (c) Repayment. Subject to the terms of this Credit Agreement, Revolving Loans
may be borrowed, repaid and reborrowed during the Revolving Commitment Period. The
principal amount of all Revolving Loans shall be due and payable in full on the Revolving
Commitment Termination Date.

     (d) Interest. Subject to the provisions of Section 2.10(b), Revolving Loans
shall bear interest as follows:

     (i) Alternate Base Rate Loans. During such periods as Revolving Loans
shall be comprised of Alternate Base Rate Loans, each such Alternate Base Rate Loan
shall bear interest at a per annum rate equal to the sum of the Alternate Base Rate
plus the Applicable Percentage; and

     (ii) LIBOR Rate Loans. During such periods as Revolving Loans shall be
comprised of LIBOR Rate Loans, each such LIBOR Rate Loan shall bear interest at a
per annum rate equal to the sum of the LIBOR Rate plus the Applicable
Percentage.

41

 

Interest on Revolving Loans shall be payable in arrears on each Interest Payment Date.

     (e) Revolving Notes. The Borrower’s obligation to pay each Revolving Lender’s
Revolving Loans shall be evidenced, upon such Revolving Lender’s request, by a Revolving
Note made payable to such Revolving Lender in substantially the form of Schedule
2.1(e).

     Section 2.2 Revolving Letter of Credit Subfacility.

     (a) Issuance. Subject to the terms and conditions hereof and of the LOC
Documents, if any, and any other terms and conditions which the Revolving Issuing Lender may
reasonably require, during the Revolving Commitment Period the Revolving Issuing Lender
shall issue, and the Revolving Lenders shall participate in, standby Revolving Letters of
Credit for the account of the Borrower from time to time upon request in a form acceptable
to the Revolving Issuing Lender; provided, however, that (i) the aggregate
amount of Revolving LOC Obligations shall not at any time exceed FIFTY MILLION DOLLARS
($50,000,000) (the “Revolving LOC Committed Amount”), (ii) with regard to each
Revolving Lender individually, the sum of such Revolving Lender’s Revolving Commitment
Percentage of the aggregate principal amount of outstanding Revolving Loans plus
outstanding Swingline Loans plus outstanding Revolving LOC Obligations shall not
exceed such Revolving Lender’s Revolving Commitment, (iii) with regard to the Revolving
Lenders collectively, the sum of the aggregate principal amount of outstanding Revolving
Loans plus outstanding Swingline Loans plus outstanding Revolving LOC
Obligations shall not exceed the Revolving Committed Amount then in effect, (iv) all
Revolving Letters of Credit shall be denominated in Dollars and (v) Revolving Letters of
Credit may be issued for any lawful corporate purposes, including in connection with
workers’ compensation and other insurance programs. Except as otherwise expressly agreed
upon by all the Revolving Lenders, no Revolving Letter of Credit shall have an original
expiry date more than twelve (12) months from the date of issuance; provided,
however, so long as no Default or Event of Default has occurred and is continuing
and subject to the other terms and conditions to the issuance of Revolving Letters of Credit
hereunder, the expiry dates of Revolving Letters of Credit may be extended annually or
periodically from time to time on the request of the Borrower or by operation of the terms
of the applicable Revolving Letter of Credit to a date not more than twelve (12) months from
the date of extension; provided, further, that no Revolving Letter of
Credit, as originally issued or as extended, shall have an expiry date extending beyond the
date that is ten (10) days prior to the Revolving Commitment Termination Date. Each
Revolving Letter of Credit shall comply with the related LOC Documents. The issuance and
expiry date of each Revolving Letter of Credit shall be a Business Day. Any Revolving
Letter of Credit issued hereunder shall be in a minimum original face amount of $100,000 or
such lesser amount as approved by the Revolving Issuing Lender.

     (b) Notice and Reports. The request for the issuance of a Revolving Letter of
Credit shall be submitted to the Revolving Issuing Lender and the Administrative Agent at
least three (3) Business Days prior to the requested date of issuance. The Revolving

42

 

Issuing Lender will promptly upon request provide to the Administrative Agent for
dissemination to the Revolving Lenders a detailed report specifying the Revolving Letters of
Credit which are then issued and outstanding and any activity with respect thereto which may
have occurred since the date of any prior report, and including therein, among other things,
the account party, the beneficiary, the face amount, expiry date as well as any payments or
expirations which may have occurred. The Revolving Issuing Lender will further provide to
the Administrative Agent promptly upon request copies of the Revolving Letters of Credit.

     (c) Participations. Each Revolving Lender, upon issuance of any Revolving
Letter of Credit (or upon a Person becoming a Revolving Lender hereunder), shall be deemed
to have purchased, without recourse to the Revolving Issuing Lender, and the Revolving
Issuing Lender shall be deemed to have granted without recourse to the Revolving Issuing
Lender, a risk participation from the Revolving Issuing Lender in such Revolving Letter of
Credit and the obligations arising thereunder and any collateral relating thereto, in each
case in an amount equal to its Revolving Commitment Percentage of the maximum amounts
available to be drawn under such Revolving Letter of Credit and shall absolutely,
unconditionally and irrevocably assume, as primary obligor and not as surety, and be
obligated to pay to the Revolving Issuing Lender therefor and discharge when due, its
Revolving Participation Interest by paying its Revolving Commitment Percentage of the
amounts drawn under such Revolving Letter of Credit. Without limiting the scope and nature
of each Revolving Lender’s participation in any Revolving Letter of Credit, to the extent
that the Revolving Issuing Lender has not been reimbursed as required hereunder or under any
LOC Document, each such Revolving Lender shall fund its Revolving Participation Interest
therein by paying to the Revolving Issuing Lender its Revolving Commitment Percentage of
such unreimbursed drawing in same day funds on the day of notification by the Revolving
Issuing Lender of an unreimbursed drawing pursuant to and in accordance with the provisions
of subsection (d) hereof. The obligation of each Revolving Lender to so pay the Revolving
Issuing Lender shall be absolute and unconditional and shall not be affected by the
occurrence of a Default, an Event of Default or any other occurrence or event. Any such
payment shall not relieve or otherwise impair the obligation of the Borrower to reimburse
the Revolving Issuing Lender under any Revolving Letter of Credit, together with interest as
hereinafter provided.

     (d) Reimbursement. In the event of any drawing under any Revolving Letter of
Credit, the Revolving Issuing Lender will promptly notify the Borrower and the
Administrative Agent. The Borrower shall reimburse the Revolving Issuing Lender on the day
of drawing under any Revolving Letter of Credit (either with the proceeds of a Revolving
Loan obtained hereunder or otherwise) in same day funds as provided herein or in the LOC
Documents if the Borrower shall have been given notice of such drawing by 12:00 Noon and
otherwise on the next Business Day after such drawing if the Borrower shall have been given
notice of such drawing after 12:00 Noon. If the Borrower shall be given notice of a drawing
by 12:00 Noon and shall fail to reimburse the Revolving Issuing Lender on the same date of
such notice, the unreimbursed amount of such drawing shall bear interest from the date of
notice until payment in full at a per

43

 

annum rate equal to the ABR Default Rate. If the Borrower shall be given notice of a
drawing after 12:00 Noon, the unreimbursed amount of such drawing shall bear interest from
the date of notice until the next Business Day at a per annum rate equal to the Alternate
Base Rate plus the Applicable Percentage and if the Borrower shall fail to reimburse the
Revolving Issuing Lender on such next Business Day, the unreimbursed amount of such drawing
shall bear interest from the Business Day succeeding the date of notice until payment in
full at a per annum rate equal to the ABR Default Rate. Unless the Borrower shall
immediately notify the Revolving Issuing Lender and the Administrative Agent of its intent
to otherwise reimburse the Revolving Issuing Lender, the Borrower shall be deemed to have
requested a Mandatory LOC Borrowing in the amount of the drawing as provided in subsection
(d) hereof, the proceeds of which will be used to satisfy the reimbursement obligations.
The Borrower’s reimbursement obligations hereunder shall be absolute and unconditional under
all circumstances irrespective of any rights of set-off, counterclaim or defense to payment
the Borrower may claim or have against the Revolving Issuing Lender, the Administrative
Agent, the Lenders, the beneficiary of the Revolving Letter of Credit drawn upon or any
other Person, including without limitation any defense based on any failure of the Borrower
to receive consideration or the legality, validity, regularity or unenforceability of the
Revolving Letter of Credit; provided that the Borrower shall not be deemed to have
waived any claims it may have against the Revolving Issuing Lender, the Administrative
Agent, the Lenders, the beneficiary of the Revolving Letter of Credit drawn upon or any
other Person and may separately pursue such claims after payment of such reimbursement
obligations. The Revolving Issuing Lender will promptly notify the Administrative Agent
(which shall promptly notify the Revolving Lenders) of the amount of any unreimbursed
drawing and each Revolving Lender shall promptly fund its Revolving Participation Interest
therein by paying to the Administrative Agent for the account of the Revolving Issuing
Lender, in Dollars and in immediately available funds, the amount of such Revolving Lender’s
Revolving Commitment Percentage of such unreimbursed drawing. Such payment shall be made on
the day such notice is received by such Revolving Lender from the Revolving Issuing Lender
if such notice is received at or before 2:00 P.M., otherwise such payment shall be made at
or before 12:00 Noon on the Business Day next succeeding the day such notice is received.
If such Revolving Lender does not pay such amount to the Revolving Issuing Lender in full
upon such request, such Revolving Lender shall, on demand, pay to the Administrative Agent
for the account of the Revolving Issuing Lender interest on the unpaid amount during the
period from the date of such drawing until such Revolving Lender pays such amount to the
Revolving Issuing Lender in full at a rate per annum equal to, if paid within two (2)
Business Days of the date of drawing, the Federal Funds Effective Rate and thereafter at a
rate equal to the Alternate Base Rate. Each Revolving Lender’s obligation to make such
payment to the Revolving Issuing Lender, and the right of the Revolving Issuing Lender to
receive the same, shall be absolute and unconditional, shall not be affected by any
circumstance whatsoever and without regard to the termination of this Credit Agreement or
the Commitments hereunder, the existence of a Default or Event of Default or the
acceleration of the Credit Party Obligations hereunder and shall be made without any offset,
abatement, withholding or reduction whatsoever.

44

 

     (e) Repayment with Revolving Loans. On any day on which the Borrower shall
have requested, or been deemed to have requested, a Revolving Loan to reimburse a drawing
under a Revolving Letter of Credit, the Administrative Agent shall give notice to the
Revolving Lenders that a Revolving Loan has been requested or deemed requested in connection
with a drawing under a Revolving Letter of Credit, in which case a Revolving Loan borrowing
comprised entirely of Alternate Base Rate Loans (each such borrowing, a “Mandatory LOC
Borrowing”) shall be made (without giving effect to any termination of the Commitments
pursuant to Section 7.2) pro rata based on each Revolving Lender’s
respective Revolving Commitment Percentage (determined before giving effect to any
termination of the Commitments pursuant to Section 7.2) and the proceeds thereof shall be
paid directly to the Revolving Issuing Lender for application to the respective Revolving
LOC Obligations. Each Revolving Lender hereby irrevocably agrees to make such Revolving
Loans on the day such notice is received by the Revolving Lenders from the Administrative
Agent if such notice is received at or before 2:00 P.M., otherwise such payment shall be
made at or before 12:00 Noon on the Business Day next succeeding the day such notice is
received, in each case notwithstanding (i) the amount of Mandatory LOC Borrowing may
not comply with the minimum amount for borrowings of Revolving Loans otherwise required
hereunder, (ii) whether any conditions specified in Section 4.2 are then satisfied, (iii)
whether a Default or an Event of Default then exists, (iv) failure for any such request or
deemed request for Revolving Loan to be made by the time otherwise required in Section
2.1(b), (v) the date of such Mandatory LOC Borrowing, or (vi) any reduction in the Revolving
Committed Amount after any such Revolving Letter of Credit may have been drawn upon. In the
event that any Mandatory LOC Borrowing cannot for any reason be made on the date otherwise
required above (including, without limitation, as a result of the occurrence of a Bankruptcy
Event), then each such Revolving Lender hereby agrees that it shall forthwith fund (as of
the date the Mandatory LOC Borrowing would otherwise have occurred, but adjusted for any
payments received from the Borrower on or after such date and prior to such purchase) its
Revolving Participation Interests in the outstanding Revolving LOC Obligations;
provided, further, that in the event any Revolving Lender shall fail to fund
its Revolving Participation Interest on the day the Mandatory LOC Borrowing would otherwise
have occurred, then the amount of such Revolving Lender’s unfunded Revolving Participation
Interest therein shall bear interest payable by such Revolving Lender to the Revolving
Issuing Lender upon demand, at the rate equal to, if paid within two (2) Business Days of
such date, the Federal Funds Effective Rate, and thereafter at a rate equal to the Alternate
Base Rate.

     (f) Modification, Extension. The issuance of any supplement, modification,
amendment, renewal, or extension to any Revolving Letter of Credit shall, for purposes
hereof, be treated in all respects the same as the issuance of a new Revolving Letter of
Credit hereunder.

     (g) Uniform Customs and Practices. The Revolving Issuing Lender shall have the
Letters of Credit be subject to The Uniform Customs and Practice for Documentary Credits, as
published as of the date of issue by the International Chamber of Commerce (the
“UCP”), in which case the UCP may be incorporated therein and deemed in all respects
to be a part thereof.

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     (h) Designation of Subsidiaries as Account Parties. Notwithstanding anything
to the contrary set forth in this Agreement, a Revolving Letter of Credit issued hereunder
may contain a statement to the effect that such Revolving Letter of Credit is issued for the
account of a Subsidiary of the Borrower; provided that, notwithstanding such
statement, the Borrower shall be the actual account party for all purposes of this Agreement
for such Revolving Letter of Credit and such statement shall not affect the Borrower’s
reimbursement obligations hereunder with respect to such Revolving Letter of Credit.

     Section 2.3 Swingline Loan Subfacility.

     (a) Swingline Commitment. During the Revolving Commitment Period, subject to
the terms and conditions hereof, the Swingline Lender, in its individual capacity, agrees to
make certain revolving credit loans to the Borrower (each a “Swingline Loan” and,
collectively, the “Swingline Loans”) for the purposes hereinafter set forth;
provided, however, (i) the aggregate amount of Swingline Loans outstanding
at any time shall not exceed TEN MILLION DOLLARS ($10,000,000) (the “Swingline Committed
Amount”), and (ii) the sum of the aggregate principal amount of outstanding Revolving
Loans plus outstanding Swingline Loans plus outstanding Revolving LOC
Obligations shall not exceed the Revolving Committed Amount. Swingline Loans hereunder may
be repaid and reborrowed in accordance with the provisions hereof.

     (b) Swingline Loan Borrowings.

     (i) Notice of Borrowing and Disbursement. The Swingline Lender will
make Swingline Loans available to the Borrower on any Business Day upon delivery of
a Notice of Borrowing by the Borrower to the Administrative Agent not later than
2:00 P.M. on such Business Day. Swingline Loan borrowings hereunder shall be made
in minimum amounts of $100,000 and in integral amounts of $100,000 in excess
thereof. Such borrowing will then be made available to the Borrower by the
Swingline Lender on the date specified in the applicable Notice of Borrowing (by the
end of business Eastern Time on such date) by crediting the account of the Borrower
on the books of such office with the aggregate of the amounts made available to the
Administrative Agent by the Swingline Lender and in like funds as received by the
Administrative Agent.

     (ii) Repayment of Swingline Loans. Each Swingline Loan borrowing shall
be due and payable on the Revolving Commitment Termination Date. The Swingline
Lender may, at any time, in its sole discretion, by written notice to the Borrower
and the Administrative Agent, demand repayment of its Swingline Loans by way of a
Revolving Loan borrowing, in which case the Borrower shall be deemed to have
requested a Revolving Loan borrowing comprised entirely of Alternate Base Rate Loans
in the amount of such Swingline Loans; provided, however, that in
the following circumstances, any such demand shall also be deemed to have been given
one Business Day prior to each of (1) the Revolving Commitment Termination Date, (2)
the occurrence of any Bankruptcy Event, (3)

46

 

upon acceleration of the Credit Party Obligations hereunder, whether on account
of a Bankruptcy Event or any other Event of Default, and (4) the exercise of
remedies in accordance with the provisions of Section 7.2 hereof (each such
Revolving Loan borrowing made on account of any such deemed request therefor as
provided herein being hereinafter referred to as “Mandatory Swingline
Borrowing”). Each Revolving Lender hereby irrevocably agrees to make such
Revolving Loans promptly upon any such request or deemed request on account of each
Mandatory Swingline Borrowing in the amount and in the manner specified in the
preceding sentence and on the same such date notwithstanding (I) the amount
of the Mandatory Swingline Borrowing may not comply with the minimum amount for
borrowings of Revolving Loans otherwise required hereunder, (II) whether any
conditions specified in Section 4.2 are then satisfied, (III) whether a Default or
an Event of Default then exists, (IV) failure of any such request or deemed request
for Revolving Loans to be made by the time otherwise required in Section 2.1(b)(i),
(V) the date of such Mandatory Swingline Borrowing, or (VI) any reduction in the
Revolving Committed Amount or termination of the Revolving Commitments immediately
prior to such Mandatory Swingline Borrowing or contemporaneously therewith. In the
event that any Mandatory Swingline Borrowing cannot for any reason be made on the
date otherwise required above (including, without limitation, as a result of the
commencement of a proceeding under the Bankruptcy Code), then each Revolving Lender
hereby agrees that it shall forthwith purchase (as of the date the Mandatory
Swingline Borrowing would otherwise have occurred, but adjusted for any payments
received from the Borrower on or after such date and prior to such purchase) from
the Swingline Lender such participations in the outstanding Swingline Loans as shall
be necessary to cause each such Revolving Lender to share in such Swingline Loans
ratably based upon its respective Revolving Commitment Percentage (determined before
giving effect to any termination of the Commitments pursuant to Section 7.2);
provided that (x) all interest payable on the Swingline Loans shall be for
the account of the Swingline Lender until the date as of which the respective
participation is purchased, and (y) at the time any purchase of participations
pursuant to this sentence is actually made, the purchasing Revolving Lender shall be
required to pay to the Swingline Lender interest on the principal amount of such
participation purchased for each day from and including the day upon which the
Mandatory Swingline Borrowing would otherwise have occurred to but excluding the
date of payment for such participation, at the rate equal to, if paid within two (2)
Business Days of the date of the Mandatory Swingline Borrowing, the Federal Funds
Effective Rate, and thereafter at a rate equal to the Alternate Base Rate.

     (c) Interest on Swingline Loans. Subject to the provisions of Section 2.11(b),
Swingline Loans shall bear interest at a per annum rate equal to the Alternate Base Rate
plus the Applicable Percentage for Revolving Loans that are Alternate Base Rate
Loans. Interest on Swingline Loans shall be payable in arrears on each Interest Payment
Date.

47

 

     (d) Swingline Note. The Swingline Loans shall be evidenced by a duly executed
promissory note of the Borrower to the Swingline Lender in the original amount of the
Swingline Committed Amount and substantially in the form of Schedule 2.3(d).

     Section 2.4 Credit-Linked Facility—Term Loan Subfacility.

     (a) Term Loan. Subject to the terms and conditions hereof and in reliance upon
the representations and warranties set forth herein, each Credit-Linked Lender severally
agrees to make available to the Administrative Agent on the Closing Date such Credit-Linked
Lender’s Credit-Linked Commitment Percentage of Term Loans in Dollars in the aggregate
principal amount of SEVENTY-FIVE MILLION DOLLARS ($75,000,000) (as such amount may be
increased by any Credit-Linked Purchase that is converted to Term Loans pursuant to Section
2.5(d)(ii) or increased by any Incremental Term Loan pursuant to Section 2.22, the “Term
Loan Committed Amount”) for the purposes hereinafter set forth; provided,
however, (i) with regard to each Credit-Linked Lender individually, the sum of such
Credit-Linked Lender’s Credit-Linked Commitment Percentage of the aggregate principal amount
of the outstanding Term Loans plus outstanding Credit-Linked LOC Obligations shall
not at any time exceed such Credit-Linked Lender’s Credit-Linked Commitment and (ii) with
regard to the Credit-Linked Lenders collectively, the sum of the aggregate principal amount
of the outstanding Term Loans plus outstanding Credit-Linked LOC Obligations shall
not at any time exceed the Credit-Linked Committed Amount then in effect. Upon receipt by
the Administrative Agent of the proceeds of the Term Loan made on the Closing Date, such
proceeds will then be made available to the Borrower by the Administrative Agent by
crediting the account of the Borrower on the books of the office of the Administrative Agent
specified in Section 9.2, or at such other office as the Administrative Agent may designate
in writing, with the aggregate of such proceeds made available to the Administrative Agent
by the Credit-Linked Lenders and in like funds as received by the Administrative Agent (or
by crediting such other account(s) as directed by the Borrower). Each Term Loan may consist
of Alternate Base Rate Loans or LIBOR Rate Loans, or a combination thereof, as the Borrower
may request. Amounts repaid or prepaid on any Term Loan may not be reborrowed. LIBOR Rate
Loans shall be made by each Credit-Linked Lender at its LIBOR Lending Office and Alternate
Base Rate Loans at its Domestic Lending Office.

     (b) Repayment of Term Loans. The principal amount of the Term Loans shall be
repaid in twenty-three (23) consecutive calendar quarterly installments and on the
Credit-Linked Maturity Date as follows, unless accelerated sooner pursuant to Section 7.2:

	 	 	 	 	 	 	 	 
	 	Principal Amortization Payment	 	Term Loan Principal Amortization
	 	Dates	 	Payment
	 
	August 31, 2007	 	$	187,500	 
	 
	November 30, 2007	 	$	187,500	 
	 
	February 28, 2008	 	$	187,500	 
	 
	May 31, 2008	 	$	187,500	 

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	 	Principal Amortization Payment	 	Term Loan Principal Amortization
	 	Dates	 	Payment
	 
	August 31, 2008	 	$	187,500	 
	 
	November 30, 2008	 	$	187,500	 
	 
	February 28, 2009	 	$	187,500	 
	 
	May 31, 2009	 	$	187,500	 
	 
	August 31, 2009	 	$	187,500	 
	 
	November 30, 2009	 	$	187,500	 
	 
	February 28, 2010	 	$	187,500	 
	 
	May 31, 2010	 	$	187,500	 
	 
	August 31, 2010	 	$	187,500	 
	 
	November 30, 2010	 	$	187,500	 
	 
	February 28, 2011	 	$	187,500	 
	 
	May 31, 2011	 	$	187,500	 
	 
	August 31, 2011	 	$	187,500	 
	 
	November 30, 2011	 	$	187,500	 
	 
	February 28, 2012	 	$	187,500	 
	 
	May 31, 2012	 	$	187,500	 
	 
	August 31, 2012	 	$	187,500	 
	 
	November 30, 2012	 	$	187,500	 
	 
	February 28, 2013	 	$	187,500	 
	 
	Credit-Linked Maturity Date	 	Remaining principal amount of Term Loans

     The outstanding principal amount of the Term Loans and all accrued but unpaid interest
and other amounts payable with respect to the Term Loans shall be repaid on the
Credit-Linked Maturity Date. In addition, the amounts set forth above shall be increased
on a pro rata basis by the amount of any Term Loan incurred pursuant to Section 2.22

     (c) Interest on the Term Loans. Subject to the provisions of Section 2.11, the
Term Loan shall bear interest as follows:

     (i) Alternate Base Rate Loans. During such periods as the Term Loans
shall be comprised of Alternate Base Rate Loans, each such Alternate Base Rate Loan
shall bear interest at a per annum rate equal to the sum of the Alternate Base Rate
plus the Applicable Percentage; and

     (ii) LIBOR Rate Loans. During such periods as the Term Loans shall be
comprised of LIBOR Rate Loans, each such LIBOR Rate Loan shall bear interest at a
per annum rate equal to the sum of the LIBOR Rate plus the Applicable
Percentage.

     Interest on the Term Loans shall be payable in arrears on each Interest Payment
Date.

     (d) Term Loan Notes. The Borrower’s obligation to pay each Credit-Linked
Lender’s portion of the Term Loans shall be evidenced, upon such Credit-Linked

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Lender’s request, by a Term Loan Note made payable to such Credit-Linked Lender in
substantially the form of Schedule 2.4(d).

     Section 2.5 Credit-Linked Facility – Letter of Credit Subfacility.

     (a) Issuance. Subject to the terms and conditions hereof and of the LOC
Documents, if any, and any other terms and conditions which the Credit-Linked Issuing Lender
may reasonably require, during the Credit-Linked Commitment Period the Credit-Linked Issuing
Lender shall issue, and the Credit-Linked Lenders shall participate in, standby
Credit-Linked Letters of Credit for the account of the Borrower from time to time upon
request in a form acceptable to the Credit-Linked Issuing Lender; provided,
however, that (i) the aggregate amount of Credit-Linked LOC Obligations shall not at
any time exceed the lesser of (A) ONE HUNDRED TWENTY-FIVE MILLION DOLLARS ($125,000,000) (as
reduced from time to time in accordance with the terms of Section 2.5(d)(ii) or Section
2.8(a), the “Credit-Linked LOC Committed Amount”) and (B) the principal amount of
the Credit-Linked Deposit, (ii) with regard to each Credit-Linked Lender individually, (A)
the sum of such Credit-Linked Lender’s Credit-Linked Commitment Percentage of the
outstanding Credit-Linked LOC Obligations shall not exceed such Credit-Linked Lender’s
Credit-Linked Deposit and (B) the sum of such Credit-Linked Lender’s Credit-Linked
Commitment Percentage of the aggregate principal amount of the outstanding Term Loans
plus outstanding Credit-Linked LOC Obligations shall not at any time exceed such
Credit-Linked Lender’s Credit-Linked Commitment, (iii) with regard to the Credit-Linked
Lenders collectively, the sum of the aggregate principal amount of outstanding Term Loans
plus outstanding Credit-Linked LOC Obligations shall not at any time exceed the
Credit-Linked Committed Amount then in effect, (iv) no Credit-Linked Letter of Credit may be
issued without the Administrative Agent confirming in writing to any Credit-Linked Issuing
Lender (other than the Administrative Agent in its capacity as a Credit-Linked Issuing
Lender) that, after giving effect to the issuance of such Credit-Linked Letter of Credit,
the requirement set forth in clause (iii) above shall be satisfied, (v) all Credit-Linked
Letters of Credit shall be denominated in Dollars and (vi) Credit-Linked Letters of Credit
shall be issued for any lawful corporate purposes, including in connection with workers’
compensation and other insurance programs. Except as otherwise expressly agreed upon by all
the Credit-Linked Lenders, no Credit-Linked Letter of Credit shall have an original expiry
date more than twelve (12) months from the date of issuance; provided,
however, the expiry dates of Credit-Linked Letters of Credit may be extended
annually or periodically from time to time at the request of the Borrower or by operation of
the terms of the applicable Letter of Credit to a date not more than twelve (12) months from
the date of extension; provided, further, that (x) no Credit-Linked Letter
of Credit, as originally issued or as extended, shall have an expiry date extending beyond
the date that is ten (10) days prior to the Credit-Linked Maturity Date and (y) if an Event
of Default exists at the time such Credit-Linked Letter of Credit is to be extended, the
Credit-Linked Issuing Lender may or, at the direction of Credit-Linked Lenders holding more
than 50% of the Credit-Linked Commitments, the Credit-Linked Issuing Lender shall refuse to
extend such Credit-Linked Letter of Credit, in which case such Credit-Linked Letter of
Credit shall terminate at the end of the current term thereof. Each Credit-Linked Letter of
Credit shall comply

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with the related LOC Documents. The issuance and expiry date of each Credit-Linked Letter
of Credit shall be a Business Day. Any Credit-Linked Letters of Credit issued hereunder
shall be in a minimum original face amount of $100,000 or such lesser amount as approved by
the Credit-Linked Issuing Lender.

     (b) Notice and Reports. The request for the issuance of a Credit-Linked Letter
of Credit shall be submitted to the Credit-Linked Issuing Lender and the Administrative
Agent at least three (3) Business Days prior to the requested date of issuance. The
Credit-Linked Issuing Lender will promptly upon request provide to the Administrative Agent
for dissemination to the Credit-Linked Lenders a detailed report specifying the
Credit-Linked Letters of Credit which are then issued by such Credit-Linked Issuing Lender
and outstanding and any activity with respect thereto which may have occurred since the date
of any prior report, and including therein, among other things, the account party, the
beneficiary, the face amount, expiry date as well as any payments or expirations which may
have occurred. The Credit-Linked Issuing Lender will further provide to the Administrative
Agent promptly upon request copies of the Credit-Linked Letters of Credit.

     (c) Participations. Each Credit-Linked Lender, upon issuance of any
Credit-Linked Letter of Credit (or upon a Person becoming a Credit-Linked Lender hereunder)
and, in the case of each Existing Letter of Credit, on the Closing Date, shall be deemed to
have irrevocably purchased, without recourse to the Credit-Linked Issuing Lender, and the
Credit-Linked Issuing Lender shall be deemed to have irrevocably granted without recourse to
the Credit-Linked Issuing Lender, a risk participation (a “Credit-Linked
Participation”) from the Credit-Linked Issuing Lender in such Credit-Linked Letter of
Credit and the obligations arising thereunder and any collateral relating thereto, in each
case in an amount equal to its Credit-Linked Commitment Percentage of the maximum amounts
available to be drawn under such Credit-Linked Letter of Credit and shall absolutely,
unconditionally and irrevocably assume, as primary obligor and not as surety, and be
obligated to pay to the Credit-Linked Issuing Lender therefor and discharge when due, its
Credit-Linked Commitment Percentage of the obligations arising under such Credit-Linked
Letter of Credit. Without limiting the scope and nature of each Credit-Linked Lender’s
participation in any Credit-Linked Letter of Credit, to the extent that the Credit-Linked
Issuing Lender has not been reimbursed as required hereunder or under any LOC Document, each
such Credit-Linked Lender shall fund its Credit-Linked Participation Interest therein by
paying to the Credit-Linked Issuing Lender, from funds deposited by such Credit-Linked
Lender into the Credit-Linked Deposit, its Credit-Linked Commitment Percentage of such
unreimbursed drawing in same day funds on the day of notification by the Credit-Linked
Issuing Lender of an unreimbursed drawing pursuant to and in accordance with the provisions
of subsection (d) hereof. The obligation of each Credit-Linked Lender to so pay the
Credit-Linked Issuing Lender shall be absolute and unconditional and shall not be affected
by the occurrence of a Default, an Event of Default or any other occurrence or event.

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     (d) Reimbursement; Funding of Participation Interests.

     (i) Reimbursement by Borrower. In the event of any drawing under any
Credit-Linked Letter of Credit, the Credit-Linked Issuing Lender will promptly
notify the Borrower and the Administrative Agent. Upon a drawing under a
Credit-Linked Letter of Credit, the Borrower shall, subject to the terms of this
subsection, reimburse the Credit-Linked Issuing Lender on the day of such drawing
(either with the proceeds of a Revolving Loan or otherwise) in same day funds as
provided herein or in the Credit-Linked Letter of Credit Documents if the Borrower
shall have been given notice of such drawing by 12:00 Noon and otherwise on the next
Business Day after such drawing if the Borrower shall have been given notice of such
drawing after 12:00 Noon. If the Borrower shall be given notice of a drawing by
12:00 Noon and shall fail to reimburse the Credit-Linked Issuing Lender on the same
date of such notice, the unreimbursed amount of such drawing shall bear interest
from the date of notice until the first to occur of (A) the reimbursement of such
drawing or (B) the conversion of such Unreimbursed Drawing to a Term Loan pursuant
to subsection (d)(ii) below at a per annum rate equal to the ABR Default Rate. If
the Borrower shall be given notice of a drawing after 12:00 Noon, the unreimbursed
amount of such drawing shall bear interest from the date of notice until the next
Business Day at a per annum rate equal to the Alternate Base Rate plus the
Applicable Percentage and if the Borrower shall fail to reimburse the Credit-Linked
Issuing Lender on such next Business Day, the unreimbursed amount of such drawing
shall bear interest from the Business Day succeeding the date of notice until the
first to occur of (A) the reimbursement of such drawing or (B) the conversion of
such Unreimbursed Drawing to a Term Loan pursuant to subsection (d)(ii) below at a
per annum rate equal to the ABR Default Rate. Unless the Borrower shall promptly
notify the Credit-Linked Issuing Lender and the Administrative Agent of its intent
to otherwise reimburse the Credit-Linked Issuing Lender after receipt by the
Borrower of notice of a drawing, the Borrower shall be deemed to have requested a
Credit-Linked Purchase in the amount of such drawing as provided in subsection
(d)(ii) below, the proceeds of which will be used to satisfy the reimbursement
obligations. The Borrower’s reimbursement obligations hereunder shall be absolute
and unconditional under all circumstances irrespective of any rights of set-off,
counterclaim or defense to payment the Borrower may claim or have against the
Credit-Linked Issuing Lender, the Administrative Agent, the Lenders, the beneficiary
of the Credit-Linked Letter of Credit drawn upon or any other Person, including
without limitation any defense based on any failure of the Borrower to receive
consideration or the legality, validity, regularity or unenforceability of the
Credit-Linked Letter of Credit; provided that the Borrower shall not be
deemed to have waived any claims it may have against the Credit-Linked Issuing
Lender, the Administrative Agent, the Lenders, the beneficiary of the Credit-Linked
Letter of Credit drawn upon or any other Person and may separately pursue such
claims after payment of such reimbursement obligations.

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     (ii) Funding of Participation Interests by Credit-Linked Lenders;
Conversion to Term Loans. After any drawing under any Credit-Linked Letter of
Credit and upon the earlier of (A) the failure of the Borrower to reimburse such
drawing in accordance with the terms of subsection (d)(i) hereof, (B) receipt by the
Credit-Linked Issuing Lender of notice from the Borrower that it will not exercise
its right to reimburse such drawing and (C) the occurrence or continuation of a
Default or an Event of Default, (1) in order to fund its Credit-Linked Participation
Interest in such unreimbursed drawing (an “Unreimbursed Drawing”), each
Credit-Linked Lender hereby authorizes the Administrative Agent to pay the
Credit-Linked Issuing Lender (such payment, a “Credit-Linked Purchase”) in
the amount of such Credit-Linked Lender’s Credit-Linked Commitment Percentage of
such Unreimbursed Drawing, solely from such Credit-Linked Lender’s Credit-Linked
Deposit, and such Credit-Linked Lender hereby irrevocably authorizes the
Administrative Agent to charge the Credit-Linked Account for such purpose, (2) the
Credit-Linked LOC Committed Amount shall be automatically reduced by the amount of
each Credit-Linked Purchase and shall not be reinstated, (3) such Unreimbursed
Drawing shall be automatically converted to a funded Term Loan consisting of an
Alternate Base Rate Loan without any further act by the Borrower, the Credit-Linked
Issuing Lender, the Administrative Agent or any Credit-Linked Lender, which Term
Loan shall be subject to the terms and conditions of Section 2.4 and (4) the Term
Loan Committed Amount shall be automatically permanently increased by the amount of
each Credit-Linked Purchase. The Credit-Linked Issuing Lender will promptly notify
the Administrative Agent (which shall notify the Credit-Linked Lenders) of the
amount of any Unreimbursed Drawing. Each Credit-Linked Lender’s obligation to fund
its Credit-Linked Participation Interest in any Unreimbursed Drawing by paying to
the Credit-Linked Issuing Lender its Credit-Linked Commitment Percentage of any
Unreimbursed Drawing, and the right of the Credit-Linked Issuing Lender to receive
the same, shall be absolute and unconditional, shall be made without any offset,
abatement, withholding or reduction whatsoever and shall not be affected by any
circumstance whatsoever and without regard to (I) whether any conditions specified
in Section 4.2 are then satisfied, (II) whether a Default or an Event of Default
then exists, (III) the date of such Credit-Linked Purchase and Term Loan, (IV) any
reduction in the Credit-Linked Committed Amount after any such Credit-Linked Letter
of Credit may have been drawn upon, (V) the termination of this Credit Agreement or
the Commitments hereunder or (VI) the acceleration of the Credit Party Obligations
hereunder.

     (e) Repayment of Participations.

     (i) At any time after the Credit-Linked Issuing Lender has made a payment under
any Credit-Linked Letter of Credit and has received from the Credit-Linked Account
the proceeds of Credit-Linked Purchases by the Credit-Linked Lenders in respect of
such payment in accordance with Section 2.5(d) (which Credit-Linked Purchases have
been converted to Term Loans in

53

 

accordance with such Section), if the Administrative Agent receives for the
account of the Credit-Linked Issuing Lender any payment in respect of the related
Unreimbursed Drawing or interest thereon for any period after such Unreimbursed
Drawing was paid with a Credit-Linked Purchase, the Administrative Agent will
distribute to such Credit-Linked Lender its Term Loan Commitment Percentage thereof.
If the Credit-Linked Issuing Lender shall have received from the Credit-Linked
Account the proceeds of Credit-Linked Purchases by the Credit-Linked Lenders and
thereafter shall receive any direct payment from the Borrower in respect of the
Unreimbursed Drawing with respect to which such Credit-Linked Purchases were made,
the Credit-Linked Issuing Lender shall immediately pay the amount received to the
Administrative Agent for distribution to the Credit-Linked Lenders in accordance
with this Section 2.5(e).

     (ii) If any payment received by the Administrative Agent for the account of the
Credit-Linked Issuing Lender pursuant to Section 2.5(e)(i) and distributed to the
Credit-Linked Lenders by the Administrative Agent is required to be returned under
any circumstance (including pursuant to any settlement entered into by the
Credit-Linked Issuing Lender), each Credit-Linked Lender shall pay to the
Administrative Agent for the account of the Credit-Linked Issuing Lender its
Credit-Linked Commitment Percentage thereof on demand of the Administrative Agent,
plus interest thereon from the date of such demand to the date such amount is
returned by such Credit-Linked Lender, at a rate per annum equal to the Federal
Funds Rate from time to time in effect.

     (f) Modification, Extension. The issuance of any supplement, modification,
amendment, renewal, or extension to any Credit-Linked Letter of Credit shall, for purposes
hereof, be treated in all respects the same as the issuance of a new Credit-Linked Letter of
Credit hereunder.

     (g) Uniform Customs and Practices. The Credit-Linked Issuing Lender shall have
the Letters of Credit be subject to The Uniform Customs and Practice for Documentary
Credits, as published as of the date of issue by the UCP in which case the UCP may be
incorporated therein and deemed in all respects to be a part thereof.

     (h) Designation of Subsidiaries as Account Parties. Notwithstanding anything
to the contrary set forth in this Agreement, a Credit-Linked Letter of Credit issued
hereunder may contain a statement to the effect that such Credit-Linked Letter of Credit is
issued for the account of a Subsidiary of the Borrower; provided that,
notwithstanding such statement, the Borrower shall be the actual account party and borrower
for all purposes of this Agreement for such Credit-Linked Letter of Credit and any
Credit-Linked Purchase and Term Loan with respect to an Unreimbursed Drawing thereunder and
such statement shall not affect the Borrower’s reimbursement obligations hereunder with
respect to such Credit-Linked Letter of Credit and its repayment obligations hereunder with
respect to such Term Loan.

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     (i) Existing Letters of Credit. Each Existing Letter of Credit shall be deemed
for all purposes of this Agreement and the other Credit Documents to be a Credit-Linked
Letter of Credit. The Borrower’s reimbursement obligations in respect of each Existing
Letter of Credit, and each Credit-Linked Lender’s Participation Interests therein, shall be
governed by the terms of this Credit Agreement.

     (j) Credit-Linked Note. The Borrower’s reimbursement obligations with respect
to the Credit-Linked Letters of Credit issued pursuant to this Section 2.5 shall be
evidenced by a Credit-Linked Note made payable to the Credit-Linked Issuing Lender in
substantially the form of Schedule 2.5(j).

     (k) Credit-Linked Interest. In consideration of the Credit-Linked LOC
Commitment and the Credit-Linked Participations, the Borrower agrees to pay to the
Administrative Agent, for the ratable benefit of the Credit-Linked Lenders, interest (the
“Credit-Linked Interest”) in an amount equal to the sum of (i) the Applicable
Percentage for Term Loans that are LIBOR Rate Loans plus (ii) the Shortfall Amount per annum
on the average daily Credit-Linked LOC Committed Amount. The Credit-Linked Interest shall
be payable at the end of each LIBOR period used to determine the Shortfall Amount.

     Section 2.6 Credit-Linked Deposits.

     (a) Funding of Credit-Linked Deposits. Subject to the terms and conditions set
forth herein and in consideration of each Credit-Linked Lender’s Credit-Linked
Participation, each Credit-Linked Lender severally agrees to fund such Lender’s
Credit-Linked Deposit to the Administrative Agent in Dollars on the Closing Date in an
amount equal to its Credit-Linked Commitment for deposit by the Administrative Agent in the
Credit-Linked Account. Each Credit-Linked Lender’s Credit-Linked Deposit represents such
Lender’s funded Credit-Linked Participation.

     (b) Purpose of Credit-Linked Deposits. The Credit-Linked Deposits will be held
by the Administrative Agent in its name in the Credit-Linked Account, on behalf of the
Credit-Linked Lenders and for the benefit of the Credit-Linked Issuing Lender. The
Credit-Linked Account will be under the sole dominion and control of the Administrative
Agent and no Person other than the Administrative Agent shall have the right of withdrawal
from the Credit-Linked Account nor any other right or power with respect to the
Credit-Linked Deposits or the Credit-Linked Account. Unless returned to the Credit-Linked
Lenders, the Credit-Linked Deposits shall not be used for any purpose other than funding the
Credit-Linked Participations in the Credit-Linked Letters of Credit without the prior
written consent of each Credit-Linked Issuing Lender.

     (c) Actions of Administrative Agent. In charging the Credit-Linked Account or
otherwise exercising any rights of set-off with respect thereto, the Administrative Agent
acts as the agent of the Credit-Linked Issuing Lender.

55

 

     (d) Grant of Security Interest in Credit-Linked Account. The Administrative
Agent hereby grants, and the Credit-Linked Lenders hereby grant and hereby authorize the
Administrative Agent to grant, to the Credit-Linked Issuing Lender, a security interest in
and Lien on the Credit-Linked Account, the Credit-Linked Deposits and all cash, Cash
Equivalents or other amounts or investments from time to time in the Credit-Linked Account.
The foregoing security interest and Lien shall secure the obligations of the Credit-Linked
Lenders to fund their Credit-Linked Participation Interests in any Unreimbursed Drawing by
paying the Credit-Linked Issuing Lender for such Unreimbursed Drawing. Each of the
Administrative Agent and the Credit-Linked Lenders agree to execute such agreements and
documents and take such actions as may be reasonably required by the Credit-Linked Issuing
Lender to perfect and protect the foregoing security interest and Lien.

     (e) Investment of Credit-Linked Deposits. Pending the use of the Credit-Linked
Deposits to fund the Credit-Linked Lenders’ Credit-Linked Participation Interests in
Unreimbursed Drawings under the Credit-Linked Letters of Credit, the Administrative Agent
will invest such Credit-Linked Deposits and will pay to Credit-Linked Lenders in arrears on
the last Business Day of each calendar quarter any return on such investment during the
previous calendar quarter up to an amount not to exceed LIBOR as of the last Business Day of
such previous calendar quarter.

     (f) Reduction of Credit-Linked Deposit. If any Credit-Linked Purchase is made
with proceeds of the Credit-Linked Deposits, the Credit-Linked Deposits shall be
automatically permanently reduced by the amount of such Credit-Linked Purchase. If the
Borrower elects to reduce the Credit-Linked LOC Committed Amount pursuant to Section 2.8(a),
the Credit-Linked Deposit shall be automatically permanently reduced by a corresponding
amount and the amount of such reduction shall be returned to the Credit-Linked Lenders on a
pro rata basis by the Administrative Agent.

     Section 2.7 Fees.

     (a) Revolving Commitment Fee. In consideration of the Revolving Commitments,
the Borrower agrees to pay to the Administrative Agent, for the ratable benefit of the
Revolving Lenders, a commitment fee (the “Revolving Commitment Fee”) in an amount
equal to the Applicable Percentage per annum on the average daily unused amount of the
Revolving Committed Amount. For purposes of computation of the Revolving Commitment Fee,
Revolving LOC Obligations shall be considered usage but Swingline Loans shall not be
considered usage of the Revolving Committed Amount.

     (b) Revolving LOC Fees. In consideration of the Revolving LOC Commitments, the
Borrower agrees to pay to the Administrative Agent, for the ratable benefit of the Revolving
Lenders, a fee (the “Revolving LOC Commitment Fee”) equal to the Applicable
Percentage for Revolving Loans that are LIBOR Rate Loans per annum on the average daily
maximum amount available to be drawn under each Revolving Letter of Credit from the date of
issuance to the date of expiration. In addition to such Revolving LOC Commitment Fee, the
Borrower agrees to pay to the Revolving Issuing

56

 

Lender, for its own account without sharing by the Revolving Lenders, an additional fronting
fee (the “Revolving LOC Fronting Fee”) of one-quarter of one percent (0.25%) per
annum on the average daily maximum amount available to be drawn under each Revolving Letter
of Credit issued by it.

     (c) Credit-Linked LOC Fronting Fees. The Borrower agrees to pay to the
Credit-Linked Issuing Lender, for its own account without sharing by the Credit-Linked
Lenders, a fronting fee (the “Credit-Linked LOC Fronting Fee”) of one-tenth of one
percent (0.10%) per annum on the average daily maximum amount available to be drawn under
each Credit-Linked Letter of Credit (other than an Existing Letter of Credit) issued by it.
The Credit-Linked LOC Fronting Fee shall be payable at the time of issuance and of renewal
of the applicable Credit-Linked Letter of Credit.

     (d) Issuing Lender Fees. In addition to the Revolving LOC Fronting Fees and
the Credit-Linked LOC Fronting Fees payable pursuant to this Section, the Borrower shall pay
to the Issuing Lender for its own account without sharing by the other Lenders the
reasonable and customary charges from time to time of the Issuing Lender with respect to the
amendment, transfer, administration, cancellation and conversion of, and drawings under, the
Letters of Credit (collectively, the “Issuing Lender Fees”).

     (e) Administrative Fee. The Borrower agrees to pay to the Administrative Agent
the annual administrative fee as described in the Fee Letter.

     (f) Payment of Fees. The Revolving Commitment Fees, Revolving LOC Commitment
Fees, Revolving LOC Fronting Fees and Issuing Lender Fees shall each be payable quarterly in
arrears on the last Business Day of each calendar quarter.

     Section 2.8 Commitment Reductions.

     (a) Voluntary Reductions. The Borrower shall have the right to terminate or
permanently reduce the unused portion of the Revolving Committed Amount and the
Credit-Linked LOC Committed Amount at any time or from time to time upon not less than five
(5) Business Days’ prior written notice to the Administrative Agent (which shall notify the
Lenders thereof as soon as practicable) of each such termination or reduction, which notice
shall specify the effective date thereof and the amount of any such reduction which shall be
in a minimum amount of $2,000,000 or a whole multiple of $1,000,000 in excess thereof and
shall be irrevocable and effective upon receipt by the Administrative Agent;
provided that (i) no such reduction or termination of the Revolving Committed Amount
shall be permitted if after giving effect thereto, and to any prepayments of the Revolving
Loans made on the effective date thereof, the sum of the aggregate principal amount of
outstanding Revolving Loans plus outstanding Swingline Loans plus
outstanding Revolving LOC Obligations would exceed the Revolving Committed Amount then in
effect and (ii) no such reduction or termination of the Credit-Linked LOC Committed Amount
shall be permitted if after giving effect thereto, the outstanding Credit-Linked LOC
Obligations would exceed the Credit-Linked LOC Committed Amount then in effect or the
Credit-Linked Deposits at such time.

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     (b) Maturity Date. The Revolving Commitments, the LOC Commitments and the
Swingline Commitment shall automatically terminate on the Revolving Commitment Termination
Date. The Term Loan Commitment and the Credit-Linked LOC Commitment shall automatically
terminate on the Credit-Linked Maturity Date.

     Section 2.9 Prepayments.

     (a) Optional Prepayments. The Borrower shall have the right to prepay the
Revolving Loans and the Term Loans in whole or in part from time to time as the Borrower may
elect; provided, however, that (i) each partial prepayment of Term Loans
shall be in a minimum principal amount of $1,000,000 and integral multiples of $100,000 in
excess thereof and (ii) each voluntary prepayment of the Term Loan shall be applied to the
remaining amortization payments thereof on a pro rata basis. The Borrower shall give at
least three (3) Business Days’ (but not more than five (5) Business Days’) irrevocable
notice in the case of LIBOR Rate Loans and at least one (1) Business Day’s (but not more
than five (5) Business Days’) irrevocable notice in the case of Alternate Base Rate Loans,
to the Administrative Agent (which shall notify the Lenders thereof as soon as practicable).
Subject to the foregoing terms, amounts prepaid under this Section 2.9(a) shall be applied
first to Alternate Base Rate Loans and then to LIBOR Rate Loans in direct order of Interest
Period maturities. All prepayments under this Section 2.9(a) shall be subject to Section
2.18, but otherwise without premium or penalty. Interest on the principal amount prepaid
shall be due and payable on any date that a prepayment is made hereunder through the date of
prepayment.

     (b) Mandatory Prepayments.

     (i) (A) Revolving Committed Amount. If at any
time after the Closing Date, the sum of
the aggregate principal amount of
outstanding Revolving Loans plus
outstanding Swingline Loans plus
outstanding Revolving LOC Obligations
shall exceed the Revolving Committed
Amount then in effect, the Borrower
immediately shall prepay the Revolving
Loans and Swingline Loans and (after all
Revolving Loans and Swingline Loans have
been repaid) cash collateralize the
Revolving LOC Obligations in an amount
sufficient to eliminate such excess.

     (B) Credit-Linked LOC Committed Amount. If at any time after
the Closing Date, the aggregate amount of Credit-Linked LOC Obligations
shall exceed the lesser of (1) the Credit-Linked LOC Committed Amount and
(2) the principal amount of the Credit-Linked Deposit, the Borrower
immediately shall cash collateralize the Credit-Linked LOC Obligations in
the amount of such excess.

     (ii) Excess Cash Flow. Within one hundred ten (110) days after the end
of each fiscal year (commencing with the fiscal year ending November 30, 2008), if
the Borrower’s Leverage Ratio as of the end of such fiscal year is (i)

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greater than 3.0 to 1.0, the Borrower shall prepay the Loans in an aggregate amount
equal to 50% of the Excess Cash Flow for such fiscal year and (b) less than or equal
to 3.0 to 1.0, then no annual Excess Cash Flow prepayment shall be required. Any
payments of Excess Cash Flow shall be applied as set forth in clause (x) below.

     (iii) Asset Dispositions. Promptly following any Asset Disposition (or
related series of Asset Dispositions), the Borrower shall prepay the Loans in an
aggregate amount equal to the Net Cash Proceeds derived from such Asset Disposition
(or related series of Asset Dispositions) (such prepayment to be applied as set
forth in clause (x) below); provided that (I) the Net Cash Proceeds from
Asset Dispositions in any fiscal year shall not be required to be so applied until
the aggregate amount of such Net Cash Proceeds is equal to or greater than
$1,000,000 for such fiscal year and (II) the Borrower shall be permitted to reinvest
up to $10,000,000 of Net Cash Proceeds received from Asset Dispositions pursuant to
clause (A) above in the aggregate in fixed or capital assets so long as (x) no
Default or Event of Default shall have occurred and be continuing at the time of
such Asset Disposition and at the time of such reinvestment, (y) before or promptly
after such Asset Disposition, the Borrower delivers to the Administrative Agent a
certificate stating that such Net Cash Proceeds will be reinvested in accordance
with the terms of this Section 2.8(b)(iii) and (z) such reinvestments occurs within
365 days of the receipt of such Net Cash Proceeds.

     (iv) Permitted Real Estate Sales. Promptly following any Permitted
Real Estate Sale or Permitted Real Estate Transfer by a Credit Party (other than a
Permitted Real Estate Entity), the Borrower shall prepay the Loans in an aggregate
amount equal to 50% of the Net Cash Proceeds derived from such Permitted Real Estate
Sale or Permitted Real Estate Transfer (such prepayment to be applied as set forth
in clause (x) below); provided that the Net Cash Proceeds from Permitted
Real Estate Sales and Permitted Real Estate Transfers in any fiscal year shall not
be required to be so applied until the aggregate amount of such Net Cash Proceeds is
equal to or greater than $2,500,000 for such fiscal year.

     (v) Debt Issuances. Promptly, upon receipt by any Credit Party or any
of its Subsidiaries of proceeds from any Debt Issuance, the Borrower shall prepay
the Loans in an aggregate amount equal to 100% of the Net Cash Proceeds of such Debt
Issuance (such prepayment to be applied as set forth in clause (x) below).

     (vi) Issuances of Equity. Promptly, upon receipt by any Credit Party
or any of its Subsidiaries of proceeds from any Equity Issuance, the Borrower shall
prepay the Loans in an aggregate amount equal to 50% of the Net Cash Proceeds of
such Equity Issuance (such prepayment to be applied as set forth in clause (x)
below).

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     (vii) Recovery Event. To the extent Net Cash Proceeds received in
connection with any Recovery Event are not used to acquire fixed or capital assets
in replacement of the assets subject to such Recovery Event within 365 days of the
receipt of such Net Cash Proceeds, immediately following the 365th day occurring
after the receipt of such Net Cash Proceeds, the Borrower shall prepay the Loans in
an aggregate amount equal to 100% of such Net Cash Proceeds (such prepayment to be
applied as set forth in clause (x) below); provided that (A) the Net Cash
Proceeds from Recovery Events in any fiscal year shall not be required to be so
applied until the aggregate amount of such Net Cash Proceeds is equal to or greater
than $1,000,000 for such fiscal year, (B) after the occurrence and during the
continuation of a Default, any Net Cash Proceeds shall be delivered to the
Administrative Agent in escrow until the earlier of (I) the cure of such Default at
which time the Net Cash Proceeds shall be used by the Borrower as set forth herein
and (II) the occurrence of an Event of Default at which time the Net Cash Proceeds
shall be used to prepay the Loans as set forth herein and (C) after the occurrence
and during the continuance of an Event of Default, any Net Cash Proceeds received in
connection with any Recovery Event shall be promptly used to prepay the Loans (such
prepayment to be applied as set forth in clause (x) below) and the Borrower and its
Subsidiaries shall not have the right to reinvest such Net Cash Proceeds.

     (viii) Litigation Award. To the extent Net Cash Proceeds received in
connection with any Litigation Award are not reinvested in the business of the
Credit Parties within 365 days of the receipt of such Net Cash Proceeds, immediately
following the 365th day occurring after the receipt of such Net Cash Proceeds, the
Borrower shall prepay the Loans in an aggregate amount equal to one 100% of such Net
Cash Proceeds (such prepayment to be applied as set forth in clause (ix) below);
provided that (A) the Net Cash Proceeds from any Litigation Award in any
fiscal year shall not be required to be so applied until the aggregate amount of
such Net Cash Proceeds is equal to or greater than $1,000,000 for such fiscal year,
(B) after the occurrence and during the continuation of a Default, any Net Cash
Proceeds shall be delivered to the Administrative Agent in escrow until the earlier
of (I) the cure of such Default at which time the Net Cash Proceeds shall be used by
the Borrower as set forth herein and (II) the occurrence of an Event of Default at
which time the Net Cash Proceeds shall be used to prepay the Loans as set forth
herein and (C) after the occurrence and during the continuance of an Event of
Default, any Net Cash Proceeds received in connection with any Litigation Award
shall be promptly used to prepay the Loans (such prepayment to be applied as set
forth in clause (x) below) and the Borrower and its Subsidiaries shall not have the
right to reinvest such Net Cash Proceeds.

     (ix) Permitted Real Estate Entity Distribution. Promptly, upon receipt
by any Credit Party or any of its Subsidiaries of proceeds from any Permitted Real
Estate Entity Distribution, the Borrower shall prepay the Loans in an aggregate
amount equal to 50% of the Net Cash Proceeds of such Permitted Real Estate

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Entity Distribution (such prepayment to be applied as set forth in clause (x)
below).

     (x) Application of Mandatory Prepayments. All amounts required to be
paid pursuant to this Section 2.9(b) shall be applied as follows:

     (A) with respect to all amounts prepaid pursuant to Section 2.9(b)(i),
(1) first to the outstanding Swingline Loans, (2) second to
the outstanding Revolving Loans and (3) third to a cash collateral
account in respect of Revolving LOC Obligations; and

     (B) with respect to all amounts prepaid pursuant to Sections 2.9(b)(ii)
through (viii), (1) first to the Term Loans (pro rata to the
remaining amortization payments set forth in Section 2.4(b)), (2)
second to outstanding Swingline Loans (without a corresponding
permanent reduction in the Revolving Committed Amount), (3) third to
the outstanding Revolving Loans (without a corresponding permanent reduction
in the Revolving Committed Amount) and (4) fourth any remaining
amounts shall be paid to the Borrower. Within the parameters of the
applications set forth above, prepayments shall be applied first to
Alternate Base Rate Loans and then to LIBOR Rate Loans in direct order of
Interest Period maturities. All prepayments under this Section 2.9(b) shall
be subject to Section 2.18 and be accompanied by interest on the principal
amount prepaid through the date of prepayment.

     (c) Hedging Obligations Unaffected. Any repayment or prepayment made pursuant
to this Section 2.9 shall not affect the Borrower’s obligation to continue to make payments
under any Secured Hedging Agreement, which shall remain in full force and effect
notwithstanding such repayment or prepayment, subject to the terms of such Secured Hedging
Agreement.

     Section 2.10 Default Rate and Payment Dates.

     (a) If all or a portion of the principal amount of any Loan which is a LIBOR Rate Loan
shall not be paid when due or continued as a LIBOR Rate Loan in accordance with the
provisions of Section 2.11 (whether at the stated maturity, by acceleration or otherwise),
such overdue principal amount of such Loan shall be converted to an Alternate Base Rate Loan
at the end of the Interest Period applicable thereto.

     (b) Upon the occurrence, and during the continuance, of an Event of Default, at the
election of the Required Lenders, the principal of and, to the extent permitted by law,
interest on the Loans and any other amounts owing hereunder or under the other Credit
Documents shall bear interest, payable on demand (and monthly if demand is not made), at a
per annum rate 2% greater than the rate which would otherwise be applicable (or if no rate
is applicable, whether in respect of interest, fees or other amounts, then the ABR Default
Rate).

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     (c) Interest on each Loan shall be payable in arrears on each Interest Payment Date;
provided that interest accruing pursuant to Section 2.10(b) shall be payable from
time to time on demand.

     Section 2.11 Conversion Options.

     (a) The Borrower may, in the case of Revolving Loans and the Term Loans, elect from
time to time to convert Alternate Base Rate Loans to LIBOR Rate Loans by giving the
Administrative Agent at least three (3) Business Days’ prior irrevocable written notice of
such election, such notice to be in substantially the form of the notice of conversion
attached hereto as Schedule 2.11 (a “Notice of Conversion”). In addition,
the Borrower may elect from time to time to convert LIBOR Rate Loans to Alternate Base Rate
Loans by delivering an irrevocable Notice of Conversion to the Administrative Agent by 1:00
P.M. one Business Date prior to the proposed date of conversion. If the date upon which an
Alternate Base Rate Loan is to be converted to a LIBOR Rate Loan is not a Business Day, then
such conversion shall be made on the next succeeding Business Day. All or any part of
outstanding Alternate Base Rate Loans may be converted as provided herein; provided
that (i) no Loan may be converted into a LIBOR Rate Loan when any Default or Event of
Default has occurred and is continuing and (ii) partial conversions shall be in an aggregate
principal amount of $2,000,000 or a whole multiple of $1,000,000 in excess thereof. LIBOR
Rate Loans may only be converted to Alternate Base Rate Loans on the last day of the
applicable Interest Period. If the date upon which a LIBOR Rate Loan is to be converted to
an Alternate Base Rate Loan is not a Business Day, then such conversion shall be made on the
next succeeding Business Day and during the period from such last day of an Interest Period
to such succeeding Business Day such Loan shall bear interest as if it were an Alternate
Base Rate Loan.

     (b) Any LIBOR Rate Loans may be continued as such upon the expiration of an Interest
Period with respect thereto by compliance by the Borrower with the notice provisions
contained in Section 2.12(a); provided, that no LIBOR Rate Loan may be continued as
such when any Default or Event of Default has occurred and is continuing, in which case such
Loan shall be automatically converted to an Alternate Base Rate Loan at the end of the
applicable Interest Period with respect thereto. If the Borrower shall fail to give timely
notice of an election to continue a LIBOR Rate Loan, or the continuation of LIBOR Rate Loans
is not permitted hereunder, such LIBOR Rate Loans shall be automatically converted to
Alternate Base Rate Loans at the end of the applicable Interest Period with respect thereto.

     Section 2.12 Computation of Interest and Fees.

     (a) Interest payable hereunder with respect to any Alternate Base Rate Loan based on
the Prime Rate shall be calculated on the basis of a year of 365 days (or 366 days, as
applicable) for the actual days elapsed. All fees, interest and all other amounts payable
hereunder shall be calculated on the basis of a 360 day year for the actual days elapsed.
The Administrative Agent shall as soon as practicable notify the Borrower and

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the Lenders of each determination of a LIBOR Rate on the Business Day of the determination
thereof. Any change in the interest rate on a Loan resulting from a change in the Alternate
Base Rate shall become effective as of the opening of business on the day on which such
change in the Alternate Base Rate shall become effective. The Administrative Agent shall as
soon as practicable notify the Borrower and the Lenders of the effective date and the amount
of each such change.

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

     (c) It is the intent of the Lenders and the Credit Parties to conform to and contract
in strict compliance with applicable usury law from time to time in effect. All agreements
between the Lenders and the Credit Parties are hereby limited by the provisions of this
paragraph which shall override and control all such agreements, whether now existing or
hereafter arising and whether written or oral. In no way, nor in any event or contingency
(including but not limited to prepayment or acceleration of the maturity of any Obligation),
shall the interest taken, reserved, contracted for, charged, or received under this Credit
Agreement, under the Notes or otherwise, exceed the maximum nonusurious amount permissible
under applicable law. If, from any possible construction of any of the Credit Documents or
any other document, interest would otherwise be payable in excess of the maximum nonusurious
amount, any such construction shall be subject to the provisions of this paragraph and such
interest shall be automatically reduced to the maximum nonusurious amount permitted under
applicable law, without the necessity of execution of any amendment or new document. If any
Lender shall ever receive anything of value which is characterized as interest on the Loans
under applicable law and which would, apart from this provision, be in excess of the maximum
nonusurious amount, an amount equal to the amount which would have been excessive interest
shall, without penalty, be applied to the reduction of the principal amount owing on the
Loans and not to the payment of interest, or refunded to the Borrower or the other payor
thereof if and to the extent such amount which would have been excessive exceeds such unpaid
principal amount of the Loans. The right to demand payment of the Loans or any other
Indebtedness evidenced by any of the Credit Documents does not include the right to receive
any interest which has not otherwise accrued on the date of such demand, and the Lenders do
not intend to charge or receive any unearned interest in the event of such demand. All
interest paid or agreed to be paid to the Lenders with respect to the Loans shall, to the
extent permitted by applicable law, be amortized, prorated, allocated, and spread throughout
the full stated term (including any renewal or extension) of the Loans so that the amount of
interest on account of such indebtedness does not exceed the maximum nonusurious amount
permitted by applicable law.

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     Section 2.13 Pro Rata Treatment and Payments.

     (a) Allocation of Payments Before Exercise of Remedies. Each borrowing of
Revolving Loans and any reduction of the Revolving Commitments shall be made pro
rata according to the respective Revolving Commitment Percentages of the Revolving
Lenders. Each borrowing of a Term Loan by conversion of a Credit-Linked LOC Advance to a
Term Loan and any reduction of the Credit-Linked Commitments shall be made pro
rata according to the respective Credit-Linked Commitment Percentages of the
Credit-Linked Lenders. Unless otherwise indicated herein, each payment under this Credit
Agreement or any Note shall be applied, first, to any fees then due and owing by the
Borrower pursuant to Section 2.7, second, to interest then due and owing hereunder
and under the Notes and, third, to principal then due and owing hereunder and under
the Notes. Each payment on account of any fees pursuant to Section 2.7 shall be made
pro rata in accordance with the respective amounts due and owing (except as
to the Revolving LOC Fronting Fees, the Credit-Linked LOC Fronting Fees and the Issuing
Lender Fees, which fees shall be for the account of the applicable Issuing Lender). Each
voluntary prepayment on account of principal of the Loans shall be applied in accordance
with the terms of Section 2.9(a). Each mandatory prepayment on account of principal of the
Loans shall be applied in accordance with Section 2.9(b). All payments (including
prepayments) to be made by the Borrower on account of principal, interest and fees shall be
made without defense, set-off or counterclaim (except as provided in Section 2.19(b)) and
shall be made to the Administrative Agent for the account of the Lenders, the Issuing
Lenders or the Swingline Lender, as the case may be, at the Administrative Agent’s office
specified on Section 9.2 in Dollars and in immediately available funds not later than 1:00
P.M. on the date when due. The Administrative Agent shall distribute such payments to the
Lenders entitled thereto promptly upon receipt in like funds as received. If any payment
hereunder (other than payments on the LIBOR Rate Loans) becomes due and payable on a day
other than a Business Day, such payment shall be extended to the next succeeding Business
Day, and, with respect to payments of principal, interest thereon shall be payable at the
then applicable rate during such extension. If any payment on a LIBOR Rate 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.

     (b) Allocation of Payments After Exercise of Remedies. Notwithstanding any
other provisions of this Agreement to the contrary, after the exercise of remedies (other
than the invocation of default interest pursuant to Section 2.10(b)) by the Administrative
Agent or the Lenders pursuant to Section 7.2 (or after the Commitments shall automatically
terminate and the Loans (with accrued interest thereon) and all other amounts under the
Credit Documents shall automatically become due and payable in accordance with the terms of
such Section), all amounts collected or received by the Administrative Agent or any Lender
on account of the Credit Party Obligations or in respect of the Collateral shall be paid
over or delivered as follows (irrespective of whether the following costs, expenses, fees,
interest, premiums, scheduled periodic

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payments or Credit Party Obligations are allowed, permitted or recognized as a claim in any
proceeding resulting from the occurrence of a Bankruptcy Event):

     FIRST, to the payment of all reasonable out-of-pocket costs and expenses
(including without limitation reasonable attorneys’ fees) of the Administrative
Agent and the Issuing Lenders in connection with enforcing the rights of the Lenders
under the Credit Documents and any protective advances made by the Administrative
Agent with respect to the Collateral under or pursuant to the terms of the Security
Documents;

     SECOND, to the payment of any fees owed to the Administrative Agent and the
Issuing Lenders;

     THIRD, to the payment of all reasonable out-of-pocket costs and expenses
(including without limitation, reasonable attorneys’ fees) of each of the Lenders in
connection with enforcing its rights under the Credit Documents or otherwise
enforcing its rights with respect to the Credit Party Obligations owing to such
Lender;

     FOURTH, to the payment of all of the Credit Party Obligations consisting of
accrued fees and interest, including, with respect to any Secured Hedging Agreement,
any fees, premiums and scheduled periodic payments due under such Secured Hedging
Agreement and any interest accrued thereon;

     FIFTH, to the payment of the outstanding principal amount of the Credit Party
Obligations, including the payment or cash collateralization of the outstanding LOC
Obligations and, with respect to any Secured Hedging Agreement, any breakage,
termination or other payments due under such Secured Hedging Agreement and any
interest accrued thereon;

     SIXTH, to all other Credit Party Obligations and other obligations which shall
have become due and payable under the Credit Documents or otherwise and not repaid
pursuant to clauses “FIRST” through “FIFTH” above; and

     SEVENTH, to the payment of the surplus, if any, to whoever may be lawfully
entitled to receive such surplus.

     In carrying out the foregoing, (i) amounts received shall be applied in the numerical
order provided until exhausted prior to application to the next succeeding category; (ii)
each of the Secured Parties shall receive an amount equal to its pro rata share (based on
the proportion that the then outstanding Loans and LOC Obligations held by such Lender or
the outstanding obligations payable to such Hedging Agreement Provider bears to the
aggregate then outstanding Loans, LOC Obligations and obligations payable under all Secured
Hedging Agreements) of amounts available to be applied pursuant to clauses “THIRD”,
“FOURTH”, “FIFTH” AND “SIXTH” above; and (iii) to the extent that any amounts available for
distribution pursuant to clause “FIFTH” above

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are attributable to the issued but undrawn amount of outstanding Letters of Credit, such
amounts shall be held by the Administrative Agent in a cash collateral account and applied
to reimburse the Issuing Lender from time to time for any drawings under such Letters of
Credit. Notwithstanding the foregoing terms of this Section 2.13(b), only Collateral
proceeds and payments under the Guaranty with respect to Secured Hedging Agreements (as
opposed to ordinary course principal, interest and fee payments hereunder) shall be applied
to obligations under any Secured Hedging Agreement.

     Section 2.14 Non-Receipt of Funds by the Administrative Agent.

     (a) Funding by Lenders; Presumption by Administrative Agent. Unless the
Administrative Agent shall have received written notice from a Lender prior to the proposed
date of any Extension of Credit that such Lender will not make available to the
Administrative Agent such Lender’s share of such Extension of Credit, the Administrative
Agent may assume that such Lender has made such share available on such date in accordance
with this Agreement and may, in reliance upon such assumption, make available to the
Borrower a corresponding amount. In such event, if a Lender has not in fact made its share
of the applicable Extension of Credit available to the Administrative Agent, then the
applicable Lender and the Borrower severally agree to pay to the Administrative Agent
forthwith on demand such corresponding amount with interest thereon, for each day from and
including the date such amount is made available to the Borrower to but excluding the date
of payment to the Administrative Agent, at (i) in the case of a payment to be made by such
Lender, the greater of the Federal Funds Effective Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank compensation and
(ii) in the case of a payment to be made by the Borrower, the applicable rate for the
applicable borrowing pursuant to the Notice of Borrowing. If the Borrower and such Lender
shall pay such interest to the Administrative Agent for the same or an overlapping period,
the Administrative Agent shall promptly remit to the Borrower the amount of such interest
paid by the Borrower for such period. If such Lender pays its share of the applicable
Extension of Credit to the Administrative Agent, then the amount so paid shall constitute
such Lender’s Loan included in such Extension of Credit. Any payment by the Borrower shall
be without prejudice to any claim the Borrower may have against a Lender that shall have
failed to make such payment to the Administrative Agent.

     (b) Payments by Borrower; Presumptions by Administrative Agent. Unless the
Administrative Agent shall have received notice from the Borrower prior to the date on which
any payment is due to the Administrative Agent for the account of the Lenders or the Issuing
Lender hereunder that the Borrower will not make such payment, the Administrative Agent may
assume that the Borrower has made such payment on such date in accordance herewith and may,
in reliance upon such assumption, distribute to the Lenders or the Issuing Lender, as the
case may be, the amount due. In such event, if the Borrower has not in fact made such
payment, then each of the Lenders or the Issuing Lender, as the case may be, severally
agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to
such Lender or the Issuing Lender, with interest thereon, for each day from and including
the date such amount is distributed

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to it to but excluding the date of payment to the Administrative Agent, at the greater
of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in
accordance with banking industry rules on interbank compensation.

     A notice of the Administrative Agent to any Lender or the Borrower with respect to any
amount owing under subsections (a) and (b) of this Section shall be conclusive, absent
manifest error.

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

     (d) Obligations of Lenders Several. The obligations of the Lenders hereunder
to make Term Loans and Revolving Loans, to fund participations in Letters of Credit and
Swingline Loans and to make payments pursuant to Section 9.5(c) are several and not joint.
The failure of any Lender to make any Loan, to fund any such participation or to make any
such payment under Section 9.5(c) on any date required hereunder shall not relieve any other
Lender of its corresponding obligation to do so on such date, and no Lender shall be
responsible for the failure of any other Lender to so make its Loan, to purchase its
participation or to make its payment under Section 9.5(c).

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

     Section 2.15 Inability to Determine Interest Rate.

     Notwithstanding any other provision of this Credit Agreement, if (i) the Administrative Agent
shall reasonably determine (which determination shall be conclusive and binding absent manifest
error) that, by reason of circumstances affecting the relevant market, reasonable and adequate
means do not exist for ascertaining LIBOR for such Interest Period, or (ii) the Required Lenders
shall reasonably determine (which determination shall be conclusive and binding absent manifest
error) that the LIBOR Rate does not adequately and fairly reflect the cost to such Lenders of
funding LIBOR Rate Loans that the Borrower has requested be outstanding as a LIBOR Tranche during
such Interest Period, the Administrative Agent shall forthwith give telephone notice of such
determination, confirmed in writing, to the Borrower, and the Lenders at least two (2) Business
Days prior to the first day of such Interest Period. Unless the Borrower shall have notified the
Administrative Agent upon receipt of such telephone notice that it wishes to rescind or modify its
request regarding such LIBOR Rate Loans, any Loans that were requested to be made as LIBOR Rate
Loans shall be made as Alternate Base Rate Loans and any Loans that were requested to be converted
into or continued as LIBOR Rate Loans shall remain

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as or be converted into Alternate Base Rate Loans. Until any such notice has been withdrawn by the
Administrative Agent, no further Loans shall be made as, continued as, or converted into, LIBOR
Rate Loans for the Interest Periods so affected.

     Section 2.16 Illegality.

     Notwithstanding any other provision of this Credit Agreement, if any Change in Law shall make
it unlawful for such Lender or its LIBOR Lending Office to make or maintain LIBOR Rate Loans as
contemplated by this Credit Agreement or to obtain in the interbank eurodollar market through its
LIBOR Lending Office the funds with which to make such Loans, (a) such Lender shall promptly notify
the Administrative Agent and the Borrower thereof, (b) the commitment of such Lender hereunder to
make LIBOR Rate Loans or continue LIBOR Rate Loans as such shall forthwith be suspended until the
Administrative Agent shall give notice that the condition or situation which gave rise to the
suspension shall no longer exist, and (c) such Lender’s Loans then outstanding as LIBOR Rate Loans,
if any, shall be converted on the last day of the Interest Period for such Loans or within such
earlier period as required by law as Alternate Base Rate Loans. The Borrower hereby agrees to
promptly pay any Lender, upon its demand, any additional amounts necessary to compensate such
Lender for actual and direct costs (but not including anticipated profits) reasonably incurred by
such Lender in making any repayment in accordance with this Section including, but not limited to,
any interest or fees payable by such Lender to lenders of funds obtained by it in order to make or
maintain its LIBOR Rate Loans hereunder. A certificate (which certificate shall include a
description of the basis for the computation) as to any additional amounts payable pursuant to this
Section submitted by such Lender, through the Administrative Agent, to the Borrower shall be
conclusive in the absence of manifest error. Each Lender agrees to use reasonable efforts
(including reasonable efforts to change its LIBOR Lending Office) to avoid or to minimize any
amounts which may otherwise be payable pursuant to this Section; provided, however,
that such efforts shall not cause the imposition on such Lender of any additional costs or legal or
regulatory burdens deemed by such Lender in its sole discretion to be material.

     Section 2.17 Yield Protection.

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

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

     (ii) subject any Lender or Issuing Lender to any tax of any kind whatsoever
with respect to this Agreement, any Letter of Credit, any participation in a Letter
of Credit or any LIBOR Rate Loan made by it, or change the basis of taxation of
payments to such Lender or Issuing Lender in respect thereof (except for Indemnified
Taxes or Other Taxes covered by Section 2.19 and the imposition

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of, or any change in the rate of, any Excluded Tax payable by such Lender or
Issuing Lender); or

     (iii) impose on any Lender or Issuing Lender or the London interbank market any
other condition, cost or expense affecting this Agreement or LIBOR Rate Loans made
by such Lender or any Letter of Credit or participation therein;

and the result of any of the foregoing shall be to increase the cost to such Lender of
making or maintaining any LIBOR Rate Loan (or of maintaining its obligation to make any such
Loan), or to increase the cost to such Lender or Issuing Lender of participating in, issuing
or maintaining any Letter of Credit (or of maintaining its obligation to participate in or
to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by
such Lender or Issuing Lender hereunder (whether of principal, interest or any other amount)
then, upon request of such Lender or Issuing Lender, the Borrower will pay to such Lender or
Issuing Lender, as the case may be, such additional amount or amounts as will compensate
such Lender or Issuing Lender, as the case may be, for such additional costs incurred or
reduction suffered. Each Lender agrees to use reasonable efforts (including reasonable
efforts to change its Domestic Lending Office or LIBOR Lending Office, as the case may be)
to avoid or to minimize any amounts which might otherwise be payable pursuant to this
paragraph of this Section; provided, however, that such efforts shall not
cause the imposition on such Lender of any additional costs or legal or regulatory burdens
deemed by such Lender to be material.

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

     (c) Certificates for Reimbursement. A certificate of a Lender or Issuing
Lender setting forth the amount or amounts necessary to compensate such Lender or Issuing
Lender or its holding company, as the case may be, as specified in paragraph (a) or (b) of
this Section and delivered to the Borrower shall be conclusive absent manifest error. The
Borrower shall pay such Lender or Issuing Lender, as the case may be, the amount shown as
due on any such certificate within fifteen (15) days after receipt thereof.

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     (d) Delay in Requests. Failure or delay on the part of any Lender or Issuing
Lender to demand compensation pursuant to this Section shall not constitute a waiver of such
Lender’s or Issuing Lender’s right to demand such compensation.

     Section 2.18 Indemnity.

     The Borrower hereby agrees to indemnify each Lender and to hold such Lender harmless from any
funding loss or expense which such Lender may sustain or incur as a consequence of (a) the failure
by the Borrower to pay the principal amount of or interest on any Loan by such Lender in accordance
with the terms hereof, (b) the failure of the Borrower to accept a borrowing after the Borrower has
given a notice in accordance with the terms hereof, (c) the failure of the Borrower to make any
prepayment after the Borrower has given a notice in accordance with the terms hereof, and/or (d)
the making by the Borrower of a prepayment of a Loan, or the conversion thereof, on a day which is
not the last day of the Interest Period with respect thereto, in each case including, but not
limited to, any such loss or expense arising from interest or fees payable by such Lender to
lenders of funds obtained by it in order to maintain its Loans hereunder. A certificate as to any
additional amounts payable pursuant to this Section submitted by any Lender, through the
Administrative Agent, to the Borrower (which certificate must be delivered to the Administrative
Agent within thirty (90) days following such default, prepayment or conversion and shall be
conclusive in the absence of manifest error); provided that if such certificate is not be
delivered to the Administrative Agent within ninety (90) days following such Lender becoming aware
of such default, prepayment or conversion, such Lender shall only be entitled to receive payment
pursuant to this Section with respect to losses or expenses incurred by such Lender during the
ninety (90) days prior to the date such Lender delivers such certificate to the Administrative
Agent. The agreements in this Section shall survive termination of this Credit Agreement and
payment in full of the Credit Party Obligations.

     Section 2.19 Taxes.

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

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

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     (c) Indemnification by the Borrower. The Borrower shall indemnify the
Administrative Agent, each Lender and each Issuing Lender, within fifteen (15) days after
demand therefor, for the full amount of any Indemnified Taxes or Other Taxes (including
Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable
under this Section) paid by the Administrative Agent, such Lender or such Issuing Lender, as
the case may be, and any penalties, interest and reasonable expenses arising therefrom or
with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. A certificate as to the
amount of such payment or liability delivered to the Borrower by a Lender or an Issuing
Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own
behalf or on behalf of a Lender or an Issuing Lender, shall be conclusive absent manifest
error.

     (d) If the Borrower pays any additional amount pursuant to this Section 2.19 with
respect to a Lender, such Lender shall use reasonable efforts to obtain a refund of tax or
credit against its tax liabilities on account of such payment; provided that such
Lender shall have no obligation to use such reasonable efforts if either (i) it is in an
excess foreign tax credit position or (ii) it believes in good faith, in its sole
discretion, that claiming a refund or credit would cause adverse tax consequences to it. In
the event that such Lender receives such a refund or credit, such Lender shall pay to the
Borrower an amount that such Lender reasonably determines is equal to the net tax benefit
obtained by such Lender as a result of such payment by the Borrower. In the event that no
refund or credit is obtained with respect to the Borrower’s payments to such Lender pursuant
to this Section 2.19, then such Lender shall upon request provide a certification that such
Lender has not received a refund or credit for such payments.

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

     (f) Status of Lenders. Any Foreign Lender that is entitled to an exemption
from or reduction of withholding tax under the law of the jurisdiction in which the Borrower
is resident for tax purposes, or any treaty to which such jurisdiction is a party, with
respect to payments hereunder or under any other Credit Document shall deliver to the
Borrower (with a copy to the Administrative Agent), at the time or times prescribed by
applicable law or reasonably requested by the Borrower or the Administrative Agent, 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 of withholding. In
addition, any Lender, if requested by the Borrower or the Administrative Agent, shall
deliver such other documentation prescribed by applicable law or reasonably requested by the
Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent
to determine whether or not such Lender is subject to backup withholding or information
reporting requirements.

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     (g) Foreign Lenders. Without limiting the generality of the foregoing, in the
event that the Borrower is resident for tax purposes in the United States of America, any
Foreign Lender shall deliver to the Borrower and the Administrative Agent (in such number of
copies as shall be requested by the recipient) on or prior to the date on which such Foreign
Lender becomes a Lender under this Agreement (and from time to time thereafter upon the
request of the Borrower or the Administrative Agent, but only if such Foreign Lender is
legally entitled to do so), whichever of the following is applicable:

     (i) duly completed copies of Internal Revenue Service Form W-8BEN claiming
eligibility for benefits of an income tax treaty to which the United States of
America is a party,

     (ii) duly completed copies of Internal Revenue Service Form W-8ECI,

     (iii) in the case of a Foreign Lender claiming the benefits of the exemption
for portfolio interest under section 881(c) of the Code, (i) a certificate to the
effect that such Foreign Lender is not (A) a “bank” within the meaning of section
881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower within the
meaning of section 881(c)(3)(B) of the Code, or (C) a “controlled foreign
corporation” described in section 881(c)(3)(C) of the Code and (ii) duly completed
copies of Internal Revenue Service Form W-8BEN, or

     (iii) any other form prescribed by applicable law as a basis for claiming
exemption from or a reduction in United States Federal withholding tax duly
completed together with such supplementary documentation as may be prescribed by
applicable law to permit the Borrower to determine the withholding or deduction
required to be made.

     (h) Treatment of Certain Refunds. If the Administrative Agent, a Lender or an
Issuing Lender determines, in its reasonable discretion, that it has received a refund of
any Taxes or Other Taxes as to which it has been indemnified by the Borrower or with respect
to which the Borrower has paid additional amounts pursuant to this Section, it shall notify
the Borrower of such refund and pay to the Borrower an amount equal to such refund (but only
to the extent of indemnity payments made, or additional amounts paid, by the Borrower under
this Section with respect to the Taxes or Other Taxes giving rise to such refund), net of
all out-of-pocket expenses of the Administrative Agent, such Lender or such Issuing Lender,
as the case may be, and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund), provided that the Borrower,
upon the request of the Administrative Agent, such Lender or such Issuing Lender, agrees to
repay the amount paid over to the Borrower (plus any penalties, interest or other charges
imposed by the relevant Governmental Authority) to the Administrative Agent, such Lender or
such Issuing Lender in the event the Administrative Agent, such Lender or such Issuing
Lender is required to repay such refund to such Governmental Authority. This paragraph
shall not be construed to require the Administrative Agent, any Lender or any Issuing Lender
to make available its tax

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returns (or any other information relating to its taxes that it deems confidential) to the
Borrower or any other Person.

     Section 2.20 Indemnification; Nature of Issuing Lender’s Duties.

     (a) In addition to its other obligations under Section 2.2 and Section 2.5, the
Borrower hereby agrees to protect, indemnify, pay and save each Issuing Lender and each
Lender harmless from and against any and all claims, demands, liabilities, damages, losses,
costs, charges and expenses (including reasonable attorneys’ fees) that each Issuing Lender
or such Lender may incur or be subject to as a consequence, direct or indirect, of (i) the
issuance of any Letter of Credit or (ii) the failure of such Issuing Lender to honor a
drawing under a Letter of Credit as a result of any act or omission, whether rightful or
wrongful, of any present or future de jure or de facto government or governmental authority
(all such acts or omissions, herein called “Government Acts”).

     (b) As between the Borrower and each Issuing Lender and each Lender, the Borrower shall
assume all risks of the acts, omissions or misuse of any Letter of Credit by the beneficiary
thereof. Neither any Issuing Lender nor any Lender shall be responsible: (i) for the form,
validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by
any party in connection with the application for and issuance of any Letter of Credit, even
if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate,
fraudulent or forged; (ii) for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, that may prove to be invalid or
ineffective for any reason; (iii) for failure of the beneficiary of a Letter of Credit to
comply fully with conditions required in order to draw upon a Letter of Credit; (iv) for
errors, omissions, interruptions or delays in transmission or delivery of any messages, by
mail, cable, telegraph, telex or otherwise, whether or not they be in cipher; (v) for errors
in interpretation of technical terms; (vi) for any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under a Letter of Credit or of
the proceeds thereof; and (vii) for any consequences arising from causes beyond the control
of any Issuing Lender or any Lender, including, without limitation, any Government Acts.
None of the above shall affect, impair, or prevent the vesting of each Issuing Lender’s
rights or powers hereunder.

     (c) In furtherance and extension and not in limitation of the specific provisions
hereinabove set forth, any action taken or omitted by any Issuing Lender or any Lender,
under or in connection with any Letter of Credit or the related certificates, if taken or
omitted in the absence of gross negligence or willful misconduct, shall not put such Issuing
Lender or such Lender under any resulting liability to the Borrower. It is the intention of
the parties that this Credit Agreement shall be construed and applied to protect and
indemnify each Issuing Lender and each Lender against any and all risks involved in the
issuance of the Letters of Credit, all of which risks are hereby assumed by the Borrower,
including, without limitation, any and all risks of the acts or omissions, whether rightful
or wrongful, of any Government Authority. The Issuing Lenders and the Lenders shall not, in
any way, be liable for any failure by any Issuing Lender or anyone

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else to pay any drawing under any Letter of Credit as a result of any Government Acts or any
other cause beyond the control of the Issuing Lenders and the Lenders.

     (d) Nothing in this Section 2.20 is intended to limit the reimbursement obligation of
the Borrower contained in Section 2.2 and Section 2.5 hereof. The obligations of the
Borrower under this Section 2.20 shall survive the termination of this Credit Agreement. No
act or omissions of any current or prior beneficiary of a Letter of Credit shall in any way
affect or impair the rights of the Credit-Linked Issuing Lender and the Lenders to enforce
any right, power or benefit under this Credit Agreement.

     (e) Notwithstanding anything to the contrary contained in this Section 2.20, the
Borrower shall have no obligation to indemnify any Issuing Lender or any Lender in respect
of any liability incurred by such Issuing Lender or such Lender arising out of the gross
negligence or willful misconduct of such Issuing Lender (including action not taken by such
Issuing Lender or such Lender), as determined by a court of competent jurisdiction or
pursuant to arbitration.

     Section 2.21 Replacement of Lenders.

     If any Lender shall become affected by any of the changes or events described in Sections
2.16, 2.17, 2.18 or 2.19 (any such Lender being hereinafter referred to as a “Replaced
Lender”) and shall petition the Borrower for any increased cost or amounts thereunder, then in
such case, the Borrower may, upon at least thirty (30) Business Days’ notice to the Administrative
Agent and such Replaced Lender and so long as no Default or Event of Default has occurred and is
continuing, designate a replacement lender (a “Replacement Lender”) acceptable to the
Administrative Agent in its reasonable discretion, to which such Replaced Lender shall, subject to
its receipt (unless a later date for the remittance thereof shall be agreed upon by the Borrower
and the Replaced Lender) of all amounts owed to such Replaced Lender under Sections 2.16, 2.17,
2.18 or 2.19, assign at par all (but not less than all) of its rights, obligations, Loans and
Commitments hereunder; provided, that all amounts owed to such Replaced Lender by the
Borrower (except liabilities which by the terms hereof survive the payment in full of the Loans and
termination of this Agreement) shall be paid in full as of the date of such assignment. Upon any
assignment by any Lender pursuant to this Section 2.21 becoming effective, the Replacement Lender
shall thereupon be deemed to be a “Lender” for all purposes of this Agreement and such Replaced
Lender shall thereupon cease to be a “Lender” for all purposes of this Agreement and shall have no
further rights or obligations hereunder (other than pursuant to Sections 2.16, 2.17, 2.18 or 2.19,
and 9.5 while such Replaced Lender was a Lender). If any Replaced Lender shall refuse to assign
its rights, obligations, Loans and Commitment in accordance with the terms of this Section 2.21,
the Replaced Lender shall cease to be a “Lender” for all purposes of this Agreement upon payment to
the Replaced Lender of all amounts owing to such Replaced Lender in accordance with the terms of
this Section 2.21 without any further action of such Replaced Lender and so long as no Default or
Event of Default shall have occurred and be continuing, the Borrower shall have the right to
designate a Replacement Lender acceptable to the Administrative Agent in its reasonable discretion.

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     Section 2.22 Incremental Term Loan.

     Subject to the terms and conditions set forth herein, the Borrower shall have the right, at
any time prior to the Credit-Linked Maturity Date, to incur additional Indebtedness under this
Credit Agreement in the form of an increase to the Term Loan (the “Incremental Term Loan”)
by the amount of $75,000,000. The following terms and conditions shall apply to each Incremental
Term Loan: (a) no Default or Event of Default shall have occurred and be continuing at the time of
such increase, (b) the Borrower shall have received commitments from one or more existing Lenders
or one or more new lenders for such increase (with any new lender to be reasonably acceptable to
the Administrative Agent and the Borrower), (c) the Borrower shall be in pro forma compliance with
(i) the financial covenants set forth in Section 5.9 and (ii) the Incurrence Test, in each case
after giving effect to such increase, (d) the Administrative Agent shall have received a
satisfactory legal opinion of counsel to the Borrower and such other documentation as it deems
reasonably necessary to effectuate such increase, (e) the Incremental Term Loan shall not have a
shorter maturity than the Term Loan, (f) the proceeds of the Incremental Term Loan shall only be
used to refinance the 9.50% Senior Subordinated Notes, (g) the Weighted Average Life to Maturity of
such Incremental Term Loan shall not be shorter than the Weighted Average Life to Maturity of the
Term Loan and (h) if the interest rate margin on any Incremental Term Loan would be more than the
Applicable Percentage for the existing Term Loan, the Applicable Percentage on the existing Term
Loan (and, correspondingly, the Credit-Linked Interest) shall be increased such that the Applicable
Percentage on the existing Term Loan (and the Credit-Linked Interest) is equal to the interest rate
margin on such Incremental Term Loan. The Administrative Agent is authorized to enter into, on
behalf of the Lenders, any amendment to this Credit Agreement or any other Credit Document as may
be necessary to incorporate the terms of the Incremental Term Loan therein.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

     To induce the Lenders to enter into this Credit Agreement and to make the Extensions of Credit
herein provided for, each of the Credit Parties hereby represents and warrants to the
Administrative Agent and to each Lender that:

     Section 3.1 Financial Condition.

     (a) (i) The audited consolidated financial statements of the Borrower and its
consolidated Subsidiaries for the fiscal years ended November 30, 2004, 2005 and 2006,
together with the related consolidated statements of income or operations, equity and cash
flows for the fiscal years ended on such dates, (ii) the unaudited consolidated financial
statements of the Borrower and its consolidated Subsidiaries for the three-month period
ending on February 28, 2007, together with the related consolidated statements of income or
operations, equity and cash flows for the three-month period ending on such date and (iii) a
pro forma balance sheet of the Borrower and its consolidated Subsidiaries as of the last day
of the quarter ended immediately prior to the Closing Date:

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     (A) were prepared in accordance with GAAP consistently applied throughout the
period covered thereby, except as otherwise expressly noted therein;

     (B) fairly present the financial condition of the Borrower and its consolidated
Subsidiaries as of the date thereof (subject, in the case of the unaudited financial
statements, to normal year-end adjustments) and results of operations for the period
covered thereby;

     (C) show all material Indebtedness and other liabilities, direct or contingent,
of the Borrower and its consolidated Subsidiaries as of the date thereof, including
liabilities for taxes, material commitments and contingent obligations, required to
be shown on a balance sheet prepared in accordance with GAAP; and

     (D) show all other material Indebtedness and other liabilities, direct or
contingent, of the Borrower and its consolidated Subsidiaries as of the date
thereof, in the notes (shown in accordance with GAAP) to the financial statements
referred to in Section 3.1(a)(i) and (ii) above.

     (b) The five-year projections of the Borrower and its consolidated Subsidiaries
delivered to the Lenders on or prior to the Closing Date have been prepared in good faith
based upon reasonable assumptions.

     Section 3.2 No Change.

     Since November 30, 2006, there has been no development or event which has had or could
reasonably be expected to have a Material Adverse Effect.

     Section 3.3 Corporate Existence.

     Each of the Credit Parties (a) is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, (b) has the requisite power and authority and the
legal right to own and operate all its material property, to lease the material property it
operates as lessee and to conduct the business in which it is currently engaged, and (c) is duly
qualified to conduct business 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, except to the extent that such failure to qualify could not reasonably be expected
to have a Material Adverse Effect.

     Section 3.4 Corporate Power; Authorization; Enforceable Obligations.

     Each of the Credit Parties has full power and authority and the legal right to make, deliver
and perform the Credit Documents to which it is party and has taken all necessary action to
authorize the execution, delivery and performance by it of the Credit Documents to which it is

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party. 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 borrowings
hereunder or with the execution, delivery or performance of any Credit Document by any of the
Credit Parties (other than those which have been obtained) or with the validity or enforceability
of any Credit Document against any of the Credit Parties (except such filings as are necessary in
connection with the perfection of the Liens created by such Credit Documents). Each Credit
Document to which it is a party has been duly executed and delivered on behalf of the applicable
Credit Party. Each Credit Document to which it is a party constitutes a legal, valid and binding
obligation of each such Credit Party, enforceable against such Credit 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).

     Section 3.5 Compliance with Laws; No Conflict; No Default.

     (a) The execution, delivery and performance by each Credit Party of the Credit
Documents to which such Credit Party is a party, in accordance with their respective terms,
the borrowings hereunder and the Transactions do not and will not, by the passage of time,
the giving of notice or otherwise, (i) require any Governmental Approval (other than such
Governmental Approvals that have been obtained or made and not subject to suspension,
revocation or termination) or violate any Requirement of Law relating to such Credit Party,
(ii) conflict with, result in a breach of or constitute a default under the articles of
incorporation, bylaws, articles of organization, operating agreement or other organizational
documents of such Credit Party or any material indenture, agreement or other instrument to
which such Person is a party or by which any of its properties may be bound or any
Governmental Approval relating to such Person, or (iii) result in or require the creation or
imposition of any Lien upon or with respect to any property now owned or hereafter acquired
by such Person other than Liens arising under the Credit Documents.

     (b) Each Credit Party (i) (x) has all Governmental Approvals required by law for it to
conduct its business, each of which is in full force and effect, (y) each such Governmental
Approval is final and not subject to review on appeal and (z) each such Governmental
Approval is not the subject of any pending or, to the best of its knowledge, threatened
attack by direct or collateral proceeding, and (ii) is in compliance with each Governmental
Approval applicable to it and in compliance with all other Requirements of Law relating to
it or any of its respective properties, in each case except to the extent the failure to
obtain such Governmental Approval or failure to comply with such Governmental Approval or
Requirement of Law could not reasonably be expected to have a Material Adverse Effect.
Each Credit Party possesses or has the right to use, all leaseholds, licenses, easements
and franchises and all authorizations and other rights that are material to and necessary
for the conduct of its business. Except to the extent noncompliance with the foregoing
leaseholds, easements and franchises could not reasonably be expected to have a Material
Adverse Effect, all of the foregoing are in full force and effect, and the Credit Parties
are in substantial compliance with the foregoing

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without any known conflict with the valid rights of others. No event has occurred which
permits, or after notice or lapse of time or both would permit, the revocation or
termination of any such Governmental Approval, leasehold, license, easement, franchise or
other right, which termination or revocation could, individually or in the aggregate,
reasonably be expected to have Material Adverse Effect.

     (c) None of the Credit Parties is in default under or with respect to any of its
Material Contracts or under or with respect to any of its other Contractual Obligations, or
any judgment, order or decree to which it is a party, in any respect which could reasonably
be expected to have a Material Adverse Effect. No Default or Event of Default has occurred
and is continuing.

     Section 3.6 No Material Litigation.

     No litigation, investigation or proceeding of or before any arbitrator or Governmental
Authority is pending or, to the knowledge of the Credit Parties, threatened by or against any
Credit Party, any Subsidiary of a Credit Party or any Permitted Real Estate Entity, or against any
of their respective properties or revenues, (a) with respect to the Credit Documents or any Loan or
any of the Transactions, or (b) which could reasonably be expected to have a Material Adverse
Effect.

     Section 3.7 Investment Company Act.

     None of the Credit Parties is an “investment company”, or a company “controlled” by an
“investment company”, within the meaning of the Investment Company Act of 1940, as amended.

     Section 3.8 Margin Regulations.

     No part of the proceeds of any Loan hereunder will be used directly or indirectly for any
purpose which violates, or which would be inconsistent with, the provisions of Regulation T, U or X
of the Board of Governors of the Federal Reserve System as now and from time to time hereafter in
effect. The Credit Parties (a) are not engaged, principally or as one of its important activities,
in the business of extending credit for the purpose of “purchasing” or “carrying” “margin stock”
within the respective meanings of each of such terms under Regulation U and (b) taken as a group do
not own “margin stock” except as identified in the financial statements referred to in Section 3.1
and the aggregate value of all “margin stock” owned by the Credit Parties taken as a group does not
exceed 25% of the value of their assets.

     Section 3.9 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 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,
except to the extent that any such occurrence or failure to comply would not

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reasonably be expected to have a Material Adverse Effect. No termination of a Single Employer Plan
has occurred resulting in any liability that has remained underfunded, and no Lien in favor of the
PBGC or a Plan has arisen, during such five-year period which could reasonably be expected to have
a Material Adverse Effect. 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 an amount which could reasonably be
expected to have a Material Adverse Effect. Neither the Borrower, nor any Subsidiary of the
Borrower nor any Commonly Controlled Entity is currently subject to any liability for a complete or
partial withdrawal from a Multiemployer Plan that could reasonably be expected to have a Material
Adverse Effect.

     Section 3.10 Environmental Matters.

     (a) Except where such violation or liability could not reasonably be expected to have a
Material Adverse Effect, the facilities and properties owned, leased or operated by any of
the Credit Parties or their Subsidiaries (other than Permitted Real Estate Entities) and
properties subject to a Permitted Real Estate Transfer pursuant to clause (a) of such
definition (collectively, the “Properties”) do not contain any Materials of
Environmental Concern in amounts or concentrations which (i) constitute a violation of, or
(ii) could give rise to liability under, any Environmental Law.

     (b) Except where such violation, contamination or non-compliance could not reasonably
be expected to have a Material Adverse Effect, the Properties and all operations of any of
the Credit Parties or their Subsidiaries (other than Permitted Real Estate Entities) at the
Properties are in compliance, and have in the last five (5) years been in compliance, in all
material respects 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 operated by the any of the Credit Parties and their Subsidiaries
(the “Business”).

     (c) Except where such violation or liability could not reasonably be expected to have a
Material Adverse Effect, none of the Credit Parties or their Subsidiaries (other than
Permitted Real Estate Entities) has received any written or actual 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, nor does any of the Credit Parties and their Subsidiaries (other than Permitted
Real Estate Entities) have knowledge of any such threatened notice.

     (d) Except where such violation or liability could not reasonably be expected to have a
Material Adverse Effect, 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 which 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 violation of, or in a manner that could give rise to liability under, any applicable
Environmental Law.

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     (e) Except where such liability could not reasonably be expected to have a Material
Adverse Effect, no judicial proceeding or governmental or administrative action is pending
or, to the knowledge of any Credit Party or any of their Subsidiaries (other than Permitted
Real Estate Entities), threatened, under any Environmental Law to which any of the Credit
Parties 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 which could reasonably be
expected to have a Material Adverse Effect.

     (f) Except where such violation or liability could not reasonably be expected to have a
Material Adverse Effect, 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 of the Credit Parties or their Subsidiaries (other than Permitted Real
Estate Entities) 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.

     Section 3.11 Use of Proceeds.

     The proceeds of the Extensions of Credit will be used (i) to refinance certain existing
Indebtedness of the Borrower and its Subsidiaries, (ii) to fund the Credit Linked Deposit, (iii) to
pay any fees and expenses associated with this Credit Agreement and other financings of the
Borrower on the Closing Date, (iv) to finance Permitted Acquisitions and (v) for working capital
and other general corporate purposes of the Borrower and its Subsidiaries.

     Section 3.12 Subsidiaries.

     Set forth on Schedule 3.12 (as updated quarterly by the Borrower) is a complete and
accurate list of all Subsidiaries of the Credit Parties. Information on such Schedule includes the
number of shares of each class of Capital Stock or other equity interests outstanding; the number
and percentage of outstanding shares of each class of stock owned by the Credit Parties or any of
their Subsidiaries; the number and effect, if exercised, of all outstanding options, warrants,
rights of conversion or purchase and similar rights. The outstanding Capital Stock and other
equity interests of all such Subsidiaries is validly issued, fully paid and non-assessable and is
owned, free and clear of all Liens (other than those arising under or contemplated in connection
with the Credit Documents).

     Section 3.13 Ownership.

     Each of the Credit Parties is the owner of, and has good and marketable title to, all of its
respective assets, which, together with assets leased or licensed by the Credit Parties, represents
all assets individually or in the aggregate material to the conduct of the businesses of the Credit
Parties, taken as a whole on the date hereof, and none of such assets is subject to any Lien other
than Permitted Liens. Each Credit Party enjoys peaceful and undisturbed possession under all of

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its material leases and all such material leases are valid and subsisting and in full force and
effect. The Credit Parties have made available complete and accurate copies of all material leases
to the Administrative Agent.

     Section 3.14 Indebtedness.

     Except as otherwise permitted under Section 6.1, the Credit Parties have no Indebtedness.

     Section 3.15 Taxes.

     Each of the Credit Parties and their Significant Subsidiaries has filed, or caused to be
filed, all tax returns (federal, state, local and foreign) required to be filed and paid (a) all
material amounts of taxes shown thereon to be due (including interest and penalties) and (b) all
other taxes, fees, assessments and other governmental charges (including mortgage recording taxes,
documentary stamp taxes and intangibles taxes) owing by it, except for such taxes (i) which are not
yet delinquent or (ii) that are being contested in good faith and by proper proceedings, and
against which adequate reserves are being maintained in accordance with GAAP. None of the Credit
Parties is aware as of the Closing Date of any proposed tax assessments against it or any of its
Subsidiaries which could reasonably be expected to have a Material Adverse Effect.

     Section 3.16 Intellectual Property Rights.

     Each of the Credit Parties and their Significant Subsidiaries owns, or has the legal right to
use, all Intellectual Property necessary for each of them to conduct its business as currently
conducted. Set forth on Schedule 3.16 (as updated quarterly by the Borrower) is a list of
all Intellectual Property (other than Intellectual Property of de minimus value) owned by each of
the Credit Parties and their Subsidiaries or that the Credit Parties or any of their Significant
Subsidiaries has the right to use. Except as disclosed in Schedule 3.16 hereto, with
respect to the material Intellectual Property of the Credit Parties, (a) one or more of the Credit
Parties has the right to use such Intellectual Property in perpetuity and without payment of
royalties, (b) all material registrations with and applications to Governmental Authorities in
respect of such Intellectual Property are valid and in full force and effect and are not subject to
the taking of any interest therein, and no taxes or maintenance fees payable with respect to such
Intellectual Property to maintain their validity or effectiveness are delinquent, and (c) there are
no restrictions on the direct or indirect transfer of any Contractual Obligation, or any interest
therein, held by any of the Credit Parties in respect of such Intellectual Property. None of the
Credit Parties is in default (or with the giving of notice or lapse of time or both, would be in
default) in any material respect under any license to use such Intellectual Property; no claim has
been asserted and is pending by any Person challenging or questioning the use of any such
Intellectual Property or the validity or effectiveness of any such Intellectual Property, nor does
the Credit Parties or any of their Subsidiaries know of any such claim; and, to the actual
knowledge of the Credit Parties or any of their Subsidiaries, the use of such Intellectual Property
by the Credit Parties or any of their Subsidiaries does not infringe on the rights of any Person,
except for such defaults, claims and infringements that in the aggregate could not reasonably be
expected to have a Material Adverse Effect. The Credit Parties have recorded or deposited with and
paid to the United States Copyright Office, the Register of Copyrights, the Copyrights

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Royalty Tribunal or other Governmental Authority, all notices, statements of account, royalty fees
and other documents and instruments required under the terms and conditions of any Contractual
Obligation of the Credit Parties and/or under Title 17 of the United States Code and the rules and
regulations issued thereunder (collectively, the “Copyright Act”), and are not liable to
any Person for copyright infringement under the Copyright Act or any other law, rule, regulation,
contract or license as a result of their business operations. Schedule 3.16 may be updated
from time to time by the Borrower to include new Intellectual Property by giving written notice
thereof to the Administrative Agent.

     Section 3.17 Solvency.

     After giving effect to the Transactions, the fair saleable value of each Credit Party’s
assets, measured on a going concern basis, exceeds all probable liabilities, including those to be
incurred pursuant to this Credit Agreement. After giving effect to the Transactions, none of the
Credit Parties has incurred, or believes that it will incur after giving effect to the
Transactions, debts beyond its ability to pay such debts as they become due. In executing the
Credit Documents and consummating the Transactions, none of the Credit Parties intends to hinder,
delay or defraud either present or future creditors or other Persons to which one or more of the
Credit Parties is or will become indebted.

     Section 3.18 Investments.

     All Investments of each of the Credit Parties are Permitted Investments.

     Section 3.19 Location of Collateral.

     Set forth on Schedule 3.19(a) is a list of the Properties of the Credit Parties and
their Significant Subsidiaries as of the Closing Date with street address, county and state where
located. Set forth on Schedule 3.19(b) is a list of all locations where any tangible
personal property of the Credit Parties and their Subsidiaries is located as of the Closing Date,
including county and state where located. Set forth on Schedule 3.19(c) is the state of
incorporation or organization, chief executive office and principal place of business of each of
the Credit Parties as of the Closing Date.

     Section 3.20 No Burdensome Restrictions.

     None of the Credit Parties is a party to any agreement or instrument or subject to any other
obligation or any charter or corporate restriction or any provision of any applicable law, rule or
regulation which, individually or in the aggregate, could reasonably be expected to have a Material
Adverse Effect.

     Section 3.21 Brokers’ Fees.

     None of the Credit Parties and their Subsidiaries has any obligation to any Person in respect
of any finder’s, broker’s, investment banking or other similar fee in connection with the

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Credit Agreement and the loans hereunder, other than the closing and other fees payable pursuant to
this Credit Agreement and as set forth in the Fee Letter.

     Section 3.22 Labor Matters.

     There are no collective bargaining agreements or Multiemployer Plans covering the employees of
the Credit Parties as of the Closing Date, other than as set forth in Schedule 3.22 hereto,
and none of the Credit Parties is suffering or has suffered any strikes, walkouts, work stoppages
or other material labor difficulty within the last five (5) years, other than as set forth in
Schedule 3.22 hereto.

     Section 3.23 Accuracy and Completeness of Information.

     All factual information heretofore, contemporaneously or hereafter furnished by or on behalf
of the Credit Parties in writing to the Administrative Agent or any Lender for purposes of or in
connection with this Credit Agreement or any other Credit Document (other than any projection
provided by the Borrower in good faith), or any transaction contemplated hereby or thereby, is or
will be true and accurate in all material respects and not incomplete by omitting to state any
material fact necessary to make such information not misleading. There is no fact now known to any
of the Credit Parties which has, or could reasonably be expected to have, a Material Adverse Effect
which fact has not been set forth herein, in the financial statements of the Credit Parties
furnished to the Administrative Agent and/or the Lenders, or in any certificate, opinion or other
written statement made or furnished by or on behalf of the Credit Parties to the Administrative
Agent and/or the Lenders.

     Section 3.24 Material Contracts.

     Schedule 3.24 sets forth a complete and accurate list of all Material Contracts of the
Credit Parties and their Subsidiaries in effect as of the Closing Date. Other than as set forth in
Schedule 3.24, each such Material Contract is, and after giving effect to the Transactions
will be, in full force and effect in accordance with the terms thereof. The Credit Parties and
their Subsidiaries have made available to the Administrative Agent a true and complete copy of each
Material Contract requested by the Administrative Agent. Schedule 3.24 may be updated from
time to time by the Borrower to include new Material Contracts by giving written notice thereof to
the Administrative Agent.

     Section 3.25 Insurance.

     The insurance coverage of the Credit Parties and their Subsidiaries as of the Closing Date is
outlined as to carrier, policy number, expiration date, type and amount on Schedule 3.25
and such insurance coverage complies with the requirements set forth in Section 5.5(b).

     Section 3.26 Security Documents.

     The Security Documents create valid security interests in, and Liens on, the Collateral
purported to be covered thereby, which security interests and Liens are currently (or will be,

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upon the execution of control agreements with respect to deposit and securities accounts and the
filing or recording of appropriate financing statements, Mortgage Instruments and notices of grants
of security interests in Intellectual Property, in each case in favor of the Administrative Agent
on behalf of the Secured Parties) perfected security interests and Liens, prior to all other Liens
other than Permitted Liens.

     Section 3.27 Regulation H.

     No Mortgaged Property is a Flood Hazard Property, unless the requirements of Section 4.1(e)(v)
have been satisfied with respect to such Mortgaged Property.

     Section 3.28 Classification of Senior Indebtedness.

     The Credit Party Obligations constitute “Senior Indebtedness” under and as defined in any
agreement governing any Subordinated Debt (including, without limitation, the Existing Subordinated
Notes) and the subordination provisions set forth in each such agreement are legally valid and
enforceable against the parties thereto.

     Section 3.29 Anti-Terrorism Laws.

     Neither any Credit Party nor any of its Subsidiaries is an “enemy” or an “ally of the enemy”
within the meaning of Section 2 of the Trading with the Enemy Act of the United States of America
(50 U.S.C. App. §§ 1 et seq.), as amended. Neither any Credit Party nor any or its Subsidiaries is
in violation of (a) the Trading with the Enemy Act, as amended, (b) any of the foreign assets
control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as
amended) or any enabling legislation or executive order relating thereto or (c) the Patriot Act.
None of the Credit Parties (i) is a blocked person described in Section 1 of the Anti-Terrorism
Order or (ii) to the best of its knowledge, engages in any dealings or transactions, or is
otherwise associated, with any such blocked person.

     Section 3.30 Compliance with OFAC Rules and Regulations.

     None of the Credit Parties or their Subsidiaries or their respective Affiliates (a) is a
Sanctioned Person, (b) has more than 15% of its assets in Sanctioned Countries, or (c) derives more
than 15% of its operating income from investments in, or transactions with Sanctioned Persons or
Sanctioned Countries. No part of the proceeds of any Extension of Credit hereunder will be used
directly or indirectly to fund any operations in, finance any investments or activities in or make
any payments to, a Sanctioned Person or a Sanctioned Country.

     Section 3.31 Compliance with FCPA.

     Each of the Credit Parties and their Subsidiaries is in compliance with the Foreign Corrupt
Practices Act, 15 U.S.C. §§ 78dd-1, et seq., and any foreign counterpart thereto. None of the
Credit Parties or their Subsidiaries has made a payment, offering, or promise to pay, or authorized
the payment of, money or anything of value (a) in order to assist in obtaining or retaining
business for or with, or directing business to, any foreign official, foreign political

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party, party official or candidate for foreign political office, (b) to a foreign official,
foreign political party or party official or any candidate for foreign political office, and (c)
with the intent to induce the recipient to misuse his or her official position to direct business
wrongfully to such Credit Party or its Subsidiary or to any other Person, in violation of the
Foreign Corrupt Practices Act, 15 U.S.C. §§ 78dd-1, et seq.

     Notwithstanding any term of this Article III (or the definition of any defined term used in
this Article III) to the contrary and notwithstanding the status of any Permitted Real Estate
Entity as a consolidated Subsidiary of the Borrower, the representations and warranties set forth
in this Article III (other than the representations and warranties set forth in Sections 3.2 and
3.6 and the defined terms used in such Sections) shall not apply to or be construed to include any
Permitted Real Estate Entity unless such Permitted Real Estate Entity is a Guarantor hereunder.

ARTICLE IV

CONDITIONS PRECEDENT

     Section 4.1 Conditions to Closing Date.

     This Credit Agreement shall become effective upon, and the obligation of each Lender to make
the initial Revolving Loans, Term Loans and Swingline Loans on the Closing Date and to fund its
Credit-Linked Deposit is subject to, the satisfaction of the following conditions precedent:

     (a) Execution of Credit Agreement and Credit Documents. The Administrative
Agent shall have received (i) counterparts of this Credit Agreement, (ii) for the account of
each Lender with a Revolving Commitment requesting a promissory note, a Revolving Note,
(iii) for the account of the Swingline Lender, the Swingline Note, (iv) for the account of
each Credit-Linked Issuing Lender, a Credit-Linked Note, (v) counterparts of the Security
Agreement and the Pledge Agreement and (vi) counterparts of any other Credit Document, in
each case conforming to the requirements of this Credit Agreement and executed by duly
authorized officers of the Credit Parties and the other parties thereto, as applicable.

     (b) Authority Documents. The Administrative Agent shall have received the
following:

     (i) Articles of Incorporation; Partnership Agreement. Copies of the
articles of incorporation, partnership agreement or other charter documents of each
Credit Party certified to be true and complete as of a recent date by the
appropriate governmental authority of the state of its organization or formation.

     (ii) Resolutions. Copies of resolutions of the board of directors of
each Credit Party approving and adopting the Credit Documents and the Transactions
and authorizing execution and delivery thereof, certified by an

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officer of such Credit Party as of the Closing Date to be true and correct and in
force and effect as of such date.

     (iii) Bylaws. A copy of the bylaws or other operating agreement of
each Credit Party certified by an officer of such Credit Party as of the Closing
Date to be true and correct and in force and effect as of such date.

     (iv) Good Standing. Copies of (i) certificates of good standing,
existence or its equivalent with respect to the each Credit Party certified as of a
recent date by the appropriate governmental authorities of the state of
incorporation and each other state in which the failure of such Credit Party to be
qualified to do business could reasonably be expected to have a Material Adverse
Effect and (ii) to the extent readily available, a certificate indicating payment of
all corporate and other franchise taxes certified as of a recent date by the
appropriate governmental taxing authorities.

     (v) Incumbency. An incumbency certificate of each Credit Party
certified by a secretary or assistant secretary to be true and correct as of the
Closing Date.

     Each officer’s certificate delivered pursuant to this Section 4.1(b) shall be
substantially in the form of Schedule 4.1(b) hereto.

     (c) Legal Opinions of Counsel. The Administrative Agent shall have received an
opinion or opinions of counsel for the Credit Parties, dated as of the Closing Date and
addressed to the Administrative Agent and the Lenders, in form and substance acceptable to
the Administrative Agent.

     (d) Personal Property Collateral. The Administrative Agent shall have
received, in form and substance satisfactory to the Administrative Agent:

     (i) searches of UCC filings in the jurisdiction of the chief executive office
and jurisdiction of formation of each Credit Party and each jurisdiction where any
Collateral is located or where a filing would need to be made in order to perfect
the Administrative Agent’s security interest in the Collateral, copies of the
financing statements on file in such jurisdictions and evidence that no Liens exist
other than Permitted Liens and Liens that are to be terminated on the Closing Date;

     (ii) UCC financing statements for each appropriate jurisdiction as is
necessary, in the Administrative Agent’s sole discretion, to perfect the
Administrative Agent’s security interest in the Collateral;

     (iii) searches of ownership of Intellectual Property in the appropriate
governmental offices;

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     (iv) such patent/trademark/copyright filings as requested by the Administrative
Agent in order to perfect the Administrative Agent’s security interest in the
Intellectual Property;

     (v) all stock certificates, if any, evidencing the Capital Stock pledged to the
Administrative Agent pursuant to the Pledge Agreement, together with duly executed
in blank undated stock powers attached thereto;

     (vi) all instruments and chattel paper in the possession of any of the Credit
Parties, together with allonges or assignments as may be necessary or appropriate to
perfect the Administrative Agent’s security interest in the Collateral;

     (vii) duly executed consents as are necessary, in the Administrative Agent’s
sole discretion, to perfect the Lenders’ security interest in the Collateral; and

     (viii) such duly executed account control agreements as requested by the
Administrative Agent with respect to Collateral for which a control agreement is
required for perfection of the Administrative Agent’s security interest under the
Uniform Commercial Code.

     (e) Real Property Collateral. The Administrative Agent shall have received, in
form and substance satisfactory to the Administrative Agent:

     (i) fully executed and notarized Mortgage Instruments or amendments to
Mortgaged Instruments, as the case may be, encumbering the Mortgaged Properties (and
assigning the leases and rents with respect to such Mortgaged Properties) listed in
Schedule 1.1(e);

     (ii) a title report obtained by the Credit Parties in respect of each of the
Mortgaged Properties listed in Schedule 1.1(e);

     (iii) a Mortgage Policy with respect to each of the Mortgaged Properties listed
in Schedule 1.1(e);

     (iv) an appraisal from an appraiser selected by the Administrative Agent;

     (v) evidence as to (A) whether any Mortgaged Property listed in Schedule
1.1(e) is in an area designated by the Federal Emergency Management Agency as
having special flood or mud slide hazards (a “Flood Hazard Property”) and
(B) if any such Mortgaged Property is a Flood Hazard Property, (1) whether the
community in which such Mortgaged Property is located is participating in the
National Flood Insurance Program, (2) the applicable Credit Party’s written
acknowledgment of receipt of written notification from the Administrative Agent

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(x) as to the fact that such Mortgaged Property is a Flood Hazard Property and (y)
as to whether the community in which each such Flood Hazard Property is located is
participating in the National Flood Insurance Program and (z) copies of insurance
policies or certificates of insurance of the Credit Parties evidencing flood
insurance reasonably satisfactory to the Administrative Agent and naming the
Administrative Agent as sole loss payee on behalf of the Lenders;

     (vi) to the extent available or otherwise required by the Administrative Agent
in its reasonable discretion, a survey of each of the Mortgaged Properties listed in
Schedule 1.1(e) to the extent such survey is required to delete any standard
survey exception in the Mortgage Policy with respect to such Mortgaged Property;

     (vii) to the extent available or otherwise required by the Administrative Agent
in its reasonable discretion, a Phase I environmental report (and, if necessary,
Phase II environmental report) or other environmental report acceptable to the
Administrative Agent with respect to each of the Mortgaged Properties listed in
Schedule 1.1(e); and

     (viii) an opinion of counsel to the Credit Parties for each jurisdiction in
which the Mortgaged Properties are located.

     (f) Liability and Casualty Insurance. The Administrative Agent shall have
received copies of insurance policies or certificates of insurance evidencing liability and
casualty insurance (including, but not limited to, business interruption insurance) meeting
the requirements set forth herein or in the Security Documents. The Administrative Agent
shall be named as loss payee on all casualty insurance policies and as additional insured on
all liability insurance policies, in each case for the benefit of the Lenders.

     (g) Solvency Certificate. The Administrative Agent shall have received an
officer’s certificate prepared by the chief financial officer of the Borrower as to the
financial condition, solvency and related matters of each of the Credit Parties and the
Credit Parties and their Significant Subsidiaries taken as a whole, after giving effect to
the initial borrowings under the Credit Documents, in substantially the form of Schedule
4.1(g) hereto.

     (h) Account Designation Letter. The Administrative Agent shall have received
the executed Account Designation Letter in the form of Schedule 1.1(a) hereto.

     (i) Organizational Structure. The corporate and capital and ownership
structure of the Credit Parties and their Subsidiaries (after giving effect to the
Transactions) shall be as described in Schedule 3.12. The Administrative Agent
shall be satisfied with the management structure, legal structure, voting control,
liquidity, total leverage and total capitalization of the Credit Parties and their
Significant Subsidiaries after giving effect to the Transactions.

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     (j) Consents. The Administrative Agent shall have received evidence that all
boards of directors, governmental, shareholder and material third party consents and
approvals necessary in connection with the Transactions have been obtained and all
applicable waiting periods have expired without any action being taken by any authority that
could restrain, prevent or impose any material adverse conditions on such transactions or
that could seek or threaten any of the foregoing.

     (k) Compliance with Laws. The Transactions shall be in compliance with all
applicable laws and regulations (including all applicable securities and banking laws, rules
and regulations).

     (l) Bankruptcy. There shall be no bankruptcy or insolvency proceedings with
respect to Credit Parties or any of their Subsidiaries.

     (m) Existing Indebtedness of the Credit Parties. All of the existing
Indebtedness for borrowed money of the Borrower and its Subsidiaries (other than
Indebtedness permitted to exist pursuant to Section 6.1) shall be repaid in full and all
security interests related thereto shall be terminated on the Closing Date.

     (n) Financial Statements. The Administrative Agent and the Lenders shall have
received copies of the financial statements referred to in Section 3.1 hereof, each in form
and substance satisfactory to it.

     (o) No Material Adverse Change. Since November 30, 2006, there shall not have
occurred any event or development that has had or could reasonably be expected to have a
Material Adverse Effect.

     (p) Financial Condition Certificate. The Administrative Agent shall have
received a certificate or certificates executed by a Responsible Officer of the Borrower as
of the Closing Date stating that (i) no pending litigation or investigation exists affecting
or relating to (x) any Credit Party or any of its Subsidiaries that could reasonably be
expected to have a Material Adverse Effect, that has not been settled, dismissed, vacated,
discharged or terminated prior to the Closing Date or (y) this Agreement or the other Credit
Documents that have not been settled, dismissed, vacated, discharged or terminated prior to
the Closing Date and (ii) immediately after giving effect to this Credit Agreement, the
other Credit Documents, and all the Transactions contemplated to occur on such date, (A) no
Default or Event of Default exists, (B) all representations and warranties contained herein
and in the other Credit Documents (i) that contain a materiality qualification shall be true
and correct and (ii) that do not contain a materiality qualification shall be true and
correct in all material respects, and (C) the Credit Parties are in pro forma compliance
with each of the initial financial covenants set forth in Section 5.9 (as evidenced through
detailed calculations of such financial covenants on a schedule to such certificate) as of
May 31, 2007.

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     (q) Total Funded Debt. The Administrative Agent shall have received evidence
that, immediately after giving effect to the Transactions, Total Funded Debt is less than or
equal to $455,000,000.

     (r) Consolidated EBITDAP. The Administrative Agent shall have received
evidence reasonably satisfactory thereto provided by the Credit Parties that Consolidated
EBITDAP is not less than $89,000,000 for the twelve (12) month period ending as of February
28, 2007.

     (s) Patriot Act Certificate. At least five (5) Business Days prior to the
Closing Date, the Administrative Agent shall have received a certificate satisfactory
thereto, substantially in the form of Schedule 4.1(s), for benefit of itself and the
Lenders, provided by the Borrower that sets forth information required by the Patriot Act
including, without limitation, the identity of the Credit Parties, the name and address of
the Credit Parties and other information that will allow the Administrative Agent or any
Lender, as applicable, to identify the Credit Parties in accordance with the Patriot Act.

     (t) Fees. The Administrative Agent and the Lenders shall have received all
fees, if any, owing pursuant to the Fee Letter and Section 2.7.

     (u) Additional Matters. All other documents and legal matters in connection
with the Transactions shall be reasonably satisfactory in form and substance to the
Administrative Agent and its counsel.

     Section 4.2 Conditions to All Extensions of Credit.

     The obligation of each Lender to make any Extension of Credit (other than the obligation of
each Lender to fund its portion of a Mandatory LOC Borrower or a Mandatory Swingline Borrower,
which shall be governed by the terms of Section 2.2 and Section 2.3, respectively) hereunder is
subject to the satisfaction of the following conditions precedent on the date of making such
Extension of Credit:

     (a) Representations and Warranties. The representations and warranties made by
the Credit Parties herein, in the Security Documents or which are contained in any
certificate furnished at any time under or in connection herewith (i) that contain a
materiality qualification shall be true and correct on and as of the date of such Extension
of Credit as if made on and as of such date (except for those which expressly relate to an
earlier date) and (ii) that do not contain a materiality qualification shall be true and
correct in all material respects on and as of the date of such Extension of Credit as if
made on and as of such date (except for those which expressly relate to an earlier date).

     (b) No Default or Event of Default. No Default or Event of Default shall have
occurred and be continuing on such date or after giving effect to the Extension of Credit to
be made on such date unless such Default or Event of Default shall have been waived in
accordance with this Credit Agreement.

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     (c) Compliance with Commitments. Immediately after giving effect to the making
of any such Extension of Credit (and the application of the proceeds thereof), (i) the sum
of the aggregate principal amount of outstanding Revolving Loans plus outstanding
Swingline Loans plus outstanding Revolving LOC Obligations shall not exceed the
Revolving Committed Amount then in effect, (ii) the Revolving LOC Obligations shall not
exceed the Revolving LOC Committed Amount, (iii) the Swingline Loans shall not exceed the
Swingline Committed Amount and (iv) the sum of the aggregate principal amount of the
outstanding Term Loans plus outstanding Credit-Linked LOC Obligations shall not
exceed the Credit-Linked Committed Amount.

     (d) Additional Conditions to Revolving Loans. If such Loan is made pursuant to
Section 2.1, all conditions set forth in such Section shall have been satisfied.

     (e) Additional Conditions to Revolving Letters of Credit. If such Extension of
Credit is made pursuant to Section 2.2, all conditions set forth in such Section shall have
been satisfied.

     (f) Additional Conditions to Swingline Loans. If such Loan is made pursuant to
Section 2.3, all conditions set forth in such Section shall have been satisfied.

     (g) Additional Conditions to Credit-Linked Letters of Credit. If such
Extension of Credit is made pursuant to Section 2.5, all conditions set forth in such
Section shall have been satisfied.

     Each request for an Extension of Credit and each acceptance by the Borrower of any such
Extension of Credit shall be deemed to constitute a representation and warranty by the Borrower as
of the date of such Extension of Credit that the applicable conditions in paragraphs (a) through
(g) of this Section have been satisfied.

ARTICLE V

AFFIRMATIVE COVENANTS

     The Credit Parties hereby covenant and agree that on the Closing Date, and thereafter for so
long as this Credit Agreement is in effect and until the Commitments have terminated and the Credit
Party Obligations under the Credit Documents have been paid in full, the Credit Parties shall, and
shall cause each of their Subsidiaries and the Permitted Real Estate Entities to:

     Section 5.1 Financial Statements.

     Furnish to the Administrative Agent and each of the Lenders:

     (a) Annual Financial Statements. As soon as available after the end of each
fiscal year of the Borrower (commencing with the fiscal year ending November 30, 2007), but
in any event on or before the earlier of (i) the date the Borrower is required to

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file its annual financial statements on Form 10-K with the SEC and (ii) the date that is
ninety (90) days after the end of such fiscal year, a copy of (A) the Borrower’s annual
financial statements on Form 10-K as filed with the SEC or (B) the consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as at the end of such fiscal year
and the related consolidated statements of income and retained earnings and of cash flows of
the Borrower and its consolidated Subsidiaries for such year, audited by a firm of
independent certified public accountants reasonably acceptable to the Administrative Agent,
setting forth in each case in comparative form the figures for the preceding fiscal year,
reported on without a “going concern” or like qualification or exception, or qualification
indicating that the scope of the audit was inadequate to permit such independent certified
public accountants to certify such financial statements without such qualification;
provided that if any Permitted Real Estate Entity is not or ceases to be a
consolidated Subsidiary of the Borrower, the Borrower shall furnish to the Administrative
Agent and each of the Lenders annual audited financial statements for such Permitted Real
Estate Entity in accordance with time limits and other terms set forth above;

     (b) Quarterly Financial Statements. As soon as available after the end of each
of the first three fiscal quarters of the Borrower, but in any event on or before the
earlier of (i) the date the Borrower is required to file its quarterly financial statements
on Form 10-Q with the SEC and (ii) the date that is forty-five (45) days after the end of
such fiscal quarter, a copy of (A) the Borrower’s quarterly financial statements on Form
10-Q as filed with the SEC or (B) a company-prepared consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as at the end of such period and related
company-prepared consolidated statements of income and retained earnings and of cash flows
for the Borrower and its consolidated Subsidiaries for such quarterly period and for the
portion of the fiscal year ending with such period, in each case setting forth in
comparative form the figures for the corresponding period or periods of the preceding fiscal
year (subject to normal recurring year-end audit adjustments); provided that if any
Permitted Real Estate Entity ceases to be a consolidated Subsidiary of the Borrower, the
Borrower shall furnish to the Administrative Agent and each of the Lenders quarterly
financial statements for such Permitted Real Estate Entity in accordance with time limits
and other terms set forth above; and

     (c) Annual Financial Plans. (i) Concurrently with the delivery of the
financial statements referred to in clause (a) above, a consolidated budget and cash flow
projections prepared on a quarterly basis of the Borrower and its consolidated Subsidiaries
for the following fiscal year, and (ii) as soon as practicable, a combined budget and cash
flow projections for the Permitted Real Estate Entities taken as a whole for the following
fiscal year, in each case, in form and detail reasonably acceptable to the Administrative
Agent, such budget to be prepared by the Borrower in a manner consistent with GAAP and to
include an operating and capital budget and a summary of the material assumptions made in
the preparation of such budget. Such budget shall be accompanied by a certificate of the
treasurer or chief financial officer of the Borrower to the effect that the budgets and
other financial data are based on reasonable estimates and assumptions, all of which such
officer believes are fair in light of the conditions which existed at the time the budget
was made, have been prepared on the basis of the assumptions stated

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therein, and reflect, as of the time so furnished, the reasonable estimate of the Borrower
and its consolidated Subsidiaries of the budgeted results of the operations and other
information budgeted therein;

all such financial statements referred to in subsections (a) and (b) above shall (i) fairly present
in all material respects the financial condition and results from operations of the entities and
for the periods specified and to be prepared in reasonable detail and in accordance with GAAP
(subject, in the case of interim statements, to normal recurring year-end audit adjustments)
applied consistently throughout the periods reflected therein and further accompanied by a
description of, and an estimation of the effect on the financial statements on account of, any
change in the application of accounting principles as provided in Section 1.3, if applicable and
(ii) be deemed delivered for purposes of the Section 5.1 when such financial statements are
delivered to the SEC.

     Section 5.2 Certificates; Other Information.

     Furnish to the Administrative Agent and each of the Lenders, to the extent not publicly
available through filings under the Securities Exchange Act of 1934:

     (a) concurrently with the delivery of the financial statements referred to in Section
5.1(a) above, a certificate of the independent certified public accountants reporting on
such financial statements stating that in making the examination necessary therefor no
knowledge was obtained of any Default or Event of Default, except as specified in such
certificate;

     (b) concurrently with the delivery of the financial statements referred to in Sections
5.1(a) and 5.1(b) above, a certificate of a Responsible Officer substantially in the form of
Schedule 5.2(b) (i) stating that (A) such financial statements present fairly the
financial position of the Borrower and its consolidated Subsidiaries for the periods
indicated in conformity with GAAP applied on a consistent basis, (B) to the knowledge of
such Responsible Officer, each of the Credit Parties during such period observed or
performed in all material respects all of its covenants and other agreements, and satisfied
in all material respects every condition, contained in this Credit Agreement to be observed,
performed or satisfied by it, and (C) such Responsible Officer has obtained no knowledge of
any Default or Event of Default except as specified in such certificate and (ii) providing
calculations in reasonable detail required to indicate compliance with Section 5.9 as of the
last day of such period, which calculations shall include detail regarding all material
adjustments and amounts added back in determining Consolidated EBITDAP;

     (c) within thirty (30) days after the same are sent, copies of all financial statements
and reports (other than those otherwise provided pursuant to Section 5.1 and those which are
of a promotional nature) and other financial information which the Borrower sends to its
shareholders;

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     (d) within one hundred (100) days after the end of each fiscal year of the Borrower, a
certificate containing information regarding (i) the calculation of Excess Cash Flow and
(ii) the amount of all Asset Dispositions, Debt Issuances, and Equity Issuances that were
made during the prior fiscal year and amounts received in connection with any Recovery Event
during the prior fiscal year;

     (e) promptly upon receipt thereof, a copy or summary of any other report, or
“management letter” submitted or presented by independent accountants to the Borrower or any
of its Significant Subsidiaries in connection with any annual, interim or special audit of
the books of such Person;

     (f) promptly upon their becoming available, copies of any material non-routine
correspondence or official notices received by the Credit Parties or any of their
Subsidiaries from any federal, state or local governmental authority which regulates the
operations of the Credit Parties and their Significant Subsidiaries; and

     (g) promptly, such additional financial and other information as the Administrative
Agent, on behalf of any Lender, may from time to time reasonably request.

Documents required to be delivered pursuant to Section 5.1(a) or Section 5.1(b) may be
delivered electronically and if so delivered, shall be deemed to have been delivered on the
date received by the Administrative Agent by electronic mail with all relevant attachments.
The Administrative Agent may post such documents on the Borrower’s behalf on Syndtrak,
Intralinks or another relevant website, if any, to which each Lender and the Administrative
Agent have access (whether a commercial, third-party website or whether sponsored by the
Administrative Agent); provided that the Borrower shall deliver paper copies of such
documents to the Administrative Agent upon its request. Notwithstanding anything contained
herein, (A) the Borrower shall be entitled to deliver the compliance certificate required by
Section 5.2(b) by electronic mail and if so delivered shall be deemed to have been delivered
on the date received by the Administrative Agent by electronic mail with all relevant
attachments, and (B) whether or not delivery of any compliance certificate required by
Section 5.2(b) is effected pursuant to the preceding clause (A), the Borrower shall be
required to provide paper copies of the compliance certificates required by Section 5.2(b)
to the Administrative Agent.

     Section 5.3 Payment of Taxes; Other Obligations; Performance of Certain Other
Agreements.

     Pay, discharge or otherwise satisfy at or before maturity or before they become delinquent, as
the case may be, in accordance with industry practice (subject, where applicable, to specified
grace periods) all its material taxes (Federal, state, local and any other taxes) and other
obligations and liabilities of whatever nature and any additional costs that are imposed as a
result of any failure to so pay, discharge or otherwise satisfy such taxes, obligations and
liabilities, except when the amount or validity of any such taxes, obligations and liabilities is

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currently being contested in good faith by appropriate proceedings and reserves, if applicable, in
conformity with GAAP with respect thereto have been provided on the books of the Credit Parties.
Except as otherwise provided below, each Credit Party shall faithfully keep and perform, or cause
to be kept and performed, all of the covenants, conditions, and agreements contained in each
material lease (including any equipment lease), rental agreement, management contract, franchise
agreement, construction contract, technical services agreement or other material contract, license
or permit, now or hereafter existing, on the part of such Credit Party to be kept and performed
with respect to such Person’s real property subject to any Mortgage Instrument (including
performance of all covenants to be performed under any and all leases of such real property or any
part thereof) and shall at all times use commercially reasonable efforts to enforce, with respect
to each other party to said agreements, all obligations, covenants and agreements by such other
party to be performed thereunder; provided that a Credit Party shall not have any
obligation under this Section 5.3 unless such Credit Party’s performance or breach of its
obligations with respect to any such covenants, conditions or agreements could reasonably be
expected to have a Material Adverse Effect. Subject to the terms of Section 6.8, nothing in this
Section 5.3 should be interpreted or construed to impose any limit on the ability of any Credit
Party to modify, amend or terminate any such agreements without prior notice to or consent of the
Agent or the Lenders, so long as any such modification, amendment or termination could not
reasonably be expected to have a Material Adverse Effect. In the event of any conflict between the
provisions of this Section 5.3 and the provisions of any Mortgage Instrument, the provisions of
this Section 5.3 shall control.

     Section 5.4 Conduct of Business and Maintenance of Existence.

     Continue to engage in business of the same general type as now conducted by it on the Closing
Date and preserve, renew and keep in full force and effect its existence and good standing take all
reasonable action to maintain all rights, privileges and franchises necessary in the normal conduct
of its business; comply with all Contractual Obligations and Requirements of Law applicable to it
except to the extent that failure to comply therewith could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect.

     Section 5.5 Maintenance of Property; Insurance.

     (a) Keep all material property useful and necessary in its business in good working
order and condition (ordinary wear and tear and obsolescence excepted).

     (b) Maintain with financially sound and reputable insurance companies insurance on all
its property (including without limitation its tangible Collateral) in at least such amounts
and against at least such risks as are usually insured against in the same geographical area
by companies engaged in the same or a similar business (including, without limitation,
business interruption insurance); and furnish to the Administrative Agent, upon written
request, full information as to the insurance carried. Other than with respect to insurance
of a Permitted Real Estate Entity, the Administrative Agent shall be named as loss payee or
mortgagee, as its interest may appear, and the Administrative Agent shall be named as an
additional insured with respect to any such insurance providing coverage in respect of any
Collateral, and each provider of any such

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insurance shall agree, by endorsement upon the policy or policies issued by it or by
independent instruments furnished to the Administrative Agent, that it will give the
Administrative Agent thirty (30) days prior written notice before any such policy or
policies shall be altered or canceled, and that no act or default of any Credit Party or any
other Person shall affect the rights of the Administrative Agent or the Lenders under such
policy or policies.

     (c) In case of any material loss, damage to or destruction of the Collateral of any
Credit Party or any part thereof, such Credit Party shall promptly give written notice
thereof to the Administrative Agent generally describing the nature and extent of such
damage or destruction. In case of any loss, damage to or destruction of the Collateral of
any Credit Party or any part thereof, such Credit Party, whether or not the insurance
proceeds, if any, received on account of such damage or destruction shall be sufficient for
that purpose, at such Credit Party’s cost and expense, will promptly repair or replace the
Collateral of such Credit Party so lost, damaged or destroyed unless such Credit Party shall
have reasonably determined that such repair or replacement of the affected Collateral is not
economically feasible or is not deemed in the best business interest of such Credit Party.

     Section 5.6 Inspection of Property; Books and Records; Discussions.

     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 businesses and activities; and permit, during regular business hours and upon reasonable notice
by the Administrative Agent or any Lender, the Administrative Agent or 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, upon reasonable notice and as often as may reasonably be desired, and to
discuss the business, operations, properties and financial and other condition of the Credit
Parties with officers and employees of the Credit Parties and with their independent certified
public accountants (a representative of the Borrower may be present at any such meeting with the
independent certified public accountants).

     Section 5.7 Notices.

     (a) Promptly after any Credit Party obtains actual knowledge thereof, provide written
notice to the Administrative Agent (which shall transmit such notice to each Lender as soon
as practicable) of the occurrence of any Default or Event of Default.

     (b) Promptly (but in no event later than two (2) Business Days after any Credit Party
obtains actual knowledge thereof) provide written notice of the following to the
Administrative Agent (which shall transmit such notice to each Lender as soon as
practicable):

     (i) the occurrence of any default or event of default under any Contractual
Obligation of any of the Credit Parties which could reasonably be expected to have a
Material Adverse Effect or involve a monetary claim that

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could reasonably be expected to result in liability to the Credit Parties in excess
of $5,000,000;

     (ii) any litigation, or any investigation or proceeding (A) affecting any of
the Credit Parties which, if adversely determined, could reasonably be expected to
have a Material Adverse Effect or (B) affecting or with respect to this Credit
Agreement or any other Credit Document;

     (iii) (A) the occurrence or expected occurrence of any Reportable Event with
respect to any Plan, a failure to make any material required contribution to a Plan,
the creation of any Lien in favor of the PBGC (other than a Permitted Lien) or a
Plan or any withdrawal from, or the termination, Reorganization or Insolvency of,
any Multiemployer Plan or (B) the institution of proceedings or the taking of any
other action by the PBGC or any Credit Party or any Commonly Controlled Entity or
any Multiemployer Plan with respect to the withdrawal from, or the terminating,
Reorganization or Insolvency of, any Plan;

     (iv) any notice of any material violation received by any Credit Party from any
Governmental Authority including, without limitation, any notice of material
violation of Environmental Laws;

     (v) any labor controversy that has resulted in, or threatens to result in, a
strike or other work action against any Credit Party which could reasonably be
expected to have a Material Adverse Effect;

     (vi) any attachment, judgment, lien, levy or order exceeding $2,500,000 shall
be assessed against any Credit Party other than Permitted Liens;

     (vii) any of the events described in Section 7.1(f) with respect to a
Subsidiary that is not a Significant Subsidiary; and

     (viii) any other development or event which could reasonably be expected to
have a Material Adverse Effect.

     Each notice pursuant to this Section shall be accompanied by a statement of a Responsible
Officer setting forth details of the occurrence referred to therein and stating what action the
Borrower proposes to take with respect thereto. In the case of any notice of a Default or Event of
Default, the Borrower shall specify that such notice is a Default or Event of Default notice on the
face thereof.

     Section 5.8 Environmental Laws.

     (a) Comply in all material respects with all applicable Environmental Laws and obtain
and comply in all material respects with and maintain any and all licenses, approvals,
notifications, registrations or permits required by applicable Environmental

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Laws except, in each case, to the extent that failure to do so could not reasonably be
expected to have a Material Adverse Effect.

     (b) Conduct and complete all investigations, studies, sampling and testing, and all
remedial, removal and other actions required under Environmental Laws and comply in all
material respects with all lawful orders and directives of all Governmental Authorities
regarding Environmental Laws except to the extent that the same are being contested in good
faith by appropriate proceedings and the pendency of such proceedings could not reasonably
be expected to have a Material Adverse Effect.

     (c) Defend, indemnify and hold harmless the Administrative Agent and the Lenders, and
their respective employees, agents, officers and directors, from and against any and all
claims, demands, penalties, fines, liabilities, settlements, damages, costs and expenses of
whatever kind or nature known or unknown, contingent or otherwise, arising out of, or in any
way relating to the violation of, noncompliance with or liability under, any Environmental
Law applicable to the operations of the Credit Parties or the Properties, or any orders,
requirements or demands of Governmental Authorities related thereto, including, without
limitation, reasonable attorney’s and consultant’s fees, investigation and laboratory fees,
response costs, court costs and litigation expenses, except to the extent that any of the
foregoing arise out of the gross negligence, unlawful acts or willful misconduct of the
party seeking indemnification therefor. The agreements in this paragraph shall survive
repayment of the Notes and all other amounts payable hereunder.

     Section 5.9 Financial Covenants.

     Commencing on the day immediately following the Closing Date, each of the Credit Parties
shall, and shall cause each of its Subsidiaries to, comply with the following financial covenants
(which shall be calculated on a quarterly basis in connection with the delivery of the quarterly
compliance certificate required by Section 5.2(b)):

     (a) Leverage Ratio. The Leverage Ratio during the following periods shall be
less than or equal to:

	 	 	 	 	 
	Period	 	Maximum Ratio
	Closing Date through November 30, 2009
	 	 	5.75 to 1.0	 
	December 1, 2009 and thereafter
	 	 	5.50 to 1.0	 

     (b) Interest Coverage Ratio. The Interest Coverage Ratio shall be greater than
or equal 2.25 to 1.0.

     Notwithstanding the above, the parties hereto acknowledge and agree that, for purposes of all
calculations made in determining compliance for any applicable period with the financial covenants
set forth in this Section 5.9, after consummation of any Permitted Acquisition, (A) income
statement items and other balance sheet items (whether positive or negative) attributable to the
Target acquired in such transaction shall be included in such calculations to

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the extent relating to such applicable period, subject to adjustments mutually acceptable to the
Borrower and the Administrative Agent and (B) Indebtedness of a Target which is retired in
connection with a Permitted Acquisition shall be excluded from such calculations and deemed to have
been retired as of the first day of such applicable period.

     Section 5.10 Additional Guarantors.

     Except as provided in Section 5.16 of this Credit Agreement, the Credit Parties will cause
each of their Material Domestic Subsidiaries, whether newly formed, after acquired or otherwise
existing, to promptly (and in any event within thirty (30) days after such Material Domestic
Subsidiary is formed or acquired (or such longer period of time as agreed to by the Administrative
Agent in its reasonable discretion)) become a Guarantor hereunder by way of execution of a Joinder
Agreement or other guaranty agreement in form and substance satisfactory to the Administrative
Agent. In connection therewith, the Credit Parties shall give notice to the Administrative Agent
not less than ten (10) days prior to creating a Material Domestic Subsidiary (or such shorter
period of time as agreed to by the Administrative Agent in its reasonable discretion), or acquiring
the Capital Stock of any other Person. The Credit Party Obligations shall be secured by, among
other things, a first priority perfected security interest in the Collateral of such new Guarantor
and a pledge of 100% of the Capital Stock owned by a Credit Party of such new Guarantor and its
Domestic Subsidiaries and 65% (or such higher percentage that would not result in adverse tax
consequences for the Borrower or such new Guarantor) of the voting Capital Stock and 100% of the
non-voting Capital Stock of its first-tier Foreign Subsidiaries. In connection with the foregoing,
the Credit Parties shall deliver to the Administrative Agent, with respect to each new Guarantor to
the extent applicable, substantially the same documentation required pursuant to Sections
4.1(b)-(f) and 5.12 and such other documents or agreements as the Administrative Agent may
reasonably request.

     Section 5.11 Compliance with Law.

     Comply with all laws, rules, regulations and orders, and all applicable restrictions imposed
by all Governmental Authorities, applicable to it and its property if noncompliance with any such
law, rule, regulation, order or restriction could reasonably be expected to have a Material Adverse
Effect.

     Section 5.12 Pledged Assets.

     (a) Each Credit Party (other than a Permitted Real Estate Entity) will cause (i) 100%
of the Capital Stock owned by it of each of its direct or indirect Material Domestic
Subsidiaries (other than any Permitted Real Estate Entity) and 100% of the Capital Stock
owned by it of each of its first-tier Material Foreign Subsidiaries (not to exceed 65% of
the aggregate Capital Stock of such Material Foreign Subsidiary) and (ii) 100% of the
Capital Stock owned by the Borrower or any of its Subsidiaries of any Permitted Real Estate
Entity to be subject at all times to a first priority, perfected Lien in favor of the
Administrative Agent pursuant to the terms and conditions of the Security Documents or such
other security documents as the Administrative Agent shall reasonably request.

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     (b) If, subsequent to the Closing Date, a Credit Party (other than a Permitted Real
Estate Entity) shall acquire any real property or any securities, instruments, chattel paper
or other personal property required for perfection to be delivered to the Administrative
Agent as Collateral hereunder or under any of the Security Documents, the Borrower shall
promptly (and in any event within three (3) Business Days) after any Responsible Officer of
a Credit Party acquires knowledge of same notify the Administrative Agent of same. Each
Credit Party shall, and shall cause each of its Subsidiaries to, take such action at its own
expense as reasonably requested by the Administrative Agent (including, without limitation,
any of the actions described in Section 4.1(d) or (e) hereof) to ensure that the
Administrative Agent has a first priority perfected Lien to secure the Credit Party
Obligations (subject to Permitted Liens) in (i) all personal property of the Credit Parties
located in the United States (including, without limitation, take all actions necessary
under the Federal Assignment of Claims Act to ensure the Administrative Agent has a first
priority perfected Lien on any government receivables), (ii) to the extent deemed to be
material by the Administrative Agent or the Required Lenders in its or their reasonable
discretion, all other personal property of the Credit Parties, subject in each case only to
Permitted Liens, and (iii) to the extent deemed to be material by the Administrative Agent
or the Required Lenders in its or their reasonable discretion, such real property of the
Credit Parties located in the United States. Each Credit Party shall, and shall cause each
of its Subsidiaries to, adhere to the covenants regarding the location of personal property
as set forth in the Security Documents.

     Section 5.13 Covenants Regarding Patents, Trademarks and Copyrights.

     (a) Concurrently with the delivery of quarterly and annual financial statements of the
Borrower pursuant to Sections 5.1 and 5.2 hereof, the Borrower shall notify the
Administrative Agent if it knows or has reason to know that any application, letters patent
or registration relating to any material Patent, Patent License, Trademark or Trademark
License of the Credit Parties or any of their Subsidiaries may become abandoned, or of any
adverse determination or development (including, without limitation, the institution of, or
any such determination or development in, any proceeding in the United States Patent and
Trademark Office or any court) regarding the Borrower’s or any of its Subsidiary’s ownership
of any material Patent or Trademark, its right to patent or register the same, or to
enforce, keep and maintain the same, or its rights under any material Patent License or
Trademark License.

     (b) Concurrently with the delivery of quarterly and annual financial statements of the
Borrower pursuant to Sections 5.1 and 5.2 hereof, the Borrower shall notify the
Administrative Agent after it knows or has reason to know of any adverse determination or
development (including, without limitation, the institution of, or any such determination or
development in, any proceeding in any court) regarding any material Copyright or Copyright
License of the Credit Parties or any of their Subsidiaries, whether (i) such material
Copyright or Copyright License may become invalid or unenforceable prior to its expiration
or termination, or (ii) the Borrower’s or any of its Subsidiary’s ownership of such material
Copyright, its right to register the same or to

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enforce, keep and maintain the same, or its rights under such material Copyright License,
may become affected.

(c)  (i) Concurrently with the delivery of quarterly and annual financial statements
of the Borrower pursuant to Sections 5.1 and 5.2 hereof, the Borrower shall notify
the Administrative Agent of any filing by any Credit Party or any of its
Subsidiaries (other than a Permitted Real Estate Entity), either itself or through
any agent, employee, licensee or designee, of any application for registration of
any Intellectual Property (other than Intellectual Property of de minimus value)
with the United States Copyright Office or United States Patent and Trademark Office
or any similar office or agency in any other country or any political subdivision
thereof.

     (ii) Concurrently with the delivery of quarterly and annual financial
statements of the Borrower pursuant to Sections 5.1 and 5.2 hereof, the Borrower
shall provide the Administrative Agent and its counsel a complete and correct list
in all material respects of all new Copyright Licenses, Patent Licenses and
Trademark Licenses (other than Copyright Licenses, Patent Licenses and Trademark
Licenses of de minimus value) not previously disclosed on Schedule 3.16 or
otherwise disclosed to the Administrative Agent pursuant to this Section
5.13(c)(ii).

     (iii) Upon request of the Administrative Agent, the Borrower shall execute and
deliver any and all agreements, instruments, documents, and papers as the
Administrative Agent may reasonably request to evidence the Administrative Agent’s
security interest in the Intellectual Property and the general intangibles (other
than Intellectual Property of de minimus value) referred to in clauses (i) and (ii),
including, without limitation, the goodwill of the Borrower or its Subsidiaries
relating thereto or represented thereby (or such other Intellectual Property or the
general intangibles relating thereto or represented thereby as the Administrative
Agent may reasonably request).

     (d) The Credit Parties and their Subsidiaries will take all necessary actions,
including, without limitation, in any proceeding before the United States Patent and
Trademark Office or the United States Copyright Office, to maintain each material item of
Intellectual Property of the Credit Parties and their Subsidiaries, including, without
limitation, payment of maintenance fees, filing of applications for renewal, affidavits of
use, affidavits of incontestability and opposition, interference and cancellation
proceedings; provided that the Credit Parties shall have the right to abandon any
item of Intellectual Property which the Borrower determines is no longer of significant
value or useful or necessary to the business of the Borrower and its Subsidiaries.

     (e) In the event that any Credit Party becomes aware that any material Intellectual
Property is infringed, misappropriated or diluted by a third party in any material respect,
the Credit Parties shall notify the Administrative Agent promptly after it learns thereof
and shall, unless the Credit Parties shall reasonably determine that such

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Intellectual Property is not material to the business of the Credit Parties and their
Subsidiaries taken as a whole or as to which the Credit Parties reasonably conclude that the
cost of such proceeding or its likelihood of success does not justify its prosecution,
promptly sue for infringement, misappropriation or dilution and to recover any and all
damages for such infringement, misappropriation or dilution, and take such other actions as
the Credit Parties shall reasonably deem appropriate under the circumstances to protect such
Intellectual Property.

     Section 5.14 Landlord Waivers.

     In the case of any personal property Collateral located at premises leased by a Credit Party,
the Credit Parties will provide the Administrative Agent with such estoppel letters, consents and
waivers from the landlords on such real property to the extent (a) requested by the Administrative
Agent and (b) the Borrower is able to secure such letters, consents and waivers after using
commercially reasonable efforts (such letters, consents and waivers shall be in form and substance
reasonably satisfactory to the Administrative Agent).

     Section 5.15 Further Assurances/Post-Closing Covenants.

     (a) Public/Private Designation. The Borrower will cooperate with the
Administrative Agent in connection with the publication of certain materials and/or
information provided by or on behalf of the Borrower to the Administrative Agent and Lenders
(collectively, “Information Materials”) pursuant to this Article V and will
designate Information Materials (i) that are either available to the public or not material
with respect to the Borrower and its Subsidiaries or any of their respective securities for
purposes of United States federal and state securities laws, as “Public Information”
and (ii) that are not Public Information as “Private Information”.

     (b) Further Assurances. Upon the reasonable request of the Administrative
Agent, promptly perform or cause to be performed any and all acts and execute or cause to be
executed any and all documents for filing under the provisions of the Uniform Commercial
Code or any other Requirement of Law which are necessary or advisable to maintain in favor
of the Administrative Agent, for the benefit of the Secured Parties, Liens on the Collateral
that are duly perfected in accordance with the requirements of, or the obligations of the
Credit Parties under, the Credit Documents and all applicable Requirements of Law.

     (c) Intellectual Property. Within sixty days (60) days after the Closing Date
(or such extended period of time as agreed to by the Administrative Agent), to the extent
required by the Administrative Agent, the Credit Parties shall provide evidence satisfactory
to the Administrative Agent, in form and substance reasonably satisfactory to the
Administrative Agent, that all chain of title issues (including unreleased security
interests related to Liens that have previously been terminated) with respect to
the Intellectual Property have been corrected in the appropriate records of the United
States Patent and Trademark Office.

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     (d) Account Control Agreements. Within sixty (60) days after the Closing Date
(or such extended period of time as agreed to by the Administrative Agent), the Credit
Parties shall deliver to the Administrative Agent, to the extent required by Section 6.14
and not delivered to the Administrative Agent on or prior to the Closing Date, such duly
executed account control agreements with respect to Collateral for which a control agreement
is required for perfection of the Administrative Agent’s security interest under the Uniform
Commercial Code.

     (e) Mortgage Documents. Within ninety (90) days after the Closing Date (or
such extended period of time as agreed to by the Administrative Agent), the Administrative
Agent shall have received all of the documentation required by Section 4.1(e) with respect
to the real property located in Orange County, VA.

     Section 5.16 Permitted Real Estate Entities.

     (a) Designation. The Borrower may designate a Subsidiary as a Permitted Real
Estate Entity (the “Initial Permitted Real Estate Entity”) in connection with the
Initial Real Estate Transaction (as defined below). At any time and from time to time
thereafter, the Borrower may designate one or more Subsidiaries as Permitted Real Estate
Entities so long as the Borrower is in compliance with Section 6.1(k) of this Credit
Agreement and clause (m) of the definition of “Permitted Investments” both before and after
giving effect to such designation. Subject to clause (d) below, a Credit Party may own all
or any portion of the Capital Stock and Voting Securities of a Permitted Real Estate Entity.

     (b) Guaranty Requirement. So long as a Permitted Real Estate Entity is not a
guarantor under any Existing Subordinated Notes, any other Subordinated Debt, any senior
notes or any other material Indebtedness of a Credit Party, such Permitted Real Estate
Entity shall not be required to comply with Section 5.10 of this Credit Agreement and be a
Guarantor hereunder.

     (c) Collateral Matters.

     (i) Prior to the first anniversary of the Closing Date, the real property set
forth on Schedule 1.1(f) (as such schedule may be updated from time to time
with the consent of the Administrative Agent) may be contributed (the “Initial
Real Estate Transaction”) to the Initial Permitted Real Estate Entity and such
Initial Real Estate Transaction shall not be subject to the Loan to Value Test;
provided that to the extent the Initial Real Estate Transaction has not
occurred prior to the first anniversary of the Closing Date, the Credit Parties will
grant Liens to the Administrative Agent on certain owned real property set forth on
Schedule 1.1(f) (as such schedule may be updated from time to time with the
consent of the Administrative Agent) (and deliver such other documentation required
by the Administrative Agent consistent with the requirements set forth in Section
4.1(e)) to secure the Credit Party Obligations, with exceptions to be determined by
the Administrative Agent in its reasonable discretion;

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     (ii) In addition to contributions set forth in clause (c)(i) above, the Credit
Parties may make additional Permitted Real Estate Transfers subject to compliance by
the Borrower with the Loan to Value Test (to the extent applicable) after giving
effect to any such Permitted Real Estate Transfer.

     (iii) Liens in favor of the Administrative Agent with respect to real property
owned by a Credit Party or a Permitted Real Estate Entity shall be released in
connection with any Permitted Real Estate Transfers permitted by subclauses (i) and
(ii) above.

     (d) Initial Ownership Requirement. Notwithstanding the foregoing clauses (a) –
(c), the Credit Parties shall own collectively, more than 50% of the Capital Stock and
Voting Securities of each Permitted Real Estate Entity (including the Initial Permitted Real
Estate Entity) and each Subsidiary or other entity in which a Permitted Real Estate Entity
holds directly or indirectly an ownership interest until approximately 2200 acres of the Rio
Del Oro Property is subject to the issuance by the California Environmental Protection
Agency, Department of Toxic Substances Control, of a certification of completion pursuant to
that certain Imminent and/or Substantial Endangerment Determination and Consent dated June
30, 1994 or otherwise released pursuant thereto, in each case, on terms that do not
materially adversely impact the value of such Property.

     Notwithstanding any term of this Article V (or the definition of any defined term used in this
Article V) to the contrary and notwithstanding the status of any Permitted Real Estate Entity as a
consolidated Subsidiary of the Borrower, the affirmative covenants set forth in this Article V
(other than the covenants set forth in Sections 5.4, 5.8 and 5.11 and the defined terms used in
such Sections) shall not apply to or be construed to include any Permitted Real Estate Entity
unless such Permitted Real Estate Entity is a Guarantor hereunder.

ARTICLE VI

NEGATIVE COVENANTS

     The Credit Parties hereby covenant and agree that on the Closing Date, and thereafter for so
long as this Credit Agreement is in effect and until the Commitments have terminated and the Credit
Party Obligations under the Credit Documents have been paid in full, that:

     Section 6.1 Indebtedness.

     The Credit Parties will not, nor will they permit any Subsidiary or Permitted Real Estate
Entity to, contract, create, incur, assume or permit to exist any Indebtedness, except:

     (a) Indebtedness arising or existing under this Credit Agreement and the other Credit
Documents;

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     (b) Indebtedness of the Credit Parties and their Subsidiaries existing as of the
Closing Date as set forth on Schedule 6.1(b) and any renewals, refinancings or
extensions thereof; provided, however, that (i) subject to clause (ii)
below, the principal amount of such Indebtedness as renewed, refinanced or extended (as
determined as of the date of the renewal, refinancing or extension of such Indebtedness in
accordance with GAAP), does not exceed the principal amount of the Indebtedness refinanced
thereby on such date plus costs and fees incurred in connection with such renewal,
refinancing or extension, (ii) if such Indebtedness is owed by a Credit Party to a
Subsidiary that is not a Credit Party, such Indebtedness shall not be repaid in cash or Cash
Equivalents and shall not be renewed, extended, refinanced or replaced, (iii) the Weighted
Average Life to Maturity of such Indebtedness is not decreased and (iv) in the case of any
such Indebtedness, as renewed, refinanced or extended, which is in excess of $5,000,000,
such Indebtedness is upon terms and subject to documentation which is in form and substance
reasonably satisfactory to the Administrative Agent;

     (c) Indebtedness of the Credit Parties and their Subsidiaries (other than Permitted
Real Estate Entities) incurred or acquired after the Closing Date consisting of Capital
Leases or Indebtedness incurred to provide all or a portion of the purchase price or cost of
construction of an asset; provided that (i) no such Indebtedness shall be refinanced
for a principal amount in excess of the principal balance outstanding thereon at the time of
such refinancing; and (ii) the aggregate amount of such Indebtedness outstanding at any
time, together with Indebtedness outstanding and permitted by Section 6.1(d) (without double
counting) shall not exceed $15,000,000;

     (d) Indebtedness of a Subsidiary of the Borrower issued and outstanding on or prior to
the date on which such Subsidiary was acquired by the Borrower or a Subsidiary of the
Borrower in a transaction constituting a Permitted Acquisition (other than Indebtedness
issued as consideration in, or to provide all or any portion of the funds utilized to
consummate such Permitted Acquisition) and any extension, renewal or replacement thereof
(including costs and fees incurred in connection with such extension, renewal or
replacement); provided, that the aggregate amount of such Indebtedness outstanding
at any time shall not exceed $25,000,000;

     (e) Indebtedness of the Credit Parties and their Subsidiaries (other than the Permitted
Real Estate Entities) pursuant to the Existing Subordinated Notes; provided that the
Existing Subordinated Notes may be refinanced (including costs and fees) or extended so long
as (i) no Default or Event of Default shall have occurred and be continuing or would result
therefrom, (ii) the principal amount of such Existing Subordinated Notes will not be
increased in connection with such refinancing or extension (except by an amount equal to the
costs and fees incurred in connection with such refinancing or extension), (iii) the terms
of the refinanced or extended notes shall be reasonably satisfactory to the Administrative
Agent and shall be substantially similar or more favorable to the Credit Parties and their
Subsidiaries (and the subordination terms thereof shall be substantially similar or more
favorable to the Lenders) than the Existing Subordinated Notes, (iv) the maturity date of
such refinanced or extended notes shall be

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at least six (6) months after the Credit-Linked Maturity Date and (v) the Weighted Average
Life to Maturity of such refinanced or extended notes is not decreased;

     (f) unsecured Indebtedness incurred by the Credit Parties (other than Permitted Real
Estate Entities) and owed to any Credit Party; provided, however, that in
the case of such intercompany Indebtedness consisting of a loan or advance by a Credit Party
to another Credit Party, each such loan shall be evidenced by an Intercompany Note payable
to the Credit Party, in form and substance satisfactory to Administrative Agent, which
Intercompany Notes shall be delivered and pledged to the Administrative Agent as part of the
Collateral;

     (g) Indebtedness and obligations owing under Secured Hedging Agreements and other
Hedging Agreements entered into in order to manage existing or anticipated interest rate or
currency exchange rate risks and not for speculative purposes;

     (h) Indebtedness of the Credit Parties and their Subsidiaries (other than the Permitted
Real Estate Entities) consisting of unsecured Guaranty Obligations incurred to satisfy
bonding obligations not in excess of $5,000,000 at any one time which arise in the ordinary
course of business;

     (i) Indebtedness of the Borrower consisting of unsecured Guaranty Obligations in favor
of the United States Environmental Protection Agency which are incurred on behalf of Aerojet
in connection with environmental remediation; provided, that such Guaranty
Obligations permitted under this subsection shall not at any time exceed $120,000,000;

     (j) additional unsecured Indebtedness for money borrowed of the Credit Parties and
their Subsidiaries (other than the Permitted Real Estate Entities) not otherwise covered by
the subsections set forth above; provided that the aggregate outstanding principal
amount of all such other Indebtedness permitted under this subsection shall in no event
exceed $20,000,000 at any time;

     (k) secured or unsecured Indebtedness of Permitted Real Estate Entities in an aggregate
amount not to exceed (i) $25,000,000 prior to entitlement of all or substantially all of the
real property owned by the Permitted Real Estate Entities, (ii) $62,500,000 to the extent
(A) both Parcel 1 and Parcel 2 as set forth on Schedule 1.1(f) are entitled, (B)
Parcel 3 as set forth on Schedule 1.1(f) is entitled or (C) other real property with
a documented value substantially equal to the values of the real property set forth in (A)
or (B) above and otherwise acceptable to the Administrative Agent is entitled and, in each
case, released from any material restrictions on development and (iii) $100,000,000 after
entitlement of all or substantially all of the real property owned by the Permitted Real
Estate Entities, in each case, to the extent such Indebtedness is non-recourse to the Credit
Parties (other than the applicable Permitted Real Estate Entity); and

     (l) Guaranty Obligations in respect of Indebtedness of a Credit Party (other than a
Permitted Real Estate Entity) to the extent such Indebtedness is permitted to exist

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or be incurred pursuant to this Section 6.1 and any renewal, refinancing or extension of
such Guaranty Obligations to the extent such Indebtedness is permitted to be renewed,
refinanced or extended hereunder; provided that if the Indebtedness with respect to
which such Guaranty Obligations relate is unsecured, such Guaranty Obligations shall also be
unsecured.

     Section 6.2 Liens.

     The Credit Parties will not, nor will they permit any Subsidiary or Permitted Real Estate
Entity to, contract, create, incur, assume or permit to exist any Lien with respect to any of their
respective property or assets of any kind (whether real or personal, tangible or intangible),
whether now owned or hereafter acquired, except for Permitted Liens.

     Section 6.3 Nature of Business.

     The Credit Parties will not, nor will they permit any Subsidiary to, alter the character of
the business of the Credit Parties and their Subsidiaries, taken as a whole, in any material
respect from that conducted as of the Closing Date (including the monetization of real estate).

     Section 6.4 Consolidation, Merger, Sale or Purchase of Assets, etc.

     The Credit Parties will not, nor will they permit any Subsidiary to:

     (a) dissolve, liquidate or wind up its affairs, consolidate or merge with another
Person, or sell, transfer, lease or otherwise dispose of its property or assets or agree to
do so at a future time except the following, without duplication, shall be expressly
permitted:

     (i) Specified Sales;

     (ii) the disposition of property or assets as a result of a Recovery Event to
the extent the Net Cash Proceeds therefrom are used to repay Loans pursuant to
Section 2.9(b)(vii) or repair or replace damaged property or to purchase or
otherwise acquire new assets or property in accordance with the terms of Section
2.9(b)(vii);

     (iii) the sale, lease or transfer of property or assets from a Credit Party to
another Credit Party (other than a Permitted Real Estate Entity); provided
that prior to or simultaneously with any such sale, lease or transfer, all actions
required by the Administrative Agent shall be taken to insure the continued
perfection and priority of the Administrative Agent’s Liens on such property and
assets;

     (iv) the consolidation, liquidation or merger of a Credit Party into another
Credit Party (other than a Permitted Real Estate Entity) or any Subsidiary into a
Credit Party (other than a Permitted Real Estate Entity); provided that (A)

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prior to or simultaneously with any such consolidation, liquidation or merger, all
actions required by the Administrative Agent shall be taken to insure the continued
perfection and priority of the Administrative Agent’s Liens on the property and
assets of each such Credit Party and (B) if such consolidation, liquidation or
merger involves the Borrower, the Borrower shall be the surviving entity;

     (v) the dissolution, liquidation or winding up of a Subsidiary that is not a
Credit Party; provided that prior to or simultaneously with any such
dissolution, liquidation or winding up, all assets of such Subsidiary are
transferred to a Credit Party (other than a Permitted Real Estate Entity) or, to the
extent required by law or binding contract, a creditor or creditors thereof;

     (vi) the termination of any Hedging Agreement permitted pursuant to Section
6.1;

     (vii) the Borrower and its Subsidiaries may sell or discount, in each case
without recourse and in the ordinary course of business, accounts receivable arising
in the ordinary course of business (A) which are overdue, or (B) which the Borrower
or such Subsidiary may reasonably determine are difficult or uneconomic to collect
but only in connection with the compromise or collection thereof consistent with
customary industry practice (and not as part of any bulk sale or financing of
receivables);

     (viii) the Borrower and its Subsidiaries may license its patents, trade
secrets, know-how and other intellectual property (the “Technology”);
provided that such license shall be assignable to the Administrative Agent
or any assignee of the Administrative Agent without the consent of the licensee and
no such license shall (A) transfer ownership of such Technology to any other Person
or (B) require the Borrower to pay any fees for any such use;

     (ix) the grant of certain rights pertaining to “Aggregates” to Granite
Construction Company pursuant to the Agreement Granting Right to Mine Aggregates
dated November 18, 2004 (the “Granite Agreement”);

     (x) the sale of real property and related assets by Permitted Real Estate
Entities;

     (xi) the sale of any Capital Stock or other equity interests of any Permitted
Real Estate Entity;

     (xii) Permitted Real Estate Sales;

     (xiii) Permitted Real Estate Transfers;

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     (xiv) the sale, transfer or other disposition of any assets that are obsolete,
worn out or no longer useful in any Credit Party’s or Subsidiary’s business; and

     (xv) the sale, transfer, lease or other disposition of any other assets,
provided that the aggregate Net Cash Proceeds received from the sale of all
assets subject to this subsection which are not reinvested to acquire assets to be
used in such Person’s business shall not exceed $20,000,000 in any fiscal year of
the Borrower;

provided, that, with respect to subsections (i), (ii), (vii), (viii) and (xv) above,
at least 75% of the consideration received therefor by such Credit Party, Subsidiary or
Permitted Real Estate Entity shall be in the form of cash or Cash Equivalents; and,
provided, further, that the non-cash portion of any such consideration shall
be in compliance with the provisions of Section 6.5 hereof; or

     (b) purchase, lease or otherwise acquire (in a single transaction or a series of
related transactions) the property or assets of any Person (other than purchases or other
acquisitions of inventory, leases, materials, property and equipment in the ordinary course
of business, except as otherwise limited or prohibited herein), except for (i) transactions
permitted pursuant to Section 6.4(a), (ii) Investments permitted pursuant to Section 6.5 and
(iii) Permitted Acquisitions.

     Section 6.5 Advances, Investments and Loans.

     The Credit Parties will not, nor will they permit any Subsidiary to, lend money or extend
credit or make advances to any Person, or purchase or acquire any stock, obligations or securities
of, or any other interest in, or make any capital contribution to, any Person except for Permitted
Investments.

     Section 6.6 Transactions with Affiliates.

     The Credit Parties will not, nor will they permit any Subsidiary or Permitted Real Estate
Entity to, enter into any transaction or series of transactions (other than compensation, bonus and
benefit arrangements for employees approved by the board of directors of the Borrower, and
reasonable and customary directors’ fees, indemnification and similar arrangements and payments
thereunder), whether or not in the ordinary course of business, with any officer, director,
shareholder or Affiliate other than on terms and conditions substantially as favorable as would be
obtainable in a comparable arm’s-length transaction with a Person other than an officer, director,
shareholder or Affiliate.

     Section 6.7 Ownership of Subsidiaries; Restrictions.

     The Credit Parties will not, nor will they permit any Subsidiary to, create, form or acquire
any Subsidiaries, except for (a) Material Domestic Subsidiaries which are joined as Additional
Credit Parties in accordance with the terms hereof, (b) Domestic Subsidiaries formed or acquired

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as a Permitted Investment or otherwise approved by the Administrative Agent and (c) Foreign
Subsidiaries formed or acquired as a Permitted Investment or otherwise approved by the
Administrative Agent; provided that the Credit Parties and their Subsidiaries may form or
otherwise create any Permitted Real Estate Entity so long as, prior to such formation or creation,
the Administrative Agent is satisfied with the corporate and capital structure of such Permitted
Real Estate Entity. The Credit Parties will not sell, transfer, pledge or otherwise dispose of any
Capital Stock or other equity interests in any of its Subsidiaries, nor will it permit any of its
Subsidiaries to issue, sell, transfer, pledge or otherwise dispose of any of their Capital Stock or
other equity interests, except in a transaction permitted by Section 6.4(a).

     Section 6.8 Fiscal Year; Organizational Documents; Material Contracts; Accounting
Policies.

     (a) No Credit Party will, nor will they permit any of its Subsidiaries to, (i) change
its fiscal year, (ii) amend, modify or change its articles of incorporation, certificate of
designation (or corporate charter or other similar organizational document), operating
agreement, bylaws (or other similar document) or other agreements related to its Capital
Stock in any respect adverse to the interests of the Lenders without the prior written
consent of the Required Lenders, (iii) amend, modify, cancel or terminate or fail to renew
or extend (if renewable or extendable by its terms) or permit the amendment, modification,
cancellation or termination of any of its Material Contracts in any respect materially
adverse to the interests of the Lenders without the prior written consent of the Required
Lenders, or (iv) change its state of incorporation, organization or formation or have more
than one state of incorporation, organization or formation.

     (b) The Borrower shall not, nor shall it permit any of its Subsidiaries to make or
permit to be made any change in accounting policies affecting the presentation of financial
statements or reporting practices from those employed by it on the date hereof; unless (i)
such change is required or permitted by GAAP and (ii) such change is disclosed to the
Lenders through the Administrative Agent or otherwise.

     Section 6.9 Limitation on Restricted Actions and Impediments to Foreclosure.

     (a) The Credit Parties will not, nor will they permit any Subsidiary or Permitted Real
Estate Entity to, directly or indirectly, create or otherwise cause or suffer to exist or
become effective any encumbrance or restriction on the ability of any such Person to (a) pay
dividends or make any other distributions to any Credit Party on its Capital Stock or with
respect to any other interest or participation in, or measured by, its profits, (b) pay any
Indebtedness or other obligation owed to any Credit Party, (c) make loans or advances to any
Credit Party, (d) sell, lease or transfer any of its properties or assets to any Credit
Party, or (e) act as a Guarantor or encumber its assets to the extent required by the Credit
Documents, except (in respect of any of the matters referred to in clauses (a)-(d) above)
for such encumbrances or restrictions existing under or by reason of (i) this Credit
Agreement and the other Credit Documents, (ii) applicable law and regulations, (iii) any
document or instrument governing Indebtedness incurred pursuant to Section 6.1(c);
provided that any such restriction contained therein relates only to the

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asset or assets constructed or acquired in connection therewith, (iv) any Permitted Lien or
any document or instrument governing any Permitted Lien; provided that any such
restriction contained therein relates only to the asset or assets subject to such Permitted
Lien, (v) any such encumbrance or restriction consisting of customary non-assignment
provisions in leases or licenses restricting leasehold interests or licenses, as applicable,
entered into in the ordinary course of business or (vi) with respect to a Permitted Real
Estate Subsidiary, customary provisions in joint venture agreements and other similar
agreements that restrict the transfer of ownership interests in such joint venture or
provisions limiting the disposition or distribution of assets or property (other than
dividends on a pro rata basis based on ownership percentage), which limitation is applicable
only to the assets that are the subject of such agreements.

     (b) The Credit Parties will not, nor will they permit any Subsidiary or Permitted Real
Estate Entity to, directly or indirectly, create or otherwise cause or suffer to exist or
become effective any encumbrance or restriction on the ability of the Administrative Agent
to foreclose on, or exercise any other remedy with respect to, the Capital Stock of such
Credit Party, Subsidiary or Permitted Real Estate Entity that is pledged to the
Administrative Agent pursuant to a Security Document in accordance with the terms of the
Credit Documents, except for such encumbrances or restrictions existing under or by reason
of applicable law and regulations.

     Section 6.10 Restricted Payments.

     The Credit Parties will not, nor will they permit any Subsidiary to, directly or indirectly,
declare, order, make or set apart any sum for or pay any Restricted Payment, except (a) to make
dividends payable solely in the same class of Capital Stock of such Person, (b) to make dividends
or other distributions payable to the Borrower (directly or indirectly through its Subsidiaries)
and, in the case of a Restricted Payment by a Permitted Real Estate Entity, to the Borrower
(directly or indirectly through its Subsidiaries) and to each other owner of Capital Stock of such
Permitted Real Estate Entity on a pro rata basis based on their relative ownership
interests, (c) subject to the subordination terms of such Subordinated Debt, (i) to make regularly
scheduled interest payments on the Existing Subordinated Notes, (ii) so long as no Event of Default
has occurred and is continuing and no Default or Event of Default would result therefrom, to
refinance the Existing Subordinated Notes on substantially similar or more favorable terms to the
Lenders and on terms reasonably satisfactory to the Administrative Agent, and (iii) so long as (A)
no Default or Event of Default has occurred and is continuing or would result therefrom and (B) the
Borrower has cash and Cash Equivalents of not less than $25,000,000 after giving effect to any such
Restricted Payments, to redeem (with funds other than Loan proceeds) the 4.00% Convertible Notes
and/or the 2.25% Convertible Notes to the extent required by the mandatory redemption provisions of
the indentures therefor as in effect on the Closing Date, (d) so long as no Event of Default has
occurred and is continuing and no Default or Event of Default would result therefrom, to pay
earnout obligations incurred as part of the consideration for a Permitted Acquisition and (e) so
long as no Default or Event of Default has occurred and is continuing and no Default or Event of
Default would result therefrom, to repurchase Capital Stock upon the termination of employment,
death, permanent disability or

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retirement of employees or management in an aggregate amount not to exceed $2,000,000 annually.

     Section 6.11 Amendment of Subordinated Debt.

     The Credit Parties will not, nor will it permit any Subsidiary to, without the prior written
consent of the Required Lenders, amend, modify, waive or extend or permit the amendment,
modification, waiver or extension of any term of any document governing or relating to any
Subordinated Debt (including, without limitation, the Existing Subordinated Notes) in a manner that
is adverse to the interests of the Lenders.

     Section 6.12 Sale Leasebacks.

     The Credit Parties will not, nor will they permit any Subsidiary to, directly or indirectly,
become or remain liable as lessee or as a guarantor or other surety with respect to any lease,
whether an operating lease or a Capital Lease, of any property (whether real, personal or mixed),
whether now owned or hereafter acquired, (a) which any Credit Party or any of their Subsidiaries
has sold or transferred or is to sell or transfer to any other Person (other than the Borrower or
any of its Subsidiaries) or (b) which the Borrower or any of its Subsidiaries intends to use for
substantially the same purpose as any other property which has been or is to be sold or transferred
by the Borrower or any of its Subsidiaries to any Person (other than the Borrower or any of its
Subsidiaries) in connection with such lease, except for such sale leasebacks in the amount of
$15,000,000 in the aggregate during the term of this Agreement.

     Section 6.13 No Further Negative Pledges.

     The Credit Parties will not, nor will they permit any Subsidiary or Permitted Real Estate
Entity to, enter into, assume or become subject to any agreement prohibiting or otherwise
restricting the creation or assumption of any Lien upon its properties or assets, whether now owned
or hereafter acquired, or requiring the grant of any security for such obligation if security is
given for some other obligation, except (a) pursuant to this Credit Agreement and the other Credit
Documents and (b) pursuant to any document or instrument governing Indebtedness incurred pursuant
to Section 6.1(c); provided that any such restriction contained therein relates only to the
asset or assets constructed or acquired in connection therewith, and (c) in connection with any
Permitted Lien or any document or instrument governing any Permitted Lien; provided that
any such restriction contained therein relates only to the asset or assets subject to such
Permitted Lien.

     Section 6.14 Accounts.

     The Credit Parties and their Significant Subsidiaries will not maintain deposit and securities
accounts (other than pension accounts) with Persons, other than the Administrative Agent, the
Lenders and other Persons that have entered into a control agreement with the Administrative Agent,
in form and substance satisfactory to the Administrative Agent, with respect to the accounts held
with such Person, that contain an aggregate balance at any time of more than $10,000,000.

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     Notwithstanding any term of this Article VI (or the definition of any defined term used in
this Article VI) to the contrary and notwithstanding the status of any Permitted Real Estate Entity
as a consolidated Subsidiary of the Borrower, the negative covenants set forth in this Article VI
(other than the negative covenants set forth in Sections 6.1, 6.2, 6.6, 6.9 and 6.13 and the
defined terms used in such Sections) shall not apply to or be construed to include any Permitted
Real Estate Entity unless such Permitted Real Estate Entity is a Guarantor hereunder.

ARTICLE VII

EVENTS OF DEFAULT

     Section 7.1 Events of Default.

     An Event of Default shall exist upon the occurrence of any of the following specified events
(each an “Event of Default”):

     (a) Payment Default. The Borrower shall fail to pay any principal on any Loan
or Note when due (whether at maturity, by reason of acceleration or otherwise) in accordance
with the terms thereof or hereof; or the Borrower shall fail to reimburse any Revolving
Issuing Lender or any Credit-Linked Issuing Lender, as appropriate, for any LOC Obligations
or any Credit-Linked LOC Obligations when due (whether at maturity, by reason of
acceleration or otherwise) in accordance with the terms hereof; or the Borrower shall fail
to pay any interest on any Loan or Note or any fee or other amount payable hereunder when
due (whether at maturity, by reason of acceleration or otherwise) in accordance with the
terms thereof or hereof and such failure shall continue unremedied for three (3) Business
Days; or any Guarantor shall fail to pay on the Guaranty in respect of any of the foregoing
or in respect of any other Guaranty Obligations thereunder.

     (b) Misrepresentation. Any representation or warranty made or deemed made
herein, in the Security Documents or in any of the other Credit Documents or which is
contained in any certificate, document or financial or other statement furnished at any time
under or in connection with this Credit Agreement shall prove to have been incorrect, false
or misleading in any material respect on or as of the date made or deemed made.

     (c) Covenant Default. (i) Any Credit Party shall fail to perform, comply with
or observe any term, covenant or agreement applicable to it contained in Sections 5.4, 5.7,
5.9 or Article VI hereof; (ii) any Credit Party shall fail to perform, comply with or
observe any term, covenant or agreement applicable to it contained in Sections 5.1(a),
5.1(b), 5.2(b), 5.2(d) or 5.2(e) and such breach or failure to comply is not cured within
five (5) days of its occurrence or (iii) any Credit Party shall fail to comply with any
other covenant contained in this Credit Agreement or the other Credit Documents or any other
agreement, document or instrument among any Credit Party, the Administrative Agent and the
Lenders or executed by any Credit Party in favor of the Administrative Agent or

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the Lenders (other than as described in Sections 7.1(a) or 7.1(c)(i) above), and such breach
or failure to comply is not cured within thirty (30) days of its occurrence.

     (d) Debt Cross-Default. Any Credit Party or any Subsidiary thereof shall (i)
default in any payment of principal of or interest on any Indebtedness (other than the
Loans, Reimbursement Obligations and the Guaranty) in a principal amount outstanding of at
least $5,000,000 for the Credit Parties and their Subsidiaries in the aggregate beyond any
applicable grace period (not to exceed 30 days), if any, provided in the instrument or
agreement under which such Indebtedness was created; (ii) default in the observance or
performance of any other agreement or condition relating to any Indebtedness (other than the
Loans, Reimbursement Obligations and the Guaranty) in a principal amount outstanding of at
least $5,000,000 in the aggregate for the Credit Parties and their Subsidiaries 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 to permit the holder or holders of such Indebtedness or beneficiary or
beneficiaries of such Indebtedness (or a trustee or agent on behalf of such holder or
holders or beneficiary or beneficiaries) to cause, with the giving of notice if required,
such Indebtedness to become due prior to its stated maturity; or (iii) breach or default any
Secured Hedging Agreement (subject to any grace period therein).

     (e) Other Cross-Defaults. The Credit Parties or any of their Subsidiaries
shall default in (i) the payment when due under any Material Contract or (ii) in the
performance or observance, of any obligation or condition of any Material Contract and such
failure to perform or observe such other obligation or condition results in the termination
of such Material Contract.

     (f) Bankruptcy Default. (i) The Credit Parties or any of their Subsidiaries
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 entered with respect to it, or
seeking to have it judged bankrupt or insolvent, or seeking reorganization, arrangement,
adjustment, winding-up, liquidation, dissolution, composition or other relief with respect
to it or its debts (provided that the Borrower may wind up or dissolve Subsidiaries in
accordance with the terms of Section 6.4(a)), 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 the Credit Parties or any of their Subsidiaries shall
make a general assignment for the benefit of its creditors; or (ii) there shall be commenced
against the any Credit Party or any of its Subsidiaries any case, proceeding or other action
of a nature referred to in clause (i) above which (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 sixty (60) days (provided that no Lender shall be required to make
an Extension of Credit during such sixty (60) day period); or (iii) there shall be commenced
against any Credit Party or any of its Subsidiaries 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 which results in the entry of an order for any
such relief which shall not have been vacated, discharged, or stayed or

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bonded pending appeal within sixty (60) days from the entry thereof (provided that no Lender
shall be required to make an Extension of Credit during such 60 day period); or (iv) the
Credit Parties or any of their Subsidiaries 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) the Credit Parties or any of their Subsidiaries
shall generally not, or shall be unable to, or shall admit in writing its inability to, pay
its debts as they become due. Notwithstanding the foregoing, with respect to any Subsidiary
that is not a Significant Subsidiary, none of the events above shall constitute a Default or
an Event of Default unless such event shall not have been cured by the Borrower or
applicable Subsidiary or waived by the Required Lenders within sixty (60) days of such event
occurring.

     (g) Judgment Default. One or more judgments, orders, decrees or arbitration
awards shall be entered against the Credit Parties or any of their Subsidiaries involving in
the aggregate a liability (to the extent not paid when due or covered by insurance) of
$5,000,000 or more and all such judgments, orders, decrees or arbitration awards shall not
have been paid and satisfied, vacated, discharged, stayed or bonded pending appeal within
thirty (30) days from the entry thereof.

     (h) ERISA Default. (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
(other than a Permitted Lien) shall arise on the assets of the Borrower, any of its
Subsidiaries 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) the Borrower, any of its Subsidiaries 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, any Multiemployer
Plan or (vi) any other similar 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 reasonably be expected to have a
Material Adverse Effect.

     (i) Change of Control. A Change of Control shall have occurred.

     (j) Failure of Credit Documents. This Credit Agreement (including the
Guaranty) or any other Credit Document or any provision hereof or thereof shall cease to be
in full force and effect (other than in accordance with its terms) or to give the
Administrative Agent and/or the Lenders the security interests, liens, rights, powers and
privileges purported to be created thereby, or any Credit Party or any Person acting by or
on behalf of any Credit Party shall (i) deny or disaffirm any Credit Party’s obligations

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under this Credit Agreement or any other Credit Document or (ii) assert the invalidity or
lack of perfection or priority of any Lien granted to the Administrative Agent pursuant to
the Security Documents.

     (k) Hedging Agreement. Any termination payment shall be due by a Credit Party
under any Hedging Agreement and such amount is not paid within the later to occur of five
(5) Business Days after the due date thereof or the expiration of grace periods, if any, in
such Hedging Agreement.

     (l) Subordinated Debt. Any default (which is not waived or cured within the
applicable period of grace) or event of default shall occur under any Subordinated Debt
(including, without limitation, the Existing Subordinated Notes) or the subordination
provisions contained therein shall cease to be in full force and effect or to give the
Lenders the rights, powers and privileges purported to be created thereby.

     Section 7.2 Acceleration; Remedies.

     Upon the occurrence and during the continuation of an Event of Default, then, and in any such
event, (a) if such event is a Bankruptcy Event (other than a Subsidiary that is not a Significant
Subsidiary), automatically the Commitments shall immediately terminate and the Loans (with accrued
interest thereon), and all other amounts under the Credit Documents (including without limitation
the maximum amount of all contingent liabilities under Letters of Credit) shall immediately become
due and payable, and the Borrower shall immediately pay to the Administrative Agent cash collateral
as security for the Revolving LOC Obligations and the Credit-Linked LOC Obligations for subsequent
drawings under then outstanding Revolving Letters of Credit and Credit-Linked Letters of Credit in
an amount equal to the maximum amount which may be drawn under such Letters of Credit then
outstanding, and (b) if such event is any other Event of Default, subject to the terms of Section
8.5, with the written consent of the Required Lenders, the Administrative Agent may, or upon the
written request of the Required Lenders, the Administrative Agent shall, take any or all of the
following actions: (i) by notice to the Borrower declare the Commitments to be terminated
forthwith, whereupon the Commitments shall immediately terminate; (ii) by notice of default to the
Borrower declare the Loans (with accrued interest thereon) and all other amounts owing under this
Credit Agreement and the Notes to be due and payable forthwith and direct the Borrower to pay to
the Administrative Agent cash collateral as security for the Revolving LOC Obligations and
Credit-Linked LOC Obligations for subsequent drawings under then outstanding Revolving Letters of
Credit or Credit-Linked Letters of Credit in an amount equal to the maximum amount of which may be
drawn under such Letters of Credit then outstanding, whereupon the same shall immediately become
due and payable; and/or (iii) exercise on behalf of the Lenders all of its other rights and
remedies under this Credit Agreement, the other Credit Documents and applicable law. Except as
expressly provided above in this Section 7.2, presentment, demand, protest and all other notices of
any kind are hereby expressly waived by the Credit Parties

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ARTICLE VIII

THE ADMINISTRATIVE AGENT

     Section 8.1 Appointment and Authority.

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

     Section 8.2 Nature of Duties.

     Anything herein to the contrary notwithstanding, none of the Bookrunners, Arrangers or other
agents listed on the cover page hereof shall have any powers, duties or responsibilities under this
Agreement or any of the other Credit Documents, except in its capacity, as applicable, as the
Administrative Agent, a Lender or the Issuing Lender hereunder. Without limiting the foregoing,
none of the Lenders or other Persons so identified shall have or be deemed to have any fiduciary
relationship with any Lender. Each Lender acknowledges that it has not relied, and will not rely,
on any of the Lenders or other Persons so identified in deciding to enter into this Agreement or in
taking or not taking action hereunder.

     The Administrative Agent may perform any and all of its duties and exercise its rights and
powers hereunder or under any other Credit Document by or through any one or more sub-agents
appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform
any and all of its duties and exercise its rights and powers by or through their respective Related
Parties. The exculpatory provisions of this Article shall apply to any such sub-agent and to the
Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their
respective activities in connection with the syndication of the credit facilities provided for
herein as well as activities as Administrative Agent.

     Section 8.3 Exculpatory Provisions.

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

     (a) shall not be subject to any fiduciary or other implied duties, regardless of
whether a Default has occurred and is continuing;

     (b) shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly contemplated

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hereby or by the other Credit Documents that the Administrative Agent is required to
exercise as directed in writing by the Required Lenders (or such other number or percentage
of the Lenders as shall be expressly provided for herein or in the other Credit Documents),
provided that the Administrative Agent shall not be required to take any action
that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to
liability or that is contrary to any Credit Document or applicable law; and

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

     The Administrative Agent shall not be liable for any action taken or not taken by it (i) with
the consent or at the request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 9.1 and 7.2) or (ii) in the absence of
its own gross negligence or willful misconduct.

     The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire
into (i) any statement, warranty or representation made in or in connection with this Agreement or
any other Credit Document, (ii) the contents of any certificate, report or other document delivered
hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance
of any of the covenants, agreements or other terms or conditions set forth herein or therein or the
occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this
Agreement, any other Credit Document or any other agreement, instrument or document or (v) the
satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm
receipt of items expressly required to be delivered to the Administrative Agent.

     Section 8.4 Reliance by Administrative Agent.

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

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taken or not taken by it in accordance with the advice of any such counsel, accountants or
experts.

     Section 8.5 Notice of Default.

     The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of
any Default or Event of Default hereunder unless the Administrative Agent has received written
notice from a Lender or the 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 prompt 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;
provided, however, 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 except to the extent that this Agreement
expressly requires that such action be taken, or not taken, only with the consent or upon the
authorization of the Required Lenders, or all of the Lenders, as the case may be.

     Section 8.6 Non-Reliance on Administrative Agent and Other Lenders.

     Each Lender and the Issuing Lender expressly acknowledges that neither the Administrative
Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or affiliates has
made any representation or warranty to it and that no act by the Administrative Agent hereinafter
taken, including any review of the affairs of any Credit Party, shall be deemed to constitute any
representation or warranty by the Administrative Agent to any Lender. Each Lender and the Issuing
Lender acknowledges that it has, independently and without reliance upon the Administrative Agent
or any other Lender or any of their Related Parties and based on such documents and information as
it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement.
Each Lender and the Issuing Lender also acknowledges that it will, independently and without
reliance upon the Administrative Agent or any other Lender or any of their Related Parties and
based on such documents and information as it shall from time to time deem appropriate, continue to
make its own decisions in taking or not taking action under or based upon this Agreement, any other
Credit Document or any related agreement or any document furnished hereunder or thereunder.

     Section 8.7 Indemnification.

     The Lenders agree to indemnify the Administrative Agent, the Issuing Lender, and the Swingline
Lender in its capacity hereunder and their Affiliates and their respective officers, directors,
agents and employees (to the extent not reimbursed by the Borrower and without limiting the
obligation of the Borrower to do so), ratably according to their respective Commitment Percentages
in effect on the date on which indemnification is sought under this Section, from and against any
and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever which may at any time (including, without
limitation, at any time following the payment of the Credit Party

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Obligations) be imposed on, incurred by or asserted against any such indemnitee in any way relating
to or arising out of any Credit Document 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 any
such indemnitee under or in connection with any of the foregoing; provided,
however, 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 to the extent resulting from such indemnitee’s gross negligence or willful
misconduct, as determined by a court of competent jurisdiction. The agreements in this Section
shall survive the termination of this Agreement and payment of the Notes, any Reimbursement
Obligation and all other amounts payable hereunder.

     Section 8.8 Administrative Agent in Its Individual Capacity.

     The Person serving as the Administrative Agent hereunder shall have the same rights and powers
in its capacity as a Lender as any other Lender and may exercise the same as though it were not the
Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated
or unless the context otherwise requires, include the Person serving as the Administrative Agent
hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from,
lend money to, act as the financial advisor or in any other advisory capacity for and generally
engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if
such Person were not the Administrative Agent hereunder and without any duty to account therefor to
the Lenders.

     Section 8.9 Successor Administrative Agent.

     The Administrative Agent may at any time give notice of its resignation to the Lenders, the
Issuing Lender and the Borrower. Upon receipt of any such notice of resignation, the Required
Lenders shall have the right, in consultation with the Borrower, to appoint a successor, or an
Affiliate of any such bank. If no such successor shall have been so appointed by the Required
Lenders and shall have accepted such appointment within thirty (30) days after the retiring
Administrative Agent gives notice of its resignation, then the retiring Administrative Agent may on
behalf of the Lenders and the Issuing Lender, appoint a successor Administrative Agent meeting the
qualifications set forth above provided that if the Administrative Agent shall notify the Borrower
and the Lenders that no qualifying Person has accepted such appointment, then such resignation
shall nonetheless become effective in accordance with such notice and (a) the retiring
Administrative Agent shall be discharged from its duties and obligations hereunder and under the
other Credit Documents (except that in the case of any Collateral held by the Administrative Agent
on behalf of the Lenders or the Issuing Lender under any of the Credit Documents, the retiring
Administrative Agent shall continue to hold such Collateral until such time as a successor
Administrative Agent is appointed) and (2) all payments, communications and determinations provided
to be made by, to or through the Administrative Agent shall instead be made by or to each Lender
and the Issuing Lender directly, until such time as the Required Lenders appoint a successor
Administrative Agent as provided for above in this paragraph. Upon the acceptance of a successor’s
appointment as Administrative Agent hereunder, such successor shall succeed to and become vested
with all of the rights, powers, privileges and duties of the retiring (or retired) Administrative
Agent, and the retiring Administrative Agent shall be

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discharged from all of its duties and obligations hereunder or under the other Credit
Documents (if not already discharged therefrom as provided above in this paragraph). The fees
payable by the Borrower to a successor Administrative Agent shall be the same as those payable to
its predecessor unless otherwise agreed between the Borrower and such successor. After the
retiring Administrative Agent’s resignation hereunder and under the other Credit Documents, the
provisions of this Article and Section 9.5 shall continue in effect for the benefit of such
retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of
any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was
acting as Administrative Agent.

     Section 8.10 Collateral and Guaranty Matters.

     (a) The Lenders irrevocably authorize and direct the Administrative Agent:

     (i) to release any Lien on any Collateral granted to or held by the Administrative
Agent under any Credit Document (i) upon termination of the Revolving Commitments and
payment in full of all Credit Party Obligations (other than contingent indemnification
obligations) and the expiration or termination of all Letters of Credit, (ii) that is
transferred or to be transferred as part of or in connection with any sale or other
disposition permitted under Section 6.4 or otherwise pursuant to this Credit Agreement, or
(iii) subject to Section 9.1, if approved, authorized or ratified in writing by the Required
Lenders;

     (ii) to subordinate any Lien on any Collateral granted to or held by the Administrative
Agent under any Credit Document to the holder of any Lien on such Collateral that is
permitted by Section 6.2; and

     (iii) to release any Guarantor from its obligations under the applicable Guaranty if
such Person ceases to be a Guarantor as a result of a transaction permitted hereunder,
including, without limitation, the release of any Permitted Real Estate Entity as a
Guarantor in accordance with the terms of Section 5.10.

     (b) In connection with a termination or release pursuant to this Section, the Administrative
Agent shall promptly execute and deliver to the applicable Credit Party, at the Borrower’s expense,
all documents that the applicable Credit Party shall reasonably request to evidence such
termination or release. Upon request by the Administrative Agent at any time, the Required Lenders
will confirm in writing the Administrative Agent’s authority to release or subordinate its interest
in particular types or items of Collateral, or to release any Guarantor from its obligations under
the Guaranty pursuant to this Section.

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ARTICLE IX

MISCELLANEOUS

     Section 9.1 Amendments, Waivers and Release of Collateral.

     Neither this Credit Agreement, nor any of the Notes, nor any of the other Credit Documents,
nor any terms hereof or thereof may be amended, supplemented, waived or modified except in
accordance with the provisions of this Section nor may the Borrower or any Guarantor be released
except in accordance with the provisions of this Section 9.1. The Required Lenders may, or, with
the written consent of the Required Lenders, the Administrative Agent may, from time to time, (a)
enter into with the Borrower or any other Credit Party written amendments, supplements or
modifications hereto and to the other Credit Documents for the purpose of adding any provisions to
this Credit Agreement or the other Credit Documents or changing in any manner the rights of the
Lenders or of the Borrower or any other Credit Party hereunder or thereunder (it being understood
that the Guarantor’s consent shall not be required for any amendment to any Credit Document other
than amendments to Article X of this Credit Agreement) or (b) waive, on such terms and conditions
as the Required Lenders may specify in such instrument, any of the requirements of this Credit
Agreement or the other Credit Documents or any Default or Event of Default and its consequences;
provided, however, that no such waiver and no such amendment, waiver, supplement,
modification or release shall:

     (i) reduce the amount or extend the scheduled date of maturity of any Loan or
Note or any installment thereon, or reduce the stated rate of any interest or fee
payable hereunder (except in connection with a waiver of interest at the increased
post-default rate set forth in Section 2.11(a) which shall be determined by a vote
of the Required Lenders) or extend the scheduled date of any payment thereof or
increase the amount or extend the expiration date of any Lender’s Commitment, in
each case without the written consent of each Lender directly affected thereby;
provided that, it is understood and agreed that no waiver, reduction or
deferral of a mandatory prepayment required pursuant to Section 2.9(b), nor any
amendment of Section 2.9(b) or the definitions of Asset Disposition, Debt Issuance,
Equity Issuance, Permitted Real Estate Sale, Permitted Real Estate Transfer,
Permitted Real Estate Entity Distribution, Excess Cash Flow, or Recovery Event,
shall constitute a reduction of the amount of, or an extension of the scheduled date
of, any principal installment of any Loan or Note; or

     (ii) amend, modify or waive any provision of this Section 9.1 or reduce the
percentage specified in the definition of Required Lenders, without the written
consent of all the Lenders; or

     (iii) amend, modify or waive any provision of Article VIII without the written
consent of the then Administrative Agent; or

     (iv) release the Borrower or all or substantially all of the Guarantors from
their respective obligations hereunder or under the Guaranty, without the written
consent of all of the Lenders and any Hedging Agreement Provider; or

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     (v) release all or substantially all of the Collateral without the written
consent of all of the Secured Parties; or

     (vi) subordinate the Loans to any other Indebtedness without the written
consent of all of the Lenders; or

     (vii) permit a Letter of Credit to have an original expiry date more than
twelve (12) months from the date of issuance without the consent of each of the
Revolving Lenders or Credit-Linked Lenders, as applicable; provided, that
the expiry date of any Letter of Credit may be extended in accordance with the terms
of Section 2.2(a) or Section 2.5(a), as applicable; or

     (viii) permit the Borrower to assign or transfer any of its rights or
obligations under this Credit Agreement or other Credit Documents; or

     (ix) amend, modify or waive any provision of the Credit Documents requiring
consent, approval or request of the Required Lenders or all Lenders without the
written consent of the Required Lenders or all the Lenders as appropriate; or

     (x) amend, modify or waive the order in which Credit Party Obligations are paid
in Section 2.9(b)(x) or the pro rata treatment of payments in Section 2.13(a),
without the written consent of each Lender directly affected thereby;
provided that, notwithstanding the foregoing, such order or treatment may be
modified without the consent of each Lender directly affected thereby (but with the
consent of the Required Lenders) to permit additional extensions of credit
constituting (A) term loans to share ratably with the Term Loan in the application
of repayment or prepayments pursuant to Section 2.9 or Section 2.13 with the consent
of the Required Lenders, or (B) revolving loans to share ratably with the Revolving
Loans in the application of repayments or prepayments pursuant to Section 2.9 or
Section 2.13 with the consent of the Required Lenders; or

     (xi) amend, modify or waive the order in which Credit Party Obligations are
paid in Section 2.13(b) or the definition of “Credit Party Obligations” to delete or
otherwise modify the treatment of any obligations referenced in such definition
without the written consent of each Secured Party directly affected thereby;
provided that, notwithstanding the foregoing, such order may be modified
without the consent of each Secured Party directly affected thereby to permit
additional extensions of credit approved by the Required Lenders to share ratably
with the Credit Party Obligations; or

     (xii) amend, modify or waive the definition of “Secured Hedging Agreement”,
“Hedging Agreement Provider” or “Secured Party” without the consent of each Hedging
Agreement Provider; or

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     (xiii) without the written consent of the Revolving Lenders holding in the
aggregate more than 50% of the Revolving Commitments (or if the Revolving
Commitments have been terminated, 50% of the outstanding Revolving Loans and
Revolving Participation Interests), amend, modify or waive any provision specific to
the revolving credit facility, swingline subfacility and revolving letter of credit
subfacility provided under Sections 2.1, 2.2 and 2.3; or

     (xiv) without the written consent of the Credit-Linked Lenders holding in the
aggregate more than 50% of the Credit-Linked Commitments (or if the Credit-Linked
Commitments have been terminated, 50% of the outstanding Term Loans and
Credit-Linked Participation Interests), amend, modify or waive any provision
specific to the credit-linked facilities provided under Sections 2.4 and 2.5.

     provided, further, that no amendment, waiver or consent affecting the rights
or duties of the Administrative Agent, any Issuing Lender or the Swingline Lender under any Credit
Document shall in any event be effective, unless in writing and signed by the Administrative Agent,
such Issuing Lender and/or the Swingline Lender, as applicable, in addition to the Lenders required
hereinabove to take such action.

     Any such waiver, any such amendment, supplement or modification and any such release shall
apply equally to each of the Lenders and shall be binding upon the Borrower, the other Credit
Parties, the Lenders, the Administrative Agent and all future holders of the Notes. In the case of
any waiver, the Borrower, the other Credit Parties, the Lenders and the Administrative Agent shall
be restored to their former position and rights hereunder and under the outstanding Loans and Notes
and other Credit 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.

     Notwithstanding any of the foregoing to the contrary, the consent of the Credit Parties shall
not be required for any amendment, modification or waiver of the provisions of Article VIII (other
than the provisions of Section 8.9); provided, however, that the Administrative Agent will provide
written notice to the Borrower of any such amendment, modification or waiver.

     Notwithstanding the fact that the consent of all the Lenders is required in certain
circumstances as set forth above, (x) each Lender is entitled to vote as such Lender sees fit on
any bankruptcy reorganization plan that affects the Loans, and each Lender acknowledges that the
provisions of Section 1126(c) of the Bankruptcy Code supersedes the unanimous consent provisions
set forth herein and (y) the Required Lenders may consent to allow a Credit Party to use cash
collateral in the context of a bankruptcy or insolvency proceeding.

     Section 9.2 Notices.

     Except as otherwise provided in Article II, all notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by telecopy), and, unless
otherwise expressly provided herein, shall be deemed to have been duly given or made (a) when
delivered by hand, (b) when transmitted via telecopy (or other facsimile device) to the

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number set out herein or (c) the day following the day on which the same has been delivered prepaid
to a reputable national overnight air courier service, in each case, addressed as follows in the
case of the Borrower, the other Credit Parties and the Administrative Agent, and as set forth on
Schedule 9.2 in the case of the Lenders, or to such other address as may be hereafter
notified by the respective parties hereto and any future holders of the Notes:

	 	 	 
	The Borrower
and the other
Credit Parties:

	 	GenCorp Inc.
	 

	 	P.O. Box 537012
	 

	 	Sacramento, CA 95813-7012
	 

	 	Attention: Chief Financial Officer
	 

	 	Telephone: (916) 351-8585
	 

	 	Telecopier: (916) 351-8668
	 
	 	 
	With a copy to:

	 	S. Kay McNab
	 

	 	Winston & Strawn LLP
	 

	 	35 W. Wacker Drive
	 

	 	Chicago, Illinois 60601-9703
	 

	 	Telephone: (312) 558-5959
	 

	 	Telecopier: (312) 558-5700
	 
	 	 
	The Administrative 

Agent:

	 	Wachovia Bank, National Association, as Administrative Agent
	 

	 	Charlotte Plaza
	 

	 	201 South College Street, CP8
	 

	 	Charlotte, North Carolina 28288-0680
	 

	 	Attention: Syndication Agency Services
	 

	 	Telecopier: (704) 388-2833
	 

	 	Telephone: (704) 715-2210
	 
	 	 
	with a copy to:

	 	Wachovia Bank, National Association
	 

	 	One South Broad
	 

	 	Mailcode PA4843
	 

	 	Philadelphia, Pennsylvania 19107
	 

	 	Attention: William F. Fox
	 

	 	Telecopier: (267) 321-6700
	 

	 	Telephone: (267) 321-6612

provided, that notices given by the Borrower pursuant to Section 2.1 or Section 2.12 hereof
shall be effective only upon receipt thereof by the Administrative Agent.

     Notices to a Lender shall be delivered to it at its address (or telecopier number) set forth
in its Administrative Questionnaire.

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     Section 9.3 No Waiver; Cumulative Remedies.

     No failure to exercise and no delay in exercising, on the part of the Administrative Agent or
any Lender, any right, remedy, power or privilege hereunder 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.

     Section 9.4 Survival of Representations and Warranties.

     All representations and warranties made hereunder and in any document, certificate or
statement delivered pursuant hereto or in connection herewith shall survive the execution and
delivery of this Credit Agreement and the Notes and the making of the Loans; provided that
all such representations and warranties shall terminate on the date upon which the Commitments have
been terminated and all amounts owing hereunder and under any Notes have been paid in full.

     Section 9.5 Payment of Expenses and Taxes; Indemnity.

     (a) Costs and Expenses. The Borrower shall pay (i) all reasonable
out-of-pocket expenses incurred by the Administrative Agent and its Affiliates (including
the reasonable fees, charges and disbursements of counsel for the Administrative Agent), and
shall pay all reasonable fees and time charges and disbursements for attorneys who may be
employees of the Administrative Agent, in connection with the syndication of the credit
facilities provided for herein, the preparation, negotiation, execution, delivery and
administration of this Agreement and the other Credit Documents or any amendments,
modifications or waivers of the provisions hereof or thereof (whether or not the
transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable
out-of-pocket expenses incurred by any Issuing Lender and the Swingline Lender in connection
with the issuance, amendment, renewal or extension of any Letter of Credit or Swingline Loan
or any demand for payment thereunder and (iii) all out-of-pocket expenses incurred by the
Administrative Agent, any Lender, any Issuing Lender or the Swingline Lender (including the
reasonable fees, charges and disbursements of any counsel for the Administrative Agent, any
Lender or any Issuing Lender), and shall pay all fees and time charges for attorneys who may
be employees of the Administrative Agent, any Lender, any Issuing Lender or the Swingline
Lender, in connection with the enforcement or protection of its rights (A) in connection
with this Agreement and the other Credit Documents, including its rights under this Section,
or (B) in connection with the Loans made or Letters of Credit issued hereunder, including
all such reasonable out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit.

     (b) Indemnification by the Borrower. The Borrower shall indemnify the
Administrative Agent (and any sub-agent thereof), each Lender, the Issuing Lender and the
Swingline Lender, and each Related Party of any of the foregoing Persons (each such

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Person being called an “Indemnitee”) against, and hold each Indemnitee harmless
from, any and all losses, claims, damages, liabilities and related expenses (including the
fees, charges and disbursements of any counsel for any Indemnitee), and shall indemnify and
hold harmless each Indemnitee from all fees and time charges and disbursements for attorneys
who may be employees of any Indemnitee, incurred by any Indemnitee or asserted against any
Indemnitee by any third party or by the Borrower or any other Credit Party arising out of,
in connection with, or as a result of (i) the execution or delivery of this Agreement, any
other Credit Document or any agreement or instrument contemplated hereby or thereby, the
performance by the parties hereto of their respective obligations hereunder or thereunder or
the consummation of the transactions contemplated hereby or thereby, (ii) any Loan or Letter
of Credit or the use or proposed use of the proceeds therefrom (including any refusal by an
Issuing Lender to honor a demand for payment under a Letter of Credit if the documents
presented in connection with such demand do not strictly comply with the terms of such
Letter of Credit), (iii) any actual or alleged presence or release of Materials of
Environmental Concern on or from any property owned or operated by the Borrower or any of
its Subsidiaries, or any liability under Environmental Law related in any way to the
Borrower or any of its Subsidiaries, or (iv) any claim, litigation, investigation or
proceeding relating to any of the foregoing, whether based on contract, tort or any other
theory, whether brought by a third party or by the Borrower or any other Credit Party, and
regardless of whether any Indemnitee is a party thereto, provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such losses,
claims, damages, liabilities or related expenses (A) are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the gross negligence
or willful misconduct of such Indemnitee or (B) result from a claim brought by the Borrower
or any other Credit Party against an Indemnitee for breach in bad faith of such Indemnitee’s
obligations hereunder or under any other Credit Document, if the Borrower or such Credit
Party has obtained a final and nonappealable judgment in its favor on such claim as
determined by a court of competent jurisdiction.

     (c) Reimbursement by Lenders. To the extent that the Borrower for any reason
fails to indefeasibly pay any amount required under paragraph (a) or (b) of this Section to
be paid by it to the Administrative Agent (or any sub-agent thereof), any Issuing Lender,
Swingline Lender or any Related Party of any of the foregoing, each Lender severally agrees
to pay to the Administrative Agent (or any such sub-agent), any Issuing Lender, Swingline
Lender or such Related Party, as the case may be, such Lender’s Commitment Percentage
(determined as of the time that the applicable unreimbursed expense or indemnity payment is
sought) of such unpaid amount, provided that the unreimbursed expense or indemnified
loss, claim, damage, liability or related expense, as the case may be, was incurred by or
asserted against the Administrative Agent (or any such sub-agent), any Issuing Lender or
Swingline Lender in its capacity as such, or against any Related Party of any of the
foregoing acting for the Administrative Agent (or any such sub-agent), any Issuing Lender or
Swingline Lender in connection with such capacity.

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     (d) Waiver of Consequential Damages, Etc. To the fullest extent permitted by
applicable law, the Borrower shall not assert, and hereby waives, any claim against any
Indemnitee, on any theory of liability, for special, indirect, consequential or punitive
damages (as opposed to direct or actual damages) arising out of, in connection with, or as a
result of, this Agreement, any other Credit Document or any agreement or instrument
contemplated hereby, the transactions contemplated hereby or thereby, any Loan or Letter of
Credit or the use of the proceeds thereof. No Indemnitee referred to in paragraph (b) above
shall be liable for any damages arising from the use by unintended recipients of any
information or other materials distributed by it through telecommunications, electronic or
other information transmission systems in connection with this Agreement or the other Credit
Documents or the transactions contemplated hereby or thereby.

     (e) Payments. All amounts due under this Section shall be payable promptly/not
later than five (5) days after demand therefor.

     Section 9.6 Successors and Assigns; Participations; Purchasing Lenders.

     (a) Successors and Assigns Generally. The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns permitted hereby, except that neither the Borrower nor any other
Credit Party may assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of the Administrative Agent and each Lender and no Lender
may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an
assignee in accordance with the provisions of paragraph (b) of this Section, (ii) by way of
participation in accordance with the provisions of paragraph (d) of this Section or (iii) by
way of pledge or assignment of a security interest subject to the restrictions of paragraph
(f) of this Section (and any other attempted assignment or transfer by any party hereto
shall be null and void). Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby, Participants to the extent provided in paragraph
(d) of this Section and, to the extent expressly contemplated hereby, the Related Parties of
each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or
claim under or by reason of this Agreement.

     (b) Assignments by Lenders. Any Lender may at any time assign to one or more
assignees all or a portion of its rights and obligations under this Agreement (including all
or a portion of its Commitment and the Loans at the time owing to it); provided that
any such assignment shall be subject to the following conditions:

     (i) Minimum Amounts.

     (A) in the case of an assignment of the entire remaining amount of the
assigning Lender’s Commitment and the Loans at the time owing to it or in
the case of an assignment to a Lender, an Affiliate of a Lender or an
Approved Fund, no minimum amount need be assigned; and

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     (B) in any case not described in paragraph (b)(i)(A) of this Section,
the aggregate amount of the Commitment (which for this purpose includes
Loans outstanding thereunder) or, if the applicable Commitment is not then
in effect, the principal outstanding balance of the 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 or, if “Trade Date” is specified in the Assignment
and Assumption, as of the Trade Date) shall not be less than $3,000,000, in
the case of any assignment in respect of a revolving facility, or
$1,000,000, in the case of any assignment in respect of a term facility,
unless each of the Administrative Agent and, so long as no Event of Default
has occurred and is continuing, the Borrower otherwise consents (each such
consent not to be unreasonably withheld or delayed).

     (ii) Proportionate Amounts.

     (A) Each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender’s rights and obligations
under this Agreement with respect to the Loan or the Commitment assigned,
except that this clause (ii) shall not prohibit any Lender from assigning
all or a portion of its rights and obligations among separate Tranches on a
non-pro rata basis.

     (B) With respect to an assignment by a Credit-Linked Lender, such
assignment shall be made on a pro rata basis among such Credit-Linked
Lender’s Credit-Linked LOC Commitment and outstanding Term Loan.

     (iii) Required Consents. No consent shall be required for any
assignment except to the extent required by paragraph (b)(i)(B) of this Section and,
in addition:

     (A) the consent of the Borrower (such consent not to be unreasonably
withheld or delayed) shall be required unless (x) an Event of Default has
occurred and is continuing at the time of such assignment or (y) such
assignment is to a Lender, an Affiliate of a Lender or an Approved Fund; and

     (B) the consent of the Administrative Agent (such consent not to be
unreasonably withheld or delayed) shall be required for assignments in
respect of (i) a Revolving Commitment if such assignment is to a Person that
is not a Lender with a Commitment in respect of such facility, an Affiliate
of such Lender or an Approved Fund with respect to such Lender or (ii) a
Term Loan Commitment to a Person who is not a Lender, an Affiliate of a
Lender or an Approved Fund.

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     (iv) Assignment and Assumption. The parties to each assignment shall
execute and deliver to the Administrative Agent an Assignment and Assumption,
together with a processing and recordation fee of $3,500, and the assignee, if it is
not a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.

     (v) No Assignment to Borrower. No such assignment shall be made to the
Borrower or any of the Borrower’s Affiliates or Subsidiaries.

     (vi) No Assignment to Natural Persons. No such assignment shall be
made to a natural person.

     Subject to acceptance and recording thereof by the Administrative Agent pursuant to
paragraph (c) of this Section, from and after the effective date specified in each
Assignment and Assumption, the assignee thereunder shall be a party to this Agreement and,
to the extent of the interest assigned by such Assignment and Assumption, have the rights
and obligations of 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 2.17 and 9.5 with respect to facts and circumstances occurring prior to the
effective date of such assignment. Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this paragraph shall be treated
for purposes of this Agreement as a sale by such Lender of a participation in such rights
and obligations in accordance with paragraph (d) of this Section.

     (c) Register. The Administrative Agent, acting solely for this purpose as an
agent of the Borrower, shall maintain at one of its offices in Charlotte, North Carolina 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 amounts of the
Loans 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 Borrower, the
Administrative Agent 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 Borrower and any Lender, at any reasonable time and from time to time upon
reasonable prior notice.

     (d) Participations. Any Lender may at any time, without the consent of, or
notice to, the Borrower or the Administrative Agent, sell participations to any Person
(other than a natural person or the Borrower or any of the Borrower’s Affiliates or
Subsidiaries) (each, a “Participant”) in all or a portion of such Lender’s rights
and/or obligations under this Agreement (including all or a portion of its Commitment and/or
the

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Loans owing to it); provided that (i) such Lender’s obligations under this
Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations and (iii) the Borrower, the
Administrative Agent and the Lenders, Issuing Lender and Swingline Lender shall continue to
deal solely and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.

     Any agreement or instrument pursuant to which a Lender sells such a participation shall
provide that such Lender shall retain the sole right to enforce this Agreement and to
approve any amendment, modification or waiver of any provision of this Agreement;
provided that such agreement or instrument may provide that such Lender will not,
without the consent of the Participant, agree to any amendment, modification or waiver that
affects such Participant. Subject to paragraph (e) of this Section, the Borrower agrees
that each Participant shall be entitled to the benefits of Sections 2.17 and 2.18 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 9.7 as though it were a Lender, provided such
Participant agrees to be subject to Section 2.13 as though it were a Lender.

     (e) Limitations upon Participant Rights. A Participant shall not be entitled
to receive any greater payment under Sections 2.17 and 2.19 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 Borrower’s prior
written consent. A Participant that would be a Foreign Lender if it were a Lender shall not
be entitled to the benefits of Section 2.19 unless the Borrower is notified of the
participation sold to such Participant and such Participant agrees, for the benefit of the
Borrower, to comply with Section 2.19 as though it were a Lender.

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

     (g) The Credit-Linked Deposit funded by any Credit-Linked Lender pursuant to Section
2.6 shall not be released in connection with any assignment of its Credit-Linked Commitment
but shall instead be purchased by the relevant assignee and continue to be held for
application in accordance with the terms of Section 2.6 in respect of the Credit-Linked
Commitment assigned to such assignee.

     Section 9.7 Right of Set-off; Sharing of Payments.

     (a) If an Event of Default shall have occurred and be continuing, each Lender, each
Issuing Lender, and each of their respective Affiliates is hereby authorized at any

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time and from time to time, to the fullest extent permitted by applicable law, to set
off and apply any and all deposits (general or special, time or demand, provisional or
final, in whatever currency) at any time held and other obligations (in whatever currency)
at any time owing by such Lender, such Issuing Lender or any such Affiliate to or for the
credit or the account of the Borrower or any other Credit Party against any and all of the
obligations of the Borrower or such Credit Party now or hereafter existing under this
Agreement or any other Credit Document to such Lender or such Issuing Lender, irrespective
of whether or not such Lender or such Issuing Lender shall have made any demand under this
Agreement or any other Credit Document and although such obligations of the Borrower or such
Credit Party may be contingent or unmatured or are owed to a branch or office of such Lender
or such Issuing Lender different from the branch or office holding such deposit or obligated
on such indebtedness. The rights of each Lender, each Issuing Lender and their respective
Affiliates under this Section are in addition to other rights and remedies (including other
rights of setoff) that such Lender, such Issuing Lender or their respective Affiliates may
have. Each Lender and each Issuing Lender agrees to notify the Borrower and the
Administrative Agent promptly after any such setoff and application, provided that
the failure to give such notice shall not affect the validity of such setoff and
application.

     (b) If any Lender shall, by exercising any right of setoff or counterclaim or
otherwise, obtain payment in respect of any principal of or interest on any of its Loans or
other obligations hereunder resulting in such Lender’s receiving payment of a proportion of
the aggregate amount of its Loans and accrued interest thereon or other such obligations
greater than its pro rata share thereof as provided herein, then the Lender
receiving such greater proportion shall (i) notify the Administrative Agent of such fact,
and (ii) purchase (for cash at face value) participations in the Loans and such other
obligations of the other Lenders, or make such other adjustments as shall be equitable, so
that the benefit of all such payments shall be shared by the Lenders ratably in accordance
with the aggregate amount of principal of and accrued interest on their respective Loans and
other amounts owing them, provided that:

     (i) if any such participations are purchased and all or any portion of the
payment giving rise thereto is recovered, such participations shall be rescinded and
the purchase price restored to the extent of such recovery, without interest; and

     (ii) the provisions of this paragraph shall not be construed to apply to (A)
any payment made by the Borrower pursuant to and in accordance with the express
terms of this Agreement or (B) any payment obtained by a Lender as consideration for
the assignment of or sale of a participation in any of its Loans or participations
in Letters of Credit to any assignee or participant, other than to the Borrower or
any Subsidiary thereof (as to which the provisions of this paragraph shall apply).

     (c) Each Credit Party consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a participation

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pursuant to the foregoing arrangements may exercise against each Credit Party rights of
setoff and counterclaim with respect to such participation as fully as if such Lender were a
direct creditor of each Credit Party in the amount of such participation.

     Section 9.8 Table of Contents and Section Headings.

     The table of contents and the Section and subsection headings herein are intended for
convenience only and shall be ignored in construing this Credit Agreement.

     Section 9.9 Counterparts.

     (a) Counterparts; Integration; Effectiveness. This Agreement may be executed
in counterparts (and by different parties hereto in different counterparts), each of which
shall constitute an original, but all of which when taken together shall constitute a single
contract. This Agreement and the other Credit Documents, and any separate letter agreements
with respect to fees payable to the Administrative Agent, constitute the entire contract
among the parties relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter hereof.
Subject to the provisions set forth in Section 4.1, this Agreement shall become effective
when it shall have been executed by the Administrative Agent and when the Administrative
Agent shall have received counterparts hereof that, when taken together, bear the signatures
of each of the other parties hereto. Delivery of an executed counterpart of a signature
page of this Agreement by telecopy or email shall be effective as delivery of a manually
executed counterpart of this Agreement.

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

     Section 9.10 Integration; Effectiveness; Continuing Agreement.

     (a) This Credit Agreement, together with the other Credit Documents, comprises the
complete and integrated agreement of the parties on the subject matter hereof and thereof
and supersedes all prior agreements, written or oral, on such subject matter. In the event
of any conflict between the provisions of this Credit Agreement and those of any other
Credit Document, the provisions of this Credit Agreement shall control; provided
that the inclusion of supplemental rights or remedies in favor of the Administrative Agent
or the Lenders in any other Credit Document shall not be deemed a conflict with this Credit
Agreement. Each Credit Document was drafted with the joint

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participation of the respective parties thereto and shall be construed neither against
nor in favor of any party, but rather in accordance with the fair meaning thereof.

     (b) This Credit Agreement shall become effective at such time when all of the
conditions set forth in Section 4.1 have been satisfied or waived by the Lenders and it
shall have been executed by the Borrower, the Guarantors and the Administrative Agent, and
the Administrative Agent shall have received copies hereof (telefaxed or otherwise) which,
when taken together, bear the signatures of each Lender, and thereafter this Credit
Agreement shall be binding upon and inure to the benefit of the Borrower, the Guarantors,
the Administrative Agent and each Lender and their respective successors and permitted
assigns.

     (c) This Credit Agreement shall be a continuing agreement and shall remain in full
force and effect until all Loans, Revolving LOC Obligations, Credit-Linked LOC Obligations,
interest, fees and other Credit Party Obligations (other than those obligations that
expressly survive the termination of this Credit Agreement) have been paid in full and all
Commitments and Letters of Credit have been terminated. Upon termination, the Credit
Parties shall have no further obligations (other than those obligations that expressly
survive the termination of this Credit Agreement) under the Credit Documents and the
Administrative Agent shall, at the request and expense of the Borrower, deliver all the
Collateral in its possession to the Borrower and release all Liens on the Collateral;
provided that should any payment, in whole or in part, of the Credit Party
Obligations be rescinded or otherwise required to be restored or returned by the
Administrative Agent or any Lender, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, then the Credit Documents shall automatically be reinstated and
all Liens of the Administrative Agent shall reattach to the Collateral and all amounts
required to be restored or returned and all costs and expenses incurred by the
Administrative Agent or any Lender in connection therewith shall be deemed included as part
of the Credit Party Obligations.

     Section 9.11 Severability.

     Any provision of this Credit Agreement which 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.

     Section 9.12 Governing Law.

     This Credit Agreement and the Notes and the rights and obligations of the parties under this
Credit Agreement and the Notes shall be governed by, and construed and interpreted in accordance
with, the law of the State of New York.

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     Section 9.13 Consent to Jurisdiction and Service of Process.

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

     (b) Service of Process. Each party hereto irrevocably consents to service of
process in the manner provided for notices in Section 9.2. Nothing in this Agreement will
affect the right of any party hereto to serve process in any other manner permitted by
applicable law.

     (c) Venue. The Borrower and each other Credit Party irrevocably and
unconditionally waives, to the fullest extent permitted by applicable law, any objection
that it may now or hereafter have to the laying of venue of any action or proceeding arising
out of or relating to this Agreement or any other Credit Document in any court referred to
in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to
the fullest extent permitted by applicable law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.

     Section 9.14 Confidentiality.

     Each of the Administrative Agent, the Lenders and the Issuing Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information may be disclosed (a)
to its Affiliates and to its and its Affiliates’ respective partners, directors, officers,
trustees, employees, agents, advisors and other representatives (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the extent requested by
any regulatory authority purporting to have jurisdiction over it (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to the extent required
by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other
party hereto, (e) in connection with the exercise of any remedies hereunder, under any other Credit
Document or Secured Hedging Agreement or any action or proceeding relating to this Agreement, any
other Credit Document or Secured Hedging Agreement or the enforcement of rights hereunder or
thereunder, (f) subject to an agreement containing provisions substantially

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the same as those of this Section, to any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this Agreement, (g) (i) any
actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating
to the Borrower and its obligations, (ii) an investor or prospective investor in securities issued
by an Approved Fund that also agrees that Information shall be used solely for the purpose of
evaluating an investment in such securities issued by the Approved Fund, (iii) a trustee,
collateral manager, servicer, backup servicer, noteholder or secured party in connection with the
administration, servicing and reporting on the assets serving as collateral for securities issued
by an Approved Fund, or (iv) a nationally recognized rating agency that requires access to
information regarding the Credit Parties, the Loans and Credit Documents in connection with ratings
issued in respect of securities issued by an Approved Fund (in each case, it being understood that
the Persons to whom such disclosure is made will be informed of the confidential nature of such
information and instructed to keep such information confidential), (h) with the consent of the
Borrower or (i) to the extent such Information (x) becomes publicly available other than as a
result of a breach of this Section or (y) becomes available to the Administrative Agent, any
Lender, any Issuing Lender or any of their respective Affiliates on a nonconfidential basis from a
source other than the Borrower.

For purposes of this Section, “Information” means all information received from the
Borrower or any of its Subsidiaries relating to the Borrower or any of its Subsidiaries or any of
their respective businesses, other than any such information that is available to the
Administrative Agent, any Lender or any Issuing Lender on a nonconfidential basis prior to
disclosure by the Borrower or any of its Subsidiaries, provided that, in the case of
information received from the Borrower or any of its Subsidiaries after the date hereof, such
information is clearly identified at the time of delivery as confidential. Any Person required to
maintain the confidentiality of Information as provided in this Section shall be considered to have
complied with its obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to its own
confidential information.

     Section 9.15 Acknowledgments.

     The Borrower and the other Credit Parties each hereby acknowledges that:

     (a) it has been advised by counsel in the negotiation, execution and delivery of each
Credit Document;

     (b) neither the Administrative Agent nor any Lender has any fiduciary relationship with
or duty to the Borrower or any other Credit Party arising out of or in connection with this
Credit Agreement and the relationship between Administrative Agent and Lenders, on one hand,
and the Borrower and the other Credit Parties, on the other hand, in connection herewith is
solely that of debtor and creditor; and

     (c) no joint venture exists among the Lenders or among the Borrower or the other Credit
Parties and the Lenders.

136

 

     Section 9.16 Waivers of Jury Trial; Waiver of Consequential Damages.

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

     Section 9.17 Patriot Act Notice.

     Each Lender and the Administrative Agent (for itself and not on behalf of any other party)
hereby notifies the Borrower that, pursuant to the requirements of the Patriot Act, it is required
to obtain, verify and record information that identifies the Borrower and the other Credit Parties,
which information includes the name and address of the Borrower and the other Credit Parties and
other information that will allow such Lender or the Administrative Agent, as applicable, to
identify the Borrower and the other Credit Parties in accordance with the Patriot Act.

ARTICLE X

GUARANTY

     Section 10.1 The Guaranty.

     In order to induce the Lenders to enter into this Credit Agreement and any Hedging Agreement
Provider to enter into any Secured Hedging Agreement and to extend credit hereunder and thereunder
and in recognition of the direct benefits to be received by the Guarantors from the Extensions of
Credit hereunder and any Secured Hedging Agreement, each of the Guarantors hereby agrees with the
Administrative Agent, the Lenders and the Hedging Agreement Providers as follows: each Guarantor
hereby unconditionally and irrevocably jointly and severally guarantees as primary obligor and not
merely as surety the full and prompt payment when due, whether upon maturity, by acceleration or
otherwise, of any and all indebtedness of the Borrower to the Administrative Agent, the Lenders and
the Hedging Agreement Providers. If any or all of the indebtedness becomes due and payable
hereunder or under any Secured Hedging Agreement, each Guarantor unconditionally promises to pay
such indebtedness to the Administrative Agent, the Secured Parties or their respective order, or
demand, together with any and all reasonable expenses which may be incurred by the

137

 

Administrative Agent or the Secured Parties in collecting any of the Credit Party Obligations. The
word “indebtedness” is used in this Article X in its most comprehensive sense and means any and all
advances, debts, obligations and liabilities of the Borrower arising in connection with this Credit
Agreement, the other Credit Documents or any Secured Hedging Agreement, including specifically all
Credit Party Obligations, in each case, heretofore, now, or hereafter made, incurred or created,
whether voluntarily or involuntarily, absolute or contingent, liquidated or unliquidated,
determined or undetermined, whether or not such indebtedness is from time to time reduced, or
extinguished and thereafter increased or incurred, whether the Borrower may be liable individually
or jointly with others, whether or not recovery upon such indebtedness may be or hereafter become
barred by any statute of limitations, and whether or not such indebtedness may be or hereafter
become otherwise unenforceable.

     Notwithstanding any provision to the contrary contained herein or in any other of the Credit
Documents, to the extent the obligations of a Guarantor shall be adjudicated to be invalid or
unenforceable for any reason (including, without limitation, because of any applicable state or
federal law relating to fraudulent conveyances or transfers) then the obligations of each such
Guarantor hereunder shall be limited to the maximum amount that is permissible under applicable law
(whether federal or state and including, without limitation, Bankruptcy Laws).

     Section 10.2 Bankruptcy.

     Additionally, each of the Guarantors unconditionally and irrevocably guarantees jointly and
severally the payment of any and all Credit Party Obligations of the Borrower to the Secured
Parties whether or not due or payable by the Borrower upon the occurrence of any of the events
specified in Section 7.1(f), and unconditionally promises to pay such Credit Party Obligations to
the Administrative Agent for the account of the Secured Parties, or order, on demand, in lawful
money of the United States. Each of the Guarantors further agrees that to the extent that the
Borrower or a Guarantor shall make a payment or a transfer of an interest in any property to the
Administrative Agent or any Secured Party, which payment or transfer or any part thereof is
subsequently invalidated, declared to be fraudulent or preferential, or otherwise is avoided,
and/or required to be repaid to the Borrower or a Guarantor, the estate of the Borrower or a
Guarantor, a trustee, receiver or any other party under any bankruptcy law, state or federal law,
common law or equitable cause, then to the extent of such avoidance or repayment, the obligation or
part thereof intended to be satisfied shall be revived and continued in full force and effect as if
said payment had not been made.

     Section 10.3 Nature of Liability.

     The liability of each Guarantor hereunder is exclusive and independent of any security for or
other guaranty of the Credit Party Obligations of the Borrower whether executed by any such
Guarantor, any other guarantor or by any other party, and no Guarantor’s liability hereunder shall
be affected or impaired by (a) any direction as to application of payment by the Borrower or by any
other party, or (b) any other continuing or other guaranty, undertaking (except to the extent
received and applied to the reduction by payment of the Credit Party Obligations)or maximum
liability of a guarantor or of any other party as to the Credit Party Obligations of the Borrower,
or (c) any payment on or in reduction of any such other guaranty or undertaking, or

138

 

(d) any dissolution, termination or increase, decrease or change in personnel by the Borrower, or
(e) any payment made to the Administrative Agent or any Secured Party on the Credit Party
Obligations which the Administrative Agent or such Secured Party repays the Borrower pursuant to
court order in any bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceeding, and each of the Guarantors waives any right to the deferral or modification of its
obligations hereunder by reason of any such proceeding.

     Section 10.4 Independent Obligation.

     The obligations of each Guarantor hereunder are independent of the obligations of any other
Guarantor or the Borrower, and a separate action or actions may be brought and prosecuted against
each Guarantor whether or not action is brought against any other Guarantor or the Borrower and
whether or not any other Guarantor or the Borrower is joined in any such action or actions.

     Section 10.5 Authorization.

     Each of the Guarantors authorizes the Administrative Agent and each Secured Party without
notice or demand (except as shall be required by applicable statute and cannot be waived), and
without affecting or impairing its liability hereunder, from time to time to (a) renew, compromise,
extend, increase, accelerate or otherwise change the time for payment of, or otherwise change the
terms of the Credit Party Obligations or any part thereof in accordance with this Agreement and any
Secured Hedging Agreement, as applicable, including any increase or decrease of the rate of
interest thereon, (b) take and hold security from any Guarantor or any other party for the payment
of this Guaranty or the Credit Party Obligations and exchange, enforce waive and release any such
security, (c) apply such security and direct the order or manner of sale thereof as the
Administrative Agent and the Lenders in their discretion may determine and (d) release or
substitute any one or more endorsers, Guarantors, the Borrower or other obligors.

     Section 10.6 Reliance.

     It is not necessary for the Administrative Agent or any Secured Party to inquire into the
capacity or powers of the Borrower or the officers, directors, members, partners or agents acting
or purporting to act on its behalf, and any Credit Party Obligations made or created in reliance
upon the professed exercise of such powers shall be guaranteed hereunder.

     Section 10.7 Waiver.

     (a) Each of the Guarantors waives any right (except as shall be required by applicable
statute and cannot be waived) to require the Administrative Agent or any Secured Party to
(i) proceed against the Borrower, any other guarantor or any other party, (ii) proceed
against or exhaust any security held from the Borrower, any other guarantor or any other
party, or (iii) pursue any other remedy in the Administrative Agent’s or any Secured Party’s
power whatsoever. Each of the Guarantors waives any defense based on or arising out of any
defense of the Borrower, any other guarantor or any other party

139

 

other than payment in full of the Credit Party Obligations (other than contingent indemnity
obligations), including without limitation any defense based on or arising out of the
disability of the Borrower, any other guarantor or any other party, or the unenforceability
of the Credit Party Obligations or any part thereof from any cause, or the cessation from
any cause of the liability of the Borrower other than payment in full of the Credit Party
Obligations. The Administrative Agent may, at its election, foreclose on any security held
by the Administrative Agent by one or more judicial or nonjudicial sales (to the extent such
sale is permitted by applicable law), or exercise any other right or remedy the
Administrative Agent or any Lender may have against the Borrower or any other party, or any
security, without affecting or impairing in any way the liability of any Guarantor hereunder
except to the extent the Credit Party Obligations have been paid in full and the Commitments
have been terminated. Each of the Guarantors waives any defense arising out of any such
election by the Administrative Agent or any of the Lenders, even though such election
operates to impair or extinguish any right of reimbursement or subrogation or other right or
remedy of the Guarantors against the Borrower or any other party or any security.

     (b) Each of the Guarantors waives all presentments, demands for performance, protests
and notices, including without limitation notices of nonperformance, notice of protest,
notices of dishonor, notices of acceptance of this Guaranty, and notices of the existence,
creation or incurring of new or additional Credit Party Obligations. Each Guarantor assumes
all responsibility for being and keeping itself informed of the Borrower’s financial
condition and assets, and of all other circumstances bearing upon the risk of nonpayment of
the Credit Party Obligations and the nature, scope and extent of the risks which such
Guarantor assumes and incurs hereunder, and agrees that neither the Administrative Agent nor
any Lender shall have any duty to advise such Guarantor of information known to it regarding
such circumstances or risks.

     (c) Each of the Guarantors hereby agrees it will not exercise any rights of subrogation
which it may at any time otherwise have as a result of this Guaranty (whether contractual,
under Section 509 of the Bankruptcy Code, or otherwise) to the claims of any Secured Party
against the Borrower or any other guarantor of the Credit Party Obligations of the Borrower
owing to such Secured Party (collectively, the “Other Parties”) and all contractual,
statutory or common law rights of reimbursement, contribution or indemnity from any Other
Party which it may at any time otherwise have as a result of this Guaranty until such time
as the Credit Party Obligations shall have been paid in full and the Commitments have been
terminated. Each of the Guarantors hereby further agrees not to exercise any right to
enforce any other remedy which the Administrative Agent or any Secured Party now have or may
hereafter have against any Other Party, any endorser or any other guarantor of all or any
part of the Credit Party Obligations of the Borrower and any benefit of, and any right to
participate in, any security or collateral given to or for the benefit of the Secured
Parties to secure payment of the Credit Party Obligations of the Borrower until such time as
the Credit Party Obligations (other than contingent indemnity obligations) shall have been
paid in full and the Commitments have been terminated.

140

 

     Section 10.8 Limitation on Enforcement.

     The Secured Parties agree that this Guaranty may be enforced only by the action of the
Administrative Agent acting upon the instructions of the Required Secured Parties and that no
Secured Party shall have any right individually to seek to enforce or to enforce this Guaranty, it
being understood and agreed that such rights and remedies may be exercised by the Administrative
Agent for the benefit of the Secured Parties under the terms of this Credit Agreement and under any
Secured Hedging Agreement. The Secured Parties further agree that this Guaranty may not be
enforced against any director, officer, employee or stockholder of the Guarantors.

     Section 10.9 Confirmation of Payment.

     The Administrative Agent and the Lenders will, upon request after payment of the indebtedness
and obligations which are the subject of this Guaranty and termination of the Commitments relating
thereto, confirm to the Borrower, the Guarantors or any other Person that such indebtedness and
obligations have been paid and the Commitments relating thereto terminated, subject to the
provisions of Section 10.2.

[REMAINDER OF PAGE INTENTIONALLY BLANK]

141

 

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

	 	 	 	 	 	 	 
	BORROWER:	 	GENCORP INC., 

an Ohio corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ William M. Lau	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	William M. Lau	 	 
	 

	 	Title:
	 	Vice President and Treasurer	 	 

	 	 	 	 	 	 	 
	GUARANTORS:	 	AEROJET-GENERAL CORPORATION,

an Ohio corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ William M. Lau	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	William M. Lau	 	 
	 

	 	Title:
	 	Vice President and Treasurer	 	 

	 	 	 	 	 	 	 
	 	 	AEROJET ORDNANCE TENNESSEE, INC.,

a Tennessee corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Diane L. Wallace	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Diane L. Wallace	 	 
	 

	 	Title:
	 	Vice President	 	 

AMENDED AND RESTATED CREDIT AGREEMENT

GENCORP INC.

 

 

	 	 	 	 	 	 	 
	ADMINISTRATIVE AGENT
	 	 	 	 	 	 
	AND LENDERS:	 	WACHOVIA BANK, NATIONAL
ASSOCIATION,

as Administrative Agent and as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ William F. Fox	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	William F. Fox	 	 
	 

	 	Title:
	 	Director	 	 

AMENDED AND RESTATED CREDIT AGREEMENT

GENCORP INC.

 

 

	 	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A.,

as Syndication Agent and as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Richard C. Smith
	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	RICHARD C. SMITH	 	 
	 

	 	Title:
	 	EXECUTIVE DIRECTOR	 	 

AMENDED AND RESTATED CREDIT AGREEMENT

GENCORP INC.

 

 

	 	 	 	 	 	 	 
	 	 	Wells Fargo Bank, National Association

as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ D M Contreras	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	D M Contreras	 	 
	 

	 	Title:
	 	Vice President	 	 

AMENDED AND RESTATED CREDIT AGREEMENT

GENCORP INC.

 

 

	 	 	 	 	 	 	 
	 	 	National City Bank

as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Tom Gurbach
	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Tom Gurbach	 	 
	 

	 	Time:
	 	Vice President	 	 

AMENDED AND RESTATED CREDIT AGREEMENT

GENCORP INC.

 

 

	 	 	 	 	 	 	 
	 	 	CIT Group/Equipment Finance

as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Anbrew Giangrave	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	ANBREW GIANGRAVE	 	 
	 

	 	Title:
	 	MANAGING DIRECTOR	 	 
	 

	 	 	 	CIT GROUP	 	 

AMENDED AND RESTATED CREDIT AGREEMENT

GENCORP INC.exv4w1

 

Exhibit 4.1

NOVINT TECHNOLOGIES, INC.

AMENDED AND RESTATED

2004 STOCK INCENTIVE PLAN

ARTICLE ONE

GENERAL PROVISIONS

I. PURPOSE OF THE PLAN

     This Amended and Restated 2004 Stock Incentive Plan (the “Plan”) is intended to promote the
interests of Novint Technologies, Inc., a Delaware corporation (the “Corporation”) by providing
eligible persons with the opportunity to acquire a proprietary interest, or otherwise increase
their proprietary interest, in the Corporation as an incentive for them to remain in the Service of
the Corporation. Capitalized terms not defined herein, shall have the meanings assigned to them in
the attached Appendix.

II. STRUCTURE OF THE PLAN

     A. The Plan shall have a Discretionary Option Grant Program under which eligible persons may,
at the discretion of the Plan Administrator, be granted options to purchase shares of Common Stock.

     B. The provisions of Articles One and Three shall apply to all equity programs under the Plan
and shall govern the interests of all persons under the Plan.

III. ADMINISTRATION OF THE PLAN

     A. The Plan shall be administered by the Board or one or more committees appointed by the
Board, provided that (1) beginning with the Section 12 Registration Date, the Primary Committee
shall have sole and exclusive authority to administer the Plan with respect to Section 16 Insiders,
and (2) administration of the Plan may otherwise, at the Board’s discretion, be vested in the
Primary Committee or a Secondary Committee. Beginning with the Section 12 Registration Date, any
discretionary option grants or stock issuances to members of the Primary Committee must be
authorized and approved by a disinterested majority of the Board.

     B. Members of the Primary Committee or any Secondary Committee shall serve for such period of
time as the Board may determine and may be removed by the Board at any time. The Board may also at
any time terminate the functions of any Secondary Committee and reassume all powers and authority
previously delegated to such committee.

     C. Each Plan Administrator shall, within the scope of its administrative functions under the
Plan, have full power and authority (subject to the provisions of the Plan) to establish such rules
and regulations as it may deem appropriate for proper administration of the Discretionary Option
Grant to make such determinations under, and issue such interpretations of, the provisions of such
programs and any outstanding options or stock issuances thereunder as it may deem necessary or
advisable. Decisions of the Plan Administrator within the scope of its administrative functions
under the Plan shall be final and

-1-

 

binding on all parties who have an interest in the Discretionary Option Grant under its
jurisdiction or any option or stock issuance thereunder.

     D. Service on the Primary Committee or the Secondary Committee shall constitute service as a
Board member, and members of each such committee shall accordingly be entitled to full
indemnification and reimbursement as Board members for their service on such committee. No member
of the Primary Committee or the Secondary Committee shall be liable for any act or omission made in
good faith with respect to the Plan or any option grants or stock issuances under the Plan.

IV. ELIGIBILITY

     A. The persons eligible to participate in the Discretionary Option Grant are as follows:

          (i) Employees,

          (ii) non-employee members of the Board or the board of directors of any Subsidiary, and

          (iii) consultants and other independent advisors who provide services to the
Corporation (or any Subsidiary).

     B. Each Plan Administrator shall, within the scope of its administrative jurisdiction under
the Plan, have full authority to determine with respect to the option grants under the
Discretionary Option Grant Program, which eligible persons are to receive grants, the time or times
when such grants are to be made, the number of shares to be covered by each such grant, the status
of a granted option as either an Incentive Option or a Non-Statutory Option, the time or times when
each option is to become exercisable, the vesting schedule (if any) applicable to the option shares
and the maximum term for which the option is to remain outstanding.

     C. The Plan Administrator shall have the absolute discretion to grant options in accordance
with the Discretionary Option Grant Program.

V. STOCK SUBJECT TO THE PLAN

     A. The stock issuable under the Plan shall be shares of authorized but unissued or reacquired
Common Stock, including shares repurchased by the Corporation on the open market. The maximum
number of shares of Common Stock initially reserved for issuance over the term of the Plan shall
not exceed 7,500,000 shares.

     B. Shares of Common Stock subject to outstanding options shall be available for subsequent
issuance under the Plan to the extent (i) those options expire or terminate for any reason prior to
exercise in full or (ii) the options are cancelled in accordance with the cancellation-regrant
provisions of Article Two. Unvested shares issued under the Plan and subsequently cancelled by the
Corporation shall be added back to the number of shares of Common Stock reserved for issuance under
the Plan and shall accordingly be available for reissuance through one or more subsequent option
grants under the Plan. In addition, should the exercise price of an option under the Plan be paid
with shares of Common Stock or should shares of Common Stock otherwise issuable under the Plan be
withheld by the Corporation in satisfaction of the withholding taxes incurred in connection with
the exercise of an option or the vesting of a stock issuance under the Plan, then the number of
shares of Common Stock available for issuance under the Plan shall be reduced only by the net
number of shares of Common Stock issued to the holder

-2-

 

of such option or stock issuance, and not by the gross number of shares for which the option
is exercised or which vest under the stock issuance.

     C. If any change is made to the Common Stock by reason of any stock split, stock dividend,
recapitalization, combination of shares, exchange of shares or other change affecting the
outstanding Common Stock as a class without the Corporation’s receipt of consideration, appropriate
adjustments shall be made to: (i) the maximum number and/or class of securities issuable under the
Plan; (ii) the number and/or class of securities for which any one person may be granted stock
options under this Plan per calendar year; and (iii) the number and/or class of securities and the
exercise price per share in effect under each outstanding option under the Plan. Such adjustments
to the outstanding options are to be effected in a manner which shall preclude the enlargement or
dilution of rights and benefits under such options. The adjustments determined by the Plan
Administrator shall be final, binding and conclusive.

ARTICLE TWO

DISCRETIONARY OPTION GRANT PROGRAM

I. OPTION TERMS

     Each option shall be evidenced by one or more documents in the form approved by the Plan
Administrator; provided, however, that each such document shall comply with the terms specified
below. Each document evidencing an Incentive Option shall, in addition, be subject to the
provisions of the Plan applicable to such option.

     A. EXERCISE PRICE.

          1. The exercise price per share shall be fixed by the Plan Administrator but shall not be less
than eighty-five percent (85%) of the Fair Market Value per share of Common Stock on the option
grant date, except that the exercise price shall not be less than one hundred ten percent (110%) of
the Fair Market Value per share of Common Stock on the option grant date in the case of any person
who owns stock possessing more than ten percent (10%) of the total combined voting power of all
classes of stock of the Corporation or its subsidiary corporations.

          2. The exercise price shall become immediately due upon exercise of the option and may,
subject to the provisions of Section I of Article Three, be payable by cash or check made payable
to the Corporation; provided however, the Plan Administrator may, at its sole discretion, provide
grantees with the ability to exercise their options using the cashless exercise method, as set
forth in their Option Agreements. Payment of the exercise price for the purchased shares must be
made on the Exercise Date, except as otherwise provided by the Plan Administrator.

     B. EXERCISE AND TERM OF OPTIONS. Each option shall be exercisable at such time or times,
during such period and for such number of shares as shall be determined by the Plan Administrator
and set forth in the documents evidencing the option. However, no option shall have a term in
excess of ten (10) years measured from the option grant date.

     C. EFFECT OF TERMINATION OF SERVICE.

          1. The following provisions shall govern the exercise of any options held by the Optionee at
the time of cessation of Service or death:

-3-

 

          (i) Any option outstanding at the time of the Optionee’s cessation of Service for any
reason shall remain exercisable for such period of time thereafter as shall be determined by
the Plan Administrator and set forth in the documents evidencing the option.

          (ii) Any option held by the Optionee at the time of death and exercisable in whole or
in part at that time may be subsequently exercised by the personal representative of the
Optionee’s estate or by the person or persons to whom the option is transferred pursuant to
the Optionee’s will or in accordance with the laws of descent and distribution of by the
Optionee’s designated beneficiary or beneficiaries of that option.

          (iii) Should the Optionee’s Service be terminated for Misconduct or should the Optionee
otherwise engage in Misconduct while holding one or more outstanding options under this
Article Two, then all those options shall terminate immediately and cease to be outstanding.

          (iv) During the applicable post-Service exercise period, the option may not be
exercised in the aggregate for more than the number of vested shares for which the option is
exercisable on the date of the Optionee’s cessation of Service. Upon the expiration of the
applicable exercise period or (if earlier) upon the expiration of the option term, the
option shall terminate and cease to be outstanding for any vested shares for which the
option has not been exercised. However, the option shall, immediately upon the Optionee’s
cessation of Service, terminate and cease to be outstanding to the extent the option is not
otherwise at that time exercisable for vested shares.

     2. The Plan Administrator shall have complete discretion, either at the time an option is
granted or at any time while the option remains outstanding, to:

          (i) extend the period of time for which the option is to remain exercisable following
the Optionee’s cessation of Service from the limited exercise period otherwise in effect for
that option to such greater period of time as the Plan Administrator shall deem appropriate,
but in no event beyond the expiration of the option term, and/or

          (ii) permit the option to be exercised, during the applicable post-Service exercise
period, not only with respect to the number of vested shares of Common Stock for which such
option is exercisable at the time of the Optionee’s cessation of Service but also with
respect to one or more additional installments in which the Optionee would have vested had
the Optionee continued in Service.

     D. NO STOCKHOLDER RIGHTS. The holder of an option shall have no stockholder rights with
respect to the shares subject to the option until such person shall have exercised the option, paid
the exercise price and become a holder of record of the purchased shares.

     E. LIMITED TRANSFERABILITY OF OPTIONS. During the lifetime of the Optionee, Incentive Options
shall be exercisable only by the Optionee and shall not be assignable or transferable other than by
will or by the laws of descent and distribution following the Optionee’s death. Non-Statutory
Options shall be subject to the same limitation, except that a Non-Statutory Option may be assigned
in whole or in part during Optionee’s lifetime to one or more members of the Optionee’s Immediate
Family or to a trust established for the exclusive benefit of one or more family members or the
Optionee’s former spouse, to the extent such assignment is in connection with Optionee’s estate
plan or pursuant to a domestic relations order. The assigned portion shall be exercisable only by
the person or persons who acquire a proprietary interest in the option pursuant to such assignment.
The terms

-4-

 

applicable to the assigned portion shall be the same as those in effect for this option
immediately prior to such assignment and shall be set forth in such documents issued to the
assignee as the Plan Administrator may deem appropriate. Notwithstanding the foregoing, the
Optionee may also designate one or more persons as the beneficiary or beneficiaries of his or her
outstanding options under this Article Two, and those options shall, in accordance with such
designation, automatically be transferred to such beneficiary or beneficiaries upon the Optionee’s
death while holding those options. Such beneficiary or beneficiaries shall take the transferred
option subject to all the terms and conditions of this Agreement, including (without limitation)
the limited time period during which the option may be exercised following the Optionee’s death.

     F. REGISTRATION RIGHTS. The Plan Administrator may also, at its sole discretion, grant piggy
back registration rights with respect to shares issuable upon exercise of the Options granted
hereunder.

II. INCENTIVE OPTIONS

     The terms specified below shall be applicable to all Incentive Options. Except as modified by
the provisions of this Section II, all the provisions of Articles One, Two and Three shall be
applicable to Incentive Options. Options which are specifically designated as Non-Statutory
Options when issued under the Plan shall NOT be subject to the terms of this Section II.

     A. ELIGIBILITY. Incentive Options may only be granted to Employees.

     B. EXERCISE PRICE. The exercise price per share shall not be less than one hundred percent
(100%) of the Fair Market Value per share of Common Stock on the option grant date.

     C. DOLLAR LIMITATION. The aggregate Fair Market Value of the shares of Common Stock
(determined as of the respective date or dates of grant) for which one or more options granted to
any Employee under the Plan (or any other option plan of the Corporation or any Subsidiary) may for
the first time become exercisable as Incentive Options during any one calendar year shall not
exceed the sum of One Hundred Thousand Dollars ($100,000). To the extent the Employee holds two
(2) or more such options which become exercisable for the first time in the same calendar year, the
foregoing limitation on the exercisability of such options as Incentive Options shall be applied on
the basis of the order in which such options are granted.

     D. FAILURE TO QUALIFY AS INCENTIVE OPTION. To the extent that any option governed by this
Plan does not qualify as an Incentive Option by reason of the dollar limitation described in
Section II.C of Article Two or for any other reason, such option shall be exercisable as a
Non-Statutory Option under the Federal tax laws.

     E. 10% STOCKHOLDER. If any Employee to whom an Incentive Option is granted is a 10%
Stockholder, then the exercise price per share shall not be less than one hundred ten percent
(110%) of the Fair Market Value per share of Common Stock on the option grant date, and the option
term shall not exceed five (5) years measured from the option grant date.

III. CANCELLATION AND REGRANT OF OPTIONS

     The Plan Administrator shall have the authority to effect, at any time and from time to time,
with the consent of the affected option holders, the cancellation of any or all outstanding options
under the Discretionary Option Grant Program and to grant in substitution new options covering the
same or

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different number of shares of Common Stock but with an exercise price per share based on the
Fair Market Value per share of Common Stock on the new grant date.

IV. CHANGE IN CONTROL/HOSTILE TAKE-OVER

     A. No option outstanding at the time of a Change in Control shall become exercisable on an
accelerated basis if and to the extent: (i) that option is, in connection with the Change in
Control, assumed by the successor corporation (or Parent thereof) or otherwise continued in full
force and effect pursuant to the terms of the Change in Control transaction, (ii) such option is
replaced with a cash incentive program of the successor corporation which preserves the spread
existing at the time of the Change in Control on the shares of Common Stock for which the option is
not otherwise at that time exercisable and provides for subsequent payout in accordance with the
same exercise/vesting schedule applicable to those option shares or (iii) the acceleration of such
option is subject to other limitations imposed by the Plan Administrator at the time of the option
grant. However, if none of the foregoing conditions are satisfied, then each option outstanding at
the time of the Change in Control but not otherwise exercisable for all the shares of Common Stock
at that time subject to such option shall automatically accelerate so that each such option shall,
immediately prior to the effective date of the Change in Control, become exercisable for all the
shares of Common Stock at the time subject to such option and may be exercised for any or all of
those shares as fully vested shares of Common Stock.

     B. Immediately following the consummation of the Change in Control, all outstanding options
shall terminate and cease to be outstanding, except to the extent assumed by the successor
corporation (or Parent thereof) or otherwise expressly continued in full force and effect pursuant
to the terms of the Change in Control transaction.

     C. Each option which is assumed in connection with a Change in Control or otherwise continued
in effect shall be appropriately adjusted, immediately after such Change in Control, to apply to
the number and class of securities which would have been issuable to the Optionee in consummation
of such Change in Control had the option been exercised immediately prior to such Change in
Control. Appropriate adjustments to reflect such Change in Control shall also be made to: (i) the
exercise price payable per share under each outstanding option, provided the aggregate exercise
price payable for such securities shall remain the same; (ii) the maximum number and/or class of
securities available for issuance over the remaining term of the Plan; and (iii) the maximum number
and/or class of securities for which any one person may be granted options under the Plan per
calendar year. To the extent the actual holders of the Corporation’s outstanding Common Stock
receive cash consideration for their Common Stock in consummation of the Change in Control
transaction, the successor corporation may, in connection with the assumption of the outstanding
options under the Discretionary Option Grant Program, substitute one or more shares of its own
common stock with a fair market value equivalent to the cash consideration paid per share of Common
Stock in such Change in Control transaction.

     D. The Plan Administrator shall have the discretionary authority to structure one or more
outstanding options under the Discretionary Option Grant Program so that those options shall,
immediately prior to the effective date of a Change in Control, become exercisable for all the
shares of Common Stock at that time subject to such options on an accelerated basis and may be
exercised for any or all of such shares as fully vested shares of Common Stock, whether or not
those options are to be assumed or otherwise continued in full force and effect pursuant to the
express terms of the Change in Control transaction.

     E. The Plan Administrator shall have full power and authority to structure one or more
outstanding options under the Discretionary Option Grant Program so that those options shall vest
and become exercisable for all the shares of Common Stock at that time subject to such options on
an

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accelerated basis in the event the Optionee’s Service is subsequently terminated by reason of
an Involuntary Termination within a designated period (not to exceed eighteen (18) months)
following the effective date of any Change in Control in which those options do not otherwise
accelerate. Any options so accelerated shall remain exercisable for fully vested shares of Common
Stock until the expiration or sooner termination of the option term.

     F. The Plan Administrator shall have the discretionary authority to structure one or more
outstanding options under the Discretionary Option Grant Program so that those options shall,
immediately prior to the effective date of a Hostile Take-Over, vest and become exercisable for all
the shares of Common Stock at that time subject to such options on an accelerated basis and may be
exercised for any or all of such shares as fully vested shares of Common Stock.

     G. The portion of any Incentive Option accelerated in connection with a Change in Control or
Hostile Take-Over shall remain exercisable as an Incentive Option only to the extent the applicable
One Hundred Thousand Dollar ($100,000) limitation is not exceeded. To the extent such dollar
limitation is exceeded, the accelerated portion of such option shall be exercisable as a
Non-Statutory Option under the Federal tax laws.

     H. The grant of options under the Discretionary Option Grant Program shall in no way affect
the right of the Corporation to adjust, reclassify, reorganize or otherwise change its capital or
business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any
part of its business or assets.

ARTICLE THREE

MISCELLANEOUS

I. FINANCING

     The Plan Administrator may permit any Optionee to pay the option exercise price under the
Discretionary Option Grant Program by delivering a full-recourse, interest bearing promissory note
payable in one or more installments. The terms of any such promissory note (including the interest
rate and the terms of repayment) shall be established by the Plan Administrator in its sole
discretion. In no event may the maximum credit available to the Optionee exceed the sum of (i) the
aggregate option exercise price or purchase price payable for the purchased shares plus (ii) any
Federal, state and local income and employment tax liability incurred by the Optionee in connection
with the option exercise or share purchase.

II. TAX WITHHOLDING

     The Corporation’s obligation to deliver shares of Common Stock upon the exercise of options or
the issuance or vesting of such shares under the Plan shall be subject to the satisfaction of all
applicable Federal, state and local income and employment tax withholding requirements.

III. EFFECTIVE DATE AND TERM OF THE PLAN

     A. The Plan shall become effective immediately upon the Plan Effective Date. Options may
be granted under the Discretionary Option Grant at any time on or after the Plan Effective Date.
However, no options granted under the Plan may be exercised, and no shares shall be issued under
the Plan, until the Plan is approved by the Corporation’s stockholders. If such stockholder
approval is not obtained within twelve (12) months after the Plan Effective Date, then all options
previously granted

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under this Plan shall terminate and cease to be outstanding, and no further options shall be
granted and no shares shall be issued under the Plan.

     B. The Plan shall terminate upon the EARLIEST of (i) the tenth anniversary of the Plan
Effective Date, (ii) the date on which all shares available for issuance under the Plan shall have
been issued as fully-vested shares or (iii) the termination of all outstanding options in
connection with a Change in Control. Upon such plan termination, all outstanding option grants and
unvested stock issuances shall thereafter continue to have force and effect in accordance with the
provisions of the documents evidencing such grants or issuances.

IV. AMENDMENT OF THE PLAN

     A. The Board shall have complete and exclusive power and authority to amend or modify the Plan
in any or all respects. However, no such amendment or modification shall adversely affect the
rights and obligations with respect to stock options or unvested stock issuances at the time
outstanding under the Plan unless the Optionee consents to such amendment or modification. In
addition, certain amendments may require stockholder approval pursuant to applicable laws or
regulations.

     B. Options to purchase shares of Common Stock may be granted under the Discretionary Option
Grant Program that are in each instance in excess of the number of shares then available for
issuance under the Plan, provided any excess shares actually issued under those programs shall be
held in escrow until there is obtained any required approval of an amendment sufficiently
increasing the number of shares of Common Stock available for issuance under the Plan. If such
approval is not obtained within twelve (12) months after the date the first such excess issuances
are made, then (i) any unexercised options granted on the basis of such excess shares shall
terminate and cease to be outstanding and (ii) the Corporation shall promptly refund to the
Optionees the exercise or purchase price paid for any excess shares issued under the Plan and held
in escrow, together with interest (at the applicable Short Term Federal Rate) for the period the
shares were held in escrow, and such shares shall thereupon be automatically cancelled and cease to
be outstanding.

V. USE OF PROCEEDS

     Any cash proceeds received by the Corporation from the sale of shares of Common Stock under
the Plan shall be used for general corporate purposes.

VI. REGULATORY APPROVALS

     A. The implementation of the Plan, the granting of any stock option under the Plan and the
issuance of any shares of Common Stock upon the exercise of any granted option shall be subject to
the Corporation’s procurement of all approvals and permits required by regulatory authorities
having jurisdiction over the Plan, the stock options granted under it and the shares of Common
Stock issued pursuant to it.

     B. No shares of Common Stock or other assets shall be issued or delivered under the Plan
unless and until there shall have been compliance with all applicable requirements of Federal and
state securities laws, including the filing and effectiveness of the Form S-8 registration
statement for the shares of Common Stock issuable under the Plan, and all applicable listing
requirements of any stock exchange (or the Nasdaq National Market, if applicable) on which Common
Stock is then listed for trading.

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VII. NO EMPLOYMENT/SERVICE RIGHTS

     Nothing in the Plan shall confer upon the Optionee any right to continue in Service for any
period of specific duration or interfere with or otherwise restrict in any way the rights of the
Corporation (or any Subsidiary employing or retaining such person) or of the Optionee, which rights
are hereby expressly reserved by each, to terminate such person’s Service at any time for any
reason, with or without cause.

X. FINANCIAL REPORTS

     The Corporation shall deliver financial reports and other information if such reports and
information is required to be delivered pursuant to applicable law.

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APPENDIX

     The following definitions shall be in effect under the Plan:

A. BOARD shall mean the Corporation’s Board of Directors.

B. CHANGE IN CONTROL shall mean a change in ownership or control of the Corporation effected
through any of the following transactions:

     (i) a stockholder-approved merger or consolidation in which securities possessing more than
fifty percent (50%) of the total combined voting power of the Corporation’s outstanding securities
are transferred to a person or persons different from the persons holding those securities
immediately prior to such transaction;

     (ii) a sale, transfer or other disposition of all or substantially all of the Corporation’s
assets; or

     (iii) the acquisition, directly or indirectly by any person or related group of persons (other
than the Corporation or a person that directly or indirectly controls, is controlled by, or is
under common control with, the Corporation), of beneficial ownership (within the meaning of Rule
13d-3 of the 1934 Act) of securities possessing more than fifty percent (50%) of the total combined
voting power of the Corporation’s outstanding securities pursuant to a tender or exchange offer
made directly to the Corporation’s stockholders which the Board recommends such stockholders
accept.

C. CODE shall mean the Internal Revenue Code of 1986, as amended.

D. COMMON STOCK shall mean the Corporation’s common stock.

E. CORPORATION shall mean Novint Technologies, Inc., a Delaware corporation, and its successors.

F. DISCRETIONARY OPTION GRANT PROGRAM shall mean the discretionary option grant program in effect
under the Plan.

G. EMPLOYEE shall mean an individual who is in the employ of the Corporation (or any Subsidiary),
subject to the control and direction of the employer entity as to both the work to be performed and
the manner and method of performance.

H. EXERCISE DATE shall mean the date on which the Corporation shall have received written notice of
the option exercise.

I. FAIR MARKET VALUE per share of Common Stock on any relevant date shall be determined in
accordance with the following provisions:

     (i) if the Common Stock is then listed or quoted on a Trading Market, the Fair Market Value is
the daily volume weighted average price per share of the Common Stock for such date (or the nearest
preceding date) on the primary Trading Market on which the Common Stock is then listed or quoted;

     (ii) if the Common Stock is not then listed or quoted on an Trading Market and if prices for
the Common Stock are then reported in the “Pink Sheets” published by the National Quotation Bureau
Incorporated (or a similar organization or agency succeeding to its functions of reporting prices),
the Fair Market Value is the most recent bid price per share of the Common Stock so reported; or

-1-

 

     (iii) in all other cases, the Fair Market Value of a share of Common Stock shall be determined
by the Plan Administrator after taking into account such factors as the Plan Administrator shall
deem appropriate.

J. HOSTILE TAKE-OVER shall mean:

     (i) the acquisition, directly or indirectly, by any person or related group of persons (other
than the Corporation or a person that directly or indirectly controls, is controlled by, or is
under common control with, the Corporation) of beneficial ownership (within the meaning of Rule
13d-3 of the 1934 Act) of securities possessing more than fifty percent (50%) of the total combined
voting power of the Corporation’s outstanding securities pursuant to a tender or exchange offer
made directly to the Corporation’s stockholders which the Board does not recommend such
stockholders to accept; or

     (ii) a change in the composition of the Board over a period of thirty-six (36) consecutive
months or less such that a majority of the Board members ceases, by reason of one or more contested
elections for Board membership, to be comprised of individuals who either: (a) have been Board
members continuously since the beginning of such period; or (b) have been elected or nominated for
election as Board members during such period by at least a majority of the Board members described
in clause (a) who were still in office at the time the Board approved such election or nomination.

K. IMMEDIATE FAMILY shall mean any child, stepchild, grandchild, parent, stepparent, grandparent,
spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or
sister-in-law, and shall include adoptive relationships.

L. INCENTIVE OPTION shall mean an option which satisfies the requirements of Code Section 422.

     (i) INVOLUNTARY TERMINATION shall mean the termination of the Service of any individual which
occurs by reason of such individual’s involuntary dismissal or discharge by the Corporation for
reasons other than Misconduct.

M. MISCONDUCT shall mean the commission of any act of fraud, embezzlement or dishonesty by the
Optionee, any unauthorized use or disclosure by such person of confidential information or trade
secrets of the Corporation (or any Subsidiary), or any other intentional misconduct by such person
adversely affecting the business or affairs of the Corporation (or any Subsidiary) in a material
manner. The foregoing definition shall not be deemed to be inclusive of all the acts or omissions
which the Corporation (or any Subsidiary) may consider as grounds for the dismissal or discharge of
any Optionee or other person in the Service of the Corporation (or any Subsidiary).

N. 1934 ACT shall mean the Securities Exchange Act of 1934, as amended.

O. NON-STATUTORY OPTION shall mean an option not intended to satisfy the requirements of Code
Section 422.

P. OPTIONEE shall mean any person to whom an option is granted under the Discretionary Option Grant
Program.

Q. PARENT shall mean any corporation (other than the Corporation) in an unbroken chain of
corporations ending with the Corporation, provided each corporation in the unbroken chain (other
than the Corporation) owns, at the time of the determination, stock possessing fifty percent (50%)
or more of the total combined voting power of all classes of stock in one of the other corporations
in such chain.

-2-

 

R. PLAN shall mean the Corporation’s 2004 Stock Incentive Plan, as set forth in this document.

S. PLAN ADMINISTRATOR shall mean the particular entity, whether the Primary Committee, the Board or
the Secondary Committee, which is authorized to administer the Discretionary Option Grant with
respect to one or more classes of eligible persons, to the extent such entity is carrying out its
administrative functions under those programs with respect to the persons under its jurisdiction.

T. PLAN EFFECTIVE DATE shall mean the date on which the Plan was adopted by the Board.

U. PRIMARY COMMITTEE shall mean the committee of two (2) or more non-employee Board members
appointed by the Board to administer the Discretionary Option Grant with respect to Section 16
Insiders following the Section 12 Registration Date.

V. SECONDARY COMMITTEE shall mean a committee of two (2) or more Board members appointed by the
Board to administer any aspect of Plan not required hereunder to be administered by the Primary
Committee. The members of the Secondary Committee may be Board members who are Employees eligible
to receive discretionary option grants, stock bonus or other stock plan of the Corporation (or any
Subsidiary).

W. SECTION 12 REGISTRATION DATE shall mean the date on which the Common Stock is first registered
under Section 12(g) or Section 15 of the 1934 Act.

X. SECTION 16 INSIDER shall mean an officer or director of the Corporation subject to the
short-swing profit liabilities of Section 16 of the 1934 Act.

Y. SERVICE shall mean the performance of services for the Corporation (or any Subsidiary) by a
person in the capacity of an Employee, a non-employee member of the board of directors or a
consultant or independent advisor, except to the extent otherwise specifically provided in the
documents evidencing the option grant or stock issuance.

Z. SHORT TERM FEDERAL RATE shall mean the federal short-term rate in effect under Section 1274(d)
of the Code for the period the shares were held in escrow.

AA. STOCK EXCHANGE shall mean either the American Stock Exchange or the New York Stock Exchange.

BB. SUBSIDIARY shall mean any corporation (other than the Corporation) in an unbroken chain of
corporations beginning with the Corporation, provided each corporation (other than the last
corporation) in the unbroken chain owns, at the time of the determination, stock possessing fifty
percent (50%) or more of the total combined voting power of all classes of stock in one of the
other corporations in such chain.

CC. TAXES shall mean the Federal, state and local income and employment tax liabilities incurred by
the holder of Non-Statutory Options or unvested shares of Common Stock in connection with the
exercise of those options or the vesting of those shares.

DD. TRADING MARKET means the following markets or exchanges on which the Common Stock is listed or
quoted for trading on the date in question: the OTC Bulletin Board, the American Stock Exchange,
the New York Stock Exchange, the Nasdaq National Market or the Nasdaq SmallCap Market.

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EE. 10% STOCKHOLDER shall mean the owner of stock (as determined under Code Section 424(d))
possessing more than ten percent (10%) of the total combined voting power of all classes of stock
of the Corporation (or any Subsidiary).

-4-

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