Document:

exv10w1

 

EXHIBIT 10.1

AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT,

dated as of March 29, 2007,

among

STERLING CHEMICALS, INC.

AND

EACH OF ITS SUBSIDIARIES

PARTIES HERETO FROM TIME TO TIME,

as the Borrowers,

VARIOUS FINANCIAL INSTITUTIONS PARTIES HERETO FROM TIME TO TIME,

as the Lenders,

THE CIT GROUP/BUSINESS CREDIT, INC.,

as a Lender and as the Administrative Agent

and

WACHOVIA BANK, NATIONAL ASSOCIATION

as Documentation Agent

 

TABLE OF CONTENTS

	 	 	 	 	 
	Section	 	Page
	ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
	 	 	2	 
	SECTION 1.1. Defined Terms
	 	 	2	 
	SECTION 1.2. Use of Defined Terms
	 	 	36	 
	SECTION 1.3. Cross-References
	 	 	37	 
	SECTION 1.4. Accounting and Financial Determinations
	 	 	37	 
	ARTICLE II TERMS OF COMMITMENTS AND LOANS
	 	 	37	 
	SECTION 2.1. Commitments
	 	 	37	 
	2.1.1. Loan Commitments
	 	 	37	 
	2.1.2. Letter of Credit Commitment
	 	 	37	 
	2.1.3. Lenders Not Permitted or Required to Make Loans.
	 	 	38	 
	SECTION 2.2. Reduction of the Commitment Amounts
	 	 	38	 
	2.2.1. Optional
	 	 	38	 
	2.2.2. Mandatory
	 	 	39	 
	2.2.3. Termination of Agreement
	 	 	39	 
	SECTION 2.3. Borrowing Procedures and Funding Maintenance
	 	 	39	 
	2.3.1. Borrowing Revolving Credit Loans.
	 	 	39	 
	2.3.2. Borrowing Swing Line Loans.
	 	 	41	 
	2.3.3. Joint and Several Liability; Rights of Contribution
	 	 	42	 
	SECTION 2.4. Continuation and Conversion Elections
	 	 	44	 
	SECTION 2.5. Funding
	 	 	45	 
	SECTION 2.6. Letter of Credit Issuance Procedures
	 	 	45	 
	2.6.1. Other Lenders’ Participation
	 	 	45	 
	2.6.2. Disbursements: Conversion to Loans
	 	 	46	 
	2.6.3. Reimbursement
	 	 	47	 
	2.6.4. Deemed Disbursements
	 	 	48	 
	2.6.5. Additional Letter of Credit Provisions
	 	 	48	 
	SECTION 2.7. Register; Notes; Obligation Account; Reserves
	 	 	49	 
	ARTICLE III PAYMENTS; PREPAYMENTS; INTEREST AND FEES
	 	 	52	 
	SECTION 3.1. Payments; Application; Controlled Deposit Accounts; Power of Attorney; Charges
to Obligation Account; No Discharge
	 	 	52	 

i

 

	 	 	 	 	 
	Section	 	Page
	3.1.1. Repayments and Prepayments
	 	 	52	 
	3.1.2. Application
	 	 	54	 
	3.1.3. Matters Relating to Controlled Deposit Accounts
	 	 	54	 
	3.1.4. Power of Attorney
	 	 	57	 
	3.1.5. Charges to Obligation Account
	 	 	57	 
	SECTION 3.2. Interest Provisions
	 	 	57	 
	3.2.1. Rates
	 	 	57	 
	3.2.2. Post-Maturity Rates
	 	 	58	 
	3.2.3. Payment Dates
	 	 	58	 
	SECTION 3.3. Fees
	 	 	59	 
	3.3.1. Commitment Fees
	 	 	59	 
	3.3.2. The Administrative Agent’s Fees
	 	 	59	 
	3.3.3. Letter of Credit Fees
	 	 	59	 
	ARTICLE IV CERTAIN LIBO RATE AND GUARANTY PROVISIONS
	 	 	60	 
	SECTION 4.1. LIBO Rate Lending Unlawful
	 	 	60	 
	SECTION 4.2. Deposits Unavailable
	 	 	60	 
	SECTION 4.3. Increased LIBO Rate Loan Costs, etc
	 	 	60	 
	SECTION 4.4. Funding Losses
	 	 	61	 
	SECTION 4.5. Increased Capital Costs
	 	 	61	 
	SECTION 4.6. Taxes
	 	 	62	 
	SECTION 4.7. Payments; Computations, etc
	 	 	66	 
	SECTION 4.8. Sharing of Payments
	 	 	66	 
	SECTION 4.9. Setoff
	 	 	67	 
	SECTION 4.10. Guaranty Provisions
	 	 	67	 
	4.10.1. Guaranty
	 	 	67	 
	4.10.2. Guaranty Absolute, etc
	 	 	67	 
	4.10.3. Reinstatement, etc
	 	 	68	 
	4.10.4. Waiver, etc
	 	 	68	 
	4.10.5. Postponement of Subrogation, etc
	 	 	68	 
	ARTICLE V CONDITIONS TO CREDIT EXTENSIONS
	 	 	69	 
	SECTION 5.1. Initial Credit Extension
	 	 	69	 
	5.1.1. Resolutions, etc
	 	 	69	 
	5.1.2. Intercreditor Agreement
	 	 	69	 

ii

 

	 	 	 	 	 
	Section	 	Page
	5.1.3. Closing Date Certificate
	 	 	69	 
	5.1.4. Delivery of Notes
	 	 	70	 
	5.1.5. Minimum Opening Liquidity Amount
	 	 	70	 
	5.1.6. Closing; Fees; Expenses, etc
	 	 	70	 
	5.1.7. Borrowing Base Certificate
	 	 	70	 
	5.1.8. Opinions of Counsel
	 	 	70	 
	5.1.9. U.C.C. and Other Searches
	 	 	70	 
	5.1.10. Pledge Agreements
	 	 	70	 
	5.1.11. Security Agreements, etc
	 	 	71	 
	5.1.12. Lien Terminations and Releases
	 	 	71	 
	5.1.13. Controlled Deposit Accounts
	 	 	71	 
	5.1.14. Perfection Certificate
	 	 	71	 
	5.1.15. Senior Secured Note Documents
	 	 	71	 
	5.1.16. Existing Senior Secured Notes
	 	 	71	 
	5.1.17. No Material Adverse Change
	 	 	72	 
	5.1.18. Required Consents and Approvals
	 	 	72	 
	5.1.19. Satisfactory Legal Form
	 	 	72	 
	SECTION 5.2. All Credit Extensions
	 	 	72	 
	5.2.1. Compliance With Warranties; No Default, etc
	 	 	72	 
	5.2.2. Credit Extension Request, etc
	 	 	72	 
	5.2.3. Borrowing Base Certificate
	 	 	73	 
	5.2.4. Payment of Fees
	 	 	73	 
	5.2.5. Satisfactory Legal Form
	 	 	73	 
	ARTICLE VI REPRESENTATIONS AND WARRANTIES
	 	 	73	 
	SECTION 6.1. Organization, etc
	 	 	73	 
	SECTION 6.2. Due Authorization, Non-Contravention, etc
	 	 	73	 
	SECTION 6.3. Government Approval; Regulation, etc
	 	 	74	 
	SECTION 6.4. Validity, etc
	 	 	74	 
	SECTION 6.5. Financial Information
	 	 	74	 
	SECTION 6.6. No Material Adverse Change
	 	 	74	 
	SECTION 6.7. Litigation; Labor Controversies, etc
	 	 	75	 
	SECTION 6.8. Subsidiaries
	 	 	75	 
	SECTION 6.9. Ownership of Properties
	 	 	75	 

iii

 

	 	 	 	 	 
	Section	 	Page
	SECTION 6.10. Taxes
	 	 	75	 
	SECTION 6.11. Pension Plans
	 	 	75	 
	SECTION 6.12. Environmental Warranties
	 	 	75	 
	SECTION 6.13. Accuracy of Information.
	 	 	77	 
	SECTION 6.14. Regulations U and X
	 	 	78	 
	SECTION 6.15. Solvency
	 	 	78	 
	SECTION 6.16. Intellectual Property Collateral
	 	 	78	 
	SECTION 6.17. Ownership of Stock
	 	 	78	 
	SECTION 6.18. Material Contracts
	 	 	79	 
	ARTICLE VII COVENANTS
	 	 	79	 
	SECTION 7.1. Affirmative Covenants
	 	 	79	 
	7.1.1. Financial Information; Reports; Notices, etc
	 	 	79	 
	7.1.2. Maintenance of Existence; Compliance With Laws, etc
	 	 	82	 
	7.1.3. Maintenance of Properties
	 	 	82	 
	7.1.4. Insurance
	 	 	82	 
	7.1.5. Books and Records
	 	 	83	 
	7.1.6. Post-Closing Requirements
	 	 	83	 
	7.1.7. Use of Proceeds
	 	 	83	 
	7.1.8. Borrowers; Security; etc
	 	 	83	 
	7.1.9. Controlled Deposit Accounts
	 	 	84	 
	7.1.10. Environmental Covenant
	 	 	84	 
	7.1.11. As to Intellectual Property Collateral
	 	 	84	 
	7.1.12. Designation of Restricted and Unrestricted Subsidiaries.
	 	 	85	 
	SECTION 7.2. Negative Covenants
	 	 	86	 
	7.2.1. Business Activities
	 	 	86	 
	7.2.2. Indebtedness
	 	 	87	 
	7.2.3. Liens
	 	 	89	 
	7.2.4. Investments
	 	 	91	 
	7.2.5. Restricted Payments, etc
	 	 	92	 
	7.2.6. Fixed Charge Coverage Ratio
	 	 	92	 
	7.2.7. No Prepayment of Senior Secured Notes
	 	 	92	 
	7.2.8. Capital Securities
	 	 	93	 
	7.2.9. Consolidation, Merger, etc
	 	 	93	 

iv

 

	 	 	 	 	 
	Section	 	Page
	7.2.10. Permitted Dispositions
	 	 	94	 
	7.2.11. Modification of Certain Agreements
	 	 	94	 
	7.2.12. Transactions With Affiliates
	 	 	94	 
	7.2.13. Restrictive Agreements, etc
	 	 	94	 
	7.2.14. Sale and Leaseback
	 	 	95	 
	7.2.15. Disposition of the Texas City Facility
	 	 	95	 
	7.2.16. Sale or Discount of Receivables
	 	 	95	 
	7.2.17. Unconditional Purchase Obligations
	 	 	95	 
	7.2.18. Controlled Deposit Accounts
	 	 	95	 
	7.2.19. Existing Senior Secured Notes
	 	 	96	 
	ARTICLE VIII EVENTS OF DEFAULT
	 	 	96	 
	SECTION 8.1. Listing of Events of Default
	 	 	96	 
	8.1.1. Non-Payment of Obligations
	 	 	96	 
	8.1.2. Breach of Warranty
	 	 	96	 
	8.1.3. Non-Performance of Certain Covenants and Obligations
	 	 	96	 
	8.1.4. Non-Performance of Other Covenants and Obligations
	 	 	97	 
	8.1.5. Default on Other Indebtedness
	 	 	97	 
	8.1.6. Judgments
	 	 	97	 
	8.1.7. Pension Plans
	 	 	97	 
	8.1.8. Change in Control
	 	 	98	 
	8.1.9. Bankruptcy, Insolvency, etc
	 	 	98	 
	8.1.10. Impairment of Security, etc
	 	 	99	 
	SECTION 8.2. Action if Event of Default
	 	 	99	 
	ARTICLE IX THE ADMINISTRATIVE AGENT
	 	 	99	 
	SECTION 9.1. Actions
	 	 	99	 
	SECTION 9.2. Funding Reliance, etc
	 	 	100	 
	SECTION 9.3. Exculpation
	 	 	100	 
	SECTION 9.4. Successor
	 	 	101	 
	SECTION 9.5. Credit Extensions by Administrative Agent and Issuer
	 	 	102	 
	SECTION 9.6. Credit Decisions
	 	 	102	 
	SECTION 9.7. Copies, etc
	 	 	102	 
	SECTION 9.8. Reliance by Administrative Agent
	 	 	102	 
	SECTION 9.9. Defaults
	 	 	103	 

v

 

	 	 	 	 	 
	Section	 	Page
	ARTICLE X MISCELLANEOUS PROVISIONS
	 	 	103	 
	SECTION 10.1. Waivers; Amendments, etc
	 	 	103	 
	SECTION 10.2. Notices; Time
	 	 	105	 
	SECTION 10.3. Payment of Costs and Expenses
	 	 	105	 
	SECTION 10.4. Indemnification
	 	 	106	 
	SECTION 10.5. Survival
	 	 	107	 
	SECTION 10.6. Severability
	 	 	108	 
	SECTION 10.7. Headings
	 	 	108	 
	SECTION 10.8. Execution in Counterparts; Effectiveness, etc
	 	 	108	 
	SECTION 10.9. Governing Law; Entire Agreement
	 	 	108	 
	SECTION 10.10. Successors and Assigns
	 	 	108	 
	SECTION 10.11. Sale and Transfer of Loans; Participations in Loans and Notes
	 	 	109	 
	10.11.1. Assignments
	 	 	109	 
	10.11.2. Participations
	 	 	110	 
	SECTION 10.12. Confidentiality
	 	 	111	 
	SECTION 10.13. Other Transactions
	 	 	112	 
	SECTION 10.14. Forum Selection and Consent to Jurisdiction
	 	 	112	 
	SECTION 10.15. Waiver of Jury Trial
	 	 	113	 
	SECTION 10.16. Certain Collateral Matters
	 	 	113	 
	SECTION 10.17. Interest
	 	 	114	 
	SECTION 10.18. Assignment of Existing Loans
	 	 	114	 
	SECTION 10.19. Restatement of Existing Credit Agreement
	 	 	115	 
	SECTION 10.20. Limited Consent
	 	 	115	 
	SECTION 10.21. Release of Collateral and Obligations
	 	 	116	 
	SECTION 10.22 Accounting Changes
	 	 	116	 
	SECTION 10.21. Documentation Agent
	 	 	117	 

SCHEDULE I — Disclosure Schedule

SCHEDULE II — Percentages; Addresses

SCHEDULE III — Account Debtor Schedule

SCHEDULE IV — Approved Depository Banks

SCHEDULE V — Existing Letters of Credit

SCHEDULE VI — Post-Closing Requirements

vi

 

	 	 	 	 	 
	EXHIBIT A-1

	 	-
	 	Form of Revolving Credit Note
	EXHIBIT A-2

	 	-
	 	Form of Swing Line Note
	EXHIBIT B-1

	 	-
	 	Form of Borrowing Request
	EXHIBIT B-2

	 	-
	 	Form of Issuance Request
	EXHIBIT C

	 	-
	 	Form of Continuation/Conversion Notice
	EXHIBIT D

	 	-
	 	Form of Closing Date Certificate
	EXHIBIT E

	 	-
	 	Form of Borrowing Base Certificate
	EXHIBIT F

	 	-
	 	Form of Pledge Agreement
	EXHIBIT G

	 	-
	 	Form of Security Agreement
	EXHIBIT H

	 	-
	 	Form of Joinder Agreement
	EXHIBIT I

	 	-
	 	Form of Intercreditor Agreement
	EXHIBIT J

	 	-
	 	Form of Lender Assignment Agreement
	EXHIBIT K

	 	-
	 	Form of Perfection Certificate
	EXHIBIT L

	 	-
	 	Form of Exemption Certificate

vii

 

AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT

     THIS AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT, dated as of March 29, 2007, among
STERLING CHEMICALS, INC., a Delaware corporation (the “Company”), STERLING CHEMICALS
ENERGY, INC., a Delaware corporation (“Energy”), and each other Person who becomes a party
hereto pursuant to Section 7.1.8 (each such Person, together with the Company and Energy,
each individually a “Borrower” and collectively, the “Borrowers”), the various financial
institutions as are or may become parties hereto from time to time (collectively, the
“Lenders”), THE CIT GROUP/BUSINESS CREDIT, INC. (“CIT”), as the administrative
agent (in such capacity, the “Administrative Agent”) for the Lenders and WACHOVIA BANK,
NATIONAL ASSOCIATION, as the documentation agent (in such capacity, the “Documentation
Agent”) for the Lenders.

R E C I T A L S:

     A. On December 19, 2002, the Borrowers, the Administrative Agent and the Lenders entered into
a Revolving Credit Agreement (the “Existing Credit Agreement”), pursuant to which, among other
things, the Lenders agreed to extend credit to the Borrowers on a revolving credit basis, in the
aggregate principal amount of up to One Hundred Million Dollars ($100,000,000), of which no loans
are outstanding on the Closing Date (as hereinafter defined).

     B. The Borrowers, the Administrative Agent, the Documentation Agent and the Lenders desire to
amend and restate the Existing Credit Agreement in its entirety to: (i) extend the maturity date
of the Revolving Credit Commitment (as hereinafter defined), (ii) decrease the Revolving Credit
Commitment Amount (as hereinafter defined) from One Hundred Million Dollars ($100,000,000) to Fifty
Million Dollars ($50,000,000), and (iii) make certain other changes to the Existing Credit
Agreement, all as more fully set forth herein, which amendment and restatement shall become
effective upon the Closing Date.

     C. It is the intent of the parties hereto that this Agreement (as hereinafter defined)
supersede and replace the Existing Credit Agreement in its entirety; provided that, (i)
such amendment and restatement shall operate to renew, amend and modify the rights and obligations
of the parties under the Existing Credit Agreement, as applicable and as provided herein, but shall
not effect a novation thereof, (ii) unless otherwise provided for herein and evidenced by a
separate written agreement, amendment or release, no other Loan Document, as defined in, and
executed and/or delivered pursuant to the terms of, the Existing Credit Agreement (collectively,
the “Existing Loan Documents”) shall be amended, terminated or released in any respect and all of
such other Existing Loan Documents shall remain in full force and effect except that the parties
hereto agree that by executing this Agreement the definition of “Credit Agreement” contained in
such Existing Loan Documents shall be amended to include this Agreement and all future amendments
hereto, and (c) the Liens securing the Obligations under and as defined in the Existing Credit
Agreement and granted pursuant to the Existing Loan Documents and the liabilities and obligations
of the Borrowers shall not be extinguished, but shall be carried forward, and such Liens shall
secure such Obligations, in each case, as renewed, amended, restated and modified hereby.

1

 

     D. The parties hereto intend to amend and restate the Existing Credit Agreement, all as more
fully set forth herein, subject to and in reliance upon, the terms, conditions, representations and
warranties contained herein.

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

     SECTION 1.1. Defined Terms. The following terms (whether or not underscored) when
used in this Agreement, including its preamble and recitals, shall, except where the context
otherwise requires, have the following meanings (such meanings to be equally applicable to the
singular and plural forms thereof):

     “Acceptable Account” means any Foreign Account for which the Account Debtor has
long-term debt ratings, or is a Wholly-Owned Subsidiary of a Person having long-term debt ratings,
of at least A- and A3 or short-term debt ratings of at least A2 and P2, in each case by S&P and
Moody’s, respectively.

     “Account” means all of each Borrower’s now existing and future: (a) accounts (which
shall mean any “account” as such term is defined in Section 9-102 of the U.C.C.), and any and all
other receivables, including all accounts created by, or arising from, all sales, leases, rentals
of goods or renditions of services of the Borrowers to their customers, including but not limited
to, those accounts arising under any trade names or styles of the Borrowers, or through any
division of any Borrower; (b) “instruments”, “documents”, “chattel paper” (including electronic
chattel paper) (as each of those terms are defined in Section 9-102 of the U.C.C.); (c) unpaid
seller’s or lessor’s rights (including rescission, replevin, reclamation, repossession and stoppage
in transit) relating to the foregoing or arising therefrom; (d) rights to any goods represented by
any of the foregoing, including rights to returned, reclaimed or repossessed goods; (e) reserves
and credit balances arising in connection with or pursuant thereto; (f) guarantees, supporting
obligations, “payment intangibles” and “letter-of-credit rights” (as “payment intangibles” and
letter-of-credit rights” are defined in Section 9-102 of the U.C.C.); (g) insurance policies or
rights relating to any of the foregoing; (h) “general intangibles” (as that term is defined in
Section 9-102 of the U.C.C.) pertaining to any and all of the foregoing (including all rights to
payment, including those arising in connection with bank and non-bank credit cards), and including
books and “records” (as that term is defined in Section 9-102 of the U.C.C.) and any electronic
media and software thereto; (i) notes, deposits or property of Account Debtors securing the
obligations of any such Account Debtors to any Borrower; and (j) cash and non-cash “proceeds” (as
defined in Section 9-102 of the U.C.C.) of any and all of the foregoing.

     “Account Debtor” means any Person obligated on any Account of any Borrower.

     “Account Debtor Schedule” means the Account Debtor Schedule attached hereto as
Schedule III, as it may be supplemented or otherwise modified from time to time by the
Borrowers upon the written consent of the Administrative Agent and provided that any Account Debtor
added to the Account Debtor Schedule meets all of the requirements set forth in the definition of
“Acceptable Account.”

2

 

     “Adjustment Date” means, for purposes of the Applicable Margin, the date two Business
Days after receipt by the Administrative Agent of the monthly Borrowing Base Certificate required
pursuant to Section 7.1.1(c).

     “Administrative Agent” is defined in the Introductory Statement and includes each
other Person appointed as the successor Administrative Agent pursuant to Section 9.4.

     “Affiliate” of any Person means any other Person which, directly or indirectly,
controls, is controlled by or is under common control with such Person. As used in this definition
“control” of a Person means:

     (a) the power, directly or indirectly, to vote 10% or more of the Capital Securities
(on a fully diluted basis) having ordinary voting power for the election of directors,
managing members or general partners (as applicable);

     (b) beneficial ownership of 10% or more of any class of the Voting Stock of such Person
or 10% or more of all outstanding Capital Securities of such Person; or

     (c) the power, directly or indirectly, to direct or cause the direction of the
management and policies of such Person (whether by contract or otherwise).

     “Agreement” means, on any date, this Amended and Restated Revolving Credit Agreement
as originally in effect on the Closing Date and as thereafter from time to time amended,
supplemented, amended and restated or otherwise modified from time to time and in effect on such
date.

     “Alternate Base Rate” means, for any day and with respect to all Base Rate Loans, the
higher of (a) 0.50% per annum above the latest Federal Funds Rate and (b) the rate of interest in
effect for such day as most recently publicly announced or established by JPMorgan Chase Bank, N.A.
in New York, New York (the “Reference Bank”), as its “Base Rate”. (The “Base Rate” is a rate set by
the Reference Bank based upon various factors including the Reference Bank’s costs and desired
return, general economic conditions and other factors, and is used as a reference point for pricing
some loans, which may be priced at, above or below such announced rate.) Any change in the
Alternate Base Rate established or announced by the Reference Bank shall take effect at the opening
of business on the day of such establishment or announcement.

     “Applicable Margin” means, for any day, with respect to any Base Rate Loans or LIBO
Rate Loans, as the case may be, the applicable rate per annum set forth below under the caption
“Base Rate Spread” or “LIBO Spread”, as the case may be:

3

 

	 	 	 	 	 	 	 	 	 	 	 
	Pricing	 	 	 	LIBO	 	Base Rate
	Level	 	Excess Availability	 	Spread	 	Spread
	1

	 	Greater than $40,000,000
	 	 	1.50	%	 	 	0.00	%
	2

	 	Greater than $30,000,000, but less than
or equal to $40,000,000
	 	 	1.75	%	 	 	0.00	%
	3

	 	Greater than $20,000,000, but less than
or equal to $30,000,000
	 	 	2.00	%	 	 	0.25	%
	4

	 	Less than or equal to $20,000,000
	 	 	2.25	%	 	 	0.50	%

     The Applicable Margin shall be adjusted on each Adjustment Date based upon the Administrative
Agent’s determination of the Excess Availability based upon the information provided in the
Borrowing Base Certificate most recently delivered to the Administrative Agent pursuant to
Section 7.1.1(c). If the Borrowing Base Certificate required pursuant to Section
7.1.1(c) is not received by the Administrative Agent by the date required, the Applicable
Margin shall be determined using Pricing Level 4 until such time as such Borrowing Base Certificate
is received. Notwithstanding the foregoing, the Applicable Margin in effect from and after the
Closing Date through the date on which another Pricing Level would otherwise be in effect based on
the Excess Availability as shown on the Borrowing Base Certificate next delivered to the
Administrative Agent shall be Pricing Level 1. Without limitation of any other provision of this
Agreement or any other remedy available to the Administrative Agent or the Lenders under any of the
Loan Documents, to the extent that any information contained in any Borrowing Base Certificate
delivered pursuant to Section 7.1.1(c) shall be incorrect in any manner, the Administrative
Agent may recalculate the Applicable Margin based upon such corrected information, and, upon
written notice thereof to the Borrowers, the Loans shall bear interest based upon such recalculated
Applicable Margin retroactively from the date of delivery of the erroneous Borrowing Base
Certificate or other erroneous information in question until the date of delivery of the correct
Borrowing Base Certificate delivered by the Borrowers to the Administrative Agent.

     “Application” means an “Application and Agreement for Letters of Credit” or similar
instruments or agreements, entered into between any Borrower and an Issuer in connection with any
Letter of Credit.

     “Approved Depository Bank” means any financial institution described on Schedule IV
hereto and any other financial institution which the Administrative Agent may hereafter designate
as an “Approved Depository Bank” by written notice to the Company; provided, that, the
Administrative Agent may, in its reasonable discretion, notify the Company that a financial
institution which was an “Approved Depository Bank” no longer qualifies as such for purposes of
this Agreement, in which event such financial institution shall not be considered an “Approved
Depository Bank” for purposes of the Loan Documents from and after the date specified in such
notice.

     “Asset Sale Offer” means “Asset Sale Offer” as that term is defined in the Indenture.

4

 

     “Assignee Lender” is defined in Section 10.11.1.

     “Assignor Lender” is defined in Section 10.11.1.

     “Authorized Officer” is defined in clause of Section 5.1.1.

     “Availability Reserve” means the sum of (without duplication), at the Administrative
Agent’s election, reserves: (a) for any matters affecting the priority of the Liens securing the
Obligations, including (i) rental payments or similar charges for any Borrower’s leased premises or
other locations where Collateral is located or deemed to be located and for which the Borrowers
have not delivered to the Administrative Agent a landlord’s waiver or mortgagee’s waiver or other
similar subordination agreement, as applicable, all in form and substance reasonably satisfactory
to the Administrative Agent, and (ii) estimated payments due by the Borrowers to any applicable
warehousemen or third party processor, for which the Borrowers have not delivered to the
Administrative Agent a waiver or some other similar subordination agreement as determined by and in
form and substance reasonably satisfactory to the Administrative Agent; provided, that any
of the foregoing amounts shall be adjusted from time to time hereafter upon (A) delivery to the
Administrative Agent of any such acceptable waiver or subordination agreement, (B) the opening or
closing of a location where Collateral is located or deemed to be located for which the Borrowers
have not delivered such an acceptable waiver or subordination agreement, and/or (C) any change in
the amount of rental, storage or processor payments or similar charges; plus (b) for any
amounts as otherwise provided pursuant to the explicit terms of this Agreement; plus (c) as
the Administrative Agent may require from time to time in the reasonable judgment of the
Administrative Agent.

     “Backed By Credit Support” means an Account (a) that is backed by a letter of credit
(payable in Dollars) in form and substance reasonably acceptable to the Administrative Agent and
that is issued or confirmed by an issuer having ratings of at least A2 or P2 by S&P and Moody’s,
respectively, or a rating of at least A2 by International Bank Credit Analysis, Ltd. or at least
LC-1 by Thomson Bank Watch, (b) for which a guaranty agreement guaranteeing the payment of such
Account has been executed by a U.S. corporation that is an Affiliate of the Account Debtor both in
form and substance and from a U.S. corporation reasonably satisfactory to the Administrative Agent
or (c) that is insured by credit insurance in form, substance and amount, and by an insurer,
reasonably satisfactory to the Administrative Agent.

     “Banking Services” means each and any of the following bank services provided to any
Borrower by any Lender or any of its Affiliates: (a) commercial credit cards, (b) stored value
cards, (c) treasury management services (including controlled disbursement, automated clearinghouse
transactions, return items, overdrafts and interstate depository network services) and (d) risk
management services (including insurance, premium finance and similar products).

     “Banking Services Obligations” of the Borrowers means any and all obligations of the
Borrowers, whether absolute or contingent and howsoever and whensoever created, arising, evidenced
or acquired (including all renewals, extensions and modifications thereof and substitutions
therefor) in connection with Banking Services.

     “Base Rate” is defined in the definition of Alternate Base Rate.

5

 

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

     “Borrower” and “Borrowers” are as defined in the Introductory Statement.

     “Borrowing” means a borrowing of Loans of the same Type and, in the case of LIBO Rate
Loans, having the same Interest Period, made by all Lenders required to make such Loans on the same
Business Day and pursuant to the same Borrowing Request in accordance with Section 2.1 or a
continuation or conversion thereof pursuant to Section 2.4.

     “Borrowing Base Amount” means, at any time, an amount equal to the sum of (without
duplication) (a) 85% of Eligible Accounts (other than the BP Accounts), provided that the
Administrative Agent may, in its sole discretion, lower such advance percentage on Eligible
Accounts to the extent that the Dilution Percentage exceeds five percent (5%) calculated on a
rolling ninety (90) day period; plus (b) 65% of Eligible Inventory; plus (c) the
lesser of (i) 70% of the BP Accounts and (ii) $20,000,000. The Administrative Agent shall have the
right to review computations of the Borrowing Base Amount and if, in its reasonable judgment, such
computations have not been computed in accordance with the terms of this Agreement, the
Administrative Agent shall have the right to correct such errors.

     “Borrowing Base Certificate” means a certificate duly completed and executed by the
treasurer, assistant treasurer, chief accounting or financial Authorized Officer of the Company,
substantially in the form of Exhibit F hereto, together with such changes thereto as the
Administrative Agent may from time to time reasonably request for the purpose of monitoring the
Borrowers’ compliance with the limitations on the amount of Loans that may be outstanding at any
time hereunder.

     “Borrowing Request” means a Loan request and certificate duly executed by an
Authorized Officer of the applicable Borrower, substantially in the form of Exhibit B-1
hereto.

     “BP” means BP Amoco Chemical Company, a Delaware corporation.

     “BP Accounts” means any and all Accounts of any Borrower now existing or arising in
the future with respect to the BP Production Agreement, including all rights of any Borrower to
payment thereunder.

     “BP Production Agreement” means the Second Amended and Restated Production Agreement,
dated as of August 1, 1996, between BP and the Company, as amended, supplemented, amended and
restated or otherwise modified from time to time.

     “Business Day” means:

     (a) any day which is neither a Saturday or Sunday nor a legal holiday on which banks
are authorized or required to be closed in New York, New York; and

     (b) relative to the making, continuing, prepaying or repaying of any LIBO Rate Loans,
any day which is a Business Day described in clause (a) above and which is

6

 

also a day on which dealings in Dollars are carried on in the London interbank
eurodollar market.

     “Capital Expenditures” means, for any period, the aggregate amount of all expenditures
of the Borrowers for fixed or capital assets made during such period which, in accordance with
GAAP, would be classified as capital expenditures.

     “Capital Securities” means, with respect to any Person, any and all shares, interests,
participations or other equivalents (however designated, whether voting or non-voting) of such
Person’s equity (including any instruments convertible into equity), whether now outstanding or
issued after the Closing Date.

     “Capitalized Lease Liabilities” means all monetary obligations of the Borrowers under
any leasing or similar arrangement which have been (or, in accordance with GAAP, should be)
classified as capitalized leases, and for purposes of each Loan Document, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance with GAAP, and the
stated maturity thereof shall be the date of the last payment of rent or any other amount due under
such lease prior to the first date upon which such lease may be terminated by the lessee without
payment of a premium or a penalty.

     “Cash Collateralize” means, with respect to a Letter of Credit, the deposit of
immediately available funds into a cash collateral account maintained with (or on behalf of) the
Administrative Agent, on terms and conditions satisfactory to the Administrative Agent, in an
amount equal to the Stated Amount of such Letter of Credit.

     “Cash Equivalent Investment” means, at any time:

     (a) any direct obligation of (or unconditionally guaranteed by) the United States or a
State (or any agency or political subdivision thereof, to the extent such obligations are
supported by the full faith and credit of the United States or a State) maturing not more
than one year after such time;

     (b) commercial paper maturing not more than 270 days from the date of issue, which is
issued by

     (i) a corporation (other than an Affiliate of any Borrower or any Subsidiary of
any Borrower) organized under the laws of any State and rated A-1 or higher by S&P
or P-1 or higher by Moody’s, or

     (ii) any Lender (or its holding company);

     (c) any certificate of deposit, time deposit or bankers acceptance, maturing not more
than one year after its date of issuance, which is issued by either

     (i) any bank organized under the laws of the United States (or any State) and
which has (x) a credit rating of P-1 or higher from Moody’s or A-1 or higher from
S&P and (y) a combined capital and surplus greater than $500,000,000, or

7

 

     (ii) any Lender;

     (d) any repurchase agreement having a term of 30 days or less entered into with any
Lender or any commercial banking institution satisfying the criteria set forth in clause
(c)(i) which

     (i) is secured by a fully perfected security interest in any obligation of the
type described in clause (a), and

     (ii) has a market value at the time such repurchase agreement is entered into
of not less than 100% of the repurchase obligation of such commercial banking
institution thereunder;

     (e) any money market mutual fund with a daily right of redemption and a net asset value
of $1.00 per share substantially all the assets of which are comprised of investments of the
types described in the preceding clauses (a) through (d); or

     (f) participations in loans (for a tenor of not more than 90 days) to Persons having
short term credit ratings of at least A-1 and P-1 by S&P and Moody’s, respectively.

     “CERCLA” means the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended.

     “CERCLIS” means the Comprehensive Environmental Response Compensation Liability
Information System List.

     “Change in Control” means:

     (a) a “Change of Control”, as defined in the Indenture;

     (b) a change resulting when (i) any Unrelated Person or any Unrelated Persons, other
than the holders on the Closing Date of the Company’s Series A Convertible Preferred Stock
and the designated shareholders listed on Item 1.1 of the Disclosure Schedule
(“Designated Shareholders”), acting together, which would constitute a Group (as
defined in Section 13(d) of the Exchange Act) together with any Affiliates or Related
Persons thereof (in each case also constituting Unrelated Persons) shall at any time either
(x) Beneficially Own (as defined in Rule 13d-3 of the Exchange Act) more than 40% of the
aggregate voting power of all classes of Voting Stock of the Company or (y) succeed in
having a sufficient number of its or their nominees elected to the Board of Directors of the
Company such that such nominees, when added to any existing director remaining on the Board
of Directors of the Company after such election who is an Affiliate or Related Person of
such Person or Group (as defined in Section 13(d) of the Exchange Act), shall constitute a
majority of the Board of Directors of the Company or (ii) the Designated Shareholders shall
cease to own 40% or more of all classes of Voting Stock of the Company. As used herein (A)
“Unrelated Person” shall mean at any time any Person other than the Company or any
of its Subsidiaries and other than any trust for any employee benefit plan of the Company or
any of its Subsidiaries

8

 

and (B) “Related Person” of any Person shall mean any other Person owning (1)
5% or more of the outstanding common stock of such Person or (2) 5% or more of the Voting
Stock of such Person; or

     (c) during any period of two consecutive years, individuals who at the beginning of
such period constituted the Board of Directors of the Company (together with any new
directors elected by the holders of the Company’s Series A Convertible Preferred Stock or
whose election by such Board of Directors or whose nomination for election by the
shareholders of the Company, as the case may be, was approved by a majority of the directors
of the Company, as the case may be, then still in office who were either directors at the
beginning of such period or whose election or nomination for election was previously so
approved), cease for any reason to constitute a majority of the Board of Directors of the
Company, as the case may be, then in office.

     “CIT” is defined in the Introductory Statement.

     “Closing Date” means the date all of the conditions precedent set forth in Article V
have been satisfied and the initial Credit Extensions are made.

     “Closing Date Certificate” means the closing date certificate executed and delivered
by each Borrower pursuant to the terms of this Agreement, substantially in the form of Exhibit D
hereto.

     “Code” means the Internal Revenue Code of 1986, and the regulations thereunder, in
each case as amended, reformed or otherwise modified from time to time.

     “Collateral” means (a) the Capital Securities of each now existing or hereafter
created or acquired Borrower (other than the Company) or Restricted Subsidiary (other than any
Foreign Subsidiary) and (b) any and all other assets of the Borrowers of the type or types
described in and subject to the Liens, privileges, priorities and security interests purported to
be created by any Security Document.

     “Commitment” means, as the context may require, the then applicable Revolving Credit
Commitment, Letter of Credit Commitment and/or Swing Line Loan Commitment.

     “Commitment Amount” means, as the context may require, the Revolving Credit Commitment
Amount, the Letter of Credit Commitment Amount and/or the Swing Line Loan Commitment Amount.

     “Commitment Fee” is defined in Section 3.3.1.

     “Commitment Termination Date” means the earliest of (a) the Maturity Date; (b) the
date on which any of the Commitment Amounts are terminated in full or permanently reduced to zero
pursuant to the terms of this Agreement (including Section 2.2); and (c) the date on which
any Commitment Termination Event occurs. Upon the occurrence of any event described in the
preceding clauses, all of the Commitments shall terminate automatically and without any further
action.

9

 

     “Commitment Termination Event” means the occurrence and continuance of any Event of
Default in respect of which all or any portion of the Loans are accelerated or otherwise declared
to be due and payable or the Commitments are terminated, in each case pursuant to Section 8.2.

     “Commodity Hedging Agreements” means with respect to any Person, all liabilities of
such Person under exchange agreements, swap agreements, cap agreements, future agreements, forward
agreements and all other agreements or arrangements (of a strictly non-speculative nature) designed
to protect such Person against fluctuations in commodity prices.

     “Company” is defined in the Introductory Statement.

     “Concentration Account” is defined in clause (a) of Section 3.1.3.

     “Condemnation Proceeds” means all awards, proceeds or payments received by any
Borrower or any Restricted Subsidiary relating to the condemnation of any Properties of any
Borrower or any Restricted Subsidiary.

     “Contingent Liability” means any agreement, undertaking or arrangement by which any
Person guarantees, endorses or otherwise becomes or is contingently liable upon (by direct or
indirect agreement, contingent or otherwise, to provide funds for payment, to supply funds to, or
otherwise to invest in, a debtor, or otherwise, to assure a creditor against loss) the Indebtedness
of any other Person, or guarantees the payment of dividends or other distributions upon the Capital
Securities of any other Person; provided, however, that the term “Contingent
Liability” shall not include endorsements for collection or deposits in the ordinary course of
the Borrowers’ businesses. The amount of any Person’s obligation under any Contingent Liability
shall (subject to any limitation set forth therein) be deemed to be the outstanding principal
amount of the debt, obligation or other liability guaranteed thereby.

     “Continuation/Conversion Notice” means a notice of continuation or conversion and
certificate duly executed by an Authorized Officer of the applicable Borrower (or the Company on
behalf of such Borrower), substantially in the form of Exhibit C hereto.

     “Control Agreements” means the deposit account agreements, blocked account agreements,
restricted account agreements, lockbox agreements or similar agreements, executed by and among the
Borrowers, the Administrative Agent and the Approved Depository Banks at which the Controlled
Deposit Accounts are being maintained, as required pursuant to Section 3.1.3 or at which
any other deposit account of the Borrowers or any of their Restricted Subsidiaries are being
maintained in accordance with Section 7.2.18 or any other Loan Document, each granting the
Administrative Agent, on behalf of the Secured Parties, “control” (as such term is defined in
Section 9-104 of the U.C.C.) over such Controlled Deposit Account or other deposit account, and
each such agreement to be reasonably satisfactory to the Administrative Agent, as such agreements
may be amended, supplemented, amended and restated or otherwise modified from time to time.

     “Controlled Deposit Account” is defined in clause (a) of Section 3.1.3.

10

 

     “Controlled Group” means all members of a controlled group of corporations and all
members of a controlled group of trades or businesses (whether or not incorporated) under common
control which, together with the Company or any Subsidiary, are treated as a single employer under
Section 414 of the Code or Section 4001 of ERISA.

     “Credit Extension” means, as the context may require, (a) the making of any Loan
(including the Loans to be made pursuant to clause (c) of Section 2.3.1) by a
Lender; or (b) the issuance of any Letter of Credit (including the deemed issuance of any Letter of
Credit pursuant to clause (c) of Section 2.3.1), or the extension of any Stated
Expiry Date of any existing Letter of Credit or the increase in the Stated Amount of any existing
Letter of Credit, in each case by the Issuer.

     “Default” means any Event of Default or any condition, occurrence or event which,
after notice or lapse of time or both, would constitute an Event of Default.

     “Dilution” shall mean a reduction as reasonably determined by the Administrative Agent
in the value of Accounts of the Borrowers caused by write-offs, returns, allowances, discounts,
credits, and/or any other offsets asserted by customers having the effect of reducing the
collections of Accounts.

     “Dilution Percentage” shall mean, with respect to the Borrowers, the ratio of Dilution
to the total Accounts of the Borrowers.

     “Disbursement” is defined in Section 2.6.2.

     “Disbursement Date” is defined in Section 2.6.2.

     “Disclosure Schedule” means the Disclosure Schedule attached hereto as Schedule
I, as it may be amended, supplemented, amended and restated or otherwise modified from time to
time by the Borrowers with the prior written consent of the Required Lenders.

     “Disposition” (or similar words such as “Dispose”) means any sale, transfer,
lease, contribution or other conveyance (including by way of condemnation or merger) of, or the
granting of options, warrants or other rights to, any Properties of the Borrowers or any Restricted
Subsidiaries of the Borrowers, including Accounts and Capital Securities, to any other Person in a
single transaction or series of transactions.

     “Documentation Agent” means Wachovia Bank, National Association, in its capacity as
documentation agent under the Loan Documents, together with its successors and assigns in such
capacity.

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

     “EBITDA” shall mean, for any period and without duplication, (a) all earnings of the
Borrowers and their Restricted Subsidiaries before all (i) interest and income tax expense, (ii)
depreciation, and (iii) amortization, in each case for such period, all determined in accordance
with GAAP on a basis consistent with the latest audited financial statements of the Company, but in
all cases excluding (A) the effect of any non-cash extraordinary or non-recurring gains or

11

 

losses for such period and (B) the earnings of any Person (including any Unrestricted
Subsidiary) that is not a Restricted Subsidiary of the Company, unless such earnings were
distributed in cash to a Borrower, plus (b) to the extent deducted in determining EBITDA,
the amount of any expenses incurred during such period by the Borrowers and its Restricted
Subsidiaries for liabilities, casualties and business interruption that have been reimbursed in
cash during such period under the insurance policies maintained by the Borrowers and their
Restricted Subsidiaries.

     “Eligible Account” means, at any time, the invoice or ledger amount owing on each
Account of any Borrower, in each case, net of any reserves reasonably required by the
Administrative Agent from time to time in accordance with the Administrative Agent’s customary
practice, for which each of the following statements is accurate and complete to the reasonable
satisfaction of the Administrative Agent (and the Borrowers, by including an Account in any
computation of the Borrowing Base Amount, shall be deemed to represent and warrant to the
Administrative Agent, each Issuer and each Lender the accuracy and completeness of such
statements):

     (a) such Account is a binding and valid obligation of the Account Debtor thereof and is
in full force and effect and such Account Debtor is not an Affiliate of any Borrower (other
than BP or any of its Affiliates);

     (b) such Account is bona fide and to the extent such Account relates to any receivable
arising out of the profit sharing component of conversion or production contracts or cost
reimbursement obligations or any other obligation to pay money under a Material Contract or
other contract, there is no dispute as to the amount of such Account; provided,
however, that if the parties thereto disagree as to the amount of such Account, such
Account shall constitute an Eligible Account in an amount equal to the lowest amount of such
Account any party thereto believes to be owing thereunder;

     (c) payment of such Account (other than the BP Accounts) is less than 30 days past due
or, with respect to any BP Account, is no more than two days past due, as determined by the
due date stated on the invoice therefor (or if such Account is not paid by reference to any
invoice in the ordinary course of business but instead by reference to the terms of the
agreements creating such Account, such Account (other than the BP Accounts) has not remained
unpaid beyond 30 days after the due date therefor or, with respect to any BP Account, beyond
two days after the due date therefor));

     (d) such Account is not subject to any dispute, setoff (excluding any account payable
setoff supported by a letter of credit but including (i) any Exchange Inventory Payable and
(ii) any accounts payable amounts owing by any of the Borrowers to the third party which
owes an Exchange Inventory Receivable to such Borrower), counterclaim or other claim or
defense including rescission, cancellation or avoidance, whether by operation of law or
otherwise, on the part of the Account Debtor or any other Person denying liability under
such Account; provided, however, that any such Account shall constitute an
Eligible Account to the extent it is not subject to any such dispute, setoff, counterclaim
or other claim or defense;

12

 

     (e) the Administrative Agent, on behalf of the Lenders, has a first priority, perfected
Lien covering such Account and, such Account is, and at all times will be, free and clear of
all other Liens (other than inchoate Liens permitted under Section 7.2.3);

     (f) such Account arose in the ordinary course of business of any of the Borrowers and
such Borrower is the legal owner of such Account;

     (g) such Account is not payable by an Account Debtor who is more than 30 days past due
with regard to 20% or more of the total Accounts owed to the Borrowers by such Account
Debtor or any of its Affiliates;

     (h) all consents, licenses, approvals or authorizations of, or registrations or
declarations with, any Governmental Authority required to be obtained, effected or given in
connection with the execution, delivery and performance of such Account by each party
obligated thereunder have been duly obtained, effected or given and are in full force and
effect;

     (i) such Account is not an Account as to which any United States federal or State
Governmental Authority is the Account Debtor, except to the extent the applicable Borrower
has complied with the Assignment of Claims Act of 1940, as amended (31 U.S.C. § 3727; 41
U.S.C. § 15), by delivering to the Administrative Agent a notice of assignment in favor of
the Administrative Agent under such Act and in compliance with applicable provisions of 31
C.F.R. § 7-103.8 and 41 C.F.R. § 1-30.7, or with similar State law;

     (j) the Account Debtor on such Account is not the subject of any bankruptcy or
insolvency proceeding, has not had a trustee or receiver appointed for all or a substantial
part of its property, has not made an assignment for the benefit of creditors, nor admitted
its inability to pay its debts as they mature or suspended its business;

     (k) with respect to any Foreign Account, such Account is (without duplication), (i) a
Foreign Account which is Backed By Credit Support, (ii) an Acceptable Account that is listed
in the Account Debtor Schedule, provided, however, that any such Acceptable
Account shall be included in Eligible Accounts up to an aggregate amount not to exceed, at
any time, 10% of the total balance due on all Accounts, (iii) a Foreign Account which is not
Backed By Credit Support, provided, however, that any such Foreign Account
which is not Backed By Credit Support shall be included in Eligible Accounts up to an
aggregate amount not to exceed, at any time, 5% of the total balance due on all Accounts, or
(iv) the Account Debtor has previously been approved in writing by Required Lenders as an
eligible foreign Account Debtor for purposes of this Agreement;

     (l) in the case of the sale of goods, such goods have been sold to an obligor on a true
sale basis or open account, or subject to contract, and not on consignment, on approval or
on a “sale or return” basis or subject to any other repurchase or return agreement (other
than for failure to meet specifications), no material part of such goods has been returned,
rejected, lost or damaged, and such Account is not evidenced by

13

 

chattel paper or an instrument of any kind which has not been endorsed and delivered to
the Administrative Agent;

     (m) each of the representations and warranties set forth in each Security Agreement
with respect to such Account is true and correct in all material respects on such date; and

     (n) such Account has such other characteristics or criteria as the Administrative
Agent, in its reasonable discretion may specify from time to time in accordance with the
Administrative Agent’s customary practice;

provided that, notwithstanding anything to the contrary contained herein (i) if any
Eligible Account owed by an Account Debtor that does not have an Investment Grade Rating, when
added to all other Accounts that are obligations of the same Account Debtor and its Affiliates,
results in a total sum that exceeds 20% of the total balance then due on all Eligible Accounts
(without giving effect to any reduction in Eligible Accounts pursuant to this clause), the amount
of such Account in excess of 20% of such total balance then due shall be excluded from Eligible
Accounts and (ii) with respect to any and all Accounts (other than the BP Accounts) which meet the
above qualifications for an “Eligible Account” but (A) constitute a right to payment to any
Borrower for any goods that have been shipped, or services that have been provided to, the
purchaser thereof, but for which such purchaser has not yet been billed for payment or (B) are
Accounts of the type described in clause (b) of this definition of “Eligible Account”, then
the amount of all such Accounts described in this clause (ii) which exceed $3,000,000 in
aggregate at any time outstanding shall be excluded from Eligible Accounts.

     “Eligible Assignee” is defined in clause (a) of Section 10.11.1.

     “Eligible Inventory” means, at any time, all inventory of the Borrowers, including
Exchange Inventory Receivables, net of any reserves reasonably required by the Administrative Agent
from time to time in accordance with the Administrative Agent’s customary practice and, with
respect to any inventory acquired by any Borrower from BP, net of any accounts payable amounts
owing by any Borrower to BP; provided that such amounts do not duplicate those included in
clause (d) of the definition of “Eligible Accounts”, for which each of the following
statements is accurate and complete to the reasonable satisfaction of the Administrative Agent and
which at all times continue to be acceptable to the Administrative Agent in the exercise of its
reasonable judgment (and the Borrowers, by including such inventory in any computation of the
Borrowing Base Amount, shall be deemed to represent and warrant to the Administrative Agent, each
Issuer and each Lender, the accuracy and completeness of such statements):

     (a) such inventory shall be valued at the lower of cost or market in accordance with
GAAP and (i) shall include raw materials and finished goods but (ii) shall not include goods
that are classified as “work-in-progress”, “parts and supplies” or “stores inventories;”

     (b) such inventory is in good condition, meets all standards imposed by any
Governmental Authority having regulatory authority over it, its use and/or sale and is

14

 

either currently usable, undamaged or currently salable in the normal course of
business of the Borrowers;

     (c) such inventory (i) is an Exchange Inventory Receivable, (ii) is in the possession
of the Borrowers, (iii) is in transit in the ordinary course of business but in respect of
which title remains in the Borrowers and which is fully insured (subject to deductibles
consistent with prudent industry standards for similarly situated companies) and is not
located outside the United States or (iv) is in the possession or control of any
warehouseman, bailee or any agent or processor for or customer of the Borrowers and is not
located outside the United States, provided that, Borrowers shall have notified (in
a manner that effectively under applicable law creates a valid and first-priority, perfected
Lien in favor of the Administrative Agent, on behalf of the Lenders, in such inventory) such
warehouseman, bailee, agent, processor or customer of the Lien of the Secured Parties and
such warehouseman, bailee, agent, processor or customer has subordinated or waived any Lien
it may claim therein and agreed to hold all such inventory for the Secured Parties’ account
subject to the Administrative Agent’s instructions;

     (d) each of the representations and warranties set forth in the applicable Security
Agreement with respect to such inventory is true and correct in all material respects on
such date;

     (e) the Administrative Agent, on behalf of the Lenders, has a first-priority, perfected
Lien covering such inventory, and such inventory is, and at all time will be, free and clear
of all other Liens (other than inchoate Liens permitted under Section 7.2.3 or with
respect to which all rights of the holder of such Liens have been waived or subordinated to
the satisfaction of the Administrative Agent);

     (f) such inventory does not include goods that are not owned by the Borrowers or that
are held by the Borrowers pursuant to any consignment agreement;

     (g) to the extent inventory includes any Exchange Inventory Receivable (i) such
Exchange Inventory Receivable shall be reduced by any accounts payable amounts owing by any
of the Borrowers to the third party which owes such Exchange Inventory Receivable to such
Borrower and (ii) any such accounts payable amount shall be applied first to clause (d)(ii)
of the definition of Eligible Account and second to clause (g)(i) above, without
duplication); and

     (h) such inventory has such other characteristics or criteria as the Administrative
Agent, in its reasonable discretion, may specify from time to time in accordance with the
Administrative Agent’s customary practice.

     “Energy” is defined in the Introductory Statement.

     “Environmental Laws” means all applicable federal, state or local statutes, laws,
ordinances, codes, rules, regulations and guidelines (including consent decrees and administrative
orders) relating to public health and safety and protection of the environment.

15

 

     “equipment” means all “equipment” as such term is defined in Section 9-102 of the
U.C.C.

     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and any
successor statute thereto of similar import, together with the regulations thereunder, in each case
as in effect from time to time. References to Sections of ERISA also refer to any successor
Sections thereto.

     “ESOP” means any employee stock ownership plan established by one or more of the
Borrowers.

     “Event of Default” is defined in Section 8.1.

     “Event of Loss Offer” means “Event of Loss Offer” as that term is defined in the
Indenture.

     “Excess Availability” means, at any time of determination, the amount by which the
Maximum Loan Amount exceeds the aggregate outstanding principal amount of all Revolving Credit
Loans and Swing Line Loans, together with the aggregate amount of all Letter of Credit
Outstandings.

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

     “Exchange Inventory” means any inventory which is subject to a swap, exchange or
similar agreement or arrangement between any of the Borrowers and any other Person which is not an
Affiliate of a Borrower.

     “Exchange Inventory Payable” means the net amount of Exchange Inventory owing by any
of the Borrowers to any other Person which is not an Affiliate of a Borrower.

     “Exchange Inventory Receivable” means the net amount of Exchange Inventory owed to any
Borrower by any other Person which is not an Affiliate of a Borrower.

     “Exemption Certificate” is defined in clause (e) of Section 4.6.

     “Existing Credit Agreement” is defined in Recital A.

     “Existing Indenture” means the Indenture, dated as of December 19, 2002, for the
Existing Senior Secured Notes, among the Company, as issuer, Energy, as guarantor, and National
City Bank, as the trustee, as supplemented by Supplemental Indenture thereto dated as of March 15,
2007, as in effect on the Closing Date.

     “Existing Loan Documents” is defined in Recital C.

     “Existing Letters of Credit” is defined in clause (c) of Section
2.3.1.

     “Existing Senior Secured Notes” means the Company’s 10% Senior Secured Notes Due 2007
in the original principal amount of $100,579,000.

16

 

     “Facilities” means the Company’s acetic acid manufacturing facility, styrene monomer
manufacturing facility, phthalic anhydride manufacturing facility and plasticizers esters
manufacturing facility and, in each case, all improvements thereto.

     “Federal Funds Rate” means, for any period, a fluctuating interest rate per annum
equal for each day during such period to (a) 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 for such day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York; or (b) if such rate is not so published for any day which
is a Business Day, the average of the quotations for such day on such transactions received by the
Administrative Agent from three federal funds brokers of recognized standing selected by it.

     “Fee Letter” means, collectively, the commitment letter, dated February 15, 2007,
between the Company and CIT and the rate and fee letter, dated March 29, 2007, between the Company
and CIT, in each case, as amended, supplemented, amended and restated or otherwise modified from
time to time.

     “Fiscal Quarter” means a quarter ending on the last day of March, June, September or
December.

     “Fixed Charge Coverage Ratio” means, as of any date of determination, the ratio of (a)
EBITDA for the trailing twelve-month period ending on such date, to (b) Fixed Charges for the
trailing twelve-month period ending on such date.

     “Fixed Charges” shall mean, for any period, the sum of the following, each calculated
(without duplication) for the Company and its Restricted Subsidiaries, on a consolidated basis, for
such period: (i) Capital Expenditures, plus (ii) Interest Expense to the extent actually
paid in such period, plus (iii) scheduled payments of principal with respect to all
Indebtedness of the Company and its Restricted Subsidiaries, plus, (iv) federal, state,
local and foreign income taxes, excluding deferred taxes, to the extent actually paid in such
period, plus (v) cash Investments in Unrestricted Subsidiaries actually made in such
period.

     “Foreign Account” means any Account for which the Account Debtor is a Foreign Obligor.

     “Foreign Obligor” means an Account Debtor that is not subject to the jurisdiction of
federal or state courts in the United States .

     “Foreign Subsidiary” means any Subsidiary that is not a Subsidiary incorporated or
organized in the United States or any State.

     “F.R.S. Board” means the Board of Governors of the Federal Reserve System or any
successor thereto.

     “GAAP” means generally accepted United States accounting principles, applied on a
consistent basis (except for changes made due to the implementation of new or revised standards
issued by the Financial Accounting Standards Board), and which are applicable in the

17

 

circumstances as of the date in question. Accounting principles are applied on a “consistent
basis” when the accounting principles observed in a current period are comparable in all material
respects to those accounting principles applied in a preceding period.

     “Governmental Authority” means the government of the United States, any other nation
or 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.

     “Hazardous Material” means (a) any “hazardous substance”, as defined by CERCLA, (b)
any “hazardous waste”, as defined by the Resource Conservation and Recovery Act, as amended, or (c)
any pollutant or contaminant or hazardous, dangerous or toxic chemical, material or substance
(including any petroleum product) within the meaning of any other applicable federal, state or
local law, regulation, ordinance or requirement (including consent decrees and administrative
orders) relating to or imposing liability or standards of conduct concerning any hazardous, toxic
or dangerous waste, substance or material, all as amended.

     “Hedging Agreement” means, collectively, any currency exchange agreement, interest
rate swap agreement, interest rate cap agreement, interest rate collar agreement, Commodity Hedging
Agreement or similar agreement or arrangement entered into by a Borrower under which the
counterparty of such agreement is (or at the time such agreement was entered into, was) a Lender or
an Affiliate of a Lender.

     “Hedging Obligations” means, with respect to any Person, all liabilities of such
Person under currency exchange agreements, interest rate swap agreements, interest rate cap
agreements, Commodity Hedging Agreements and interest rate collar agreements, and all other
agreements or arrangements designed to protect such Person against fluctuations in interest rates,
currency exchange rates or commodity prices and not entered into for purely speculative purposes.

     “herein”, “hereof”, “hereto”, “hereunder” and similar terms
contained in any Loan Document refer to such Loan Document as a whole and not to any particular
Section, paragraph or provision of such Loan Document.

     “Highest Lawful Rate” means, with respect to each Lender, the maximum nonusurious
interest rate, if any, that at any time or from time to time may be contracted for, taken,
reserved, charged or received on the Loans or on any other Obligation, as the case may be, owed to
it under the law of any jurisdiction whose laws may be mandatorily applicable to such Lender
notwithstanding other provisions of this Agreement, or under the law of the United States
applicable to such Lender which would permit such Lender to contract for, charge, take, reserve or
receive a greater amount of interest than under such jurisdiction’s law.

     “Impermissible Qualification” means any qualification or exception to the opinion or
certification of any independent public accountant as to any financial statement of the Borrowers:

     (a) which is of a “going concern” or similar nature;

18

 

     (b) which relates to the limited scope of examinations of matters due to limitations
imposed by the Borrowers relevant to such financial statement; or

     (c) which relates to the treatment or classification of any item in such financial
statement and which, as a condition to its removal, would require an adjustment to such item
the effect of which would be to cause the Borrowers to be in Default.

     “including” and “include” means including, without limiting the generality of
any description preceding such term.

     “Indebtedness” of any Person means (without duplication):

     (a) all obligations of such Person for borrowed money or advances and all obligations
of such Person evidenced by bonds, debentures, notes or similar instruments and all Capital
Securities which have redemption provisions exercisable at the option of the holder thereof
at any time prior to the date which is one year after the Maturity Date (in the absence of
any contingency) in whole or in part in cash;

     (b) all obligations, contingent or otherwise, relative to the face amount of all
letters of credit, whether or not drawn, and banker’s acceptances issued for the account of
such Person;

     (c) all Capitalized Lease Liabilities of such Person;

     (d) for purposes of Section 8.1.5 only, all other items which, in accordance
with GAAP, would be included as liabilities on the liability side of the balance sheet of
such Person as of the date at which Indebtedness is to be determined;

     (e) net liabilities of such Person under all Hedging Obligations;

     (f) whether or not so included as liabilities in accordance with GAAP, all obligations
of such Person to pay the deferred purchase price of property or services excluding trade
accounts payable in the ordinary course of business which are not overdue for a period of
more than 60 days or, if overdue for more than 60 days, as to which a dispute exists and
adequate reserves in conformity with GAAP have been established on the books of such Person,
and indebtedness of the types otherwise referred to in this definition secured by (or for
which the holder of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) a Lien on property owned or being acquired by such Person (including
Indebtedness arising under conditional sales or other title retention agreements), whether
or not such Indebtedness shall have been assumed by such Person or is limited in recourse;

     (g) obligations arising under Synthetic Leases; and

     (h) all Contingent Liabilities of such Person in respect of any of the foregoing.

The Indebtedness of any Person shall include the Indebtedness of any other entity (including any
partnership or joint venture in which such Person is a general partner) to the extent such Person

19

 

is liable therefor as a result of such Person’s ownership interest in or other relationship with
such entity, except to the extent the terms of such Indebtedness, ownership interest or other
relationship provide that such Person is not liable therefor.

     “Indemnified Liabilities” is defined in Section 10.4.

     “Indemnified Parties” is defined in Section 10.4.

     “Indenture” means the Indenture, dated as of March 29, 2007, for the Senior Secured
Notes, among the Company, as issuer, Sterling Chemicals Energy, Inc., as guarantor, and U. S. Bank
National Association, as the trustee, as in effect on the Closing Date.

     “Indenture Collateral” means the “Indenture Collateral” as that term is defined in the
Intercreditor Agreement.

     “Indenture Deed of Trust” means that certain Deed of Trust, Assignment of Leases and
Rents, Security Agreement and Fixture Filing, dated as of March 29, 2007, made by the Company to
the Trustee for the benefit of the holders of the Senior Secured Notes, as security for the payment
of the Senior Secured Notes, as in effect on the Closing Date.

     “Indenture Security Agreement” means the Security Agreement, dated as of March 29,
2007, made by the Company and Energy, as assignors, to U. S. Bank National Association, as
collateral agent, and U. S. Bank National Association, as indenture trustee for the benefit of the
holders of the Senior Secured Notes, as in effect on the Closing Date.

     “Insurance Proceeds” means all proceeds or payments from any insurance carrier with
respect to any loss, casualty, damage or destruction to any Properties of any Borrower or any
Restricted Subsidiary.

     “Intellectual Property Collateral” has the collective meaning provided for such term
in the Security Agreements.

     “Intercreditor Agreement” means the Intercreditor Agreement executed and delivered
pursuant to the terms of this Agreement by the Administrative Agent, on behalf of itself and the
other Lenders, and the Trustee, and acknowledged by the Borrowers, substantially in the form of
Exhibit I hereto, as amended, supplemented, amended and restated or otherwise modified from time to
time.

     “Interest Expense” mean, with respect to any specified Person for any period, the sum,
without duplication, of the consolidated interest expense of such Person and its Restricted
Subsidiaries for such period, whether paid or accrued, including amortization of debt issuance
costs and original issue discount, non-cash interest payments, the interest component of any
deferred payment obligations, the interest component of all payments associated with Capitalized
Lease Liabilities, imputed interest with respect to Synthetic Leases, commissions, discounts and
other fees and charges incurred in respect of letter of credit or bankers’ acceptance financings,
and net of the effect of all payments made or received pursuant to Hedging Obligations in respect
of interest rates.

20

 

     “Interest Period” means, relative to any LIBO Rate Loan, the period beginning on (and
including) the date on which such LIBO Rate Loan is made or continued as, or converted into, a LIBO
Rate Loan pursuant to Sections 2.3 or 2.4 and shall end on (but exclude) the day
which numerically corresponds to such date one, two, three or six months thereafter (or, if such
month has no numerically corresponding day, on the last Business Day of such month), as the
applicable Borrower may select in its relevant notice pursuant to Sections 2.3 or
2.4; provided, however, that:

     (a) such Borrower shall not be permitted to select Interest Periods to be in effect at
any one time which have expiration dates occurring on more than five (5) different dates;

     (b) if such Interest Period would otherwise end on a day which is not a Business Day,
such Interest Period shall end on the next following Business Day (unless such next
following Business Day is the first Business Day of a calendar month, in which case such
Interest Period shall end on the Business Day next preceding such numerically corresponding
day); and

     (c) no Interest Period for any Loan may end later than the Maturity Date for such Loan.

     “Investment” means, relative to any Person,

     (a) any loan, advance, extension of credit or contribution made by such Person to any
other Person, including the purchase by such Person of any bonds, notes, debentures or other
debt securities of any other Person;

     (b) any Contingent Liability of such Person incurred in connection with loans, advances
or extensions of credit made by others to any other Person; and

     (c) any Capital Securities held by such Person in any other Person.

The amount of any Investment shall be the original principal or capital amount thereof less all
returns of principal or equity thereon and shall, if made by the transfer or exchange of property
other than cash, be deemed to have been made in an original principal or capital amount equal to
the fair market value of such property at the time of such Investment.

     “inventory” means all “inventory” as such term is defined in Section 9-102 of the
U.C.C.

     “Investment Grade Rating” means, with respect to any Person, that such Person has been
assigned a corporate long term credit rating of Baa3 or higher by Moody’s and BBB or higher by S&P.

     “ISP98 Rules” is defined in Section 10.9.

     “Issuance Request” means a Letter of Credit request duly executed by an Authorized
Officer of the applicable Borrower, substantially in the form of Exhibit B-2 hereto.

21

 

     “Issuer” means, collectively, JPMorgan Chase Bank, N.A. and/or any other Person
issuing Letters of Credit hereunder, as designated by the Administrative Agent, in its capacity as
Issuer of the Letters of Credit and any other Lender designated by any Borrower that issues a
Letter of Credit with the consent of the Administrative Agent, which consent shall not be
unreasonably withheld.

     “Joinder Agreement” means a Joinder Agreement, substantially in the form of
Exhibit H hereto, executed and delivered by each Person who is required to become (or
otherwise becomes, pursuant to the terms of this Agreement) a Borrower in accordance with
Section 7.1.8.

     “Lender Assignment Agreement” means an assignment agreement substantially in the form
of Exhibit J hereto.

     “Lenders” is defined in the Introductory Statement and includes any Person that
becomes a Lender pursuant to Section 10.11.1.

     “Lender’s Environmental Liability” means any and all losses, liabilities, obligations,
penalties, claims, litigation, demands, defenses, costs, judgments, suits, proceedings, damages
(including consequential damages), disbursements or expenses of any kind or nature whatsoever
(including reasonable attorneys’ fees at trial and appellate levels and experts’ fees and
disbursements and expenses incurred in investigating, defending against or prosecuting any
litigation, claim or proceeding) which may at any time be imposed upon, incurred by or asserted or
awarded against the Administrative Agent, any Lender or Issuer or any of such Person’s Affiliates,
shareholders, directors, officers, employees, and agents in connection with or arising from:

     (a) any Hazardous Material on, in, under or affecting all or any portion of any
property of any Borrower or any Subsidiary of any Borrower, the groundwater thereunder, or
any surrounding areas thereof to the extent caused by Releases from Properties of any
Borrower or any Subsidiary of any Borrower;

     (b) any misrepresentation, inaccuracy or breach of any warranty, contained or referred
to in Section 6.12;

     (c) any violation or claim of violation by the Company or any of its Subsidiaries of
any Environmental Laws; or

     (d) the imposition of any Lien for damages caused by or the recovery of any costs for
the cleanup, release or threatened release of Hazardous Material by the Company or any of
its Subsidiaries, or in connection with any property owned or formerly owned by the Company
or any of its Subsidiaries.

     “Letter of Credit” is defined in clause (a) of Section 2.1.2.

     “Letter of Credit Commitment” means, with respect to the Issuer, the Issuer’s
obligation to issue Letters of Credit pursuant to Section 2.1.2 and, with respect to each
Lender, the obligations of each such Lender to participate in such Letters of Credit pursuant to
Section 2.6.1.

22

 

     “Letter of Credit Commitment Amount” means, on any date, the lesser of (a) the then
applicable Maximum Loan Amount on such date and (b) $25,000,000, as such amount may be permanently
reduced from time to time pursuant to Section 2.2 and other provisions of this Agreement.

     “Letter of Credit Outstandings” means, on any date, an amount equal to the sum of (a)
the then aggregate amount of all Stated Amounts of all issued and outstanding Letters of Credit,
plus (b) the then aggregate amount of all unpaid and outstanding Reimbursement Obligations.

     “LIBO Rate” means, relative to any Interest Period for LIBO Rate Loans, the rate per
annum equal to the rate at which Dollar deposits are offered for such Interest Period as set forth
on the Telerate Screen LIBO Page, at or about 12:00 noon, New York City time, two Business Days
prior to the beginning of such Interest Period for delivery on the first day of such Interest
Period, and in an amount approximately equal to the amount of the LIBO Rate Loan and for a period
approximately equal to such Interest Period; provided, however, that if there shall
at any time no longer exist a Telerate Screen LIBO Page, “LIBO Rate” shall mean, with
respect to each day during each Interest Period pertaining to a LIBO Rate Loan, the rate per annum
equal to the rate at which the Administrative Agent or its designee is offered Dollar deposits at
or about 12:00 noon, New York City time, two Business Days prior to the beginning of such Interest
Period in the interbank eurodollar market where the eurodollar and foreign currency and exchange
operations in respect of LIBO Rate Loans are then being conducted for delivery on the first day of
such Interest Period for the number of days comprised therein and in an amount comparable to the
amount of the LIBO Rate Loan to be outstanding for a period approximately equal to such Interest
Period.

     “LIBO Rate Loan” means a Loan bearing interest, at all times during an Interest Period
applicable to such Loan, at a rate of interest determined by reference to the LIBO Rate (Reserve
Adjusted).

     “LIBO Rate (Reserve Adjusted)” means, relative to any Loan to be made, continued or
maintained as, or converted into, a LIBO Rate Loan for any Interest Period, a rate per annum
(rounded, if necessary, to the nearest 1/16 of 1%) determined pursuant to the following formula:

	 	 	 
	LIBO Rate

(Reserve Adjusted)
	 	LIBO Rate

1.00 — LIBOR Reserve Percentage

The LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate Loans will be determined by
the Administrative Agent on the basis of the LIBOR Reserve Percentage in effect two Business Days
before the first day of such Interest Period.

     “LIBOR Reserve Percentage” means, relative to any Interest Period for LIBO Rate Loans,
the reserve percentage (expressed as a decimal) equal to the maximum aggregate reserve requirements
(including all basic, emergency, supplemental, marginal and other reserves and taking into account
any transitional adjustments or other scheduled changes in reserve requirements) specified under
regulations issued from time to time by the F.R.S. Board and then applicable to assets or
liabilities consisting of or including “Eurocurrency Liabilities”, as

23

 

currently defined in Regulation D of the F.R.S. Board, having a term approximately equal or
comparable to such Interest Period.

     “Lien” means any security interest, mortgage, pledge, hypothecation, assignment for
security purposes, deposit arrangement, encumbrance, lien (statutory or otherwise), charge against
or interest in property, or other priority or preferential arrangement of any kind or nature
whatsoever, to secure payment of a debt or performance of an obligation.

     “Loan Documents” means collectively this Agreement, each Letter of Credit (including
Existing Letters of Credit), each Application (including any reimbursement and/or application
agreements executed and delivered in connection with the Existing Letters of Credit), each Hedging
Agreement, each Note, each Security Agreement, each Joinder Agreement, each Pledge Agreement, the
Intercreditor Agreement, each Control Agreement, each agreement with respect to any Banking
Services, each agreement pursuant to which the Administrative Agent or any Lender is granted a Lien
to secure the Obligations and each other agreement, certificate, document or instrument delivered
in connection with any Loan Document (including the agreements executed from time to time pursuant
to Section 7.1.8) by the Borrowers, whether or not specifically mentioned herein or
therein.

     “Loans” means, as the context may require, a Revolving Credit Loan or a Swing Line
Loan of any Type.

     “Material Adverse Effect” means a material adverse effect on (a) the business,
condition (financial or otherwise), operations, performance or properties of the Company or the
Company and its Subsidiaries taken as a whole, (b) the rights and remedies of any Secured Party
under any Loan Document or (c) the ability of the Company or the Company and the other Borrowers,
taken as a whole, to perform their Obligations under the Loan Documents.

     “Material Contracts” means (a) any and all contracts, licenses, leases or other
agreements the cancellation or termination of which could reasonably be expected to have a Material
Adverse Effect and (b) any and all contracts, licenses, leases or other agreements which (i) are
necessary for the continued operation of the Texas City Facility, or (ii) generate ten percent
(10%) or more of the total Accounts of the Borrowers.

     “Maturity Date” means the earliest to occur of (a) the date which is the sixtieth
month anniversary of the Closing Date and (b) the date which is three months prior to the Stated
Maturity of the Senior Secured Notes.

     “Maximum Loan Amount” means, at any time, the lesser of (a) the Borrowing Base Amount,
minus the amount of any Availability Reserve (as adjusted from time to time pursuant to the
terms of the definition thereof and/or clause (e) of Section 2.7) and (b) the
Revolving Credit Commitment Amount.

     “Measurement Date” means the last day of any calendar month on which (a) Excess
Availability is less than $10,000,000 (as determined on such last day of such calendar month) and
(b) if there are no Loans outstanding on such day, the sum of (i) Excess Availability on such day
plus (b) the Companies’ unrestricted cash on hand on such day, is less than $10,000,000.

24

 

     “Merge” is defined in Section 7.2.9.

     “Monthly Payment Date” means the last day of each calendar month, or, if any such day
is not a Business Day, the next succeeding Business Day.

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

     “Net Debt Proceeds” means, with respect to the incurrence, sale or issuance by any
Borrower or any Restricted Subsidiary of any Indebtedness after the Closing Date (other than
Indebtedness permitted by Section 7.2.2), the excess of (a) the gross cash proceeds
received by such Borrower or such Restricted Subsidiary from such incurrence, sale or issuance,
minus (b) the sum (without duplication) of all reasonable and customary underwriting
commissions and legal, investment banking, brokerage and accounting and other professional fees,
sales commissions and disbursements and all other reasonable fees, expenses (including any State
filing taxes) and charges, in each case actually incurred in connection with such incurrence, sale
or issuance.

     “Net Disposition Proceeds” means, with respect to any casualty, condemnation and/or
Disposition of or with respect to any Properties of any Borrower or any Restricted Subsidiary after
the Closing Date, other than the Dispositions permitted in clauses (a), (b),
(c), (d), (e), (i) and (j) of the definition of “Permitted
Disposition” or an issuance or sale of any Capital Securities of the Company or warrants or options
with respect thereto, the excess of (a) the Insurance Proceeds, Condemnation Proceeds
and/or gross cash proceeds from such casualty, condemnation and/or Disposition received by any such
Borrower or Restricted Subsidiary (including any such proceeds from casualties, condemnations
and/or Dispositions of Indenture Collateral not constituting Net Loss Proceeds or Net Proceeds) and
any cash payments received in respect of promissory notes or other non-cash consideration delivered
to any such Borrower or Restricted Subsidiary in respect thereof, minus (b) the sum
(without duplication) of (i) all reasonable and customary fees and expenses with respect to legal,
investment banking, brokerage, accounting and other professional fees, sales commissions and
disbursements and all other reasonable fees, expenses and charges, in each case actually incurred
in connection with any such casualty, condemnation and/or Disposition, (ii) all Taxes and other
governmental costs and expenses actually paid or estimated by any such Borrower or Restricted
Subsidiary (in good faith) to be payable in cash in connection with any such casualty, condemnation
and/or Disposition, provided, that if, after the payment of all Taxes with respect to any
such casualty, condemnation and/or Disposition, the amount of estimated Taxes, if any, pursuant to
this clause (b)(ii) exceeded the Tax amount actually paid in cash in respect of any such
casualty, condemnation and/or Disposition, the aggregate amount of such excess shall be immediately
payable, pursuant to clause (c) of Section 3.1.1, as Net Disposition Proceeds, and
(iii) the amount of Net Proceeds or Net Loss Proceeds received from any casualty, condemnation
and/or Disposition of Indenture Collateral (but excluding in all cases any proceeds of Collateral)
to be used to replace such Indenture Collateral in accordance with Sections 4.16 and/or Section
4.17 of the Indenture or to repurchase the Senior Secured Notes as required under Sections 4.16
and/or Section 4.17 of the Indenture, provided, in the case of a Disposition, that such
Disposition is permitted under this Agreement and, in any case, that no Default or Event of Default
then exists or will result from such repurchase of the Senior Secured Notes, including a Default
under Section 7.2.7; and, provided further that after the repair or
replacement of any Indenture

25

 

Collateral subject to such casualty, condemnation and/or Disposition in accordance with
Sections 4.16 and/or Section 4.17 of the Indenture and the completion of the Event of Loss Offer
and/or Asset Sale Offer with respect to such casualty, condemnation and/or Disposition of Indenture
Collateral, all Net Loss Proceeds and/or Net Proceeds received in connection with such casualty,
condemnation and/or Disposition of Indenture Collateral which is not used to repair or replace the
Indenture Collateral (in accordance with Sections 4.16 and/or Section 4.17 of the Indenture) and/or
to repurchase the Senior Secured Notes (in accordance with Sections 4.16 and/or Section 4.17 of the
Indenture) is immediately used to prepay the Obligations as provided in Section 3.1.1(c)
and Section 3.1.2(b) or deposited in a Controlled Deposit Account subject to a Control
Agreement, as applicable.

     “Net Loss Proceeds” means “Net Loss Proceeds” as defined in the Indenture.

     “Net Proceeds” means “Net Proceeds” as defined in the Indenture.

     “No Less Favorable Terms and Conditions” means, with respect to any refinancing of any
Indebtedness permitted hereunder, terms and conditions which are no less favorable to the Lenders,
taken as a whole, and evidenced by documentation which shall not (a) increase the principal amount
of (as the same may have been permanently reduced subsequent to the Closing Date) or interest rate
on such outstanding Indebtedness, (b) reduce either the tenor or the average life of such
Indebtedness, (c) change the respective primary obligor(s) on the refinancing Indebtedness (other
than a change from any Borrower to any other Borrower or any Restricted Subsidiary, or a change
from any Restricted Subsidiary to any other Restricted Subsidiary, (d) change the security, if any,
for the refinancing Indebtedness (except to the extent that less security is granted to holders of
such refinancing Indebtedness), (e) afford the holders of such refinancing Indebtedness other
covenants, defaults, rights or remedies, taken as a whole, more burdensome to the obligor(s) than
those contained in the Indebtedness being refinanced (and in the case of Subordinated Debt, none of
the subordination provisions contained in the refinancing Indebtedness shall be less favorable to
the Lenders, any Issuer or the Administrative Agent, taken as a whole, than the Indebtedness being
refinanced), or (f) if such Indebtedness being refinanced is secured by Liens, afford the holders
of such refinancing Indebtedness any Liens on any Collateral which are prior to any of the Liens
securing the Obligations.

     “Non-Excluded Taxes” means any Taxes other than net income and franchise taxes imposed
with respect to any Secured Party by (a) any jurisdiction (or political subdivision thereof) of
which such Secured Party is a citizen or resident, (b) any jurisdiction (or political subdivision
thereof) in which such Secured Party is presently engaged in the active conduct of its banking
business through an office, branch or other permanent establishment, or (c) the jurisdiction (or
any political subdivision thereof) under the laws of which such Secured Party is organized or in
which it maintains its applicable lending office.

     “Non-Facility Assets” means (a) any asset of the Borrowers or any of their Restricted
Subsidiaries other than (i) any asset that constitutes Collateral, (ii) the Facilities or (iii) any
asset (A) used primarily in connection with the operation of any of the Facilities or (B) the loss
of which would result in the Company expending more than $1,000,000 in the aggregate to operate its
acetic acid, styrene or plasticizers business as currently conducted by the Borrowers, and (b) any
other asset of the Borrowers or any of the Restricted Subsidiaries that primarily relates to the

26

 

construction, use, occupancy, possession, operation or ownership of any asset that is not
described in the exclusion to clause (a), which may include Collateral (other than Accounts,
inventory or Capital Securities of any Borrower or any Restricted Subsidiary).

     “Non-U.S. Lender” means any Lender that is not a “United States person”, as defined
under Section 7701(a)(30) of the Code.

     “Non-Recourse Debt” means Indebtedness:

     (a) as to which neither the Company nor any of its Restricted Subsidiaries (i) provides
credit support of any kind (including any undertaking, agreement or instrument that would
constitute Indebtedness) other than a pledge of the Capital Securities of Unrestricted
Subsidiaries, (ii) is directly or indirectly liable (as a guarantor or otherwise), other
than by virtue of a non-recourse pledge of the Capital Securities of an Unrestricted
Subsidiary, or (iii) constitutes the lender; and

     (b) no default with respect to which (including any rights that the holders of the
Indebtedness may have to take enforcement action against an Unrestricted Subsidiary) would
permit upon notice, lapse of time or both any holder of any other Indebtedness of the
Company or any of its Restricted Subsidiaries to declare a default on such other
Indebtedness or cause the payment of the Indebtedness to be accelerated or payable prior to
its Stated Maturity.

     “Note” means, as the context may require, a Revolving Credit Note or a Swing Line
Note.

     “Obligation Account” is defined in clause (c) of Section 2.7.

     “Obligations” means all obligations of every kind and nature, including principal,
fees, interest (including interest which accrues after or would accrue but for the commencement of
any case, proceeding or other action relating to the bankruptcy, insolvency or reorganization of
the Borrowers), expenses, indemnities and all other sums, monetary or otherwise, whether absolute
or contingent, matured or unmatured, of the Borrowers and each other Borrower arising under, in
connection with or relating to the Loans, the Loan Commitments, Banking Services Obligations,
Hedging Obligations under a Hedging Agreement, any Security Document or any other Loan Document
which secures or guarantees such obligations, in each case, to the extent such obligations are owed
to any Secured Party.

     “Organic Document” means, with respect to any Borrower or any Restricted Subsidiary,
as applicable, its certificate of incorporation, by-laws, certificate of partnership, partnership
agreement, certificate of formation, limited liability company agreement and all shareholder
agreements, voting trusts and similar arrangements applicable to any of such Borrower’s or such
Restricted Subsidiary’s partnership interests, limited liability company interests or authorized
shares of Capital Securities.

     “Other Taxes” means any and all stamp, documentary or similar taxes, or any other
excise or property taxes or similar levies that arise on account of any payment made or required

27

 

to be made under any Loan Document or from the execution, delivery, registration, recording or
enforcement of any Loan Document.

     “Participant” is defined in Section 10.11.2.

     “PBGC” means the Pension Benefit Guaranty Corporation and any entity succeeding to any
or all of its functions under ERISA.

     “Pension Plan” means a “pension plan”, as such term is defined in Section 3(2) of
ERISA, which is subject to Title IV of ERISA (other than a multiemployer plan as defined in Section
4001(a)(3) of ERISA), and to which the Company or any corporation, trade or business that is, along
with the Company, a member of a Controlled Group, may have liability, including any liability by
reason of having been a substantial employer within the meaning of Section 4063 of ERISA at any
time during the preceding five years, or by reason of being deemed to be a contributing sponsor
under Section 4069 of ERISA.

     “Percentage” means, relative to any Lender, the applicable percentage set forth
opposite its name on Schedule II hereto or set forth in a Lender Assignment Agreement, as
such percentage may be adjusted from time to time pursuant to Lender Assignment Agreements executed
by such Lender and its Assignee Lender and delivered pursuant to Section 10.11.1.

     “Perfection Certificate” means the Perfection Certificate executed and delivered by an
Authorized Officer of each Borrower that is a party to a Security Agreement pursuant to the terms
of this Agreement, substantially in the form of Exhibit K hereto, as amended, supplemented,
amended and restated or otherwise modified from time to time.

     “Permitted Disposition” means any casualty or condemnation event or Disposition
(excluding in all cases any Disposition not permitted under Section 7.2.15) that is:

     (a) a Disposition of inventory in the ordinary course of business;

     (b) a Disposition of any other Properties (other than Accounts, inventory or Capital
Securities of any Borrower or any Restricted Subsidiary) (i) at fair market value, as
determined by the Board of Directors of the Company in good faith, (including as to the
value of all noncash consideration) and at least 85% of the consideration thereof received
is in the form of cash or cash equivalents, (ii) when, in the reasonable judgment of the
Company, such other Properties are worn out or obsolete or (iii) when, in the reasonable
judgment of the Company, such other Properties are no longer used or useful in the conduct
of the business of the Borrowers or their Subsidiaries, in each of clauses (i), (ii) and
(iii), not to exceed $2,000,000 in any one transaction or series of related transactions;

     (c) a Disposition from a Borrower or a Subsidiary to another Borrower, provided
that the Company may not transfer all or substantially all of its Properties to any Person;

     (d) (i) any casualty or condemnation event with respect to the Texas City Facility or
any other Indenture Collateral (provided such Property is repaired and/or

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replaced within one year from the date of such casualty or condemnation, as applicable,
in accordance with the terms of the Indenture) and (ii) a Disposition of Properties (other
than Accounts, inventory or Capital Securities of any Borrower or any Restricted Subsidiary)
in the ordinary course of business in exchange for or in connection with the purchase
(provided such exchange or purchase is made within one year from the date of such
Disposition) of replacement assets (which are of similar or greater value) useful in the
ordinary course of the business of the Borrowers, meeting all the requirements of
Section 7.2.1; provided, that if the casualty, condemnation or Disposition
is by or pertains to Properties of a Borrower, such casualty, condemnation or Disposition
shall only be a Permitted Disposition if the repaired assets are owned, or the replacement
assets are acquired, by a Borrower;

     (e) Dispositions of Non-Facility Assets;

     (f) the granting of leases (including subleases) and ground leases of any underutilized
or vacant properties of any Borrower or any Restricted Subsidiary to third parties with
which such Borrower or Restricted Subsidiary has a production, co-production, co-generation,
operating or other agreement or to third party providers of energy or raw materials in the
ordinary course of business, provided such leases do not materially interfere with
the operation of the business of any Borrower or any Restricted Subsidiary or materially
diminish the value of any of the Collateral;

     (g) the granting of licenses (including sublicenses) of any Intellectual Property
Collateral of the Borrowers to any Person in the ordinary course of business;

     (h) Dispositions of Accounts that are overdue and no longer qualify as Eligible
Accounts in connection with the collection or compromise thereof;

     (i) Dispositions of Cash Equivalent Investments in the ordinary course of business; and

     (j) voluntary terminations of Hedging Obligations.

     “Permitted Liens” is defined in Section 7.2.3.

     “Permitted Real Estate Liens” means:

     (a) minor irregularities in title, boundaries or other survey defects, easements,
rights-of-way, restrictions, servitudes, permits, reservations, exceptions, zoning
regulations, conditions, covenants, mineral or royalty rights or reservations of oil, gas or
mineral leases, rights of others in any property of any Borrower or any Restricted
Subsidiary for streets, roads, bridges, pipes, pipelines, railroads, electric transmission
and distribution lines, telegraph and telephone lines, the removal of oil, gas or other
minerals or other similar purposes, flood control, water rights, rights of others with
respect to navigable waters, sewage and drainage rights and other similar charges or
encumbrances existing as of the Closing Date and disclosed in a survey (or granted by any
Borrower or any Restricted Subsidiary in the ordinary course of business) that do not, in
the aggregate, materially impair the value or ability to sell of the property of any
Borrower and the

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occupation, use and enjoyment by any Borrower or any Restricted Subsidiary of any of
their respective properties in the normal course of business;

     (b) Liens securing Indebtedness neither created, assumed nor guaranteed by any Borrower
or any of their Restricted Subsidiaries upon lands over which easements or similar rights
are acquired by any Borrower or any of their Restricted Subsidiaries in the ordinary course
of business of any Borrower or any of their Restricted Subsidiaries;

     (c) terminable or short term leases or permits for occupancy, which leases or permits
expressly grant to any Borrower or any Restricted Subsidiary the right to terminate them at
any time on not more than one year’s notice and which occupancy does not interfere with the
operation of the business of any Borrower or any of their Restricted Subsidiaries;

     (d) any obligations or duties affecting any of the property of any Borrower or any of
their Restricted Subsidiaries to any municipal or public authority with respect to any
franchise, grant, license or permit that do not materially impair the use of such property
for the purpose for which it is held;

     (e) Liens on any property in favor of any Governmental Authority to secure partial,
progress, advance or other payments pursuant to any contract or statute, not yet due and
payable;

     (f) Liens with respect to the so-called “greenbelt” or “buffer zone” properties;

     (g) leases and ground leases of underutilized or vacant properties of any Borrower or
any Restricted Subsidiary to third parties with which such Borrower or such Restricted
Subsidiary has a production, co-production, co-generation, operating or other arrangement or
to third party providers of energy or raw materials in the ordinary course of business of
such Borrower or such Restricted Subsidiary, provided such leases do not materially
interfere with the operations of any Borrower or any Restricted Subsidiary, or materially
diminish the value of any Collateral;

     (h) easements, rights-of-way, restrictions and other similar charges or encumbrances
granted to others, in each case incidental to, and not interfering with, the ordinary
conduct of the business of any Borrower or any Restricted Subsidiary, provided that
such Liens are not violated by the existing property and do not, in the aggregate,
materially diminish the value or ability to sell such property;

     (i) the burdens of any law or governmental regulation or permit requiring any Borrower
or any Restricted Subsidiary to maintain certain facilities or perform certain acts as a
condition of its occupancy of or interference with any public lands or any river or stream
or navigable waters;

     (j) Liens on any of the Non-Facility Assets; and

     (k) any extensions, renewals, modifications or replacements of any Lien referred to in
clauses (a) through (j) of this definition, provided that such Lien is not

30

 

otherwise prohibited by the terms hereof and, with respect to Liens securing
Indebtedness, no extension or renewal Lien shall (i) secure more than the amount of the
Indebtedness or other obligations secured by the Lien being so extended or renewed or (ii)
extend to any property or assets not subject to the Lien being so extended or renewed.

     Notwithstanding the foregoing, no such Permitted Real Estate Liens shall in any way materially
impair the value of or ability to sell any Collateral or materially impact the occupation, right or
enjoyment of the relevant property by the Borrowers or any Restricted Subsidiary.

     “Person” means any natural person, corporation, limited liability company,
partnership, joint venture, association, trust or unincorporated organization, Governmental
Authority or any other legal entity, whether acting in an individual, fiduciary or other capacity.

     “Pledge Agreement” means each Pledge Agreement and each Amended and Restated Pledge
Agreement executed and delivered by a Borrower or a Restricted Subsidiary of a Borrower to secure
the Obligations, substantially in the form of Exhibit F hereto, as amended, supplemented,
amended and restated or otherwise modified from time to time.

     “Pledged Subsidiary” means each Borrower (other than the Company) and each Restricted
Subsidiary that is not a Foreign Subsidiary in respect of which the Administrative Agent has been
granted a security interest in, or a pledge of any of, the Capital Securities of such Borrower or
Restricted Subsidiary, as security for the Obligations.

     “Projections” is defined in Section 7.1.1(m).

     “Properties” means, as to any Person, any and all interests (of whatever kind or
nature) in or to any kind of property or asset (of whatever kind or nature), whether real,
personal, mixed or tangible or intangible.

     “Receipts” means any and all sums, collections, payments, funds, proceeds and/or
receipts owing from, or remitted by, any Person to any Borrower or any Restricted Subsidiary of any
Borrower of whatever kind or nature (including cash, checks, credit card sales, promissory notes,
instruments and documents of title and, to the extent not used to repair or replace the relevant
assets or repurchase the Senior Secured Notes, Insurance Proceeds and Condemnation Proceeds) in
respect of Accounts and/or any other Collateral and any and all other property or assets of the
Borrowers and any Restricted Subsidiaries of the Borrowers other than Indenture Collateral or cash
or Cash Equivalent Investments deposited in trust with the trustee under the Existing Indenture for
redemption of the Existing Senior Secured Notes; provided, however, that in the
event that any proceeds from or of Indenture Collateral remain after any offer to repurchase the
Senior Secured Notes has been consummated in accordance with the terms of the Indenture and this
Agreement, or upon the payment in full of the Senior Secured Notes, any and all remaining proceeds
from or of the Indenture Collateral shall be deemed to be Receipts.

     “Refunded Swing Line Loans” is defined in clause (b) of Section 2.3.2.

     “Register” is defined in clause (b) of Section 2.7.

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     “Reimbursement Obligation” is defined in Section 2.6.3.

     “Release” means a “release”, as such term is defined in CERCLA.

     “Required Lenders” means, at any time, Lenders holding 51% or more of the Revolving
Credit Commitments (determined on a combined basis), or if any of the Revolving Credit Commitments
have been terminated or are otherwise no longer in effect, then Lenders holding 51% or more of the
Obligations; provided that, if any Lender, together with its Affiliates (collectively, the
“Majority Lender”), holds 51% or more of the Revolving Credit Commitments (determined on a
combined basis), or if any of the Revolving Credit Commitments have been terminated or are
otherwise no longer in effect, 51% or more of the Obligations, then “Required Lenders”
shall mean the Majority Lender, together with one other Lender that is not an Affiliate of the
Majority Lender.

     “Resource Conservation and Recovery Act” means the Resource Conservation and Recovery
Act, 42 U.S.C. Section 6901, et seq., as amended.

     “Restricted Payment” means the declaration or payment of any dividend (other than
dividends payable solely in Capital Securities of the Company) on, or the making of any payment or
distribution on account of, or setting apart assets for a sinking or other analogous fund for, the
purchase, redemption, defeasance, retirement or other acquisition of any class of Capital
Securities of the Borrowers or any Restricted Subsidiary or any warrants or options to purchase any
such Capital Securities, whether now or hereafter outstanding, or the making of any other
distribution in respect thereof, either directly or indirectly, whether in cash or property,
obligations of the Borrowers or any Restricted Subsidiary or otherwise, other than any such
dividends, payments or distributions that are payable to any Borrower or any Restricted Subsidiary
(so long as such dividend, payment or distribution payable to a Restricted Subsidiary is not
payable from a Borrower).

     “Restricted Subsidiary” of a Person means any Subsidiary of such Person that is not an
Unrestricted Subsidiary. Unless the context otherwise specifically requires, the term “Restricted
Subsidiary” or “Restricted Subsidiaries” shall be a reference to a Restricted Subsidiary or the
Restricted Subsidiaries, as applicable, of the Company, other than the Borrowers.

     “Revolving Credit Commitment” means, relative to any Lender, such Lender’s obligation
(if any) to make Loans pursuant to clause (a) of Section 2.1.1, in an amount not to
exceed the product of (i) such Lender’s Percentage, multiplied by, (ii) the then applicable
Revolving Credit Commitment Amount.

     “Revolving Credit Commitment Amount” means, on any date, a maximum aggregate amount of
$50,000,000, as such amount may be permanently reduced from time to time pursuant to Section
2.2 and other provisions of this Agreement.

     “Revolving Credit Note” means a joint and several promissory note of each Borrower
payable to any Lender, in the form of Exhibit A-1 hereto (as such promissory note may be
amended, endorsed or otherwise modified from time to time), evidencing the joint and several
aggregate Indebtedness of the Borrowers to such Lender resulting from outstanding Loans, and

32

 

also means all other promissory notes accepted from time to time in substitution therefor or
renewal thereof.

     “Revolving Credit Loans” is defined in clause (a) of Section 2.1.1.

     “S&P” means Standard & Poor’s Rating Services, a division of McGraw-Hill, Inc.

     “SEC” means the Securities and Exchange Commission.

     “SEC Documents” means, collectively, (a) the Company’s annual report on Form 10-K for
the fiscal year ended December 31, 2006 and (b) each current report on Form 8-K filed by the
Company with the SEC during the period between the filing date of such Form 10-K and March 27,
2007.

     “Secured Parties” means collectively, the Lenders, the Administrative Agent, each
Lender or Affiliate thereof that provides Banking Services or is owed Banking Services Obligations,
each counterparty to a Hedging Agreement that is (or at the time such Hedging Agreement was entered
into, was) a Lender or an Affiliate thereof and (in each case), each of their respective
successors, transferees and assigns to the extent permitted by this Agreement.

     “Security Agreement” means each Security Agreement and each Amended and Restated
Security Agreement executed and delivered by a Borrower or a Restricted Subsidiary to secure the
Obligations, substantially in the form of Exhibit G hereto, as amended, supplemented,
amended and restated or otherwise modified from time to time.

     “Security Document” means any and all agreements or instruments now or hereafter
executed and delivered by any Borrower or any other Person as security for the payment or
performance of the Obligations, including all Security Agreements, Pledge Agreements and Control
Agreements, as any of the foregoing may be amended, modified, renewed, supplemented or restated
from time to time.

     “Senior Secured Note Documents” means, collectively, the Indenture, the Senior Secured
Notes, the Indenture Deed of Trust, the Indenture Security Agreement and each of the other security
or other collateral agreements, indentures, note purchase agreements, promissory notes, guarantees,
and other instruments and agreements executed and delivered in connection with the issuance of the
Senior Secured Notes, in each case as in effect on the Closing Date.

     “Senior Secured Notes” means the Company’s 101/4% Senior Secured Notes Due 2015 in the
original principal amount of $150,000,000.

     “Solvent” means, with respect to any Person on a particular date, that on such date
(a) the fair value of the property of such Person and its Subsidiaries on a consolidated basis is
greater than the total amount of liabilities, including Contingent Liabilities, of such Person and
its Subsidiaries on a consolidated basis, (b) the present fair salable value of the assets of such
Person and its Subsidiaries on a consolidated basis, is not less than the amount that will be
required to pay the probable liability of such Person and its Subsidiaries on a consolidated basis
on its debts as they become absolute and matured, (c) such Person does not intend to, and does not
believe that it or its Subsidiaries will, on a consolidated basis, incur debts or liabilities

33

 

beyond the ability of such Person and its Subsidiaries on a consolidated basis to pay as such
debts and liabilities mature, and (d) such Person and its Subsidiaries on a consolidated basis are
not engaged in business or a transaction, and such Persons and its Subsidiaries on a consolidated
basis are not about to engage in business or a transaction, for which the property of such Person
and its Subsidiaries would constitute an unreasonably small capital. The amount of Contingent
Liabilities at any time shall be computed as the amount that, in light of all the facts and
circumstances existing at such time, can reasonably be expected to become an actual or matured
liability.

     “State” means the several states of the United States and the District of Columbia and
their respective political subdivisions.

     “Stated Amount” means, on any date and with respect to a particular Letter of Credit,
the total amount then available to be drawn under such Letter of Credit.

     “Stated Expiry Date” is defined in Section 2.6.

     “Stated Maturity” means, with respect to any installment of interest or principal on
any series of Indebtedness, the date on which the payment of interest or principal was scheduled to
be paid in the documentation governing such Indebtedness as of the date such documentation was
entered into, and will not include any contingent obligations to repay, redeem or repurchase any
such interest or principal prior to the date originally scheduled for the payment thereof.

     “Subordinated Debt” means any Indebtedness of any Borrower or any Restricted
Subsidiary subordinated in right of payment to the Obligations pursuant to documentation containing
redemption and other prepayment events, maturities, amortization schedules, covenants, events of
default, remedies, acceleration rights, subordination provisions and other material terms
reasonably satisfactory to the Required Lenders.

     “Subsidiary” means, with respect to any Person, (a) any corporation, limited liability
company, partnership or other entity of which more than 50% of the Voting Stock is at the time
directly or indirectly owned or controlled by such Person, by such Person and one or more other
Subsidiaries of such Person, or by one or more other Subsidiaries of such Person or (b) any
partnership, joint venture or other entity as to which such Person, such Person and one or more of
its Subsidiaries or one or more Subsidiaries of such Person owns more than a 50% ownership, equity
or similar interest or has power to direct or cause the direction of management and policies
(directly or indirectly), or the power to elect the managing partner (or the equivalent), of such
partnership, joint venture or other entity, as the case may be. Unless the context otherwise
specifically requires, the term “Subsidiary” or “Subsidiaries” shall be a reference to a Subsidiary
or the Subsidiaries, as applicable, of the Company, other than the Borrowers.

     “Swing Line Lender” means the Administrative Agent (or another Lender designated by
the Administrative Agent with the consent of the Company (such consent not to be unreasonably
withheld), if such Lender agrees to be the Swing Line Lender hereunder), in such Person’s capacity
as the maker of Swing Line Loans.

     “Swing Line Loans” is defined in clause (b) of Section 2.1.1.

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     “Swing Line Loan Commitment” is defined in clause (b) of Section
2.1.1.

     “Swing Line Loan Commitment Amount” means, on any date, the lesser of (a) the then
applicable Maximum Loan Amount and (b) $10,000,000, as such amount may be permanently reduced from
time to time pursuant to Section 2.2 and other provisions of this Agreement.

     “Swing Line Note” means a joint and several promissory note of each Borrower payable
to the Swing Line Lender, in the form of Exhibit A-2 hereto (as such promissory note may be
mended, endorsed or otherwise modified from time to time), evidencing the joint and several
aggregate Indebtedness of the Borrowers to the Swing Line Lender resulting from outstanding Swing
Line Loans, and also means all other promissory notes accepted from time to time in substitution
therefor or renewal thereof.

     “Synthetic Lease” means, as applied to any Person, any lease (including leases that
may be terminated by the lessee at any time) of any property (whether real, personal or mixed) (a)
that is not a capital lease in accordance with GAAP and (b) in respect of which the lessee retains
or obtains ownership of the property so leased for federal income tax purposes, other than any such
lease under which that Person is the lessor.

     “Taxes” means any and all income, stamp or other taxes, duties, levies, imposts,
charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or
assessed by any Governmental Authority, and all interest, penalties or similar liabilities with
respect thereto.

     “Telerate Screen LIBO Page” means the display designated as “Page 3750” on the
Telerate System Incorporated Service (or such other page as may replace Page 3750 on the service or
such other service as may be nominated by the British Bankers’ Association as the information
vendor for the purpose of displaying British Bankers’ Association interest settlement rates for
Dollar deposits).

     “Termination Date” means the date on which all Obligations (other than any contingent
indemnification or expense reimbursement Obligations that are not then due and payable) have been
paid in full in cash, all Letters of Credit have been terminated, expired or Cash Collateralized,
all Hedging Agreements have been terminated and all Commitments have been permanently terminated.

     “Texas City Facility” means the petrochemicals production facilities owned by the
Company that are located in Texas City, Texas, including all of the real estate, equipment,
fixtures and other property associated therewith, all as more particularly described in, and
covered by the Lien granted in, the Indenture Deed of Trust.

     “Trustee” means U. S. Bank National Association, as trustee under the Indenture.

     “Type” means, relative to any Loan, the portion thereof, if any, being maintained as a
Base Rate Loan or a LIBO Rate Loan.

     “U.C.C.” means the Uniform Commercial Code as may be amended and in effect from time
to time in the State of New York; provided that if, with respect to any U.C.C. financing

35

 

statement or by reason of any provision of law, the perfection or the effect of perfection or
non-perfection of the security interests granted to the Administrative Agent pursuant to the
applicable Loan Document is governed by the Uniform Commercial Code as in effect in a jurisdiction
of the United States other than New York, U.C.C. means the Uniform Commercial Code as in effect
from time to time in such other jurisdiction for purposes of the provisions of each Loan Document
and any U.C.C. financing statement relating to such perfection or effect of perfection or
non-perfection.

     “United States” or “U.S.” means the United States of America and all States.

     “Unrestricted Subsidiary” means any Subsidiary of the Company that is designated by
the Board of Directors of the Company as an Unrestricted Subsidiary pursuant to a resolution of the
Board of Directors of the Company, but only to the extent that such Subsidiary:

     (a) has (or immediately after consummation of the designation of such Subsidiary as an
Unrestricted Subsidiary will have) no Indebtedness other than Non-Recourse Debt;

     (b) except as permitted by Section 7.2.12, is not party to any agreement,
contract, arrangement or understanding with the Company or any Restricted Subsidiary of the
Company unless the terms of any such agreement, contract, arrangement or understanding are,
in the good faith judgment of the Board of Directors of the Company no less favorable to the
Company or such Restricted Subsidiary than those that might be obtained at the time from
Persons who are not Affiliates of the Company;

     (c) is a Person with respect to which neither the Company nor any of its Restricted
Subsidiaries has any direct or indirect obligation (i) to subscribe for additional Capital
Securities or (ii) to maintain or preserve such Person’s financial condition; and

     (d) is not (or immediately after consummation of the designation of such Subsidiary as
an Unrestricted Subsidiary will not be) a guarantor of, or otherwise directly or indirectly
obligated to provide credit support, for the Senior Secured Notes, the Loans or any other
Indebtedness of the Borrowers or any Restricted Subsidiary.

     “Voting Stock” means, with respect to any Person, Capital Securities of any class or
kind ordinarily having the power to vote (directly or indirectly) for the election of directors,
managers, representatives or other voting members of the governing body of such Person.

     “Wholly-Owned Subsidiary” means, as to any Person, (a) any corporation 100% of whose
Capital Securities (other than any director’s qualifying shares or investments by foreign nationals
mandated by applicable laws) is at the time owned by such Person and/or one or more direct or
indirect Wholly-Owned Subsidiaries of such Person and (b) any partnership, limited liability
company, association or other entity in which such Person and/or one or more direct or indirect
Wholly-Owned Subsidiaries of such Person has a 100% equity interest at such time.

     SECTION 1.2. Use of Defined Terms. Unless otherwise defined or the context otherwise
requires, terms for which meanings are provided in this Agreement shall have such meanings when
used in each other Loan Document and the Disclosure Schedule.

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     SECTION 1.3. Cross-References. Unless otherwise specified, references in a Loan
Document to any Article or Section are references to such Article or Section of such Loan Document,
and references in any Article, Section or definition to any clause are references to such clause of
such Article, Section or definition.

     SECTION 1.4. Accounting and Financial Determinations. Unless otherwise specified, all
accounting terms used in each Loan Document shall be interpreted, and all accounting determinations
and computations hereunder or thereunder shall be made, in accordance with GAAP. Unless otherwise
expressly provided, all financial covenants and defined financial terms shall be computed on a
consolidated basis for the Borrowers, in each case without duplication.

ARTICLE II

TERMS OF COMMITMENTS AND LOANS

     SECTION 2.1. Commitments. Subject to the terms and conditions and relying on the
representations and warranties of the Borrowers in this Agreement (including Article V and
the other Loan Documents), each Lender and each Issuer severally agrees to make Credit Extensions
as set forth in this Section 2.1.

          2.1.1. Loan Commitments. From time to time on any Business Day occurring from and
after the Closing Date but prior to the Commitment Termination Date:

     (a) each Lender agrees that it will make revolving credit loans (relative to such
Lender, its “Revolving Credit Loans”) collectively to the Borrowers equal to such
Lender’s Percentage of the aggregate amount of each Borrowing of Revolving Credit Loans
requested by the Borrowers to be made on such day, subject to the limits set forth in
Section 2.1.3; and

     (b) the Swing Line Lender agrees that it will make loans (its “Swing Line
Loans”) collectively to the Borrowers equal to the principal amount of the Swing Line
Loan requested by the Borrowers to be made on such day, subject to the limits set forth in
Section 2.1.3. The Commitment of the Swing Line Lender to make Swing Line Loans as
provided in this Section 2.1 is herein referred to as its “Swing Line Loan
Commitment”.

On the terms and subject to the conditions of this Agreement, the Borrowers may from time to time
borrow, repay and reborrow Loans.

          2.1.2. Letter of Credit Commitment. From time to time on any Business Day occurring
from and after the Closing Date but prior to the Commitment Termination Date, each Issuer agrees
that it will (a) issue one or more documentary or standby letters of credit (each, a “Letter of
Credit”) for the account of any Borrower in the Stated Amount requested by such Borrower on
such day; or (b) extend the Stated Expiry Date of an existing standby Letter of Credit previously
issued hereunder. No Stated Expiry Date shall extend beyond the earlier of (i) the Commitment
Termination Date and (ii) unless otherwise agreed to by the relevant Issuer in its sole discretion,
one year from the date of such extension. No Issuer shall be permitted or required to issue any
Letter of Credit if, after giving effect thereto, (A) the aggregate amount of all Letter of Credit
Outstandings would exceed the Letter of Credit Commitment Amount or (B) the sum of (1) the
aggregate amount of all Letter of Credit Outstandings, plus (2) the aggregate

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principal amount of all Revolving Credit Loans then outstanding, plus (3) the
aggregate principal amount of all Swing Line Loans then outstanding, would exceed the then
applicable Maximum Loan Amount.

          2.1.3. Lenders Not Permitted or Required to Make Loans.

     (a) No Lender shall be required to, and no Borrower shall request any Lender to, make
any Revolving Credit Loan if, after giving effect thereto, (i) the sum of (A) the aggregate
outstanding principal amount of all the Revolving Credit Loans of all Lenders, plus
(B) the aggregate outstanding principal amount of all Swing Line Loans, plus (C) the
aggregate amount of all Letter of Credit Outstandings, would exceed the then applicable
Maximum Loan Amount; or (ii) the aggregate outstanding principal amount of all Revolving
Credit Loans of such Lender, plus such Lender’s Percentage of the aggregate
outstanding principal amount of all Swing Line Loans, plus such Lender’s Percentage
of the aggregate amount of all Letter of Credit Outstandings, would exceed such Lender’s
Percentage of the then applicable Maximum Loan Amount.

     (b) The Swing Line Lender shall not be permitted or required to, and no Borrower shall
be permitted to request the Swing Line Lender to, make any Swing Line Loan if, after giving
effect thereto, (i) the aggregate outstanding principal amount of all the Swing Line Loans
would exceed the then existing Swing Line Loan Commitment Amount or (ii) the aggregate
outstanding principal amount of all the Revolving Credit Loans of all Lenders, plus
the aggregate outstanding principal amount of all Swing Line Loans, plus the
aggregate amount of all Letter of Credit Outstandings, would exceed the then applicable
Maximum Loan Amount.

     SECTION 2.2. Reduction of the Commitment Amounts. Each of the Commitment Amounts is
subject to reduction from time to time pursuant to this Section 2.2.

          2.2.1. Optional. The Company may, from time to time on any Business Day occurring
after the Closing Date, voluntarily reduce the amount of the Revolving Credit Commitment Amount on
the Business Day so specified by the Company; provided, that any such reduction shall
require at least one Business Day’s prior notice to the Administrative Agent and be permanent, and
any partial reduction of the then applicable Revolving Credit Commitment Amount shall be in a
minimum amount of $1,000,000 and in an integral multiple of $500,000. Any optional reduction of
the then applicable Revolving Credit Commitment Amount pursuant to the terms of this Agreement
which reduces the then applicable Revolving Credit Commitment Amount below the sum of (i) the then
applicable Swing Line Loan Commitment Amount and (ii) the then applicable Letter of Credit
Commitment Amount shall result in an automatic and corresponding reduction of the then applicable
Swing Line Loan Commitment Amount and/or then applicable Letter of Credit Commitment Amount (as
directed by the Company in a notice to the Administrative Agent delivered together with the notice
of such voluntary reduction in the then applicable Revolving Credit Commitment Amount) to an
aggregate amount not in excess of the then applicable Revolving Credit Commitment Amount, as so
reduced, without any further action on the part of the Swing Line Lender or the Issuer.

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          2.2.2. Mandatory. Each of the Commitment Amounts shall be reduced as set forth below.

     (a) Each Commitment Amount shall, without any further action, automatically and
permanently be reduced on the Commitment Termination Date so that each Commitment Amount
equals $0.

     (b) Prior to the Commitment Termination Date, any mandatory reduction of the Revolving
Credit Commitment Amount pursuant to Section 3.1.1. or Section 3.1.2. or
otherwise which reduces the Revolving Credit Commitment Amount below the sum of (i) the
Letter of Credit Commitment Amount and (ii) the Swing Line Loan Commitment Amount shall
result in an automatic and corresponding reduction of the Letter of Credit Commitment Amount
and/or the Swing Line Loan Commitment Amount (as specified by the Company) to an aggregate
amount not in excess of the then applicable Revolving Credit Commitment Amount, as so
reduced, without any further action on the part of any Issuer or the Swing Line Lender.

          2.2.3. Termination of Agreement. The Borrowers may terminate this Agreement at any
time upon forty-five (45) days’ prior written notice to the Administrative Agent. Notwithstanding
anything to the contrary contained herein, all Obligations shall become immediately due and payable
and all Commitments shall automatically be deemed terminated as of any termination of this
Agreement, including any termination under Section 2.2, Section 3.1 or Section
8.2 and, pending a final accounting, the Administrative Agent may withhold any balances in the
Controlled Deposit Accounts and/or Concentration Account (unless supplied with an indemnity
satisfactory to the Administrative Agent) to cover all of the Obligations, including an amount
equal to 110% of the Stated Amount of any Letters of Credit outstanding with an expiry date on, or
within thirty (30) days of, the effective date of termination of this Agreement. In addition, all
of the Administrative Agent’s and the Lenders’ rights and Liens shall continue after any
termination of the Commitments or this Agreement until all outstanding Obligations have been paid
and satisfied in full.

     SECTION 2.3. Borrowing Procedures and Funding Maintenance. Revolving Credit Loans
shall be made by the Lenders in accordance with Section 2.3.1 and Swing Line Loans shall be
made by the Swing Line Lender in accordance with Section 2.3.2.

          2.3.1. Borrowing Revolving Credit Loans.

     (a) Whenever the Borrowers desire to make a Borrowing of Revolving Credit Loans
hereunder, they shall deliver a Borrowing Request to the Administrative Agent and following
such Borrowing Request, the Administrative Agent shall promptly notify each applicable
Lender thereof. All Borrowing Requests are irrevocable and must be made no later than (i)
12:00 noon, New York City time, the Business Day of a proposed Borrowing of Base Rate Loans,
and (ii) 12:00 noon, New York City time, three (3) Business Days prior to a proposed
Borrowing of LIBO Rate Loans and each Borrowing must be made in an aggregate amount of
$500,000 or any larger integral multiple of $100,000 or in the unused amount of the
Revolving Credit Commitment Amount; provided, that all initial Loans on the Closing
Date will be made as Base Rate Loans. No

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Borrowing Request shall be required, and the minimum aggregate amounts specified under
this Section 2.3.1 shall not apply, in the case of (A) charges to the Obligation
Account made pursuant to Section 3.1.5, (B) Revolving Credit Loans deemed made under
Section 2.6.2 in respect of unreimbursed Disbursements or (C) Revolving Credit Loans
made under clause (b) of Section 2.3.2 to refund Refunded Swing Line Loans.
On the terms and subject to the conditions of this Agreement, each Borrowing shall be in the
amounts, comprised of the Type of Loans (and in the case of LIBO Rate Loans, for the
Interest Period), and made on the Business Day, specified in such Borrowing Request.

     (b) Provided that a Borrower timely delivers a Borrowing Request in accordance with
Section 2.3.1(a) and subject to all other terms and conditions of this Agreement, on
or before 3:00 p.m., New York City time, on the same Business Day, in the case of Base Rate
Loans, or on the third Business Day, in the case of LIBO Rate Loans, each Lender shall
deposit with the Administrative Agent same day funds in an amount equal to such Lender’s
Percentage of the requested Borrowing. Such deposit will be made to an account which the
Administrative Agent shall specify from time to time by notice to the Lenders. To the
extent funds are received from the Lenders, the Administrative Agent shall promptly and in
any event prior to 4:00 p.m., New York City time, make such funds available to the Borrowers
by wire transfer to the account the Borrowers shall have specified in their Borrowing
Request. In the event that only one Lender fails to fund its Percentage of Loans as
required above prior to 4:00 p.m., New York City time, the Administrative Agent shall
(subject to the terms of this Agreement) advance such Loans (or such lesser amount as is
available pursuant to clause (b) of Section 2.1.3) required to be funded by
such Lender and such Loan shall be deemed to be a Swing Line Loan in the amount of such
advance. No Lender shall be responsible for any default by any other Lender in its
obligation to make Revolving Credit Loans under this Agreement, and each Lender shall be
obligated to make only Revolving Credit Loans provided to be made by it under this
Agreement, regardless of the failure of any other Lender to fulfill its Revolving Credit
Commitment hereunder.

     (c) In order to provide for the payment of all expenses described in clauses
(a), (b) and (c) of Section 10.3 and fees payable pursuant to
Section 3.3 and Article V (for distribution by Administrative Agent as
applicable) on the Closing Date which are not paid directly by the Borrowers on such date,
the Borrowers hereby agree to make Borrowings from the Lenders (consisting of Revolving
Credit Loans in amounts determined in accordance with their respective Percentages) on the
Closing Date, in such amount as is necessary to effect the payment of such expenses and
fees. The Borrowers further agree that the letters of credit outstanding under the Existing
Credit Agreement and listed on Schedule V (the “Existing Letters of Credit”)
shall not be replaced but shall be automatically deemed to have been issued under this
Agreement (and to have reduced the amount available to be borrowed under the then Revolving
Credit Commitment Amount by an amount equal to the aggregate undrawn and/or unreimbursed
amounts of or relating to such Existing Letters of Credit) effective as of the Closing Date.
The Borrowers hereby irrevocably instruct and authorize the Administrative Agent, on behalf
of the Lenders, to make such Credit Extensions available to the Borrowers on the Closing
Date by applying the proceeds of such Credit Extensions to the payment of such expenses,
fees and obligations (in accordance with the foregoing provisions of this clause 

40

 

(c)), and the Lenders hereby agree, on the terms and subject to the conditions
of this Agreement, to make such Credit Extensions to the Borrowers on such date for such
purposes and, to deem such Existing Letters of Credit to have been issued under this
Agreement for all purposes, without need for delivery by the Company of a Borrowing Request
or Issuance Request. The Borrowers acknowledge that no Issuer shall be required to issue
any Letters of Credit on account of the deemed issuance of the Existing Letters of Credit.

          2.3.2. Borrowing Swing Line Loans.

     (a) By telephonic notice, promptly followed (within one Business Day) by the delivery
of a confirming Borrowing Request, to the Swing Line Lender and the Administrative Agent on
or before 12:00 noon, New York City time, on the Business Day the proposed Swing Line Loan
is to be made, any Borrower may from time to time irrevocably request that a Swing Line Loan
be made by the Swing Line Lender in a minimum principal amount of $100,000 or any larger
integral multiple of $10,000. All Swing Line Loans shall be made as Base Rate Loans and
shall not be entitled to be converted into LIBO Rate Loans. Provided that a Borrower timely
requests a Swing Line Loan and subject to all other terms and conditions of this Agreement,
the proceeds of each Swing Line Loan shall be made available by the Swing Line Lender, by
3:00 p.m., New York City time, on the Business Day telephonic notice is received by it as
provided in this clause (a), to such Borrower by wire transfer to the account such Borrower
shall have specified in its notice therefor. The Borrowers hereby waive the right to
dispute the Administrative Agent’s record of the terms of any telephonic notice, absent
manifest error.

     (b) If (i) any Swing Line Loan, (A) shall be outstanding for more than four Business
Days or (B) is or will be outstanding on a date when any Borrower requests that a Revolving
Credit Loan be made or (ii) any Default shall occur and be continuing, each Lender (other
than the Swing Line Lender) irrevocably agrees that it will, at the request of the Swing
Line Lender (and at the discretion of the Swing Line Lender) and upon notice from the
Administrative Agent, make a Revolving Credit Loan (which shall initially be funded as a
Base Rate Loan) in an amount equal to such Lender’s Percentage of the aggregate principal
amount of all such Swing Line Loans then outstanding (such outstanding Swing Line Loans
hereinafter referred to as the “Refunded Swing Line Loans”). On or before 12:00
noon, New York City time on the first Business Day following receipt by each Lender of a
request to make Revolving Credit Loans as provided in the preceding sentence, each such
Lender shall deposit in an account specified by the Swing Line Lender the amount so
requested in same day funds and such funds shall be applied by the Swing Line Lender to
repay the Refunded Swing Line Loans. At the time the Lenders make the above referenced
Revolving Credit Loans, the Swing Line Lender shall be deemed to have made, in consideration
of the making of the Refunded Swing Line Loans, a Revolving Credit Loan in an amount equal
to the Swing Line Lender’s Percentage of the aggregate principal amount of the Refunded
Swing Line Loans. Upon the making (or deemed making, in the case of the Swing Line Lender)
of any Revolving Credit Loans pursuant to this clause (b), the amount so funded
shall become outstanding under such Lender’s Revolving Credit Loans and shall no longer be

41

 

owed under the Swing Line Lender’s Swing Line Loans. All interest payable with respect
to any Revolving Credit Loans made (or deemed made, in the case of the Swing Line Lender)
pursuant to this clause (b) shall be appropriately adjusted to reflect the period of
time during which the Swing Line Lender had outstanding Swing Line Loans in respect of which
such Revolving Credit Loans were made.

     (c) If, at any time prior to the making of Revolving Credit Loans to replace any
outstanding Swing Line Loans pursuant to clause (b) of this Section 2.3.2,
any Lender is stayed or otherwise prohibited by any Governmental Authorities from making
such a Revolving Credit Loan, each Lender with a Revolving Credit Commitment (other than the
Swing Line Lender) irrevocably agrees that it will, at the request of the Swing Line Lender
and upon notice from the Administrative Agent, purchase an undivided participation interest
in all such Swing Line Loans in an amount equal to its Percentage of the aggregate
outstanding amount of such Swing Line Loans and transfer immediately to an account
identified by the Swing Line Lender, in immediately available funds, the amount of its
participation. The Swing Line Lender will deliver to each such Lender, promptly following
receipt of such funds, a participation certificate, dated the date of receipt of such funds
and in the amount of such Lender’s participation if requested to do so by such Lender.

     (d) Each Borrower expressly agrees that, in respect of each Lender’s funded
participation interest in any Swing Line Loan, such Lender shall be deemed to be in privity
of contract with each Borrower and have the same rights and remedies against each Borrower
under the Loan Documents as if such funded participation interest in such Swing Line Loan
were a Revolving Credit Loan.

     (e) Each Lender’s obligation to make Revolving Credit Loans or purchase participation
interests in Swing Line Loans, as contemplated by clause (b) or (c) of this
Section 2.3.2, shall be absolute and unconditional and without recourse to the Swing
Line Lender and shall not be affected by any circumstance, including (i) any set-off,
counterclaim, recoupment, defense or other right which such Lender may have against the
Swing Line Lender, any Borrower or any other Person for any reason whatsoever, (ii) the
occurrence or continuance of a Default, an Event of Default or a Material Adverse Effect,
(iii) the acceleration or maturity of any Loans or the termination of any Commitment after
the making of any Swing Line Loan, (iv) any breach of this Agreement or any other Loan
Document by any Person, or (v) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing.

          2.3.3. Joint and Several Liability; Rights of Contribution. Each Borrower
acknowledges and agrees that: (i) pursuant to this Agreement, the Borrowers desire to utilize
their borrowing potential on a consolidated basis; (ii) each Borrower has determined that it will
benefit specifically and materially from the Credit Extensions contemplated by this Agreement;
(iii) it is both a condition precedent to the obligations of the Administrative Agent and the
Lenders hereunder and a desire of each Borrower that each Borrower execute and deliver to the
Lenders this Agreement and the other Loan Documents to which it is a party; and (iv) each Borrower
has requested and bargained for the structure and terms of and security for the Credit Extensions
contemplated by this Agreement and the other Loan Documents.

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     (a) Each Borrower hereby irrevocably and unconditionally: (i) agrees that it is jointly
and severally liable to the Administrative Agent and the Lenders for the full and prompt
payment and performance of the Obligations of each Borrower under this Agreement and each
other Loan Document notwithstanding that such Loan Document may specify that a particular
Borrower is responsible for a given payment or performance; (ii) agrees to fully and
promptly perform all of its obligations hereunder with respect to each Credit Extension made
hereunder as if such Credit Extension had been made directly to it; and (iii) agrees as a
primary obligation to indemnify the Administrative Agent and each Lender, on demand, for and
against any loss incurred by the Administrative Agent or any Lender as a result of any of
the Obligations of any Borrower (the “subject Borrower”) being or becoming void,
voidable, unenforceable or ineffective for any reason whatsoever, whether or not known to
the subject Borrower or any other Person, the amount of such loss being the amount which the
Administrative Agent or the Lenders (or any of them) would otherwise have been entitled to
recover from such subject Borrower.

     (b) It is the intent of each Borrower that the indebtedness, obligations and
liabilities under this Agreement of no one of them be subject to challenge on any basis
related to any federal or state law dealing with fraudulent conveyances or any other law
related to transfers for less than fair or reasonably equivalent value. Accordingly, as of
the date hereof, the liability of each Borrower under this Section 2.3.3, together
with all of its other liabilities to all Persons as of the date hereof and as of any other
date on which a transfer is deemed to occur by virtue of this Agreement, calculated in
amounts sufficient to pay its probable net liabilities on its existing indebtedness as the
same become absolute and matured (“Dated Liabilities”) is and is to be, less than
the amount of the aggregate of a fair valuation of its property as of such corresponding
date (“Dated Assets”). To this end, each Borrower under this Section 2.3.3
(i) grants to and recognizes in each other Borrower ratably, rights of subrogation and
contribution in the amount, if any, by which the Dated Assets of such Borrower, but for the
aggregate of subrogation and contribution in its favor recognized herein, would exceed the
Dated Liabilities of such Borrower or Borrowers, as the case may be, and (ii) acknowledges
receipt of and recognizes its right to subrogation and contribution ratably from the other
Borrowers in the amount, if any, by which the Dated Liabilities of such Borrower, but for
the aggregate of subrogation and contribution in its favor recognized herein, would exceed
the Dated Assets of such Borrower under this Section 2.3.3. In recognizing the
value of the Dated Assets and the Dated Liabilities, it is understood that each Borrower
will recognize, to at least the same extent of their aggregate recognition of liabilities
hereunder, their rights to subrogation and contribution hereunder. It is a material
objective of this Section 2.3.3 that each Borrower recognizes rights to subrogation
and contribution rather than be deemed to be insolvent (or in contemplation thereof) by
reason of an arbitrary interpretation of its joint and several obligations hereunder.

     (c) Each Borrower agrees and acknowledges that the present structure of the credit
facilities detailed in this Agreement is based in part upon the financial and other
information presently known to the Administrative Agent and the Lenders regarding each
Borrower, the corporate or other organizational structure of each Borrower and the present
financial condition of each Borrower. Upon the occurrence of an Event of

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Default and so long as it is continuing, each Borrower hereby agrees that the Required
Lenders shall have the right, in their sole credit judgment, to require that any or all of
the following changes be made to the credit facilities contemplated in this Agreement: (i)
restrict loans and advances between the Borrowers, (ii) establish separate Controlled
Deposit Accounts, Concentration Accounts and/or Obligation Accounts for each Borrower, (iii)
separate the Revolving Credit Loans, Swing Line Loans and Letters of Credit into separate
Revolving Credit Loans, Swing Line Loans and Letters of Credit to each of the Borrowers as
shall be determined by the Required Lenders and (iv) establish such other procedures as
shall be reasonably deemed by the Required Lenders to be useful in tracking where Revolving
Credit Loans, Swing Line Loans and Letters of Credit are made under this Agreement and the
source of payments received by the Lenders on such Credit Extensions.

     (d) Each of the Borrowers hereby irrevocably and unconditionally agrees that it is
jointly and severally obligated in respect of all Credit Extensions and other Obligations
(including Letter of Credit Obligations), and that the aggregate amount of credit available
hereunder to any of the Borrowers at any time shall be determined by taking into account all
Letters of Credit Outstandings and all Loans outstanding, regardless of which of the
Borrowers may be the beneficiary of any Letters of Credit or received the proceeds of any of
the Borrowings. By executing this Agreement each of the Borrowers confirms to the other
parties to this Agreement that the Company shall (and is hereby duly appointed by each of
the Borrowers to) act as agent for the Borrowers for all purposes of requesting Loans and
Letters of Credit, for purposes of allocation (to the extent permitted herein) of Letters of
Credit and the proceeds of Loans, and for all other purposes of this Agreement pursuant to
any provision identifying the Borrowers or any of them to take any action or receive any
communication (regarding uses and the availability of credit hereunder, and otherwise).
Each of the Borrowers further agrees that each of the Lenders and the Administrative Agent
shall be entitled to deal as to these matters only with the Company and (to the extent
contemplated herein) to act as to these matters in accordance with instructions or other
communications from the Company. Neither the Lenders nor the Administrative Agent shall
have any responsibility to any Borrower for acting as provided in this provision, and the
Obligations of each of the Borrowers to the Administrative Agent or the Lenders shall not be
affected by any matter relating to acts or omissions of the Company relating to Credit
Extensions or otherwise as agent for the Borrowers hereunder.

     SECTION 2.4. Continuation and Conversion Elections. By delivering a
Continuation/Conversion Notice to the Administrative Agent on or before 12:00 noon, New York City
time, on a Business Day, the Company may from time to time irrevocably elect, on not less than one
Business Day’s notice (in the case of a conversion of LIBO Rate Loans to Base Rate Loans) or three
Business Days’ notice (in the case of a continuation of LIBO Rate Loans or a conversion of Base
Rate Loans into LIBO Rate Loans) nor more than five Business Days’ notice (in the case of any
Loans) that all, or any portion in a minimum amount of $500,000 or an integral multiple of
$100,000, of any Loans be, in the case of Base Rate Loans, converted into LIBO Rate Loans or, in
the case of LIBO Rate Loans, be converted into Base Rate Loans or continued as LIBO Rate Loans (in
the absence of delivery of a Continuation/Conversion Notice with respect to any LIBO Rate Loan at
least three Business Days (but not more than five

44

 

Business Days) before the last day of the then current Interest Period with respect thereto,
such LIBO Rate Loan shall, on such last day, automatically convert to a Base Rate Loan);
provided, however, that (a) each such conversion or continuation shall be pro rated
among the applicable outstanding Loans of all Lenders and (b) no portion of the outstanding
principal amount of any Loans may be continued as, or be converted into, LIBO Rate Loans when any
Default has occurred and is continuing.

     SECTION 2.5. Funding. Each Lender may, if it so elects, fulfill its obligation to
make, continue or convert LIBO Rate Loans hereunder by causing one of its foreign branches or
Affiliates (or an international banking facility created by such Lender) to make or maintain such
LIBO Rate Loan; provided, however, that such LIBO Rate Loan shall nonetheless be
deemed to have been made and to be held by such Lender, and the joint and several obligation of the
Borrowers to repay such LIBO Rate Loan shall nevertheless be to such Lender for the account of such
foreign branch, Affiliate or international banking facility.

     SECTION 2.6. Letter of Credit Issuance Procedures. By delivering to an Issuer and the
Administrative Agent an Issuance Request on or before 12:00 noon, New York City time, on a Business
Day, the Company may, from time to time irrevocably request, on not less than three nor more than
ten Business Days’ notice (or such shorter or longer notice as may be acceptable to such Issuer),
in the case of an initial issuance of a Letter of Credit, and not less than three nor more than ten
Business Days’ notice (unless a shorter or longer notice period is acceptable to such Issuer) prior
to the then existing Stated Expiry Date of a Letter of Credit, in the case of a request for the
extension of the Stated Expiry Date of a Letter of Credit, that such Issuer issue, or extend the
Stated Expiry Date of, as the case may be, an irrevocable Letter of Credit on behalf of any
Borrower in such form as may be requested by the Borrowers and approved by such Issuer;
provided, however, that no extension of the Stated Expiry Date of an outstanding
Letter of Credit may provide for a Stated Expiry Date subsequent to the earlier of (a) the
Commitment Termination Date and (b) one year from the date of such extension. Notwithstanding
anything to the contrary contained herein or in any separate application for any Letter of Credit,
each Borrower hereby jointly and severally acknowledges and agrees that it shall be obligated to
reimburse the applicable Issuer upon each Disbursement paid under a Letter of Credit, and it shall
be deemed to be the obligor for purposes of each such Letter of Credit issued hereunder (whether
the account party on such Letter of Credit is such Borrower or any other Borrower). Upon timely
receipt of an Issuance Request and subject to all other terms and conditions of this Agreement, the
Administrative Agent shall promptly notify the relevant Issuer and each Lender thereof and shall
cause: (i) the Letter of Credit requested by the Issuance Request to be issued and (ii) the
relevant Issuer to (A) comply with the terms and conditions of this Agreement relating to the
Letter of Credit and (B) to fulfill the duties and obligations of an Issuer hereunder. Each Letter
of Credit shall by its terms be stated to expire on a date (each, a “Stated Expiry Date”)
no later than one year from the date of its issuance.

          2.6.1. Other Lenders’ Participation. (a) Upon the issuance of each Letter of Credit
issued by an Issuer pursuant hereto, and without further action, each Lender (other than the
Issuer) that has a Revolving Credit Commitment shall be deemed to have irrevocably purchased from
the Issuer, to the extent of its Percentage of each such Letter of Credit, and the Issuer shall be
deemed to have irrevocably granted and sold to each such Lender a participation interest in each
such Letter of Credit (including the Contingent Liability and any Reimbursement

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Obligation and all rights with respect thereto), and each such Lender shall, to the extent of
its Percentage of each such Letter of Credit, be responsible for reimbursing promptly (and in any
event within one Business Day) the Issuer for Reimbursement Obligations which have not been
reimbursed by the Borrowers in accordance with Section 2.6.2 and Section 2.6.3. In
addition, each such Lender shall, to the extent of its Percentage of each such Letter of Credit, be
entitled to promptly receive a ratable portion of the Letter of Credit fees payable pursuant to
Section 3.3.3 with respect to each Letter of Credit and of interest payable pursuant to
Section 3.2 with respect to any Reimbursement Obligation. To the extent that any Lender
has reimbursed the Issuer for a Disbursement as required by this Section 2.6.1 and
Section 2.6.2, such Lender shall be entitled to receive its ratable portion of any amounts
subsequently received (from the Borrowers or otherwise) in respect of such Disbursement.

     (b) Each Lender’s obligation to reimburse the Issuer and purchase participation
interests in Letters of Credit, as contemplated by this Section 2.6.1, Section
2.6.2 and Section 2.6.3, shall be absolute and unconditional and without
recourse to the Issuer and shall not be affected by any circumstance, including (i) any
set-off, counterclaim, recoupment, defense or other right which such Lender may have against
the Issuer, any Borrower or any other Person for any reason whatsoever, (ii) the occurrence
or continuance of a Default, an Event of Default or a Material Adverse Effect, (iii) the
acceleration or maturity of any Loans or the termination of any Commitment after the
issuance of a Letter of Credit, (iv) any breach of this Agreement or any other Loan Document
by any Person, or (v) any other circumstance, happening or event whatsoever, whether or not
similar to any of the foregoing.

          2.6.2. Disbursements: Conversion to Loans. The Issuer will notify the Company and the
Administrative Agent promptly of the presentment for payment of any drawing under any Letter of
Credit issued by the Issuer, together with notice of the date (the “Disbursement Date”)
such payment is required to be made (each such payment, a “Disbursement”); provided
that the failure of an Issuer to give such notice shall not affect the Reimbursement Obligations of
the Borrowers hereunder. Subject to the terms and provisions of such Letter of Credit, the Issuer
shall make such payment to the beneficiary (or its designee) of such Letter of Credit on the
Disbursement Date. Immediately, and in any event prior to 12:00 noon, New York City time, on the
Disbursement Date, the Borrowers will (jointly and severally) reimburse the Administrative Agent,
for the account of the Issuer, for all amounts which the Issuer has disbursed under such Letter of
Credit, without presentment, demand, protest or other formalities of any kind. Unless a Borrower
has notified the Administrative Agent no later than one Business Day prior to the Disbursement Date
that it will reimburse the Issuer for the applicable Disbursement with funds other than the
proceeds of Revolving Credit Loans or delivered to the Administrative Agent a Borrowing Request for
Revolving Credit Loans in an amount equal to such Disbursement, the Borrowers will be deemed to
have given a Borrowing Request to the Administrative Agent requesting that the Lenders make
Revolving Credit Loans which shall be Base Rate Loans on the Disbursement Date in an amount equal
to such Disbursement (or lesser amount if the aggregate amount of the Revolving Credit Loans
available pursuant to Section 2.1.3 is less than the Disbursement); provided, that,
such Revolving Credit Loans shall be subject to (A) the satisfaction of the conditions in
Article V and (B) the existence of Revolving Credit Loan availability pursuant to
Section 2.1.3 hereof (after giving effect to repayment of the applicable Reimbursement
Obligations with the proceeds of the proposed

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Revolving Credit Loans). Subject to the preceding sentence, if so requested by the
Administrative Agent, each of the Lenders shall, on the date of such Disbursement, make such
Revolving Credit Loans in an amount equal to such Lender’s Percentage of such Borrowing or the
aggregate amount of the Revolving Credit Loans available pursuant to Section 2.1.3, as
applicable, the proceeds of which shall be applied directly by the Administrative Agent to
reimburse the applicable Issuer to the extent of such proceeds. If the Borrowers fail to reimburse
the applicable Issuer as provided above for any reason, including failure to satisfy the conditions
of Article V or insufficient unused Revolving Credit Loan availability pursuant to
Section 2.1.3, such Issuer shall promptly notify the Administrative Agent and the
Administrative Agent shall notify each Lender of the unreimbursed amount of such Disbursement and
of such Lender’s respective participation therein based on such Lender’s Percentage. Each Lender
will pay to the Administrative Agent for the account of the applicable Issuer on the date of such
notice, in immediately available funds, an amount equal to such Lender’s Percentage of such
unreimbursed Disbursement (or, if such notice is made after 1:00 p.m. (New York, New York time) on
such date, on the next succeeding Business Day). If any Lender fails to make available to such
Issuer, in immediately available funds, the amount of such Lender’s Percentage in such unreimbursed
Disbursement as provided in this Section 2.6.2, such Issuer shall be entitled to recover
such amount on demand from such Lender together with interest at the Federal Funds Rate for one
Business Day and thereafter at the Base Rate for each day such amount remains unpaid to the Issuer.
Nothing in this Section 2.6.2 shall be deemed to prejudice the right of any Lender to
recover from such Issuer any amounts made available by such Lender to such Issuer pursuant to this
Section 2.6.2 if it is determined by a court of competent jurisdiction that the payment
with respect to a Letter of Credit by such Issuer was wrongful and such wrongful payment was the
result of gross negligence or willful misconduct on the part of such Issuer. The applicable Issuer
shall pay to the Administrative Agent, and the Administrative Agent to each Lender, such Lender’s
Percentage of all amounts received from the Borrowers for payment, in whole or in part, of the
Reimbursement Obligations in respect of any Letter of Credit, but only to the extent such Lender
has made payment to such Issuer in respect of such Letter of Credit pursuant to this Section
2.6.2.

          2.6.3. Reimbursement. The joint and several obligation (a “Reimbursement
Obligation”) of the Borrowers under Section 2.6.2 to reimburse the Issuer with respect
to each Disbursement (including interest thereon) not converted into Revolving Credit Loans
constituting a Base Rate Loan pursuant to Section 2.6.2, and, upon such Borrower failing to
reimburse the Issuer and the giving of notice thereof by the Administrative Agent to the Lenders,
each Lender’s obligation under Section 2.6.1 and Section 2.6.2 to reimburse the
Issuer or fund its Percentage of any unreimbursed Disbursement converted into a Base Rate Loan,
shall be absolute and unconditional under any and all circumstances and irrespective of any setoff,
counterclaim or defense to payment which any Borrower or such Lender, as the case may be, may have
or have had against the Issuer or any such Lender, including any defense based upon the failure of
any Disbursement to conform to the terms of the applicable Letter of Credit or any non-application
or misapplication by the beneficiary of the proceeds of such Letter of Credit or any other reason
whatsoever, including those set forth in clause (b) of Section 2.6.5 below;
provided, however, that after paying in full its Reimbursement Obligation (or, in
the case of the Lenders, their Percentage of such Reimbursement Obligation) hereunder, nothing
herein shall adversely affect the right of any Borrower or Lender, as the case may be, to commence
any proceeding against the Issuer for any wrongful Disbursement made by the Issuer under a Letter

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of Credit as a result of acts or omissions constituting gross negligence or willful misconduct
on the part of the Issuer.

          2.6.4. Deemed Disbursements. Upon the occurrence and during the continuation of any
Event of Default, after notice from the Administrative Agent, (a) an amount equal to all Letter of
Credit Outstandings shall, without demand upon or notice to any Borrower or any other Person, be
deemed to be due and payable to the Issuer (notwithstanding that such amount may not in fact have
been so paid or disbursed); and (b) each Borrower shall be immediately jointly and severally
obligated to Cash Collateralize all Letter of Credit Outstandings. At such time as the Event of
Default giving rise to the obligation to Cash Collateralize all Letter of Credit Outstanding
hereunder shall have been cured or waived, the Administrative Agent shall return all amounts then
on deposit with the Administrative Agent pursuant to this Section 2.6.4 to the Company,
together with accrued interest at the Federal Funds Rate, which have not been applied to the
satisfaction of such Obligations.

          2.6.5. Additional Letter of Credit Provisions.

     (a) The issuance by the applicable Issuer of each Letter of Credit shall, in addition
to the conditions precedent set forth in Article V, be subject to the conditions
precedent that such Letter of Credit shall be in the form and contain such terms as shall be
reasonably satisfactory to such Issuer, and that the Borrowers shall have executed and
delivered such other instruments and agreements relating to the Letter of Credit as such
Issuer shall have reasonably requested and that are not inconsistent with the terms of this
Agreement, including the applicable Bank’s Application therefor. In the event of a conflict
between the terms of this Agreement and the terms of any Application, the terms of this
Agreement shall control.

     (b) EACH BORROWER AND, TO THE EXTENT SET FORTH IN SECTION 2.6.1, SECTION
2.6.2 AND SECTION 2.6.3, EACH LENDER, SHALL ASSUME ALL RISKS OF THE ACTS AND
OMISSIONS OF OR MISUSE OF THE LETTERS OF CREDIT ISSUED BY SUCH ISSUER BY THE RESPECTIVE
BENEFICIARIES OF SUCH LETTER OF CREDIT. IN FURTHERANCE AND NOT IN LIMITATION OF THE
FOREGOING, SUCH ISSUER SHALL NOT BE RESPONSIBLE: (1) FOR THE FORM VALIDITY, SUFFICIENCY,
ACCURACY, GENUINENESS OR LEGAL EFFECT OF ANY DOCUMENT SUBMITTED BY ANY PERSON IN CONNECTION
WITH THE APPLICATION FOR OR ISSUANCE OF SUCH LETTERS OF CREDIT, EVEN IF IT SHOULD IN FACT
PROVE TO BE IN ANY OR ALL RESPECTS INVALID, INSUFFICIENT, INACCURATE, FRAUDULENT OR FORGED;
(2) FOR THE VALIDITY OR SUFFICIENCY OF ANY INSTRUMENT TRANSFERRING OR ASSIGNING OR
PURPORTING TO TRANSFER OR ASSIGN ANY SUCH LETTER OF CREDIT OR THE RIGHTS OR BENEFITS
THEREUNDER OR PROCEEDS THEREOF, IN WHOLE OR IN PART, WHICH MAY PROVE TO BE INVALID OR
INEFFECTIVE FOR ANY REASON; (3) FOR ERRORS, OMISSIONS, INTERRUPTIONS OR DELAYS IN
TRANSMISSION OR DELIVERY OF ANY MESSAGES, BY MAIL, CABLE, TELEGRAPH, TELEX OR OTHERWISE,
WHETHER OR NOT THEY ARE IN CIPHER; (4) FOR ERRORS IN

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INTERPRETATION OF TECHNICAL TERMS; (5) FOR ANY LOSS OR DELAY IN THE TRANSMISSION OR
OTHERWISE OF ANY DOCUMENT REQUIRED IN ORDER TO MAKE A DRAWING UNDER ANY SUCH LETTER OF
CREDIT OR OF THE PROCEEDS THEREOF; (6) FOR THE MISAPPLICATION BY THE BENEFICIARY OF ANY SUCH
LETTER OF CREDIT OF THE PROCEEDS OF ANY DRAWING UNDER SUCH LETTER OF CREDIT; AND (7) FOR ANY
CONSEQUENCES ARISING FROM CAUSES BEYOND THE CONTROL OF SUCH ISSUER, INCLUDING THE ACTIONS OF
ANY GOVERNMENTAL AUTHORITY. NONE OF THE ABOVE SHALL AFFECT, IMPAIR, OR PREVENT THE VESTING
OF ANY OF SUCH ISSUER’S RIGHTS OR POWERS HEREUNDER. ANY ACTION TAKEN OR OMITTED TO BE TAKEN
BY ANY ISSUER IN GOOD FAITH (AND NOT CONSTITUTING GROSS NEGLIGENCE OR WILLFUL MISCONDUCT)
SHALL BE BINDING UPON EACH BORROWER AND EACH LENDER, AND SHALL NOT PUT THE ISSUER UNDER ANY
RESULTING LIABILITY TO ANY BORROWER OR ANY LENDER AS THE CASE MAY BE. NOTWITHSTANDING
ANYTHING TO THE CONTRARY CONTAINED IN CLAUSE (7) ABOVE, NEITHER THE BORROWERS NOR ANY LENDER
SHALL HAVE ANY OBLIGATION TO INDEMNIFY ANY ISSUER IN RESPECT OF ANY LIABILITY INCURRED BY
SUCH ISSUER ARISING SOLELY OUT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH ISSUER,
AS DETERMINED BY A FINAL NON-APPEALABLE JUDGMENT OF A COURT OF COMPETENT JURISDICTION.

     (c) Each Issuer will send to the Company and the Administrative Agent immediately upon
issuance of any Letter of Credit, or an amendment thereto, a true and complete copy of such
Letter of Credit, or such amendment thereto. Upon issuance of any Letter of Credit or an
amendment thereto, the Administrative Agent shall promptly notify each Lender of the terms
of such Letter of Credit or amendment thereto, and of such Lender’s Percentage of the amount
of such Letter of Credit or amendment thereto, and the Administrative Agent shall provide to
each Lender a copy of such Letter of Credit or such amendment thereto. Upon cancellation or
termination of any Letter of Credit, the applicable Issuer shall promptly notify the
Administrative Agent and the Company, and the Administrative Agent will then promptly notify
each Lender of such cancellation or termination.

     SECTION 2.7. Register; Notes; Obligation Account; Reserves.

     (a) Each Lender may maintain in accordance with its usual practice an account or
accounts evidencing the Indebtedness of the Borrowers to such Lender resulting from each
Loan made by such Lender, including the amounts of principal and interest payable and paid
to such Lender from time to time hereunder. In the case of a Lender that does not request,
pursuant to clause (b)(ii) of this Section 2.7, execution and delivery of a
Note evidencing the Loans made by such Lender to the Borrowers, such account or accounts
shall, to the extent not inconsistent with the notations made by the Administrative Agent in
the Register, be conclusive and binding on each Borrower absent

49

 

manifest error; provided, however, that the failure of any Lender to
maintain such account or accounts shall not limit or otherwise affect any Obligations.

     (b) (i) Each Borrower hereby designates the Administrative Agent to serve as the
Borrowers’ agent, solely for the purpose of this clause (b), to maintain a register
(the “Register”) on which the Administrative Agent will record each Lender’s
Commitment, the Loans made by each Lender and each repayment in respect of the principal
amount of the Loans of each Lender and annexed to which the Administrative Agent shall
retain a copy of each Lender Assignment Agreement delivered to the Administrative Agent
pursuant to Section 10.11.1. Failure to make any recordation, or any error in such
recordation, shall not affect any Obligations. The entries in the Register shall be
conclusive, in the absence of manifest error, and the Borrowers, the Administrative Agent
and the Lenders shall treat each Person in whose name a Loan (and as provided in clause
(b)(ii) of this Section 2.7, the Note evidencing such Loan, if any) is
registered as the owner thereof for all purposes of this Agreement, notwithstanding notice
or any provision herein to the contrary. A Lender’s Commitment and the Loans made pursuant
thereto may be assigned or otherwise transferred in whole or in part only by registration of
such assignment or transfer in the Register. Any assignment or transfer of a Lender’s
Commitment or the Loans made pursuant thereto shall be registered in the Register only upon
delivery to the Administrative Agent of a Lender Assignment Agreement duly executed by the
Assignor thereof. No assignment or transfer of a Lender’s Commitment or the Loans made
pursuant thereto shall be effective unless such assignment or transfer shall have been
recorded in the Register by the Administrative Agent as provided in this Section
2.7.

     (ii) Each Borrower agrees that, upon written request to the Administrative Agent by any
Lender, each Borrower will execute and deliver to such Lender, as applicable, a Note
evidencing the Loans made by such Lender. Each Borrower hereby irrevocably authorizes each
Lender to make (or cause to be made) appropriate notations on the grid attached to such
Lender’s Notes (or on any continuation of such grid), which notations, if made, shall
evidence, inter alia, the date of, the outstanding principal amount of, and the
interest rate and Interest Period applicable to the Loans evidenced thereby. Such notations
shall, to the extent not inconsistent with the notations made by the Administrative Agent in
the Register, be conclusive and binding on the Borrowers absent manifest error;
provided, however, that the failure of any Lender to make any such notations
shall not limit or otherwise affect any Obligations. Subject to the provisions of
Section 10.11.1, a Note and the obligation evidenced thereby may be assigned or
otherwise transferred in whole or in part only by registration of such assignment or
transfer of such Note and the obligation evidenced thereby in the Register. Any assignment
or transfer of all or part of an obligation evidenced by a Note shall be registered in the
Register only upon delivery to the Administrative Agent of a Lender Assignment Agreement
duly executed by the assignor thereof and the compliance by the parties thereto with the
other requirements of Section 10.11.1, and thereupon, if requested by the assignee,
one or more new Notes shall be issued to the designated assignee. No assignment of a Note
and the obligation evidenced thereby shall be effective unless it shall have been recorded
in the Register by the Administrative Agent as provided in this Section 2.7.

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     (c) In order to utilize the collective borrowing powers of the Borrowers in the most
efficient and economical manner, and in order to facilitate the handling of the accounts of
the Borrowers on the Administrative Agent’s books, the Borrowers have requested, and the
Administrative Agent has agreed (subject to the provisions of clause (d) of
Section 2.3.3) to handle accounts of the Borrowers on the Administrative Agent’s
books on a combined basis, all in accordance with the following provisions:

     (i) In lieu of maintaining separate accounts on the Administrative Agent’s
books in the name of each of the Borrowers, the Administrative Agent shall maintain
one account under the name of the Company (the “Obligation Account”).
Credit Extensions made by the Lenders or any Issuer to the Borrowers or any of them
will be charged to the Obligation Account, along with any and all fees, charges,
expenses, indemnities or any other monies due under any Loan Document. The
Obligation Account will be credited with all amounts received by the Administrative
Agent from any of the Borrowers or from others for their account, including all
amounts received by the Administrative Agent in payment of the applicable
Obligations.

     (ii) Each month the Administrative Agent will render to the Company one extract
of the Obligation Account, which shall be deemed to be an account stated as to each
of the Borrowers and which will be deemed correct and accepted by all of the
Borrowers unless the Administrative Agent receives a written statement of exceptions
from them within 30 days after such extract has been rendered by the Administrative
Agent. Each of the Borrowers agrees that the Administrative Agent and the Lenders
as applicable, shall have no obligation to account separately to any of the
Borrowers.

     (iii) In furtherance of the provisions set forth in Section 2.3.3,
requests for Loans may be made by the Company as agent for the Borrowers and the
Administrative Agent is hereby authorized and directed to accept, honor and rely on
such instructions and requests, subject to the terms, conditions and provisions set
forth in this Agreement. Each of the Borrowers agrees that the Administrative Agent
shall have no responsibility to inquire into the correctness of the apportionment,
allocation or disposition of (A) any Credit Extensions made to any of the Borrowers
or (B) any of the Administrative Agent’s or any other Lender’s expenses and charges
relating thereto. All Credit Extensions are made for the Obligation Account.

     (iv) Each Borrower hereby states, acknowledges and agrees (A) that the handling
of the accounts of the Borrowers in a combined fashion is done solely as an
accommodation to the Borrowers and at their request, and that neither the
Administrative Agent nor any Lender shall incur any liability to the Borrowers as a
result hereof and (B) that each of the Borrowers requested and bargained for the
structure and terms of and security for the advances contemplated by this Agreement
and expects to derive benefit specifically and materially from the advances of
credit contemplated by this Agreement, directly or indirectly, and from such
availability.

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     (d) Each Borrower and each Lender hereby agree with the Administrative Agent and each
other Lender that, on each date on which any payment of interest, fees, principal or other
amounts are due and owing under this Agreement or under any of the other Loan Documents, the
Administrative Agent may, in its sole discretion, but without any obligation to do so and
subject to all other terms of this Agreement (other than any of the conditions in
Article V or any request for delivery of a Borrowing Request) cause a Borrowing of
Revolving Credit Loans (which shall be Base Rate Loans) to be made on such date in an amount
sufficient to satisfy in full all such payments of interest, fees, principal or other
amounts which are then due hereunder, and, subject to Section 4.7 and Section
9.2, the Administrative Agent shall disburse the proceeds of such Borrowing to each
Lender to satisfy all such Obligations which are then due and the Administrative Agent shall
give the Borrowers notice of such advances.

     (e) Without limiting any other rights or remedies of the Administrative Agent or any of
the Secured Parties under any Loan Document, all Loans and Letters of Credit otherwise
available to the Borrowers shall be subject to the Administrative Agent’s continuing right,
in its sole discretion, to establish an Availability Reserve.

ARTICLE III

PAYMENTS; PREPAYMENTS; INTEREST AND FEES

     SECTION 3.1. Payments; Application; Controlled Deposit Accounts; Power of Attorney;
Charges to Obligation Account; No Discharge. Each Borrower hereby unconditionally, jointly and
severally, promises to pay to the Administrative Agent for the account of each Lender, the then
unpaid principal amount of each Loan and all unpaid and outstanding Reimbursement Obligations and
to Cash Collateralize all outstanding Letters of Credit, in each case on the Maturity Date (or such
earlier date on which the Obligations become due and payable pursuant to Article VIII).
The Borrowers hereby further, jointly and severally, agree to pay interest on the unpaid
Obligations from time to time outstanding from the date hereof until payment in full thereof at the
rates per annum, and on the dates, set forth in Section 3.2. In addition, the Borrowers
agree that the Loans shall be repaid and prepaid pursuant to the following terms.

          3.1.1. Repayments and Prepayments. The Borrowers shall jointly and severally repay in
full the unpaid principal amount of each Loan on the Commitment Termination Date. Prior thereto,
payments and prepayments of Loans shall or may be made as set forth below.

     (a) From time to time on any Business Day, any Borrower may make a voluntary
prepayment, in whole or in part, of the outstanding principal amount of any Loans on the
same Business Day, subject to advance notice received by the Administrative Agent on or
before 1:00 p.m., New York City, time, on the Business Day of such prepayment;
provided, however, that except to the extent the Obligations are paid
pursuant to Section 3.1.3, each such partial prepayment shall be, in the case of
LIBO Rate Loans, in an aggregate minimum amount of $500,000 and an integral multiple of
$100,000 and, in the case of Base Rate Loans, in an aggregate minimum amount of $100,000 and
an integral multiple of $10,000. Each notice of intent to make a

52

 

prepayment shall specify the prepayment date, which Loans are being prepaid, the
principal amount of the Loans to be prepaid and shall be irrevocable and shall commit the
Borrowers to prepay such Loans by the amount and on the date stated therein. The
Administrative Agent shall, promptly after receiving any notice given by the Company
hereunder, notify each Lender of the principal amount of the Loans held by such Lender which
are to be prepaid, the prepayment date and the manner of application of the prepayment. In
the event the Borrowers fail to prepay any Loan on the date specified in any prepayment
notice delivered pursuant to clause (a) of Section 3.1.1, the Borrowers on
demand by any Lender shall pay to the Administrative Agent for the account of such Lender
any amounts required to compensate such Lender for any loss incurred by such Lender as a
result of such failure to prepay, including any loss, cost or expenses incurred by reason of
the acquisition of deposits or other funds by such Lender to fulfill deposit obligations
incurred in anticipation of such prepayment. Each Lender shall deliver to the Borrowers
from time to time one or more certificates setting forth the amount of such loss as
determined by such Lender.

     (b) On each date when the sum of (i) the aggregate outstanding principal amount of all
Revolving Credit Loans and Swing Line Loans and (ii) the aggregate amount of all Letter of
Credit Outstandings exceeds the then applicable Maximum Loan Amount, the Borrowers shall
make a mandatory prepayment of Revolving Credit Loans or Swing Line Loans or, if necessary,
Cash Collateralize all Letter of Credit Outstandings, as specified by the Company, in an
aggregate amount equal to such excess.

     (c) Concurrently with the receipt of any Net Disposition Proceeds by any Borrower or
any Restricted Subsidiary of any Borrower, the Company shall deliver to the Administrative
Agent a calculation of the amount of such Net Disposition Proceeds and the Borrowers or any
of them shall make a mandatory prepayment of the Obligations in an amount equal to 100% of
such Net Disposition Proceeds, to be applied as set forth in clause (b) of
Section 3.1.2.

     (d) Concurrently with the receipt of any Net Debt Proceeds by any Borrower or any
Restricted Subsidiary of any Borrower, the Company shall deliver to the Administrative Agent
a calculation of the amount of such Net Debt Proceeds and the Borrowers or any of them shall
make a mandatory prepayment of the Obligations in an amount equal to 100% of such Net Debt
Proceeds, to be applied as set forth in clause (c) of Section 3.1.2.

     (e) Promptly upon any acceleration of the Obligations pursuant to Section 8.2,
the Borrowers shall jointly and severally pay in full all outstanding Loans and all unpaid
and outstanding Reimbursement Obligations and Cash Collateralize, as applicable, all
outstanding Letters of Credit, unless, pursuant to Section 8.2, only a portion of
all the Obligations is so accelerated (in which case the portion so accelerated shall be so
repaid and/or Cash Collateralized, as applicable).

     (f) The Borrowers shall pay, together with each payment and/or prepayment of Loans and
Reimbursement Obligations made as set forth in this Section 3.1.1 and

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elsewhere in this Agreement, accrued interest on the amount paid and/or prepaid and any
amounts required pursuant to Section 4.4.

Each prepayment of any Loans made pursuant to this Section shall be without premium or penalty,
except as may be required by Section 4.4.

          3.1.2. Application. Amounts paid and/or prepaid pursuant to Section 3.1.1
shall be applied as set forth in this Section 3.1.2.

     (a) Subject to clause (b) of this Section 3.1.2, each payment and/or
prepayment of the principal of the Loans shall be applied, to the extent of such payment
and/or prepayment, first, to the principal amount thereof being maintained as Base
Rate Loans, and second, subject to the terms of Section 4.4, to the
principal amount thereof being maintained as LIBO Rate Loans.

     (b) Each prepayment of Obligations pursuant to clause (c) of Section
3.1.1 shall be applied first, to a mandatory prepayment of the outstanding Swing Line
Loans until all outstanding Swing Line Loans have been repaid in full, second, to a
mandatory prepayment of all outstanding Revolving Credit Loans until all outstanding
Revolving Credit Loans have been repaid in full, third, to Cash Collateralize all
Letter of Credit Outstandings (provided that to the extent that the Lenders have
funded their pro rata share of unpaid and outstanding Reimbursement Obligations to the
Issuer, then such amounts shall be deemed to be part of Revolving Credit Loans for purposes
of this clause (b) of Section 3.1.2) and fourth, to payment of any
amounts owing with respect to Banking Services and Hedging Agreements.

     (c) Each prepayment of Obligations made pursuant to clause (d) of Section
3.1.1 shall be applied pro rata to a mandatory prepayment of the outstanding amount of
all Swing Line Loans, Revolving Credit Loans, Letter of Credit Obligations and all remaining
Obligations until the outstanding amount of all Obligations has been reduced to zero and all
Letters of Credit have been Cash Collateralized. In addition, the Revolving Credit
Commitment Amount shall be automatically and permanently reduced by the aggregate amount of
Net Debt Proceeds.

          3.1.3. Matters Relating to Controlled Deposit Accounts. All Receipts shall be managed
as provided in this Section 3.1.3, except as otherwise expressly provided in this
Agreement.

     (a) The Borrowers shall, and shall cause each Restricted Subsidiary to, establish and
maintain at their expense, with an Approved Depository Bank which has entered into a Control
Agreement with the Administrative Agent and the applicable Borrower or Restricted
Subsidiary, deposit accounts (herein “Controlled Deposit Accounts”), styled with
names acceptable to the Administrative Agent to indicate the interests therein of the
Administrative Agent and the Lenders. The Borrowers shall, and shall cause each Restricted
Subsidiary to, ensure that all Receipts are either (i) paid directly from the relevant
Account Debtors or other Persons, as applicable, into the Controlled Deposit Accounts or
(ii) following receipt by any Borrower or any Restricted

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Subsidiary of any Borrower, immediately deposited into a Controlled Deposit Account, in
each case in accordance with procedures and arrangements acceptable to the Administrative
Agent and subject only to such changes as may be approved in advance by the Administrative
Agent. The Control Agreement with respect to each Controlled Deposit Account shall provide
that, upon the Administrative Agent’s request (it being agreed to by the Borrowers that the
Administrative Agent may so request (i) upon the occurrence and during the continuance of a
Default or (ii) at any time that Excess Availability is less than $10,000,000), the Approved
Depository Bank with respect to such Controlled Deposit Account shall directly or indirectly
transfer all Receipts, deposited and/or other items paid into such Controlled Deposit
Account (in accordance with the aforementioned procedures and arrangements), on each
Business Day, in immediately available funds, into a deposit account maintained by the
Administrative Agent at a commercial bank selected by the Administrative Agent in its sole
discretion and communicated to the Company (the “Concentration Account”). The
Borrowers acknowledge that they waive and shall have no right to object to or seek to delay
any such transfer to the Concentration Account or to cause any other application of any
Receipts, deposited and/or paid into the Controlled Deposit Accounts. The Borrowers shall
accurately report on a weekly basis to the Administrative Agent all amounts deposited and/or
paid into the Controlled Deposit Accounts to ensure the proper transfer of funds as set
forth above.

     (b) Prior to the initial Credit Extensions, the Borrowers shall cause each Approved
Depository Bank at which the Controlled Deposit Accounts are maintained to enter into
Control Agreements providing for the transfers as set forth above, acknowledging that the
Receipts paid into, received or deposited in the Controlled Deposit Accounts maintained with
them are subject to the Lien of the Administrative Agent, for the benefit of the
Administrative Agent and the Lenders, that such Approved Depository Bank has no Lien upon or
right of setoff against any Controlled Deposit Account and/or Concentration Account
maintained with it or any of the Receipts received for deposit or deposited from time to
time therein, and that, upon the request of the Administrative Agent, such Approved
Depository Bank will wire or otherwise transfer, in immediately available funds, on each
Business Day, all Receipts paid into, received or deposited in all Controlled Deposit
Accounts maintained with it to the Concentration Account.

     (c) The Borrowers acknowledge that the Administrative Agent at all times will maintain
the Concentration Account in its own name and that the Concentration Account and the
Controlled Deposit Accounts will be subject to the sole dominion and control of the
Administrative Agent pursuant to this Agreement and the Control Agreements, and the
Borrowers agree (and agree to confirm to all Persons) that neither the Borrowers nor any
Restricted Subsidiary of any Borrower shall at any time have any right to make any
withdrawal from or give any instructions to any Approved Depository Bank with respect to the
Controlled Deposit Accounts or the Concentration Account, except as provided in the
applicable Control Agreement.

     (d) At all times when no Credit Extensions are outstanding and no Default or Event of
Default is continuing, the Administrative Agent shall automatically cause the

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funds transferred to the Concentration Account pursuant to this Section 3.1.3
and the Control Agreements to be released as promptly as practicable to the Borrowers, to
such account as may be designated by notice from the Company to the Administrative Agent.
At all times when any Credit Extensions are outstanding or a Default or an Event of Default
is continuing, the Administrative Agent shall apply (subject to the provisions of
Section 3.1.1 and Section 3.1.2), on a daily basis, all funds transferred
into the Concentration Account pursuant to this Section 3.1.3 and the Control
Agreements (i) first, to the payment of any and all fees and expenses then due and
owing to the Administrative Agent; (ii) second, to the payment of any and all fees
and expenses then due and owing to the other Lenders in accordance with their respective
Percentages; (iii) third, to the payment of all accrued and unpaid interest on Swing
Line Loans; (iv) fourth, to the payment of all accrued and unpaid interest on
Revolving Credit Loans, to each Lender in accordance with each Lender’s respective
Percentage; (v) fifth, to reduce all Swing Line Loans until all outstanding Swing
Line Loans have been paid in full; (vi) sixth, to the payment to the Lenders of, in
accordance with their respective Percentages, all outstanding Revolving Credit Loans until
all outstanding Revolving Credit Loans have been paid in full; (vii) seventh, to
reduce all unpaid and outstanding Reimbursement Obligations; (viii) eighth, to Cash
Collateralize all Letters of Credit; (ix) ninth, to the ratable payment of all
Banking Services Obligations and to payment of any amounts owing with respect to Hedging
Agreements; (x) tenth, the ratable payment of all other unpaid and outstanding
Obligations, to each Secured Party in accordance with the proportion that the unpaid and
outstanding Obligations to such Secured Party bears to the unpaid and outstanding
Obligations to all Secured Parties; and (xi) eleventh, when a Default or Event of
Default is continuing, for so long as any of the Obligations then due and payable are
outstanding or this Agreement and/or the Commitments have not been terminated, any remaining
funds shall continue to be held by the Administrative Agent as security for the Obligations
pursuant to the terms hereof and the other Loan Documents and applied to any outstanding
Obligations in accordance with clauses (i) through (x) above until all Obligations have been
paid in full, and all Commitments and this Agreement have been terminated. To the extent
that any Receipts are not sent directly to the appropriate Controlled Deposit Account but
are received by any Borrower or any Subsidiary of any Borrower, such Receipts shall be held
in trust for the benefit of the Administrative Agent and the Lenders and immediately
remitted, in the form received, to the appropriate Controlled Deposit Account. Each
Borrower acknowledges and agrees that its compliance with the terms of this Section
3.1.3 is essential.

     (e) All funds transferred from the Concentration Account for application to amounts
owing by the Borrowers under this Agreement will be credited against the Obligation Account
of the Borrowers on the next Business Day after the Administrative Agent’s receipt of
“collected funds” at the Concentration Account, if received no later than 12:00 noon (New
York City time), or on the second succeeding Business Day, if received after 12:00 noon (New
York City time). No checks, drafts or other instrument received in either a Controlled
Deposit Account or the Concentration Account shall be treated as received unless and until
such checks, drafts or instruments have actually been collected. Except as otherwise
expressly provided in this Agreement (including Section 3.1.1), the Administrative
Agent shall, for value at the time specified above in this provision, apply the funds
credited to the Concentration Account, first, to any expenses,

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indemnifications or fees owing pursuant to this Agreement or any other Loan Document,
second, to interest on the Loans and Reimbursement Obligations being repaid and,
third, to reduce the outstanding balance of the Loans and Reimbursement Obligations
being repaid.

          3.1.4. Power of Attorney. Each of the Borrowers hereby irrevocably appoints and makes
each of the officers of the Administrative Agent the true and lawful attorney for such Borrower
(without requiring any of them to act as such) with full power of substitution to, do the
following: (a) at any time that Excess Availability is less than $10,000,000 or at any time during
the continuance of an Event of Default, endorse the name of such Borrower upon any and all checks,
drafts, money orders, and other instruments for the payment of money that are payable to such
Borrower and constitute Receipts of such Borrower; (b) execute in the name of such Borrower any
financing statements, schedules, assignments, instruments, documents, and statements that such
Borrower is obligated to give to the Administrative Agent or any Lender under this Agreement or any
other Loan Document; and (c) do such other and further acts and deeds in the name of such Borrower
as the Administrative Agent may deem necessary or desirable to enforce the provisions of this
Agreement or any other Loan Document or perfect the security interest in or Lien on any Collateral
that is granted pursuant to any Loan Document to the Administrative Agent or any Lenders. In
addition, if any Borrower breaches its obligation hereunder to direct Receipts to the appropriate
Controlled Deposit Account, the Administrative Agent, as the true and lawful attorney for such
Borrower pursuant to this Section 3.1.4, and subject to any applicable law or regulation,
may, by the signature or other act of any of the Administrative Agent’s officers (without requiring
any of them to do so), direct any Account Debtor or other applicable Person to make payments of or
with respect to Receipts to the appropriate Controlled Deposit Account.

          3.1.5. Charges to Obligation Account. Each of the Borrowers hereby authorizes the
Administrative Agent (in its sole discretion, but without any obligation to do so) to charge the
Obligation Account with the amount of any and all payments due under this Agreement as such
payments become due, including payments due under Sections 2.6, 3.1, 3.2,
3.3, 4.4, 4.5, 4.6, and 10.3. The Borrowers hereby confirm
that any charges which the Administrative Agent may so make to the Obligation Account as provided
in this Agreement or any other Loan Document may be made by the Administrative Agent without a
Borrowing Request, whether or not a Default or Event of Default has occurred and without compliance
with any of the other conditions precedent set forth in Article V and will be made as an
accommodation to the Borrowers and solely at the Administrative Agent’s discretion.

     SECTION 3.2. Interest Provisions. Interest on outstanding Obligations shall accrue
and be payable in accordance with the terms set forth in this Section 3.2.

          3.2.1. Rates. Subject to Section 2.3.2, pursuant to an appropriately
delivered Borrowing Request or Continuation/Conversion Notice, the Company may elect that Loans
comprising a Borrowing accrue interest at a rate per annum:

     (a) on that portion maintained from time to time as a Base Rate Loan, equal to the sum
of the Alternate Base Rate from time to time in effect, plus the Applicable

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Margin; provided that all Swing Line Loans shall always accrue interest at the
relevant Applicable Margin for Loans maintained as Base Rate Loans; and

     (b) on that portion maintained as a LIBO Rate Loan, during each Interest Period
applicable thereto, equal to the sum of the LIBO Rate (Reserve Adjusted) for such Interest
Period, plus the Applicable Margin.

Subject to Section 3.2.2, the Borrowers agree, jointly and severally, to pay interest in
respect of the unpaid principal amount of each Base Rate Loan from the date thereof until payment
in full thereof at a rate per annum which shall be, for any day, equal to the sum of the relevant
Applicable Margin plus the Alternate Base Rate in effect on such day, but in no event to
exceed the Highest Lawful Rate. For purposes of this Agreement, any change in the Alternate Base
Rate due to a change in the Federal Funds Rate or the Base Rate shall be effective as of the
opening of business on the effective date of such change in the Federal Funds Rate or the Base
Rate, as the case may be. If for any reason the Administrative Agent shall have determined (which
determination shall be conclusive and binding, absent manifest error) that it is unable to
ascertain the Federal Funds Rate for any reason, including the inability of the Administrative
Agent to obtain sufficient bids or publications in accordance with the terms hereof, the Base Rate
shall be the Alternate Base Rate until the circumstances giving rise to such inability no longer
exist. Subject to Section 3.2.2, the Borrowers agree, jointly and severally, to pay
interest in respect of the unpaid principal amount of each LIBO Rate Loan from the date thereof
until payment in full thereof at a rate per annum which shall be equal to the sum of the relevant
Applicable Margin plus the LIBO Rate, but in no event to exceed the Highest Lawful Rate.
All LIBO Rate Loans shall bear interest from and including the first day of the applicable Interest
Period to (but not including) the last day of such Interest Period at the interest rate applicable
to such LIBO Rate Loan.

          3.2.2. Post-Maturity Rates. After the date any principal amount of any Loan or
Reimbursement Obligation is due and payable (whether on the Maturity Date, upon acceleration or
otherwise), or after any other monetary Obligation of the Borrowers shall have become due and
payable, the Borrowers shall jointly and severally pay, but subject in all cases to Section
10.17, interest (after as well as before judgment) on such amounts at a rate per annum equal to
the Alternate Base Rate from time to time in effect, plus the Applicable Margin,
plus, a margin of 2%.

          3.2.3. Payment Dates. Interest accrued on each Loan shall be payable, without
duplication:

     (a) on the Maturity Date therefor;

     (b) on the date of any payment or prepayment, in whole or in part, of principal
outstanding on such Loan on the principal amount so paid or prepaid;

     (c) with respect to Base Rate Loans, on each Monthly Payment Date occurring after the
Closing Date;

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     (d) with respect to LIBO Rate Loans, on the last day of each applicable Interest
Period, and, in the case of six-month Interest Periods, on the day which occurs during such
Interest Period three months after the first day of such Interest Period;

     (e) with respect to any Base Rate Loans converted into LIBO Rate Loans on a day when
interest would not otherwise have been payable pursuant to clause (c) of this
Section 3.2.3, on the date of such conversion; and

     (f) on that portion of any Loans the Maturity Date of which is accelerated pursuant to
Section 8.2, immediately upon such acceleration.

Interest accrued on Loans or any other monetary Obligations after the date such Loan or other
monetary Obligation is due and payable (whether on the Maturity Date, upon acceleration or
otherwise) shall be payable upon demand.

     SECTION 3.3. Fees. Each Borrower agrees to pay the fees set forth below. All such
fees once paid shall be non-refundable.

          3.3.1. Commitment Fees. The Borrowers agree to pay, jointly and severally, to the
Administrative Agent for the account of each Lender, for the period (including any portion thereof
when any Commitments are suspended by reason of the inability of the Borrowers to satisfy any
condition of Article V) commencing on the Closing Date and continuing through the
Commitment Termination Date, a non-refundable commitment fee, payable monthly in arrears, equal to,
in each case on such Lender’s Percentage of, the product of (a) the difference between (i) the
Revolving Credit Commitment Amount and (ii) the sum of (A) the average daily outstanding balance of
all Revolving Credit Loans, plus (B) the daily average Stated Amount of all outstanding
Letters of Credit; multiplied by (b) three-eighths of one percent (0.375%) (the
“Commitment Fee”). All Commitment Fees payable pursuant to this Section 3.3.1
shall be calculated on a year comprised of 360 days and payable by the Borrowers in arrears on each
Monthly Payment Date, commencing with the first Monthly Payment Date following the Closing Date,
and on the Commitment Termination Date. The making of Swing Line Loans shall not constitute usage
of the Revolving Credit Commitment or otherwise be deducted from the Revolving Credit Commitment
Amount for purposes of calculating the Commitment Fees to be paid by the Borrowers to the Lenders.

          3.3.2. The Administrative Agent’s Fees. The Borrowers agree to pay, jointly and
severally, to the Administrative Agent for its own account, the fees set forth in the Fee Letter,
in each case in the amount and on the date set forth in the Fee Letter.

          3.3.3. Letter of Credit Fees. The Borrowers agree to pay, jointly and severally, to
the Administrative Agent, (a) all charges imposed on the Administrative Agent by the Issuer for
Letters of Credit and (b) for the pro rata account of each Lender, an aggregate Letter of Credit
fee on the daily average Stated Amount of each Letter of Credit, in each case for the period from
and including the date of issuance of such Letter of Credit to and excluding the date of expiration
or termination of such Letter of Credit computed at a per annum rate for each day equal to the then
Applicable Margin for LIBO Rate Loans, such fees being payable monthly in arrears on each Monthly
Payment Date and on the Commitment Termination Date. The

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Borrowers further agree to pay, jointly and severally, to each Issuer monthly in arrears on
each Monthly Payment Date following the date of issuance of a Letter of Credit until the earlier of
the expiration of such Letter of Credit and the Commitment Termination Date, an issuance fee agreed
to by the Borrowers and the Issuer.

ARTICLE IV

CERTAIN LIBO RATE AND GUARANTY PROVISIONS

     SECTION 4.1. LIBO Rate Lending Unlawful. If any Lender shall reasonably determine
(which determination shall, in the absence of manifest error and upon notice thereof to the Company
and the Administrative Agent, be conclusive and binding on each Borrower) that the introduction of
or any change in or in the interpretation of any law makes it unlawful, or any Governmental
Authority asserts that it is unlawful, for such Lender to make or continue any Loan as, or to
convert any Loan into, a LIBO Rate Loan, the obligations of such Lender to make, continue or
convert any such LIBO Rate Loan shall, upon such determination, forthwith be suspended until such
Lender shall notify the Administrative Agent that the circumstances causing such suspension no
longer exist, and all outstanding LIBO Rate Loans payable to such Lender shall automatically
convert into Base Rate Loans at the end of the then current Interest Periods with respect thereto
or sooner, if required by such law or assertion.

     SECTION 4.2. Deposits Unavailable. If the Administrative Agent shall have determined
that

     (a) Dollar deposits in the relevant amount and for the relevant Interest Period are not
available to it in its relevant market; or

     (b) by reason of circumstances affecting its relevant market, adequate means do not
exist for ascertaining the interest rate applicable hereunder to LIBO Rate Loans;

then, upon notice from the Administrative Agent to the Company and the Lenders, the obligations of
all Lenders under Section 2.3 and Section 2.4 to make or continue any Loans as, or
to convert any Loans into, LIBO Rate Loans shall forthwith be suspended until the Administrative
Agent shall notify the Company and the Lenders that the circumstances causing such suspension no
longer exist; provided that, in such case, the Lenders shall use their reasonable efforts
to obtain funding of the Loans at a rate comparable with the LIBO Rate (Reserve Adjusted) in other
Eurodollar markets.

     SECTION 4.3. Increased LIBO Rate Loan Costs, etc. Each Borrower agrees, jointly and
severally, to reimburse each Lender and Issuer for any increase in the cost to such Lender or
Issuer of, or any reduction in the amount of any sum receivable by such Secured Party in respect
of, such Secured Party’s Commitments and the making of Credit Extensions hereunder (including the
making, continuing or maintaining (or of its obligation to make or continue) any Loans as, or of
converting (or of its obligation to convert) any Loans into, LIBO Rate Loans) that arise in
connection with any change in, or the introduction, adoption, effectiveness, interpretation,
reinterpretation or phase-in after the date hereof of, any law or regulation, directive, guideline,
decision or request (whether or not having the force of law) of any Governmental Authority, except
for such changes with respect to increased capital costs and

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Taxes which are governed by Sections 4.5 and 4.6, respectively. Each affected
Secured Party shall promptly notify the Administrative Agent and the Company in writing of the
occurrence of any such event, stating the reasons therefor and the additional amount required fully
to compensate such Secured Party for such increased cost or reduced amount. Such additional
amounts shall be payable by the Borrowers directly to such Secured Party within five days of its
receipt of such notice, and such notice shall, in the absence of manifest error, be conclusive and
binding on the Borrowers.

     SECTION 4.4. Funding Losses. In the event any Lender shall incur any loss or expense
(including any loss or expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by such Lender to make or continue any portion of the principal amount of any
Loan as, or to convert any portion of the principal amount of any Loan into, a LIBO Rate Loan) not
recovered in connection with the redeployment of such funds (and excluding any loss of anticipated
profits) as a result of:

     (a) any conversion or repayment or prepayment of the principal amount of any LIBO Rate
Loan on a date other than the scheduled last day of the Interest Period applicable thereto,
whether pursuant to Section 4.1, Section 4.2, Article III or
otherwise;

     (b) any Loans not being made as LIBO Rate Loans in accordance with the Borrowing
Request therefor (unless due to the responsibility of the Lender or inability of the Lender
to fund Credit Extensions in accordance with the terms hereof); or

     (c) any Loans not being continued as, or converted into, LIBO Rate Loans in accordance
with the Continuation/Conversion Notice therefor (unless due to the responsibility of the
Lender or inability of the Lender to fund Credit Extensions in accordance with the terms
hereof);

then, upon the written notice of such Lender to the Company (with a copy to the Administrative
Agent), the Borrowers shall, jointly and severally, within five days of their receipt thereof, pay
directly to such Lender such amount as will (in the reasonable determination of such Lender)
reimburse such Lender for such loss or expense. Such written notice shall set forth the basis for
requesting such amounts and shall, in the absence of manifest error, be conclusive and binding on
each Borrower.

     SECTION 4.5. Increased Capital Costs. If any change in, or the introduction,
adoption, effectiveness, interpretation, reinterpretation or phase-in of, any law or regulation,
directive, guideline, decision or request (having the force of law) of any Governmental Authority
affects or would affect the amount of capital required or expected to be maintained by any Secured
Party or any Person controlling such Secured Party, and such Secured Party determines (in good
faith but in its sole and absolute discretion) that the rate of return on its or such controlling
Person’s capital as a consequence of the Commitments or the Credit Extensions made, or the Letters
of Credit participated in, by such Secured Party is reduced to a level below that which such
Secured Party or such controlling Person could have achieved but for the occurrence of any such
circumstance, then upon notice from time to time by such Secured Party to the Company, the
Borrowers shall, within five days following receipt of such notice (which notice shall be sent to
the Company promptly (but in no event later than 180 days) after

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obtaining actual knowledge by such Lender of any such amounts owed by the Borrowers and the
amount shall be conclusively determined by such Lender), jointly and severally, pay directly to
such Secured Party additional amounts sufficient to compensate such Secured Party or such
controlling Person for such reduction in rate of return to the extent allocable to such Lender’s
Commitments or the Credit Extensions made, or the Letters of Credit participated in by such Lender.
A statement of such Secured Party as to any such additional amount or amounts shall, in the
absence of manifest error, be conclusive and binding on each Borrower. In determining such amount,
such Secured Party may use any method of averaging and attribution that it (in its sole and
absolute discretion) shall deem applicable, provided that the determination of such amount
is made in good faith and in a manner generally consistent with such Secured Party’s standard
practice therefor.

     SECTION 4.6. Taxes. Each Borrower covenants and agrees as follows with respect to
Taxes:

     (a) Any and all payments by the Borrowers under each Loan Document shall be made
without setoff, counterclaim or other defense, and free and clear of, and without deduction
or withholding for or on account of, any Taxes. In the event that any Taxes are required by
law to be deducted or withheld from any payment required to be made by the Borrowers to or
on behalf of any Secured Party under any Loan Document, then:

     (i) subject to clause (f) of this Section 4.6, if such Taxes
are Non-Excluded Taxes, the amount of such payment shall be increased as may be
necessary such that such payment is made, after withholding or deduction for or on
account of such Taxes, in an amount that is not less than the amount provided for in
such Loan Document; and

     (ii) the Borrowers shall withhold the full amount of such Taxes from such
payment (as increased pursuant to clause (a)(i) of this Section 4.6)
and shall pay such amount to the Governmental Authority imposing such Taxes in
accordance with applicable law.

     (b) In addition, the Borrowers shall pay any and all Other Taxes imposed to the
relevant Governmental Authority imposing such Other Taxes in accordance with applicable law.

     (c) As promptly as practicable after the payment of any Taxes or Other Taxes, and in
any event within 45 days of any such payment being due, the Borrowers shall furnish to the
Administrative Agent a copy of an official receipt (or a certified copy thereof) evidencing
the payment of such Taxes or Other Taxes. The Administrative Agent shall make copies
thereof available to any Lender upon request therefor.

     (d) Subject to clause (f) of this Section 4.6, each Borrower, on a
joint and several basis, shall indemnify each Secured Party for any Non-Excluded Taxes and
Other Taxes levied, imposed or assessed on (and whether or not paid directly by) such
Secured Party. Promptly upon having knowledge that any such Non-Excluded Taxes or Other
Taxes have been levied, imposed or assessed, and promptly upon notice thereof by any

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Secured Party, the Borrowers shall pay such Non-Excluded Taxes or Other Taxes directly
to the relevant Governmental Authority. If a Secured Party receives a refund in respect of
any Non-Excluded Taxes or Other Taxes with respect to which any Borrower has paid additional
amounts pursuant to this Section 4.6, it shall within 30 days from the date of such
receipt pay over to the Borrowers (but only to the extent of indemnity payments made, or
additional amounts paid, by the Borrowers under this Section 4.6 with respect to the
Non-Excluded Taxes or Other Taxes giving rise to such refund), net of all out-of-pocket
expenses of such Secured Party and without interest (other than interest paid by the
relevant jurisdiction or taxing authority with respect to such refund) the portion of such
refund which, in the good faith judgment of such Secured Party, is attributable to the
payment of such additional amounts by the Borrowers and in an amount as will leave such
Secured Party in no better or worse position than it would have been in if the payment of
such additional amounts had not been required; provided, however, that the
Borrowers, upon the request of such Secured Party, agree to repay the amount paid over to
the Borrowers (plus penalties, interest or other charges payable to the relevant
jurisdiction or taxing authority) to such Secured Party in the event such Secured Party is
required to repay such refund to such jurisdiction or taxing authority. In addition, each
Borrower, on a joint and several basis, shall indemnify each Secured Party for any
incremental Taxes that may become payable by such Secured Party as a result of any failure
of the Borrowers to pay any Taxes when due to the appropriate Governmental Authority or to
deliver to the Administrative Agent, pursuant to clause (c) of this Section
4.6, documentation evidencing the payment of Taxes or Other Taxes. With respect to
indemnification for Non-Excluded Taxes and Other Taxes actually paid by any Secured Party or
the indemnification provided in the immediately preceding sentence, such indemnification
shall be made within 30 days after the date such Secured Party makes written demand
therefor. Each Borrower acknowledges that any payment made to any Secured Party or to any
Governmental Authority in respect of the indemnification obligations of the Borrowers
provided in this clause shall constitute a payment in respect of which the provisions of
clause (a) of this Section 4.6, and this clause shall apply.

     (e) As of the date on which any Lender becomes a party hereto, such Lender represents
that it is either (i) a corporation organized under the laws of the United States or any
State or is otherwise a “United States-person” within the meaning of Section 7701(a)(30) of
the Code, (ii) entitled to complete exemption from United States withholding tax imposed on
or with respect to any payments, including fees, to be made to it pursuant to this Agreement
or (iii) entitled to complete exemption from United States withholding tax on interest
imposed on or with respect to any payments of interest to be made pursuant to this Agreement
(A) under an applicable provision of a tax convention to which the United States is a party,
(B) because such payments to be received by it hereunder is effectively connected with a
trade or business in the United States or (C) because it is a recipient of portfolio
interest within the meaning of Section 871(h) or 881(c) of the Code. Each Non-U.S. Lender,
on or prior to the date on which such Non-U.S. Lender becomes a Lender hereunder shall
deliver to the Company and the Administrative Agent either:

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     (i) two duly completed copies of either (x) Internal Revenue Service Form
W-8BEN or (B) Internal Revenue Service Form W-8ECI, or in either case an applicable
successor form; or

     (ii) in the case of a Non-U.S. Lender that is not legally entitled to deliver
either form listed in clause (e)(i) of this Section 4.6, (x) a
certificate of a duly authorized officer of such Non-U.S. Lender in substantially
the form of Exhibit L attached hereto to the effect that such Non-U.S.
Lender is not (A) a “bank” within the meaning of Section 881(c)(3)(A) of the Code,
(B) a “10 percent shareholder” of any Borrower within the meaning of Section
881(c)(3)(B) of the Code, or (C) a controlled foreign corporation receiving interest
from a related person within the meaning of Section 881(c)(3)(C) of the Code (such
certificate, an “Exemption Certificate”) and (y) two duly completed copies
of Internal Revenue Service Form W-8BEN or applicable successor form.

     In addition, each Non-U.S. Lender shall redeliver to the Company and the Administrative Agent
the forms prescribed by this clause (e) of this Section 4.6 from time to time
thereafter upon the request of the Company or the Administrative Agent or as required by applicable
law or regulation and prior to the date of expiration of the most recently delivered form, but only
for so long as such Non-U.S. Lender is legally entitled to do so.

     (f) The Borrowers shall not be obligated to gross up any payments to any Lender
pursuant to clause (a)(i) of this Section 4.6, or to indemnify any Lender
pursuant to clause (d) of this Section 4.6, in respect of United States
federal withholding taxes to the extent imposed as a result of (i) the failure of such
Lender to deliver to the Company the form or forms and/or an Exemption Certificate, as
applicable to such Lender, pursuant to clause (e) of this Section 4.6, (ii)
such form or forms and/or Exemption Certificate not establishing a complete exemption from
U.S. federal withholding tax or the information or certifications made therein by the Lender
being untrue or inaccurate on the date delivered in any material respect, or (iii) the
Lender designating a successor lending office at which it maintains its Loans which has the
effect of causing such Lender to become obligated for tax payments in excess of those in
effect immediately prior to such designation; provided, however, that the
Borrowers shall be jointly and severally obligated to gross up any payments to any such
Lender pursuant to clause (a)(i) of this Section 4.6, and to indemnify any
such Lender pursuant to clause (d) of this Section 4.6, in respect of United
States federal withholding taxes if (i) any such failure to deliver a form or forms or an
Exemption Certificate or the failure of such form or forms or Exemption Certificate to
establish a complete exemption from U.S. federal withholding tax or inaccuracy or untruth
contained therein resulted from a change in any applicable statute, treaty, regulation or
other applicable law or any interpretation of any of the foregoing occurring after the date
hereof, which change rendered such Lender no longer legally entitled to deliver such form or
forms or Exemption Certificate or otherwise ineligible for a complete exemption from U.S.
federal withholding tax, or rendered the information or certifications made in such form or
forms or Exemption Certificate untrue or inaccurate in a material respect, (ii) the
redesignation of the Lender’s lending office was made at the request of the Borrowers or
(iii) the obligation to gross up payments to any such Lender pursuant to clause
(a)(i) of this Section 4.6, or to indemnify any such

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Lender pursuant to clause (d) of this Section 4.6, is with respect to
an Assignee Lender that becomes an Assignee Lender as a result of an assignment made at the
request of the Borrowers.

     (g) Each Lender also agrees at the reasonable request of the Borrowers to deliver to
the Borrowers and the Administrative Agent such other or supplemental forms as may at any
time be required as a result of changes in applicable law or regulation in order to confirm
or maintain in effect its entitlement to exemption from United States withholding tax on any
payments hereunder; provided that the circumstances of the Lender at the relevant
time and applicable laws make it legally entitled to do so. Each Person that shall become a
Lender or a Participant pursuant to Section 10.11.1 or Section 10.11.2
shall, upon the effectiveness of the related transfer, be required to provide all of the
forms, certifications and statements required pursuant to this Section 4.6;
provided that in the case of a Participant, such Participant shall furnish all such
required forms, certifications and statements to the Lender from which the related
participation shall have been purchased.

     (h) Each Lender agrees that it will use reasonable efforts to designate an alternate
lending office with respect to its LIBO Rate Loans affected by any of the matters or
circumstances described in this Section 4.6 to reduce the obligation of the
Borrowers to gross up any payments to any Lenders pursuant to clause (a)(i) of this
Section 4.6, or to indemnify any Lenders pursuant to clause (d) of this
Section 4.6, so long as such designation is not disadvantageous to such Lender as
determined by such Lender in its sole discretion; provided that such Lender shall
have no obligation to so designate an alternate lending office located in the United States.
Any Lender claiming any additional amounts payable pursuant to this Section 4.6
shall use reasonable efforts (consistent with legal and regulatory restrictions) to deliver
to the Borrowers or the Administrative Agent any certificate or document reasonably
requested by any Borrower or the Administrative Agent if the delivery of such certificate or
document would avoid the need for or reduce the amount of any such additional amounts that
may thereafter accrue and would not, in the sole determination of such Lender, be otherwise
disadvantageous to such Lender.

     (i) If any Lender that does not make a LIBO Rate Loan pursuant to Section 4.1
or Section 4.2, is subject to increased costs pursuant to Section 4.3, or is
owed or reasonably anticipates being owed additional amounts pursuant to this Section
4.6 and fails to take action required under clause (h) of this Section
4.6, any Borrower shall have the right, if no Default then exists, to replace such
Lender with another bank or financial institution with the written consent of the
Administrative Agent, which consent shall not be unreasonably withheld, provided
that (i) the obligations of any Borrower owing to the Lender being replaced (including such
increased costs and any amounts payable under Section 4.4) that are not being
assigned to the replacement Lender shall be paid in full to the Lender being replaced
concurrently with such replacement, (ii) the replacement lender shall execute a Lender
Assignment Agreement pursuant to which it shall become a party hereto as provided in
Section 10.11.1, and (iii) upon compliance with the provisions for assignment
provided in Section 10.11.1 and the payment of amounts referred to in clause
(i) of this Section 4.6, the replacement lender shall constitute a “Lender”

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hereunder and the Lender being so replaced shall no longer constitute a “Lender”
hereunder.

     SECTION 4.7. Payments; Computations, etc. Unless otherwise expressly provided in any
applicable Loan Document, all payments by the Borrowers pursuant to each Loan Document shall be
made by such Borrower to the Administrative Agent for the pro rata account of the
Secured Parties entitled to receive such payment. All payments shall be made without setoff,
deduction or counterclaim not later than 12:00 noon New York City time on the date due in same day
or immediately available funds to such account as the Administrative Agent shall specify from time
to time by notice to the Company. Funds received after that time shall be deemed to have been
received by the Administrative Agent on the next succeeding Business Day. The Administrative Agent
shall promptly remit in same day funds to each Secured Party its share, if any, of such payments
received by the Administrative Agent for the account of such Secured Party. All interest
(including interest on LIBO Rate Loans) and fees shall be computed on the basis of the actual
number of days (including the first day but excluding the last day) occurring during the period for
which such interest or fee is payable over a year comprised of 360 days (or, in the case of
interest on a Base Rate Loan (calculated at other than the Federal Funds Rate), 365 days or, if
appropriate, 366 days). Payments due on other than a Business Day shall (except as otherwise
required by clause (c) of the definition of the term “Interest Period”) be made on the next
succeeding Business Day and such extension of time shall be included in computing interest and fees
in connection with that payment.

     SECTION 4.8. Sharing of Payments. If any Secured Party shall obtain any payment or
other recovery (whether voluntary, involuntary, by application of setoff or otherwise) on account
of any Credit Extension or Reimbursement Obligation (other than pursuant to the terms of
Sections 4.3, 4.4, 4.5, or 4.6) in excess of its pro
rata share of payments obtained by all Secured Parties entitled to receive such payment,
such Secured Party shall purchase from the other Secured Parties such participations in Credit
Extensions made by them as shall be necessary to cause such purchasing Secured Party to share the
excess payment or other recovery ratably (to the extent such other Secured Parties were entitled to
receive a portion of such payment or recovery) with each of them; provided,
however, that if all or any portion of the excess payment or other recovery is thereafter
recovered from such purchasing Secured Party, the purchase shall be rescinded and each Secured
Party which has sold a participation to the purchasing Secured Party shall repay to the purchasing
Secured Party the purchase price to the ratable extent of such recovery together with an amount
equal to such selling Secured Party’s ratable share (according to the proportion of (a) the amount
of such selling Secured Party’s required repayment to the purchasing Secured Party to (b) total
amount so recovered from the purchasing Secured Party) of any interest or other amount paid or
payable by the purchasing Secured Party in respect of the total amount so recovered. The Borrowers
agree that any Secured Party purchasing a participation from another Secured Party pursuant to this
Section 4.8 may, to the fullest extent permitted by law, exercise all its rights of payment
(including pursuant to Section 4.9) with respect to such participation as fully as if such
Secured Party were the direct creditor of the Borrowers in the amount of such participation. If
under any applicable bankruptcy, insolvency or other similar law any Secured Party receives a
secured claim in lieu of a setoff to which this Section 4.8 applies, such Secured Party
shall, to the extent practicable, exercise its rights in respect of such secured claim in a manner
consistent with the rights of the

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Secured Parties entitled under this Section 4.8 to share in the benefits of any
recovery on such secured claim.

     SECTION 4.9. Setoff. Each Secured Party shall, upon the occurrence and during the
continuance of any Event of Default and following the giving of notice described in Section
8.2, have the right to appropriate and apply to the payment of the Obligations owing to it
(whether or not then due), and (as security for such Obligations) each Borrower hereby grants to
each Secured Party a continuing security interest in, any and all balances, credits, deposits,
accounts or moneys of such Borrower then or thereafter maintained with such Secured Party;
provided, however, that any such appropriation and application shall be subject to
the provisions of Section 4.8. Each Secured Party agrees promptly to notify such Borrower
and the Administrative Agent after any such setoff and application made by such Secured Party;
provided, however, that the failure to give such notice shall not affect the
validity of such setoff and application. The rights of each Secured Party under this Section
4.9 are in addition to any other rights and remedies (including other rights of setoff under
applicable law or otherwise) which such Secured Party may have under the Loan Documents, at law or
in equity.

     SECTION 4.10. Guaranty Provisions. Each Borrower acknowledges and agrees that,
whether or not specifically indicated as such in a Loan Document, all Obligations shall be joint
and several Obligations of each individual Borrower, and in furtherance of such joint and several
Obligations, each Borrower hereby irrevocably guarantees the payment of all Obligations of each
other Borrower as set forth below.

          4.10.1. Guaranty. Each Borrower hereby jointly and severally, absolutely,
unconditionally and irrevocably guarantees the full and punctual payment when due, whether at
stated maturity, by required prepayment, declaration, acceleration, demand or otherwise, of all
Obligations (of each other Borrower); provided, however, that each Borrower shall
only be liable under this Agreement for the maximum amount of such liability that can be hereby
incurred without rendering this Agreement, as it relates to such Borrower, voidable under
applicable law (including those relating to fraudulent conveyance or fraudulent transfer), and not
for any greater amount. This guaranty constitutes a guaranty of payment when due and not of
collection, and each Borrower specifically agrees that it shall not be necessary or required that
any Secured Party exercise any right, assert any claim or demand or enforce any remedy whatsoever
against any Borrower or any other Person before or as a condition to the obligations of such
Borrower hereunder.

          4.10.2. Guaranty Absolute, etc. The guaranty agreed to above shall in all respects be
a continuing, absolute, unconditional and irrevocable guaranty of payment, and shall remain in full
force and effect until the Termination Date. Each Borrower jointly and severally guarantees that
the Obligations of each other Borrower will be paid strictly in accordance with the terms of each
Loan Document under which such Obligations arise, regardless of any law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such terms or the rights of any Secured
Party with respect thereto. The liability of each Borrower under this Agreement shall be joint and
several, absolute, unconditional and irrevocable irrespective of (a) any lack of validity, legality
or enforceability of any Loan Document; (b) the failure of any Secured Party (i) to assert any
claim or demand or to enforce any right or remedy against any Borrower or any other Person
(including any other guarantor) under the provisions of any Loan

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Document or otherwise, or (ii) to exercise any right or remedy against any other guarantor
(including any Borrower) of, or collateral securing, any Obligations; (c) any change in the time,
manner or place of payment of, or in any other term of, all or any part of the Obligations, or any
other extension, compromise or renewal of any Obligation; (d) any reduction, limitation, impairment
or termination of any Obligations for any reason, including any claim of waiver, release,
surrender, alteration or compromise, and shall not be subject to (and each Borrower hereby waives
any right to or claim of) any defense or setoff, counterclaim, recoupment or termination whatsoever
by reason of the invalidity, illegality, irregularity, compromise, unenforceability of, or any
other event or occurrence affecting, any Obligations or otherwise; (e) any amendment to,
rescission, waiver, or other modification of, or any consent to or departure from, any of the terms
of any Loan Document; (f) any addition, exchange, release, surrender or non-perfection of any
collateral, or any amendment to or waiver or release or addition of, or consent to or departure
from, any other guaranty held by any Secured Party securing any of the Obligations; or (g) any
other circumstance which might otherwise constitute a defense available to, or a legal or equitable
discharge of, any Borrower, any surety or any guarantor.

          4.10.3. Reinstatement, etc. Each Borrower agrees that its guaranty hereunder shall
continue to be effective or be reinstated, as the case may be, if at any time any payment (in whole
or in part) of any of the Obligations is rescinded or must otherwise be restored by any Secured
Party, upon the insolvency, bankruptcy or reorganization of any other Borrower or otherwise, all as
though such payment had not been made.

          4.10.4. Waiver, etc. Each Borrower hereby waives presentment for payment, demand,
protest, notice of dishonor, promptness, diligence, notice of acceptance and any other notice
(other than any notice expressly required in Article VIII) with respect to any of the
Obligations and this Agreement and any requirement that any Secured Party protect, secure, perfect
or insure any Lien, or any property subject thereto, or exhaust any right or take any action
against any other Borrower or any other Person (including any other guarantor) or entity or any
collateral securing the Obligations, as the case may be.

          4.10.5. Postponement of Subrogation, etc. Each Borrower agrees that it will not
exercise any rights which it may acquire by way of rights of subrogation under any Loan Document to
which it is a party, nor shall any Borrower seek or be entitled to seek any contribution or
reimbursement from any Borrower, in respect of any payment made hereunder, under any other Loan
Document or otherwise, until following the Termination Date. Any amount paid to any Borrower on
account of any such subrogation rights prior to the Termination Date shall be held in trust for the
benefit of the Secured Parties and shall immediately be paid and turned over to the Administrative
Agent for the benefit of the Secured Parties in the exact form received by such Borrower (duly
endorsed in favor of the Administrative Agent, if required), to be credited and applied against the
Obligations, whether matured or unmatured, in accordance with Section 4.8;
provided, however, that if (a) any Borrower has made payment to the Secured Parties
of all or any part of the Obligations; and (b) the Termination Date has occurred; then at such
Borrower’s request, the Administrative Agent (on behalf of the Secured Parties) will, at the
expense of such Borrower, execute and deliver to such Borrower appropriate documents (without
recourse and without representation or warranty) necessary to evidence the transfer by subrogation
to such Borrower of an interest in the Obligations resulting from such payment. In furtherance of
the foregoing, at all times prior to the Termination Date, each

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Borrower shall refrain from taking any action or commencing any proceeding against any
Borrower (or its successors or assigns, whether in connection with a bankruptcy proceeding or
otherwise) to recover any amounts in the respect of payments made under any Loan Document to any
Secured Party.

ARTICLE V

CONDITIONS TO CREDIT EXTENSIONS

     SECTION 5.1. Initial Credit Extension. The obligations of the Lenders and, if
applicable, any Issuer to make the initial Credit Extensions shall be subject to the prior or
concurrent satisfaction of each of the conditions precedent set forth in this Section 5.1
to the satisfaction of the Lenders.

          5.1.1. Resolutions, etc. The Administrative Agent shall have received from each
Borrower and each Restricted Subsidiary, (a) recent good standing certificates and certificates of
existence from such Person’s jurisdiction of organization, and (b) a certificate, dated the Closing
Date and with counterparts for each Lender, duly executed and delivered by such Person’s secretary
or assistant secretary as to:

     (i) resolutions of each such Person’s Board of Directors then in full force and
effect authorizing, to the extent relevant, all aspects of the transactions
contemplated hereby applicable to such Person and the execution, delivery and
performance of each Loan Document to be executed by such Person and the transactions
contemplated hereby and thereby;

     (ii) the incumbency and signatures of those of its officers authorized to act
with respect to each Loan Document to be executed by such Person (each an
“Authorized Officer”); and

     (iii) the completeness, accuracy, full force and validity of each Organic
Document of such Person and copies thereof;

upon which certificates each Secured Party may conclusively rely until it shall have received a
further certificate of the secretary or assistant secretary of any such Person canceling or
amending the prior certificate of such Person.

          5.1.2. Intercreditor Agreement. The Administrative Agent shall have received executed
counterparts of the Intercreditor Agreement, dated as of the Closing Date, in each case duly
executed and delivered by all parties thereto and in form and substance reasonably satisfactory to
the Administrative Agent.

          5.1.3. Closing Date Certificate. The Administrative Agent shall have received, with
counterparts for each Lender, the Closing Date Certificate, dated the Closing Date and duly
executed and delivered by an Authorized Officer of each Borrower, in which certificate each
Borrower shall agree and acknowledge that the statements made therein shall be deemed to be
representations and warranties of such Borrower as of such date, and, at the time the certificate
is delivered, such statements shall in fact be true and correct in all material respects.

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All documents and agreements required to be appended to the Closing Date Certificate shall be
in form and substance reasonably satisfactory to the Administrative Agent.

          5.1.4. Delivery of Notes. The Administrative Agent shall have received, for the
account of each Lender that has requested a Note, a Revolving Credit Note and, if applicable, a
Swing Line Note, in the amount of each such Lender’s Revolving Credit Commitment and, if
applicable, the Swing Line Loan Commitment Amount, each such Note having been duly executed and
delivered by an Authorized Officer of each Borrower.

          5.1.5. Minimum Opening Liquidity Amount. The Administrative Agent shall have received
evidence satisfactory to it (including a certificate and supporting calculations from the chief
financial officer of the Company) that after giving effect to all Credit Extensions to be made on
the Closing Date and the issuance of the Senior Secured Notes, the sum of (a) the amount of Excess
Availability, plus, (b) the amount of cash on hand on the Closing Date (after giving effect
to the transactions contemplated herein), is greater than or equal to $50,000,000.

          5.1.6. Closing; Fees; Expenses, etc. The Administrative Agent shall have received for
its own account, or for the account of each Lender, as the case may be, all fees, costs and
expenses due and payable pursuant to Section 3.3 and Section 10.3.

          5.1.7. Borrowing Base Certificate. The Administrative Agent shall have received, with
copies for each Lender, an initial Borrowing Base Certificate, dated the Closing Date, in respect
of Eligible Accounts and Eligible Inventory as of February 28, 2007, duly executed by the chief
financial or accounting Authorized Officer, or the Treasurer or Assistant Treasurer of the Company,
showing that the Borrowing Base Amount (after taking into account the initial Credit Extensions to
be made on the Closing Date and the issuance of the Senior Secured Notes and based on the Borrowing
Base Amount as of February 28, 2007) is greater than or equal to $50,000,000.

          5.1.8. Opinions of Counsel. The Administrative Agent shall have received opinions,
dated the Closing Date and addressed to the Administrative Agent and all Lenders, from (a) Akin
Gump Strauss Hauer & Feld LLP, counsel to the Borrowers, in form and substance reasonably
satisfactory to the Administrative Agent and (b) the General Counsel to the Company, in form and
substance reasonably satisfactory to the Administrative Agent.

          5.1.9. U.C.C. and Other Searches. The Administrative Agent shall have received the
results of U.C.C.-1 searches conducted in the jurisdictions in which the Borrowers and the
Restricted Subsidiaries of the Borrowers are organized, which searches shall reflect the absence of
Liens, other than Permitted Liens and Liens for which the Administrative Agent has received
terminations and releases in form and substance reasonably satisfactory to it.

          5.1.10. Pledge Agreements. The Administrative Agent shall have received, with
counterparts for each Lender, executed counterparts of a Pledge Agreement from the Borrowers or
each of them, dated as of the date hereof, duly executed and delivered by an Authorized Officer of
each Borrower party thereto, together with certificates evidencing all of the issued and
outstanding Capital Securities of any Restricted Subsidiary (other than a Foreign

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Subsidiary) owned by each Borrower, which certificate, in each case, shall be accompanied by
undated instruments of transfer duly executed in blank.

          5.1.11. Security Agreements, etc. The Administrative Agent shall have received, with
counterparts for each Lender, executed counterparts of a Security Agreement from the Borrowers or
each of them, dated as of the date hereof, duly executed by an Authorized Officer of each Borrower
party thereto, together with any promissory notes or other instruments or chattel paper to be
delivered to any Secured Party pursuant to the terms thereof.

          5.1.12. Lien Terminations and Releases. The Administrative Agent shall have received
executed original copies of all terminations, releases and other documentation deemed necessary or
appropriate by the Lenders to evidence the termination and release of all Liens (other than
Permitted Liens) of any Person in the Properties of the Borrowers or any Restricted Subsidiaries of
any Borrowers, including U.C.C.-3 termination statements.

          5.1.13. Controlled Deposit Accounts. The Borrowers and the Restricted Subsidiaries of
the Borrowers shall have established the Controlled Deposit Accounts with Approved Depository Banks
as required pursuant to Section 3.1.3, Section 7.1.9 and Section 7.2.18 and
each such Approved Depository Bank shall have entered into a Control Agreement with the
Administrative Agent and each relevant Borrower or Restricted Subsidiary.

          5.1.14. Perfection Certificate. The Administrative Agent shall have received the
Perfection Certificate, dated as of the Closing Date, duly executed and delivered by an Authorized
Officer of each Borrower.

          5.1.15. Senior Secured Note Documents. The Administrative Agent shall have received
fully executed copies of each Senior Secured Note Document, certified to be true, correct and
complete by an Authorized Officer of the Company and such Senior Secured Note Documents shall be in
form and substance satisfactory to the Lenders, and the Administrative Agent shall have received
evidence satisfactory to it that, on or before the Closing Date, the Company shall have received
not less than $125,000,000 or more than $150,000,000 in gross proceeds from the issuance of the
Senior Secured Notes.

          5.1.16. Existing Senior Secured Notes. The Administrative Agent shall have received
evidence satisfactory to it that, substantially concurrently with the Company’s receipt of the
proceeds from the issuance of the Senior Secured Notes, (i) the Company will repay or repurchase
and thereupon caused to be cancelled such aggregate principal amount of Existing Senior Secured
Notes that, immediately after giving effect to such repayment or repurchase and cancellation, the
aggregate outstanding principal amount of the Existing Senior Secured Notes is not more than
$50,000,000 (the aggregate unpaid amount of Existing Senior Secured Notes after such repayment or
repurchase and cancellation being the “Unpaid Amount”), and (ii) for any Existing Senior
Secured Notes not so repaid or repurchased concurrently with the issuance of the Senior Secured
Notes, the Company has deposited in trust with the trustee under the Existing Indenture, in a
manner reasonably satisfactory to the Administrative Agent, an amount not less than the Unpaid
Amount for purposes of the redemption on a date no more than 31 days thereafter of all such
Existing Senior Secured Notes.

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          5.1.17. No Material Adverse Change. The Administrative Agent shall have received
evidence reasonably satisfactory to it that there shall have been no material adverse change in the
financial condition of any of the Borrowers since December 31, 2006.

          5.1.18. Required Consents and Approvals. All required consents and approvals shall
have been obtained and be in full force and effect with respect to the execution and delivery of
this Agreement and the other Loan Documents and the transactions contemplated herein.

          5.1.19. Satisfactory Legal Form. All documents executed or submitted pursuant hereto
by or on behalf of any Borrower shall be reasonably satisfactory in form and substance to the
Administrative Agent and its counsel and the Administrative Agent and its counsel shall have
received all information, approvals, opinions, documents or instruments as the Administrative Agent
or its counsel may reasonably request.

     SECTION 5.2. All Credit Extensions. The obligation of each Lender and any Issuer to
make any Credit Extension (including the initial Credit Extensions) shall be subject to the
satisfaction of each of the conditions precedent set forth below.

          5.2.1. Compliance With Warranties; No Default, etc. Both before and after giving
effect to any Credit Extension (but, if any Default of the nature referred to in Section
8.1.5 shall have occurred with respect to any other Indebtedness; without giving effect to the
application, directly or indirectly, of the proceeds thereof) the following statements shall be
true and correct:

     (a) the representations and warranties set forth in this Agreement and each other Loan
Document shall, in each case, be true and correct in all material respects with the same
effect as if then made (unless stated to relate solely to an earlier date, in which case
such representations and warranties shall be true and correct in all material respects as of
such earlier date);

     (b) the sum of the aggregate outstanding principal amount of all Revolving Credit Loans
and Swing Line Loans, together with the aggregate amount of all Letter of Credit
Obligations, do not exceed the then applicable Maximum Loan Amount;

     (c) the Borrowers are in compliance with Section 7.2.6; and

     (d) no Default shall have then occurred and be continuing.

          5.2.2. Credit Extension Request, etc. Subject to Section 2.3.1 and
Section 2.3.2, the Administrative Agent shall have received a Borrowing Request if Loans
are being requested, or an Issuance Request if a Letter of Credit is being requested or extended.
Each of the delivery of a Borrowing Request or Issuance Request and the acceptance by any Borrower
of the proceeds of such Credit Extension shall constitute a representation and warranty by each
Borrower that on the date of such Credit Extension (both immediately before and after giving effect
to such Credit Extension and the application of the proceeds thereof) the statements made in
Section 5.2.1 are true and correct in all material respects.

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          5.2.3. Borrowing Base Certificate. The Administrative Agent shall have received the
timely delivery of the most recent Borrowing Base Certificate required to be delivered hereunder
and Administrative Agent shall have received such further information regarding changes since the
date of such Borrowing Base Certificate or matters not referred to therein as Administrative Agent
shall deem necessary (including updated collateral as required under Section 7.1.1(j) or as
otherwise deemed necessary by the Administrative Agent) to determine whether the requested
Borrowing will result in a Default, cause the aggregate amount of outstanding Credit Extensions
(including any unpaid and outstanding Reimbursement Obligations) to exceed the Maximum Loan Amount,
or to otherwise determine if the then applicable Borrowing Base Amount is sufficient to support the
requested Borrowing.

          5.2.4. Payment of Fees. The Borrowers shall have paid to Administrative Agent the
then unpaid balance of all fees then due and payable under and pursuant to this Agreement.

          5.2.5. Satisfactory Legal Form. All documents executed or submitted pursuant hereto
by or on behalf of any Borrower shall be reasonably satisfactory in form and substance to the
Administrative Agent and its counsel and the Administrative Agent and its counsel shall have
received all information, approvals, opinions, documents or instruments as the Administrative Agent
or its counsel may reasonably request.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES

     In order to induce the Secured Parties to enter into this Agreement and the other Loan
Documents and to make Credit Extensions hereunder, each Borrower represents and warrants to each
Secured Party as set forth in this Article VI.

     SECTION 6.1. Organization, etc. Each of the Borrowers and each of their respective
Restricted Subsidiaries is validly organized and existing and in good standing under the laws of
the state or jurisdiction of its incorporation or organization, is duly qualified to do business
and is in good standing as a foreign entity in each jurisdiction where the nature of its business
requires such qualification (except where the failure to be so qualified and in good standing as a
foreign entity could not reasonably be expected to have a Material Adverse Effect), and has full
power and authority and holds all requisite governmental licenses, permits and other approvals to
enter into and perform its Obligations under each Loan Document to which it is a party (except for
failures to hold such governmental licenses, permits and other approvals which, individually or in
the aggregate, could not reasonably be expected to have a Material Adverse Effect) and to own and
hold under lease its material property and to conduct its business substantially as currently
conducted by it.

     SECTION 6.2. Due Authorization, Non-Contravention, etc. The execution, delivery and
performance by each Borrower of this Agreement and by each Borrower and each Restricted Subsidiary
of each other Loan Document to which it is a party, are in each case within each such Person’s
powers, have been duly authorized by all necessary corporate (or other equivalent) action, and do
not:

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     (a) contravene any (i) Organic Documents of such Person, (ii) material agreement or
indenture (including the Indenture) binding on or affecting such Person, (iii) court decree
or order binding on or affecting such Person or (iv) law or governmental regulation binding
on or affecting such Person; or

     (b) result in, or require the creation or imposition of, any Lien on any of such
Person’s Properties (except as contemplated by the Loan Documents or as otherwise permitted
by this Agreement).

     SECTION 6.3. Government Approval; Regulation, etc. No material authorization or
material approval or other action by, and no material notice to or material filing with, any
Governmental Authority or regulatory body or other Person (other than those that have been, or on
the Closing Date will be, duly obtained or made and which are, or on the Closing Date will be, in
full force and effect) is required for the due execution, delivery or performance by any Borrower
or any Restricted Subsidiary of any Loan Document to which it is a party. No Borrower and no
Subsidiary of a Borrower is an “investment company” within the meaning of the Investment Company
Act of 1940, as amended.

     SECTION 6.4. Validity, etc. Each Loan Document has been duly executed and delivered
by the applicable Borrower and/or Restricted Subsidiary of a Borrower party thereto. Each Loan
Document is a legal, valid and binding obligation of each Borrower and each Restricted Subsidiary
party thereto, enforceable against each such Borrower and each such Restricted Subsidiary in
accordance with its terms (except, in any case, as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally and by
principles of equity).

     SECTION 6.5. Financial Information. The financial statements of the Borrowers and
their Subsidiaries furnished to the Administrative Agent and each Lender pursuant to Section
7.1.1 of the Existing Credit Agreement have been prepared in accordance with GAAP consistently
applied (except as may be indicated in the notes thereto), and present fairly subject, in the case
of unqualified financial statements and other unaudited financial information, to normal recurring
audit adjustments, the consolidated financial condition of the Persons covered thereby as at the
dates thereof and the results of their operations for the periods then ended. All balance sheets,
all statements of operations, shareholders’ equity and cash flow and all other financial
information of each of the Borrowers and their Subsidiaries furnished pursuant to Section
7.1.1 have been, and will for periods following the Closing Date, be prepared in accordance
with GAAP consistently applied (except as may be indicated in the notes thereto), and do or will
present fairly subject, in the case of unqualified financial statements and other unaudited
financial information, to normal recurring audit adjustments, the consolidated financial condition
of the Persons covered thereby as at the dates thereof and the results of their operations for the
periods then ended.

     SECTION 6.6. No Material Adverse Change. Since December 31, 2006, and except as
described in the SEC Documents, there has been no material adverse change in the financial
condition, results of operations, assets, business, properties or prospects of the Borrowers or
their Subsidiaries, taken as a whole.

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     SECTION 6.7. Litigation; Labor Controversies, etc. There is no pending or, to the
knowledge of the Borrowers, threatened litigation, action, proceeding or labor controversy, except
as described in the SEC Documents:

     (a) affecting the Borrowers or any Subsidiary of the Borrowers, or any of their
respective properties, businesses, assets or revenues, which could reasonably be expected to
have a Material Adverse Effect, and no adverse development has occurred in any labor
controversy, litigation, arbitration or governmental investigation or proceeding which could
reasonably be expected to have a Material Adverse Effect; or

     (b) which purports to affect the legality, validity or enforceability of any Loan
Document.

     SECTION 6.8. Subsidiaries. There are no Subsidiaries of the Borrowers except those
Subsidiaries (a) which are identified in Item 6.8 of the Disclosure Schedule or (b) which
are permitted to have been organized or acquired in accordance with 7.2.4 and which are in
compliance with the provisions of Section 7.1.8 and Section 7.1.12. None of the
Foreign Subsidiaries of the Borrowers own any material assets or have any material liabilities. As
of the Closing Date, the Company has no Unrestricted Subsidiaries.

     SECTION 6.9. Ownership of Properties. Each Borrower and each of their Restricted
Subsidiaries owns (a) in the case of owned real property, good and indefeasible fee title to, and
(b) in the case of owned personal property, good and valid title to, or, in the case of leased real
or personal property, valid and enforceable leasehold interests (as the case may be) in, all of its
Properties, free and clear in each case of all Liens or claims, except for Permitted Liens.

     SECTION 6.10. Taxes. Each Borrower and each of their Subsidiaries has filed all tax
returns and reports required by any Governmental Authority to have been filed by it and has paid
all Taxes and other governmental charges levied upon any of them or upon any of their respective
Properties or income which are due and payable, including interest and penalties, except where the
failure to pay or file, individually or in the aggregate, could not reasonably be expected to have
a Material Adverse Effect and except such Taxes and other governmental charges which are being
diligently contested in good faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on its books.

     SECTION 6.11. Pension Plans. During the twelve consecutive month period prior to the
Closing Date and prior to the date of any Credit Extension hereunder, no steps have been taken to
terminate any Pension Plan other than a standard termination under Section 4041(b) of ERISA, and no
contribution failure has occurred with respect to any Pension Plan sufficient to give rise to a
Lien under Section 302(f) of ERISA. No condition exists or event or transaction has occurred with
respect to any Pension Plan which could reasonably be expected to result in the incurrence by the
Borrowers or any member of the Controlled Group of any liability, fine or penalty which,
individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect.

     SECTION 6.12. Environmental Warranties. Except as set forth in Item 6.12 of
the Disclosure Schedule or the SEC Documents:

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     (a) all facilities and property (including underlying groundwater) owned or leased by
the Borrowers or any of their Subsidiaries has been, and continues to be, owned or leased by
the Borrowers and the Subsidiaries in compliance with all Environmental Laws except where
the failure to do so, individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect;

     (b) there have been no past, and there are no pending or (to the knowledge of the
Borrowers) threatened (i) claims, complaints, notices or requests for information received
by any Borrower or any of their Subsidiaries with respect to any alleged violation of any
Environmental Law, or (ii) complaints, notices or inquiries to the Borrowers or any of their
Subsidiaries regarding potential liability under any Environmental Law which, individually
or in the aggregate, could reasonably be expected to have a Material Adverse Effect;

     (c) there have been no Releases of Hazardous Materials at, on or under any property now
or previously owned or leased by the Borrowers or any of their Subsidiaries that have had,
or could reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect;

     (d) the Borrowers and each of their Subsidiaries has been issued and are in compliance
with all permits, certificates, approvals, licenses and other authorizations relating to
environmental matters, except where the failure to do so could not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect;

     (e) no property now or previously owned or leased by the Borrowers or any of their
Subsidiaries is listed or proposed for listing (with respect to owned property only) on the
National Priorities List pursuant to CERCLA, on the CERCLIS or on any similar State list of
sites requiring investigation or clean-up which, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect;

     (f) there are no underground storage tanks, active or abandoned, including petroleum
storage tanks, on or under any property now or previously owned or leased by the Borrowers
or any of their Subsidiaries that, individually or in the aggregate, have had, or could
reasonably be expected to have, a Material Adverse Effect;

     (g) neither the Borrowers nor any of their Subsidiaries has directly transported or
directly arranged for the transportation of any Hazardous Material to any location which is
listed or proposed for listing on the National Priorities List pursuant to CERCLA, on the
CERCLIS or on any similar State list or which is the subject of federal, State or local
enforcement actions or other investigations which may lead to material claims against the
Borrowers or any of their Subsidiaries for any remedial work, damage to natural resources or
personal injury, including claims under CERCLA which, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect;

     (h) there are no polychlorinated biphenyls or friable asbestos present at any property
now or previously owned or leased by the Borrowers or any of their Subsidiaries

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that, individually or in the aggregate, have had, or could reasonably be expected to
have, a Material Adverse Effect; and

     (i) no conditions exist at, on or under any property now or previously owned or leased
by the Borrowers or any of their Subsidiaries which, with the passage of time, or the giving
of notice or both, could reasonably be expected to give rise to material or contingent
liability under any Environmental Law which, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.

     SECTION 6.13. Accuracy of Information.

     (a) None of the factual information heretofore or contemporaneously furnished in
writing to any Secured Party by or on behalf of any Borrower or any Subsidiary of any
Borrower in connection with any Loan Document or any transaction contemplated hereby
contains any untrue statement of a material fact, or omits to state any material fact
necessary to make any information therein, in the light of the circumstances under which it
was made, not misleading, and no other factual information hereafter furnished in connection
with any Loan Document by or on behalf of any Borrower or any Subsidiary of any Borrower to
any Secured Party will contain any untrue statement of a material fact or will omit to state
any material fact necessary to make any information therein, in light of the circumstances
under which it was made, not misleading on the date as of which such information is dated or
certified, provided that, with respect to projected financial information otherwise
referred to in this Section 6.13, the Borrowers represent only that such information
was prepared in good faith based upon assumptions believed to be reasonable at the time.

     (b) All written information prepared by any consultant or professional advisor on
behalf of any Borrower or any Subsidiary of any Borrower which was furnished to the
Administrative Agent or any Lender in connection with the preparation, execution and
delivery of this Agreement has been reviewed by the Borrowers, and nothing has come to the
attention of the Borrowers in the context of such review which would lead them to believe
that such information (or the assumptions on which such information is based) is not, taken
as a whole, true and correct in all material respects or that such information therein,
taken as a whole, omits to state any material fact necessary to make such information, in
the light of the circumstances under which it was made, not misleading in any material
respect.

     (c) Insofar as the Projections or any of the information described above includes
assumptions, estimates, projections or opinions, the Borrowers have reviewed such matters
and nothing has come to the attention of the Borrowers in the context of such review which
would lead them to believe that such assumptions, estimates, projections or opinions omit to
state any material fact necessary to make such assumptions, estimates, projections or
opinions reasonable and not misleading in any material respect. All projections and
estimates have been prepared in good faith on the basis of reasonable assumptions.

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     SECTION 6.14. Regulations U and X. No Borrower or Subsidiary of a Borrower is engaged
in the business of extending credit for the purpose of purchasing or carrying margin stock, and no
proceeds of any Credit Extensions will be used to purchase or carry margin stock or otherwise for a
purpose which violates, or would be inconsistent with, F.R.S. Board Regulation U or Regulation X.
Terms for which meanings are provided in F.R.S. Board Regulation U or Regulation X or any
regulations substituted therefor, as from time to time in effect, are used in this Section
6.14 with such meanings.

     SECTION 6.15. Solvency. The Borrowers taken as a whole are, and each Borrower
individually is, Solvent.

     SECTION 6.16. Intellectual Property Collateral. With respect to any Intellectual
Property Collateral owned by the Borrowers or any of their Subsidiaries, the loss, impairment or
infringement of which, individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect:

     (a) such Intellectual Property Collateral is subsisting and has not been adjudged
invalid or unenforceable, in whole or in part;

     (b) such Intellectual Property Collateral is valid and enforceable;

     (c) the Borrowers and their Restricted Subsidiaries have made all necessary filings and
recordations to protect their respective interests in such Intellectual Property Collateral,
including (if permissible) recordations of all such interests in the Intellectual Property
Collateral in the United States Patent and Trademark Office and/or the United States
Copyright Office;

     (d) the Borrowers and their Restricted Subsidiaries are the owners of their respective
unencumbered right, title and interest in and to such Intellectual Property Collateral
(except for Liens created under the Loan Documents and Permitted Liens and except for rights
of licensees under licenses of such Intellectual Property Collateral in the ordinary course
of business) and, to the knowledge of the Borrowers, no claim has been made that the use of
such Intellectual Property Collateral does or may violate the asserted rights of any third
party except for claims that could not reasonably be expected to, individually or in the
aggregate, have a Material Adverse Effect; and

     (e) the Borrowers and their Restricted Subsidiaries have performed all acts and have
paid all required fees and taxes required to maintain the registrations and applications for
any such Intellectual Property Collateral that is material or necessary to the business of
any Borrower or any of their Restricted Subsidiaries.

     SECTION 6.17. Ownership of Stock. The Company owns (directly or indirectly) free and
clear of all Liens (other than the Liens securing the Obligations) 100% of the outstanding Capital
Securities (whether voting or non-voting) of each other Borrower and each Restricted Subsidiary of
each other Borrower, in each case on a fully diluted basis. There are no outstanding options,
warrants or convertible securities with respect to the Capital Securities of any Borrower (other
than the Company) or any Restricted Subsidiary of any Borrower.

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     SECTION 6.18. Material Contracts. There are no Material Contracts other than the
agreements listed in Item 6.18 of the Disclosure Schedule, as the same may be updated by
the Company from time to time pursuant to Section 7.1.1(c).

ARTICLE VII

COVENANTS

     SECTION 7.1. Affirmative Covenants. Until the Termination Date, each Borrower agrees
that it will, and will cause each of its Restricted Subsidiaries to, comply at all times with each
of the following covenants set forth below.

          7.1.1. Financial Information; Reports; Notices, etc. The Borrowers will furnish or
cause to be furnished to the Administrative Agent and each Lender copies of the following financial
statements, reports, notices and information:

     (a) (i) as soon as available and in any event within fifty (50) days after the end of
each of the first three Fiscal Quarters of each calendar year, an unaudited consolidated and
consolidating balance sheet of the Borrowers and their Subsidiaries as of the end of such
Fiscal Quarter and consolidated and consolidating statements of income and cash flow of the
Borrowers and their Subsidiaries for such Fiscal Quarter and for the period commencing at
the end of the previous calendar year and ending with the end of such Fiscal Quarter, and
including (in each case), in comparative form the figures for the corresponding Fiscal
Quarter in, and year to date portion of, the immediately preceding calendar year, certified
as complete and correct by the chief financial or accounting Authorized Officer of the
Company or the Treasurer or any Assistant Treasurer of the Company and (ii) as soon as
available and in any event within thirty (30) days after the end of each calendar month
(starting with the calendar month ended March 31, 2007), a copy of the consolidated and
consolidating balance sheet of the Borrowers and their Subsidiaries as of the end of such
calendar month, and the related consolidated and consolidating statements of income and cash
flow of the Borrowers and their Subsidiaries for such calendar month and for the period
commencing at the end of the previous calendar year and ending with the end of such calendar
month, and, in each case the consolidated balance sheet and statements of income and cash
flow shall set forth in comparative form (x) the figures for the same period from the
Projections and (y) monthly accounting periods ending in the immediately preceding calendar
year and certified by the chief financial or chief accounting Authorized Officer of the
Company or the Treasurer or any Assistant Treasurer of the Company;

     (b) as soon as available and in any event within ninety (90) days after the end of each
calendar year (starting with the calendar year ending December 31, 2007), a copy of the
consolidated and unaudited consolidating balance sheet of the Borrowers and their
Subsidiaries, and the related consolidated and consolidating statements of income and cash
flow of the Borrowers and such Subsidiaries for such calendar year, setting forth in
comparative form the figures for the immediately preceding calendar year, audited (without
any Impermissible Qualification) by independent public accountants of recognized national
standing and stating that such consolidated financial statements present fairly the
consolidated financial condition as of the end of such calendar year, and

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the consolidated results of operations and cash flows for such calendar year, of the
Borrowers and their Subsidiaries in accordance with GAAP, applied on a consistent basis;
provided, however that any consolidating statements delivered pursuant to
this clause shall be unaudited;

     (c) as soon as available and in any event within fifteen (15) days after the end of
each calendar month, together with an updated Item 6.18 of the Disclosure Schedule,
together with copies of any such new Material Contracts (if necessary), a Borrowing Base
Certificate dated and reflecting amounts as of the close of business on the last day of such
calendar month, together with supporting documentation for any and all BP Accounts included
within such Borrowing Base Certificate (which supporting documentation shall be in form and
scope reasonably satisfactory to the Administrative Agent); provided,
however, that, notwithstanding anything to the contrary contained herein, during any
period in which Excess Availability is less than $15,000,000, (i) the Borrowers will
deliver, in addition to the foregoing monthly Borrowing Base Certificate, no less frequently
than the last Business Day of each calendar week, a Borrowing Base Certificate dated and
reflecting amounts as of the close of business on the last day of the preceding calendar
week (provided that such weekly Borrowing Base Certificate shall be calculated based
on a methodology agreed upon between the Company and the Administrative Agent) and (ii) the
Administrative Agent shall have the right in its discretion to require the Company to change
the frequency of delivery of Borrowing Base Certificates;

     (d) as soon as possible and in any event within three (3) Business Days after any
Borrower obtains knowledge of the occurrence of a Default, a statement of an Authorized
Officer of the Company setting forth details of such Default and the action which the
Borrowers or any of them have taken and/or propose to take with respect thereto;

     (e) as soon as possible and in any event within three (3) Business Days after the
Borrowers obtain knowledge of (i) the occurrence of any adverse development with respect to
any litigation, arbitration action, governmental investigation or proceeding or labor
controversy or (ii) the commencement of any litigation, action, proceeding or labor
controversy, in either of such cases which could reasonably be expected to have a Material
Adverse Effect, notice thereof and, to the extent the Administrative Agent requests, copies
of all documentation relating thereto;

     (f) promptly after the sending or filing thereof, copies of all reports, notices,
prospectuses and registration statements which any Borrower or any Subsidiary of any
Borrower files with the SEC or any national securities exchange;

     (g) promptly upon becoming aware of (i) the institution of any steps by any Person to
terminate any Pension Plan other than a standard termination under 4041(b) of ERISA, (ii)
the failure to make a required contribution to any Pension Plan if such failure is
sufficient to give rise to a Lien under Section 302(f) of ERISA, (iii) the taking of any
action with respect to a Pension Plan which could result in the requirement that any
Borrower or any Restricted Subsidiary furnish a bond or other security to the PBGC or

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such Pension Plan, or (iv) the occurrence of any event with respect to any Pension Plan
which could result in the incurrence by any Borrower or any Restricted Subsidiary of any
material liability, fine or penalty, notice thereof and copies of all documentation relating
thereto;

     (h) promptly upon receipt thereof, copies of all “management letters” submitted to the
Borrowers or any Subsidiary of any Borrower by the independent public accountants referred
to in clause (b) of this Section 7.1.1 in connection with each audit made by
such accountants;

     (i) promptly following the mailing or receipt of any notice or report delivered under
the terms of the Senior Secured Note Documents, copies of such notice or report;

     (j) as of such dates as are designated by the Administrative Agent, the Borrowers shall
make available to the Administrative Agent all information as is necessary for the
Administrative Agent or a designee thereof to prepare a collateral report with respect to
the Eligible Accounts and Eligible Inventory components included in the Borrowing Base
Amount and such other information or materials as the Administrative Agent shall make the
scope of such examination, and the Borrowers shall pay all reasonable travel and other out
of pocket costs incurred by the Administrative Agent or its affiliates with respect to such
collateral reports;

     (k) a summary of the insurance coverages of the Borrowers and their Restricted
Subsidiaries in form and substance reasonably satisfactory to the Administrative Agent; upon
renewal of any such insurance policy, a copy of an insurance certificate summarizing the
terms of such policy; and upon request of the Administrative Agent, copies of the applicable
policies;

     (l) such other financial and other information as any Lender or Issuer through the
Administrative Agent may from time to time reasonably request;

     (m) on or before the date which is thirty (30) days prior to the commencement of each
calendar year of the Company, updated projections (including balance sheets, income
statements and statements of cash flows) for each month occurring during the succeeding
twelve-month period (the “Projections”);

     (n) promptly upon the occurrence thereof (and in any event within three (3) Business
Days), notice of (i) any amendment or replacement of any Material Contract on terms or
conditions which are, in the aggregate, less favorable to the Borrowers in any material
respect than the terms and conditions existing with respect to such Material Contract prior
to such amendment or replacement, (ii) any termination of any Material Contract, (iii) any
Material Adverse Effect or (iv) any plans to shut down, or cease production from, any
facility at the Texas City Facility (excluding normal recurring shutdowns for maintenance
purposes or any other shutdown that is not expected to last more than thirty (30)
consecutive days); and

     (o) if the Company has designated any of its Subsidiaries as Unrestricted Subsidiaries,
then the quarterly and annual financial information required by clauses (a)

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and (b) of this Section 7.1.1 will include a reasonably detailed
presentation, either on the face of the financial statements or in the footnotes thereto, of
the financial condition and results of operations of the Company and its Restricted
Subsidiaries separate from the financial condition and results of operations of the
Unrestricted Subsidiaries of the Company; provided that the requirements of this
clause (o) shall not apply if the Company’s reports filed with the SEC contain in all
material respects the information required in this paragraph.

          7.1.2. Maintenance of Existence; Compliance With Laws, etc. Each of the Borrowers
will, and will cause each of its Restricted Subsidiaries to,

     (a) except as otherwise permitted by Section 7.2.9, preserve and maintain its
legal existence; and

     (b) comply in all material respects with all applicable laws, rules, regulations and
orders, including the payment (before the same become delinquent), of all Taxes and
governmental charges imposed upon any of the Borrowers or any of their Subsidiaries or upon
their Properties, except for the payment of any Taxes or governmental charges which are
being diligently contested in good faith by appropriate proceedings and for which adequate
reserves in accordance with GAAP have been set aside on the books of the applicable Borrower
or Subsidiary; provided, however, that the failure of any Borrower or any
Restricted Subsidiary to cause any Unrestricted Subsidiary to comply with this clause
(b) shall only be a breach of this clause (b) if such failure could reasonably
be expected to have a Material Adverse Effect.

          7.1.3. Maintenance of Properties. Each of the Borrowers will, and will cause each of
their Restricted Subsidiaries to, maintain, preserve, protect and keep its and their respective
Properties in good repair, working order and condition (ordinary wear and tear excepted), and make
necessary repairs, renewals and replacements so that the business carried on by the Borrowers and
their Restricted Subsidiaries may be properly conducted at all times, unless the Borrowers have
determined in good faith that the continued maintenance of such Property is no longer economically
desirable (provided that any such determination with respect to any Property material to
the operations of any Borrower or any Restricted Subsidiary of any Borrower shall be made only
after consultation with the Administrative Agent).

          7.1.4. Insurance. Each of the Borrowers will, and will cause each of their Restricted
Subsidiaries to:

     (a) maintain insurance on its property with financially sound and reputable insurance
companies against loss and damage in at least the amounts (and with only those deductibles)
customarily maintained, and against such risks as are typically insured against in the same
general area, by Persons of comparable size engaged in the same or similar business as the
Borrowers and their Restricted Subsidiaries; and

     (b) all worker’s compensation, employer’s liability insurance or similar insurance as
may be required under the laws of any state or jurisdiction in which it may be engaged in
business.

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Without limiting the foregoing, all insurance policies required pursuant to this Section
7.1.4 for the Borrowers and their Restricted Subsidiaries shall (i) list the Administrative
Agent on behalf of the applicable Secured Parties as mortgagee (in the case of property insurance)
or additional insured (in the case of liability insurance), as applicable, and provide that no
cancellation or modification of the policies will be made without 30 days’ prior written notice to
the Administrative Agent (provided that the Borrowers shall have five (5) Business Days
after notice from the Administrative Agent to correct any insurance policy delivered to the
Administrative Agent which does not comply with this clause (i)), and (ii) be in addition to any
requirements to maintain specific types of insurance contained in the other Loan Documents.

          7.1.5. Books and Records. Each of the Borrowers will, and will cause each of their
Subsidiaries to, keep books and records in accordance with GAAP which accurately reflect all of its
business affairs and transactions and permit each Secured Party or any of their respective
representatives, at reasonable times and intervals upon reasonable notice to the Company, to visit
the offices of each Borrower to discuss such Borrower’s financial matters with its officers and
employees, and its independent public accountants (and each Borrower hereby authorizes such
independent public accountant to discuss the financial matters of the Borrowers and the Restricted
Subsidiaries of the Borrowers with each Secured Party or their representatives whether or not any
representative of such Person is present) and to examine (and photocopy extracts from) any of its
books and records. The Borrowers shall jointly and severally pay any fees of such independent
public accountant incurred in connection with the Administrative Agent’s exercise of its rights
pursuant to this Section 7.1.5 at any time and any other Secured Party’s exercise of their rights
pursuant to this Section 7.1.5 if a Default has occurred and is continuing.

          7.1.6. Post-Closing Requirements. The Borrowers will satisfy the requirements set
forth on Schedule VI on or before the date specified for such requirement or such later
date to be determined by the Administrative Agent.

          7.1.7. Use of Proceeds. Each Borrower will apply the proceeds of Credit Extensions
for working capital and general corporate purposes of the Borrowers consistent with this Agreement
and for issuing Letters of Credit for the account of the Borrowers.

          7.1.8. Borrowers; Security; etc. Each Borrower will, and will cause each Restricted
Subsidiary that is not a Foreign Subsidiary to, execute any documents, financing statements,
agreements and/or instruments, and take all further action (including filing financing statements)
that may be required under applicable law, or that the Administrative Agent may reasonably request,
in order to effectuate the transactions contemplated by the Loan Documents and in order to grant,
preserve, protect and perfect the validity and first priority of the security interests created or
intended to be created by the Loan Documents (subject to Permitted Liens). Each Borrower will
cause any subsequently acquired or created Restricted Subsidiary, that is not a Foreign Subsidiary,
to become a party to this Agreement, as a “Borrower” hereunder, and to execute and deliver to the
Administrative Agent a Joinder Agreement and each other applicable Loan Document (including a
supplement to the applicable Security Agreement) in favor of the Secured Parties. In addition,
from time to time, the Borrowers will, at their cost and expense, promptly secure the Obligations
by pledging or creating, or causing to be pledged or created, perfected security interests with
respect to any now existing or hereinafter created or acquired

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Collateral, it being understood that it is the intent of the Secured Parties that the
Obligations shall be secured by all Collateral owned by any Borrower and any Restricted Subsidiary
of any Borrower, other than any Foreign Subsidiaries. Such security interests and Liens will be
created under the Loan Documents in form and substance satisfactory to the Administrative Agent,
and each Borrower shall deliver or cause to be delivered to the Lenders all such instruments and/or
documents (including legal opinions, and lien searches) as the Administrative Agent shall
reasonably request to evidence compliance with this Section 7.1.8.

          7.1.9. Controlled Deposit Accounts. Each applicable Borrower shall provide
instructions to the appropriate Person as often as necessary to ensure that any and all Receipts of
the Borrowers and the Restricted Subsidiaries (other than any Foreign Subsidiary) are deposited
into Controlled Deposit Accounts; and no Borrower shall close or transfer any Controlled Deposit
Account, or, except as otherwise permitted in Section 7.2.18, open any new deposit account
(a) with any financial institution other than an Approved Depository Bank, (b) without the prior
written consent of the Administrative Agent and (c) without causing the bank where such Controlled
Deposit Account or new deposit account has been opened to be subject to a Control Agreement.

          7.1.10. Environmental Covenant. Each Borrower will, and will cause each of its
Subsidiaries to,

     (a) use and operate all of its facilities and Properties in compliance in all material
respects with all Environmental Laws, keep (and, when applicable, obtain in a timely manner)
all necessary material permits, approvals, certificates, licenses and other authorizations
relating to environmental matters in effect and remain in compliance in all material
respects therewith, and handle all Hazardous Materials (including the disposition and
storing thereof) in compliance with all applicable Environmental Laws which in the good
faith judgment of the Company are of a material nature, except in each case where the
failure to do so could not reasonably be expected to have a Material Adverse Effect;

     (b) promptly notify the Administrative Agent and provide copies upon receipt of all
written claims, complaints, notices or inquiries from third parties relating to Releases of
Hazardous Materials from its facilities and Properties or compliance with Environmental Laws
which in the good faith judgment of the Company are of a material nature and which,
individually or in the aggregate, could reasonably be expected to have a Material Adverse
Effect; and

     (c) provide such information and certifications which the Administrative Agent may
reasonably request from time to time to evidence compliance with this Section
7.1.10.

          7.1.11. As to Intellectual Property Collateral. No Borrower shall, nor shall any
Borrower permit any of its Restricted Subsidiaries to, except in the exercise of its reasonable
business judgment, do any act, or omit to do any act, whereby any item of material Intellectual
Property Collateral may lapse or become abandoned or dedicated to the public or unenforceable other
than upon the natural expiration of protective periods under applicable law. In addition, each of
the Borrowers shall, and shall cause each of their Restricted Subsidiaries to:

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     (a) notify the Administrative Agent as soon as practicable if it knows that any
application or registration relating to any material item of the Intellectual Property
Collateral may become abandoned or dedicated to the public or placed in the public domain or
invalid or unenforceable (other than upon the natural expiration of protective periods under
applicable law), or of any adverse determination or development (including the institution
of, or any such determination or development in, any proceeding in the United States Patent
and Trademark Office or the United States Copyright Office) regarding the ownership by any
Borrower or any Restricted Subsidiary of any material item of the Intellectual Properly
Collateral or any Borrower’s or any of its Restricted Subsidiaries’ right to register the
same or to keep and maintain and enforce the same;

     (b) except for any Foreign Subsidiary, not file any application for the registration of
any Intellectual Property Collateral with the United States Patent and Trademark Office or
the United States Copyright Office, unless it promptly informs the Administrative Agent, and
upon request of the Administrative Agent, executes and delivers any and all agreements,
instruments, documents and papers as the Administrative Agent may reasonably request to
evidence the Administrative Agent’s security interest in such Intellectual Property
Collateral and the goodwill and general intangibles of any Borrower or any Restricted
Subsidiary (other than any Foreign Subsidiary) relating thereto or represented thereby.

     (c) unless it is otherwise determined in the exercise of their reasonable business
judgment, take all necessary steps, including in any proceeding before the United States
Patent and Trademark Office or the United States Copyright Office, to maintain and pursue
any application (and to obtain the relevant registration) filed with respect to, and to
maintain any registration of, any material item of the Intellectual Property Collateral,
including the filing of applications for renewal, affidavits of use, affidavits of
incontestability and opposition, interference and cancellation proceedings and the payment
of fees and taxes (except to the extent that dedication, abandonment or invalidation is
permitted under the foregoing clause (a) or (b) of this Section
7.1.11).

          7.1.12. Designation of Restricted and Unrestricted Subsidiaries.

     (a) The Board of Directors of the Company may designate any Restricted Subsidiary to be
an Unrestricted Subsidiary if (i) no Default has occurred that is continuing and (ii) that
designation would not otherwise breach this Agreement, the Indenture or cause a Default. If
a Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate Fair
Market Value (as defined in the Indenture) of all outstanding Investments (other than
Investments consisting of Non-Facility Assets) owned by the Company and its Restricted
Subsidiaries in the Subsidiary designated as an Unrestricted Subsidiary will be deemed to be
an Investment made as of the time of the designation and will reduce the amount available
for Investments under clause (k) and/or clause (n) of Section 7.2.4
hereof (without duplication of any previous reductions in any “basket” in Section
7.2.4 as a result of such Investment). That designation will only be permitted if the
Investment would be permitted at that time and if the Restricted Subsidiary otherwise meets
the definition of an Unrestricted Subsidiary. The Board of

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Directors of the Company may redesignate any Unrestricted Subsidiary to be a Restricted
Subsidiary if that redesignation would not cause a Default.

     (b) Any designation of a Subsidiary of the Company as an Unrestricted Subsidiary will
be evidenced to the Administrative Agent by filing with the Administrative Agent a certified
copy of the resolution of the Board of Directors of the Company giving effect to such
designation and an officers’ certificate certifying that such designation complied with the
definition of Unrestricted Subsidiary, the preceding conditions and was permitted by
Section 7.2.4. If, at any time, any Unrestricted Subsidiary would fail to meet the
preceding requirements as an Unrestricted Subsidiary, it will thereafter cease to be an
Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness of such
Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Company as of
such date and, if such Indebtedness is not permitted to be incurred as of such date under
Section 7.2.2, the Company will be in breach of such covenant, and thereby an Event
of Default under Section 8.1.3 shall occur. The Board of Directors of the Company
may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary;
provided that such designation will be deemed to be an incurrence by a Restricted
Subsidiary of the Company of any outstanding Indebtedness of such Unrestricted Subsidiary
and such designation will be permitted only if (1) such Indebtedness is permitted under
Section 7.2.2; and (2) no Default or Event of Default would be in existence
following such designation.

     (c) Upon any designation of any Restricted Subsidiary as an Unrestricted Subsidiary in
accordance with Sections 7.1.12(a) and (b) above, (i) automatically and
without any further action by the Administrative Agent or any other Person, such former
Restricted Subsidiary shall be discharged and released from any of its Obligations as, and
shall no longer be, a Borrower hereunder; (ii) any Liens of the Secured Parties on any
assets of, or on any Capital Stock of, such Restricted Subsidiary will, automatically and
without any further action by the Administrative Agent or any other Person, be released,
terminated and discharged; and (iii) the Administrative Agent, on behalf of all Secured
Parties, will promptly, upon the request and at the expense of the Company, execute and
deliver such documents and instruments as the Company may reasonably request to evidence and
effect the matters specified in clauses (i) and (ii).

     SECTION 7.2. Negative Covenants. Until the Termination Date, each Borrower covenants
and agrees with each Lender, each Issuer and the Administrative Agent that each Borrower will, and
will cause each of its Restricted Subsidiaries to, perform or cause to be performed the obligations
set forth below.

          7.2.1. Business Activities. No Borrower will, nor will any Borrower permit any of its
Restricted Subsidiaries to, engage in any business activity except those business activities
engaged in on the Closing Date and business activities reasonably related or incidental thereto or
any business or activity carried out or performed utilizing any of the Non-Facility Assets.

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          7.2.2. Indebtedness. The Borrowers will not, and will not permit any of their
Restricted Subsidiaries to, create, incur, assume or permit to exist any Indebtedness, other than
(without duplication):

     (a) Indebtedness in respect of the Obligations;

     (b) Indebtedness of the Company evidenced by the Existing Senior Secured Notes, and
Indebtedness of any other Borrower in respect of its guaranty of such Senior Secured Notes,
provided that such Indebtedness is repaid in full within 31 days after the Closing
Date;

     (c) unsecured Indebtedness (i) incurred in the ordinary course of business of the
Borrowers and their Restricted Subsidiaries (including open accounts extended by suppliers
on normal trade terms in connection with purchases of goods and services which are not
overdue for a period of more than ninety (90) days or, if overdue for more than ninety (90)
days, as to which a good faith dispute exists and adequate reserves in conformity with GAAP
have been established on the books of such Borrower or such Restricted Subsidiary), (ii) in
respect of performance, surety, environmental assurance or appeal bonds provided in the
ordinary course of business or (iii) in respect of workers’ compensation claims, payment
obligations in connection with health or other types of social security benefits,
unemployment or other insurance or self-insurance obligations or indemnification, adjustment
of purchase price or similar obligations incurred in connection with the disposition of any
business or assets, but excluding (in each case), Indebtedness for borrowed money or
Contingent Liabilities in respect thereof;

     (d) Capitalized Lease Liabilities; provided, that the aggregate amount of all
Indebtedness outstanding pursuant to this clause (d) shall not at any time exceed
$5,000,000 in the aggregate in any calendar year;

     (e) obligations for current Taxes which are not yet due or are being contested in good
faith by appropriate action or proceeding promptly initiated and diligently conducted, if
such reserve as shall be required by GAAP shall have been made therefore and so long as no
Liens, individually or in the aggregate, in excess of $2,000,000 outstanding at any one time
have been filed with respect to such Indebtedness;

     (f) Indebtedness of the Company evidenced by the Senior Secured Notes, and Indebtedness
of any other Borrower in respect of its guaranty of such Senior Secured Notes and, subject
to the terms and conditions of Section 7.2.7, refinancings of such Indebtedness on
No Less Favorable Terms and Conditions;

     (g) Indebtedness in respect of Hedging Obligations entered into in the ordinary course
of business;

     (h) Indebtedness for the construction or acquisition of property used in the ordinary
course of business of the Borrowers and their Restricted Subsidiaries (provided,
that such Indebtedness is incurred within 60 days of the commencement of construction or
acquisition) in an amount not to exceed $2,000,000 in the aggregate in any calendar year;

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     (i) Indebtedness solely represented by premium financing or similar deferred payment
obligations incurred with respect to insurance policies purchased in the ordinary course of
business and consistent with past practice, provided that such premium financing or
similar deferred payment obligations do not impact the insurance coverage relating thereto;

     (j) the guarantee by a Borrower or any Restricted Subsidiary of Indebtedness of a
Borrower that was permitted to be incurred by another provision of this covenant;
provided that if the Indebtedness being guaranteed is subordinated in right of
payment to the Loans, then the guarantee shall be subordinated in right of payment to the
same extent as the Indebtedness guaranteed;

     (k) the guarantee by any Restricted Subsidiary that is not a Borrower of Indebtedness
of a Borrower or any other Restricted Subsidiary that was permitted to be incurred by
another provision of this covenant;

     (l) the incurrence by a Borrower or any of the Restricted Subsidiaries of Indebtedness
arising from the honoring by a bank or other financial institution of a check, draft or
similar instrument inadvertently (except in the case of daylight overdrafts) drawn against
insufficient funds; provided, however, that such Indebtedness is
extinguished within three (3) Business Days of incurrence;

     (m) the incurrence by a Borrower or any Restricted Subsidiary of unsecured intercompany
Indebtedness between or among a Borrower and any Restricted Subsidiary; provided,
however, that:

     (i) if any Borrower is the obligor on such Indebtedness and the payee is not a
Borrower, such Indebtedness must be (i) permitted as an Investment pursuant to
Section 7.2.4 and (ii) expressly subordinated to the prior payment in full
in cash of all Obligations then due; and

     (ii) upon any subsequent issuance or transfer of Capital Securities that
results in any such Indebtedness being held by a Person other than a Borrower or a
Restricted Subsidiary and any sale or other transfer of any such Indebtedness to a
Person that is not a Borrower or, in the case where the payor on such intercompany
Indebtedness is not a Borrower, any Restricted Subsidiary, such event will be
deemed, in each case, to constitute an incurrence of such Indebtedness by the
Borrowers or such Restricted Subsidiary, as the case may be, that was not permitted
by this clause (m); and

     (n) other Indebtedness incurred in the ordinary course of business in an aggregate
amount at any time outstanding not to exceed $5,000,000; provided, however,
that to the extent that any such Indebtedness is secured by a Lien, (i) such Lien is
permitted under Section 7.2.3, and (ii) the amount of such Indebtedness, together
with all other secured Indebtedness incurred pursuant to this clause (n), does not exceed
$2,500,000.

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provided, however, that no Indebtedness otherwise permitted by clauses (c),
(d), (f), (g), (h) or (n) shall be assumed or otherwise
incurred if a Default has occurred and is then continuing or would result therefrom.

          7.2.3. Liens. No Borrower will, nor will any Borrower permit any of its Restricted
Subsidiaries to, create, incur, assume or permit to exist any Lien upon any of its Properties
(including revenues and any Capital Securities of any Person), whether now owned or hereafter
acquired, except the following (collectively, “Permitted Liens”):

     (a) Liens securing payment of the Obligations;

     (b) Liens existing as of the Closing Date and disclosed in Item 7.2.3(b) of the
Disclosure Schedule, and extensions thereof and refinancings of such Indebtedness;
provided, that no such Lien that secures Indebtedness shall encumber any additional
property and the amount of Indebtedness secured by such Lien is not increased from that
existing on the Closing Date (as such Indebtedness may have been permanently reduced
subsequent to the Closing Date);

     (c) (i) Liens on the Indenture Collateral securing the Senior Secured Notes or, subject
to clause (g) of Section 7.2.2 and Section 7.2.7, extensions,
re-grants or renewals thereof in connection with any refinancing of the Senior Secured Notes
on No Less Favorable Terms and Conditions, (ii) Liens on the Indenture Collateral (or on
cash or Cash Equivalent Investments deposited in trust with the trustee under the Existing
Indenture for redemption of the Existing Senior Secured Notes) securing the Existing Senior
Secured Notes, provided that the Indebtedness secured by such Liens is repaid in
full no later than the 31st day after the Closing Date, and (iii) Liens on the Collateral
securing the Senior Secured Notes or, subject to clause (g) of Section 7.2.2
and Section 7.2.7, extensions, re-grants or renewals thereof in connection with any
refinancing of the Senior Secured Notes on No Less Favorable Terms and Conditions,
provided that such Liens are subordinated to the Liens on the Collateral securing
the Obligations in accordance with the Intercreditor Agreement;

     (d) Liens on assets of the Borrowers securing Indebtedness of the type permitted under
clauses (d) and (h) of Section 7.2.2; provided, that (i)
such Liens are granted within 60 days after such Indebtedness is incurred, (ii) the
Indebtedness secured thereby does not exceed 80% of the lesser of the cost or the fair
market value of the applicable property, improvements or equipment at the time of such
lease, acquisition or construction and (iii) such Lien secures only the assets that are the
subject of the Indebtedness referred to in such clause;

     (e) Liens in favor of customs officials, revenue officials, carriers, warehousemen,
mechanics, repairmen, workmen, crews, materialmen and landlords, maritime Liens and other
Liens imposed by law granted or imposed in the ordinary course of business for amounts not
yet due or payable or being diligently contested in good faith by appropriate proceedings
and for which adequate reserves in accordance with GAAP shall have been set aside on the
books of the Borrowers;

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     (f) Liens incurred or deposits made in the ordinary course of business in connection
with worker’s compensation, unemployment insurance or other forms of governmental insurance
or benefits, or to secure performance of tenders, statutory obligations, environmental
assurance, surety and appeal bonds, government contracts, performance bonds, bids, leases or
other similar obligations entered into in the ordinary course of business (exclusive of
obligations for the payment of borrowed money);

     (g) judgment Liens in existence for less than 45 days after the entry thereof or with
respect to which execution has been stayed or the payment of which is covered in full
(subject to a customary deductible) by insurance maintained with responsible insurance
companies and which do not otherwise result in an Event of Default under Section
8.1.6;

     (h) Permitted Real Estate Liens;

     (i) Liens for Taxes (i) not at the time delinquent or (ii) which are being contested in
good faith by appropriate action or proceeding promptly initiated and diligently conducted,
if (in the case of Liens under this clause (ii)) such reserves as shall be required by GAAP
shall have been made therefore and so long as such Liens, individually or in the aggregate,
do not secure Indebtedness in excess of $2,000,000 outstanding at any one time;

     (j) ordinary course of business Liens not described above or in the definition of
Permitted Real Estate Liens that in any case do not secure any Indebtedness and that are not
prior to any Liens on the Collateral securing the Obligations in an amount not to exceed
$2,000,000 in the aggregate;

     (k) Liens on assets (other than Collateral) that are the subject of capital projects
between the Company and a third party that has production, operating or similar agreements
with the Company, provided that such Liens are expressly limited to the assets
directly financed by such third party for such capital project;

     (l) Liens on assets (other than Collateral) incurred in the ordinary course of business
of the Company and its Restricted Subsidiaries that do not secure Indebtedness and the value
of which assets covered by such Liens do not exceed $10,000,000 in the aggregate;

     (m) Liens of the Non-Facility Assets;

     (n) Liens incurred in the ordinary course of business of the Borrowers and the
Restricted Subsidiaries with respect to obligations that do not exceed $2,500,000 at any one
time outstanding; and

     (o) other Liens consented to by Required Lenders.

In addition, notwithstanding anything to the contrary contained in this Agreement or in any other
Loan Document, no Borrower will, nor will any Borrower permit any of its Restricted Subsidiaries to
grant, create, incur, assume or otherwise permit to exist any Liens on any

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Accounts, any inventory or any Capital Securities of any Restricted Subsidiary of any Borrower or
on any dividends or other proceeds therefrom, other than Liens securing the Obligations.

          7.2.4. Investments. The Borrowers will not, and will not permit any of their
Restricted Subsidiaries to, purchase, make, incur, assume or permit to exist any Investment in any
other Person, other than the following (collectively, “Permitted Investments”):

     (a) Investments existing on the Closing Date and identified in Item 7.2.4(a) of
the Disclosure Schedule;

     (b) the Company or any Restricted Subsidiary may make Investments in the Company or the
other Borrowers which are Wholly-Owned Subsidiaries of the Company;

     (c) Cash Equivalent Investments;

     (d) the Borrowers may make Investments received in connection with the bankruptcy or
reorganization of, or settlement of delinquent accounts and disputes with, customers and
suppliers, in each case in the ordinary course of business;

     (e) the Borrowers may make Investments which are Capital Expenditures;

     (f) the Borrowers may make Investments in Persons constituting (i) accounts receivable
arising, (ii) trade debt granted, or (iii) deposits made in connection with the purchase
price of goods or services, in each case, in the ordinary course of business;

     (g) the Borrowers may make Investments consisting of routine loans or advances to
employees of such Borrower (including payroll, travel and related expenses) in the ordinary
course of business not to exceed $25,000 at any time outstanding to any one employee and
$500,000 in the aggregate;

     (h) Investments consisting of loans to finance the purchase of homes by employees who
have been relocated by any Borrower or any Restricted Subsidiary of any Borrower in an
aggregate principal amount outstanding at any one time not to exceed $500,000;

     (i) Investments in Senior Secured Notes; provided that, both before and
immediately after any such Investment, no Loans are outstanding;

     (j) the Borrowers may make Investments consisting of any deferred portion of the sales
price or any non-cash portion of the consideration received by any Borrower in connection
with any Disposition permitted under Section 7.2.10;

     (k) Investments in Unrestricted Subsidiaries and other Persons to the extent such
Investments consist of (a) Non-Facility Assets or (b) other assets having an aggregate Fair
Market Value (as defined in the Indenture and measured on the date each such Investment was
made and without giving effect to subsequent changes in value), when taken together with all
other Investments made pursuant to this clause (k) that are at the time outstanding,
not to exceed $2,000,000;

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     (l) any Investment made solely in exchange for the issuance of Capital Securities of
the Company; provided that such Capital Securities do not constitute Disqualified
Stock (as defined in the Indenture);

     (m) Investments represented by Hedging Obligations; provided, however ̧
that the Indebtedness thereunder is permitted by Section 7.2.2;

     (n) the Borrowers may make other Investments (including Investments in Unrestricted
Subsidiaries and Restricted Subsidiaries) which do not exceed $3,000,000 in the aggregate at
any time outstanding; and

     (o) any Investment that extends, renews, defeases, discharges, replaces, refinances or
refunds an existing Investment; provided, that the new Investment is in an amount that does
not exceed the amount replaced, refinanced or refunded, and is made in the same Person as
the Investment replaced, refinanced or refunded;

provided, however, that (x) any Investment which when made complies with the
requirements of clauses (a), (b) or (c) of the definition of the term “Cash Equivalent Investment”
may continue to be held notwithstanding that such Investment if made thereafter would not comply
with such requirements and (y) no Investment otherwise permitted by clauses (e),
(f), (g), (h), (i), (j), (k) or (n) shall
be permitted to be made if any Default has occurred and is continuing or would result therefrom and
(z) with respect to any Investment, the Company may, in its sole discretion, allocate all or any
portion of any Investment to one or more of the above clauses (a) through (o) so that all or a
portion of the Investment would be a Permitted Investment.

          7.2.5. Restricted Payments, etc. The Borrowers will not, and will not permit any of
their Restricted Subsidiaries to, declare or make a Restricted Payment, or make any deposit for any
Restricted Payment, other than Restricted Payments made by any Borrower to another Borrower or by
any Restricted Subsidiaries to any Borrowers, except that the Company may declare and deliver
dividends payable solely in (a) shares of its Capital Securities or in options, warrants or rights
to purchase shares of its Capital Securities or (b) any cash in lieu of fractional shares which is
payable on its preferred stock in accordance with the terms of the Company’s Organic Documents as
in effect as of the Closing Date.

          7.2.6. Fixed Charge Coverage Ratio. The Borrowers will not, on any Measurement Date,
permit the Fixed Charge Coverage Ratio to be less than 1.00 to 1.00 (as measured on such
Measurement Date for the trailing twelve-month period). Additionally, the Borrowers will not, on
the date any Credit Extension is to be made on which Excess Availability, after giving pro forma
effect to such Credit Extension, is less than $10,000,000 (as determined based upon Excess
Availability as calculated in the last Borrowing Base Certificate delivered to the Administrative
Agent, giving pro forma effect to all Credit Extensions and repayments of Loans since such
Borrowing Base Certificate), permit the Fixed Charge Coverage Ratio to be less than 1.00 to 1.00
(as measured on the date of such Credit Extension for the most recent trailing twelve-month period
for which financial statements are available).

          7.2.7. No Prepayment of Senior Secured Notes. The Borrowers will not, and will not
permit any of their Restricted Subsidiaries to, refinance, make any payment or

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prepayment of principal of, or premium or interest on, the Senior Secured Notes or any other
Indebtedness, other than the Obligations and any Indebtedness permitted under clauses (b),
(c), (d), (g), (h), (i), (m) or (n) of
Section 7.2.2; or redeem, retire, purchase, defease or otherwise acquire any of the Senior
Secured Notes or any such other Indebtedness; or make any deposit (including the payment of amounts
into a sinking fund or other similar fund) for any of the foregoing purposes, except (a)
provided no Default then exists or will result therefrom, the Borrowers may make regularly
scheduled interest payments on the Senior Secured Notes, and (b) provided no Default then
exists or would result therefrom, the Borrowers may make an Event of Loss Offer and/or an Asset
Sale Offer pursuant to and as required by Section 4.16 and/or Section 4.17 of the Indenture and
purchase the principal amount of the Senior Secured Notes required to be purchased pursuant to
Sections 4.16 and/or Section 4.17 of the Indenture or refinance the Senior Secured Notes on No Less
Favorable Terms and Conditions, provided, further that (i) with respect to any
Asset Sale Offer, the Disposition relating to such Asset Sale Offer was permitted to be made under
the Loan Documents, (ii) with respect to any Event of Loss Offer and/or Asset Sale Offer, any Net
Loss Proceeds and/or Net Proceeds with respect to such casualty, condemnation and/or Disposition
have been paid to the Administrative Agent and/or deposited into a Controlled Deposit Account to be
applied as provided in this Agreement, as the case may be, other than any Net Loss Proceeds and/or
Net Proceeds received from any casualty, condemnation and/or Disposition of Indenture Collateral
(but excluding in all cases any proceeds of Collateral), and (iii) with respect to any Event of
Loss Offer and/or Asset Sale Offer of the Senior Secured Notes, the Borrowers have delivered
evidence satisfactory to the Administrative Agent and certified to by the chief financial or
accounting Authorized Officer of the Company that the sum of (x) Excess Availability, plus
(y) the cash on hand which is on deposit with an Approved Depository Bank that is subject to a
Control Agreement will, immediately after such purchase of the Senior Secured Notes, be equal to or
greater than $30,000,000 and is reasonably expected to continue to be equal to or greater than
$30,000,000 for the 180 day period immediately following such purchase of the Senior Secured Notes.

          7.2.8. Capital Securities. The Borrowers will not, and will not permit any of their
Restricted Subsidiaries to, (a) authorize or issue any Capital Securities (whether for value or
otherwise) to any Person, other than (i) to any Borrower and (ii) any issuances of Capital
Securities of the Company if no Change in Control results therefrom, (b) become liable in respect
of any obligation (contingent or otherwise) to purchase, redeem, retire, acquire or make any other
payment in respect of any Capital Securities of any Borrower or any Subsidiary of any Borrower or
any option, warrant or other right to acquire any such Capital Securities; or (c) authorize or
issue any preferred stock or other equity securities having a mandatory redemption right in favor
of the holder thereof unless such redemption right is not so exercisable (in the absence of a
contingency) on or prior to one year after the Maturity Date.

          7.2.9. Consolidation, Merger, etc. The Borrowers will not, and will not permit any of
their Restricted Subsidiaries to, liquidate or dissolve, consolidate with, or merge into or with
(collectively, to “Merge”) any other Person, or purchase or otherwise acquire all or
substantially all of the assets of any Person, except any Borrower (other than the Company) or any
Restricted Subsidiary may Merge with and into the Company or another Borrower, and the assets or
Capital Securities of any Borrower (other than the Company) or any Restricted Subsidiary may be
purchased or otherwise acquired by any other Borrower.

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          7.2.10. Permitted Dispositions. The Borrowers will not, and will not permit any of
their Restricted Subsidiaries to, Dispose of any Properties (including Accounts, inventory and
Capital Securities) to any Person in one transaction or series of transactions unless such
Disposition is (a) a Permitted Disposition, (b) permitted by Section 7.2.9 or (c)
Dispositions of other property (real, mixed or personal, but excluding Accounts, inventory and
Capital Securities of any Borrower or any Restricted Subsidiary) having an aggregate fair market
value not to exceed $2,500,000 in the aggregate in any calendar year and so long as no Default has
occurred and is continuing.

          7.2.11. Modification of Certain Agreements. The Borrowers will not, and will not
permit any of their Restricted Subsidiaries to, consent to any amendment, supplement, waiver or
other modification of, or enter into any forbearance from exercising any rights with respect to the
terms or provisions contained in the Existing Indenture, the Existing Senior Secured Notes, the
Indenture, the Senior Secured Notes, any other Senior Secured Note Document or the terms of any
preferred stock, if any, in any manner that is adverse to the Lenders in any material respect.

          7.2.12. Transactions With Affiliates. The Borrowers will not, and will not permit any
of their Restricted Subsidiaries to, enter into or cause or permit to exist any arrangement,
transaction or contract (including for the purchase, lease or exchange of Properties or the
rendering of services) with any Affiliate of any of them (other than between Borrowers or as listed
on Item 7.2.12 of the Disclosure Schedule) unless such arrangement, transaction or contract
(a) (i) is on fair and reasonable terms no less favorable to the Borrowers or such Restricted
Subsidiary than they could obtain in an arm’s-length transaction with a Person that is not an
Affiliate and (ii) is of the kind which would be entered into by a prudent Person in the position
of the Borrowers or such Restricted Subsidiary with a Person that is not one of their Affiliates,
(b) is an Investment permitted by Section 7.2.4, (c) is a non-recourse pledge of Capital
Securities of an Unrestricted Subsidiary of the Company for the benefit of lenders of an
Unrestricted Subsidiary of the Company, (d) is an operating or similar agreement with an Affiliate
pursuant to which a Borrower or a Restricted Subsidiary operates the properties or assets of any
Affiliate in exchange for reimbursement of costs, with or without any additional consideration or
(e) is a ground lease of Non-Facility Assets for nominal or no consideration.

          7.2.13. Restrictive Agreements, etc. The Borrowers will not, and will not permit any
of their Restricted Subsidiaries to, enter into any contract, agreement or understanding
prohibiting or in any way restricting:

     (a) the granting, conveying, creation, imposition or assumption of any Lien or security
interest on or in any Properties (including revenues) of any Borrower or any Restricted
Subsidiary, whether now owned or hereafter acquired or which requires the consent of or
notice to other Persons in connection therewith; .

     (b) the ability of any Borrower or any Restricted Subsidiary of any Borrower to amend
or otherwise modify any Loan Document; or

     (c) the ability of any Restricted Subsidiary to make any sales or transfers or
payments, directly or indirectly, to the Borrowers, or the ability of the Borrowers to make

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any sales or transactions or payments, directly or indirectly, to other Borrowers,
including by way of dividends, distributions, advances, repayments of loans, reimbursements
of management and other intercompany charges, expenses and accruals or other returns on
investments.

The foregoing prohibitions shall not apply to restrictions contained (i) in any Loan Document, (ii)
in the Existing Indenture, any document granting a Lien to secure the payment of the Existing
Senior Secured Notes, the Indenture or other Senior Secured Note Documents, or (iii) in the case of
clause (a) of this Section 7.2.13, any agreement governing any Indebtedness
permitted by clause (d) of Section 7.2.2 as to the Properties permitted to be
financed with the proceeds of such Indebtedness.

          7.2.14. Sale and Leaseback. The Borrowers will not, and will not permit any of their
Restricted Subsidiaries to, directly or indirectly enter into any agreement or arrangement
providing for the sale or transfer by it of any property (now owned or hereafter acquired) to a
Person and the subsequent lease or rental of such property or other similar property from such
Person.

          7.2.15. Disposition of the Texas City Facility. Notwithstanding anything to the
contrary contained in this Agreement or any other Loan Document, the Company will not (i) permit
any other Person (including any other Borrower or any Subsidiary of any Borrower) to own or (ii)
Dispose of all or substantially all of, the Texas City Facility.

          7.2.16. Sale or Discount of Receivables. The Borrowers will not, and will not permit
any of their Restricted Subsidiaries to, sell, with or without recourse, for discount or otherwise,
any notes receivable or Accounts except for the collection of Accounts or notes receivables that
are not Eligible Accounts in the ordinary course of business consistent with past practices.

          7.2.17. Unconditional Purchase Obligations. The Borrowers will not, and will not
permit any of their Restricted Subsidiaries to, enter into or be a party to, any contract for the
purchase of materials, supplies or other property or services, if such contract requires that
payment be made by it regardless of whether or not delivery is ever made of such materials,
supplies or other property or services, other than contracts for the purchase of electricity or
natural gas.

          7.2.18. Controlled Deposit Accounts. The Borrowers will not, and will not permit any
of their Restricted Subsidiaries to, have more than $2,500,000 in cash in the aggregate (as to all
Borrowers and all Restricted Subsidiaries of the Borrowers) at any time outstanding which is not on
deposit with an Approved Depository Bank which is subject to a Control Agreement, except that the
Borrowers may deposit a portion of the proceeds of the Senior Secured Notes, in an aggregate amount
equal to that amount required to purchase or redeem all of the Existing Senior Secured Notes, in an
Escrow Account (as defined in the Indenture) with the Trustee; provided that (i) any such
Disposition of Indenture Collateral is permitted under the Loan Documents, (ii) such Net Loss
Proceeds and/or Net Proceeds are used to either repurchase the Senior Secured Notes pursuant to
Sections 4.16 and/or Section 4.17 of the Indenture (provided that such repurchase of the
Senior Secured Notes is permitted under

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Section 7.2.7) or to repair or replace such Indenture Collateral within one year from
such casualty, condemnation and/or Disposition of Indenture Collateral in accordance with Sections
4.16 and/or Section 4.17 of the Indenture, and (iii) immediately after the occurrence of both of
the events described in the preceding clause (ii), all remaining Net Loss Proceeds and/or
Net Proceeds are used to prepay the Obligations as provided in Section 3.1.2(b) or
deposited in a Controlled Deposit Account subject to a Control Agreement, as applicable.

          7.2.19. Existing Senior Secured Notes. The Company will not fail to repay in full or
repurchase all of the Existing Senior Secured Notes within 31 days after the Closing Date.

ARTICLE VIII

EVENTS OF DEFAULT

     SECTION 8.1. Listing of Events of Default. Each of the following events or
occurrences described in this Article VIII shall constitute an “Event of Default.”

          8.1.1. Non-Payment of Obligations. Any Borrower shall:

     (a) fail to pay when due any payment or prepayment of principal on any Loan or any
Reimbursement Obligation or fail to make any deposit of cash to Cash Collateralize any
Letter of Credit Outstandings when required to do so under this Agreement, including
pursuant to Section 2.6.4;

     (b) fail to pay when due any interest on any Loan or Reimbursement Obligation and such
failure shall remain unremedied for a period of three (3) days after such amount was due; or

     (c) fail to pay when due any fee described in Article III or any other monetary
Obligation, and such failure shall continue unremedied for a period of seven (7) days after
such fee or other monetary Obligation was due.

          8.1.2. Breach of Warranty. Any representation or warranty of any Borrower or any
Restricted Subsidiary of any Borrower or any of such Person’s officers made or deemed to be made in
any Loan Document (including any certificates delivered pursuant to Article V) shall have
been incorrect when made or deemed to have been made in any material respect.

          8.1.3. Non-Performance of Certain Covenants and Obligations. Any Borrower shall
default in the due performance or observance of any of its obligations under clause (d) or
(n) of Section 7.1.1, Section 7.1.4, Section 7.1.7, Section
7.1.10, or Section 7.2, or any Borrower or any Restricted Subsidiary of any Borrower
shall default in the due performance or observance of its obligations in respect of any such
clauses or Sections, as applicable, as such clauses or Sections, as applicable, are incorporated by
reference, or otherwise, in any Loan Document to which such Borrower or such Subsidiary is a party.
Any Borrower shall default in the due performance or observance of any of its obligations under
Section 3.1.3, clauses (a), (b), (c), (e) or (g) of
Section 7.1.1 or Section 7.1.9, and such default shall continue unremedied for a
period of ten (10) Business Days.

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          8.1.4. Non-Performance of Other Covenants and Obligations. Any Borrower or any
Restricted Subsidiary of any Borrower shall fail to observe or perform any of its obligations,
covenants or agreements contained in any Loan Document executed by it (other than those referred to
in Section 8.1.3), and, if capable of being remedied, such failure shall remain unremedied
for a period of 30 days after written notice thereof shall have been given to the Company by the
Administrative Agent or any Lender.

          8.1.5. Default on Other Indebtedness. (a) A default shall occur in the payment of any
amount or amounts when due (subject to any applicable grace period), of any Borrower or any
Subsidiary of any Borrower of any Indebtedness (other than Indebtedness described in Section
8.1.1), in excess of $5,000,000, whether at Stated Maturity, by acceleration, on demand or
otherwise or (b) any Borrower or any Subsidiary of any Borrower shall fail to observe or perform
any covenant or agreement contained in any agreement(s) or instrument(s) relating to Indebtedness
(other than the Obligations) of any Borrower or any Subsidiary of any Borrower in excess of
$5,000,000 within any applicable grace, notice or cure period, or any other event shall occur, if
the effect of such failure or other event is to accelerate or permit the holder of such
Indebtedness or any other Person to accelerate the maturity of such Indebtedness or to require any
of such Indebtedness to be prepaid, redeemed, purchased or defeased, or require an offer to
purchase or defease any of such foregoing Indebtedness to be made, prior to its expressed maturity,
or which such default shall continue unremedied for at least 30 days; provided,
however, that if any such default, failure or other event described in the Section
8.15 shall pertain solely to an Unrestricted Subsidiary, such default, failure or other event
shall constitute an Event of Default only if such default, failure or other event could reasonably
be expected to have a Material Adverse Effect.

          8.1.6. Judgments. Any judgment or order for the payment of money, individually or in
the aggregate, in excess of $5,000,000, exclusive of (a) any amounts covered by insurance (less any
applicable deductible) and as to which the insurer has assumed the defense or has not finally
declined coverage, and (b) any amounts covered by an indemnitor (with a long-term senior unsecured
debt rating greater than BBB and Baa2 by S&P and Moody’s) where such indemnitor has acknowledged,
in writing, in form and substance reasonably satisfactory to the Administrative Agent, that it will
indemnify such judgment or order, shall be rendered against one or more Borrowers or Subsidiaries
of Borrowers and such judgment shall not have been paid, satisfied, vacated or discharged or stayed
or bonded pending appeal within 30 days after the entry thereof or enforcement proceedings shall
have been commenced by any creditor upon such judgment or order; provided, however,
that if any such judgment or order which is not paid, satisfied, vacated or discharged or stayed or
bonded pending appeal within 30 days after the entry thereof, or for which enforcement proceedings
shall have been commenced by any creditor upon such judgment or order, pertains solely to an
Unrestricted Subsidiary, such judgment or order shall constitute an Event of Default only if such
judgment or order could reasonably be expected to have a Material Adverse Effect.

          8.1.7. Pension Plans. Any of the following events shall occur with respect to any
Pension Plan:

     (a) the institution of any steps by any Borrower, any member of its Controlled Group or
any other Person to terminate a Pension Plan other than a standard termination

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under Section 4041(b) of ERISA if, as a result of such termination, any such Borrower
or any such member could be required to make a contribution to such Pension Plan, or could
reasonably expect to incur a liability or obligation to such Pension Plan, in excess of
$1,000,000; or

     (b) a contribution failure occurs with respect to any Pension Plan sufficient to give
rise to a Lien under Section 302(f) of ERISA.

          8.1.8. Change in Control. Any Change in Control shall occur.

          8.1.9. Bankruptcy, Insolvency, etc. Any Borrower or any Subsidiary of any Borrower
shall:

     (a) become insolvent or generally fail to pay, or admit in writing its inability or
unwillingness generally to pay, debts as they become due;

     (b) apply for, consent to, or acquiesce in the appointment of a trustee, receiver,
sequestrator or other custodian for any substantial part of the property of any thereof, or
make a general assignment for the benefit of creditors;

     (c) in the absence of such application, consent or acquiescence in or permit or suffer
to exist the appointment of a trustee, receiver, sequestrator or other custodian for a
substantial part of the property of any thereof, and such trustee, receiver, sequestrator or
other custodian shall not be discharged within 60 days;

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

     (e) take any action authorizing, or in furtherance of, any of the foregoing.

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          8.1.10. Impairment of Security, etc. Any Loan Document or any Lien granted thereunder
shall (except in accordance with its terms), in whole or in part, terminate, cease to be effective
or cease to be the legally valid, binding and enforceable obligation of any Borrower or any
Subsidiary of any Borrower party thereto; any Borrower or any Subsidiary of any Borrower or any
other party shall, directly or indirectly, assert in any pleading filed in any court or contest in
any manner such effectiveness, validity, binding nature or enforceability; or, except as permitted
under any Loan Document, any Lien securing any Obligation shall, in whole or in part, cease to be a
perfected senior Lien on all Collateral senior to all other Liens, other than Permitted Liens.

     SECTION 8.2. Action if Event of Default. If any Event of Default described in
clauses (a) through (e) of Section 8.1.9 shall occur with respect to any
Borrower, the Commitments (if not theretofore terminated) shall automatically terminate and the
outstanding principal amount of all outstanding Loans and all other Obligations (including
Reimbursement Obligations) shall automatically be and become due and payable, without notice or
demand to any Person, and each Borrower shall automatically and immediately be obligated to Cash
Collateralize all Letter of Credit Outstandings. If any Event of Default (other than any Event of
Default described in clauses (a) through (e) of Section 8.1.9 with respect
to any Borrower) shall occur for any reason, whether voluntary or involuntary, and be continuing,
the Administrative Agent may, and the Administrative Agent shall upon the direction of the Required
Lenders, by notice to the Company, take one or more of the following actions, at the same or
different times:

     (a) terminate the Commitments of the Lenders;

     (b) declare all or any portion of the Loans and other Obligations (including
Reimbursement Obligations) then outstanding to be immediately due and payable, whereupon the
principal of the Loans together with accrued interest thereon and any unpaid and/or accrued
fees and any and all other Obligations, shall become immediately due and payable (and the
Borrowers shall automatically and immediately be obligated to Cash Collateralize all Letter
of Credit Outstandings), without presentment, demand, protest or any other notice of any
kind, all of which are hereby expressly waived by the Borrowers, anything contained herein
or in any other Loan Document to the contrary notwithstanding;

     (c) set-off amounts in any deposit or other accounts maintained with any Lender and
apply such amounts to the Obligations; and

     (d) exercise any and all remedies under the Loan Documents and/or under applicable law
available to the Administrative Agent and the Lenders. The enumeration of the foregoing
rights is not intended to be exhaustive and the exercise of any right shall not preclude the
exercise of any other rights, all of which shall be cumulative.

ARTICLE IX

THE ADMINISTRATIVE AGENT

     SECTION 9.1. Actions. Each Lender hereby appoints CIT as its Administrative Agent
under and for purposes of this Agreement and each other Loan Document. Each Lender

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authorizes the Administrative Agent to act on behalf of such Lender under this Agreement and
each other Loan Document and, in the absence of other written instructions from the Required
Lenders received from time to time by the Administrative Agent (with respect to which the
Administrative Agent agrees that it will comply, except as otherwise provided in this Section
9.1 or as otherwise advised by counsel), to exercise such powers hereunder and thereunder as
are specifically delegated to or required of the Administrative Agent by the terms hereof and
thereof, together with such powers as may be reasonably incidental thereto. The Administrative
Agent may execute any of its duties under this Agreement and each other Loan Document by or through
its employees, agents and attorneys-in-fact. Each Lender hereby indemnifies (which indemnity shall
survive any termination of this Agreement) the Administrative Agent, pro rata according to such
Lender’s Percentage of the Revolving Credit Commitment Amount, from and against any and all
liabilities, obligations, losses, damages, claims, costs or expenses of any kind or nature
whatsoever which may at any time be imposed on, incurred by, or asserted against, the
Administrative Agent in any way relating to or arising out of this Agreement and any other Loan
Document, including reasonable attorneys’ fees, and as to which the Administrative Agent is not
reimbursed by any Borrower (and without limiting the obligation of any Borrower to do so);
provided, however, that no Lender shall be liable for the payment of any portion of
such liabilities, obligations, losses, damages, claims, costs or expenses which are determined by a
court of competent jurisdiction in a final proceeding to have resulted from the Administrative
Agent’s gross negligence or willful misconduct. The Administrative Agent shall not be required to
take any action hereunder or under any other Loan Document, or to prosecute or defend any suit in
respect of this Agreement or any other Loan Document, unless it is indemnified hereunder to the
Administrative Agent’s satisfaction. If any indemnity in favor of the Administrative Agent shall
be or become, in the Administrative Agent’s determination, inadequate, the Administrative Agent may
call for additional indemnification from the Lenders and cease to do the acts indemnified against
hereunder until such additional indemnity is given.

     SECTION 9.2. Funding Reliance, etc. Unless the Administrative Agent shall have been
notified by telephone, confirmed in writing, by any Lender by 3:00 p.m., New York City time, on the
day prior to a Borrowing, or Disbursement with respect to a Letter of Credit pursuant to
Section 2.6.2, that such Lender will not make available the amount which would constitute
its Percentage of such Borrowing on the date specified therefor, the Administrative Agent may
assume that such Lender has made such amount available to the Administrative Agent and, in reliance
upon such assumption, make available to the applicable Borrower a corresponding amount. If and to
the extent that such Lender shall not have made such amount available to the Administrative Agent,
such Lender and such Borrower severally agree to repay the Administrative Agent forthwith on demand
such corresponding amount together with interest thereon, for each day from the date the
Administrative Agent made such amount available to such Borrower to the date such amount is repaid
to the Administrative Agent, at the interest rate applicable at the time to Credit Extensions
comprising such Borrowing.

     SECTION 9.3. Exculpation. Neither the Administrative Agent nor any of its directors,
officers, employees or agents shall be liable to any Lender for any action taken or omitted to be
taken by it under this Agreement or any other Loan Document, or in connection herewith or
therewith, except for its own willful misconduct or gross negligence, nor responsible for any
recitals or warranties herein or therein, nor for the effectiveness, enforceability, validity or
due execution of this Agreement or any other Loan Document, nor for the creation, perfection

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or priority of any Liens purported to be created by any of the Loan Documents, or the
validity, genuineness, enforceability, existence, value or sufficiency of any collateral security,
nor to make any inquiry respecting the performance by each Borrower of its obligations hereunder or
under any other Loan Document. Neither the Administrative Agent nor any of its respective
directors, officers, employees or agents shall be responsible for or have any duty to ascertain,
inquire into or verify (a) any statement, warranty or representation made in connection with any
Loan Document or any borrowing hereunder (other than a statement, warranty or representation made
by the Administrative Agent in writing), (b) the performance or observance of any of the covenants
or agreements of any Person under any Loan Document, including any agreement by any Borrower to
furnish information directly to each Lender, (c) the satisfaction of any condition specified in
Article V, except receipt of items required to be delivered solely to the Administrative
Agent, (d) the existence or possible existence of any Default or Event of Default, or (e) the
financial condition of any Borrower or any Subsidiary of any Borrower. Any such inquiry which may
be made by the Administrative Agent or any Issuer shall not obligate it to make any further inquiry
or to take any action. The Administrative Agent and each Issuer shall be entitled to rely upon
advice of counsel concerning legal matters and upon any notice, consent, certificate, statement or
writing which the Administrative Agent or any Issuer, as applicable, believe to be genuine and to
have been presented by a proper Person.

     SECTION 9.4. Successor. The Administrative Agent may resign as such at any time upon
at least 30 days’ prior notice to the Company and all Lenders. The Administrative Agent may be
removed at any time with or without cause by written notice received by the Administrative Agent
from the Required Lenders, such removal to be effective on the date specified in such notice. If
the Administrative Agent at any time shall resign or be removed, the Required Lenders may, with the
prior consent of the Company (which consent shall not be unreasonably withheld or delayed and which
shall not be required if an Event of Default has occurred and is continuing) appoint another Lender
as a successor Administrative Agent which shall thereupon become the Administrative Agent
hereunder. If no successor Administrative Agent shall have been so appointed by the Required
Lenders, and shall have accepted such appointment, within 30 days after the retiring Administrative
Agent’s giving notice of resignation or receiving notice of removal, then the retiring
Administrative Agent may, on behalf of the Lenders, with the consent of the Company, which consent
shall not be unreasonably withheld and which shall not be required if an Event of Default has
occurred and is continuing, appoint a successor Administrative Agent, which shall be one of the
Lenders or a commercial banking institution organized under the laws of the U.S. (or any State
thereof) or a U.S. branch or agency of a commercial banking institution, and having a combined
capital and surplus of at least $500,000,000. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, such successor Administrative
Agent shall be entitled to receive from the retiring Administrative Agent such documents of
transfer and assignment as the successor Administrative Agent may reasonably request, and shall
thereupon succeed to and become vested with all rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its
duties and obligations under this Agreement. After any retiring Administrative Agent’s resignation
or removal hereunder as such, the provisions of (a) this Article IX shall inure to its benefit as
to any actions taken or omitted to be taken by it while it was the Administrative Agent under this
Agreement, and (b) Section 10.3 and Section 10.4 shall continue to inure to its
benefit. Notwithstanding anything else to the contrary in this Section 9.4, the
Administrative Agent may at any time, without the

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consent of the Company, any Borrower or any Subsidiary of any Borrower or any Lender, appoint
an Affiliate which is a commercial banking institution as a successor Administrative Agent.

     SECTION 9.5. Credit Extensions by Administrative Agent and Issuer. The Administrative
Agent and any Issuer shall have the same rights and powers with respect to (a) in the case of the
Administrative Agent, the Credit Extensions made by it or any of its Affiliates and (b) in the case
of any Issuer, the Letters of Credit issued by it or any of its Affiliates, as any other Lender and
may exercise the same as if it were not the Administrative Agent or an Issuer. The Administrative
Agent, each Issuer and each of their respective Affiliates may accept deposits from, lend money to,
and generally engage in any kind of business with the Company or any Subsidiary or Affiliate of the
Company as if the Administrative Agent or Issuer were not the Administrative Agent or Issuer
hereunder.

     SECTION 9.6. Credit Decisions. Each Lender acknowledges that it has, independently of
the Administrative Agent, any Issuer and each other Lender, and based on such Lender’s review of
the financial information of each Borrower, this Agreement, the other Loan Documents (the terms and
provisions of which being satisfactory to such Lender) and such other documents, information and
investigations as such Lender has deemed appropriate, made its own credit decision to extend its
Commitments. Each Lender also acknowledges that it will, independently of the Administrative
Agent, any Issuer and each other Lender, and based on such other documents, information and
investigations as it shall deem appropriate at any time, continue to make its own credit decisions
as to exercising or not exercising from time to time any rights and privileges available to it
under the Loan Documents.

     SECTION 9.7. Copies, etc. The Administrative Agent shall give prompt notice to each
Lender of each material notice or material request required or permitted to be given to the
Administrative Agent by the Borrowers pursuant to the terms of the Loan Documents (unless
concurrently delivered to the Lenders by the Borrowers). The Administrative Agent will distribute
to each Lender each document or instrument received for its account and copies of all other
communications received by the Administrative Agent from the Borrowers for distribution to the
Lenders by the Administrative Agent in accordance with the terms of the Loan Documents. The
Administrative Agent shall have no duty to disclose to the Lenders information that is not required
to be furnished by the Borrowers to the Administrative Agent, but that may be voluntarily furnished
by the Borrowers to the Administrative Agent (either in their capacity as Administrative Agent or
in its individual capacity).

     SECTION 9.8. Reliance by Administrative Agent. The Administrative Agent shall be
entitled to rely upon any certification, notice or other communication (including any thereof by
telephone or telecopy) believed by it to be genuine and correct and to have been signed or sent by
or on behalf of the proper Person, and upon advice and statements of legal counsel, independent
accountants and other experts selected by the Administrative Agent. As to any matters not
expressly provided for by the Loan Documents, the Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, hereunder or thereunder in accordance with
instructions given by the Required Lenders or all of the Lenders as is required in such
circumstance, and such instructions of such Lenders and any action taken or failure to act pursuant
thereto shall be binding on all Secured Parties. For purposes of applying amounts in

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accordance with this Section 9.8, the Administrative Agent shall be entitled to rely
upon any Secured Party that has entered into a Hedging Agreement with any Borrower or any
Subsidiary of any Borrower for a determination (which such Secured Party agrees to provide or cause
to be provided upon request of the Administrative Agent) of the outstanding Obligations owed to
such Secured Party under any Hedging Agreement. Unless it has actual knowledge evidenced by way of
written notice from any such Secured Party and any Borrower to the contrary, the Administrative
Agent, in acting in such capacity under the Loan Documents, shall be entitled to assume that no
Hedging Agreements or Obligations in respect thereof are in existence or outstanding between any
Secured Party and any Borrower or any Subsidiary of any Borrower.

     SECTION 9.9. Defaults. The Administrative Agent shall not be deemed to have knowledge
or notice of the occurrence of a Default unless the Administrative Agent has received a written
notice from a Lender or a Borrower specifying such Default and stating that such notice is a
“Notice of Default”. In the event that the Administrative Agent receives such a notice of the
occurrence of a Default, the Administrative Agent shall give prompt notice thereof to the Lenders.
The Administrative Agent shall (subject to Section 10.1) take such action with respect to
such Default as shall be directed by the Required Lenders; provided, that unless and until
the Administrative Agent shall have received such directions, the Administrative Agent may (but
shall not be obligated to) take such action, or refrain from taking such action, with respect to
such Default as it shall deem advisable in the best interest of the Lenders except to the extent
that this Agreement expressly requires that such action be taken, or not be taken, only with the
consent or upon the authorization of the Required Lenders or all Lenders.

ARTICLE X

MISCELLANEOUS PROVISIONS

     SECTION 10.1. Waivers; Amendments, etc. The provisions of this Agreement and of each
other Loan Document may from time to time be amended, modified or waived, if such amendment,
modification or waiver is in writing and consented to in writing by each Borrower party thereto and
the Required Lenders; provided, however, that no such amendment, modification or
waiver shall be effective which would:

     (a) modify any requirement hereunder that any particular action be taken by all the
Lenders or by the Required Lenders unless consented to in writing by each Lender;

     (b) (i) modify this Section 10.1, or clause (a) of Section
10.10, (ii) change the definition of “Required Lenders”, (iii) reduce any fees
described in Article III, (iv) release all or substantially all of the Collateral
(except in each case as otherwise specifically provided in this Agreement, the Intercreditor
Agreement, a Pledge Agreement or a Security Agreement) without the written consent of each
Lender adversely affected thereby, (v) amend, modify or waive the provisions of Section
3.1.1 or Section 3.1.2 or clause (b) of Section 2.2.2 or (vi)
extend the Commitment Termination Date, in each case, without the written consent of each
Lender adversely affected thereby;

     (c) permit outstanding Credit Extensions to exceed the Maximum Loan Amount or increase
the Revolving Credit Commitment Amount without the consent of

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each Lender or increase the Revolving Credit Commitment of any Lender without the
written consent of such Lender;

     (d) (i) extend the final Maturity Date, (ii) reduce the principal amount of or rate of
interest on any Loan or reduce any fee payable to any Lender or (iii) extend the date on
which any principal payment, interest or fees are payable on any Loans, in each case without
the written consent of each Lender (it being understood and agreed, however, that any vote
to rescind any acceleration made pursuant to Section 8.2 of amounts owing with
respect to the Loans and other Obligations shall only require the vote of the Required
Lenders);

     (e) increase the Stated Amount of any Letter of Credit unless consented to by the
Issuer of such Letter of Credit;

     (f) affect adversely the interests, rights or obligations of the Administrative Agent,
any Issuer or, the Swing Line Lender (in its capacity as the Administrative Agent, Issuer or
the Swing Line Lender), unless consented to in writing by the Administrative Agent, any
Issuer or the Swing Line Lender, as the case may be;

     (g) change the definition of “Borrowing Base Amount,” “Eligible
Account,” “Eligible Inventory,” “Excess Availability,” or “Maximum
Loan Amount” or any of the definitions used within those definitions in each case if the
effect of such change would be to require a Lender to make or participate in a Credit
Extension in an amount that is greater than such Lender would have had to make or
participate in immediately prior to such amendment, modification or waiver without the
written consent of each Lender; provided, however, nothing contained in this
clause shall limit the Administrative Agent’s ability to adjust the Borrowing Base Amount,
the amount of Eligible Accounts or Eligible Inventory, the Excess Availability, the Maximum
Loan Amount or any of the definitions used within such definitions, in each case to the
extent otherwise permitted by this Agreement;

     (h) have the effect (either immediately or at some later time) of enabling the
Borrowers to satisfy a condition precedent set forth in Section 5.2 to the making of
a Loan or the issuance of a Letter of Credit without the written consent of the Required
Lenders; or

     (i) amend the Security Documents without the consent of the Required Lenders or the
Intercreditor Agreement without the consent of the Required Lenders.

Notwithstanding anything to the contrary contained in this Section 10.1, the Administrative
Agent may, without the consent of any Lender, execute amendments or modifications of any Loan
Document to cure any ambiguity, omission, defect or inconsistency therein. No failure or delay on
the part of the Administrative Agent, any Issuer or any Lender in exercising any power or right
under this Agreement or any other Loan Document shall operate as a waiver thereof, nor shall any
single or partial exercise of any such power or right preclude any other or further exercise
thereof or the exercise of any other power or right. No notice to or demand on any Borrower or any
Subsidiary of any Borrower in any case shall entitle it to any notice or demand

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in similar or other circumstances. No waiver or approval by the Administrative Agent, any Issuer
or any Lender under this Agreement or any other Loan Document shall, except as may be otherwise
stated in such waiver or approval, be applicable to subsequent transactions. No waiver or approval
hereunder shall require any similar or dissimilar waiver or approval thereafter to be granted
hereunder.

     For purposes of this Section 10.1, the Administrative Agent shall have primary
responsibility, together with the Company, in the negotiation, preparation and documentation
relating to any amendment, modification or waiver of this Agreement, any other Loan Document or any
other agreement or document related hereto or thereto contemplated pursuant to this Section
10.1.

     SECTION 10.2. Notices; Time. All notices, requests and other communications provided
to any party hereto under this Agreement or any other Loan Document shall be in writing and
addressed, delivered or transmitted to such party at its address, facsimile number or E-Mail
address set forth on Schedule II hereto or, in the case of a Lender which becomes a party
hereto after the date hereof, as set forth in the Lender Assignment Agreement pursuant to which
such Lender becomes a Lender hereunder or at such other address, facsimile number or E-Mail address
as may be designated by such party in a notice to the other parties. Any notice (a) if mailed and
properly addressed with postage prepaid or if properly addressed and sent by pre-paid courier
service, shall be deemed given when it has been received or (b) if transmitted by facsimile or
other electronic transmission, shall be deemed given when transmitted (and telephonic or electronic
confirmation of receipt thereof has been received, provided that if such confirmation is
electronic, it was generated by an affirmative action by or on behalf of the recipient of such
notice, as opposed to an automated E-Mail response). Unless otherwise indicated, all references to
the time of a day in a Loan Document shall refer to New York City time.

     SECTION 10.3. Payment of Costs and Expenses. Each Borrower, jointly and severally,
agrees to pay on demand all reasonable out-of-pocket expenses of the Administrative Agent
(including the reasonable fees and out-of-pocket expenses of Baker Botts, L.L.P., counsel to the
Administrative Agent and of local or foreign counsel, if any, who may be retained by counsel to the
Administrative Agent) in connection with:

     (a) the syndication of the Loans, the negotiation, preparation, execution, and delivery
of this Agreement and of each other Loan Document, including schedules, opinions and
exhibits, and any amendments, waivers, consents, supplements or other modifications to this
Agreement or any other Loan Document as may from time to time hereafter be required, whether
or not the transactions contemplated hereby are consummated and the consummation and
administration of the transactions contemplated hereby and thereby;

     (b) the filing, recording or refiling or rerecording of any Loan Document and/or any
U.C.C. financing statements relating thereto and all amendments, supplements and
modifications to any thereof and any and all other documents or instruments of further
assurance required to be filed or recorded or refiled or rerecorded by the terms of any Loan
Document;

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     (c) the preparation and review of the form of any document or instrument relevant to
this Agreement or any other Loan Document;

     (d) the enforcement or preservation of any rights under this Agreement, any Loan
Document, or any other document related thereto; and

     (e) all Indemnified Liabilities.

     Each Borrower further jointly and severally agrees to pay, and to save the Administrative Agent and
the Lenders harmless from all liability for, any stamp or other similar Taxes which may be payable
in connection with the execution or delivery of this Agreement, the Borrowings hereunder, the
issuance of the Notes, the issuance of the Letters of Credit or any other Loan Documents. Each
Borrower also agrees to jointly and severally reimburse the Administrative Agent and each Lender
upon demand for all reasonable out-of-pocket expenses (including attorneys’ fees and legal
expenses) incurred by the Administrative Agent or such Lender in connection with (i) the
negotiation of any restructuring or “work out”, whether or not consummated, of any Obligations and
(ii) the enforcement of any Obligations. In addition, the Borrowers jointly and severally also
agree, subject to the terms of this Agreement, to reimburse the Administrative Agent on demand for
all reasonable third party administration, audit and monitoring expenses incurred in connection
with determinations in respect of Eligible Accounts, Eligible Inventory and/or any other matters
concerning the Borrowing Base Amount, provided that, unless a Default or Event of Default
has occurred and is continuing, the Borrowers shall be obligated to reimburse the Administrative
Agent for no more than one third-party Collateral audit per twelve-month period. The payments to
be made under clause (a) of this Section 10.3 shall be made on the Closing Date and
all other payments under this Section 10.3 shall be made on demand.

     SECTION 10.4. Indemnification. In consideration of the execution and delivery of this
Agreement by each Lender and the extension of the Commitments, each Borrower jointly and severally
indemnifies, exonerates and holds the Administrative Agent, the Documentation Agent, each Issuer
and each Lender and each of their respective partners, trustees, officers, directors, attorneys,
employees and agents (collectively, the “Indemnified Parties”) free and harmless from and
against any and all actions, causes of action, suits, losses, costs, liabilities and damages, and
expenses incurred in connection therewith (irrespective of whether any such Indemnified Party is a
party to the action for which indemnification hereunder is sought), including reasonable attorneys’
fees and disbursements, whether incurred in connection with actions between or among the parties
hereto or the parties hereto and third parties (collectively, the “Indemnified
Liabilities”), incurred by the Indemnified Parties or any of them as a result of, or arising
out of, or relating to:

     (a) any transaction financed or to be financed in whole or in part, directly or
indirectly, with the proceeds of any Credit Extension, including all Indemnified Liabilities
arising in connection with the Existing Credit Agreement, and all documents related thereto;

     (b) the entering into and performance of this Agreement and any other Loan Document by
any of the Indemnified Parties (including any action brought by or on

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behalf of any Borrower as the result of any determination by the Required Lenders
pursuant to Article V not to make any Credit Extension hereunder but excluding any
such action in which a court of competent jurisdiction in a final non-appealable judgment
determined that such Lenders breached their obligations hereunder in respect of such Credit
Extension);

     (c) any investigation, litigation or proceeding related to any acquisition or proposed
acquisition by any Borrower or any Subsidiary thereof of all or any portion of the Capital
Securities or assets of any Person, whether or not an Indemnified Party is party thereto;

     (d) any investigation, litigation or proceeding related to any environmental cleanup,
audit, compliance or other matter relating to the protection of the environment or the
Release by any Borrower or any Subsidiary thereof of any Hazardous Material;

     (e) the presence on or under, or the escape, seepage, leakage, spillage, discharge,
emission, discharging or releases from, any real property owned or operated by any Borrower
or any Subsidiary thereof of any Hazardous Material (including any losses, liabilities,
damages, injuries, costs, expenses or claims asserted or arising under any Environmental
Law), regardless of whether caused by, or within the control of, such Borrower or
Subsidiary; or

     (f) each Lender’s Environmental Liability (the indemnification herein shall survive
repayment of the Obligations and any transfer of the property of any Borrower or its
Subsidiaries by foreclosure or by a deed in lieu of foreclosure for any Lender’s
Environmental Liability, regardless of whether caused by, or within the control of, such
Borrower or such Subsidiary);

in each case, except for any such Indemnified Liabilities arising for the account of a
particular Indemnified Party by reason of the relevant Indemnified Party’s gross negligence
or willful misconduct. Each Borrower and its permitted successors and assigns hereby waive,
release and agree not to make any claim, or bring any cost recovery action against, any
Indemnified Party under CERCLA or any state equivalent, or any similar law now existing or
hereafter enacted. It is expressly understood and agreed that to the extent that any
Indemnified Party is strictly liable under any Environmental Laws, such Borrower’s
obligation to such Indemnified Party under this indemnity shall likewise be without regard
to fault on the part of such Borrower, to the extent permitted under applicable law, with
respect to the violation or condition which results in liability of an Indemnified Party.
If and to the extent that the foregoing undertaking may be unenforceable for any reason,
such Borrower hereby agrees to make the maximum contribution to the payment and satisfaction
of each of the Indemnified Liabilities which is permissible under applicable law.

     SECTION 10.5. Survival. The obligations of each Borrower under Sections 4.3,
4.4, 4.5, 4.6, 10.3 and 10.4 and the obligations of the
Lenders under Section 9.1, shall in each case survive any termination of this Agreement
(including in the event of any release of any Borrower pursuant to the terms of this Agreement),
the payment in full in cash of all Obligations, the

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termination of all Commitments and any assignment from one Lender to another (in the case of
Sections 10.3 and 10.4) and the occurrence of the Termination Date. The
representations and warranties made by each Borrower in this Agreement and in each other Loan
Document shall survive the execution and delivery of this Agreement and each such other Loan
Document.

     SECTION 10.6. Severability. Any provision of this Agreement or any other Loan
Document which is prohibited or unenforceable in any jurisdiction shall, as to such provision and
such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Agreement or such Loan Document or affecting the
validity or enforceability of such provision in any other jurisdiction.

     SECTION 10.7. Headings. The various headings of this Agreement and of each other Loan
Document are inserted for convenience only and shall not affect the meaning or interpretation of
this Agreement or such other Loan Document or any provisions hereof or thereof.

     SECTION 10.8. Execution in Counterparts; Effectiveness, etc. This Agreement may be
executed by the parties hereto in several counterparts, each of which shall be deemed to be an
original (whether such counterpart is originally executed or an electronic copy of an original and
each party hereto other than the Administrative Agent and the Company expressly waives its rights
to receive originally executed documents other than with respect to any Notes) and all of which
shall constitute together but one and the same agreement. This Agreement shall become effective as
of the Closing Date.

     SECTION 10.9. Governing Law; Entire Agreement. THIS AGREEMENT AND EACH OTHER LOAN
DOCUMENT SHALL EACH BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE LAWS OF THE STATE OF
NEW YORK. EACH LETTER OF CREDIT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OR RULES DESIGNATED IN SUCH LETTER OF CREDIT, OR IF NO LAWS OR RULES ARE DESIGNATED, THE
INTERNATIONAL STANDBY PRACTICES (ISP98—INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NUMBER 590
(THE “ISP98 RULES”)) AND, AS TO MATTERS NOT GOVERNED BY THE ISP98 RULES, THE LAWS OF THE
STATE OF NEW YORK. This Agreement and the other Loan Documents constitute the entire understanding
among the parties hereto with respect to the subject matter hereof and thereof and supersede any
prior agreements, written or oral, with respect thereto.

     SECTION 10.10. Successors and Assigns. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and assigns;
provided, however, that:

     (a) no Borrower may assign or transfer its rights or obligations hereunder without the
prior written consent of the Administrative Agent and all Lenders other than pursuant to
Section 7.2.9; and

     (b) the rights of sale, assignment and transfer of the Lenders are subject to
Section 10.11.

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     SECTION 10.11. Sale and Transfer of Loans; Participations in Loans and Notes. Each
Lender may assign, or sell participations in, its Loans and Commitments to one or more other
Persons in accordance with this Section 10.11.

          10.11.1. Assignments. Any Lender (an “Assignor Lender”) may, with notice to
the Administrative Agent and the Company, and with the written consent (whether by originally
executed counterpart or electronic copy thereof) of the Company (provided that such consent
of the Company shall not be (x) unreasonably withheld or delayed, (y) required in the case of
assignments made to an Affiliate of either a Lender or the Administrative Agent, or (z) required at
any time when an Event of Default shall have occurred and be continuing), assign and delegate to
any commercial bank, fund which is regularly engaged in making, purchasing or investing in loans or
securities or any other financial institution or commercial finance company (an “Eligible
Assignee”), all or any fraction of such Lender’s total Loans, participations in each Letter of
Credit and Letter of Credit Outstandings with respect thereto and Commitments (each such Eligible
Assignee to whom such assignment and delegation is to be made, being hereinafter referred to as an
“Assignee Lender”) in a minimum aggregate amount equal to the lesser of (i) $5,000,000 or
(ii) the then remaining amount of such Lender’s Loans and Commitments; provided,
however, that any such Assignee Lender will comply, if applicable, with the provisions
contained in Section 4.6 and each Borrower and the Administrative Agent shall be entitled
to continue to deal solely and directly with such Lender in connection with the interests so
assigned and delegated to an Assignee Lender until (A) written notice of such assignment and
delegation, together with payment instructions, addresses and related information with respect to
such Assignee Lender, shall have been given to each Borrower and the Administrative Agent by such
Lender and such Assignee Lender, (B) the Assignor Lender and such Assignee Lender shall have
executed and delivered to each Borrower and the Administrative Agent a Lender Assignment Agreement,
accepted by the Administrative Agent, and (C) the processing fees described below shall have been
paid, if required. From and after the “Settlement Date” (as that term is defined in each Lender
Assignment Agreement), (i) the Assignee Lender thereunder shall be deemed automatically to have
become a party hereto and to the extent that rights and obligations hereunder have been assigned
and delegated to such Assignee Lender in connection with such Lender Assignment Agreement, shall
have the rights and obligations of a Lender hereunder and under the other Loan Documents, and (ii)
the Assignor Lender, to the extent that rights and obligations hereunder have been assigned and
delegated by it in connection with such Lender Assignment Agreement, shall be released from its
obligations hereunder and under the other Loan Documents. Within ten Business Days after its
receipt of notice that the Administrative Agent has received an executed Lender Assignment
Agreement, if the Assignor Lender or Assignee Lender so requests, the Borrowers shall execute and
deliver to the Administrative Agent (for delivery to the relevant Assignee Lender), new Notes
evidencing such Assignee Lender’s assigned Loans and Commitments and, if the Assignor Lender has
retained Loans and Commitments hereunder, replacement Notes in the principal amount of the Loans
and Commitments retained by the Assignor Lender hereunder (such Notes to be in exchange for, but
not in payment of, those Notes then held by such Assignor Lender). Each such Note shall be dated
the date of the predecessor Notes. Accrued interest and accrued fees on the Credit Extensions
prior to assignment shall be paid to the Assignor Lender and following assignment shall be paid to
the Assignee Lender at the same time or times provided in this Agreement. Such Assignor Lender or
such Assignee Lender must also pay a processing fee to the Administrative Agent upon delivery of
any Lender Assignment Agreement in the amount of $3,500, unless such

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assignment and delegation is by a Lender to its Affiliate, or if such assignment and
delegation is by a Lender to a Federal Reserve Bank (or, if such Lender is an investment fund, to
the trustee under the indenture to which such fund is a party in support of its obligations to such
trustee), as provided below. Any attempted assignment and delegation not made in accordance with
this Section 10.11.1 shall be null and void. Nothing contained in this Section
10.11.1 shall prevent or prohibit any Lender from pledging its rights (but not its obligations
to make Loans or participate in Letters of Credit or Letter of Credit Outstandings) under this
Agreement and/or its Loans hereunder (i) to a Federal Reserve Bank in support of borrowings made by
such Lender from such Federal Reserve Bank or (ii) in the case of a Lender that is an investment
fund, to the trustee under the indenture to which such fund is a party in support of its
obligations to such trustee; provided, that any such assignment to a trustee shall be
subject to the provisions of this Section 10.11.1. In the event that S&P, Moody’s or
Thompson’s BankWatch (or InsuranceWatch Ratings Service, in the case of Lenders that are insurance
companies (or Best’s Insurance Reports, if such insurance company is not rated by Insurance Watch
Ratings Service)) shall, after the date that any Lender with a Commitment to make Revolving Loans
or participate in Letters of Credit becomes a Lender, downgrade the long-term certificate of
deposit rating or long-term senior unsecured debt rating of such Lender, and the resulting rating
shall be below BBB-, Baa3 or C (or BB, in the case of Lender that is an insurance company (or B, in
the case of an insurance company not rated by InsuranceWatch Ratings Service)) respectively, then
the Borrowers (with the consent of the Administrative Agent, such consent not to be unreasonably
withheld or delayed) shall have the right, but not the obligation, upon notice to such Lender and
the Administrative Agent, to replace such Lender with an Assignee Lender in accordance with and
subject to the restrictions contained in this Section 10.11.1, and such Lender hereby
agrees to transfer and assign without recourse (in accordance with and subject to the restrictions
contained in this Section 10.11.1) all its interests, rights and obligations in respect of
its Revolving Loan Commitment under this Agreement to such Assignee Lender; provided,
however, that (i) no such assignment shall conflict with any law, rule and regulation or
order of any Governmental Authority and (ii) such Assignee Lender shall pay to such Lender in
immediately available funds on the date of such assignment the principal of and interest and fees
(if any) accrued to the date of payment on the Loans made, and Letters of Credit participated in,
by such Lender hereunder and all other amounts accrued for such Lender’s account or owed to it
hereunder.

          10.11.2. Participations. Any Lender may at any time sell to one or more commercial
banks or other Persons (each such commercial bank and other Person being herein called a
“Participant”) participating interests in any of the Loans, Commitments, participations in
each Letter of Credit and Letters of Credit Outstandings or other interests of such Lender
hereunder; provided, however, that

     (a) no participation contemplated in this Section 10.11.2 shall relieve such
Lender from its Commitments or its other obligations hereunder or under any other Loan
Document;

     (b) such Lender shall remain solely responsible for the performance of its Commitments
and such other obligations and such Participant shall not become a Lender
hereunder unless such Lender and such Participant comply with the provisions set forth
in this Section 10.11.2;

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     (c) each Borrower and the Administrative Agent shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and obligations under this
Agreement and each of the other Loan Documents;

     (d) no Participant, unless such Participant is an Affiliate of such Lender, or is
itself a Lender, shall be entitled to require such Lender to take or refrain from taking any
action hereunder or under any other Loan Document, except that such Lender may agree with
any Participant that such Lender will not, without such Participant’s consent, agree to any
reduction in the interest rate or amount of fees that such Participant is otherwise entitled
to, a decrease in the principal amount, or an extension of the Maturity Date, of any Loan in
which such Participant has purchased a participating interest or a release of all or
substantially all of the Collateral under the Loan Documents or any Borrower, in each case
except as otherwise specifically provided in a Loan Document; and

     (e) the Borrowers shall not be required to pay any amount under Sections 4.3,
4.4, 4.5, 4.6, 10.3 and 10.4 that is greater than
the amount which it would have been required to pay had no participating interest been sold.

Each Borrower acknowledges and agrees, subject to clause (a) of this Section
10.11.2, that, to the fullest extent permitted under applicable law, each Participant, for
purposes of Sections 4.3, 4.4, 4.5, 4.6, 4.8, 4.9,
10.3 and 10.4, shall be considered a Lender.

     SECTION 10.12. Confidentiality. The Lenders shall hold all non-public information
obtained pursuant to the requirements of this Agreement in accordance with their customary
procedures for handling confidential information of this nature and in accordance with safe and
sound banking practices and in any event may make disclosure to any of their examiners, Affiliates,
outside auditors, counsel and other professional advisors in connection with this Agreement or as
reasonably required by any bona fide transferee, participant or assignee or as required or
requested by any governmental agency or representative thereof or pursuant to legal process;
provided, however, that

     (a) unless specifically prohibited by applicable law or court order, each Lender shall
notify the Company of any request by any governmental agency or representative thereof
(other than any such request in connection with an examination of the financial condition of
such Lender by such governmental agency) for disclosure of any such nonpublic information
prior to disclosure of such information;

     (b) prior to any such disclosure pursuant to this Section 10.12, each Lender
shall require any such bona fide transferee, participant and assignee receiving a disclosure
of non-public information to agree (i) to be bound by this Section 10.12, and (ii)
to require such Person to require any other Person to whom such Person discloses such
non-public information to be similarly bound by this Section 10.12; and

     (c) except as may be required by an order of a court of competent jurisdiction and to
the extent set forth therein, no Lender shall be obligated or required to return any
materials furnished by any Borrower or any Subsidiary.

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     SECTION 10.13. Other Transactions. Nothing contained herein shall preclude the
Secured Parties from engaging in any transaction, in addition to those contemplated by this
Agreement or any other Loan Document, with any Borrower or any of its Affiliates in which such
Borrower or such Affiliate is not restricted hereby from engaging with any other Person.

     SECTION 10.14. Forum Selection and Consent to Jurisdiction. EACH PARTY TO THIS
AGREEMENT HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, OR FOR
RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF, TO THE NON-EXCLUSIVE GENERAL
JURISDICTION OF ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION SITTING IN NEW YORK COUNTY,
NEW YORK. ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE AGENT, EACH ISSUER, THE LENDERS OR THE
BORROWERS THAT IS BROUGHT IN THE STATE OF NEW YORK SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN
THE COURTS OF THE STATE OF NEW YORK LOCATED IN NEW YORK COUNTY OF THE STATE OF NEW YORK OR IN THE
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED,
HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE
BROUGHT, AT THE ADMINISTRATIVE AGENT’S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. THE BORROWERS HEREBY EXPRESSLY AND IRREVOCABLY SUBMIT
TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND OF THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET
FORTH ABOVE. THE BORROWERS FURTHER IRREVOCABLY CONSENT TO THE SERVICE OF PROCESS BY REGISTERED
MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK AND EXPRESSLY
AND IRREVOCABLY APPOINTS CT CORPORATION SYSTEM AS ITS DOMICILE AND ADDRESS FOR SERVICE OF PROCESS
FOR PURPOSES OF ANY ACTION AS TO WHICH IT HAS SUBMITTED TO JURISDICTION AS SET FORTH IN THIS
AGREEMENT, AND AGREES THAT SERVICE UPON SUCH AUTHORIZED AGENT SHALL BE DEEMED IN EVERY RESPECT
SERVICE OF PROCESS UPON ANY BORROWER OR ITS SUCCESSORS AND ASSIGNS, AND, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, SHALL BE TAKEN AND HELD TO BE VALID PERSONAL SERVICE UPON IT. EACH BORROWER HEREBY
EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT
MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION
HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING IN THIS AGREEMENT SHALL AFFECT THE RIGHT OF ANY
AGENT, ANY LENDER OR THE ISSUER TO SERVE LEGAL

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PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT THE RIGHT OF ANY SUCH PERSON TO BRING ANY ACTION OR PROCEEDING AGAINST SUCH BORROWER OR ITS
PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION. TO THE EXTENT THAT ANY BORROWER HAS OR HEREAFTER
MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH
SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH
RESPECT TO ITSELF OR ITS PROPERTY, EACH BORROWER HEREBY, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS.

     SECTION 10.15. Waiver of Jury Trial. THE ADMINISTRATIVE AGENT, THE LENDERS, EACH
ISSUER AND THE BORROWERS HEREBY, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT,
COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE AGENT, THE
LENDERS, EACH ISSUER OR THE BORROWERS RELATED THERETO. EACH BORROWER ACKNOWLEDGES AND AGREES THAT
IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF
EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT
FOR THE ADMINISTRATIVE AGENT, THE LENDERS AND EACH ISSUER ENTERING INTO THIS AGREEMENT AND EACH
SUCH OTHER LOAN DOCUMENT.

     SECTION 10.16. Certain Collateral Matters. The Administrative Agent is authorized on
behalf of all the Lenders, without the necessity of any notice to or further consent from the
Lenders, from time to time to take any action with respect to any Collateral or the Loan Documents
which may be necessary to perfect and maintain perfected the security interest in and Liens upon
the Collateral granted pursuant to the Loan Documents. The Lenders irrevocably authorize the
Administrative Agent, upon the request and at the reasonable expense of the Company, to release or
modify (and to execute and deliver such documents or instruments as the Company may reasonably
request to evidence or effect the release or modification of) any security interest or Lien granted
to or held by the Administrative Agent (a) on any Collateral subject to the Security Documents on
the Termination Date; (b) on any property Disposed of as part or in connection with any Permitted
Disposition; (c) on any property in which the Borrowers owned no interest at the time the security
interest and/or Lien was granted or at any time thereafter owns no interest; (d) on property leased to the Borrowers under a lease which has
expired or been terminated in a transaction permitted under this Agreement or is about to expire
and which has not been, and is not intended by the Borrowers to be, renewed or extended; (e) on an
instrument evidencing Indebtedness or other debt instrument, if the Indebtedness evidenced

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thereby has been paid in full; (f) if approved, authorized or ratified in writing by the applicable
Required Lenders or each Lender required by Section 10.1; or (g) as specified in
Section 7.1.12(c). The Lenders hereby confirm the Administrative Agent’s authority to
release or modify particular types or items of collateral pursuant to this Section 10.16.
Additionally, the Lenders hereby irrevocably authorize the Administrative Agent to enter into the
Intercreditor Agreement and each of the Lenders agree to be bound by all of the terms and
conditions contained therein.

     SECTION 10.17. Interest. It is the intention of the parties hereto to conform
strictly to usury laws applicable to the Administrative Agent, any Issuer and the Lenders
(collectively, the “Financing Parties”). Accordingly, if any amounts payable under the
Loan Documents would be usurious as to any Financing Party under laws applicable to it, then,
notwithstanding anything to the contrary in the Notes, this Agreement or in any other Loan Document
or other agreement entered into in connection with this Agreement or as security for the
Obligations, it is agreed as follows: (a) the aggregate of all consideration which constitutes
interest under law applicable to any Financing Party that is contracted for, taken, reserved,
charged or received by such Financing Party under this Agreement or under any of such other Loan
Document or agreements or otherwise in connection with the Obligations shall under no circumstances
exceed the maximum amount allowed by such applicable law, (b) in the event that the maturity of the
Obligations is accelerated for any reason, or in the event of any required or permitted prepayment,
then such consideration that constitutes interest under law applicable to any Financing Party may
never include more than the maximum amount allowed by such applicable law, and (c) excess interest,
if any, provided for in this Agreement or otherwise in connection with the Obligations shall be
canceled automatically by such Financing Party and, if theretofore paid, shall be credited by such
Financing Party on the principal amount of the Obligations to such Financing Party (or, to the
extent that the principal amount of the Obligations to such Financing Party shall have been or
would thereby be paid in full, refunded by such Financing Party to the Borrowers). The right to
accelerate the maturity of the Obligations does not include the right to accelerate any interest
which has not otherwise accrued on the date of such acceleration. All sums paid or agreed to be
paid to the Financing Parties for the use, forbearance or detention of sums included in the
Obligations shall, to the extent permitted by law applicable to such Financing Party, be amortized,
prorated, allocated and spread throughout the full term of the Obligations until payment in full so
that the rate or amount of interest on account of the Obligations does not exceed the applicable
usury ceiling, if any. As used in this Section 10.17, the terms “applicable law” or “laws
applicable to any Financing Party” shall mean the law of any jurisdiction whose laws may be
mandatorily applicable notwithstanding other provisions of this Agreement, or law of the United
States applicable to any Financing Party and the Obligations which would permit such Financing
Party to contract for, charge, take, reserve or receive a greater amount of interest than under
such jurisdiction’s law.

     SECTION 10.18. Assignment of Existing Loans. Those Lenders who are parties to the
Existing Credit Agreement (each, an “Existing Credit Agreement Lender”) hereby assign, to
the Lenders who are parties hereto, the Indebtedness owed to them under the Existing Credit
Agreement, in proportion to each Lender’s Aggregate Pro Rata Share (as defined in this
Section 10.18). “Aggregate Pro Rata Share” means, for any Lender, the percentage
(carried out to the ninth decimal place) that (a) its Revolving Credit Commitment with respect to
the Revolving Credit Loans plus its Swing Line Loan Commitment with respect to the Swing
Line Loans bears

114

 

to (b) the Revolving Credit Commitment Amount plus the Swing Line Loan
Commitment Amount. On the Closing Date, the Lenders shall make cash settlement either directly or
through the Administrative Agent, as the Administrative Agent may direct or approve, with respect
to all assignments and reallocations as reflected in this Section 10.18. The Borrowers
agree to pay any loss, cost or expense incurred by the Lenders who are parties to the Existing
Credit Agreement as a result of payments received pursuant to the reallocations and assignments
herein referenced, in accordance with Section 4.4 hereof.

     SECTION 10.19. Restatement of Existing Credit Agreement. The parties hereto agree
that, on the Closing Date: (a) the Obligations represent, among other things, the restatement,
renewal, amendment, extension, and modification of the “Obligations” as defined in the Existing
Credit Agreement; (b) this Agreement is intended to, and does hereby, restate, renew, extend,
amend, modify, supersede, and replace the Existing Credit Agreement in its entirety; (c) the
promissory notes, if any, executed pursuant to this Agreement amend, renew, extend, modify,
replace, restate, substitute for, and supersede in their entirety (but do not extinguish the
Indebtedness arising under) the promissory notes issued pursuant to the Existing Credit Agreement;
(d) the Security Documents executed pursuant to this Agreement amend, renew, extend, modify,
replace, restate, substitute for, and supersede in their entirety (but do not extinguish or impair
the collateral security created or evidenced by) the “Security Documents,” executed and delivered
pursuant to the Existing Credit Agreement; and (e) the entering into and performance of their
respective obligations under the Loan Documents and the transactions evidenced hereby do not
constitute a novation nor shall they be deemed to have terminated, extinguished, or discharged the
“Obligations” under the Existing Credit Agreement, or the “Security Documents,” or the other “Loan
Documents” (or the collateral security therefor) executed in connection with the Existing Credit
Agreement, all of which Indebtedness and Collateral shall continue under and be governed by this
Agreement and the other Loan Documents, except as expressly provided otherwise herein or therein.
Each Lender that is a “Lender” under the Existing Credit Agreement hereby waives any requirement
thereunder to receive prior notice of the prepayment of any loans and/or termination or reduction
of commitments thereunder, if applicable, and each Lender that is a “Lender” under the Existing
Credit Agreement agrees that as of the Closing Date it shall have, and continue to have, a
Revolving Credit Commitment hereunder in the amount equal to such Lender’s Percentage (as set forth
on Schedule II) of the Revolving Credit Commitment Amount on the Closing Date.

     SECTION 10.20. Limited Consent. The Borrowers have informed the Lenders that the
Borrowers’ issuance and sale of the Senior Secured Notes (as permitted by Section
7.2.2(g)), and the granting of the Liens on the Indenture Collateral to secure the Senior
Secured Notes (as permitted by Section 7.2.3(c)(ii)), may cause one or more defaults or
events of default under the Existing Indenture, and that such defaults or events of default may
cause an Event of Default under Section 8.1.5 (the “Potential Cross-Default”). The
Borrowers have requested that the Lenders consent to the Potential Cross-Default. Subject to the
terms and conditions set forth herein and in reliance upon the representations and warranties
herein contained, the Lenders hereby consent to the Potential Cross-Default, but solely to the
extent that such Potential Cross-
Default is a result of the issuance and sale of the Senior Secured Notes and/or the granting
of the Liens on the Indenture Collateral to secure the Senior Secured Notes; provided that
the foregoing consent shall terminate automatically, and this consent shall be of no further force
or effect, (i) if any holder of the Existing Senior Secured Notes takes any action to foreclose
upon any Lien

115

 

securing the Existing Senior Secured Notes, (ii) if, as a result of a default or
event of default under the Existing Indenture, any holder of the Existing Senior Secured Notes
takes any other enforcement or other remedial action that is harmful in any material respect to the
Lenders, or (iii) if, on or before the 31st day after the Closing Date, the Existing Senior Secured
Notes have not been paid in full. By agreeing to the limited consent in this Section
10.20, the Lenders have not waived, and do not hereby waive, any rights or remedies they now
have under the Credit Agreement or under any other Loan Document or any additional rights or
remedies they may have as a result of any breach of any of the Loan Documents resulting from or in
any way related to the Potential Cross-Default, other than as specifically set forth in this
Section 10.20.

     SECTION 10.21. Release of Collateral and Obligations. (a) If any of the Collateral
shall be Disposed of by any Loan Party in a transaction permitted by this Agreement and the other
Loan Documents, or upon the effectiveness of any written consent to the release of any Lien created
under any Security Document in respect of any Collateral pursuant to and in accordance with the
requirements of this Agreement and the other Loan Documents, all Liens created hereunder in such
Collateral shall be automatically released, all without delivery of any instrument or performance
of any act by any party. Any Borrower (other than the Company) that is a Restricted Subsidiary
shall be automatically released from its Obligations hereunder and under the other Loan Documents,
and all Liens created hereunder in the Collateral owned by, and in the Capital Stock issued by,
such Borrower shall be automatically released, all without delivery of any instrument or
performance of any act by any party, upon consummation of any transaction (other than a merger or
consolidation with another Borrower in which such Borrower is not the survivor) permitted by this
Agreement as a result of which such Borrower ceases to be a Subsidiary. In connection with any
termination or release pursuant to this paragraph (a), the Administrative Agent shall execute and
deliver to each applicable Borrower, at such Borrower’s sole expense, all documents as such
Borrower shall reasonably request to evidence such termination or release; provided that
the Borrower shall have delivered to the Administrative Agent, at least five Business Days prior to
the date of the proposed termination or release (or such shorter period agreed to by the
Administrative Agent), a written request for termination or release identifying the relevant
Collateral being Disposed of in such Disposition or Subsidiary ceasing to be such and the terms
thereof in reasonable detail, including the date thereof and the price thereof, together with a
certification by the Borrower stating that such transaction is in compliance with this Agreement
and the other Loan Documents and that the proceeds of such Disposition will be applied in
accordance with this Agreement and the other Loan Documents.

     (b) Notwithstanding anything to the contrary contained herein or any other Loan
Document, upon the Termination Date, (i) the Collateral of every Borrower shall be
automatically released from the Liens created hereby, and the Obligations hereunder or under
any Loan Document of any Borrower (other than any contingent indemnification or expense
reimbursement Obligations expressly provided for in Section 10.5 or elsewhere herein to
survive the Termination Date) shall be terminated; and (ii) at the request of the
Company, the Administrative Agent shall (without notice to, or vote or consent of, any
Lender or other Secured Party) take such actions as shall be reasonably necessary or
desirable to release its Lien in all Collateral securing the Obligations.

     SECTION 10.22 Accounting Changes. In the event that any “Accounting Change” (as defined
below) shall occur and such change results in a change in the method of calculation of

116

 

financial
covenants, standards or terms in this Agreement and if the Company notifies the Administrative
Agent that the Company wishes to or the Administrative Agent notifies the Company that the Required
Lenders wish to, amend any financial covenants, standards or terms in this Agreement to eliminate
the effect of such Accounting Change, then the Company and the Administrative Agent agree to enter
into negotiations in order to amend such provisions of this Agreement so as to equitably reflect
such Accounting Change with the desired result that the criteria for evaluating the Borrowers’
financial condition shall be the same after such Accounting Change as if such Accounting Change had
not been made. Until such time as such an amendment shall have been executed and delivered by the
Company, the Administrative Agent and the Required Lenders (or the Company or the Administrative
Agent, as the case may be, shall have withdrawn their request for an amendment), all financial
covenants, standards and terms in this Agreement shall continue to be calculated or construed as if
such Accounting Change had not occurred. “Accounting Change” refers to any change in
accounting principles required or permitted by the promulgation of any rule, regulation,
pronouncement or opinion by the Financial Accounting Standards Board of the American Institute of
Certified Public Accountants or, if applicable, the SEC.

     SECTION 10.21. Documentation Agent. The Lender identified in this Agreement as
“Documentation Agent” has no right, power, obligation, liability, responsibility or duty under this
Agreement other than those applicable to all Lenders as such. Without limitation of the foregoing,
the Lender so identified “Documentation Agent” shall not have and shall not be deemed to have any
fiduciary relationship with any Lender. Each Lender acknowledges that it has not relied, and will
not rely, on the Lender so identified as “Documentation Agent” in taking or not taking action
hereunder.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK;

SIGNATURE PAGES TO FOLLOW]

117

 

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

	 	 	 	 	 
	 	BORROWERS:

STERLING CHEMICALS, INC.,

     as a Borrower

 	 
	 	By:  	 	 
	 	 	Paul G. Vanderhoven 	 
	 	 	Senior Vice President - Finance and

 Chief Financial
Officer 	 
	 
	 	STERLING CHEMICALS ENERGY, INC.,

     as a Borrower

 	 
	 	By:  	 	 
	 	 	Paul G. Vanderhoven 	 
	 	 	Vice President 	 
	 

Signature Page to Amended and Restated Revolving Credit Agreement

 

 

	 	 	 	 	 
	 	LENDERS:

THE CIT GROUP/BUSINESS CREDIT, INC.,

     as the Administrative Agent and as a Lender

 	 
	 	By:  	 	 
	 	 	Chad Ramsey 	 
	 	 	Vice President 	 
	 

Signature Page to Amended and Restated Revolving Credit Agreement

 

 

	 	 	 	 	 
	 	WACHOVIA BANK, NATIONAL ASSOCIATION,

     as the Documentation Agent and as a Lender

 	 
	 	By:  	 	 
	 	 	Joe Curdy 	 
	 	 	Director 	 
	 

Signature Page to Amended and Restated Revolving Credit Agreement

 

 

SCHEDULE I

DISCLOSURE SCHEDULE

Item 1.1 – Designated Shareholders

	1.	 	Resurgence Asset Management, L.L.C. and its and its Affiliates’ managed funds and accounts.
	 
	2.	 	Any Permitted Transferee with respect to any Person covered by the preceding clause (1).
	 
	3.	 	Any savings or investment plan sponsored by Sterling Chemicals, Inc.

Item 6.8 – Existing Subsidiaries

Sterling Chemicals Energy, Inc.

Item 6.12 – Environmental Matters

          None

Item 6.18 – Material Contracts

	1.	 	Second Amended and Restated Plasticizers Production Agreement dated January 1, 2006 between
BASF Corporation and Sterling Chemicals, Inc.
	 
	2.	 	License Agreement dated August 1, 1986, between Monsanto Company and Sterling Chemicals, Inc.
	 
	3.	 	Second Amended and Restated Production Agreement dated effective as of August 1, 1996,
between BP Chemicals Inc. and Sterling Chemicals, Inc., as amended.
	 
	4.	 	Amended and Restated Product Supply Agreement, dated January 1, 2006 between Praxair Hydrogen
Supply, Inc. and Sterling Chemicals, Inc., as amended by Second Amendment to Utilities
Agreement dated as of July 1, 2006.
	 
	5.	 	Acetic Acid Technology Agreement, dated December 30, 1997, among Sterling Chemicals, Inc., BP
Chemicals, Ltd., BP Chemicals Inc. and Sterling Chemicals, Inc.

 

 

Item 7.2.3(b) – Ongoing Liens

	1.	 	Liens granted under each of the following documents:

	 	(a)	 	Second Amended and Restated Production Agreement dated as of December 30, 1997
but effective as of August 1, 1996 between Sterling Chemicals, Inc. and BP Chemicals
Inc. (n/k/a BP Amoco Chemical Company), as amended.
	 
	 	(b)	 	Ground Lease Agreement dated as of May 15, 1995 between Sterling Chemicals,
Inc. and Praxair Hydrogen Supply, Inc., as amended.
	 
	 	(c)	 	Ground Lease Agreement dated February 8, 1991 between Sterling Chemicals, Inc.
and S&L Cogeneration Company, as amended.
	 
	 	(d)	 	Second Amended and Restated Plasticizers Production Agreement dated January 1,
2006 between Sterling Chemicals, Inc. and BASF Corporation, as amended.
	 
	 	(e)	 	UCC-1 financing statement filed with the Delaware Secretary of State on July
21, 2005 as file number 52247675, and UCC-1 financing statement filed with the Texas
Secretary of State on October 9, 2000, as file number 00-600182, listing Sterling
Chemicals, Inc. as debtor and NMGH Financial Services, Inc. as secured party.

	2.	 	Liens identified as “Permitted Encumbrances” under the Indenture Deed of Trust.

Item 7.2.4(a) –Ongoing Investments

107,418 shares of Series “A-1” Preferred Stock of ChemConnect, Inc.

2,500 shares of common stock of Primex, Ltd.

4,164 shares of Series “A” Preferred Stock of Primex, Ltd.

1 share of Series “C” Preferred Stock of Primex, Ltd.

2 shares of common stock of Georgia Gulf Corporation.

10 shares of common stock of Monsanto Company (in process of getting reissued to Sterling in current share amounts by Pfizer Inc.).

2 shares of common stock of Chevron Corporation.

50% interest in S&L Cogeneration Company.

 

 

Item 7.2.12 – Transactions with Affiliates

     None

 

 

SCHEDULE II

PERCENTAGES; NOTICE ADDRESS

THE BORROWERS:

c/o

Sterling Chemicals, Inc.

333 Clay Street, Suite 3600

Houston, Texas 77002 4312

Attention: General Counsel

Fax: (713) 654-9577

khale@sterlingchemicals.com

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	COMMITMENT	 	 
	             LENDER:	 	COMMITMENT AMOUNT	 	PERCENTAGE	 	ADDRESS
	The CIT Group/Business

	 	$	30,000,000	 	 	 	60	%	 	Two Lincoln Centre
	Credit, Inc

	 	 	 	 	 	 	 	 	 	5420 LBJ Freeway – Suite 200
	 

	 	 	 	 	 	 	 	 	 	Dallas, TX 75240
	 

	 	 	 	 	 	 	 	 	 	Attn: Chad Ramsey
	 

	 	 	 	 	 	 	 	 	 	Fax: (972) 455-1690
	 

	 	 	 	 	 	 	 	 	 	chad.ramsey@cit.com
	 
	 	 	 	 	 	 	 	 	 	 
	Wachovia Bank, National

	 	$	20,000,000	 	 	 	40	%	 	1201 Main Street
	Association

	 	 	 	 	 	 	 	 	 	Suite 1625
	 

	 	 	 	 	 	 	 	 	 	Dallas, TX 75202
	 

	 	 	 	 	 	 	 	 	 	Attn: Joe Curdy
	 

	 	 	 	 	 	 	 	 	 	Fax: 214-748-9118
	 

	 	 	 	 	 	 	 	 	 	joe.curdy@wachovia.com

 

 

SCHEDULE III

ACCOUNT OBLIGOR SCHEDULE

ACCEPTABLE ACCOUNTS

BASF Group

(including Polioles S.A. de C.V.)

BP Amoco PLC

Royal Dutch Shell PL

 

 

SCHEDULE IV

APPROVED DEPOSITORY BANKS

JPMorgan Chase Bank, N.A.

 

 

SCHEDULE V

EXISTING LETTERS OF CREDIT

	 	 	 	 	 	 	 	 	 	 	 
	DATE	 	DATE	 	 	 	 	 	 
	ISSUED	 	EXPIRES	 	LC#	 	BENEFICIARY	 	US$AMOUNT
	1/18/2006

	 	1/31/2008
	 	TTTS227435
	 	RLI Insurance Co.
	 	$	1,061,020.00	 
	11/03/2004

	 	11/08/2007
	 	T614201
	 	Texas Commission on Environmental Quality
	 	$	769,682.00	 
	7/17/2000

	 	7/14/2007
	 	T203320
	 	Pacific Employers Ins. Co.
	 	$	50,000.00	 
	7/01/2002

	 	7/01/2007
	 	T215001
	 	Zurich American Ins. Co.
	 	$	525,000.00	 
	7/23/1999

	 	6/30/2007
	 	T290209
	 	Reliance National Indemnity Co.
	 	$	50,000.00	 
	8/27/1999

	 	6/30/2007
	 	T290213
	 	United Pacific Ins. Co.
	 	$	313,666.55	 

 

 

SCHEDULE VI

POST CLOSING REQUIREMENTS

The Borrowers shall satisfy, in form and substance reasonably satisfactory to the Administrative
Agent, the requirements set forth below on or before the date specified for such requirement or
such later date to be determined by the Administrative Agent:

1. No later than thirty (30) days after the Closing Date, the Borrowers shall deliver a Control
Agreement with respect to each of the following deposit accounts and the lockbox maintained with
JPMorgan Chase Bank, N.A: Account No.: 001-034-13945 (money market account); 36000164 (overnight
investments); 001-034-13978 (general account) and Lockbox 88852.exv10w2

 

EXHIBIT 10.2

AMENDED AND RESTATED SECURITY AGREEMENT

     THIS AMENDED AND RESTATED SECURITY AGREEMENT (as amended, supplemented, amended and restated
or otherwise modified from time to time, this “Agreement”), dated as of March 29, 2007, is
made by STERLING CHEMICALS, INC., a Delaware corporation, and STERLING CHEMICALS ENERGY, INC., a
Delaware corporation (each, individually, a “Borrower” and, collectively, the
“Borrowers”), and each other Person (such capitalized term and all other capitalized terms
not otherwise defined herein shall have the meanings provided for or incorporated by reference in
Article I below) that may from time to time become, pursuant to the terms of the Credit
Agreement, a party to this Agreement (each such Person and each Borrower individually a
“Grantor” and, together with all such other Persons and all Borrowers, collectively, the
“Grantors”), in favor of THE CIT GROUP/BUSINESS CREDIT, INC., as Administrative Agent for
the Secured Parties (together with its successors and assigns in such capacity, the
“Administrative Agent”).

RECITALS:

     A. On December 19, 2002, the Borrowers, the Administrative Agent and the lenders party thereto
entered into a Revolving Credit Agreement (the “Existing Credit Agreement”), pursuant to
which, among other things the Borrowers entered into a Security Agreement, dated as of December 19,
2002, in favor of the Administrative Agent for the benefit of the lenders party to such Existing
Credit Agreement (the “Existing Security Agreement”).

     B. Pursuant to an Amended and Restated Revolving Credit Agreement, dated as of the date hereof
(as amended, supplemented, amended and restated or otherwise modified from time to time, the
“Credit Agreement”), among the Borrowers, the various financial institutions as are, or may
from time to time become, parties thereto (the “Lenders”), and the Administrative Agent,
the Lenders and the Issuer have (i) amended and restated the Existing Credit Agreement and (ii)
extended Commitments to make Credit Extensions to the Borrowers.

     C. As a condition precedent to the making of each Credit Extension (including the initial
Credit Extension) under the Credit Agreement, each Grantor is required to execute and deliver this
Agreement.

     D. Each Grantor has duly authorized the execution, delivery and performance of this Agreement.

     E. It is in the best interest of each Grantor to execute this Agreement inasmuch as such
Grantor will derive substantial direct and indirect benefits from the Credit Extensions made from
time to time to the Borrowers by the Lenders and the Issuer pursuant to the Credit Agreement and
the providing of Banking Services to the Borrowers and the execution and delivery of the Hedging
Agreements between the Borrowers and certain Lenders.

     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and in order to induce (i) the Lenders, the Swing Line Lender

 

 

and the Issuer to make Revolving Credit Loans and Swing Line Loans and issue Letters of Credit
pursuant to the Credit Agreement and (ii) the Secured Parties to provide Banking Services to the
Borrowers and to enter into Hedging Agreement(s), the parties hereto hereby amend and restate the
Existing Security Agreement, and each Grantor jointly and severally agrees, for the benefit of each
Secured Party, as follows

ARTICLE I

DEFINITIONS

     SECTION 1.1. Certain Terms. The following terms (whether or not underscored) when
used in this Agreement, including its preamble and recitals, shall have the following meanings
(such definitions to be equally applicable to the singular and plural forms thereof):

     “Administrative Agent” is defined in the preamble.

     “Agreement” is defined in the preamble.

     “Borrower” and “Borrowers” are defined in the preamble.

     “Collateral” is defined in Section 2.1.

     “Computer Hardware and Software Collateral” means:

     (a) all computer and other electronic data processing hardware, integrated computer
systems, central processing units, memory units, display terminals, printers, features,
computer elements, card readers, tape drives, hard and soft disk drives, cables, electrical
supply hardware, generators, power equalizers, accessories and all peripheral devices and
other related computer hardware;

     (b) all software programs (including both source code, object code and all related
applications and data files), whether now owned, licensed or leased or hereafter acquired by
any Grantor, designed for use on the computers and electronic data processing hardware
described in clause (a) above;

     (c) all firmware associated therewith;

     (d) all documentation (including flow charts, logic diagrams, manuals, guides and
specifications) with respect to such hardware, software and firmware described in the
preceding clauses (a) through (c); and

     (e) all rights with respect to all of the foregoing, including any and all copyrights,
licenses, options, warranties, service contracts, program services, test rights, maintenance
rights, support rights, improvement rights, renewal rights and indemnifications and any
substitutions, replacements, additions or model conversions of any of the foregoing.

2

 

     “Copyright Collateral” means all copyrights of each Grantor, whether statutory or
common law, registered or unregistered, now or hereafter in force in the United States including
all of such Grantor’s right, title and interest in and to all copyrights registered in the United
States Copyright Office, and all applications for registration thereof, whether pending or in
preparation, all copyright licenses in the United States, the right to sue for past, present and
future infringements of any thereof, all rights corresponding thereto, all extensions and renewals
of any thereof and all Proceeds of the foregoing, including licenses, royalties, income, payments,
claims, damages and proceeds of suit.

     “Credit Agreement’’ is defined in recital B.

     “Disposition” means, with respect to any property, any sale, long-term ground lease,
Sale/Leaseback Transaction or similar transfer (whether by foreclosure, deed-in-lieu of
foreclosure, assignment or otherwise) of such property, in each case to any Person (other than a
Borrower or any Restricted Subsidiary of any Borrower).

     “Excluded Contracts” means, with respect to any Grantor, all contracts for the receipt
by such Grantor of services or supplies but excluding any contracts that give rise to the payment
of money to such Grantor .

     “Excluded Equipment” means, to the extent any of the following items constitute
fixtures and/or Equipment under applicable laws, all fixtures, fittings, appliances, apparatus,
Equipment, machinery, building and construction materials and other articles of every kind and
nature whatsoever (other than Inventory) and all replacements thereof and additions, enhancements
or upgrades thereto, now or hereafter affixed, or attached to, placed upon or located on or in the
Real Property or any buildings, structures and other improvements thereon.

     “Excluded Equity” means the Capital Securities issued by each Unrestricted Subsidiary.

     “Excluded Intellectual Property” means, collectively, (a) all patentable inventions,
letters patent and applications for letters patent that are necessary or appropriate for the
continued operation of the plants located at the Real Property, and (b) all Trade Secrets that are
necessary or appropriate for the continued operation of the plants located at the Real Property.

     “Existing Credit Agreement’’ is defined in recital A.

     “Existing Security Agreement’’ is defined in recital A.

     “Grantor” and “Grantors” are defined in the preamble.

     “Intellectual Property Collateral” means, collectively, the Computer Hardware and
Software Collateral, the Copyright Collateral, the Patent Collateral, the Trademark Collateral and
the Trade Secrets Collateral, but excluding (x) the Excluded Intellectual Property, and (y) to the
extent the same constitute Intellectual Property Collateral, the Excluded Contracts.

     “Lenders” is defined in recital B.

3

 

     “Patent Collateral” means:

     (a) all letters patent and applications for letters patent in the United States,
including all patent applications in preparation for filing in the United States;

     (b) all reissues, divisions, continuations, continuations-in-part, extensions, renewals
and reexaminations of any of the items described in clause (a);

     (c) all patent licenses in the United States; and

     (d) all Proceeds of, and rights associated with, the foregoing (including license
royalties and Proceeds of infringement suits), the right to sue third parties for past,
present or future infringements of any patent or patent application, referred to in
clauses (a) or (b) above, and for breach or enforcement of any patent
license referred to in clause (c) above.

     “Real Property” means all real property now owned or hereafter acquired by any
Grantor, including, without limitation, that certain real property located in Galveston County,
Texas, more particularly described on Exhibit A of the Indenture Deed of Trust.

     “Receivable” means any right to payment for Goods sold, leased or licensed or for
services rendered, whether or not such right is evidenced by an Instrument or Chattel Paper and
whether or not it has been earned by performance (including, without limitation, any Account).

     “Sale/Leaseback Transaction” means an arrangement relating to property now owned or
hereafter acquired whereby a Borrower or a Restricted Subsidiary of a Borrower transfers such
property to a Person (other than a Borrower or a Restricted Subsidiary of a Borrower) and a
Borrower or a Restricted Subsidiary of a Borrower leases such transferred property from such
transferee.

     “Termination Date” means the date on which all Obligations (other than any contingent
indemnification or expense reimbursement Obligations that are not then due and payable) have been
paid in full in cash, all Letters of Credit have been terminated, expired or Cash Collateralized,
all Hedging Agreements have been terminated and all Commitments have been permanently terminated.

     “Trademark Collateral” means:

     (a) all trademarks, trade names, corporate names, company names, business names,
fictitious business names, trade styles, service marks, certification marks, collective
marks, logos, other source of business identifiers, designs and General Intangibles of a
like nature (all of the foregoing items in this clause (a) being collectively called
a “Trademark”), now existing anywhere in the United States or hereafter adopted or
acquired in the United States, whether currently in use or not, all registrations and
recordings thereof and all applications in connection therewith, whether pending or in

4

 

preparation for filing, including registrations, recordings and applications in the
United States Patent and Trademark Office or in any office or agency of the United States of
America or any State;

     (b) all Trademark licenses in the United States;

     (c) all reissues, extensions or renewals of any of the items described in clauses
(a) and (b);

     (d) all of the goodwill of the business connected with the use of, and symbolized by
the items described in, clauses (a) through (c); and

     (e) all Proceeds of, and rights associated with, the foregoing, including any claim by
any Grantor against third parties for past, present or future infringement or dilution of
any Trademark, Trademark registration or Trademark license, including any Trademark,
Trademark registration or Trademark license referred to in clauses (a)
through (c) above, or for any injury to the goodwill associated with the use of any
such Trademark or for breach or enforcement of any such Trademark license.

     “Trade Secrets Collateral” means all common law and statutory trade secrets and all
other confidential or proprietary information and know-how used or obtained at any time for use in
the business of any Grantor (all of the foregoing being collectively called a “Trade
Secret”), whether or not such Trade Secret has been reduced to a writing or other tangible
form, including all documents and things embodying, incorporating or referring in any way to such
Trade Secret, all Trade Secret licenses, and including the right to sue for and to enjoin and to
collect damages for the actual or threatened misappropriation of any Trade Secret and for the
breach or enforcement of any such Trade Secret license.

     “U.C.C.” means the Uniform Commercial Code in effect in the State of New York, as the
same may be amended from time to time.

     SECTION 1.2. Credit Agreement Definitions. Unless otherwise defined herein or the
context otherwise requires, terms used in this Agreement, including its preamble and recitals, have
the meanings provided in the Credit Agreement.

     SECTION 1.3. U.C.C. Definitions. Unless otherwise defined herein, the following
terms which are defined in the Uniform Commercial Code in effect in the State of New York on the
date hereof are used in this Agreement as so defined: Account, Chattel Paper, Commercial Tort
Claim, Deposit Account, Document, Electronic Chattel Paper, Equipment, General Intangible, Good,
Instrument, Inventory, Investment Property, Letter-of-Credit Right, Proceeds, Record, Supporting
Obligation and Tangible Chattel Paper.

ARTICLE II

SECURITY INTEREST

5

 

     SECTION 2.1. Grant of Security. Each Grantor hereby assigns, pledges, hypothecates,
charges, delivers and transfers to the Administrative Agent, for its benefit and the benefit of
each of the Secured Parties, and hereby grants to the Administrative Agent, for its benefit and the
benefit of each of the Secured Parties, a continuing security interest in all of such Grantor’s
right, title and interest in and to the following, whether now owned or hereafter existing or
acquired by such Grantor (the “Collateral”):

     (a) all Accounts and all books, other Records and Proceeds with respect thereto;

     (b) all Chattel Paper (including without limitation all Tangible Chattel Paper and
Electronic Chattel Paper) and all books, other Records and Proceeds with respect thereto;

     (c) all Deposit Accounts, including without limitation each Controlled Deposit Account
(including all deposits and investments therein and all earnings thereon), and all books,
other Records and Proceeds with respect thereto, but excluding (x) the Escrow Account, and
(y) any Proceeds with respect to the Escrow Account;

     (d) all Documents and all books, other Records and Proceeds with respect thereto;

     (e) all General Intangibles (other than Excluded Contracts) and all books, other
Records and Proceeds with respect thereto;

     (f) all Inventory and all books, other Records and Proceeds with respect thereto;

     (g) all other Goods (including without limitation all Equipment but excluding the
Excluded Equipment) and all books, other Records and Proceeds with respect thereto;

     (h) all Instruments and all books, other Records and Proceeds with respect thereto;

     (i) all Intellectual Property Collateral and all books, other Records and Proceeds with
respect thereto;

     (j) all Investment Property and all books, other Records and Proceeds with respect
thereto;

     (k) all Letter-of-Credit Rights and all books, other Records and Proceeds with respect
thereto;

     (l) all Receivables not otherwise described above and all books, other Records and
Proceeds with respect thereto; and

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     (m) all Supporting Obligations and all books, other Records and Proceeds with respect
thereto.

Notwithstanding the foregoing, the “Collateral” shall not include (i) any Proceeds (other than
Capital Securities of a Borrower or a Restricted Subsidiary of a Borrower) arising from a
Disposition, casualty or condemnation of Excluded Equipment or Excluded Contracts, (ii) any General
Intangibles or other rights arising under any contract, instrument, license or other document as to
which the grant of a security interest would constitute a violation of a valid and enforceable
restriction on such grant in favor of the Person(s) (other than such Grantor) obligated on such
contract, instrument, license or other document, unless and until any required consents shall have
been obtained, or (iii) any Excluded Equity. Each Grantor agrees to use commercially reasonable
efforts to obtain any such required consent with respect to any material item described in clause
(ii) of the immediately preceding sentence.

     SECTION 2.2. Security for Obligations. This Agreement secures the payment in cash in
full of all Obligations.

     SECTION 2.3. Continuing Security Interest. This Agreement shall create a continuing
security interest in the Collateral and shall:

     (a) remain in full force and effect until the Termination Date;

     (b) be binding upon each Grantor, its successors, transferees and assigns; and

     (c) inure, together with the rights and remedies of the Administrative Agent hereunder,
to the benefit of the Administrative Agent and each other Secured Party.

Without limiting the generality of the foregoing clause (c), any Secured Party may assign
or otherwise transfer (in whole or in part) any Revolving Credit Commitment or Swing Line Loan
Commitment or Loan held by it to any other Person, and such other Person shall thereupon become
vested with all the rights and benefits in respect thereof granted to such Secured Party under any
Loan Document or otherwise, subject, however, to any contrary provisions in such assignment or
transfer, and to the provisions of Section 10.11 of the Credit Agreement. Upon the sale,
transfer or other disposition of Collateral in accordance with the Credit Agreement, the security
interests granted herein shall automatically terminate with respect to such Collateral, but not the
Proceeds thereof. Additionally, upon the designation of any Restricted Subsidiary as an
Unrestricted Subsidiary in accordance with Section 7.1.12 of the Credit Agreement and the
Administrative Agent’s receipt of a written request from the Company for the release of the Capital
Securities issued by such Unrestricted Subsidiary from the Lien created hereunder, the
Administrative Agent shall promptly release such Lien, provided that no Default then exists
and the Lien created hereunder encumbering all other Collateral shall remain in full force and
effect. Subject to the last sentence of this Section 2.5, this Agreement (other than the
indemnification and expense reimbursement provisions set forth in Section 6.4 and any other
contingent indemnification or expense reimbursement Obligations expressly provided for herein or in
any other Loan Document to survive the Termination Date) and the security interest granted herein
shall terminate and all rights to the Collateral shall revert to each Grantor on the Termination

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Date. Upon any sale, transfer, disposition or termination described in any of the three
immediately preceding sentences, the Administrative Agent will, at the applicable Grantor’s sole
expense, execute and deliver to such Grantor, without any representations, warranties or recourse,
such documents as such Grantor may reasonably request to evidence such termination, release or
reassignment. Notwithstanding anything to the contrary contained herein or in any other Loan
Document, each Grantor agrees that: (i) to the extent that, after payment in full of all
Obligations, the termination, expiration or Cash Collateralization of all Letters of Credit, and
the termination of all Hedging Agreements, such payment or any part thereof is subsequently
invalidated, voided, declared to be fraudulent or preferential, set aside, recovered, rescinded or
is required to be retained by or repaid to a trustee, receiver, or any other Person under any
bankruptcy code, common law, or equitable cause, then the Lien and security interest in the
Collateral created hereunder shall be revived, reinstated and continued in full force and effect,
as if said payment had not been made; and (ii) the Lien and security interest in the Collateral
created hereunder shall not be released or discharged by any payment to the Administrative Agent or
any Secured Party from any source that is thereafter paid, returned or refunded in whole or in part
by reason of the assertion of a claim of any kind relating thereto, including, but not limited to,
any claim for breach of contract, breach of warranty, preference, illegality, invalidity, or fraud
asserted by any account debtor or by any other Person.

     SECTION 2.4. Grantor Remains Liable. Anything herein to the contrary
notwithstanding:

     (a) each Grantor will remain liable under the contracts and agreements included in the
Collateral to the extent set forth therein, and will perform all of its duties and
obligations under such contracts and agreements to the same extent as if this Agreement had
not been executed;

     (b) the exercise by the Administrative Agent of any of its rights hereunder will not
release any Grantor from any of its duties or obligations under any such contracts or
agreements included in the Collateral; and

     (c) neither the Administrative Agent nor any other Secured Party will have any
obligation or liability under any such contracts or agreements included in the Collateral by
reason of this Agreement, nor will the Administrative Agent or any other Secured Party be
obligated to perform any of the obligations or duties of any Grantor thereunder or to take
any action to collect or enforce any claim for payment assigned hereunder.

     SECTION 2.5. Security Interest Absolute. All rights of the Administrative Agent and
the security interests granted to the Administrative Agent hereunder, and all obligations of each
Grantor hereunder, shall be absolute and unconditional, irrespective of:

     (a) any lack of validity or enforceability of any Loan Document;

     (b) the failure of any Secured Party

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     (i) to assert any claim or demand or to enforce any right or remedy against
the Borrowers or any other Person under the provisions of any Loan Document or
otherwise or

     (ii) to exercise any right or remedy against any guarantor of, or collateral
securing, any Obligations;

     (c) any change in the time, manner or place of payment of, or in any other term of, all
or any of the Obligations or any other extension, compromise or renewal of any Obligations;

     (d) any reduction, limitation, impairment or termination of any Obligations for any
reason (other than the repayment in full and in cash of all Obligations), including any
claim of waiver, release, surrender, alteration or compromise, and shall not be subject to
(and each Grantor hereby waives any right to or claim of) any defense or set-off,
counterclaim, recoupment or termination whatsoever by reason of the invalidity, illegality,
nongenuineness, irregularity, compromise or unenforceability of, or any other event or
occurrence affecting, any Obligations or otherwise;

     (e) any amendment to, rescission, waiver or other modification of, or any consent to
departure from, any of the terms of any Loan Document;

     (f) any addition, exchange, release, surrender or non-perfection of any collateral
(including the Collateral) or any amendment to or waiver or release of or addition to or
consent to departure from any guaranty for any of the Obligations; or

     (g) any other circumstances which might otherwise constitute a defense available to, or
a legal or equitable discharge of, any Borrower, any surety or any guarantor.

     SECTION 2.6. Postponement of Subrogation, etc. Each Grantor hereby agrees that it
will not exercise any rights which it may acquire by reason of any payment made hereunder, whether
by way of subrogation, reimbursement or otherwise, until the Termination Date. Any amount paid to
any Grantor on account of any payment made hereunder prior to the Termination Date shall be held in
trust for the benefit of the Secured Parties and shall immediately be paid to the Administrative
Agent for the benefit of the Secured Parties and credited and applied against the Obligations,
whether matured or unmatured, in accordance with the terms of the Credit Agreement;
provided, however, that if:

     (a) such Grantor has made payment to the Administrative Agent for the benefit of the
Secured Parties of all or any part of the Obligations; and

     (b) the Termination Date has occurred,

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each Secured Party agrees that, at the requesting Grantor’s request, the Administrative Agent, on
behalf of the Secured Parties, will execute and deliver to such Grantor appropriate documents
(without recourse and without representation or warranty) necessary to evidence the transfer by
subrogation to such Grantor of an interest in the Obligations resulting from such payment by such
Grantor. In furtherance of the foregoing, prior to the Termination Date, each Grantor shall
refrain from taking any action or commencing any proceeding against any Borrower (or its successors
or assigns, whether in connection with a bankruptcy proceeding or otherwise) to recover any amounts
in respect of payments made under this Agreement to the Administrative Agent or any other Secured
Party.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

     SECTION 3.1. Representations and Warranties. Each Grantor represents and warrants to
each Secured Party as set forth in this Article III.

     SECTION 3.2. Location of Collateral, etc. All of the Equipment, Inventory and
Deposit Accounts of such Grantor are respectively located at the places specified in Item 3 of
the Perfection Certificate. None of the Equipment or Inventory has, within the four months
preceding the date of this Agreement if then owned by such Grantor, been located at any place other
than the places specified in Item 3 of the Perfection Certificate. The principal place of
business and chief executive office of such Grantor and the office where such Grantor keeps its
Records concerning the Receivables, and all originals of all Chattel Paper which evidence
Receivables, are located at the address set forth in Item 3 of the Perfection Certificate.
Such Grantor has no trade names other than those specified in Item 1(d) of the Perfection
Certificate. During the four months preceding the date hereof, such Grantor has not been known
by any legal name different from the one set forth on Item 1(a) of the Perfection
Certificate, nor has such Grantor been the subject of any merger or other corporate
reorganization, except as set forth in Item 1(c) of the Perfection Certificate. All
Receivables evidenced by a promissory note or other Instrument, negotiable document or Chattel
Paper have been duly endorsed and accompanied by duly executed instruments of transfer or
assignment, all in form and substance reasonably satisfactory to the Administrative Agent and
delivered and pledged to the Administrative Agent pursuant to Section 4.6. Such Grantor is
not a party to any Federal, State or local government contract except as set forth in Item 13
of the Perfection Certificate.

     SECTION 3.3. Ownership, No Liens, etc. Such Grantor owns its Collateral free and
clear of any Lien, except for the security interest created by this Agreement and Permitted Liens.
No effective financing statement or other instrument similar in effect covering all or any part of
the Collateral is on file in any recording office, except such as may have been filed in favor of
the Administrative Agent relating to this Agreement or as have been filed in connection with
Permitted Liens.

     SECTION 3.4. Possession and Control. Such Grantor has exclusive possession and
control of its Equipment and Inventory except where the absence of possession and control results
from actions of such Grantor in the ordinary course of business.

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     SECTION 3.5. Negotiable Documents, Instruments and Chattel Paper. Such Grantor has,
prior to or contemporaneously herewith, delivered to the Administrative Agent possession of all
originals of all negotiable documents, Instruments and Chattel Paper currently owned or held by
such Grantor (duly endorsed in blank, if requested by the Administrative Agent).

     SECTION 3.6. Intellectual Property Collateral. With respect to any Intellectual
Property Collateral owned by such Grantor the loss, impairment or infringement of which could
reasonably be expected to have a Material Adverse Effect:

     (a) such Intellectual Property Collateral is subsisting and has not been adjudged
invalid or unenforceable, in whole or in part;

     (b) such Intellectual Property Collateral is valid and enforceable;

     (c) such Grantor has made all necessary filings to record its ownership of the
registrations and applications included in such Intellectual Property Collateral in the
United States Patent and Trademark Office and the United States Copyright Office, as
applicable;

     (d) such Grantor is the owner of the unencumbered right, title and interest in and to
such Intellectual Property Collateral (except for (i) Liens created under the Loan
Documents, (ii) Permitted Liens, and (iii) rights of licensees under licenses of such
Intellectual Property Collateral in the ordinary course of business) and no claim has been
made that the use of such Intellectual Property Collateral does or may violate the asserted
rights of any third party except for claims that could not reasonably be expected to have a
Material Adverse Effect; and

     (e) such Grantor has performed all acts and has paid all required fees and Taxes
required to maintain the registrations and applications filed with respect to any such
Intellectual Property Collateral that is used in and material for, or necessary to, any
Borrower’s business.

Each Grantor owns directly or is entitled to use by license or otherwise, all Patents, Trademarks,
Trade Secrets, Copyrights, licenses, technology, know-how, processes and rights with respect to any
of the foregoing that are used in and material for, or necessary to, the conduct of such Grantor’s
business as currently conducted.

     SECTION 3.7. Validity, etc. This Agreement creates a valid security interest in and
Lien on all Collateral, and, upon the taking of the actions described in Section 3.8(b),
such Lien will be senior to all Liens (other than Liens permitted by clauses (b), (d), (e), (f),
(h) and (k) of Section 7.2.3 of the Credit Agreement).

     SECTION 3.8. Authorization, Approval, etc. Except as have been obtained or made and
are in full force and effect, no material authorization, material approval or other action by, and
no material notice to or material filing with, any Governmental Authority or regulatory body is
required either (a) for the grant by such Grantor of the security interest granted hereby, the

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pledge by such Grantor of any Collateral pursuant hereto or for the execution, delivery and
performance of this Agreement by such Grantor or (b) except for the filing of appropriate financing
statements with the proper filing office in the appropriate jurisdictions under applicable law to
perfect the security interest of the Administrative Agent in the Collateral and such recordings and
registrations as may be required under the trademark, copyright, and patent laws of the United
States and any other jurisdictions where the Borrowers own Intellectual Property Collateral, for
the perfection of or the exercise by the Administrative Agent of its rights and remedies hereunder.

     SECTION 3.9. Compliance with Laws. Such Grantor is in compliance with the
requirements of all applicable laws (including the provisions of the Fair Labor Standards Act),
rules, regulations and orders of every Governmental Authority, the non-compliance with which could
reasonably be expected to have a Material Adverse Effect or which could reasonably be expected to
materially adversely affect the value of the Collateral.

     SECTION 3.10. Commercial Tort Claims. On the Closing Date, no Grantor has any rights
in any Commercial Tort Claim.

ARTICLE IV

COVENANTS

     SECTION 4.1. Certain Covenants. Each Grantor covenants and agrees that, at all times
prior to the Termination Date, such Grantor will, unless the Required Lenders shall otherwise
consent in writing, perform, comply with and be bound by the obligations set forth in this
Article IV.

     SECTION 4.2. As to Equipment and Inventory. Such Grantor hereby agrees that it will:

     (a) keep all the Equipment and Inventory (other than Inventory sold in the ordinary
course of business) at the places therefor specified in Section 3.2 or, upon 30
days’ prior written notice to the Administrative Agent, at such other places in a
jurisdiction where all representations and warranties set forth in Article III shall
be true and correct in all material respects, and all action required pursuant to the
first sentence of Section 4.6 shall have been taken with respect to the
Equipment and Inventory;

     (b) cause the Equipment to be maintained and preserved in its existing condition,
ordinary wear and tear excepted, or in the case of any loss or damage to any of the
Equipment that is material to the operations of any Grantor, as soon as practicable after
the occurrence thereof, make or cause to be made all repairs, replacements and other
improvements in connection therewith which are necessary or desirable to such end; and
promptly furnish to the Administrative Agent a statement respecting any loss or damage to
any of the Equipment in excess of $1,000,000 per occurrence; and

     (c) pay when due all Taxes, assessments and governmental charges imposed upon, and all
claims (including claims for labor, materials and supplies) against the Equipment and
Inventory, except to the extent the validity thereof is being contested in

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good faith by appropriate proceedings and for which adequate reserves in accordance
with GAAP have been set aside.

     SECTION 4.3. As to Receivables. (a) Such Grantor will: (i) keep its chief executive
office and the office(s) where it keeps its Records concerning the Receivables, and all originals
of all Chattel Paper which evidences Receivables (other than Chattel Paper delivered to the
Administrative Agent pursuant to Section 3.5 or Section 4.6(a)), located at the
address(es) set forth in Section 3.2 and shall keep its other places of business at the
addresses set forth in Section 3.2, or, upon 30 days’ prior written notice to the
Administrative Agent, at such other locations in a jurisdiction where all actions required by the
first sentence of Section 4.6 shall have been taken with respect to the Receivables
and such other Collateral; (ii) not change its name, corporate identity, jurisdiction of
organization or federal taxpayer identification number except upon 30 days’ prior written notice to
the Administrative Agent; (iii) hold and preserve such Records concerning the Receivables; and (iv)
permit representatives of the Administrative Agent, at reasonable times and intervals and upon
reasonable notice during normal business hours to inspect (and photocopy extracts from) such
Records.

     (b) Such Grantor shall have the right to collect, demand, receive, receipt for, sue for,
compound and give acquittances for any and all amounts due or to become due on Receivables and
settle and adjust disputes and claims with its customers and account debtors, handle returns and
recoveries and grant discounts, credits and allowances with respect to Receivables in the ordinary
course of business so long as no Event of Default shall have occurred and be continuing.

     (c) Except as otherwise provided in Section 7.2.19 of the Credit Agreement, all cash
kept by a Grantor in a Deposit Account shall be kept in a Deposit Account subject to an applicable
Control Agreement. All Proceeds of Collateral received by such Grantor shall be delivered in kind
for deposit to the applicable Controlled Deposit Account. Such Proceeds of Collateral received by
such Grantor shall, prior to deposit in the Controlled Deposit Account, be held (i) separate and
apart from, and not commingled with, any other property and (ii) in express trust for the benefit
of the Administrative Agent until delivery thereof is made to the applicable Controlled Deposit
Account.

     (d) The Administrative Agent shall have the right to apply any amount in any Controlled
Deposit Account and/or the Concentration Account as set forth in the Credit Agreement.

     (e) With respect to each Controlled Deposit Account and the Concentration Account, it is
hereby confirmed and agreed that (i) deposits in each such account are subject to a security
interest as contemplated hereby, (ii) each such account shall be under the sole dominion and
control of the Administrative Agent and (iii) the Administrative Agent shall have the sole right of
withdrawal over such Collateral, in each case subject to the provisions of the applicable Control
Agreement and the Credit Agreement.

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     (f) Such Grantor will not create any Chattel Paper without placing a legend on such Chattel
Paper acceptable to the Administrative Agent indicating that the Administrative Agent has a
security interest in such Chattel Paper.

     SECTION 4.4. As to Collateral. (a) Until the occurrence and continuance of an Event
of Default, and such time as the Administrative Agent shall notify such Grantor of the revocation
of such power and authority, such Grantor (i) may in the ordinary course of its business (except to
the extent prohibited under any Loan Document) at its own expense, refine, process, store,
transport, sell, lease or furnish under the contracts of service any of the Inventory normally held
by such Grantor for such purpose, and use and consume, in the ordinary course of its business
(except to the extent prohibited under the Credit Agreement or any other Loan Document), any raw
materials, including work in process or materials normally held by such Grantor for such purpose,
(ii) will, at its own expense, endeavor to collect, as and when due, all amounts due with respect
to any Collateral, including the taking of such action with respect to such collection as the
Administrative Agent may reasonably request upon the occurrence and during the continuance of an
Event of Default or, in the absence of such request, as such Grantor may deem advisable, (iii) may
grant, in the ordinary course of business (except to the extent prohibited under any Loan
Document), to any party obligated on any of the Collateral, any rebate, refund or allowance to
which such party may be lawfully entitled, and may accept, in connection therewith, the return of
Goods, the sale or lease of which shall have given rise to such Collateral, and (iv) may issue
licenses to third-parties with respect to Trademarks, Patents, Copyrights, and Trade Secrets in the
ordinary course of business. The Administrative Agent, however, may, at any time upon the
occurrence and during the continuance of an Event of Default, notify any parties obligated on any
of the Collateral to make payment to the Administrative Agent of any amounts due or to become due
thereunder and enforce collection of any of the Collateral by suit or otherwise and surrender,
release or exchange all or any part thereof, or compromise or extend or renew for any period
(whether or not longer than the original period) any indebtedness thereunder or evidenced thereby.
Upon request of the Administrative Agent, upon the occurrence and during the continuance of an
Event of Default, such Grantor will, at its own expense, notify any parties obligated on any of the
Collateral to make payment to the Administrative Agent of any amounts due or to become due
thereunder.

     (b) The Administrative Agent is authorized to endorse, in the name of such Grantor, any item,
howsoever received by the Administrative Agent, representing any payment on or other Proceeds of
any of the Collateral.

     SECTION 4.5. As to Intellectual Property Collateral. Each Grantor covenants and
agrees to comply with the following provisions as such provisions relate to any Intellectual
Property Collateral of such Grantor:

     (a) such Grantor will not (i) do any act, or omit to do any act, whereby any of the
Patent Collateral may lapse or become abandoned or dedicated to the public or unenforceable,
(ii) permit any of its licensees to, (A) fail to continue to use any of the Trademark
Collateral in order to maintain all of the Trademark Collateral in full force free from any
claim of abandonment for non-use, (B) fail to maintain as in the past the quality of
products and services offered under all of the Trademark Collateral, (C) fail to

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employ, consistent with past practice, all of the Trademark Collateral registered with
any Federal or State authority with an appropriate notice of such registration, (D) adopt or
use any other Trademark which is confusingly similar or a colorable imitation of any of the
Trademark Collateral unless such other Trademark is subject to the Administrative Agent’s
Lien hereunder, or (E) do or permit any act or knowingly omit to do any act whereby any of
the Trademark Collateral may lapse or become invalid or unenforceable, or (iii) do or permit
any act or knowingly omit to do any act whereby any of the Copyright Collateral or any of
the Trade Secrets Collateral may lapse or become invalid or unenforceable or placed in the
public domain except upon expiration of the end of an unrenewable term of a registration
thereof, unless, in any such case, such Grantor shall either (x) reasonably and in good
faith determine (and notice of such determination shall have been delivered to the
Administrative Agent) that any of the relevant Intellectual Property Collateral is not of
material economic value to such Grantor, or (y) in the exercise of its reasonable business
judgment determines to do otherwise;

     (b) such Grantor shall notify the Administrative Agent as soon as practicable if it
knows, or has reason to know, that any application or registration relating to any material
item of the Intellectual Property Collateral may become abandoned or dedicated to the public
or placed in the public domain or invalid or unenforceable other than upon the natural
expiration of protective periods under applicable law, or of any adverse determination or
development (including the institution of, or any such determination or development in, any
proceeding in the United States Patent and Trademark Office, the United States Copyright
Office or any U.S. court) regarding such Grantor’s ownership of any material item of the
Intellectual Property Collateral, its right to register the same or to keep and maintain and
enforce the same;

     (c) unless such Grantor shall otherwise determine in the exercise of its reasonable
business judgment, such Grantor will take all necessary steps, including in any proceeding
before the United States Patent and Trademark Office or the United States Copyright Office,
to maintain and pursue any application (and to obtain the relevant registration) filed with
respect to, and to maintain any registration of, any material item of the Intellectual
Property Collateral, including the filing of applications for renewal, affidavits of use,
affidavits of incontestability and opposition, interference and cancellation proceedings and
the payment of fees and Taxes (except to the extent that dedication, abandonment or
invalidation is permitted under the foregoing clauses (a) and (b)); and

     (e) such Grantor will, (i) as soon as practicable (and in any event within thirty (30)
days) after such Grantor obtains any material item of Intellectual Property Collateral that
is the subject of a registration or application in the United States Patent and Trademark
Office or in the United States Copyright Office, notify the Administrative Agent of the
acquisition of such Intellectual Property and, (ii) as soon as reasonably practicable after
any request by the Administrative Agent therefor (and in any event within ten (10) Business
Days of such request) execute and deliver to the Administrative Agent notice(s) to be filed
with the United States Patent and Trademark Office or United States Copyright Office, as
applicable, with respect to the security interest granted by this

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Agreement in such Intellectual Property Collateral, together with any other documents
as may be requested by the Administrative Agent and required to acknowledge or register or
perfect the Administrative Agent’s interest in any such item of Intellectual Property
Collateral, each of which notices and other documents shall be in form and substance
reasonably satisfactory to the Administrative Agent.

     SECTION 4.6. Further Assurances, etc. Such Grantor agrees that, from time to time at
its own expense, it will promptly execute and deliver all further instruments and documents, and
take all further action, that may be necessary or that the Administrative Agent may reasonably
request, in order to perfect, preserve and protect any security interest granted or purported to be
granted hereby or to enable the Administrative Agent to exercise and enforce its rights and
remedies hereunder with respect to any Collateral. Without limiting the generality of the
foregoing, such Grantor will:

     (a) if any Receivable (excluding any Receivable not included in calculating the
Borrowing Base Amount and with respect to which the payment owed to such Grantor does not
exceed $500,000) shall be evidenced by a promissory note or other Instrument, negotiable
document or Chattel Paper, deliver and pledge to the Administrative Agent hereunder such
promissory note, Instrument, negotiable document or Chattel Paper duly endorsed and
accompanied by duly executed instruments of transfer or assignment, all in form and
substance reasonably satisfactory to the Administrative Agent;

     (b) take such actions as are reasonably requested by the Administrative Agent in order
to allow the Administrative Agent to obtain control with respect to all Collateral
consisting of (i) Deposit Accounts, (ii) Investment Property, (iii) Letter-of-Credit Rights
and (iv) Electronic Chattel Paper;

     (c) authorize, execute (if necessary) and deliver to the Administrative Agent such
financing or continuation statements, or amendments thereto, and such other instruments or
notices (including any assignment of claim form under or pursuant to the federal assignment
of claims statute, 31 U.S.C. § 3726, any successor or amended version thereof or any
regulation promulgated under or pursuant to any version thereof), as may be necessary or
desirable, or as the Administrative Agent may reasonably request; and

     (d) furnish to the Administrative Agent, from time to time at the Administrative
Agent’s reasonable request, statements and schedules further identifying and describing the
Collateral and such other reports in connection with the Collateral as the Administrative
Agent may reasonably request, all in reasonable detail.

With respect to the foregoing and the grant of the security interest hereunder, such Grantor hereby
authorizes the Administrative Agent to file one or more financing or continuation statements, and
amendments thereto, relative to all or any part of the Collateral without the signature of such
Grantor where permitted by law. A carbon, photographic or other reproduction of this Agreement or
any financing statement covering the Collateral or any part thereof shall be sufficient as a
financing statement where permitted by law.

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     SECTION 4.7. Insurance. Each Grantor will:

     (a) maintain insurance on its property with financially sound and reputable insurance
companies against loss and damage in at least the amounts (and with only those deductibles)
customarily maintained, (and if insurance companies cease to offer such insurance generally
or with deductibles in the amounts customarily obtained by the Company, such insurance with
such deductibles as is acceptable to the Administrative Agent) and against such risks as are
typically insured against in the same general area, by Persons of comparable size engaged in
the same or similar business as the Grantor; and

     (b) maintain all worker’s compensation, employer’s liability insurance or similar
insurance as may be required under the laws of any state or jurisdiction in which it may be
engaged in business.

     SECTION 4.8. Commercial Tort Claims. If any Grantor obtains an interest in any
Commercial Tort Claim with a potential value in excess of $100,000, such Grantor shall within 30
days of obtaining such interest sign and deliver documentation reasonably acceptable to the
Administrative Agent granting and perfecting a security interest under the terms and provisions of
this Agreement in and to such Commercial Tort Claim.

ARTICLE V

THE ADMINISTRATIVE AGENT

     SECTION 5.1. Administrative Agent Appointed Attorney-in-Fact. Each Grantor hereby
irrevocably appoints the Administrative Agent as such Grantor’s attorney-in-fact, with full
authority in the place and stead of such Grantor and in the name of such Grantor or otherwise, from
time to time in the Administrative Agent’s discretion, upon the occurrence and during the
continuance of an Event of Default, to take any action and to execute any instrument which the
Administrative Agent may deem necessary or advisable to accomplish the purposes of this Agreement,
including, without limitation:

     (a) to ask, demand, collect, sue for, recover, compromise and receive and give
acquittance and receipts for moneys due and to become due under or in respect of any of the
Collateral;

     (b) to receive, endorse and collect any drafts or other Instruments, Documents and
Chattel Paper, in connection with clause (a) above;

     (c) to file any claims or take any action or institute any proceedings which the
Administrative Agent may deem necessary or desirable for the collection of any of the
Collateral or otherwise to enforce the rights of the Administrative Agent with respect to
any of the Collateral; and

     (d) to perform the affirmative obligations of such Grantor hereunder (including all
obligations of such Grantor pursuant to Section 4.6).

17

 

Such Grantor hereby acknowledges, consents and agrees that the power of attorney granted pursuant
to this Section is irrevocable and coupled with an interest.

     SECTION 5.2. Administrative Agent May Perform. If any Grantor fails to perform any
agreement contained herein, the Administrative Agent may itself perform, or cause performance of,
such agreement, and any expense of the Administrative Agent incurred in connection therewith shall
be payable by such Grantor pursuant to Section 6.3.

     SECTION 5.3. Administrative Agent Has No Duty. The powers conferred on the
Administrative Agent hereunder are solely to protect its interest (on behalf of the Secured
Parties) in the Collateral and shall not impose any duty on it to exercise any such powers. Except
for reasonable care of any Collateral in its possession and the accounting for moneys actually
received by it hereunder, the Administrative Agent shall have no duty as to any Collateral or
responsibility for:

     (a) ascertaining or taking action with respect to calls, conversions, exchanges,
maturities, tenders or other matters relative to any Investment Property, whether or not the
Administrative Agent has or is deemed to have knowledge of such matters; or

     (b) taking any necessary steps to preserve rights against prior parties or any other
rights pertaining to any Collateral.

     SECTION 5.4. Reasonable Care. The Administrative Agent agrees to use reasonable care
in the custody and preservation of any of the Collateral in its possession in accordance with
Section 9-207 of the U.C.C.; provided, that (a) the Administrative Agent shall be deemed to
have exercised reasonable care in the custody and preservation of any Collateral in its possession
if such Collateral is accorded treatment substantially similar to that which the Administrative
Agent accords its own property, and (b) it is understood that the Administrative Agent shall have
no responsibility for taking any necessary steps to preserve rights against prior parties with
respect to the Collateral.

ARTICLE VI

REMEDIES

     SECTION 6.1. Certain Remedies. If any Event of Default shall have occurred and be
continuing:

     (a) The Administrative Agent may exercise in respect of the Collateral, in addition to
other rights and remedies provided for herein or otherwise available to it, all the rights
and remedies of a secured party on default under the U.C.C. (whether or not the U.C.C.
applies to the affected Collateral) and also may

     (i) require each Grantor to, and such Grantor hereby agrees that it will, at
its expense and upon request of the Administrative Agent forthwith, assemble all or
part of the Collateral as directed by the Administrative Agent and make it

18

 

available to the Administrative Agent at a place to be designated by the
Administrative Agent which is reasonably convenient to both parties, and

     (ii) without notice except as specified below, sell the Collateral or any part
thereof in one or more parcels at public or private sale, at any of the
Administrative Agent’s offices or elsewhere, for cash, on credit or for future
delivery, and upon such other terms as the Administrative Agent may deem
commercially reasonable. Each Grantor agrees that, to the extent notice of sale
shall be required by law, at least ten days prior notice to such Grantor of the time
and place of any public sale or the time after which any private sale is to be made
shall constitute reasonable notification. The Administrative Agent shall not be
obligated to make any sale of such Collateral regardless of notice of sale having
been given. The Administrative Agent may adjourn any public or private sale from
time to time by announcement at the time and place fixed therefor, and such sale
may, without further notice, be made at the time and place to which it was so
adjourned.

     (b) All cash Proceeds received by the Administrative Agent in respect of any sale of,
collection from or other realization upon all or any part of the Collateral shall be applied
by the Administrative Agent as follows:

     (i) first, to the payment of any and all fees and expenses then due and owing
to the Administrative Agent (including, without limitation, any amounts payable to
the Administrative Agent pursuant to Section 10.3 of the Credit Agreement
and Section 6.3 of this Agreement);

     (ii) second, to the payment of any and all fees and expenses then due and
owing to the other Lenders in accordance with their respective Percentages;

     (iii) third, to the payment of all accrued and unpaid interest on Swing Line
Loans;

     (iv) fourth, to the payment of all accrued and unpaid interest on Revolving
Credit Loans, to each Lender in accordance with each Lender’s respective Percentage;

     (v) fifth, to reduce the outstanding principal amount of all Swing Line Loans
until all outstanding Swing Loans have been paid in full;

     (vi) sixth, to the payment to the Lenders, in accordance with their respective
Percentages, of all outstanding Revolving Credit Loans until all outstanding
Revolving Credit Loans have been paid in full;

     (vii) seventh, to reduce all unpaid and outstanding Reimbursement Obligations;

19

 

     (viii) eighth, to Cash Collateralize all Letters of Credit;

     (ix) ninth, to the ratable payment of all Banking Services Obligations and to
payment of any amounts owing with respect to Hedging Agreements;

     (x) tenth, to the ratable payment of all other unpaid and outstanding
Obligations, to each Secured Party in accordance with the proportion that the unpaid
and outstanding Obligations to such Secured Party bears to the unpaid and
outstanding Obligations to all Secured Parties; and

     (xi) eleventh, any remaining funds shall continue to be held by the
Administrative Agent to be held as additional collateral security and applied to any
outstanding Obligations in accordance with clauses (i)-(x) above until the
Termination Date, after which such remaining cash Proceeds shall be paid over to the
applicable Grantor or to whomsoever may be lawfully entitled to receive such
surplus.

     (c) The Administrative Agent may

     (i) transfer all or any part of the Collateral into the name of the
Administrative Agent or its nominee, with or without disclosing that such Collateral
is subject to the lien and security interest hereunder,

     (ii) notify the parties obligated on any of the Collateral to make payment to
the Administrative Agent of any amount due or to become due thereunder,

     (iii) enforce collection of any of the Collateral by suit or otherwise, and
surrender, release or exchange all or any part thereof, or compromise or extend or
renew for any period (whether or not longer than the original period) any
obligations of any nature of any party with respect thereto,

     (iv) endorse any checks, drafts or other writings in such Grantor’s name to
allow collection of the Collateral,

     (v) take control of any Proceeds of the Collateral and

     (vi) execute (in the name, place and stead of such Grantor) endorsements,
assignments, stock powers and other instruments of conveyance or transfer with
respect to all or any of the Collateral.

The Administrative Agent shall notify the applicable Grantor promptly after it exercises any
right or rights pursuant to this Section 6.1(c) with respect to Collateral of such
Grantor; provided, that any failure to provide such notice shall not in any way
prejudice any such exercise of any right or rights.

20

 

     SECTION 6.2. Compliance with Restrictions. Each Grantor agrees that in any sale of
any of the Collateral whenever an Event of Default shall have occurred and be continuing, the
Administrative Agent is hereby authorized to comply with any limitation or restriction in
connection with such sale as it may be advised by counsel is necessary in order to avoid any
violation of applicable law (including compliance with such procedures as may restrict the number
of prospective bidders and purchasers, require that such prospective bidders and purchasers have
certain qualifications and restrict such prospective bidders and purchasers to Persons who will
represent and agree that they are purchasing for their own account for investment and not with a
view to the distribution or resale of such Collateral) or in order to obtain any required approval
of the sale or of the purchaser by any Governmental Authority or official, and such Grantor further
agrees that such compliance shall not result in such sale being considered or deemed not to have
been made in a commercially reasonable manner, nor shall the Administrative Agent be liable nor
accountable to such Grantor for any discount allowed by the reason of the fact that such Collateral
is sold in compliance with any such limitation or restriction.

     SECTION 6.3. Indemnity and Expenses. Each Grantor hereby jointly and severally
indemnifies and holds harmless the Administrative Agent from and against any and all claims, losses
and liabilities arising out of or resulting from this Agreement (including enforcement of this
Agreement), except claims, losses or liabilities resulting from the Administrative Agent’s gross
negligence or willful misconduct and, each Grantor will, upon demand pay (without duplication) to
the Administrative Agent the amount of any and all reasonable out-of-pocket expenses, including the
reasonable fees and disbursements of its counsel and of any experts and agents, which the
Administrative Agent may incur, in each case, in connection with:

     (a) the administration of this Agreement;

     (b) the custody, preservation, use or operation of, or the sale of, collection from or
other realization upon, any of the Collateral;

     (c) the exercise or enforcement of any of the rights of the Administrative Agent
hereunder; or

     (d) the failure by any Grantor to perform or observe any of the provisions hereof.

ARTICLE VII

MISCELLANEOUS PROVISIONS

     SECTION 7.1. Loan Document. This Agreement is a Loan Document executed pursuant to
the Credit Agreement and shall (unless otherwise expressly indicated herein) be construed,
administered and applied in accordance with the terms and provisions thereof.

     SECTION 7.2. Amendments; etc. No amendment to or waiver of any provision of this
Agreement nor consent to any departure by any Grantor herefrom shall in any event be effective
unless the same shall be in writing and signed by the Administrative Agent (on behalf of the
Lenders or the Required Lenders, as the case may be) and each Grantor and then such waiver or

21

 

consent shall be effective only in the specific instance and for the specific purpose for
which given.

     SECTION 7.3. Protection of Collateral. The Administrative Agent may from time to
time, at its option, perform any act which each Grantor agrees hereunder to perform and which such
Grantor shall fail to perform after being requested in writing so to perform (it being understood
that no such request need be given after the occurrence and during the continuance of an Event of
Default) and the Administrative Agent may from time to time take any other action which the
Administrative Agent reasonably deems necessary for the maintenance, preservation or protection of
any of the Collateral or of its security interest therein.

     SECTION 7.4. Addresses for Notices. All notices and other communications provided
for hereunder shall be in writing and addressed, delivered or transmitted, if to any Grantor, at
the address or facsimile number of the Company provided for in the Credit Agreement, and, if to the
Administrative Agent, at the address or facsimile number provided for in the Credit Agreement, or
to any such party at such other address or facsimile number as shall be designated by such party in
a written notice to each other party complying as to delivery with the terms of this Section. Any
notice, (a) if mailed and properly addressed with postage prepaid or if properly addressed and sent
by pre-paid courier service, shall be deemed given when received, or (b) if transmitted by
facsimile or other electronic transmission, shall be deemed given when transmitted (and telephonic
or electronic confirmation of receipt thereof has been received, provided that if such confirmation
is electronic, it was generated by an affirmative action by or on behalf of the recipient of such
notice, as opposed to an automated E-Mail response).

     SECTION 7.5. Headings. The various headings of this Agreement are inserted for
convenience only, and shall not affect the meaning or interpretation of this Agreement or any
provisions thereof.

     SECTION 7.6. Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such provision and such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the remaining provisions
of this Agreement or affecting the validity or enforceability of such provision in any other
jurisdiction.

     SECTION 7.7. Counterparts; Effectiveness. This Agreement may be executed by the
parties hereto in several counterparts and by facsimile or other electronic transmission, each of
which counterparts shall be deemed to be an original (whether such counterpart is originally
executed or a facsimile or other electronic transmission copy of a counterpart that is originally
executed) and all of which shall constitute together but one and the same agreement. This
Agreement shall become effective as of the date first above written.

     SECTION 7.8. Governing Law. THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE
UNDER AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

22

 

     SECTION 7.9. Additional Grantors. Upon the execution and delivery by any other
Person of an instrument in the form of Annex I hereto, together with each Schedule thereto,
such Person shall become a “Grantor” hereunder with the same force and effect as if originally
named as a Grantor herein. The execution and delivery of any such instrument shall not require the
consent of any other Grantor hereunder. The rights and obligations of each Grantor hereunder shall
remain in full force and effect notwithstanding the addition of any new Grantor as a party to this
Agreement.

     SECTION 7.10. Restatement of Existing Security Agreement. The parties hereto agree
that, on the Closing Date: (a) the Obligations represent, among other things, the restatement,
renewal, amendment, extension, and modification of the “Obligations” as defined in the Existing
Credit Agreement and as secured by the Liens granted pursuant to the Existing Security Agreement;
(b) this Agreement is intended to, and does hereby, restate, renew, extend, amend, modify,
supersede, and replace the Existing Security Agreement in its entirety; (c) the promissory notes,
if any, executed pursuant to the Credit Agreement amend, renew, extend, modify, replace, restate,
substitute for, and supersede in their entirety (but do not extinguish the Indebtedness arising
under) the promissory notes issued pursuant to the Existing Credit Agreement; (d) the Security
Documents (including this Agreement) executed pursuant to the Credit Agreement amend, renew,
extend, modify, replace, restate, substitute for, and supersede in their entirety (but do not
extinguish or impair the collateral security created or evidenced by) the “Security Documents,”
executed and delivered pursuant to the Existing Credit Agreement; and (e) the entering into and
performance of their respective obligations under the Loan Documents and the transactions evidenced
hereby do not constitute a novation nor shall they be deemed to have terminated, extinguished, or
discharged the “Obligations” under the Existing Credit Agreement, and the “Security Documents,” or
the other “Loan Documents” (or the collateral security therefor) executed in connection with the
Existing Credit Agreement, all of which Indebtedness and Collateral shall continue under and be
governed by the Credit Agreement and the other Loan Documents, except as expressly provided
otherwise in the Credit Agreement.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

23

 

     IN WITNESS WHEREOF, each party hereto has caused this Amended and Restated Security Agreement
to be duly executed and delivered by its officer thereunto duly authorized as of the date first
above written.

	 	 	 	 	 	 	 
	 	 	GRANTORS:	 	 
	 
	 		 	 	 	 
	 	 	STERLING CHEMICALS, INC.	 	 
	 
	 
	 	By	 	 	 	 
	 

	 	
	 	 

Paul G. Vanderhoven
	 	 
	 

	 	 	 	Senior Vice President — Finance and	 	 
	 

	 	 	 	Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	 	 	STERLING CHEMICALS ENERGY, INC.	 	 
	 
	 
	 	By	 	 	 	 
	 

	 	
	 	 

Paul G. Vanderhoven
	 	 
	 

	 	 	 	Vice President	 	 

[Signature Page to Security Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	ADMINISTRATIVE AGENT:	 	 
	 
	 	 	 	 	 	 
	 	 	THE CIT GROUP/BUSINESS CREDIT, INC., as

     Administrative Agent, on behalf of the Secured

     Parties	 	 
	 
	 	 	 	 	 	 
	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Chad Ramsey
	 	 
	 

	 	 	 	Vice President	 	 

[Signature Page to Security Agreement]

 

 

SCHEDULE V

ANNEX I

to Security Agreement

SUPPLEMENT NO. ___ TO AMENDED AND RESTATED SECURITY AGREEMENT

     THIS SUPPLEMENT NO.                     , dated as of                                         ,                      (this “Supplement”), to the
Amended and Restated Security Agreement, dated as of March 29, 2007 (as amended, supplemented,
amended and restated or otherwise modified from time to time, the “Security Agreement’’),
among the initial signatories thereto and each other Person (such capitalized term and all other
capitalized terms being used herein with the meanings provided, or incorporated by reference, in
the Security Agreement) which from time to time thereafter became a party thereto pursuant to
Section 7.9 thereof (each such Person and each Borrower is individually referred to herein
as a “Grantor”, and collectively as the “Grantors”), and THE CIT GROUP/BUSINESS
CREDIT, INC., as Administrative Agent for each of the Secured Parties, is made by                                         ,
a                                          (the “Additional Grantor”).

RECITALS:

     A. Pursuant to an Amended and Restated Revolving Credit Agreement, dated as of March 29, 2007
(as amended, supplemented, amended and restated or otherwise modified from time to time, the
“Credit Agreement”), among Sterling Chemicals, Inc., a Delaware corporation, and Sterling
Chemicals Energy, Inc., a Delaware corporation (each individually a “Borrower” and
collectively the “Borrowers’’), the various financial institutions as are, or may from time
to time become, parties thereto (the “Lenders”) and the Administrative Agent, the Lenders
and the Issuer have extended Commitments to make Credit Extensions to the Borrowers.

     B. As a condition precedent to the making and maintenance of the Credit Extensions under the
Credit Agreement, the Additional Grantor is required to execute and deliver this Supplement.

     C. The Additional Grantor has duly authorized the execution, delivery and performance of this
Supplement and the Security Agreement.

     D. The Security Agreement provides that additional parties may become Grantors under the
Security Agreement by execution and delivery of an instrument in the form of this Supplement.

     E. Pursuant to the provisions of Section 7.9 of the Security Agreement, the Additional
Grantor is becoming a Grantor under the Security Agreement.

     F. The Additional Grantor desires to become a Grantor under the Security Agreement in order to
induce the Secured Parties to continue to make and maintain Revolving Credit Loans and Swing Line
Loans and issue and maintain Letters of Credit under the Credit Agreement as consideration
therefor.

Annex I to Security Agreement- Page 1

 

 

     NOW, THEREFORE, the Additional Grantor agrees, for the benefit of each Secured Party, as
follows:

     SECTION 1. In accordance with Section 7.9 of the Security Agreement, the Additional
Grantor by its signature below becomes a Grantor under the Security Agreement with the same force
and effect as if it were an original signatory thereto as a Grantor, and hereby grants to the
Administrative Agent, for the benefit of the Secured Parties, a security interest in, all of the
following property now owned or at any time hereafter acquired by the Additional Grantor or in
which the Additional Grantor now has or at any time in the future may acquire any right, title or
interest (the “Additional Collateral”) as collateral security for the prompt and complete
payment and performance when due (whether at the stated maturity, by acceleration or otherwise) of
the Obligations:

     (a) all Accounts and all books, other Records and Proceeds with respect thereto;

     (b) all Chattel Paper (including without limitation all Tangible Chattel Paper and
Electronic Chattel Paper) and all books, other Records and Proceeds with respect thereto;

     (c) [all Commercial Tort Claims described on Schedule I attached
hereto]1;

     (d) all Deposit Accounts, including without limitation each Controlled Deposit Account
(including all deposits and investments therein and all earnings thereon), and all books,
other Records and Proceeds with respect thereto, but excluding (x) the Escrow Account, and
(y) any Proceeds with respect to the Escrow Account;

     (e) all Documents and all books, other Records and Proceeds with respect thereto;

     (f) all General Intangibles (other than Excluded Contracts) and all books, other
Records and Proceeds with respect thereto;

     (g) all Inventory and all books, other Records and Proceeds with respect thereto;

     (h) all other Goods (including without limitation all Equipment but excluding the
Excluded Equipment) and all books, other Records and Proceeds with respect thereto;

     (i) all Instruments and all books, other Records and Proceeds with respect thereto;

     (j) all Intellectual Property Collateral and all books, other Records and Proceeds with
respect thereto;

 

			
	1	 	Item to be deleted if the Additional Grantor
does not have any Commercial Tort Claims.

Annex I to Security Agreement- Page 2

 

 

     (k) all Investment Property and all books, other Records and Proceeds with respect
thereto;

     (l) all Letter-of-Credit Rights and all books, other Records and Proceeds with respect
thereto;

     (m) all Receivables not otherwise described above and all books, other Records and
Proceeds with respect thereto; and

     (n) all Supporting Obligations and all books, other Records and Proceeds with respect
thereto.

     Notwithstanding the foregoing, the “Additional Collateral” shall not include (i) any
Proceeds (other than Capital Securities of a Borrower or a Restricted Subsidiary of a
Borrower) arising from a Disposition, casualty or condemnation of Excluded Equipment or
Excluded Contracts, (ii) any General Intangibles or other rights arising under any contract,
instrument, license or other document as to which the grant of a security interest would
constitute a violation of a valid and enforceable restriction on such grant in favor of the
Person(s) (other than the Additional Grantor) obligated on such contract, instrument,
license or other document, unless and until any required consents shall have been obtained,
or (iii) any Excluded Equity. The Additional Grantor agrees to use commercially reasonable
efforts to obtain any such required consent with respect to any material item described in
clause (ii) of the immediately preceding sentence.

In furtherance of the foregoing, each reference to a “Grantor” in the Security Agreement shall be
deemed to include the Additional Grantor, each reference to “Collateral” in the Security Agreement
shall be deemed to include the Additional Collateral, and each Schedule hereto shall be deemed to
be included in the Schedules thereto.

     SECTION 2. The Additional Grantor hereby represents and warrants that (i) this Supplement has
been duly authorized, executed and delivered by the Additional Grantor and constitutes a legal,
valid and binding obligation of the Additional Grantor, enforceable against it in accordance with
its terms, except as such enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors’ rights generally and general
equitable principles, (ii) each Schedule attached hereto contains true, correct and complete
information with respect to the matters set forth therein, and (iii) all representations and
warranties set forth in Article III of the Security Agreement, as supplemented hereby to
incorporate each Schedule hereto, are true and correct in all respects as to the Additional
Grantor.

     SECTION 3. Except as expressly supplemented hereby, the Security Agreement shall remain in
full force and effect in accordance with its terms.

     SECTION 4. Any provision of this Supplement which is prohibited or unenforceable in any
jurisdiction shall, as to such provision and such jurisdiction, be ineffective to the extent of

Annex I to Security Agreement- Page 3

 

 

such prohibition or unenforceability without invalidating the remaining provisions of this
Supplement or affecting the validity or enforceability of such provision in any other jurisdiction.

     SECTION 5. Without limiting the provisions of the Credit Agreement (or any other Loan
Document, including the Security Agreement), the Additional Grantor agrees to reimburse the
Administrative Agent for its reasonable out-of-pocket expenses in connection with this Supplement,
including reasonable attorneys’ fees and expenses of the Administrative Agent.

     SECTION 6. THIS SUPPLEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE
LAWS OF THE STATE OF NEW YORK.

     SECTION 7. This Supplement hereby incorporates by reference the provisions of the Security
Agreement, which provisions are deemed to be a part hereof, and this Supplement shall be deemed to
be a part of the Security Agreement.

     SECTION 8. This Supplement may be executed in several counterparts and by facsimile or other
electronic transmission, each of which shall be deemed to be an original (whether such counterpart
is originally executed or a facsimile or other electronic transmission copy of a counterpart that
is originally executed) and all of which shall constitute together but one and the same agreement.
This Supplement shall become effective and binding as of the date first above written when a
counterpart hereof executed on behalf of the Additional Grantor shall have been received by the
Administrative Agent.

     IN WITNESS WHEREOF, the Additional Grantor has caused this Supplement to be duly executed and
delivered by its officer thereunto duly authorized as of the date first above written.

	 	 	 	 	 	 	 
	 	 	[NAME OF ADDITIONAL GRANTOR]	 	 
	 
	 
	 	By	 	 	 	 
	 

	 	
	 	 

Name:

Title:
	 	 

ACKNOWLEDGED AND ACCEPTED BY:

THE CIT GROUP/BUSINESS CREDIT, INC.

as Administrative Agent, on behalf of the

Secured Parties

	By	 	 	 	 
	

	 	 

Name:

Title:
	 	 

Annex I to Security Agreement- Page 4

 

 

SCHEDULE I

to Supplement No. __

to Security Agreement

([NAME OF ADDITIONAL GRANTOR])

Commercial Tort Claims2

 

			
	2	 	Schedule I to be deleted if the Additional
Grantor does not have any Commercial Tort Claims

 

 

SCHEDULE [I][II]

to Supplement No. __

to Security Agreement

([NAME OF ADDITIONAL GRANTOR])

Perfection Certificate Information for Additional Grantor

     1. Names and Business Qualifications. (a) The exact name (as such name appears in the
certificate of incorporation or similar organizational document of the Additional Grantor),
jurisdiction of organization, and organizational identification number of the Additional Grantor,
and each jurisdiction in which the Additional Grantor is qualified to conduct business as a foreign
entity, are as follows:

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Jurisdictions Where	 
	 	 	 	 	 	 	Organizational	 	 	Qualified to Transact	 
	 	 	Jurisdiction of	 	 	Identification	 	 	Business as a Foreign	 
	Name	 	Incorporation	 	 	Number	 	 	Corporation	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 

          (b) Set forth below is each other name that the Additional Grantor has had since its
organization, together with the date of the relevant change:

          (c) Except as set forth below, the Additional Grantor has not changed its identity or
organizational structure in any way within the past five years.

          (d) The following is a list of all other names (including trade names or similar appellations)
used by the Additional Grantor or any of its divisions or other business units at any time during
the past five years:

     2. Taxpayer Identification Numbers. The exact taxpayer identification number of the
Additional Grantor is as follows:

     3. Current Locations. (a) The chief executive office of the Additional Grantor is
located at the following address:

          (b) The following are all locations where the Additional Grantor maintains any chattel paper
or any books or records relating to any accounts receivable:

 

 

          (c) The following are all locations where the Additional Grantor maintains any Controlled
Deposit Account, deposit account, securities account or other bank account:

          (d) The following is a list of all real property owned or leased by the Additional Grantor
(identify: the complete address and county of all such real property; whether such property is
owned or leased; if such property is leased, the name and complete address of the lessor of such
property; the use and approximate value of such property):

 

 

          (e) The following are all the locations (including the addresses) where the Additional Grantor
maintains any equipment or inventory not identified above (identify the approximate value
of any such equipment or inventory and the nature of such location):

          (f) The following are the names and addresses of all Persons other than the Additional Grantor
which have possession of any of the Additional Grantor’s equipment:

          (g) The following are the names and addresses of all Persons other than the Additional Grantor
which have possession of the Additional Grantor’s inventory (explain relationship of such Persons
to a Borrower, e.g., consignee, etc.):

          4. Intentionally Omitted.

          5. Consigned Inventory. Approximate dollar amount of the Additional Grantor’s
inventory consigned to third parties at any time: $                    .

          6. Inventory Located Outside of U.S. Approximate dollar amount of the Additional
Grantor’s inventory located outside of the United States at any time: $                    .

          7. Method of Shipment of Inventory. List the methods by which the Additional
Grantor’s inventory is shipped to customers (e.g., common carrier, by company owned
vehicles, company owned railroad cars, etc.).

          8. Unusual Transactions. The Additional Grantor’s receivables have been originated by
the Additional Grantor and the Additional Grantor’s inventory has been acquired by the Additional
Grantor in the ordinary course of its business.

          9. Government Contracts. The Additional Grantor is a party to the following Federal,
State or local government contracts:

          10. Patents. Below is a list of each patent and patent application in which the
Additional Grantor has any interest (whether as owner, licensee or otherwise):

          (a) Nature of interest (e.g., owner, licensee, other);

          (b) Description;

          (c) Registration number;

          (d) Issue date (patent) or date of application (patent application); and

          (e) Country of issuance (patent) or country of application (patent application).

 

 

          11. Trademarks. Below is a list of each registered trademark and trademark
application in which the Additional Grantor has any interest (whether as owner, licensee or
otherwise):

     Registered Trademarks:

          (a) Nature of interest (e.g., owner, licensee, other);

          (b) Registered trademark;

          (c) Registered number;

          (d) Property covered;

          (e) Date of registration;

          (f) Country of registration;

     Trademark Applications:

          (a) Nature of interest (e.g., owner, licensee, other);

          (b) Trademark to which application applies;

          (c) Property covered;

          (d) Date of application; and

          (e) Country of application.

          12. Copyrights. Below is a list of each copyright and copyright application in which
the Additional Grantor has any interest (whether as owner, license or otherwise):

     Copyrights:

          (a) Nature of interest (e.g., owner, licensee, other);

          (b) Copyright;

          (c) Copyright number;

          (d) Property covered;

          (e) Date of copyright;

          (f) Docket number; and

 

 

           (g) Country of registration.

     Copyright Applications:

          (a) Nature of interest (e.g., owner, licensee, other);

          (b) Copyright to which application applies;

          (c) Property covered;

          (d) Date of application; and

          (e) Country of application.

          13. Investment Property. Below is a list of all securities (whether or not evidenced
by a certificate), instruments and other investment property which are in the name of or
beneficially owned by the Additional Grantor (identify the issuer and nature of investment
property).

          14. Material Contract Rights. Below is a list of all other contract rights,
franchises and licenses (other than the real property leases listed above) the cancellation or
termination of which could be reasonably expected to have a material adverse effect on (a) the
business, condition (financial or otherwise), operations, performance, properties, or prospects of
the Additional Grantor, (b) the rights and remedies of any Secured Party under any Loan Document to
which the Additional Grantor is a party, or (c) the ability of the Additional Grantor to perform
its obligations under the Loan Documents.

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