Document:

Execution
Copy

$275,000,000

TRANSDIGM
INC.

73⁄4% Senior
Subordinated Notes

REGISTRATION
RIGHTS AGREEMENT

June 23, 2006

BANC OF AMERICA SECURITIES LLC (“Banc of America”)

CREDIT SUISSE SECURITIES (USA) LLC (“Credit Suisse”)
   As representatives of the
several initial purchasers

c/o Banc of America
Securities LLC

Nine West 57th Street

New York, N.Y. 10019

and

c/o Credit Suisse
Securities (USA) LLC

Eleven Madison Avenue,

New York, N.Y. 10010-3629

Dear Sirs:

TransDigm
Inc., a Delaware corporation (the “Issuer”), proposes to issue and sell to the
several initial purchasers 
(collectively, the “Initial Purchasers”) listed on Schedule A to
a purchase agreement, dated as of June 20, 2006 (the “Purchase Agreement”),
upon the terms set forth in such Purchase Agreement, $275,000,000 aggregate
principal amount of its 73⁄4% Senior Subordinated Notes (the “Initial Securities”)
to be unconditionally guaranteed (the “Guarantees”) by  TransDigm Group Incorporated and the
subsidiaries of the Issuer listed on Schedule I hereto (such subsidiaries and
TransDigm Group Incorporated are hereinafter collectively referred to as the “Guarantors,”
and the Guarantors together with the Issuer are hereinafter collectively
referred to as the “Company”). The Initial Securities will be issued pursuant
to an Indenture, dated as of the date hereof (the “Indenture”), among the
Issuer, the Guarantors and The Bank of New York Trust Company, N.A., a national
banking association, as trustee (the “Trustee”). As an inducement to the
Initial Purchasers, the Company agrees 

 

with the Initial Purchasers, for the benefit of the
holders of the Initial Securities (including, without limitation, the Initial
Purchasers), the Exchange Securities (as defined below) and the Private
Exchange Securities (as defined below) (collectively the “Holders”), as
follows:

1. Registered Exchange Offer. The Company shall, at its own
cost, prepare and, not later than 180 days (or if the 180th day is not a
business day, the first business day thereafter) after the date of original issue
of the Initial Securities (the “Issue Date”), file with the Securities and
Exchange Commission (the “Commission”) a registration statement (the “Exchange
Offer Registration Statement”) on an appropriate form under the Securities Act
of 1933, as amended (the “Securities Act”), with respect to a proposed offer
(the “Registered Exchange Offer”) to the Holders of Transfer Restricted
Securities (as defined in Section 6(d) hereof), who are not
prohibited by any law or policy of the Commission from participating in the
Registered Exchange Offer, to issue and deliver to such Holders, in exchange
for the Initial Securities, an equal aggregate principal amount of debt
securities (the “Exchange Securities”) of the Issuer issued under the Indenture
and identical in all material respects to the Initial Securities (except for
the transfer restrictions relating to the Initial Securities and the provisions
relating to the matters described in Section 6 hereof) that would be
registered under the Securities Act. The Company shall use its reasonable best
efforts to cause such Exchange Offer Registration Statement to become effective
under the Securities Act within 270 days (or if the 270th day is not a business
day, the first business day thereafter) after the Issue Date and shall keep the
Exchange Offer Registration Statement effective for not less than 30 days (or
longer, if required by applicable law) after the date notice of the Registered
Exchange Offer is mailed to the Holders (such period being called the “Exchange
Offer Registration Period”).

If
the Company effects the Registered Exchange Offer, the Company will be entitled
to close the Registered Exchange Offer 30 days after the commencement thereof
provided that the Company has accepted all the Initial Securities theretofore
validly tendered in accordance with the terms of the Registered Exchange Offer.

As
soon as practicable after the declaration of the effectiveness of the Exchange
Offer Registration Statement, the Company shall commence the Registered
Exchange Offer, it being the objective of such Registered Exchange Offer to
enable each Holder of Transfer Restricted Securities (as defined in Section 6(d) hereof)
electing to exchange the Initial Securities for Exchange Securities (assuming
that such Holder is not an affiliate of the Company within the meaning of the
Securities Act, acquires the Exchange Securities in the ordinary course of such
Holder’s business and has no arrangements with any person to participate in the
distribution of the Exchange Securities and is not prohibited by any law or
policy of the Commission from participating in the Registered Exchange Offer)
to trade such Exchange Securities from and after their receipt without any
limitations or restrictions under the Securities Act and without material
restrictions under the securities laws of the several states of the United
States.

 2
 

 

The
Company acknowledges that, pursuant to current interpretations by the
Commission’s staff of Section 5 of the Securities Act, in the absence of
an applicable exemption therefrom, (i) each Holder which is a
broker-dealer electing to exchange Initial Securities, acquired for its own
account as a result of market making activities or other trading activities,
for Exchange Securities (an “Exchanging Dealer”), is required to deliver a
prospectus containing the information set forth in (a) Annex A hereto on
the cover, (b) Annex B hereto in the “Exchange Offer Procedures” section
and the “Purpose of the Exchange Offer” section, and (c) Annex C hereto in
the “Plan of Distribution” section of such prospectus in connection with a sale
of any such Exchange Securities received by such Exchanging Dealer pursuant to
the Registered Exchange Offer and (ii) an Initial Purchaser that elects to
sell Exchange Securities acquired in exchange for Initial Securities
constituting any portion of an unsold allotment is required to deliver a
prospectus containing the information required by Items 507 or 508 of
Regulation S-K under the Securities Act, as applicable, in connection with such
sale.

The
Company shall use its reasonable best efforts to keep the Exchange Offer
Registration Statement effective and to amend and supplement the prospectus
contained therein, in order to permit such prospectus to be lawfully delivered
by all persons subject to the prospectus delivery requirements of the
Securities Act for such period of time as such persons must comply with such
requirements in order to resell the Exchange Securities; provided, however,
that (i) in the case where such prospectus and any amendment or supplement
thereto must be delivered by an Exchanging Dealer or an Initial Purchaser, such
period shall be the lesser of 180 days and the date on which all Exchanging
Dealers and the Initial Purchasers have sold all Exchange Securities held by
them (unless such period is extended pursuant to Section 3(j) below)
and (ii) the Company shall make such prospectus and any amendment or
supplement thereto, available to any broker-dealer for use in connection with
any resale of any Exchange Securities for a period of not less than 180 days
after the consummation of the Registered Exchange Offer.

If,
upon consummation of the Registered Exchange Offer, any Initial Purchaser holds
Initial Securities acquired by it as part of its initial distribution, the
Company, simultaneously with the delivery of the Exchange Securities pursuant
to the Registered Exchange Offer, shall issue and deliver to such Initial
Purchaser upon the written request of such Initial Purchaser, in exchange (the “Private
Exchange”) for the Initial Securities held by such Initial Purchaser, an equal
principal amount of debt securities of the Company issued under the Indenture
and identical in all material respects (including the existence of restrictions
on transfer under the Securities Act and the securities laws of the several
states of the United States, but excluding provisions relating to the matters
described in Section 6 hereof) to the Initial Securities (the “Private
Exchange Securities”). The Initial Securities, the Exchange Securities and the
Private Exchange Securities are herein collectively called the “Securities”.

 3
 

 

In
connection with the Registered Exchange Offer, the Company shall:

(a)  mail, or
cause to be mailed, to each Holder a copy of the prospectus forming part of the
Exchange Offer Registration Statement, together with an appropriate letter of
transmittal and related documents;

(b)  keep the
Registered Exchange Offer open for not less than 30 days (or longer, if
required by applicable law) after the date notice thereof is mailed to the
Holders;

(c)  utilize
the services of a depositary for the Registered Exchange Offer with an address
in the Borough of Manhattan, The City of New York, which may be the Trustee or
an affiliate of the Trustee;

(d)  permit
Holders to withdraw tendered Securities at any time prior to the close of
business, New York time, on the last business day on which the Registered
Exchange Offer shall remain open; and

(e)  otherwise
comply in all material respects with all applicable laws.

As
soon as practicable after the close of the Registered Exchange Offer or the
Private Exchange, as the case may be, the Company shall:

(x)  accept for
exchange all the Securities validly tendered and not withdrawn pursuant to the
Registered Exchange Offer and the Private Exchange;

(y)  deliver to
the Trustee for cancellation all the Initial Securities so accepted for
exchange; and

(z)  cause the
Trustee to authenticate and deliver promptly to each Holder of the Initial
Securities, Exchange Securities or Private Exchange Securities, as the case may
be, equal in principal amount to the Initial Securities of such Holder so
accepted for exchange.

The
Indenture will provide that the Exchange Securities will not be subject to the
transfer restrictions set forth in the Indenture and that all the Securities
will vote and consent together on all matters as one class and that none of the
Securities will have the right to vote or consent as a class separate from one
another on any matter.

 

 4

 

Interest
on each Exchange Security and Private Exchange Security issued pursuant to the
Registered Exchange Offer and in the Private Exchange will accrue from the last
interest payment date on which interest was paid on the Initial Securities
surrendered in exchange therefor or, if no interest has been paid on the
Initial Securities, from the date of original issue of the Initial Securities.

Each
Holder participating in the Registered Exchange Offer shall be required to
represent to the Company, that at the time of the consummation of the
Registered Exchange Offer (i) any Exchange Securities received by such
Holder will be acquired in the ordinary course of business, (ii) such
Holder will have no arrangements or understanding with any person to participate
in the distribution of the Securities or the Exchange Securities within the
meaning of the Securities Act, (iii) such Holder is not an “affiliate,” as
defined in Rule 405 of the Securities Act, of the Company or if it is an
affiliate, such Holder will comply with the registration and prospectus
delivery requirements of the Securities Act to the extent applicable,
(iv) if such Holder is not a broker-dealer, that it is not engaged in, and
does not intend to engage in, the distribution of the Exchange Securities and
(v) if such Holder is a broker-dealer, that it will receive Exchange
Securities for its own account in exchange for Initial Securities that were
acquired as a result of market-making activities or other trading activities
and that it will be required to acknowledge that it will deliver a prospectus
in connection with any resale of such Exchange Securities.

Notwithstanding
any other provisions hereof, the Company will ensure that (i) any Exchange
Offer Registration Statement and any amendment thereto and any prospectus
forming part thereof and any supplement thereto complies in all material
respects with the Securities Act and the rules and regulations thereunder,
(ii) any Exchange Offer Registration Statement and any amendment thereto
does not, when it becomes effective, contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and (iii) any
prospectus forming part of any Exchange Offer Registration Statement, and any
supplement to such prospectus, does not include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading.

2. Shelf Registration. If, (i) because of any change in
law or in applicable interpretations thereof by the staff of the Commission,
the Company is not permitted to effect a Registered Exchange Offer, as contemplated
by Section 1 hereof, (ii) the Registered Exchange Offer is not
consummated within 310 days of the Issue Date, (iii) any Initial Purchaser
so requests with respect to the Initial Securities (or the Private Exchange
Securities) not eligible to be exchanged for Exchange Securities in the
Registered Exchange Offer and held by it following consummation of the
Registered 

 5
 

 

Exchange Offer or (iv) any Holder (other than an
Exchanging Dealer) is not eligible to participate in the Registered Exchange
Offer or, in the case of any Holder (other than an Exchanging Dealer) that
participates in the Registered Exchange Offer, such Holder does not receive
freely tradeable Exchange Securities on the date of the exchange and any such
Holder so requests, the Company shall take the following actions:

(a)  The
Company shall, at its cost, as promptly as practicable (but in no event more
than 60 days after so required or requested pursuant to this Section 2)
file with the Commission and thereafter shall use its reasonable best efforts
to cause to be declared effective (unless it becomes effective automatically
upon filing) a registration statement (the “Shelf Registration Statement” and,
together with the Exchange Offer Registration Statement, a “Registration
Statement”) on an appropriate form under the Securities Act relating to the
offer and sale of the Transfer Restricted Securities (as defined in Section 6(d) hereof)
by the Holders thereof from time to time in accordance with the methods of
distribution set forth in the Shelf Registration Statement and Rule 415
under the Securities Act (hereinafter, the “Shelf Registration”), it being
agreed that in the case the Company is filing a Shelf Registration Statement
due to (x) the occurrence of the events specified in clause (i) of
this Section 2, the Company shall use its reasonable best efforts to have
such Shelf Registration Statement declared effective on or prior to the 270th
day after the Issue Date or (y) the occurrence of the events specified in
clause (ii), (iii) or (iv) of this Section 2, the Company shall
use its reasonable best efforts to have such Shelf Registration Statement
declared effective on or prior to the 60th day after the date on which the
Shelf Registration Statement is required to be filed; provided, however, that
no Holder (other than an Initial Purchaser) shall be entitled to have the
Securities held by it covered by such Shelf Registration Statement unless such
Holder agrees in writing to be bound by all the provisions of this Agreement
applicable to such Holder.

(b)  The
Company shall use its reasonable best efforts to keep the Shelf Registration
Statement continuously effective in order to permit the prospectus included
therein to be lawfully delivered by the Holders of the relevant Securities, for
a period of two years (or for such longer period if extended pursuant to Section 3(j) below)
from the Issue Date or such shorter period that will terminate when all the
Securities covered by the Shelf Registration Statement (i) have been sold
pursuant thereto or (ii) are no longer restricted securities (as defined
in Rule 144 under the Securities Act, or any successor rule thereof).
The Company shall be deemed not to have used its reasonable best efforts to
keep the Shelf Registration Statement effective during the requisite period if
it voluntarily takes any action that would result in Holders of Securities
covered thereby not being able to offer and sell such Securities during that
period, unless such action is required by applicable law.

 6
 

 

(c)  Notwithstanding
any other provisions of this Agreement to the contrary, the Company shall cause
the Shelf Registration Statement and the related prospectus and any amendment
or supplement thereto, as of the effective date of the Shelf Registration
Statement, amendment or supplement, (i) to comply in all material respects
with the applicable requirements of the Securities Act and the rules and
regulations of the Commission and (ii) not to contain any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.

3. Registration Procedures. In connection with any Shelf
Registration contemplated by Section 2 hereof and, to the extent
applicable, any Registered Exchange Offer contemplated by Section 1
hereof, the following provisions shall apply:

(a)  The
Company shall (i) furnish to each Initial Purchaser, prior to the filing
thereof with the Commission, a copy of the Registration Statement and each
amendment thereof and each supplement, if any, to the prospectus included
therein and, in the event that an Initial Purchaser (with respect to any
portion of an unsold allotment from the original offering) is participating in
the Registered Exchange Offer or the Shelf Registration Statement, the Company
shall use its best efforts to reflect in each such document, when so filed with
the Commission, such comments as such Initial Purchaser reasonably may propose;
(ii) include the information set forth in Annex A hereto on the cover, in
Annex B hereto in the “Exchange Offer Procedures” section and the “Purpose of
the Exchange Offer” section and in Annex C hereto in the “Plan of Distribution”
section of the prospectus forming a part of the Exchange Offer Registration
Statement and include the information set forth in Annex D hereto in the Letter
of Transmittal delivered pursuant to the Registered Exchange Offer; (iii) if
requested by an Initial Purchaser, include the information required by Items
507 or 508 of Regulation S-K under the Securities Act, as applicable, in the
prospectus forming a part of the Exchange Offer Registration Statement; (iv) include
within the prospectus contained in the Exchange Offer Registration Statement a
section entitled “Plan of Distribution,” reasonably acceptable to the Initial
Purchasers, which shall contain a summary statement of the positions taken or
policies made by the staff of the Commission with respect to the potential “underwriter”
status of any broker-dealer that is the beneficial owner (as defined in Rule 13d-3
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of
Exchange Securities received by such broker-dealer in the Registered Exchange
Offer (a “Participating Broker-Dealer”), whether such positions or policies
have been publicly disseminated by the staff of the Commission or such
positions or policies, in the reasonable judgment of the Initial Purchasers
based upon advice of 

 7
 

 

counsel (which may be in-house counsel), represent the
prevailing views of the staff of the Commission; and (v) in the case of a
Shelf Registration Statement, include in the prospectus included in the Shelf
Registration Statement (or, if permitted by Commission Rule 430B(b), in a
prospectus supplement that becomes a part thereof pursuant to Commission Rule 430B(f))
that is delivered to any Holder pursuant to Section 3(d) and (f),
the names of the Holders, who propose to sell Securities pursuant to the Shelf
Registration Statement, as selling securityholders.

(b)  The
Company shall give written notice to the Initial Purchasers, the Holders of the
Securities and any Participating Broker-Dealer from whom the Company has
received prior written notice that it will be a Participating Broker-Dealer in
the Registered Exchange Offer (which notice pursuant to clauses (ii)-(v) hereof
shall be accompanied by an instruction to suspend the use of the prospectus
until the requisite changes have been made):

(i)  when the
Registration Statement or any amendment thereto has been filed with the
Commission and when the Registration Statement or any post-effective amendment
thereto has become effective;

(ii)  of any
request by the Commission for amendments or supplements to the Registration
Statement or the prospectus included therein or for additional information;

(iii)  of the
issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement or the initiation of any proceedings for that
purpose, of the issuance by the Commission of a notification of objection to
the use of the form on which the Registration Statement has been filed, and of
the happening of any event that causes the Company to become an “ineligible
issuer,” as defined in Commission Rule 405.

(iv)  of the
receipt by the Company or its legal counsel of any notification with respect to
the suspension of the qualification of the Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose; and

(v)  of the
happening of any event that requires the Company to make changes in the
Registration Statement or the prospectus in order that the Registration
Statement or the prospectus do not contain an untrue statement of a material
fact nor omit to state a material fact required to be stated therein or
necessary to make the statements therein (in the case of 

 8
 

 

the prospectus, in light of the circumstances under
which they were made) not misleading.

(c)  The
Company shall make every reasonable effort to obtain the withdrawal at the
earliest possible time, of any order suspending the effectiveness of the
Registration Statement.

(d)  The
Company shall furnish to each Holder of Securities included within the coverage
of the Shelf Registration, without charge, at least one copy of the Shelf
Registration Statement and any post-effective amendment or supplement thereto,
including financial statements and schedules, and, if the Holder so requests in
writing, all exhibits thereto (including those, if any, incorporated by
reference). The Company shall not, without the prior consent of the Initial
Purchasers, make any offer relating to the Securities that would constitute a “free
writing prospectus,” as defined in Commission Rule 405.

(e)  The
Company shall deliver to each Exchanging Dealer and each Initial Purchaser, and
to any other Holder who so requests in writing, without charge, at least one
copy of the Exchange Offer Registration Statement and any post-effective
amendment thereto, including financial statements and schedules, and, if any
Initial Purchaser or any such Holder so requests, all exhibits thereto
(including those incorporated by reference).

(f)  The
Company shall, during the Shelf Registration Period, deliver to each Holder of
Securities included within the coverage of the Shelf Registration, without
charge, as many copies of the prospectus (including each preliminary
prospectus) included in the Shelf Registration Statement and any amendment or
supplement thereto as such person may reasonably request in writing. The
Company consents, subject to the provisions of this Agreement, to the use of
the prospectus or any amendment or supplement thereto by each of the selling
Holders of the Securities in connection with the offering and sale of the
Securities covered by the prospectus, or any amendment or supplement thereto,
included in the Shelf Registration Statement.

(g)  The
Company shall deliver to each Initial Purchaser, any Exchanging Dealer, any
Participating Broker-Dealer and such other persons required to deliver a
prospectus following the Registered Exchange Offer, without charge, as many
copies of the final prospectus included in the Exchange Offer Registration
Statement and any amendment or supplement thereto as such persons may
reasonably request. The Company consents, subject to the provisions of this
Agreement, to the use of the prospectus or any amendment or supplement thereto
by any Initial Purchaser, if necessary, any Participating Broker-Dealer and
such 

 9
 

 

other persons required to deliver a prospectus
following the Registered Exchange Offer in connection with the offering and
sale of the Exchange Securities covered by the prospectus, or any amendment or
supplement thereto, included in such Exchange Offer Registration Statement.

(h)  Prior to
any public offering of the Securities, pursuant to any Registration Statement,
the Company shall register or qualify or cooperate with the Holders of the
Securities included therein and their respective counsel in connection with the
registration or qualification of the Securities for offer and sale under the
securities or “blue sky” laws of such states of the United States as any Holder
of the Securities reasonably requests in writing and do any and all other acts
or things reasonably necessary or advisable to enable the offer and sale in
such jurisdictions of the Securities covered by such Registration Statement;
provided, however, that the Company shall not be required to file any general
consent to service of process or to qualify as a foreign corporation or as a
dealer in securities in any jurisdiction in which it is not so qualified as of
the date hereof or to subject itself to taxation in respect of doing business
in any jurisdiction in which it is not otherwise subject as of the date
hereof..

(i)  The
Company shall cooperate with the Holders of the Securities to facilitate the
timely preparation and delivery of certificates representing the Securities to
be sold pursuant to any Registration Statement free of any restrictive legends
and in such denominations and registered in such names as the Holders may
request a reasonable period of time prior to sales of the Securities pursuant
to such Registration Statement.

(j)  Upon the
occurrence of any event contemplated by paragraphs (ii) through (v) of
Section 3(b) above during the period for which the Company is
required to maintain an effective Registration Statement, the Company shall
promptly prepare and file a post-effective amendment to the Registration
Statement or a supplement to the related prospectus and any other required
document so that, as thereafter delivered to Holders of the Securities or
purchasers of Securities, the prospectus will not contain an untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. If the Company
notifies the Initial Purchasers, the Holders of the Securities and any known
Participating Broker-Dealer in accordance with paragraphs (ii) through (v) of
Section 3(b) above to suspend the use of the prospectus until the
requisite changes to the prospectus have been made, then the Initial
Purchasers, the Holders of the Securities and any such Participating
Broker-Dealers shall suspend use of such prospectus, and the period of
effectiveness of the Shelf Registration Statement provided for in Section

 10
 

 

2(b) above and the Exchange Offer Registration
Statement provided for in Section 1 above shall each be extended by the
number of days from and including the date of the giving of such notice to and
including the date when the Initial Purchasers, the Holders of the Securities
and any known Participating Broker-Dealer shall have received such amended or
supplemented prospectus pursuant to this Section 3(j). During the period
during which the Company is required to maintain an effective Shelf
Registration Statement pursuant to this Agreement, the Company will prior to
the three-year expiration of that Shelf Registration Statement file, and
use its reasonable best efforts to cause to be declared effective (unless it
becomes effective automatically upon filing) within a period that avoids any
interruption in the ability of Holders of Securities covered by the expiring
Shelf Registration Statement to make registered dispositions, a new
registration statement relating to the Securities, which shall be deemed the “Shelf
Registration Statement” for purposes of this Agreement.

(k)  Not later
than the effective date of the applicable Registration Statement, the Company
will provide a CUSIP number for the Initial Securities, the Exchange Securities
or the Private Exchange Securities, as the case may be, and provide the
applicable trustee with printed certificates for the Initial Securities, the
Exchange Securities or the Private Exchange Securities, as the case may be, in
a form eligible for deposit with The Depository Trust Company.

(l)  The
Company will comply in all material respects with all rules and
regulations of the Commission to the extent and so long as they are applicable
to the Registered Exchange Offer or the Shelf Registration and will make
generally available to its security holders (or otherwise provide in accordance
with Section 11(a) of the Securities Act) an earning statement
satisfying the provisions of Section 11(a) of the Securities Act, no
later than 45 days after the end of a 12-month period (or 90 days, if
such period is a fiscal year) beginning with the first month of the Company’s
first fiscal quarter commencing after the effective date of the Registration
Statement, which statement shall cover such 12-month period.

(m)  The
Company shall cause the Indenture to be qualified under the Trust Indenture Act
of 1939, as amended, in a timely manner and containing such changes, if any, as
shall be necessary for such qualification. In the event that such qualification
would require the appointment of a new trustee under the Indenture, the Company
shall appoint a new trustee thereunder pursuant to the applicable provisions of
the Indenture.

(n)  The
Company may require each Holder of Securities to be sold pursuant to the Shelf
Registration Statement to furnish to the Company such information regarding the
Holder and the distribution of the Securities as the 

 11
 

 

Company may from time to time reasonably require for inclusion
in the Shelf Registration Statement, and the Company may exclude from such
registration the Securities of any Holder that unreasonably fails to furnish
such information within a reasonable time after receiving such request.

(o)  The
Company shall enter into such customary agreements (including, if requested, an
underwriting agreement in customary form) and take all such other action, if
any, as any Holder of the Securities shall reasonably request in order to
facilitate the disposition of the Securities pursuant to any Shelf
Registration.

(p)  In the
case of any Shelf Registration, the Company shall (i) make reasonably
available for inspection by the Holders of the Securities, any underwriter
participating in any disposition pursuant to the Shelf Registration Statement
and any attorney, accountant or other agent retained by the Holders of the
Securities or any such underwriter all relevant financial and other records,
pertinent corporate documents and properties of the Company and (ii) cause
the Company’s officers, directors, employees, accountants and auditors to
supply all relevant information reasonably requested by the Holders of the
Securities or any such underwriter, attorney, accountant or agent in connection
with the Shelf Registration Statement, in each case, as shall be reasonably
necessary to enable such persons, to conduct a reasonable investigation within
the meaning of Section 11 of the Securities Act; provided, however, that
the foregoing inspection and information gathering shall be coordinated on
behalf of the Initial Purchasers by you and on behalf of the other parties, by
one counsel designated by and on behalf of such other parties as described in Section 4
hereof.

(q)  In the
case of any Shelf Registration, the Company, if requested by any Holder of
Securities covered thereby, shall cause (i) its counsel to deliver an
opinion and updates thereof relating to the Securities in customary form
addressed to such Holders and the managing underwriters, if any, thereof and
dated, in the case of the initial opinion, the effective date of such Shelf
Registration Statement (it being agreed that the matters to be covered by such
opinion shall include, without limitation, the due incorporation and good
standing of the Company; the qualification of the Company to transact business
as foreign corporations; the due authorization, execution and delivery of the
relevant agreement of the type referred to in Section 3(o) hereof;
the due authorization, execution, authentication and issuance, and the validity
and enforceability, of the applicable Securities; the absence of material legal
or governmental proceedings involving the Company; the absence of governmental
approvals required to be obtained in connection with the Shelf Registration
Statement, the offering and sale of the applicable Securities, or any agreement
of the type referred to in Section 3(o) hereof; the 

 12
 

 

compliance in all material respects, as to form of
such Shelf Registration Statement and any documents incorporated by reference
therein and of the Indenture with the requirements of the Securities Act and
the Trust Indenture Act, respectively; and (A) as of the date of the
opinion and as of the effective date of the Shelf Registration Statement or
most recent post-effective amendment thereto, as the case may be, the absence,
to the knowledge of such counsel, from such Shelf Registration Statement and
the prospectus included therein, as then amended or supplemented, and from any
documents incorporated by reference therein and (B) as of an applicable
time identified by such Holders or managing underwriters, the absence, to the
knowledge of such counsel, from such prospectus taken together with any other
documents identified by such Holders or managing underwriters, in the case
of (A) and (B), of an untrue statement of a material fact or the
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading (in the case of any
such documents, in the light of the circumstances existing at the time that
such documents were filed with the Commission under the Exchange Act); (ii) its
officers to execute and deliver all customary documents and certificates and
updates thereof reasonably requested by any underwriters of the applicable
Securities and (iii) its independent public accountants and the
independent public accountants with respect to any other entity for which
financial information is provided in the Shelf Registration Statement to
provide to the selling Holders of the applicable Securities and any underwriter
therefor a comfort letter in customary form and covering matters of the type
customarily covered in comfort letters in connection with primary underwritten
offerings, subject to receipt of appropriate documentation as contemplated, and
only if permitted, by Statement of Auditing Standards No. 72.

(r)  In the
case of the Registered Exchange Offer, if requested by any Initial Purchaser or
any known Participating Broker-Dealer, the Company shall cause (i) its
counsel to deliver to such Initial Purchaser or such Participating
Broker-Dealer a signed opinion in the form set forth in Section 7(d) of
the Purchase Agreement with such changes as are customary in connection with
the preparation of a Registration Statement and (ii) its independent
public accountants and the independent public accountants with respect to any
other entity for which financial information is provided in the Registration
Statement to deliver to such Initial Purchaser or such Participating
Broker-Dealer a comfort letter, in customary form, meeting the requirements as
to the substance thereof as set forth in Section 7(a) and (b) of
the Purchase Agreement, with appropriate date changes.

(s)  If a
Registered Exchange Offer or a Private Exchange is to be consummated, upon
delivery of the Initial Securities by Holders to the Company (or to such other
Person as directed by the Company) in exchange for the 

 13
 

 

Exchange Securities or the Private Exchange
Securities, as the case may be, the Company shall mark, or caused to be marked,
on the Initial Securities so exchanged that such Initial Securities are being
canceled in exchange for the Exchange Securities or the Private Exchange
Securities, as the case may be; in no event shall the Initial Securities be
marked as paid or otherwise satisfied.

(t)  The
Company will use its reasonable best efforts to (a) if the Initial
Securities have been rated prior to the initial sale of such Initial
Securities, confirm such ratings will apply to the Securities covered by a
Registration Statement, or (b) if the Initial Securities were not
previously rated, cause the Securities covered by a Registration Statement to
be rated with the appropriate rating agencies, if so requested by Holders of a
majority in aggregate principal amount of Securities covered by such
Registration Statement, or by the managing underwriters, if any.

(u)  In the
event that any broker-dealer registered under the Exchange Act shall underwrite
any Securities or participate as a member of an underwriting syndicate or
selling group or “assist in the distribution” (within the meaning of the
Conduct Rules (the “Rules”) of the National Association of Securities
Dealers, Inc. (“NASD”)) thereof, whether as a Holder of such Securities or
as an underwriter, a placement or sales agent or a broker or dealer in respect
thereof, or otherwise, the Company will assist such broker-dealer in complying
with the requirements of such Rules, including, without limitation, by (i) if
such Rules, including Rule 2720, shall so require, engaging a “qualified
independent underwriter” (as defined in Rule 2720) to participate in the
preparation of the Registration Statement relating to such Securities, to
exercise usual standards of due diligence in respect thereto and, if any
portion of the offering contemplated by such Registration Statement is an
underwritten offering or is made through a placement or sales agent, to
recommend the yield of such Securities, (ii) indemnifying any such
qualified independent underwriter to the extent of the indemnification of
underwriters provided in Section 5 hereof and (iii) providing such
information to such broker-dealer as may be required in order for such
broker-dealer to comply with the requirements of the Rules.

(v)  The
Company shall use its reasonable best efforts to take all other steps necessary
to effect the registration of the Securities covered by a Registration
Statement contemplated hereby.

4. Registration Expenses. The Company shall bear all fees and
expenses incurred by it in connection with the performance of its obligations
under Sections 1 through 3 hereof and shall also pay the reasonable fees and
expenses, if any, of Latham & Watkins LLP, counsel for the Initial
Purchasers, incurred in connection with the Registered 

 14
 

 

Exchange Offer, whether or not the Registered Exchange
Offer is filed or becomes effective, and, in the event a Shelf Registration
Statement is required to be filed hereunder, shall bear or reimburse the
Holders of the Securities covered thereby for the reasonable fees and
disbursements of one firm of counsel designated by the Holders of a majority in
principal amount of the Initial Securities covered thereby to act as counsel
for the Holders of the Initial Securities in connection therewith.

5. Indemnification. (a)  The Company agrees to indemnify
and hold harmless each Holder of the Securities, any Participating
Broker-Dealer and each person, if any, who controls such Holder or such
Participating Broker-Dealer within the meaning of the Securities Act or the
Exchange Act (each Holder, any Participating Broker-Dealer and such controlling
persons are referred to collectively as the “Indemnified Parties”) from and
against any losses, claims, damages or liabilities, joint or several, or any
actions in respect thereof (including, but not limited to, any losses, claims,
damages, liabilities or actions relating to purchases and sales of the
Securities) to which each Indemnified Party may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in a
Registration Statement or prospectus or in any amendment or supplement thereto
or in any preliminary prospectus or “issuer free writing prospectus,” as
defined in Commission Rule 433 (“Issuer FWP”), relating to a Shelf
Registration, or arise out of, or are based upon, the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and shall reimburse,
as incurred, the Indemnified Parties for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action in respect thereof; provided, however, that (i) the
Company shall not be liable in any such case to the extent that such loss,
claim, damage or liability arises out of or is based upon any untrue statement
or alleged untrue statement or omission or alleged omission made in a
Registration Statement or prospectus or in any amendment or supplement thereto
or in any preliminary prospectus or Issuer FWP relating to a Shelf Registration
in reliance upon and in conformity with written information pertaining to such
Holder and furnished to the Company by or on behalf of such Holder specifically
for inclusion therein and (ii) with respect to any untrue statement or
omission or alleged untrue statement or omission made in any preliminary
prospectus relating to a Shelf Registration Statement, the indemnity agreement
contained in this subsection (a) shall not inure to the benefit of
any Holder or Participating Broker-Dealer from whom the person asserting any
such losses, claims, damages or liabilities purchased the Securities concerned,
to the extent that a prospectus relating to such Securities was required to be
delivered (including through satisfaction of the conditions of Commission Rule 172)
by such Holder or Participating Broker-Dealer under the Securities Act in
connection with such purchase and any such loss, claim, damage or liability of
such Holder or Participating Broker-Dealer results from the fact that there was
not conveyed to 

 15
 

 

such person, at or prior to the time of the sale of
such Securities to such person, an amended or supplemented prospectus or, if
permitted by Section 3(d), an Issuer FWP correcting such untrue statement
or omission or alleged untrue statement or omission if the Company had
previously furnished copies thereof to such Holder or Participating
Broker-Dealer; provided further, however, that this indemnity agreement will be
in addition to any liability which the Company may otherwise have to such
Indemnified Party. The Company shall also indemnify underwriters, their
officers and directors and each person who controls such underwriters within
the meaning of the Securities Act or the Exchange Act to the same extent as
provided above with respect to the indemnification of the Holders of the
Securities if requested by such Holders.

(b)  Each
Holder of the Securities, severally and not jointly, will indemnify and hold
harmless the Company and each person, if any, who controls the Company within
the meaning of the Securities Act or the Exchange Act from and against any
losses, claims, damages or liabilities or any actions in respect thereof, to
which the Company or any such controlling person may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in a
Registration Statement or prospectus or in any amendment or supplement thereto
or in any preliminary prospectus or Issuer FWP relating to a Shelf Registration,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact necessary to make the statements therein not
misleading, but in each case only to the extent that the untrue statement or
omission or alleged untrue statement or omission was made in reliance upon and
in conformity with written information pertaining to such Holder and furnished
to the Company by or on behalf of such Holder specifically for inclusion
therein; and, subject to the limitation set forth immediately preceding this
clause, shall reimburse, as incurred, the Company for any legal or other
expenses reasonably incurred by the Company or any such controlling person in
connection with investigating or defending any loss, claim, damage, liability
or action in respect thereof. This indemnity agreement will be in addition to
any liability which such Holder may otherwise have to the Company or any of its
controlling persons.

(c)  Promptly
after receipt by an indemnified party under this Section 5 of notice of
the commencement of any action or proceeding (including a governmental
investigation), such indemnified party will, if a claim in respect thereof is
to be made against the indemnifying party under this Section 5, notify the
indemnifying party of the commencement thereof; but the failure to notify the
indemnifying party shall not relieve the indemnifying party from any liability
that it may have under subsection (a) or (b) above except to the
extent that it has been materially prejudiced (through the forfeiture of
substantive rights or defenses) by such failure; and provided further that the
failure to notify the indemnifying party shall not relieve it from any
liability that it may have to an indemnified party otherwise than under
subsection  (a) or (b) above. In
case any such 

 16
 

 

action is brought
against any indemnified party, and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the
indemnifying party), and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof the
indemnifying party will not be liable to such indemnified party under this Section 5
for any legal or other expenses, other than reasonable costs of investigation,
subsequently incurred by such indemnified party in connection with the defense
thereof. No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened action in
respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party unless
such settlement (i) includes an unconditional release of such indemnified
party from all liability on any claims that are the subject matter of such
action, and (ii) does not include a statement as to or an admission of
fault, culpability or a failure to act by or on behalf of any indemnified
party.

(d)  If
the indemnification provided for in this Section 5 is unavailable or
insufficient to hold harmless an indemnified party under subsections (a) or
(b) above, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to in
subsection (a) or (b) above (i) in such proportion as is
appropriate to reflect the relative benefits received by the indemnifying party
or parties on the one hand and the indemnified party on the other from the
exchange of the Securities, pursuant to the Registered Exchange Offer, or (ii) if
the allocation provided by the foregoing clause (i) is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative
fault of the indemnifying party or parties on the one hand and the indemnified
party on the other in connection with the statements or omissions that resulted
in such losses, claims, damages or liabilities (or actions in respect thereof)
as well as any other relevant equitable considerations. The relative fault of
the parties shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company on the one hand or such Holder or such other indemnified party, as
the case may be, on the other, and the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The amount paid by an indemnified party as a result of the losses,
claims, damages or liabilities referred to in the first sentence of this
subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any action or claim which is the subject of this subsection (d). Notwithstanding
any other provision of this Section 5(d), 

 17
 

 

the Holders of the
Securities shall not be required to contribute any amount in excess of the
amount by which the net proceeds received by such Holders from the sale of the
Securities pursuant to a Registration Statement exceeds the amount of damages
which such Holders have otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission. No person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. For purposes of this paragraph
(d), each person, if any, who controls such indemnified party within the
meaning of the Securities Act or the Exchange Act shall have the same rights to
contribution as such indemnified party and each person, if any, who controls
the Company within the meaning of the Securities Act or the Exchange Act shall
have the same rights to contribution as the Company.

(e)  The
agreements contained in this Section 5 shall survive the sale of the
Securities pursuant to a Registration Statement and shall remain in full force
and effect, regardless of any termination or cancellation of this Agreement or
any investigation made by or on behalf of any indemnified party.

6. Additional Interest Under Certain Circumstances. (a) 
Additional interest (the “Additional Interest”) with respect to the Initial
Securities shall be assessed as follows if any of the following events occur
(each such event in clauses (i) through (iii) below a “Registration
Default”:

(i)  If on or prior
to December 20, 2006, the Exchange Offer Registration Statement has not
been filed with the Commission;

(ii)  If the Company
is required to file a Shelf Registration Statement pursuant to the terms of Section 2(a) above,
the Shelf Registration Statement has not been filed with the Commission on or
prior to the 60th day after the date on which the obligation to file such Shelf
Registration Statement arises, determined in accordance with the terms of Section 2(a) above;

(iii)  If on or
prior to March 20, 2007, neither the Registered Exchange Offer nor, if
required in lieu thereof, the Shelf Registration Statement, is declared
effective by the Commission;

(iv)  if the
Exchange Offer is not consummated on or before the 40th day after the Exchange
Offer Registration Statement is declared effective or, if obligated to file a
Shelf Registration Statement pursuant to the terms of Section 2(a) above,
the Shelf Registration Statement is not declared effective on or prior to the
60th day after the date of the filing of the Shelf Registration Statement; or

 

 18

 

 

(v)  If after either
the Exchange Offer Registration Statement or the Shelf Registration Statement
is declared (or becomes automatically) effective (A) such Registration
Statement thereafter ceases to be effective; or (B) such Registration
Statement or the related prospectus ceases to be usable (except as permitted in
paragraph (b) immediately below) in connection with resales of Transfer
Restricted Securities during the periods specified herein because either (1) any
event occurs as a result of which the related prospectus forming part of such
Registration Statement would include any untrue statement of a material fact or
omit to state any material fact necessary to make the statements therein in the
light of the circumstances under which they were made not misleading, (2) it
shall be necessary to amend such Registration Statement or supplement the
related prospectus, to comply with the Securities Act or the Exchange Act or
the respective rules thereunder, or (3) such Registration Statement
is a Shelf Registration Statement that has expired before a replacement Shelf
Registration Statement has become effective.

Additional
Interest shall accrue on the Initial Securities over and above the interest set
forth in the title of the Securities from and including the date on which any
such Registration Default shall occur to but excluding the date on which all
such Registration Defaults have been cured, at a rate of $0.05 per week per
$1,000 principal amount of the Initial Securities for the first 90-day
period immediately following the occurrence of a Registration Default, and such
rate will increase by an additional $0.05 per week per $1,000 principal amount
of the Initial Securities with respect to each subsequent 90-day period
until all Registration Defaults have been cured, up to a maximum additional
interest rate of 1.0% per annum.

(b)  A
Registration Default referred to in Section 6(a)(v)(B) hereof shall
be deemed not to have occurred and be continuing in relation to a Shelf
Registration Statement or the related prospectus if (i) such Registration
Default has occurred solely as a result of (x) the filing of a
post-effective amendment to such Shelf Registration Statement to incorporate
annual audited financial information with respect to the Company where such post-effective
amendment is not yet effective and needs to be declared effective to permit
Holders to use the related prospectus or (y) other material events with
respect to the Company that would need to be described in such Shelf
Registration Statement or the related prospectus and (ii) in the case of
clause (y), the Company is proceeding promptly and in good faith to amend or
supplement such Shelf Registration Statement and related prospectus to describe
such material events; provided, however, that in any case if such Registration
Default occurs for a continuous period in excess of 30 days, Additional
Interest shall be payable in accordance with the above paragraph from the day
such Registration Default occurs until such Registration Default is cured.

 19
 

 

(c) 
Any amounts of Additional Interest due pursuant to clause (i), (ii), (iii), (iv) or
(v) of Section 6(a) above will be payable in cash on the regular
interest payment dates with respect to the Initial Securities. The amount of
Additional Interest will be determined on the basis of the number of days that
Additional Interest is payable hereunder and on the basis of a 360-day
year comprised of twelve 30-day months.

(d) 
“Transfer Restricted Securities” means each Security until (i) the date on
which such Transfer Restricted Security has been exchanged by a person other
than a broker-dealer for a freely transferable Exchange Security in the
Registered Exchange Offer, (ii) following the exchange by a broker-dealer
in the Registered Exchange Offer of an Initial Security for an Exchange
Security, the date on which such Exchange Security is sold to a purchaser who
receives from such broker-dealer on or prior to the date of such sale a copy of
the prospectus contained in the Exchange Offer Registration Statement, (iii) the
date on which such Transfer Restricted Security has been effectively registered
under the Securities Act and disposed of in accordance with the Shelf
Registration Statement or (iv) the date on which such Transfer Restricted
Security is distributed to the public pursuant to Rule 144 under the
Securities Act or is saleable pursuant to Rule 144(k) under the
Securities Act.

7. Rules 144 and 144A. So long as it is required to do so
by the Indenture, the Company shall use its reasonable best efforts to file the
reports required to be filed by it under the Securities Act and the Exchange
Act in a timely manner and, if at any time the Company is not required to file
such reports, it will, upon the request of any Holder of Initial Securities,
make publicly available other information so long as necessary to permit sales
of their securities pursuant to Rules 144 and 144A. The Company covenants
that it will take such further action as any Holder of Initial Securities may
reasonably request, all to the extent required from time to time to enable such
Holder to sell Initial Securities without registration under the Securities Act
within the limitation of the exemptions provided by Rules 144 and 144A
(including the requirements of Rule 144A(d)(4)). The Company will provide
a copy of this Agreement to prospective purchasers of Initial Securities
identified to the Company by the Initial Purchasers upon written request. Upon
the written request of any Holder of Initial Securities, the Company shall
deliver to such Holder a written statement as to whether it has complied with
such requirements. Notwithstanding the foregoing, nothing in this Section 7
shall be deemed to require the Company to register any of its securities
pursuant to the Exchange Act.

8. Underwritten Registrations. If any of the Transfer
Restricted Securities covered by any Shelf Registration are to be sold in an
underwritten offering, the investment banker or investment bankers and manager
or managers that will administer the offering (“Managing Underwriters”) will be
selected by the Holders of a majority in 

 20
 

 

aggregate principal amount of such Transfer Restricted
Securities to be included in such offering.

No
person may participate in any underwritten registration hereunder unless such
person (i) agrees to sell such person’s Transfer Restricted Securities on
the basis reasonably provided in any underwriting arrangements approved by the
persons entitled hereunder to approve such arrangements and (ii) completes
and executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements.

9. Miscellaneous.

(a)  Amendments and Waivers. The provisions of this Agreement may
not be amended, modified or supplemented, and waivers or consents to departures
from the provisions hereof may not be given, except by the Company and the
written consent of the Holders of a majority in principal amount of the
Securities affected by such amendment, modification, supplement, waiver or
consents.

(b)  Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand delivery, first-class
mail, facsimile transmission, or air courier which guarantees overnight
delivery:

(1) 
if to a Holder of the Securities, at the most current address given by such
Holder to the Company.

(2) 
if to the Initial Purchasers;

c/o Banc of America Securities LLC

9 West 57th Street

31st Floor

New York, New York 10019

Fax No.: (646) 313-4802

Attention:  Legal Department

with a copy to:

Latham & Watkins LLP

885 Third Avenue, Suite 1000

New York, NY 10022

Fax No.: (212) 751-4864

Attention: Peter M. Labonski

 21
 

 

(3)    if
to the Company:

TransDigm Inc.

1301 East 9th Street, Suite 3710

Cleveland, OH 44114

Fax No.: (216) 706-2937

Attention:  Chief Financial Officer

with
a copy to:

Willkie, Farr & Gallagher LLP

787 Seventh Avenue

New York, NY 10019

Fax No.: 212-728-9214

Attention: Cristopher Greer

All
such notices and communications shall be deemed to have been duly given:  at the time delivered by hand, if personally
delivered; three business days after being deposited in the mail, postage
prepaid, if mailed; when receipt is acknowledged by recipient’s facsimile
machine operator, if sent by facsimile transmission; and on the day delivered,
if sent by overnight air courier guaranteeing next day delivery.

(c)  No Inconsistent Agreements. The Company has not, as of the
date hereof, entered into, nor shall it, on or after the date hereof, enter
into, any agreement with respect to its securities that is inconsistent with
the rights granted to the Holders herein or otherwise conflicts with the
provisions hereof.

(d)  Successors and Assigns. This Agreement shall be binding upon
the Company and its successors and assigns.

(e)  Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts (including
by facsimile or electronic image scan), each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one
and the same agreement.

(f)  Headings. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.

(g)  Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAWS.

 22
 

 

(h)  Severability. If any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held invalid,
illegal or unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.

(i)  Securities Held by the Company. Whenever the consent or
approval of Holders of a specified percentage of principal amount of Securities
is required hereunder, Securities held by the Company or its affiliates (other
than subsequent Holders of Securities if such subsequent Holders are deemed to be
affiliates solely by reason of their holdings of such Securities) shall not be
counted in determining whether such consent or approval was given by the
Holders of such required percentage.

 23
 

 

If
the foregoing is in accordance with your understanding of our agreement, please
sign and return to the Company a counterpart hereof, whereupon this instrument,
along with all counterparts, will become a binding agreement among the several
Initial Purchasers and the Company in accordance with its terms.

 

	
  

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  TransDigm Inc.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Nicholas Howley

  
	
   

  	
   

  	
  Name: W. Nicholas Howley

  
	
   

  	
   

  	
  Title: Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  TransDigm Group Incorporated

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Nicholas Howley

  
	
   

  	
   

  	
  Name: W. Nicholas Howley

  
	
   

  	
   

  	
  Title: Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
  Avionic Instruments Inc.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Nicholas Howley

  
	
   

  	
   

  	
  Name: W. Nicholas Howley

  
	
   

  	
   

  	
  Title: Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  Skurka Aerospace Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Nicholas Howley

  
	
   

  	
   

  	
  Name: W. Nicholas Howley

  
	
   

  	
   

  	
  Title: Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  DAC Realty Corp.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Nicholas Howley

  
	
   

  	
   

  	
  Name: W. Nicholas Howley

  
	
   

  	
   

  	
  Title: Chief Executive Officer

  

 24
 

 

 

 

	
  

  	
  Champion Aerospace Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Nicholas Howley

  
	
   

  	
   

  	
  Name: W. Nicholas Howley

  
	
   

  	
   

  	
  Title: Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  MarathonNorco Aerospace Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Nicholas Howley

  
	
   

  	
   

  	
  Name: W. Nicholas Howley

  
	
   

  	
   

  	
  Title: Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  ZMP, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Nicholas Howley

  
	
   

  	
   

  	
  Name: W. Nicholas Howley

  
	
   

  	
   

  	
  Title: Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  Adams Rite Aerospace, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Nicholas Howley

  
	
   

  	
   

  	
  Name: W. Nicholas Howley

  
	
   

  	
   

  	
  Title: Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  Christie Electric Corp.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Nicholas Howley

  
	
   

  	
   

  	
  Name: W. Nicholas Howley

  
	
   

  	
   

  	
  Title: Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  Sweeney Engineering Corp.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gregory Rufus

  
	
   

  	
   

  	
  Name: Gregory Rufus

  
	
   

  	
   

  	
  Title: Secretary and Treasurer

  

 

 25
 

 

The foregoing Registration

Rights Agreement is hereby confirmed

and accepted as of the date first

above written.

 

	
  Banc
  of America Securities LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John McCusker

  	
   

  
	
   

  	
   

  	
  Name: John McCusker

  	
   

  
	
   

  	
   

  	
  Title:Managing Director

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Credit Suisse Securities (USA) LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Edward L. Neuburg

  	
   

  
	
   

  	
   

  	
  Name: Edward L. Neuburg

  	
   

  
	
   

  	
   

  	
  Title:Director

  	
   

  

 

Acting on
behalf of themselves

and  as representatives of

the Initial Purchasers

 

 26

 

ANNEX A

Each
broker-dealer that receives Exchange Securities for its own account pursuant to
the Exchange Offer must acknowledge that it will deliver a prospectus in
connection with any resale of such Exchange Securities. The Letter of
Transmittal states that by so acknowledging and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an “underwriter” within
the meaning of the Securities Act. This Prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of Exchange Securities received in exchange for Initial Securities
where such Initial Securities were acquired by such broker-dealer as a result
of market-making activities or other trading activities. The Company has agreed
that, for a period of 180 days after the Expiration Date (as defined herein),
it will make this Prospectus available to any broker-dealer for use in
connection with any such resale. See “Plan of Distribution.”

 

 

ANNEX B

 

 

Each broker-dealer that receives Exchange Securities
for its own account in exchange for Initial Securities, where such Initial
Securities were acquired by such broker-dealer as a result of market-making
activities or other trading activities, must acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Securities. See “Plan
of Distribution.”

  
  

                                                                                                                                                                                                 
  

 

ANNEX C

 

 

PLAN OF
DISTRIBUTION

Each broker-dealer that receives Exchange Securities
for its own account pursuant to the Exchange Offer must acknowledge that it
will deliver a Prospectus in connection with any resale of such Exchange
Securities. This Prospectus, as it may be amended or supplemented from time to
time, may be used by a broker-dealer in connection with resales of Exchange
Securities received in exchange for Initial Securities where such Initial
Securities were acquired as a result of market-making activities or other
trading activities. The Company has agreed that, for a period of 180 days after
the Expiration Date, it will make this prospectus, as amended or supplemented,
available to any broker-dealer for use in connection with any such resale. In
addition, until [     ],
20[  ], all dealers effecting transactions in the Exchange Securities
may be required to deliver a prospectus.(1)

The Company will not receive any proceeds from any
sale of Exchange Securities by broker-dealers. Exchange Securities received by
broker-dealers for their own account pursuant to the Exchange Offer may be sold
from time to time in one or more transactions in the over-the-counter market,
in negotiated transactions, through the writing of options on the Exchange Securities
or a combination of such methods of resale, at market prices prevailing at the
time of resale, at prices related to such prevailing market prices or
negotiated prices. Any such resale may be made directly to purchasers or to or
through brokers or dealers who may receive compensation in the form of
commissions or concessions from any such broker-dealer or the purchasers
of any such Exchange Securities. Any broker-dealer that resells Exchange
Securities that were received by it for its own account pursuant to the
Exchange Offer and any broker or dealer that participates in a distribution of
such Exchange Securities may be deemed to be an “underwriter” within the
meaning of the Securities Act and any profit on any such resale of Exchange
Securities and any commission or concessions received by any such persons may
be deemed to be underwriting compensation under the Securities Act. The Letter
of Transmittal states that, by acknowledging that it will deliver and by
delivering a prospectus, a broker-dealer will not be deemed to admit that it is
an “underwriter” within the meaning of the Securities Act.

For a period of 180 days after the Expiration Date the
Company will promptly send additional copies of this Prospectus and any
amendment or supplement to this Prospectus to any broker-dealer that requests
such documents in the Letter of Transmittal. The Company has agreed to pay all
of its expenses incident to the Exchange Offer and the reasonable expenses of
one counsel for the Holders of the Securities other than commissions or
concessions of any brokers or dealers and will indemnify the Holders of the
Securities (including any broker-dealers) against certain liabilities,
including liabilities under the Securities Act.

(1) In addition, the legend required by Item 502(e) of
Regulation S-K will appear on the back cover page of the Exchange Offer
prospectus.

 
  

 

ANNEX D

 

 

 

SCHEDULE I

o            CHECK HERE IF YOU ARE A
BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10
COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO.

	
  Name: 

  	
   

  	
   

  
	
  Address: 

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

If the undersigned
is not a broker-dealer, the undersigned represents that it is not engaged in,
and does not intend to engage in, a distribution of Exchange Securities. If the
undersigned is a broker-dealer that will receive Exchange Securities for its
own account in exchange for Initial Securities that were acquired as a result
of market-making activities or other trading activities, it acknowledges that
it will deliver a prospectus in connection with any resale of such Exchange
Securities; however, by so acknowledging and by delivering a prospectus, the
undersigned will not be deemed to admit that it is an “underwriter” within the
meaning of the Securities Act.

 

 

	
  Name of Subsidiary

  	
   

  	
  State or Jurisdiction of

  Incorporation

  
	
   

  	
   

  	
   

  
	
  MarathonNorco Aerospace, Inc.

  	
   

  	
  Delaware

  
	
  ZMP, Inc.

  	
   

  	
  California

  
	
  Adams Rite Aerospace, Inc.

  	
   

  	
  California

  
	
  Champion Aerospace Inc.

  	
   

  	
  Delaware

  
	
  Christie Electric Corp.

  	
   

  	
  California

  
	
  Avionic Instruments, Inc.

  	
   

  	
  Delaware

  
	
  Skurka Aerospace Inc.

  	
   

  	
  Delaware

  
	
  DAC Realty Corp.

  	
   

  	
  New Jersey

  
	
  Sweeney Engineering Corp.

  	
   

  	
  California

  

 

 5EXECUTION COPY

 

CREDIT AGREEMENT

Dated as of
June 23, 2006

Among

THE FINANCIAL
INSTITUTIONS PARTY HERETO

as the Lenders

and

CREDIT SUISSE

as Administrative
Agent and Collateral Agent,

and

TRANSDIGM INC.

and

TRANSDIGM GROUP
INCORPORATED

and

The subsidiaries
of TransDigm Inc. from time to time party hereto

CREDIT SUISSE
SECURITIES (USA) LLC

BANC OF AMERICA SECURITIES LLC

as Joint Lead Arrangers and Joint Bookrunners

BANK OF AMERICA,
N.A.

as Syndication Agent

BARCLAYS BANK PLC

GENERAL ELECTRIC CAPITAL
CORPORATION

UBS SECURITIES LLC

as
Co-Documentation Agents

 

 

 

 

TABLE OF CONTENTS

	
  

  	
   

  	
  Page

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE I

  

  DEFINITIONS

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 1.01.
  Defined Terms

  	
   

  	
  1

  	
   

  
	
  SECTION 1.02.
  Classification of Loans and Borrowings

  	
   

  	
  41

  	
   

  
	
  SECTION 1.03.
  Terms Generally

  	
   

  	
  41

  	
   

  
	
  SECTION 1.04.
  Effectuation of Transactions

  	
   

  	
  42

  	
   

  
	
  SECTION 1.05.
  Accounting Terms; GAAP

  	
   

  	
  42

  	
   

  
	
  SECTION 1.06.
  Designated Senior Debt

  	
   

  	
  42

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  

  THE CREDITS

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 2.01.
  Commitments

  	
   

  	
  42

  	
   

  
	
  SECTION 2.02.
  Loans and Borrowings

  	
   

  	
  43

  	
   

  
	
  SECTION 2.03. Requests
  for Borrowing

  	
   

  	
  44

  	
   

  
	
  SECTION 2.04.
  Funding of Borrowings

  	
   

  	
  45

  	
   

  
	
  SECTION 2.05.
  Type; Interest Elections

  	
   

  	
  45

  	
   

  
	
  SECTION 2.06.
  Termination and Reduction of Commitments

  	
   

  	
  46

  	
   

  
	
  SECTION 2.07.
  Repayment of Loans; Evidence of Debt

  	
   

  	
  47

  	
   

  
	
  SECTION 2.08.
  Optional Prepayment of Loans

  	
   

  	
  48

  	
   

  
	
  SECTION 2.09.
  Mandatory Prepayment of Loans

  	
   

  	
  48

  	
   

  
	
  SECTION 2.10. Fees

  	
   

  	
  49

  	
   

  
	
  SECTION 2.11.
  Interest

  	
   

  	
  50

  	
   

  
	
  SECTION 2.12.
  Alternate Rate of Interest

  	
   

  	
  50

  	
   

  
	
  SECTION 2.13.
  Increased Costs

  	
   

  	
  51

  	
   

  
	
  SECTION 2.14.
  Break Funding Payments

  	
   

  	
  52

  	
   

  
	
  SECTION 2.15.
  Taxes

  	
   

  	
  52

  	
   

  
	
  SECTION 2.16.
  Payments Generally; Allocation of Proceeds; Sharing of Set-offs

  	
   

  	
  54

  	
   

  
	
  SECTION 2.17.
  Mitigation Obligations; Replacement of Lenders

  	
   

  	
  55

  	
   

  
	
  SECTION 2.18.
  Illegality

  	
   

  	
  56

  	
   

  
	
  SECTION 2.19.
  Change of Control

  	
   

  	
  56

  	
   

  
	
  SECTION 2.20.
  Asset Sale Offer

  	
   

  	
  57

  	
   

  
	
  SECTION 2.21.
  Intentionally Omitted

  	
   

  	
  59

  	
   

  
	
  SECTION 2.22.
  Swingline Loans

  	
   

  	
  59

  	
   

  
	
  SECTION 2.23.
  Letters of Credit

  	
   

  	
  61

  	
   

  
	
  SECTION 2.24.
  Increase in Commitments

  	
   

  	
  64

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  

  REPRESENTATIONS AND WARRANTIES

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3.01.
  Organization; Powers

  	
   

  	
  65

  	
   

  
	
  SECTION 3.02.
  Authorization; Enforceability

  	
   

  	
  66

  	
   

  
	
  SECTION 3.03.
  Governmental Approvals; No Conflicts

  	
   

  	
  66

  	
   

  
	
  SECTION 3.04.
  Financial Condition; No Material Adverse Change

  	
   

  	
  66

  	
   

  
	
  SECTION 3.05.
  Properties

  	
   

  	
  67

  	
   

  
	
  SECTION 3.06.
  Litigation and Environmental Matters

  	
   

  	
  67

  	
   

  
	
  SECTION 3.07.
  Compliance with Laws and Agreements; Licenses and Permits

  	
   

  	
  68

  	
   

  
	
  SECTION 3.08.
  Investment Company Status

  	
   

  	
  68

  	
   

  
	
  SECTION 3.09.
  Taxes

  	
   

  	
  68

  	
   

  

 

 ii
 

 

 

	
  SECTION 3.10. ERISA

  	
   

  	
  68

  	
   

  
	
  SECTION 3.11. Disclosure

  	
   

  	
  68

  	
   

  
	
  SECTION 3.12.
  Material Agreements

  	
   

  	
  69

  	
   

  
	
  SECTION 3.13.
  Solvency

  	
   

  	
  69

  	
   

  
	
  SECTION 3.14.
  Insurance

  	
   

  	
  69

  	
   

  
	
  SECTION 3.15.
  Capitalization and Subsidiaries

  	
   

  	
  69

  	
   

  
	
  SECTION 3.16.
  Security Interest in Collateral

  	
   

  	
  70

  	
   

  
	
  SECTION 3.17.
  Labor Disputes

  	
   

  	
  70

  	
   

  
	
  SECTION 3.18.
  Federal Reserve Regulations

  	
   

  	
  70

  	
   

  
	
  SECTION 3.19.
  Senior Debt

  	
   

  	
  70

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  

  CONDITIONS

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4.01. All
  Credit Events

  	
   

  	
  71

  	
   

  
	
  SECTION 4.02.
  Closing Date

  	
   

  	
  71

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  

  AFFIRMATIVE COVENANTS

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5.01.
  Financial Statements and Other Information

  	
   

  	
  74

  	
   

  
	
  SECTION 5.02.
  Notices of Material Events

  	
   

  	
  76

  	
   

  
	
  SECTION 5.03.
  Existence; Conduct of Business

  	
   

  	
  77

  	
   

  
	
  SECTION 5.04.
  Payment of Taxes

  	
   

  	
  77

  	
   

  
	
  SECTION 5.05.
  Maintenance of Properties

  	
   

  	
  77

  	
   

  
	
  SECTION 5.06.
  Books and Records; Inspection Rights

  	
   

  	
  77

  	
   

  
	
  SECTION 5.07.
  Maintenance of Ratings

  	
   

  	
  77

  	
   

  
	
  SECTION 5.08.
  Compliance with Laws

  	
   

  	
  78

  	
   

  
	
  SECTION 5.09. Use
  of Proceeds

  	
   

  	
  78

  	
   

  
	
  SECTION 5.10.
  Insurance

  	
   

  	
  78

  	
   

  
	
  SECTION 5.11.
  Additional Collateral; Further Assurances

  	
   

  	
  78

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  

  NEGATIVE COVENANTS

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6.01.
  Limitation on Incurrence of Additional Indebtedness

  	
   

  	
  80

  	
   

  
	
  SECTION 6.02.
  Limitation on Restricted Payments

  	
   

  	
  80

  	
   

  
	
  SECTION 6.03.
  Limitation on Asset Sales

  	
   

  	
  84

  	
   

  
	
  SECTION 6.04.
  Limitation on Dividend and Other Payment Restrictions Affecting Subsidiaries

  	
   

  	
  85

  	
   

  
	
  SECTION 6.05.
  Limitation on Preferred Stock of Restricted Subsidiaries

  	
   

  	
  86

  	
   

  
	
  SECTION 6.06.
  Limitation on Liens

  	
   

  	
  86

  	
   

  
	
  SECTION 6.07.
  Merger, Consolidation or Sale of All or Substantially All Assets

  	
   

  	
  87

  	
   

  
	
  SECTION 6.08.
  Limitation on Transactions with Affiliates

  	
   

  	
  89

  	
   

  
	
  SECTION 6.09.
  Future Guarantees by Restricted Subsidiaries

  	
   

  	
  91

  	
   

  
	
  SECTION 6.10.
  Business of Borrower and Restricted Subsidiaries

  	
   

  	
  91

  	
   

  
	
  SECTION 6.11.
  Amendments to Subordination Provisions

  	
   

  	
  91

  	
   

  
	
  SECTION 6.12.
  Business of Holdings

  	
   

  	
  91

  	
   

  
	
  SECTION 6.13.
  Impairment of Security Interest

  	
   

  	
  91

  	
   

  
	
  SECTION 6.14.
  Consolidated Secured Debt Ratio

  	
   

  	
  92

  	
   

  

 

 iii
 

 

 

	
  ARTICLE VII

  

  EVENTS OF DEFAULT

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  

  THE AGENT

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX

  

  MISCELLANEOUS

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 9.01.
  Notices

  	
   

  	
  97

  	
   

  
	
  SECTION 9.02.
  Waivers; Amendments

  	
   

  	
  98

  	
   

  
	
  SECTION 9.03.
  Expenses; Indemnity; Damage Waiver

  	
   

  	
  101

  	
   

  
	
  SECTION 9.04.
  Successors and Assigns

  	
   

  	
  102

  	
   

  
	
  SECTION 9.05.
  Survival

  	
   

  	
  106

  	
   

  
	
  SECTION 9.06.
  Counterparts; Integration; Effectiveness

  	
   

  	
  106

  	
   

  
	
  SECTION 9.07.
  Severability

  	
   

  	
  106

  	
   

  
	
  SECTION 9.08.
  Right of Setoff

  	
   

  	
  106

  	
   

  
	
  SECTION 9.09.
  Governing Law; Jurisdiction; Consent to Service of Process

  	
   

  	
  107

  	
   

  
	
  SECTION 9.10.
  WAIVER OF JURY TRIAL

  	
   

  	
  108

  	
   

  
	
  SECTION 9.11.
  Headings

  	
   

  	
  108

  	
   

  
	
  SECTION 9.12.
  Confidentiality

  	
   

  	
  108

  	
   

  
	
  SECTION 9.13.
  Several Obligations; Nonreliance; Violation of Law

  	
   

  	
  108

  	
   

  
	
  SECTION 9.14. USA
  PATRIOT Act

  	
   

  	
  109

  	
   

  
	
  SECTION 9.15.
  Disclosure

  	
   

  	
  109

  	
   

  
	
  SECTION 9.16.
  Appointment for Perfection

  	
   

  	
  109

  	
   

  
	
  SECTION 9.17.
  Interest Rate Limitation

  	
   

  	
  109

  	
   

  
	
   

  	
   

  	
   

  	
   

  

SCHEDULES:

	
  Commitment Schedule

  
	
  Schedule 1.01(a)

  	
  —

  	
  Immaterial Subsidiaries

  
	
  Schedule 1.01(b)

  	
  —

  	
  Mortgaged Properties

  
	
  Schedule 1.01(c)

  	
  —

  	
  Existing Letters of Credit

  
	
  Schedule 1.01(d)

  	
  —

  	
  Existing Indebtedness

  
	
  Schedule 1.01(e)

  	
  —

  	
  Existing Liens

  
	
  Schedule 3.05(a)

  	
  —

  	
  Properties

  
	
  Schedule 3.05(g)

  	
  —

  	
  Intellectual Property

  
	
  Schedule 3.06

  	
  —

  	
  Disclosed Matters

  
	
  Schedule 3.14

  	
  —

  	
  Insurance

  
	
  Schedule 3.15

  	
  —

  	
  Capitalization and Subsidiaries

  
	
  Schedule 3.16

  	
  —

  	
  Mortgage Filing Offices

  
	
  Schedule 3.17

  	
  —

  	
  Labor Disputes

  
	
  Schedule 4.02(b)

  	
  —

  	
  Local Counsel

  
	
  Schedule 9.01

  	
  —

  	
  Borrower’s Website for Electronic Delivery

  

EXHIBITS:

	
  Exhibit A

  	
  —

  	
  Form of Administrative Questionnaire

  
	
  Exhibit B

  	
  —

  	
  Form of Assignment and Assumption

  
	
  Exhibit C

  	
  —

  	
  Form of Compliance Certificate

  

 

 iv
 

 

 

	
  Exhibit D

  	
  —

  	
  Joinder Agreement

  
	
  Exhibit E

  	
  —

  	
  Form of Borrowing Request

  
	
  Exhibit F

  	
  —

  	
  Form of Promissory Notes

  

 

 v

CREDIT
AGREEMENT dated as of June 23, 2006 (this “Agreement”), among
TRANSDIGM INC. (the “Borrower”), a Delaware corporation, TRANSDIGM GROUP
INCORPORATED, a Delaware corporation (“Holdings”), each subsidiary of
the Borrower from time to time party hereto, the Lenders (as defined in Article I)
and CREDIT SUISSE, as administrative agent and collateral agent for the Lenders
hereunder (in such capacities, the “Agent”).

The
Borrower has requested the Lenders to extend credit in the form of (a) Term Loans
(such term and each other capitalized term used but not defined in this
introductory statement having the meaning given it in Article I) on the
Closing Date in an aggregate principal amount not in excess of $650,000,000 and
(b) Revolving Loans, Swingline Loans and Letters of Credit at any time and
from time to time prior to the Revolving Credit Maturity Date in an aggregate
principal amount at any time outstanding not in excess of $150,000,000. The
proceeds of the Term Loans are to be used solely to finance, in part, the
Existing Bank Debt Refinancing, the Tender Offer, the Closing Date Dividend and
the Permitted Transaction Payments. The proceeds of the Revolving Loans,
Swingline Loans and Letters of Credit are to be used solely for general
corporate purposes.

The
Lenders are willing to extend such credit to the Borrower on the terms and
subject to the conditions set forth herein. Accordingly, the parties hereto
agree as follows:

ARTICLE I

Definitions

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

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

“Acquired
Indebtedness” means Indebtedness of a Person or any of its Subsidiaries
existing at the time such Person becomes a Restricted Subsidiary of the
Borrower or at the time it merges or consolidates with or into the Borrower or
any of its Subsidiaries or that is assumed in connection with the acquisition
of assets from such Person, including Indebtedness incurred by such Person in
connection with, or in anticipation or contemplation of, such Person becoming a
Restricted Subsidiary of the Borrower or such acquisition, merger or
consolidation.

“Adjusted
LIBOR Rate” means, for any Interest Period, the rate obtained by dividing (a) the
LIBOR Rate for such Interest Period by (b) a percentage equal to 1 minus
the stated maximum rate (stated as a decimal) of all reserves, if any, required
to be maintained against “Eurocurrency liabilities” as specified in Regulation
D (including any marginal, emergency, special or supplemental reserves).

“Administrative
Questionnaire” means an Administrative Questionnaire in the form of Exhibit A.

“Affiliate”
means, with respect to any specified Person, any other Person who directly or
indirectly through one or more intermediaries controls, or is controlled by, or
is under common control with, such specified Person. The term “control” means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise; and the terms “controlling”
and “controlled” have meanings correlative of the foregoing.

 

 

“Affiliate
Transaction” has the meaning assigned to such term in Section 6.08.

“Agent”
has the meaning assigned to such term in the preamble to this Agreement.

“Agent
Fees” has the meaning assigned to such term in Section 2.10(b).

“Aggregate
Revolving Credit Exposure” means the aggregate amount of the Lenders’
Revolving Credit Exposures.

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

“Applicable
Percentage” means, with respect to any Lender, a percentage equal to a
fraction the numerator of which is the aggregate outstanding principal amount
of the Loans (or, if no Loans are then outstanding, the Commitment) of such
Lender and the denominator of which is the aggregate outstanding principal
amount of the Loans (or, if no Loans are then outstanding, the Commitments) of
all Lenders.

“Applicable
Rate” means, for any day, (a) with respect to any LIBOR Rate Term
Loan, 2.00%, (b) with respect to any ABR Term Loan, 1.00%, and (c) with
respect to any LIBOR Rate Revolving Loan or ABR Revolving Loan, or with respect
to the Commitment Fees, as the case may be, the applicable rate set forth below
under the captions “LIBOR Spread — Revolving Loans”, “ABR Spread Spread —
Revolving Loans” or “Commitment Fee Percentage”, as the case may be, based upon
the Consolidated Leverage Ratio of the Borrower as of the relevant date of determination:

	
  Leverage Ratio

  	
   

  	
  LIBOR Spread — 

  Revolving Loans

  	
   

  	
  ABR Spread — 

  Revolving Loans

  	
   

  	
  Commitment Fee

  Percentage

  
	
  Category 1

  Greater than 4.0 to 1.0

  	
   

  	
  2.00%

  	
   

  	
  1.00%

  	
   

  	
  0.375%

  
	
  Category 2

  Greater than 3.5 to 1.0, but less than

  or equal to 4.0 to 1.0

  	
   

  	
  1.75%

  	
   

  	
  0.75%

  	
   

  	
  0.375%

  
	
  Category 3

  Less than or equal to 3.5 to 1.0

  	
   

  	
  1.50%

  	
   

  	
  0.50%

  	
   

  	
  0.375%

  

 

Each
change in the Applicable Rate resulting from a change in the Consolidated
Leverage Ratio of the Borrower shall be effective with respect to all Loans,
Commitments and Letters of Credit outstanding on and after the date of delivery
to the Agent of the financial statements and certificates required by Section 5.01(a) or
(b) and Section 5.01(c), respectively, indicating such change, and
until the date immediately preceding the next date of delivery of such
financial statements and certificates indicating another such change. In
addition, (a) at any time during which the Borrower has failed to deliver
the financial statements and certificates required by Section 5.01(a) or
(b) and Section 5.01(c), respectively, or (b) at any time after
the occurrence and during the continuance of an Event of

 2
 

 

 

Default, any reduction in interest rates or Commitment
Fees which would otherwise be implemented shall not be implemented until the
date the Event of Default is cured or waived.

“Approved
Fund” means any Person (other than an natural person) that is engaged in
making, purchasing, holding or investing in bank loans and similar extensions
of credit in the ordinary course and that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate
of an entity that administers, advises or manages a Lender.

“Asset
Acquisition” means (a) an Investment by the Borrower or any Restricted
Subsidiary of the Borrower in any other Person pursuant to which such Person
shall become a Restricted Subsidiary of the Borrower, or shall be merged with
or into the Borrower or any Restricted Subsidiary of the Borrower, or (b) the
acquisition by the Borrower or any Restricted Subsidiary of the Borrower of the
assets of any Person (other than a Restricted Subsidiary of the Borrower) other
than in the ordinary course of business.

“Asset Sale” means
any direct or indirect sale, issuance, conveyance, transfer, lease (other than
operating leases entered into in the ordinary course of business), assignment
or other transfer for value by the Borrower or any of its Restricted
Subsidiaries (including any Sale and Leaseback Transaction) to any Person other
than the Borrower or a Restricted Subsidiary of the Borrower of:

(1)            any Capital Stock of any Restricted
Subsidiary of the Borrower, or

(2)            any other property or assets of the
Borrower or any Restricted Subsidiary of the Borrower other than in the
ordinary course of business; provided, however, that Asset Sales or other
dispositions shall not include:

(a)           a transaction or series of related
transactions for which the Borrower or its Restricted Subsidiaries receive
aggregate consideration of less than $1,000,000;

(b)          the sale, lease, conveyance,
disposition or other transfer of all or substantially all of the assets of the
Borrower as permitted under Section 6.07 or any disposition that
constitutes a Change of Control;

(c)           the sale or discount, in each case
without recourse, of accounts receivable arising in the ordinary course of
business, but only in connection with the compromise or collection thereof;

(d)          disposals or replacements of obsolete
equipment in the ordinary course of business;

(e)           the sale, lease, conveyance,
disposition or other transfer by the Borrower or any Restricted Subsidiary of
assets or property to one or more Restricted Subsidiaries in connection with
Investments permitted under Section 6.02 or pursuant to any Permitted
Investment;

(f)           [Intentionally Omitted];

(g)          dispositions of cash or Cash
Equivalents; and

(h)          the creation of a Lien (but not the
sale or other disposition of the property subject to such Lien).

“Asset
Sale Offer” has the meaning assigned to such term in Section 2.20(d).

“Assignment
and Assumption” means an assignment and assumption entered into by a Lender
and an assignee (with the consent of any party whose consent is required by Section 9.04),
and accepted by the Agent, in the form of Exhibit B or any other
form approved by the Agent.

 3
 

 

 

“Attributable
Debt” in respect of a Sale and Lease-Back Transaction means, as at the time
of determination, the present value (discounted at the interest rate then borne
by the Loans, compounded annually) of the total obligations of the lessee for
rental payments during the remaining term of the lease included in such Sale
and Lease-Back Transaction (including any period for which such lease has been
extended); provided, however, that if such Sale and Lease-Back
Transaction results in a Capitalized Lease Obligation, the amount of
Indebtedness represented thereby will be determined in accordance with the
definition of “Capitalized Lease Obligation”.

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

“Board of Directors”
means (a) with respect to a corporation, the board of directors of the
corporation, (b) with respect to a partnership, the board of directors of
the general partner of the partnership and (c) with respect to any other
Person, the board or committee of such Person serving a similar function.

“Board
Resolution” means, with respect to any Person, a duly adopted resolution of
the Board of Directors of such Person or any committee thereof.

“Borrower”
has the meaning assigned to such term in the preamble to this Agreement.

“Borrowing”
means (a) any Loans of the same Class and Type made, converted or
continued on the same date and, in the case of LIBOR Rate Loans, as to which a
single Interest Period is in effect or (b) a Swingline Loan.

“Borrowing
Request” means a request by the Borrower for a Borrowing in accordance with
Section 2.03 and substantially in the form attached hereto as Exhibit E,
or such other form as shall be approved by the Agent.

“Business
Day” means any day that is not a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to remain
closed; provided that, when used in connection with a LIBOR Rate Loan,
the term “Business Day” shall also exclude any day on which banks are not
open for dealings in dollar deposits in the London interbank market.

“Capital Expenditures” means, for
any period, the aggregate of (a) all expenditures (whether paid in cash or
accrued as liabilities) by the Borrower and the Restricted Subsidiaries during
such period that, in conformity with GAAP, are or are required to be included
as additions during such period to property, plant or equipment reflected in
the consolidated balance sheet of the Borrower and the Restricted Subsidiaries
and (b) the value of all assets under Capitalized Lease Obligations
incurred by the Borrower and its Restricted Subsidiaries during such period; provided that the term “Capital Expenditures” shall not
include:

(i) expenditures made in connection with the replacement,
substitution, restoration or repair of assets to the extent financed with (x) insurance
proceeds paid on account of the loss of or damage to the assets being replaced,
restored or repaired or (y) awards of compensation arising from the taking
by eminent domain or condemnation of the assets being replaced,

(ii) the purchase price of equipment that is purchased simultaneously
with the trade-in of existing equipment to the extent that the gross amount of
such purchase price is reduced by the credit granted by the seller of such
equipment for the equipment being traded in at such time,

 4
 

 

 

(iii) the purchase
of plant, property or equipment to the extent financed with the proceeds of
Asset Sales that are not applied to prepay Term Loans pursuant to Section 2.20,

(iv) expenditures
that constitute Consolidated Lease Expense,

(v) expenditures
that are accounted for as capital expenditures by the Borrower or any
Restricted Subsidiary and that actually are paid for by a Person other than the
Borrower or any Restricted Subsidiary and for which neither the Borrower nor
any Restricted Subsidiary has provided or is required to provide or incur,
directly or indirectly, any consideration or obligation to such Person or any
other Person (whether before, during or after such period),

(vi) the book value
of any asset owned by the Borrower or any Restricted Subsidiary prior to or
during such period to the extent that such book value is included as a capital
expenditure during such period as a result of such Person reusing or beginning to
reuse such asset during such period without a corresponding expenditure
actually having been made in such period, provided that (x) any
expenditure necessary in order to permit such asset to be reused shall be
included as a Capital Expenditure during the period in which such expenditure
actually is made and (y) such book value shall have been included in
Capital Expenditures when such asset was originally acquired, or

(vii) expenditures
that constitute acquisitions of Persons or business units permitted hereunder

 

“Capital Stock” means:

(1) 
with respect to any Person that is a corporation, any and all shares,
interests, participations or other equivalents (however designated and whether
or not voting) of corporate stock, including each class of Common Stock and
Preferred Stock, of such Person and

(2) 
with respect to any Person that is not a corporation, any and all partnership
or other equity interests of such Person.

“Capitalized Lease Obligation”
means, as to any Person, the obligations of such Person under a lease that are
required to be classified and accounted for as capital lease obligations under
GAAP and, for purposes of this definition, the amount of such obligations at
any date shall be the capitalized amount of such obligations at such date, determined
in accordance with GAAP.

“Cash Equivalents”
means:

(1) 
marketable direct obligations issued by or unconditionally guaranteed by, the
United States Government or issued by any agency thereof and backed by the full
faith and credit of the United States of America, in each case maturing within
one year from the date of acquisition thereof;

(2) 
marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within one year from the date of acquisition
thereof and, at the time of acquisition, having one of the three highest
ratings obtainable from either S&P or Moody’s;

 5
 

 

 

(3) 
commercial paper maturing no more than one year from the date of creation
thereof and, at the time of acquisition, having a rating of at least A-1
from S&P or at least P-1 from Moody’s;

(4) 
certificates of deposit or bankers’ acceptances maturing within one year from
the date of acquisition thereof issued by any bank organized under the laws of
the United States of America or any state thereof or the District of Columbia
or any U.S. branch of a foreign bank or by a bank organized under the laws of
any foreign country recognized by the United States of America, in each case
having at the date of acquisition thereof combined capital and surplus of not
less than $250,000,000 (or the foreign currency equivalent thereof);

(5) 
repurchase obligations with a term of not more than seven days for underlying
securities of the types described in clause (1) above entered into
with any bank meeting the qualifications specified in clause (4) above;
and

(6) 
investments in money market funds which invest substantially all their assets
in securities of the types described in clauses (1) through (5) above.

“Change
of Control” means the occurrence of one or more of the following events:

(1) 
any sale, lease, exchange or other transfer (in one transaction or a series of
related transactions) of all or substantially all of the assets of the Borrower
or Holdings to any Person or group of related Persons for purposes of Section 13(d) of
the Exchange Act (a “Group”), other than to the Borrower (in the case of the
assets of Holdings), the Permitted Holders or their Related Parties or any
Permitted Group;

(2) 
the approval by the holders of Capital Stock of the Borrower of any plan or
proposal for the liquidation or dissolution of the Borrower (whether or not
otherwise in compliance with the provisions of this Agreement);

(3) 
any Person or Group (other than the Permitted Holders or their Related Parties
or any Permitted Group) shall become the beneficial owner, directly or
indirectly, of shares representing more than 50% of the total ordinary voting
power represented by the issued and outstanding Capital Stock of the Borrower
or Holdings; or

(4) 
the first day on which a majority of the members of the Board of Directors of
the Borrower or Holdings are not Continuing Directors.

“Change
of Control Offer” has the meaning assigned to such term in Section 2.19(b).

“Change
in Law” means (a) the adoption of any law, rule or regulation
after the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the date of this Agreement or (c) compliance by any Lender
or Issuing Bank (or, for purposes of Section 2.13(b), by any lending
office of such Lender or by such Lender’s or Issuing Bank’s holding company, if
any) with any request, guideline or directive (whether or not having the force
of law) of any Governmental Authority made or issued after the date of this
Agreement (other than any such request, guideline or directive to comply with
any law, rule or regulation that was in effect on the date of this
Agreement).

“Class”,
when used in reference to any Loan or Borrowing, refers to whether such Loan,
or the Loans comprising such Borrowing, are Revolving Loans, Term Loans, Other
Revolving Loans, Other Term Loans or Swingline Loans and, when used in
reference to any Commitment, refers to whether such Commitment is a Revolving
Credit Commitment, a Term Loan Commitment, an Incremental Revolving Credit
Commitment, an Incremental Term Loan Commitment or a Swingline Commitment.

 6
 

 

 

“Closing Date” means the date on
which the conditions specified in Section 4.02 are satisfied (or waived in
accordance with Section 9.02).

“Closing Date Dividend” means the
payment of dividends by the Borrower to TransDigm Holdings and by TransDigm
Holdings to Holdings, in each case on the Closing Date, in an aggregate amount
of up to $202,596,000, which dividends Holdings shall use to pay in full all
amounts, if any, due or owing under the Existing Holdings Credit Agreement.

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

“Collateral” means any and all
property owned, leased or operated by a Person subject to a security interest
or Lien under the Collateral Documents and any and all other property of any
Loan Party, now existing or hereafter acquired, that may at any time be or become
subject to a security interest or Lien in favor of Agent, on behalf of itself
and the Lenders, to secure the Secured Obligations; provided, however,
that Collateral shall not at any time include any Margin Stock or leased real
property.

“Collateral Documents” means,
collectively, the Guarantee and Collateral Agreement, the Mortgages and any
other documents granting a Lien upon the Collateral as security for payment of
the Secured Obligations.

“Commitment” means (a) with
respect to any Lender, such Lender’s Revolving Credit Commitment, Term Loan
Commitment and Swingline Commitment as set forth in the Commitment Schedule
or in the most recent Assignment and Assumption executed by such Lender and (b) as
to all Lenders, the aggregate commitment of all Lenders to make Loans, which
aggregate commitment shall be $800,000,000 on the Closing Date.

“Commitment Fee” has the meaning
assigned to such term in Section 2.10(a).

“Commitment Schedule” means the
Schedule attached hereto identified as such.

“Common Stock” of any Person means
any and all shares, interests or other participations in, and other equivalents
(however designated and whether voting or non-voting) of such Person’s common
stock, whether outstanding on the Closing Date or issued after the Closing Date,
and includes, without limitation, all series and classes of such common stock.

“Consolidated EBITDA”
means, with respect to any Person, for any period, the sum (without
duplication) of such Person’s:

(1)            Consolidated Net Income; and

(2)            to the extent Consolidated Net
Income has been reduced thereby:

(a)  all income
taxes and foreign withholding taxes and taxes based on capital and commercial
activity (or similar taxes) of such Person and its Restricted Subsidiaries paid
or accrued in accordance with GAAP for such period;

(b)  Consolidated
Interest Expense;

(c)  Consolidated
Non-cash Charges less any non-cash items increasing Consolidated Net Income for
such period (other than normal accruals in the ordinary course of business),
all as determined on a consolidated basis for such Person and its Restricted
Subsidiaries in accordance with GAAP;

(d)  restructuring
costs, facilities relocation costs and acquisition integration costs and fees,
including cash severance payments made in connection with acquisitions;

 7
 

 

 

(e)  any expenses or
charges related to any Equity Offering, Permitted Investment, acquisition,
disposition, recapitalization or the incurrence of Indebtedness permitted to be
incurred by this Agreement including a refinancing thereof (whether or not successful)
and any amendment or modification to the terms of any such transactions,
including such fees, expenses or charges related to the Transactions;

(f)  any write offs,
write downs or other non-cash charges, excluding any such charge that
represents an accrual or reserve for a cash expenditure for a future period;

(g)  the amount of
any expense related to minority interests;

(h)  the amount of
management, monitoring, consulting and advisory fees and related expenses paid
(or any accruals related to such fees or related expenses) during such period
to the Sponsor to the extent permitted under Section 6.08;

(i)  the amount of
any earn out payments or deferred purchase price in conjunction with
acquisitions;

(j)  any costs or
expenses incurred by the Borrower or a Restricted Subsidiary pursuant to any
management equity plan or stock option plan or any other management or employee
benefit plan or agreement or any stock subscription or stockholders agreement,
to the extent that such costs or expenses are funded with cash proceeds
contributed to the capital of the Borrower or net cash proceeds of issuance of
Qualified Capital Stock of the Borrower (other than Disqualified Stock that is
Preferred Stock) in each case, solely to the extent that such cash proceeds are
excluded from the calculation set forth in clauses (iii)(w) and (iii)(x) of
the first paragraph of Section 6.02;

(k)  the one-time
special bonus payments in an amount not in excess of $6,230,000 by the Borrower
to members of management on November 10, 2005; and

(l)  solely for the
purposes of computations under Section 6.14(a), a charge in any one period
not to exceed $8,000,000 resulting from repurchases of inventory from
distributors during such period; and

(3)            decreased by (without duplication)
non-cash gains increasing Consolidated Net Income of such Person for such
period, excluding any gains that represent the reversal of any accrual of, or
cash reserve for, anticipated cash charges in any prior period (other than such
cash charges that have been added back to Consolidated Net Income in
calculating Consolidated EBITDA in accordance with this definition).

“Consolidated Fixed
Charge Coverage Ratio” means, with respect to any Person, the ratio of
Consolidated EBITDA of such Person during the four full fiscal quarters (the “Four-Quarter
Period”) ending prior to the date of the transaction giving rise to the
need to calculate the Consolidated Fixed Charge Coverage Ratio for which
internal financial statements are available (the “Transaction Date”) to
Consolidated Fixed Charges of such Person for the Four-Quarter Period. In
addition to and without limitation of the foregoing, for purposes of this
definition, “Consolidated EBITDA” and “Consolidated Fixed Charges” shall be
calculated after giving effect on a pro forma basis for the period of such
calculation to:

(1)            the incurrence or repayment of any
Indebtedness or the issuance of any Designated Preferred Stock of such Person
or any of its Restricted Subsidiaries (and the application of the proceeds
thereof) giving rise to the need to make such calculation and any incurrence or
repayment of other Indebtedness or the issuance or redemption of other
Preferred Stock (and the application of the proceeds thereof), other than the
incurrence or repayment of Indebtedness in the ordinary course of business for
working capital purposes pursuant to revolving credit facilities, occurring
during the Four-Quarter Period or at any time subsequent to

 8
 

 

 

the last day of the
Four-Quarter Period and on or prior to the Transaction Date, as if such
incurrence or repayment or issuance or redemption, as the case may be (and the
application of the proceeds thereof), had occurred on the first day of the
Four-Quarter Period; and

(2)            any Asset Sales or other
dispositions or Asset Acquisitions (including, without limitation, any Asset
Acquisition giving rise to the need to make such calculation as a result of
such Person or one of its Restricted Subsidiaries (including any Person who
becomes a Restricted Subsidiary as a result of the Asset Acquisition)
incurring, assuming or otherwise being liable for Acquired Indebtedness and
also including any Consolidated EBITDA attributable to the assets which are the
subject of the Asset Acquisition or Asset Sale or other disposition and without
regard to clause (6) of the definition of Consolidated Net Income),
investments, mergers, consolidations and disposed operations (as determined in
accordance with GAAP) occurring during the Four-Quarter Period or at any time
subsequent to the last day of the Four-Quarter Period and on or prior to the
Transaction Date, as if such Asset Sale or other disposition or Asset
Acquisition (including the incurrence or assumption of any such Acquired
Indebtedness), investment, merger, consolidation or disposed operation occurred
on the first day of the Four-Quarter Period. If such Person or any of its
Restricted Subsidiaries directly or indirectly guarantees Indebtedness of a
third Person, the preceding sentence shall give effect to the incurrence of
such guaranteed Indebtedness as if such Person or any Restricted Subsidiary of
such Person had directly incurred or otherwise assumed such other Indebtedness
that was so guaranteed.

Furthermore, in calculating “Consolidated Fixed
Charges” for purposes of determining the denominator (but not the numerator) of
this “Consolidated Fixed Charge Coverage Ratio”:

(1)            interest on outstanding Indebtedness
determined on a fluctuating basis as of the Transaction Date and which will
continue to be so determined thereafter shall be deemed to have accrued at a
fixed rate per annum equal to the rate of interest on such Indebtedness in
effect on the Transaction Date; and

(2)            notwithstanding clause (1) of
this paragraph, interest on Indebtedness determined on a fluctuating basis, to
the extent such interest is covered by agreements relating to Interest Swap
Obligations, shall be deemed to accrue at the rate per annum resulting after
giving effect to the operation of such agreements.

For purposes of this definition, whenever pro forma
effect is to be given to an acquisition of assets, the amount of income or
earnings relating thereto and the amount of Consolidated Interest Expense
associated with any Indebtedness incurred in connection therewith, the pro
forma calculations shall be determined in good faith by a responsible financial
or accounting officer of the Borrower. In addition, any such pro forma
calculation may include adjustments appropriate, in the reasonable
determination of the Borrower as set forth in an officers’ certificate, to
reflect operating expense reductions reasonably expected to result from any
acquisition or merger.

“Consolidated Fixed
Charges” means, with respect to any Person for any period, the sum of,
without duplication:

(1)            Consolidated Interest Expense; plus

(2)            the product of (x) the amount
of all cash dividend payments on any series of Preferred Stock of such Person
times (y) a fraction, the numerator of which is one and the denominator of
which is one minus the then current effective consolidated federal, state and
local income tax rate of such Person, expressed as a decimal (as estimated in
good faith by the chief financial officer of the Borrower, which estimate shall
be conclusive); plus

 9
 

 

 

(3)            the product of (x) the amount
of all dividend payments on any series of Permitted Subsidiary Preferred Stock
times (y) a fraction, the numerator of which is one and the denominator of
which is one minus the then current effective consolidated federal, state and
local income tax rate of such Person, expressed as a decimal (as estimated in
good faith by the chief financial officer of the Borrower, which estimate shall
be conclusive); provided that with respect to any series of Preferred Stock
that did not pay cash dividends during such period but that is eligible to pay
dividends during any period prior to the Term Loan Maturity Date, cash
dividends shall be deemed to have been paid with respect to such series of
Preferred Stock during such period for purposes of this clause (3).

“Consolidated Interest
Expense” means, with respect to any Person for any period, the sum of,
without duplication:

(1) 
the aggregate of all cash and non-cash interest expense (net of interest
income) with respect to all outstanding Indebtedness of such Person and its
Restricted Subsidiaries, including the net costs associated with Interest Swap
Obligations, for such period determined on a consolidated basis in conformity
with GAAP, but excluding (i) amortization or write-off of debt issuance
costs, deferred financing fees, commissions, fees and expenses, (ii) any
expensing of bridge, commitment and other financing fees, (iii) [Intentionally
Omitted] and (iv) any redemption premium paid in connection with the
redemption of the Existing Notes;

(2) 
the consolidated interest expense of such Person and its Restricted
Subsidiaries that was capitalized during such period; and

(3) 
the interest component of Capitalized Lease Obligations paid, accrued and/or
scheduled to be paid or accrued by such Person and its Restricted Subsidiaries
during such period as determined on a consolidated basis in accordance with
GAAP.

“Consolidated
Lease Expense” means for any period, all rental expenses of the Borrower
and its Restricted Subsidiaries during such period under operating leases for
real or personal property (including in connection with Sale and Lease-Back
Transactions permitted hereunder), excluding real estate taxes, insurance costs
and common area maintenance charges and net of sublease income, other than (a) obligations
under vehicle leases entered into in the ordinary course of business, (b) all
such rental expenses associated with assets acquired pursuant to an acquisition
of a Person or business unit to the extent such rental expenses relate to
operating leases in effect at the time of (and immediately prior to) such acquisition
and related to periods prior to such acquisition and (c) all Capitalized
Lease Obligations, all as determined on a consolidated basis in accordance with
GAAP.

“Consolidated Leverage Ratio”,
with respect to any Person as of any date of determination, means the ratio of (a) Consolidated
Total Indebtedness of such Person as of the end of the most recent fiscal
quarter for which internal financial statements are available immediately
preceding the date on which such event for which such calculation is being made
shall occur to (b) the aggregate amount of Consolidated EBITDA of such
Person for the period of the most recently ended four full consecutive fiscal
quarters for which internal financial statements are available immediately
preceding the date on which such event for which such calculation is being made
shall occur, in each case with such pro
forma adjustments to Consolidated Total Indebtedness and Consolidated
EBITDA as are appropriate and consistent with the pro forma adjustment provisions set forth in the definition of “Consolidated
Fixed Charge Coverage Ratio”.

“Consolidated Net
Income” means, for any period, the aggregate net income (or loss) of the
Borrower and its Restricted Subsidiaries for such period on a consolidated
basis, determined in accordance with GAAP and without any deduction in respect
of Preferred Stock dividends; provided that there shall be excluded therefrom
to the extent otherwise included, without duplication:

 10

 

(1) 
gains and losses from Assets Sales (without regard to the $1,000,000 limitation
set forth in the definition thereof) and the related tax effects according to
GAAP;

(2) 
gains and losses due solely to fluctuations in currency values and the related
tax effects according to GAAP;

(3) 
all extraordinary, unusual or non-recurring charges, gains and losses
(including, without limitation, all restructuring costs, facilities relocation
costs, acquisition integration costs and fees, including cash severance payments
made in connection with acquisitions, and any expense or charge related to the
repurchase of Capital Stock or warrants or options to purchase Capital Stock),
and the related tax effects according to GAAP;

(4) 
the net income (or loss) from disposed or discontinued operations or any net
gains or losses on disposal of disposed or discontinued operations, and the
related tax effects according to GAAP;

(5) 
any impairment charge or asset write-off, in each case pursuant to GAAP, and
the amortization of intangibles arising pursuant to GAAP;

(6) 
the net income (or loss) of any Person acquired in a pooling of interests
transaction accrued prior to the date it becomes a Restricted Subsidiary of the
Borrower or is merged or consolidated with or into the Borrower or any
Restricted Subsidiary of the Borrower;

(7) 
solely for the purpose of determining the amount available for Restricted
Payments under clause (ii) of the first paragraph of Section 6.02,
the net income (but not loss) of any Restricted Subsidiary of the Borrower
(other than a Guarantor) to the extent that the declaration of dividends or
similar distributions by that Restricted Subsidiary of the Borrower of that
income is not at the date of determination wholly permitted without any prior
governmental approval (which has not been obtained) or, directly or indirectly,
by the operation of the terms of its charter or any agreement, instrument,
judgment, decree, order, statute, rule, or governmental regulation applicable
to that Restricted Subsidiary or its stockholders, unless such restriction with
respect to the payment of dividends or similar distributions has been legally
waived; provided that Consolidated Net Income of the Borrower will be increased
by the amount of dividends or other distributions or other payments actually
paid in cash (or to the extent converted into cash) to the Borrower or a
Restricted Subsidiary thereof in respect of such period, to the extent not
already included therein;

(8) 
the net loss of any Person, other than a Restricted Subsidiary of the Borrower;

(9) 
the net income of any Person, other than a Restricted Subsidiary of the
Borrower, except to the extent of cash dividends or distributions paid to the
Borrower or a Restricted Subsidiary of the Borrower by such Person;

(10) 
in the case of a successor to the referent Person by consolidation or merger or
as a transferee of the referent Person’s assets, any earnings of the successor
corporation prior to such consolidation, merger or transfer of assets;

(11)  any non-cash compensation charges and
deferred compensation charges, including any arising from existing stock
options resulting from any merger or recapitalization transaction; provided,
however, that Consolidated Net Income for any period shall be reduced by any
cash payments made during such period by such Person in connection with any
such deferred compensation, whether or not such reduction is in accordance with
GAAP; and

(12)  inventory purchase accounting adjustments and
amortization and impairment charges resulting from other purchase accounting
adjustments with respect to acquisition transactions.

 11
 

 

 

For
purposes of clause (iii)(v) of the first paragraph of Section 6.02,
Consolidated Net Income shall be reduced by any cash dividends paid with
respect to any series of Designated Preferred Stock

“Consolidated
Non-cash Charges” means, with respect to any Person, for any period, the
aggregate depreciation, amortization and other non-cash charges, impairments
and expenses of such Person and its Restricted Subsidiaries reducing
Consolidated Net Income of such Person and its Restricted Subsidiaries for such
period, determined on a consolidated basis in accordance with GAAP (excluding
any such charges that require an accrual of or a reserve for cash payments for
any future period other than accruals or reserves associated with mandatory
repurchases of equity securities). For clarification purposes, purchase
accounting adjustments with respect to inventory will be included in
Consolidated Non-cash Charges.

“Consolidated
Secured Debt Ratio” as of any date of determination means the ratio of (a) Consolidated
Total Indebtedness of the Borrower and the Restricted Subsidiaries that is
secured by first-priority Liens on Collateral as of the end of the most recent
fiscal quarter for which internal financial statements are available
immediately preceding the date on which such event for which such calculation
is being made shall occur to (b) the aggregate amount of Consolidated
EBITDA of the Borrower and the Restricted Subsidiaries for the period of the
most recently ended consecutive four full fiscal quarters for which internal
financial statements are available immediately preceding the date on which such
event for which such calculation is being made shall occur, in each case with
such pro forma adjustments to Consolidated Total Indebtedness and Consolidated
EBITDA as are appropriate and consistent with the pro forma adjustment
provisions set forth in the definition of “Consolidated Fixed Charge Coverage
Ratio”.

“Consolidated
Total Indebtedness” means, as at any date of determination, an amount equal
to the sum of (a) the aggregate amount of all outstanding Indebtedness of
the Borrower and the Restricted Subsidiaries on a consolidated basis consisting of Indebtedness for borrowed money,
obligations in respect of Capitalized Lease Obligations, Attributable Debt in
respect of Sale and Lease-Back Transactions and debt obligations evidenced by
bonds, notes, debentures or similar instruments or letters of credit or bankers’
acceptances (and excluding (x) any undrawn letters of credit issued in the
ordinary course of business and (y) [Intentionally Omitted]) and (b) the
aggregate amount of all outstanding Disqualified Capital Stock of the Borrower
and all Disqualified Capital Stock and Preferred Stock of the Restricted
Subsidiaries (excluding items eliminated in consolidation), with the amount of
such Disqualified Capital Stock and Preferred Stock equal to the greater of
their respective voluntary or involuntary liquidation preferences and Maximum Fixed
Repurchase Prices, in each case determined on a consolidated basis in
accordance with GAAP. For purposes of this definition, the “Maximum Fixed
Repurchase Price” of any Disqualified Capital Stock or Preferred Stock that
does not have a fixed repurchase price shall be calculated in accordance with
the terms of such Disqualified Capital Stock or Preferred Stock as if such
Disqualified Capital Stock or Preferred Stock were purchased on any date on
which Consolidated Total Indebtedness shall be required to be determined
pursuant to this Agreement, and if such price is based upon, or measured by,
the fair market value of such Disqualified Capital Stock or Preferred Stock,
such fair market value shall be determined reasonably and in good faith by the
Borrower.

“Consolidated
Working Capital” means, at any date, the excess of (a) the sum of all
amounts (other than cash and Cash Equivalents) that would, in conformity with
GAAP, be set forth opposite the caption “total current assets” (or any like
caption) on a consolidated balance sheet of the Borrower and its Restricted
Subsidiaries at such date over (b) the sum of all amounts that would, in
conformity with GAAP, be set forth opposite the caption “total current
liabilities” (or any like caption) on a consolidated balance sheet of the
Borrower and its Restricted Subsidiaries on such date, including

 12
 

 

 

deferred revenue but excluding, without duplication, (i) the
current portion of any Funded Debt, (ii) the current portion of interest
and (iii) the current portion of current and deferred income taxes.

“Continuing
Directors” means, as of any date of determination, any member of the
Board of Directors of the Borrower or Holdings who:

(1)            was a member of such Board of
Directors on the Closing Date; or

(2)            was nominated for election or
elected to such Board of Directors by any of the Permitted Holders or with the
approval of a majority of the Continuing Directors who were members of such
Board at the time of such nomination or election.

“Credit Event” has the meaning assigned to
such term in Section 4.01.

“Currency Agreement” means any
foreign exchange contract, currency swap agreement or other similar agreement
or arrangement designed to protect the Borrower or any Restricted Subsidiary of
the Borrower against fluctuations in currency values

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

“Derivative
Transaction” means (a) an interest-rate transaction, including an
interest-rate swap, basis swap, forward rate agreement, interest rate option
(including a cap, collar, and floor), and any other instrument linked to
interest rates that gives rise to similar credit risks (including when-issued
securities and forward deposits accepted), (b) an exchange-rate
transaction, including a cross-currency interest-rate swap, a forward
foreign-exchange contract, a currency option, and any other instrument linked
to exchange rates that gives rise to similar credit risks, (c) an equity
derivative transaction, including an equity-linked swap, an equity-linked
option, a forward equity-linked contract, and any other instrument linked to
equities that gives rise to similar credit risk and (d) a commodity
(including precious metal) derivative transaction, including a commodity-linked
swap, a commodity-linked option, a forward commodity-linked contract, and any
other instrument linked to commodities that gives rise to similar credit risks;
provided that no phantom stock or similar plan providing for payments
only on account of services provided by current or former directors, officers,
employees or consultants of the Borrower or its subsidiaries shall be a
Derivative Transaction.

“Designated Noncash Consideration” means
any non-cash consideration received by the Borrower or one of its Restricted
Subsidiaries in connection with an Asset Sale that is designated as Designated
Non-cash Consideration pursuant to an officers’ certificate executed by the
principal executive officer and the principal financial officer of the Borrower
or such Restricted Subsidiary at the time of such Asset Sale. Any particular
item of Designated Non-cash Consideration will cease to be considered to be
outstanding once it has been sold for cash or Cash Equivalents.

“Designated
Preferred Stock” means Preferred Stock that is so designated as Designated
Preferred Stock pursuant to an officers’ certificate executed by the principal
executive officer and the principal financial officer of the Borrower, on the
issuance date thereof, the cash proceeds of which are excluded from the
calculation set forth in clause (iii)(w) of the first paragraph of Section 6.02.

“Disclosed
Matters” means the actions, suits and proceedings and the environmental
matters disclosed in Schedule 3.06.

“Disqualified Capital
Stock” means with respect to any Person, any Capital Stock which by its
terms (or by the terms of any security into which it is convertible or for
which it is exchangeable at the option of the holder) or upon the happening of
any event:

 13
 

 

 

(1) 
matures or is mandatorily redeemable (other than redeemable only for Capital
Stock of such Person which is not itself Disqualified Capital Stock) pursuant
to a sinking fund obligation or otherwise;

(2) 
is convertible or exchangeable at the option of the holder for Indebtedness or Disqualified
Capital Stock; or

(3) 
is mandatorily redeemable or must be purchased upon the occurrence of certain
events or otherwise, in whole or in part;

in each case on or prior to the Term Loan Maturity
Date; provided, however, that any Capital Stock that would not constitute
Disqualified Capital Stock but for provisions thereof giving holders thereof
the right to require such Person to purchase or redeem such Capital Stock upon
the occurrence of an “asset sale” or “change of control” occurring prior to the
Term Loan Maturity Date shall not constitute Disqualified Capital Stock if:

(1) 
the “asset sale” or “change of control” provisions applicable to such Capital
Stock are not more favorable to the holders of such Capital Stock than the
terms applicable to the Loans hereunder and described under Sections 6.03, 2.20
and 2.19; and

(2) 
any such requirement only becomes operative after compliance with such terms
applicable under this Agreement, including the prepayment of Term Loans
pursuant hereto.

The amount of any Disqualified Capital Stock that does
not have a fixed redemption, repayment or repurchase price will be calculated
in accordance with the terms of such Disqualified Capital Stock as if such
Disqualified Capital Stock were redeemed, repaid or repurchased on any date on
which the amount of such Disqualified Stock is to be determined pursuant to
this Agreement; provided, however, that if such Disqualified Capital Stock
could not be required to be redeemed, repaid or repurchased at the time of such
determination, the redemption, repayment or repurchase price will be the book
value of such Disqualified Capital Stock as reflected in the most recent
internal financial statements of such Person.

“Dollars”
or “$” refers to lawful money of the United States of America.

“Domestic
Restricted Subsidiary” means any direct or indirect Restricted Subsidiary
of the Borrower that is incorporated under the laws of the United States of
America, any State thereof or the District of Columbia.

“Domestic
Subsidiary” means, with respect to any Person, any Restricted Subsidiary of
such Person other than (a) a Foreign Subsidiary or (b) any Domestic
Subsidiary of a Foreign Subsidiary, but, in each case, including any subsidiary
that guarantees or otherwise provides direct credit support for any
indebtedness of the Borrower.

“Eligible
Assignee” means (i) a Lender, (ii) a commercial bank, insurance
company, or company engaged in making commercial loans or a commercial finance
company, which Person, together with its Affiliates, has a combined capital and
surplus in excess of $100,000,000, (iii) any Affiliate of a Lender under
common control with such Lender or (iv) an Approved Fund of a Lender, provided
that in any event, “Eligible Assignee” shall not include (w) any natural
person, (x) Holdings or the Borrower or any Affiliate (which for this
purpose shall not include the Agent or any of its branches or Affiliates
engaged in the business of making commercial loans) thereof, (y) any
Sponsor or any of their respective Affiliates or (z) any “creditor”, as
defined in Regulation T, or “foreign branch of a broker-dealer”, within
the meaning of Regulation X; provided, however, that upon
the occurrence of an Event of Default, no Person (other than a Lender) shall be
an “Eligible Assignee” if the assignment of any Commitment or Loan to such
Person would cause such Person to have Commitments or Loans in excess of
twenty-five percent (25%) of the then outstanding total aggregate Commitments
or Loans, as the case may be.

 14
 

 

 

“Environmental
Laws” means all laws, rules, regulations, codes, ordinances, orders,
decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by any Governmental Authority, relating in any way
to the environment, preservation or reclamation of natural resources, the
management, release or threatened release of any Hazardous Material or to
health and safety matters.

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

“Equity
Interests” means Capital Stock and all warrants, options or other rights to
acquire Capital Stock, but excluding any debt security that is convertible
into, or exchangeable for, Capital Stock.

“Equity Offering”
means any offering of Qualified Capital Stock of Holdings or the Borrower;
provided that:

(1) 
in the event of an offering by Holdings, Holdings contributes to the capital of
the Borrower the portion of the net cash proceeds of such offering necessary to
pay the aggregate redemption price (plus accrued interest to the redemption
date) of the Senior Subordinated Notes to be redeemed pursuant to the optional
redemption provisions contained in the Senior Subordinated Notes Indenture
applicable in connection with Equity Offerings and

(2) 
in the event such equity offering is not in the form of a public offering
registered under the Securities Act, the proceeds received by the Borrower
directly or indirectly from such offering are not less than $10,000,000.

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

“ERISA
Affiliate” means any trade or business (whether or not incorporated) that,
together with the Borrower, is treated as a single employer under Section 414(b) or
(c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412
of the Code, is treated as a single employer under Section 414 of the
Code.

“ERISA
Event” means (a) any “reportable event”, as defined in Section 4043
of ERISA or the regulations issued thereunder with respect to a Plan (other
than an event for which the 30-day notice period is waived); (b) the
existence with respect to any Plan of an “accumulated funding deficiency” (as
defined in Section 412 of the Code or Section 302 of ERISA), whether
or not waived; (c) the filing pursuant to Section 412(d) of the
Code or Section 303(d) of ERISA of an application for a waiver of the
minimum funding standard with respect to any Plan; (d) the incurrence by
the Borrower or any of its ERISA Affiliates of any liability under
Title IV of ERISA with respect to the termination of any Plan; (e) the
receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice of an intent to terminate any Plan or Plans or to
appoint a trustee to administer any Plan; (f) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the
receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by
any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is insolvent or in reorganization, within the meaning of
Title IV of ERISA.

 15
 

 

 

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

“Excess Cash Flow” means, for any
fiscal year of the Borrower, an amount equal to the excess of:

(a) the
sum, without duplication, of:

(i) Consolidated
Net Income for such period,

(ii) an
amount equal to the amount of all non-cash charges to the extent deducted in
arriving at such Consolidated Net Income,

(iii) decreases
in Consolidated Working Capital and long-term account receivables for such
period (other than any such decreases arising from acquisitions by the Borrower
and its Restricted Subsidiaries completed during such period), and

(iv) an
amount equal to the aggregate net non-cash loss on the sale, lease, transfer or
other disposition of assets by the Borrower and its Restricted Subsidiaries
during such period (other than sales in the ordinary course of business) to the
extent deducted in arriving at such Consolidated Net Income; over

(b) the
sum, without duplication, of:

(i) an
amount equal to the amount of all non-cash credits included in arriving at such
Consolidated Net Income and cash charges included in clauses (1) through
(12) of the definition of Consolidated Net Income,

(ii) without
duplication of amounts deducted pursuant to clause (xi) below in prior periods,
the amount of Capital Expenditures made in cash during such period, except to
the extent that such Capital Expenditures were financed with the proceeds of
Indebtedness of the Borrower or its Restricted Subsidiaries,

(iii) the
aggregate amount of all principal payments of Indebtedness of the Borrower and
its Restricted Subsidiaries (including (x) the principal component of
payments in respect of Capitalized Lease Obligations and (y) all voluntary
prepayments of Loans including the amount of any prepayment of Loans pursuant
to Section 2.08 or 2.20 made with the proceeds of an Asset Sale to the
extent such Asset Sale resulted in an increase to Consolidated Net Income and
not in excess of the amount of such increase) made during such period (other
than in respect of any revolving credit facility to the extent there is not an
equivalent permanent reduction in commitments thereunder), except to the extent
financed with the proceeds of other Indebtedness of the Borrower or its
Restricted Subsidiaries,

(iv) an
amount equal to the aggregate net non-cash gain on the sale, lease, transfer or
other disposition of assets by the Borrower and its Restricted Subsidiaries
during such period (other than sales in the ordinary course of business) to the
extent included in arriving at such Consolidated Net Income,

(v) increases
in Consolidated Working Capital and long-term account receivables for such period
(other than any such increases arising from acquisitions of  a Person or business unit by the Borrower and
its Restricted Subsidiaries during such period),

 16
 

 

 

(vi) cash
payments by the Borrower and its Restricted Subsidiaries during such period in
respect of long-term liabilities of the Borrower and its Restricted
Subsidiaries other than Indebtedness,

(vii) without
duplication of amounts deducted pursuant to clause (xi) below in prior periods,
the amount of Investments and acquisitions made during such period to the
extent permitted under Section 6.02, to the extent that such Investments
and acquisitions were financed with internally generated cash flow of the
Borrower and its Restricted Subsidiaries,

(viii) the
amount of Restricted Payments made during such period to the extent permitted
under clause (7) of the second paragraph of Section 6.02, to the
extent that such Restricted Payments were financed with internally generated
cash flow of the Borrower and its Restricted Subsidiaries,

(ix) the
aggregate amount of expenditures actually made by the Borrower and the
Restricted Subsidiaries in cash during such period (including expenditures for
the payment of financing fees) to the extent that such expenditures are not expensed
during such period,

(x) the
aggregate amount of any premium, make-whole or penalty payments actually paid
in cash by the Borrower and the Restricted Subsidiaries during such period that
are required to be made in connection with any prepayment of Indebtedness,

(xi)
without duplication of amounts deducted from Excess Cash Flow in prior periods,
the aggregate consideration required to be paid in cash by the Borrower or any
of its Restricted Subsidiaries pursuant to binding contracts (the “Contract Consideration”) entered
into prior to or during such period relating to acquisitions or Capital
Expenditures to be consummated or made during the period of four consecutive
fiscal quarters of the Borrower following the end of such period, provided that to the extent the aggregate amount of
internally generated cash actually utilized to finance such acquisitions or
Capital Expenditures during such period of four consecutive fiscal quarters is
less than the Contract Consideration, the amount of such shortfall shall be
added to the calculation of Excess Cash Flow at the end of such period of four
consecutive fiscal quarters,

(xii)
the amount of cash taxes paid in such period to the extent they exceed the
amount of tax expense deducted in determining Consolidated Net Income for such
period and the amount of any taxes paid for the benefit of Holdings pursuant to
any tax sharing agreement, and

(xiii)
earnout payments and deferred purchase price payments made in cash during such
fiscal year to the extent added back to Consolidated EBITDA.

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the SEC promulgated thereunder.

“Excluded Contribution”
means net cash proceeds, Marketable Securities or Qualified Proceeds received
by the Borrower from

(1)            contributions to its common equity
capital, and

(2)            the sale (other than to a Subsidiary
of the Borrower or to any management equity plan or stock option plan or any
other management or employee benefit plan or agreement of the Borrower) of
Capital Stock (other than Disqualified Stock and Designated Preferred Stock) of
the Borrower,

 17
 

 

 

in each case designated as Excluded Contributions
pursuant to an officers’ certificate executed by an executive vice president
and the principal financial officer of the Borrower on the date such capital
contributions are made or the date such Capital Stock is sold, as the case may
be, which are excluded from the calculation set forth in clause (iii) of
the first paragraph of Section 6.02.

“Excluded
Taxes” means, with respect to the Agent, any Lender or any other recipient
of any payment to be made by or on account of any obligation of the Borrower or
any other Loan Party hereunder, (a) income or franchise taxes imposed on
(or measured by) its net income by the United States of America, or by the
jurisdiction under the laws of which such recipient is organized or in which
its principal office is located or, in the case of any Lender, in which its
applicable lending office is located, (b) any branch profits taxes imposed
by the United States of America or any similar tax imposed by any other
jurisdiction in which the Borrower or any other Loan Party is located and (c) in
the case of a Foreign Lender (other than an assignee pursuant to a request by
the Borrower under Section 2.17(b)), any withholding tax that is imposed
on amounts payable to such Foreign Lender at the time such Foreign Lender
becomes a party to this Agreement (or designates a new lending office) or is
attributable to such Foreign Lender’s failure to comply with Section 2.15(e),
except to the extent that such Foreign Lender (or its assignor, if any) was
entitled, at the time of designation of a new lending office (or assignment),
to receive additional amounts from the Borrower or any other Loan Party with
respect to such withholding tax pursuant to Section 2.15(a).

“Existing
Bank Debt Refinancing” means the payment in full of all amounts, if any,
due or owing under the Existing Borrower Credit Agreement and the Existing
Holdings Credit Agreement, the termination of all commitments thereunder and
the release and discharge of all guarantees thereof (if any) and all security
therefor (if any).

“Existing
Borrower Credit Agreement” means the Amended and Restated Credit Agreement
dated as of April 1, 2004, as amended, among the Borrower, Holdings, the
lenders party thereto and Credit Suisse, as administrative agent.

“Existing
Notes” means the 8.375% Senior Subordinated Notes due 2011 of the Borrower.

“Existing
Holdings Credit Agreement” means the Loan Agreement dated as of November 10,
2005, as amended, among Holdings, the lenders party thereto and Banc of America
Bridge LLC, as administrative agent.

“Existing
Letters of Credit” means the letters of credit outstanding as of the
Closing Date that are issued under the Existing Borrower Credit Agreement and
set forth on Schedule 1.01(c).

“fair
market value” means, with respect to any asset or property, the price which
could be negotiated in an arm’s-length, free market transaction, for
cash, between a willing seller and a willing and able buyer, neither of whom is
under undue pressure or compulsion to complete the transaction. Fair market
value shall be determined by the Board of Directors of the Borrower acting
reasonably and in good faith.

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

 18
 

 

 

“Fee
Letter” means that certain Fee Letter dated as of May 26, 2006, by and
among the Borrower, the Agent, Credit Suisse Securities (USA) LLC, Bank of
America, N.A. and Banc of America Securities LLC.

“Fees”
means the Commitment Fees, the Agent Fees, the L/C Participation Fees and the
Issuing Bank Fees.

“Financial
Officer” means the chief financial officer, treasurer or controller of the
Borrower.

“Foreign
Lender” means a person that is not a “United States person” within the
meaning of Section 7701(a)(30) of the Code.

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

“Foreign
Subsidiary” means, with respect to any Person, any Restricted Subsidiary of
such Person that is not organized or existing under the laws of the United
States of America, any state thereof, the District of Columbia, or any territory
thereof.

“Funded
Debt” means all Indebtedness of the Borrower and its Restricted
Subsidiaries for borrowed money that matures more than one year from the date
of its creation or matures within one year from such date that is renewable or
extendable, at the option of such Person, to a date more than one year from
such date or arises under a revolving credit or similar agreement that
obligates the lender or lenders to extend credit during a period of more than
one year from such date, including Indebtedness in respect of the Loans.

“GAAP”
means generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board or in such other statements by such other entity as
may be approved by a significant segment of the accounting profession of the
United States of America, (a) except as otherwise expressly provided in
this Agreement, as in effect as of the Closing Date, (b) with respect to
all financial statements and reports required to be delivered under the Loan
Documents, as in effect from time to time, and (c) solely with respect to
computations of the financial covenant contained in Section 6.14(a) and
the computation of the Consolidated Leverage Ratio, as in effect from time to
time but subject to the proviso in Section 1.05.

“Governmental
Authority” means the government of the United States of America, 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.

“guarantee”
means a guarantee (other than by endorsement of negotiable instruments for
collection in the ordinary course of business), direct or indirect, in any
manner (including letters of credit and reimbursement agreements in respect
thereof), of all or any part of any Indebtedness or other obligations, and,
when used as a verb, shall have a corresponding meaning.

“Guarantee”
means:

(1) 
the guarantee of the Obligations by Holdings and the Domestic Restricted
Subsidiaries of the Borrower in accordance with the terms of the Loan
Documents; and

 19
 

 

 

(2) 
the guarantee of the Obligations by any Restricted Subsidiary required under
the terms of Section 6.09.

“Guarantee
and Collateral Agreement” means that certain Guarantee and Collateral
Agreement, dated as of the date hereof, between the Loan Parties and the Agent,
for the benefit of the Agent and the other Secured Parties.

“Guarantor”
means Holdings and the Subsidiary Guarantors.

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

“Hedge
Agreement” means any agreement with
respect to any Derivative Transaction between the Borrower or any Subsidiary
and any other Person.

“Hedging Agreement” means any
agreement with respect to the hedging of price risk associated with the
purchase of commodities used in the business of the Borrower and its Restricted
Subsidiaries, so long as any such agreement has been entered into in the
ordinary course of business and not for purposes of speculation.

“Hedging Obligations” means,
with respect to any Person, the obligations of such Person under currency
exchange, interest rate or commodity swap agreements, currency exchange,
interest rate or commodity cap agreements and currency exchange, interest rate
or commodity collar agreements and other agreements or arrangements, in each
case designed to protect such Person against fluctuations in currency exchange,
interest rates or commodity prices.

“Holdings”
has the meaning assigned to such term in the preamble to this Agreement.

“Immaterial
Subsidiary” means, at any date of determination, any Restricted Subsidiary
designated as such in writing by the Borrower that (i) contributed 2.5% or
less of Consolidated EBITDA of the Borrower and the Restricted Subsidiaries for
the period of four fiscal quarters most recently ended more than forty-five
(45) days prior to the date of determination and (ii) had consolidated
assets representing 2.5% or less of Total Assets on the last day of the most
recent fiscal quarter ended more than forty-five (45) days prior to the date of
determination. The Immaterial Subsidiaries as of the Closing Date are listed on
Schedule 1.01(a).

“Incremental
Revolving Credit Lender” shall mean a Lender with an Incremental Revolving
Credit Commitment or an outstanding Incremental Revolving Credit Loan.

“Incremental
Revolving Credit Amount” shall mean, at any time, the excess, if any, of (a) $250,000,000
over (b) the aggregate amount of all Incremental Revolving Credit
Commitments and Incremental Term Loan Commitments established prior to such
time pursuant to Section  2.24.

“Incremental
Revolving Credit Assumption Agreement” shall mean an Incremental Revolving
Credit Assumption Agreement in form and substance reasonably satisfactory to
the Agent, among the Borrower, the Agent and one or more Incremental Revolving
Credit Lenders.

“Incremental
Revolving Credit Commitment” shall mean the commitment of any Lender,
established pursuant to Section 2.24, to make Incremental Revolving Loans
to the Borrower.

 

 20

 

“Incremental
Revolving Credit Exposure” shall mean, with respect to any Lender at any
time, the aggregate principal amount at such time of all outstanding
Incremental Revolving Loans of such Lender.

“Incremental
Revolving Credit Maturity Date” shall mean the final maturity date of any
Incremental Revolving Loan, as set forth in the applicable Incremental
Revolving Credit Assumption Agreement.

“Incremental
Revolving Loans” shall mean Revolving Loans made by one or more Lenders to
the Borrower pursuant to Section 2.01(b). Incremental Revolving Loans may
be made in the form of additional Revolving Loans or, to the extent permitted
by Section 2.24 and provided for in the relevant Incremental Revolving
Credit Assumption Agreement, Other Revolving Loans.

“Incremental
Term Lender” shall mean a Lender with an Incremental Term Loan Commitment
or an outstanding Incremental Term Loan.

“Incremental
Term Loan Amount” shall mean, at any time, the excess, if any, of (a) $250,000,000
over (b) the aggregate amount of all Incremental Revolving Credit
Commitments and Incremental Term Loan Commitments established prior to such
time pursuant to Section  2.24.

“Incremental
Term Loan Assumption Agreement” shall mean an Incremental Term Loan
Assumption Agreement in form and substance reasonably satisfactory to the
Agent, among the Borrower, the Agent and one or more Incremental Term Lenders.

“Incremental
Term Loan Commitment” shall mean the commitment of any Lender, established
pursuant to Section 2.24, to make Incremental Term Loans to the Borrower.

“Incremental
Term Loan Maturity Date” shall mean the final maturity date of any
Incremental Term Loan, as set forth in the applicable Incremental Term Loan
Assumption Agreement.

“Incremental
Term Loan Repayment Dates” shall mean the dates scheduled for the repayment
of principal of any Incremental Term Loan, as set forth in the applicable
Incremental Term Loan Assumption Agreement.

“Incremental
Term Loans” shall mean Term Loans made by one or more Lenders to the
Borrower pursuant to Section 2.01(c). Incremental Term Loans may be made
in the form of additional Term Loans or, to the extent permitted by Section 2.24
and provided for in the relevant Incremental Term Loan Assumption Agreement,
Other Term Loans.

“incur”
has the meaning set forth in Section 6.01.

“Indebtedness”
means with respect to any Person, without duplication:

(1) 
all obligations of such Person for borrowed money;

(2) 
all obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments;

(3) 
all Capitalized Lease Obligations of such Person;

(4) 
all obligations of such Person issued or assumed as the deferred purchase price
of property, all conditional sale obligations and all obligations under any
title retention agreement (but excluding trade accounts payable and other
accrued liabilities arising in the ordinary course of business);

 21
 

 

 

(5) 
all obligations for the reimbursement of any obligor on any letter of credit,
banker’s acceptance or similar credit transaction;

(6) 
guarantees and other contingent obligations in respect of Indebtedness referred
to in clauses (1) through (5) above and clause (8) below;

(7) 
all obligations of any other Person of the type referred to in clauses (1) through
(6) which are secured by any Lien on any property or asset of such Person,
the amount of such obligation being deemed to be the lesser of the fair market
value of such property or asset and the amount of the obligation so secured;

(8) 
all obligations under Currency Agreements and interest swap agreements of such
Person; and

(9) 
all Disqualified Capital Stock issued by such Person with the amount of
Indebtedness represented by such Disqualified Capital Stock being equal to the
greater of its voluntary or involuntary liquidation preference and its maximum
fixed repurchase price, but excluding accrued dividends, if any.

Notwithstanding the foregoing, in connection with the
purchase by the Borrower or any Restricted Subsidiary of any business, the term
“Indebtedness” will exclude post-closing payment adjustments to which the
seller may become entitled to the extent such payment is determined by a final
closing balance sheet or such payment depends on the performance of such
business after the closing; provided, however, that, at the time of closing,
the amount of any such payment is not determinable and, to the extent such
payment thereafter becomes fixed and determined, the amount is paid within
60 days thereafter. For clarification purposes, the liability of the
Borrower or any Restricted Subsidiary to make periodic payments to licensors in
consideration for the license of patents and technical information under
license agreements in existence on the Closing Date and any amount payable in
respect of a settlement of disputes with respect to such payments thereunder shall
not constitute Indebtedness.

For purposes hereof, the “maximum fixed repurchase
price” of any Disqualified Capital Stock which does not have a fixed repurchase
price shall be calculated in accordance with the terms of such Disqualified
Capital Stock as if such Disqualified Capital Stock were purchased on any date
on which Indebtedness shall be required to be determined pursuant to this
Agreement, and if such price is based upon, or measured by, the fair market
value of such Disqualified Capital Stock, such fair market value shall be
determined reasonably and in good faith by the Board of Directors of the issuer
of such Disqualified Capital Stock.

“Indemnified
Taxes” means Taxes other than Excluded Taxes.

“Information”
has the meaning set forth in Section 3.11(a).

“Information
Memorandum” means the Confidential Information Memorandum dated June 2006,
relating to the Borrower and the Transactions.

“Interest
Election Request” means a request by the Borrower to convert or continue a
Borrowing in accordance with Section 2.05.

“Interest
Payment Date” means (a) with respect to any ABR Loan (including a
Swingline Loan), the last Business Day of each March, June, September and December and
the Maturity Date and (b) with respect to any LIBOR Rate Loan, the last
day of the Interest Period applicable to the Borrowing of which such Loan is a
part and, in the case of a LIBOR Rate Borrowing with an Interest Period of more
than three months’ duration, each day prior to the last day of such Interest
Period that occurs at intervals

 22
 

 

 

of three months’ duration after the first day of such
Interest Period (or if such day is not a Business Day, the next succeeding
Business Day).

“Interest
Period” means with respect to any LIBOR Rate Borrowing, the period
commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is one, two, three or
six months (or, to the extent available to each Lender, nine or twelve
months) thereafter, as the Borrower may elect; provided, that (i) if
any Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day and (ii) any
Interest Period that commences on the last Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of
the last calendar month of such Interest Period. For purposes hereof, the date
of a Borrowing initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.

“Interest
Swap Obligations” means the obligations of any Person pursuant to any
arrangement with any other Person, whereby directly or indirectly, such Person
is entitled to receive from time to time periodic payments calculated by
applying either a floating or a fixed rate of interest on a stated notional
amount in exchange for periodic payments made by such other Person calculated
by applying a fixed or a floating rate of interest on the same notional amount
and shall include, without limitation, interest rate swaps, caps, floors,
collars and similar agreements.

“Investments”
means, with respect to any Person, any direct or indirect loan or other
extension of credit (including, without limitation, a guarantee) or capital
contribution to (by means of any transfer of cash or other property to others
or any payment for property or services for the account or use of others), or
any purchase or acquisition by such Person of any Capital Stock, bonds, notes,
debentures or other securities or evidences of Indebtedness issued by, any
Person. “Investment” shall exclude extensions of trade credit by the Borrower
and its Restricted Subsidiaries in accordance with normal trade practices of
the Borrower or such Restricted Subsidiary, as the case may be. Except as
otherwise provided herein, the amount of an Investment shall be its fair market
value at the time the Investment is made and without giving effect to
subsequent changes in its fair market value.

“Issuing
Bank” shall mean, as the context may require, (a) Credit Suisse, in
its capacity as the issuer of Letters of Credit hereunder, and (b) any
other Lender that may become an Issuing Bank pursuant to Section 2.23(i) or
2.23(k), with respect to Letters of Credit issued by such Lender. The Issuing
Bank may, in its discretion, arrange for one or more Letters of Credit to be
issued by Affiliates of the Issuing Bank, in which case the term “Issuing Bank”
shall include any such Affiliate with respect to Letters of Credit issued by
such Affiliate.

“Issuing
Bank Fees” has the meaning assigned to such term in Section 2.10(c).

“Joinder
Agreement” has the meaning assigned to such term in Section 5.11.

“Joint
Lead Arrangers” means Credit Suisse Securities (USA) LLC and Banc of
America Securities LLC.

“L/C
Commitment” shall mean the commitment of the Issuing Bank to issue Letters
of Credit pursuant to Section 2.23.

“L/C
Disbursement” shall mean a payment or disbursement made by the Issuing Bank
pursuant to a Letter of Credit.

 23
 

 

 

“L/C
Exposure” shall mean at any time the sum of (a) the aggregate undrawn
amount of all outstanding Letters of Credit at such time and (b) the
aggregate principal amount of all L/C Disbursements that have not yet been
reimbursed at such time. The L/C Exposure of any Revolving Credit Lender at any
time shall equal its Pro Rata Percentage of the aggregate L/C Exposure at such
time.

“L/C
Participation Fee” has the meaning assigned to such term in Section 2.10(c).

“Lenders”
means the Persons listed on the Commitment Schedule and any other Person
that shall have become a party hereto pursuant to an Assignment and Assumption,
other than any such Person that ceases to be a party hereto pursuant to an
Assignment and Assumption. Unless the context clearly indicates otherwise, the
term “Lenders” shall include the Swingline Lender.

“Letter
of Credit” means any letter of credit or bank guarantee issued or deemed
issued pursuant to Section 2.23.

“LIBOR
Rate” means, with respect to any Interest Period, (a) the rate per
annum determined by the Agent at approximately 11:00 a.m. (London time) on
the date that is two Business Days prior to the commencement of such Interest
Period by reference to the British Bankers’ Association Interest Settlement
Rates for deposits in dollars (as set forth by any service selected by the
Agent that has been nominated by the British Bankers’ Association as an
authorized information vendor for the purpose of displaying such rates) for a
period equal to such Interest Period; provided that, to the extent that
an interest rate is not ascertainable pursuant to the foregoing provisions of
this definition, the “LIBOR Rate” shall be the interest rate per annum
determined by the Agent to be the average of the rates per annum at which
deposits in dollars are offered for such relevant Interest Period to major
banks in the London interbank market in London, England by the Agent at
approximately 11:00 a.m. (London time) on the date that is two Business
Days prior to the beginning of such Interest Period.

“Lien”
means any lien, mortgage, deed of trust, pledge, security interest, charge or
encumbrance of any kind (including any conditional sale or other title
retention agreement, any lease in the nature thereof and any agreement to give
any security interest).

“Loan
Documents” means this Agreement, any promissory notes issued pursuant to
the Agreement, the Collateral Documents. Any reference in this Agreement or any
other Loan Document to a Loan Document shall include all appendices, exhibits
or schedules thereto, and all amendments, restatements, supplements or other
modifications thereto.

“Loan
Guarantor” means each Loan Party (other than the Borrower).

“Loan
Parties” means Holdings, the Borrower, each Domestic Subsidiary (other than
(i) subject to compliance with Section 5.11, any Domestic Subsidiary
that is an Immaterial Subsidiary and (ii) any Unrestricted Subsidiary),
and any other Person who becomes a party to this Agreement as a Loan Party
pursuant to a Joinder Agreement or becomes a party to the Guarantee and
Collateral Agreement as a guarantor and/or grantor thereunder, and their
respective successors and assigns.

“Loans”
means the Revolving Loans, the Term Loans and the Swingline Loans.

“Margin
Stock” shall have the meaning assigned to such term in Regulation U.

“Marketable
Securities” means publicly traded debt or equity securities that are listed
for trading on a national securities exchange and that were issued by a
corporation whose debt securities are rated in one of the three highest rating
categories by either S&P or Moody’s.

 24
 

 

 

“Material
Adverse Effect” means a material adverse effect on (a) the business,
assets, liabilities, results of operations or condition (financial or
otherwise) of the Borrower and the Subsidiaries taken as a whole, (b) the
ability of the Borrower and the other Loan Parties (taken as a whole) to
perform their obligations under the Loan Documents or (c) the rights of,
or remedies available to the Agent or the Lenders under, the Loan Documents.

“Material
Indebtedness” means Indebtedness (other than the Loans) for borrowed money
(including notes, bonds and other similar instruments) of any one or more of
the Borrower and its Subsidiaries in an aggregate principal amount exceeding
$20,000,000.

“Moody’s”
means Moody’s Investors Service, Inc. and any successor to its rating
agency business.

“Mortgaged
Properties” means, initially, the owned real properties of the Loan Parties
specified on Schedule 1.01(b), and shall include each other parcel
of real property and improvements thereto with respect to which a Mortgage is
granted pursuant to Section 5.11.

“Mortgages”
means any mortgage, deed of trust or other agreement which conveys or evidences
a Lien in favor of the Agent, for the benefit of the Agent and the Lenders, on
real property of a Loan Party, including any amendment, modification or
supplement thereto.

“Multiemployer
Plan” means a multiemployer plan as defined in Section 3(37) or
4001(a)(3) of ERISA.

“Net Cash Proceeds”
means, with respect to any Asset Sale, the proceeds in the form of cash or Cash
Equivalents including payments in respect of deferred payment obligations when
received in the form of cash or Cash Equivalents (other than the portion of any
such deferred payment constituting interest) received by the Borrower or any of
its Restricted Subsidiaries from such Asset Sale net of:

(1) 
reasonable out-of-pocket expenses and fees relating to such Asset Sale
(including, without limitation, legal, accounting and investment banking fees
and sales commissions and title and recording tax expenses);

(2) 
all Federal, state, provincial, foreign and local taxes required to be accrued
as a liability under GAAP, as a consequence of such Asset Sale;

(3) 
appropriate amounts to be provided by the Borrower or any Restricted
Subsidiary, as the case may be, as a reserve, in accordance with GAAP against
any liabilities associated with such Asset Sale and retained by the Borrower or
any Restricted Subsidiary, as the case may be, after such Asset Sale,
including, without limitation, pension and other post-employment benefit
liabilities, liabilities related to environmental matters and liabilities under
any indemnification obligations associated with such Asset Sale;

(4) 
all distributions and other payments required to be made to minority interest
holders in Restricted Subsidiaries as a result of such Asset Sale; and

(5) 
all payments made on any Indebtedness which is secured by any assets subject to
such Asset Sale, in accordance with the terms of any Lien upon or other
security agreement of any kind with respect to such assets, or which must by
its terms, or in order to obtain a necessary consent to such Asset Sale, or by
applicable law, be repaid out of the proceeds from such Asset Sale.

“Non-Consenting Lender” has
the meaning assigned to such term in Section 9.02(e).

 25
 

 

 

“obligations”
means, for purposes of the definition of the term “Indebtedness”, all
obligations for principal, premium, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.

“Obligations”
means all obligations defined as “Obligations” in the Guarantee and Collateral
Agreement and the other Security Documents.

“Offer
to Purchase” means the offer to purchase dated May 25, 2006 relating
to the Tender Offer.

“Officer” means the Chairman of
the Board, the Chief Executive Officer, the Chief Financial Officer, the
President, any Executive Vice President, Senior Vice President or Vice
President, the Treasurer or the Secretary of the Borrower.

“Officers’ Certificate” means
a certificate signed on behalf of the Borrower by two Officers of the Borrower,
one of whom must be the principal executive officer, the principal financial
officer, the president, any vice president, the treasurer or the principal
accounting officer of the Borrower.

“Other
Information” has the meaning assigned to such term in Section 3.11(b).

“Other
Pari Passu Lien Obligations” means (i) any Indebtedness constituting
debt securities incurred pursuant to an indenture with an institutional trustee
or loans incurred in the bank credit market (including institutional investor
participation therein) and (ii) all obligations with respect to such
Indebtedness.

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

“Other
Revolving Loans” shall have the meaning assigned to such term in Section 2.24(a).

“Other
Term Loans” shall have the meaning assigned to such term in Section 2.24(a).

“Participant”
has the meaning assigned to such term in Section 9.04.

“PBGC”
means the Pension Benefit Guaranty Corporation referred to and defined in ERISA
and any successor entity performing similar functions.

“Perfection
Certificate” shall mean a certificate in the form of Exhibit B to the
Guarantee and Collateral Agreement or any other form approved by the Agent.

“Permitted
Business” means any business (including stock or assets) that derives a
majority of its revenues from the business engaged in by the Borrower and its
Restricted Subsidiaries on the Closing Date and/or activities that are
reasonably similar, ancillary or related to, or a reasonable extension,
development or expansion of, the businesses in which the Borrower and its
Restricted Subsidiaries are engaged on the Closing Date.

“Permitted
Group” means any group of investors that is deemed to be a “person” (as
such term is used in Section 13(d)(3) of the Exchange Act) by virtue
of the Stockholders’ Agreement, as the same may be amended, modified or
supplemented from time to time; provided that no single Person (together with
its Affiliates), other than the Permitted Holders and their Related Parties, is
the “beneficial owner” (as such term is used in Section 13(d) of the
Exchange Act), directly or indirectly, of more than

 26
 

 

 

50% of the voting power of the issued and outstanding
Capital Stock of the Borrower or Holdings (as applicable) that is “beneficially
owned” (as defined above) by such group of investors.

“Permitted
Holders” means Warburg Pincus Private Equity VIII, L.P. and its Affiliates
and any general or limited partners of Warburg Pincus Private Equity VIII,
L.P., and TD Group Holdings, LLC and its affiliates and any members of TD Group
Holdings, LLC.

“Permitted
Indebtedness” means, without duplication, each of the following:

(1) 
Indebtedness under the Senior Subordinated Note Documents (other than any
Additional Notes) (as defined in the Senior Subordinated Notes Indenture);

(2) 
Indebtedness created hereunder and under the other Loan Documents; provided
that the amount of Indebtedness permitted to be incurred under the Loan
Documents in accordance with this clause (2) shall be in addition to any
Indebtedness permitted to be incurred pursuant to a credit facility in reliance
on, and in accordance with, clauses (7), (13), (14) and (15) below;

(3) 
other indebtedness of the Borrower and its Restricted Subsidiaries outstanding
on the Closing Date as set forth on Schedule 1.01(d) reduced by the amount
of any scheduled amortization payments or mandatory prepayments when actually
paid or permanent reductions thereon;

(4) 
Interest Swap Obligations of the Borrower or any of its Restricted Subsidiaries
covering Indebtedness of the Borrower or any of its Restricted Subsidiaries; provided
that any Indebtedness to which any such Interest Swap Obligations correspond is
otherwise permitted to be incurred under this Agreement; provided, further,
that such Interest Swap Obligations are entered into, in the judgment of the
Borrower, to protect the Borrower or any of its Restricted Subsidiaries from
fluctuation in interest rates on its outstanding Indebtedness;

(5) 
Indebtedness of the Borrower or any Restricted Subsidiary under Hedging
Agreements and Currency Agreements;

(6) 
the incurrence by the Borrower or any of its Restricted Subsidiaries of
intercompany Indebtedness between or among the Borrower and any such Restricted
Subsidiaries; provided, however, that: (a) if the Borrower is the obligor
on such Indebtedness and the payee is a Restricted Subsidiary that is not a
Guarantor, such Indebtedness is expressly subordinated to the prior payment in
full in cash of all Obligations and (b) (1) any subsequent issuance or
transfer of Capital Stock that results in any such Indebtedness being held by a
Person other than the Borrower or a Restricted Subsidiary thereof and (2) any
sale or other transfer of any such Indebtedness to a Person that is not either
the Borrower or a Restricted Subsidiary thereof (other than by way of granting
a Lien permitted under this Agreement or in connection with the exercise of
remedies by a secured creditor) shall be deemed, in each case, to constitute an
incurrence of such Indebtedness by the Borrower or such Restricted Subsidiary,
as the case may be, that was not permitted by this clause (6);

(7) 
Indebtedness (including Capitalized Lease Obligations) incurred by the Borrower
or any of its Restricted Subsidiaries to finance the purchase, lease or
improvement of property (real or personal) or equipment (whether through the
direct purchase of assets or the Capital Stock of any person owning such
assets) in an aggregate principal amount outstanding not to exceed $10,000,000;

(8) 
Refinancing Indebtedness (other than Refinancing Indebtedness with respect to
Indebtedness incurred pursuant to clause (2) of this definition);

 27
 

 

 

(9) 
guarantees by the Borrower and its Restricted Subsidiaries of each other’s
Indebtedness; provided that such Indebtedness is permitted to be
incurred under this Agreement; provided, further, that in the
event such Indebtedness (other than Acquired Indebtedness) is incurred pursuant
to the Consolidated Fixed Charge Coverage Ratio, such guarantees are by the
Borrower or a Guarantor only;

(10) 
Indebtedness arising from agreements of the Borrower or a Restricted Subsidiary
of the Borrower providing for indemnification, adjustment of purchase price,
earn out or other similar obligations, in each case, incurred or assumed in
connection with the disposition of any business, assets or a Restricted
Subsidiary of the Borrower, other than guarantees of Indebtedness, incurred by
any Person acquiring all or any portion of such business, assets or Restricted
Subsidiary for the purpose of financing such acquisition; provided that the
maximum assumable liability in respect of all such Indebtedness shall at no
time exceed the gross proceeds actually received by the Borrower and its
Restricted Subsidiaries in connection with such disposition;

(11)  obligations in respect of performance and
surety bonds and completion guarantees provided by the Borrower or any
Restricted Subsidiary of the Borrower in the ordinary course of business;

(12)  [Intentionally Omitted];

(13)  Indebtedness incurred by the Borrower or any
of the Guarantors in connection with the acquisition of a Permitted Business;
provided that on the date of the incurrence of such Indebtedness, after giving
effect to the incurrence thereof and the use of proceeds therefrom, either (a) the
Borrower would be permitted to incur at least $1.00 of additional Indebtedness
pursuant to the Consolidated Fixed Charge Coverage Ratio or (b) the
Consolidated Fixed Charge Coverage Ratio of the Borrower would be greater than
the Consolidated Fixed Charge Coverage Ratio of the Borrower immediately prior
to the incurrence of such Indebtedness;

(14)  additional Indebtedness of the Borrower and
the Guarantors (which amount may, but need not, be incurred in whole or in part
under a credit facility) (it being understood that any Indebtedness incurred
pursuant to this clause (14) shall cease to be deemed incurred or
outstanding for purposes of this clause (14) but shall be deemed incurred
pursuant to the first paragraph of Section 6.01 from and after the first
date on which the Borrower or such Restricted Subsidiary could have incurred
such Indebtedness pursuant to the first paragraph of Section 6.01 without
reliance on this clause (14)) in an aggregate principal amount that does
not exceed $75,000,000 at any one time outstanding;

(15)  additional Indebtedness of the Foreign
Restricted Subsidiaries in an aggregate principal amount which (when combined
with the liquidation value of all series of outstanding Permitted Subsidiary
Preferred Stock) does not exceed $15,000,000 at any one time outstanding (which
amount may, but need not, be incurred in whole or in part under a credit
facility) (it being understood that any Indebtedness incurred pursuant to this
clause (15) shall cease to be deemed incurred or outstanding for purposes
of this clause (15) but shall be deemed incurred pursuant to the first
paragraph of Section 6.01 from and after the first date on which the
Borrower or such Restricted Subsidiary could have incurred such Indebtedness
pursuant to the first paragraph of Section 6.01 without reliance on this
clause (15));

(16)  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 in the ordinary course of business; provided, however, that
such Indebtedness is extinguished within five business days of incurrence; and

 28
 

 

 

(17)  Indebtedness of the Borrower or any of its
Restricted Subsidiaries represented by letters of credit for the account of the
Borrower or such Restricted Subsidiary, as the case may be, issued in the
ordinary course of business of the Borrower or such Restricted Subsidiary,
including, without limitation, in order to provide security for workers’
compensation claims or payment obligations in connection with self-insurance or
similar requirements in the ordinary course of business and other Indebtedness
with respect to workers’ compensation claims, self-insurance obligations,
performance, surety and similar bonds and completion guarantees provided by the
Borrower or any Restricted Subsidiary of the Borrower in the ordinary course of
business.

For purposes of determining compliance with Section 6.01,
in the event that an item of Indebtedness meets the criteria of more than one
of the categories of Permitted Indebtedness described in clauses (1) through
(17) above or is entitled to be incurred pursuant to the Consolidated
Fixed Charge Coverage Ratio provisions of such covenant, the Borrower shall, in
its sole discretion, divide and classify (or later redivide and reclassify)
such item of Indebtedness in any manner that complies with such covenant.
Accrual of interest, accretion or amortization of original issue discount, the
payment of interest on any Indebtedness in the form of additional Indebtedness
with the same terms, and the payment of dividends on Disqualified Capital Stock
in the form of additional shares of the same class of Disqualified Capital
Stock will not be deemed to be an incurrence of Indebtedness or an issuance of
Disqualified Capital Stock for purposes of Section 6.01.

“Permitted
Investments” means:

(1)            Investments by the Borrower or any
Restricted Subsidiary of the Borrower in any Restricted Subsidiary of the
Borrower (other than a Restricted Subsidiary of the Borrower in which an
Affiliate of the Borrower that is not a Restricted Subsidiary of the Borrower
holds a minority interest) (whether existing on the Closing Date or created
thereafter) or any other Person (including by means of any transfer of cash or
other property) if as a result of such Investment such other Person shall
become a Restricted Subsidiary of the Borrower (other than a Restricted
Subsidiary of the Borrower in which an Affiliate of the Borrower that is not a
Restricted Subsidiary of the Borrower holds a minority interest) or that will
merge with or consolidate into the Borrower or a Restricted Subsidiary of the
Borrower and Investments in the Borrower by the Borrower or any Restricted
Subsidiary of the Borrower;

(2)            investments in cash and Cash
Equivalents;

(3)            loans and advances (including
payroll, travel and similar advances) to employees and officers of the Borrower
and its Restricted Subsidiaries for bona fide business purposes incurred in the
ordinary course of business or consistent with past practice or to fund such
person’s purchase of Capital Stock of the Borrower or any direct or indirect
parent of the Borrower pursuant to compensatory plans approved by the Board of
Directors in good faith;

(4)            Currency Agreements, Hedging
Agreements and Interest Swap Obligations entered into in the ordinary course of
business and otherwise in compliance with this Agreement;

(5)            Investments in securities of trade
creditors or customers received pursuant to any plan of reorganization or
similar arrangement upon the bankruptcy or insolvency of such trade creditors
or customers or in good faith settlement of delinquent obligations of such
trade creditors or customers;

(6)            Investments made by the Borrower or
its Restricted Subsidiaries as a result of consideration received in connection
with an Asset Sale made in compliance with Section 6.03;

(7)            Investments existing on the Closing
Date;

 29
 

 

 

(8)            accounts receivable created or
acquired in the ordinary course of business;

(9)            guarantees by the Borrower or a
Restricted Subsidiary of the Borrower permitted to be incurred under this
Agreement;

(10)          additional Investments having an
aggregate fair market value, taken together with all other Investments made
pursuant to this clause (10) that are at that time outstanding, not
to exceed the greater of (A) $50,000,000 and (B) 4% of the Borrower’s
Total Assets;

(11)          [Intentionally Omitted];

(12)          Investments the payment for which
consists exclusively of Qualified Capital Stock of the Borrower; and

(13)          any Investment in any Person to the
extent it consists of prepaid expenses, negotiable instruments held for
collection and lease, utility and workers’ compensation, performance and other
similar deposits made in the ordinary course of business.

“Permitted
Liens” means, with respect to any Person:

(a) Liens
created under the Loan Documents;

(b) pledges
or deposits by such Person under workmen’s compensation laws, unemployment
insurance laws or similar legislation, or good faith deposits to secure bids, tenders,
contracts (other than for the payment of Indebtedness) or leases to which such
Person is a party, or deposits to secure public or statutory obligations of
such Person or deposits of cash or U.S. government bonds to secure surety or
appeal bonds to which such Person is a party, or deposits as security for
contested taxes or import duties or for the payment of rent, in each case
incurred in the ordinary course of business;

(c) Liens
imposed by law, such as carriers’, warehousemen’s and mechanics’ Liens and
other similar Liens, in each case, for sums not yet overdue for a period of
more than thirty (30) days or being contested in good faith by appropriate
proceedings or other Liens arising out of judgments or awards against such
Person with respect to which such Person shall then be proceeding with an
appeal or other proceedings for review, if adequate reserves with respect
thereto are maintained on the books of such Person in accordance with GAAP;

(d) Liens
for taxes, assessments or other governmental charges or claims not yet overdue
for a period of more than thirty (30) days or payable or subject to
penalties for nonpayment or which are being contested in good faith by
appropriate proceedings diligently conducted, if adequate reserves with respect
thereto are maintained on the books of such Person in accordance with GAAP;

(e) Liens
in favor of issuers of performance and surety bonds or bid bonds or with
respect to other regulatory requirements or letters of credit issued pursuant
to the request of and for the account of such Person in the ordinary course of
its business;

(f) minor
survey exceptions, minor encumbrances, easements or reservations of, or rights
of others for, licenses, rights-of-way, sewers, electric lines, telegraph and
telephone lines and other similar purposes, or zoning or other restrictions as
to the use of real properties or Liens incidental to the conduct of the
business of such Person or to the ownership of its properties, in each case,
which were not incurred in connection with Indebtedness and which do not in the
aggregate materially impair their use in the operation of the business of such
Person;

 

 30

 

(g) Liens
existing on the Closing Date and set forth on Schedule 1.01(e); provided that
such Liens shall secure only those obligations which they secure on the Closing
Date and any extensions, renewals and replacements thereof permitted hereunder;

(h) Liens on property
or shares of stock of a Person at the time such Person becomes a subsidiary; provided that such
Liens are not created or incurred in connection with, or in contemplation of,
such other Person becoming such a subsidiary; provided, further, that such Liens may not extend to any
other property owned by the Borrower or any Restricted Subsidiary;

(i) Liens
on property at the time the Borrower or a Restricted Subsidiary acquired the
property, including any acquisition by means of a merger or consolidation with
or into the Borrower or any Restricted Subsidiary; provided that such Liens are not created or incurred in
connection with, or in contemplation of, such acquisition; provided, further, that the Liens may not extend to any
other property owned by the Borrower or any Restricted Subsidiary;

(j) Liens
securing Indebtedness or other obligations of a Restricted Subsidiary owing to
the Borrower or another Restricted Subsidiary permitted to be incurred in
accordance with Section 6.01;

(k) Liens
on specific items of inventory or other goods and proceeds of any Person
securing such Person’s obligations in respect of bankers’ acceptances issued or
created for the account of such Person to facilitate the purchase, shipment or
storage of such inventory or other goods;

(l) leases
and subleases granted to others in the ordinary course of business which do not
materially adversely affect the ordinary conduct of the business of the
Borrower or any of the Restricted Subsidiaries and do not secure any
Indebtedness;

(m) Liens
arising from financing statement filings under the UCC or similar state laws
regarding operating leases entered into by the Borrower and its Restricted
Subsidiaries in the ordinary course of business;

(n) Liens
in favor of the Borrower or any Subsidiary Guarantor;

(o) Liens
on inventory or equipment of the Borrower or any Restricted Subsidiary granted
in the ordinary course of business to the Borrower’s client at which such
inventory or equipment is located;

(p) Liens
securing the Secured Obligations;

(q) Liens to secure any
refinancing, refunding, extension, renewal or replacement (or successive
refinancing, refunding, extensions, renewals or replacements) as a whole, or in
part, of any Indebtedness secured by any Lien referred to in clauses (a), (g),
(h), (i), (r) and (aa) of this definition; provided that (x) such new Lien
shall be limited to all or part of the same property that secured the original
Lien (plus improvements on such property), and (y) the Indebtedness
secured by such Lien at such time is not increased to any amount greater than
the sum of (A) the outstanding principal amount or, if greater, committed
amount of the Indebtedness described under clauses (a), (g), (h),
(i), (r) and (aa) of this definition at the time the original Lien became
a Permitted Lien pursuant this Agreement, and (B) an amount necessary to
pay any fees and expenses, including premiums, related to such refinancing,
refunding, extension, renewal or replacement;

 31
 

 

 

(r) Liens
securing Indebtedness permitted to be incurred pursuant to clauses (7), (13),
(14) and (15) of the definition of “Permitted Indebtedness”; provided that (A) Liens
securing Indebtedness permitted to be incurred pursuant to such clause (7) do
not at any time encumber any property other than the property financed by such
Indebtedness and the proceeds and the products thereof, (B) Liens securing
Indebtedness permitted to be incurred pursuant to such clause (13) are solely
on acquired property or the assets of the acquired entity, as the case may be
and (C) Liens securing Indebtedness permitted to be incurred pursuant to
such clause (15) extend only to the assets of Foreign Subsidiaries;

(s) deposits
in the ordinary course of business to secure liability to insurance carriers;

(t) Liens
securing judgments for the payment of money not constituting an Event of
Default under paragraph (h) of Article VII, so long as such Liens are
adequately bonded and any appropriate legal proceedings that may have been duly
initiated for the review of such judgment have not been finally terminated or
the period within which such proceedings may be initiated has not expired;

(u) Liens
in favor of customs and revenue authorities arising as a matter of law to
secure payment of customs duties in connection with the importation of goods in
the ordinary course of business;

(v) Liens
(i) of a collection bank arising under Section 4-210 of the UCC
on items in the course of collection, (ii) attaching to commodity trading
accounts or other commodity brokerage accounts incurred in the ordinary course
of business and (iii) in favor of banking institutions arising as a matter
of law encumbering deposits (including the right of set-off) and which are
within the general parameters customary in the banking industry;

(w) Liens
that are contractual rights of set-off (i) relating to the establishment
of depository relations with banks not given in connection with the issuance of
Indebtedness, (ii) relating to pooled deposit or sweep accounts of the
Borrower or any of its Restricted Subsidiaries to permit satisfaction of
overdraft or similar obligations incurred in the ordinary course of business of
the Borrower and its Restricted Subsidiaries or (iii) relating to purchase
orders and other agreements entered into with customers of the Borrower or any
of its Restricted Subsidiaries in the ordinary course of business;

(x) Liens
encumbering reasonable customary initial deposits and margin deposits and
similar Liens attaching to commodity trading accounts or other brokerage
accounts incurred in the ordinary course of business and not for speculative
purposes;

(y) Liens deemed to
exist in connection with Investments in repurchase agreements permitted under Section 6.01;
provided that such Liens do not extend to any assets
other than those assets that are the subject of such repurchase agreement;

(z) other
Liens securing obligations incurred in the ordinary course of business which
obligations do not exceed $50,000,000 at any one time outstanding;

(aa)
Liens securing Hedging Obligations, so long as the related Indebtedness is, and
is permitted to be pursuant to Section 6.06, secured by a Lien on the same
property securing such Hedging Obligations; and

(bb) other Liens incurred to
secure obligations in respect of any Indebtedness permitted to
be incurred pursuant to Section 6.01; provided that,
at the time of incurrence and after giving

 32
 

 

 

pro forma effect thereto,
the Consolidated Secured Debt Ratio would be no greater than 4.00 to 1.00.

“Permitted
Subsidiary Preferred Stock” means any series of Preferred Stock of a
Foreign Restricted Subsidiary that constitutes Qualified Capital Stock, the
liquidation value of all series of which, when combined with the aggregate
amount of outstanding Indebtedness of the Foreign Restricted Subsidiaries
incurred pursuant to clause (15) of the definition of Permitted
Indebtedness, does not exceed $5,000,000.

“Permitted
Transaction Payments” means, without duplication, the following payments
and distributions: (i)  payments to consummate the Transactions, including
the Closing Date Dividend, (ii) payments required to defease the Existing
Notes in accordance with the terms of the indenture governing those notes and (iii) the
payment of fees and expenses relating to the Transactions.

“Person”
means an individual, partnership, corporation, limited liability company,
unincorporated organization, trust or joint venture, or a governmental agency
or political subdivision thereof.

“Plan”
means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the
Code or Section 302 of ERISA, and in respect of which the Borrower or any
ERISA Affiliate is (or, if such plan were terminated, would under Section 4069
of ERISA be deemed to be) an “employer” as defined in Section 3(5) of
ERISA.

“Preferred
Stock” of any Person means any Capital Stock of such Person that has
preferential rights to any other Capital Stock of such Person with respect to
dividends or redemptions or upon liquidation.

“Prime
Rate” means the rate of interest per annum determined from time to time by
Credit Suisse as its prime rate in effect at its principal office in
New York City and notified to the Borrower.

“Productive
Assets” means assets (including Capital Stock) that are used or usable by
the Borrower and its Restricted Subsidiaries in Permitted Businesses

“Projections”
means the projections of the Borrower and the Subsidiaries included in the
Information Memorandum and any other projections and any forward-looking
statements of such entities furnished to the Lenders or the Agent by or on
behalf of Holdings, the Borrower or any of the Subsidiaries prior to the
Closing Date.

“Pro Forma Compliance”
shall mean, at any date of determination, that the Borrower shall be in pro
forma compliance with the covenant set forth in Section 6.14(a) as of
the date of such determination or the last day of the most recent fiscal
quarter-end, as the case may be (computed on the basis of (a) balance
sheet amounts as of such date and (b) income statement amounts for the
most recently completed period of four consecutive fiscal quarters for which
financial statements shall have been delivered to the Agent and calculated in
each case with such pro forma adjustments to Consolidated Total Indebtedness
and Consolidated EBITDA as are appropriate and consistent with the pro forma
adjustment provisions set forth in the definition of “Consolidated Fixed Charge
Coverage Ratio.

“Pro
Rata Percentage” of any Revolving Credit Lender at any time means the
percentage of the Total Revolving Credit Commitment represented by such Lender’s
Revolving Credit Commitment. In the event the Revolving Credit Commitment shall
have expired or been terminated, the Pro Rata Percentage shall be determined on
the basis of the Revolving Credit Commitments most recently in effect.

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“Qualified
Capital Stock” means any Capital Stock that is not Disqualified Capital
Stock.

“Qualified Proceeds” means
assets that are used or useful in, or Capital Stock of any Person engaged in, a
Permitted Business; provided that the fair market value of any such assets or
Capital Stock shall be determined by the Board of Directors of the Borrower in
good faith.

“Refinance”
means, in respect of any security or Indebtedness, to refinance, extend, renew,
refund, repay, prepay, redeem, defease or retire, or to issue a security or
Indebtedness in exchange or replacement for, such security or Indebtedness in
whole or in part. “Refinanced” and “Refinancing” shall have
correlative meanings.

“Refinancing
Indebtedness” means any Refinancing, modification, replacement,
restatement, refunding, deferral, extension, substitution, supplement,
reissuance or resale of existing or future Indebtedness (other than
intercompany Indebtedness), including any additional Indebtedness incurred to
pay interest or premiums required by the instruments governing such existing or
future Indebtedness as in effect at the time of issuance thereof (“Required
Premiums”) and fees in connection therewith; provided that any such event
shall not:

(1)            directly or indirectly result in an
increase in the aggregate principal amount of Permitted Indebtedness, except to
the extent such increase is a result of a simultaneous incurrence of additional
Indebtedness:

(a)             to pay Required Premiums and
related fees; or

(b)             otherwise permitted to be incurred
under this Agreement; and

(2)            create Indebtedness with a Weighted
Average Life to Maturity at the time such Indebtedness is incurred that is less
than the Weighted Average Life to Maturity at such time of the Indebtedness
being refinanced, modified, replaced, renewed, restated, refunded, deferred,
extended, substituted, supplemented, reissued or resold.

“Register”
has the meaning assigned to such term in Section 9.04.

“Registration
Rights Agreement” means the Registration Rights Agreement relating to the
Senior Subordinated Notes, dated as of the Closing Date, among the Borrower,
each Subsidiary Guarantor, Credit Suisse Securities (USA) LLC and Banc of
America Securities LLC.

“Regulation
T” means Regulation T of the Board as from time to time in effect and
all official rulings and interpretations thereunder or thereof, and any
successor provision thereto.

“Regulation
U” means Regulation U of the Board as from time to time in effect and
all official rulings and interpretations thereunder or thereof, and any
successor provision thereto.

“Regulation X”
means Regulation X of the Board as from time to time in effect and all
official rulings and interpretations thereunder or thereof, and any successor
provision thereto.

“Related
Parties” means:

(1) 
with respect to any Permitted Holder:

(a)

(i) 
any spouse, sibling, parent or child of such Permitted Holder; or

 34
 

 

 

(ii) 
the estate of any Permitted Holder during any period in which such estate holds
Capital Stock of the Borrower for the benefit of any Person referred to in
clause (1)(a)(i); or

(b) 
any trust, corporation, partnership, limited liability company or other entity,
the beneficiaries, stockholders, partners, owners or Persons beneficially
owning an interest of more than 50% of which consist of, or the sole managing
partner or managing member of which is, one or more Permitted Holders and/or
such other Persons referred to in the immediately preceding clause (a);

(2) 
with respect to any other specified Person, such Person’s Affiliates and the
respective directors, officers, trustees, employees, agents and advisors of
such Person and such Person’s Affiliates.

“Required
Lenders” means at any time, Lenders have Loans (excluding Swingline Loans),
L/C Exposure, Swingline Exposure and unused Revolving Credit Commitments and
Term Loan Commitments representing more than 50% of the sum of all Loans
outstanding (excluding Swingline Loans), L/C Exposure, Swingline Exposure and
unused Revolving Credit Commitments and Term Loan Commitments at such time.

“Required
Revolving Lenders” has the meaning assigned to such term in Section 9.02(b).

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

“Responsible
Officer” of any Person means the chief executive officer, the president,
any vice president, the chief operating officer or any Financial Officer of
such Person and any other officer or similar official thereof responsible for
the administration of the obligations of such Person in respect of this
Agreement, and, as to any document delivered on the Closing Date (but subject
to the express requirements set forth in Section 4.02), shall include any
secretary or assistant secretary of a Loan Party. Any document delivered
hereunder that is signed by a Responsible Officer of a Loan Party shall be
conclusively presumed to have been authorized by all necessary corporate,
partnership and/or other action on the part of such Loan Party and such
Responsible Officer shall be conclusively presumed to have acted on behalf of
such Loan Party.

“Restricted
Payments” has the meaning assigned to such term in Section 6.02.

“Restricted Subsidiary” of
any Person means any Subsidiary of such Person which at the time of
determination is not an Unrestricted Subsidiary.

“Revolving
Credit Borrowing” means a Borrowing comprised of Revolving Loans or
Incremental Revolving Loans.

“Revolving
Credit Commitment” means (a) with respect to each Lender, the
commitment of such Lender to make Revolving Loans hereunder as set forth in the
Commitment Schedule or in the most recent Assignment and Assumption
executed by such Lender, as applicable, as the same may be (i) reduced
from time to time pursuant to Section 2.06 and (ii) reduced or
increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 9.04 and (b) any Incremental Revolving Credit
Commitment.

 35
 

 

 

“Revolving
Credit Exposure” means, with respect to any Lender at any time, the
aggregate principal amount at such time of all outstanding Revolving Loans of
such Lender, plus the aggregate amount at such
time of such Lender’s L/C Exposure, plus the aggregate amount at such
time of such Lender’s Swingline Exposure.

“Revolving
Credit Lender” means a Lender with a Revolving Credit Commitment or an
outstanding Revolving Credit Loan.

“Revolving
Credit Maturity Date” means June 23, 2012.

“Revolving
Loans” means the revolving loans made by the Lenders to the Borrower
pursuant to clause (a)(ii) of Section 2.01. Unless the context shall
otherwise require, the term “Revolving Loans” shall include Incremental
Revolving Loans.

“Sale
and Lease-Back Transaction” means any direct or indirect arrangement with
any Person or to which any such Person is a party providing for the leasing to
the Borrower or a Restricted Subsidiary of any property, whether owned by the
Borrower or any Restricted Subsidiary at the Closing Date or later acquired,
which has been or is to be sold or transferred by the Borrower or such
Restricted Subsidiary to such Person or to any other Person from whom funds
have been or are to be advanced by such Person on the security of such
property.

“S&P”
means Standard & Poor’s Ratings Service, a division of the McGraw-Hill
Companies, Inc., and any successor to its rating agency business.

“SEC”
means the Securities and Exchange Commission, or any Governmental Authority
succeeding to any or all of its functions.

“Secured
Hedging Obligations” means all Hedging Obligations owing to the Agent, a
Joint Lead Arranger or a co-arranger, a Lender or any Affiliate of any of the
foregoing and with respect to which, at or prior to the time that the Hedge
Agreement relating to such Hedging Obligation is entered into, the Borrower (or
another Loan Party) and the Lender or other Person referred to above in this
definition (or Affiliate) party thereto (except in the case of the Agent) shall
have delivered written notice to the Agent that such a transaction has been
entered into and that it constitutes a Secured Hedging Obligation entitled to
the benefits of the Collateral Documents.

“Secured Debt” means any Indebtedness
secured by a Lien.

“Secured
Obligations” means all Obligations, together with all Secured Hedging
Obligations.

“Secured
Parties” has the meaning assigned to such term in the Guarantee and
Collateral Agreement.

“Securities
Act” means the Securities Act of 1933, as amended.

“Senior
Debt” means the principal
of, premium, if any, and interest (including any interest accruing subsequent
to the filing of a petition of bankruptcy at the rate provided for in the
documentation with respect thereto, whether or not such interest is an allowed
claim under applicable law) on any Indebtedness of the Borrower, Holdings or
any Guarantor, whether outstanding on the Closing Date or thereafter created,
incurred or assumed, unless, in the case of any particular Indebtedness, the
instrument creating or evidencing the same or pursuant to which the same is
outstanding expressly provides that such Indebtedness shall be subordinate in
right of payment to the Obligations or the

 

 36
 

 

 

Guarantees, as the case may be. Without limiting the
generality of the foregoing, “Senior Debt” shall also include the principal of,
premium, if any, interest (including any interest accruing subsequent to the
filing of a petition of bankruptcy at the rate provided for in the
documentation with respect thereto, whether or not such interest is an allowed
claim under applicable law) on, and all other amounts owing in respect of:

(x) 
all monetary obligations of every nature of the Borrower, Holdings or any
Guarantor under this Agreement, including, without limitation, obligations to
pay principal and interest, reimbursement obligations under letters of credit,
fees, expenses and indemnities;

(y) 
all Interest Swap Obligations (and guarantees thereof); and

(z) 
all obligations (and guarantees thereof) under Currency Agreements and Hedging
Agreements, in each case whether outstanding on the Closing Date or thereafter
incurred.

Notwithstanding the foregoing, “Senior Debt” shall not
include:

(i) 
any Indebtedness of the Borrower, Holdings or a Guarantor to the Borrower or to
a Subsidiary of the Borrower;

(ii) 
any Indebtedness of the Borrower, Holdings or any Guarantor to, or guaranteed
by the Borrower, Holdings or any Guarantor on behalf of, any shareholder,
director, officer or employee of the Borrower, Holdings or any Subsidiary of
the Borrower (including, without limitation, amounts owed for compensation)
other than a shareholder who is also a lender (or an Affiliate of a lender)
under the Credit Facilities (including the Credit Facility);

(iii) 
any amounts payable or other liability to trade creditors arising in the
ordinary course of business (including guarantees thereof or instruments
evidencing such liabilities but excluding secured purchase money obligations);

(iv) 
Indebtedness represented by Disqualified Capital Stock;

(v) 
any liability for Federal, state, local or other taxes owed or owing by the
Borrower, any of the Guarantors or Holdings;

(vi) 
that portion of any Indebtedness incurred in violation of Section 6.01
(but, as to any such obligation, no such violation shall be deemed to exist for
purposes of this clause (vi) if the holder(s) of such obligation
or their representative and the Agent shall have received an officers’
certificate of the Borrower to the effect that the incurrence of such
Indebtedness does not (or in the case of revolving credit indebtedness, that
the incurrence of the entire committed amount thereof at the date on which the
initial borrowing thereunder is made would not) violate such provisions of this
Agreement);

(vii) 
Indebtedness which, when incurred and without respect to any election under Section 1111(b) of
Title 11, United States Code, is without recourse to the Borrower, any of the
Guarantors or Holdings, as applicable; and

(viii) 
any Indebtedness which is, by its express terms, subordinated in right of
payment to any other Indebtedness of the Borrower, any of the Guarantors or
Holdings.

“Senior
Subordinated Notes Indenture” means the Indenture dated as of the date
hereof, among the Borrower, as issuer, Holdings, certain of its subsidiaries,
as guarantors, and The Bank of New York, as trustee, pursuant to which the
Senior Subordinated Notes are issued.

“Senior
Subordinated Notes” means the Borrower’s 7.75% Senior Subordinated Notes
due 2014, in an initial aggregate principal amount of $275,000,000.

 37
 

 

 

“Senior
Subordinated Note Documents” means the Senior Subordinated Notes Indenture
and all other instruments, agreements and other documents evidencing the Senior
Subordinated Notes or providing for any guarantee or other right in respect
thereof.

“Significant Subsidiary” with
respect to any Person, means any Restricted Subsidiary of such Person that
satisfies the criteria for a “significant subsidiary” set forth in Rule 1-02(w) of
Regulation S-X under the Securities Act.

“Sponsor”
means Warburg Pincus LLC and its Affiliates.

“Stockholders’
Agreement” means the Stockholders’ Agreement, dated as of July 22,
2003, among TD Holding Corporation (now known as TransDigm Group Incorporated)
and the other parties named therein.

“Subordinated
Indebtedness” means (a) with respect to the Borrower, any Indebtedness
of the Borrower that is by its terms subordinated in right of payment to the
Obligations, and (b) with respect to any Loan Guarantor, any Indebtedness
of such Loan Guarantor that is by its terms subordinated in right of payment to
the Guarantee of such Loan Guarantor.

“subsidiary”
with respect to any Person, means:

(i) 
any corporation of which the outstanding Capital Stock having at least a
majority of the votes entitled to be cast in the election of directors under
ordinary circumstances shall at the time be owned, directly or indirectly by
such Person; or

(ii) 
any other Person of which at least a majority of the voting interest under
ordinary circumstances is at the time, directly or indirectly, owned by such
Person.

“Subsidiary”
means, unless the context otherwise requires, a Restricted Subsidiary of the
Borrower.

“Subsidiary
Guarantor” means each Restricted Subsidiary of the Borrower that is a Loan
Party and that executes this Agreement and the Guarantee and Collateral
Agreement as a Loan Guarantor on the Closing Date and each other Restricted
Subsidiary of the Borrower that thereafter guarantees the Secured Obligations
pursuant to the terms of this Agreement and the Guarantee and Collateral
Agreement, provided that upon the release and discharge of such Restricted
Subsidiary from its Guarantee in accordance with this Agreement and the
Guarantee and Collateral Agreement, such Restricted Subsidiary shall cease to
be a Subsidiary Guarantor.

“Swingline
Commitment” means the commitment of the Swingline Lender to make loans
pursuant to Section 2.22, as the same may be reduced from time to time
pursuant to Section 2.06 or Section 2.22.

“Swingline
Exposure” means at any time the aggregate principal amount at such time of
all outstanding Swingline Loans. The Swingline Exposure of any Revolving Credit
Lender at any time shall equal its Pro Rata Percentage of the aggregate Swingline
Exposure at such time.

“Swingline
Lender” means Credit Suisse, in its capacity as lender of Swingline Loans
hereunder.

“Swingline
Loan” means any loan made by the Swingline Lender pursuant to Section 2.22.

 38
 

 

 

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

“TD
Finance” means TD Finance Corporation, a Delaware corporation.

“TD
Finance Merger” means the merger of TD Finance with and into the Borrower,
with the Borrower surviving, pursuant to the TD Finance Merger Agreement.

“TD
Finance Merger Agreement” means the Agreement and Plan of Merger dated as
of June 23, 2006, by and between the Borrower and TD Finance.

“Tender
Offer” means the Borrower’s tender offer for all of the Existing Notes
pursuant to the Offer to Purchase.

“Term
Borrowing” means a Borrowing comprised of Term Loans or Incremental Term
Loans.

“Term
Lenders” means those Lenders that have a Term Loan Commitment or an
outstanding Term Loan.

“Term
Loan Commitment” means (a) with respect to each Lender, the commitment
of such Lender to make Term Loans hereunder as set forth in the Commitment
Schedule or in the most recent Assignment and Assumption executed by such
Lender, as applicable, as the same may be (i) reduced from time to time
pursuant to Section 2.06 and (ii) reduced or increased from time to
time pursuant to assignments by or to such Lender pursuant to Section 9.04
and (b) any Incremental Term Loan Commitment.

“Term
Loan Maturity Date” means June 23, 2013.

“Term
Loans” means the term loans made by the Lenders to the Borrower pursuant to
clause (a)(i) of Section 2.01. Unless the context shall otherwise
require, the term “Term Loans” shall include Incremental Term Loans.

“Title
Insurance Company” means the title insurance company providing the Title
Insurance Policies.

“Title
Insurance Policies” means the lender’s title insurance policies issued to
Agent with respect to the Mortgaged Properties.

“Total Assets”
means, as of any date, the total consolidated assets of the Borrower and its
Restricted Subsidiaries, as set forth on the Borrower’s most recently available
internal consolidated balance sheet as of such date.

“Total
Revolving Credit Commitment” means, at any time, the aggregate amount of
Revolving Credit Commitments, as in effect at such time. The initial Total
Revolving Credit Commitment is $150,000,000.

“Transactions”
means, collectively, (a) the execution, delivery and performance by the
Loan Parties of the Loan Documents to which they are a party and the making of
the Borrowings hereunder, (b) the execution, delivery and performance by
Holdings, the Borrower and the subsidiaries of the Borrower party thereto of
the Senior Subordinated Note Documents and the issuance of the Senior Subordinated
Notes, (c) the Existing Bank Debt Refinancing, (d) the Tender Offer
and (e) the payment of the Permitted Transaction Payments.

 39
 

 

 

“TransDigm
Holdings” means TransDigm Holding Company, a Delaware corporation.

“TransDigm
Holdings Merger” means the merger of TransDigm Holdings with and into the
Borrower, with the Borrower surviving, pursuant to the TransDigm Holdings
Merger Agreement.

“TransDigm
Holdings Merger Agreement” means the Agreement and Plan of Merger dated on
or around June 26, 2006, by and between the Borrower and TransDigm
Holdings.

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

“UCC”
means the Uniform Commercial Code as in effect from time to time in the state
of New York or any other state the laws of which are required to be applied in
connection with the issue of perfection of security interests.

“Unliquidated
Obligations” means, at any time, any Secured Obligations (or portion
thereof) that are contingent in nature or unliquidated at such time, including
any Secured Obligation that is: (i) an obligation to reimburse a bank for
drawings not yet made under a letter of credit issued by it; (ii) any
other obligation (including any guarantee) that is contingent in nature at such
time; or (iii) an obligation to provide collateral to secure any of the
foregoing types of obligations, but excluding unripened or contingent
obligations related to indemnification under Section 9.03 for which no
written demand has been made.

“U.S.
Subsidiary” means any Subsidiary of the Borrower that is incorporated under
the laws of the United States of America or any State thereof or the District
of Columbia.

“Unrestricted
Subsidiary” of any Person means:

(1) 
any Subsidiary of such Person that at the time of determination shall be or
continue to be designated an Unrestricted Subsidiary by the Board of Directors
of such Person in the manner provided below; and

(2) 
any Subsidiary of an Unrestricted Subsidiary.

The Board of Directors of the Borrower may designate
any Subsidiary (including any newly acquired or newly formed Subsidiary) to be
an Unrestricted Subsidiary unless such Subsidiary owns any Capital Stock of, or
owns or holds any Lien on any property of, the Borrower or any other Subsidiary
of the Borrower that is not a Subsidiary of the Subsidiary to be so designated
or another Unrestricted Subsidiary; provided that:

(1) 
the Borrower certifies to the Agent that such designation complies with the “Limitation
on Restricted Payments” covenant; and

(2) 
each Subsidiary to be so designated and each of its Subsidiaries has not at the
time of designation, and does not thereafter, create, incur, issue, assume,
guarantee or otherwise become directly or indirectly liable with respect to any
Indebtedness pursuant to which the lender has recourse to any of the assets of
the Borrower or any of its Restricted Subsidiaries.

The Board of Directors of the Borrower may designate
any Unrestricted Subsidiary to be a Restricted Subsidiary only if (x) immediately
after giving effect to such designation, the Borrower is able to incur at least
$1.00 of additional Indebtedness (other than Permitted Indebtedness) in
compliance with Section 6.01 and (y) immediately before and
immediately after giving effect to such designation, no Default or Event of
Default shall have occurred and be continuing. Any such designation by the
Board of Directors

 

 40

 

 

of the Borrower shall be evidenced by a Board
Resolution giving effect to such designation and an officers’ certificate
certifying that such designation complied with the foregoing provisions.

Actions taken by an Unrestricted Subsidiary will not
be deemed to have been taken, directly or indirectly, by the Borrower or any
Restricted Subsidiary.

Notwithstanding the foregoing, as of the Closing Date,
all of the subsidiaries of the Borrower will be Restricted Subsidiaries.

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

“Voting Stock” of any Person as of any
date means the Capital Stock of such Person that is at the time entitled to
vote in the election of the Board of Directors of such Person.

“Weighted Average Life
to Maturity” means, when applied to any Indebtedness at any date, the
number of years obtained by dividing:

(1)            the then outstanding aggregate
principal amount of such Indebtedness; into

(2)            the sum of the total of the products
obtained by multiplying;

(a)             the amount of each then remaining
installment, sinking fund, serial maturity or other required payment of
principal, including payment at final maturity, in respect thereof; by

(b)            the number of years (calculated to
the nearest one-twelfth) which will elapse between such date and the making of
such payment.

“Wholly-Owned
Subsidiary” of any Person means any Subsidiary of such Person of which all
the outstanding voting securities (other than in the case of a Restricted
Subsidiary that is incorporated in a jurisdiction other than a State in the
United States of America or the District of Columbia, directors’ qualifying
shares or an immaterial amount of shares required to be owned by other Persons
pursuant to applicable law) are owned by such Person or any Wholly Owned
Subsidiary of such Person.

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

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

SECTION 1.03.      Terms
Generally. The definitions of terms herein shall apply equally to the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words “include”, “includes” and “including” shall be deemed
to be followed by the phrase “without limitation”. Unless otherwise
specifically indicated, the term “consolidated” with respect to any Person
refers to such Person consolidated with its Restricted Subsidiaries, and
excludes from such consolidation any Unrestricted Subsidiary as if such
Unrestricted Subsidiary were not an Affiliate of such Person. The word “will”
shall be construed to have the same

 41
 

 

 

meaning and effect as the word “shall”. Unless the
context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any
reference herein to any Person shall be construed to include such Person’s
successors and assigns, (c) the words “herein”, “hereof” and “hereunder”,
and words of similar import, shall be construed to refer to this Agreement in
its entirety and not to any particular provision hereof, (d) all references
herein to Articles, Sections, Exhibits and Schedules shall be construed to
refer to Articles and Sections of, and Exhibits and Schedules to, this
Agreement and (e) the words “asset” and “property” shall be construed to
have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and
contract rights.

SECTION 1.04.      Effectuation of Transactions. Each
of the representations and warranties of the Loan Parties contained in this
Agreement (and all corresponding definitions) are made after giving effect to
the Transactions, unless the context otherwise requires.

SECTION 1.05.      Accounting Terms; GAAP. Except as
otherwise expressly provided herein, all terms of an accounting or financial
nature shall be construed in accordance with GAAP or, if not defined in GAAP
(as determined by the Borrower in good faith) as determined by the Borrower in
good faith, as in effect from time to time; provided that,
to the extent set forth in the definition of “GAAP”, if the Borrower notifies
the Agent that the Borrower requests an amendment to any provision hereof to
eliminate the effect of any change occurring after the date hereof in GAAP or
in the application thereof on the operation of such provision (or if the Agent
notifies the Borrower that the Required Lenders request an amendment to any
provision thereof for such purpose), regardless of whether any such notice is
given before or after such change in GAAP or in the application thereof, then such
provision shall be interpreted on the basis of GAAP as in effect and applied
immediately before such change shall have become effective until such notice
shall have been withdrawn or such provision amended in accordance herewith.

SECTION 1.06.      Designated Senior Debt. The Loans
and other Obligations under the Loan Documents constitute “Designated Senior
Debt”, and this Agreement and the other Loan Documents collectively constitute
the “Credit Facility” for purposes of the Senior Subordinated Note Documents.

ARTICLE II

The Credits

SECTION 2.01.      Commitments.
(a)  Subject to the terms and conditions set forth herein, each Lender
agrees, severally and not jointly, (i) to make a Term Loan to the Borrower
on the Closing Date, in a principal amount not to exceed its Term Loan
Commitment, and (ii) to make Revolving Loans to the Borrower, at any time
and from time to time on or after the Closing Date, and until the earlier of
the Revolving Credit Maturity Date and the termination of the Revolving Credit
Commitment of such Lender in accordance with the terms hereof, in an aggregate
principal amount at any time outstanding that will not result in such Lender’s
Revolving Credit Exposure exceeding such Lender’s Revolving Credit Commitment. Within the
limits set forth in clause (ii) of the preceding sentence and subject to
the terms, conditions and limitations set forth herein, the Borrower may
borrow, pay or prepay and reborrow Revolving Loans. Amounts prepaid or
repaid in respect of Term Loans may not be reborrowed.

(b)  Each Lender having an Incremental
Revolving Credit Commitment hereby agrees, severally and not jointly, on the
terms and subject to the conditions set forth herein and in the applicable
Incremental Revolving Credit Assumption Agreement, to make Incremental
Revolving Loans to the Borrower, in an aggregate principal amount at any time
outstanding that will not result in such Lender’s

 42
 

 

 

Incremental Revolving Credit Exposure exceeding such Lender’s
Incremental Revolving Credit Commitment. Within the limits set forth in the
preceding sentence and subject to the terms, conditions and limitations set
forth herein, the Borrower may borrow, pay or prepay and reborrow Incremental
Revolving Loans.

(c)  Each Lender having an Incremental
Term Loan Commitment hereby agrees, severally and not jointly, on the terms and
subject to the conditions set forth herein and in the applicable Incremental
Term Loan Assumption Agreement, to make Incremental Term Loans to the Borrower,
in an aggregate principal amount not to exceed its Incremental Term Loan
Commitment. Amounts paid or prepaid in respect of Incremental Term Loans may
not be reborrowed.

SECTION 2.02.      Loans
and Borrowings. (a)  Each Loan (other than Swingline Loans) shall be
made as part of a Borrowing consisting of Loans of the same Class and Type
made by the Lenders ratably in accordance with their applicable Commitments. The
failure of any Lender to make any Loan required to be made by it shall not
relieve any other Lender of its obligations hereunder; provided that the
Commitments of the Lenders are several and no Lender shall be responsible for
any other Lender’s failure to make Loans as required. Except for Swingline
Loans and Loans deemed made pursuant to Section 2.02(e), the Loans
comprising any Borrowing shall be in an aggregate principal amount that is (i) (A) in
the case of a Revolving Borrowing, an integral multiple of $1,000,000 and not
less than $1,000,000 (except with respect to any Incremental Revolving Credit
Borrowing, to the extent provided in the related Incremental Revolving Credit
Assumption Agreement) or (B) in the case of a Term Loan Borrowing, an
integral multiple of $1,000,000 and not less than $5,000,000 (except with
respect to any Incremental Term Borrowing, to the extent provided in the
related Incremental Term Loan Assumption Agreement) or (ii) in the case of
any Borrowing, equal to the remaining available balance of the applicable
Commitments.

(b)  Subject to Section 2.12, each
Borrowing shall be comprised entirely of ABR Loans or LIBOR Rate Loans as the
Borrower may request in accordance herewith. Each Lender at its option may make
any LIBOR Rate Loan by causing any domestic or foreign branch or Affiliate of
such Lender to make such Loan; provided that (i) any exercise of such
option shall not affect the obligation of the Borrower to repay such Loan in
accordance with the terms of this Agreement, (ii)in exercising such option,
such Lender shall use reasonable efforts to minimize any increase in the
Adjusted LIBOR Rate or increased costs to the Borrower resulting therefrom
(which obligation of such Lender shall not require it to take, or refrain from
taking, actions that it determines would result in increased costs for which it
will not be compensated hereunder or that it otherwise determines would be
disadvantageous to it and in the event of such request for costs for which
compensation is provided under this Agreement, the provisions of Section 2.13
shall apply) and (iii) such branch or Affiliate of such Lender would not
be included in clause (z) of the first proviso to the definition of the
term “Eligible Assignee” set forth in Section 1.01.

(c)  At the commencement of each
Interest Period for any LIBOR Rate Borrowing, such Borrowing shall comprise an
aggregate principal amount that is an integral multiple of $1,000,000 and not
less than $5,000,000. Each ABR Borrowing when made shall be in a minimum
principal amount of $1,000,000; provided that an ABR Borrowing may be
maintained in a lesser amount equal to the difference between the aggregate
principal amount of all other Borrowings and the total amount of Loans at such
time outstanding. Borrowings of more than one Type may be outstanding at the
same time; provided that there shall not at any time be more than a total of
ten different Interest Periods in effect for LIBOR Rate Borrowings at any time
outstanding.

(d)  Notwithstanding any other provision
of this Agreement, the Borrower shall not be entitled to request, or to elect
to convert or continue, any Borrowing if the Interest Period requested with
respect thereto would end after the Revolving Credit Maturity Date or Term Loan
Maturity Date, as applicable.

 43
 

 

 

(e)  If the Issuing Bank shall not have
received from the Borrower the payment required to be made by Section 2.23(e) within
the time specified in such Section, the Issuing Bank will promptly notify the
Agent of the L/C Disbursement and the Agent will promptly notify each Revolving
Credit Lender of such L/C Disbursement and its Pro Rata Percentage thereof. Each
Revolving Credit Lender shall pay by wire transfer of immediately available
funds to the Agent not later than 2:00 p.m., New York City time, on such
date (or, if such Revolving Credit Lender shall have received such notice later
than 12:00 (noon), New York City time, on any day, not later than 10:00 a.m.,
New York City time, on the immediately following Business Day), an amount equal
to such Lender’s Pro Rata Percentage of such L/C Disbursement (it being
understood that such amount shall be deemed to constitute an ABR Revolving Loan
of such Lender and such payment shall be deemed to have reduced the L/C
Exposure), and the Agent will promptly pay to the Issuing Bank amounts so
received by it from the Revolving Credit Lenders. The Agent will promptly pay
to the Issuing Bank any amounts received by it from the Borrower pursuant to Section 2.23(e) prior
to the time that any Revolving Credit Lender makes any payment pursuant to this
paragraph (e); any such amounts received by the Agent thereafter will be
promptly remitted by the Agent to the Revolving Credit Lenders that shall have
made such payments and to the Issuing Bank, as their interests may appear. If
any Revolving Credit Lender shall not have made its Pro Rata Percentage of such
L/C Disbursement available to the Agent as provided above, such Lender and the
Borrower severally agree to pay interest on such amount, for each day from and
including the date such amount is required to be paid in accordance with this
paragraph to but excluding the date such amount is paid, to the Agent for the
account of the Issuing Bank at (i) in the case of the Borrower, a rate per
annum equal to the interest rate applicable to Revolving Loans pursuant to Section 2.11(a),
and (ii) in the case of such Lender, for the first such day, the Federal
Funds Effective Rate, and for each day thereafter, the Alternate Base Rate.

SECTION 2.03.      Requests
for Borrowing. (a)  In order to request a Borrowing (other than a
Swingline Loan or a deemed Borrowing pursuant to Section 2.02(e), as to
which this Section 2.03 shall not apply), the Borrower shall notify the
Agent of such request either in writing by delivery of a Borrowing Request (by
hand or facsimile) signed by the Borrower or by telephone (to be confirmed
promptly by hand delivery or facsimile of written notice) not later than 11:00 a.m.,
New York City time, (A) in the case of a LIBOR Rate Borrowing, three (3) Business
Days before a proposed Borrowing (or such later time as shall be acceptable to
the Agent) and (B) in the case of an ABR Borrowing, one (1) Business
Day before a proposed Borrowing (or such later time as shall be acceptable to
the Agent). Each such telephonic and written Borrowing Request shall be
irrevocable and shall specify the following information in compliance with Section 2.01:

(i) the
aggregate amount of the requested Borrowing;

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

(iii) whether
the Borrowing then being requested is to be a Term Borrowing, an Incremental
Term Borrowing, a Revolving Credit Borrowing or an Incremental Revolving Credit
Borrowing, and whether such Borrowing is to be an ABR Borrowing or a LIBOR Rate
Borrowing;

(iv) in
the case of a LIBOR Rate Borrowing, the initial Interest Period to be
applicable thereto, which shall be a period contemplated by the definition of
the term “Interest Period”; and

(v) the
location and number of the Borrower’s account to which funds are to be
disbursed.

 44
 

 

 

provided, however, that
notwithstanding any contrary specification in any Borrowing Request, each
requested Borrowing shall comply with the requirements set forth in Section 2.02
and Section 2.04

(b)  If no election as to the Type of
Borrowing is specified, then the requested Borrowing shall be an ABR Borrowing.
If no Interest Period is specified with respect to any LIBOR Rate Borrowing, then
the Borrower shall be deemed to have selected an Interest Period of one month’s
duration. Promptly following receipt of the Borrowing Request in accordance
with this Section, the Agent shall advise each Lender of the details thereof
and of the amount of such Lender’s Loan to be made as part of the requested
Borrowing.

SECTION 2.04.      Funding
of Borrowings. (a)  Except with respect to Swingline Loans and Loans
made pursuant to Section 2.02(e), each Lender shall make each Loan to be
made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 12:00 (noon), New York City time, to the account
of the Agent most recently designated by it for such purpose by notice to the
Lenders.

(b)  Unless the Agent shall have
received notice from a Lender prior to the date of any Borrowing that such
Lender will not make available to the Agent such Lender’s share of such
Borrowing, the Agent may assume that such Lender has made such share available
on the date of such Borrowing in accordance with paragraph (a) of this Section and
may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share
of the Borrowing available to the Agent, then the applicable Lender and the
Borrower severally agree to pay to the Agent forthwith on demand (without
duplication) such corresponding amount with interest thereon, for each day from
and including the date such amount is made available to the Borrower to but
excluding the date of payment to the Agent, at (i) in the case of such
Lender, the greater of the Federal Funds Effective Rate and a rate determined
by the Agent in accordance with banking industry rules on interbank
compensation or (ii) in the case of the Borrower, the interest rate
applicable to ABR Loans. If such Lender pays such amount to the Agent, then
such amount shall constitute such Lender’s Loan as part of such Borrowing for
purposes of this Agreement. Nothing herein shall be deemed to relieve any
Lender from its obligation to fulfill its Commitments or to prejudice any
rights which the Agent or the Borrower or any Loan Party may have against any
Lender as a result of any default by such Lender hereunder.

SECTION 2.05       Type;
Interest Elections. (a)  Loans shall initially be of the Type
specified in the applicable Borrowing Request and, in the case of a LIBOR Rate
Borrowing, shall have an initial Interest Period as specified in such Borrowing
Request. Thereafter, the Borrower may elect to convert all or any portion of
any Borrowing (subject to the minimum amounts for Borrowings of the applicable
Type specified in Section 2.02(c)) to a different Type or to continue such
Borrowing and, in the case of a LIBOR Rate Borrowing, may elect Interest
Periods therefor, all as provided in this Section. The Borrower may elect
different options with respect to different portions of the affected Borrowing,
in which case each such portion shall be allocated ratably among the Lenders
holding the Loans comprising such Borrowing, and the Loans comprising each such
portion shall be considered a separate Borrowing.

(b)  To make an election pursuant to
this Section, the Borrower shall notify the Agent of such election by telephone
(i) in the case of an election to convert to or continue as a LIBOR Rate
Borrowing, not later than 11:00 a.m., New York City time, three (3) Business
Days before the date of the proposed conversion or continuation or (ii) in
the case of an election to convert to or continue as an ABR Borrowing, not
later than 10:00 a.m., New York City time, on the date of the proposed
conversion or continuation. Each such telephonic Interest Election Request
shall be irrevocable and shall be confirmed promptly by hand delivery or
facsimile to the Agent of a written Interest Election Request in a form
approved by the Agent and signed by the Borrower.

 45
 

 

 

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

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

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

(iii) whether
the resulting Borrowing is to be an ABR Borrowing or a LIBOR Rate Borrowing;
and

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

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

(d)  Promptly following receipt of an
Interest Election Request, the Agent shall advise each Lender of the details
thereof and of such Lender’s portion of each resulting Borrowing.

(e)  If the Borrower fails to deliver a
timely Interest Election Request with respect to a LIBOR Rate Borrowing prior
to the end of the Interest Period applicable thereto, then, unless such
Borrowing is repaid as provided herein, at the end of such Interest Period such
Borrowing shall be converted to an ABR Borrowing. Notwithstanding any contrary
provision hereof, if an Event of Default of the type set forth in clauses (a) or
(b) of Article VII (without giving effect to any grace period set
forth therein) has occurred and is continuing and the Agent, at the request of
the Required Lenders, so notifies the Borrower, then, so long as an Event of
Default is continuing (i) no outstanding Borrowing may be converted to or
continued as a LIBOR Rate Borrowing and (ii) unless repaid, each LIBOR
Rate Borrowing shall be converted to an ABR Borrowing at the end of the then
current Interest Period applicable thereto.

SECTION 2.06>    Termination
and Reduction of Commitments. (a)  The Term Loan Commitments shall
automatically terminate upon the making of the Term Loans on the Closing Date. The
Revolving Credit Commitments, the Swingline Commitment and the L/C Commitment
shall automatically terminate on the Revolving Credit Maturity Date.

(b)  Upon at least three Business Days’
prior irrevocable written or fax notice (or telephonic notice promptly
confirmed by written notice) to the Agent, the Borrower may at any time in
whole permanently terminate, or from time to time in part permanently reduce,
the Term Loan Commitments or the Revolving Credit Commitments; provided, however,
that (i) each partial reduction of the Term Loan Commitments or the
Revolving Credit Commitments shall be in an integral multiple of $1,000,000 and
in a minimum amount of $1,000,000 and (ii) the Total Revolving Credit
Commitment shall not be reduced to an amount that is less than the Aggregate
Revolving Credit Exposure at the time.

(c)  Each reduction in the Term Loan
Commitments or the Revolving Credit Commitments hereunder shall be made ratably
among the Lenders in accordance with their respective applicable Commitments. The
Borrower shall pay to the Agent for the account of the applicable Lenders,

 46
 

 

 

on the date of termination of the Commitments of any Class, all accrued
and unpaid Commitment Fees relating to such Class to but excluding the
date of such termination.

SECTION 2.07.      Repayment
of Loans; Evidence of Debt. (a)  The Borrower hereby unconditionally
promises to pay to each Lender, through the Agent, (i) the then unpaid
principal amount of each Term Loan of such Lender on the Term Loan Maturity
Date and (ii) the then unpaid principal amount of each Revolving Loan of
such Lender on the Revolving Credit Maturity Date. The Borrower hereby promises
to pay to the Swingline Lender the then unpaid principal amount of each
Swingline Loan on the Revolving Credit Maturity Date.

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

(c)  The Agent shall maintain accounts
in which it shall record (i) the amount of each Loan made hereunder, the
Type thereof and the Interest Period (if any) applicable thereto, (ii) the
amount of any principal or interest due and payable or to become due and payable
from the Borrower to each Lender hereunder and (iii) the amount of any sum
received by the Agent hereunder for the account of the Lenders and each Lender’s
share thereof.

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

(e)  Any Lender may request that Loans
made by it be evidenced by a promissory note. In such event, the Borrower shall
prepare, execute and deliver to such Lender a promissory note payable to such
Lender and its registered assigns and in substantially the form of Exhibit F
hereto. Thereafter, the Loans evidenced by such promissory note and interest
thereon shall at all times (including after assignment pursuant to Section 9.04)
be represented by one or more promissory notes in such form payable to the
payee named therein and its registered assigns.

(f)  The Borrower shall pay to the
Agent, for the account of the Lenders, on each Incremental Term Loan Repayment
Date, a principal amount of the Other Term Loans (as adjusted from time to time
pursuant to Sections 2.07(f), 2.08 and 2.09) equal to the amount set forth
for such date in the applicable Incremental Term Loan Assumption Agreement,
together in each case with accrued and unpaid interest on the principal amount
to be paid to but excluding the date of such payment. To the extent not
previously paid, all Incremental Term Loans shall be due and payable on the
applicable Incremental Term Loan Maturity Date and all Incremental Revolving
Loans shall be due and payable on the applicable Incremental Revolving Credit
Maturity Date, together in each case with accrued and unpaid interest on the
principal amount to be paid to but excluding the date of payment.

(g)  In the event and on each occasion
that any Term Loan Commitment (other than any Incremental Term Loan Commitment)
shall be reduced or shall expire or terminate other than as a result of the
making of a Term Loan, the principal amount payable on the Term Loan Maturity
Date shall be reduced pro rata by an aggregate amount equal to the amount of
such reduction, expiration or termination.

SECTION 2.08.      Optional
Prepayment of Loans. (a)  Upon prior
notice in accordance with paragraph (b) of this Section, the Borrower
shall have the right at any time and from time to time to prepay any Borrowing
in whole or in part without premium or penalty (but subject to Section 2.14);
provided that each partial prepayment

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shall be in an amount that is an integral multiple of
$100,000 and not less than $500,000 and provided, further, that
any optional prepayment of Term Loans pursuant to this paragraph (a) made
prior to the first anniversary of the Closing Date shall be accompanied by a
prepayment fee in an amount (expressed as a percentage of the principal amount
of Term Loans to be prepaid) equal to 1.00% of the principal amount of the Term
Loans to be prepaid.

(b) 
The Borrower shall notify the Agent by telephone (confirmed by
facsimile) of any prepayment hereunder (i) in the case of prepayment of a
LIBOR Rate Borrowing, not later than 11:00 a.m., New York City time, three
(3) Business Days before the date of prepayment or (ii) in the case
of prepayment of an ABR Borrowing, not later than 10:00 a.m., New York
City time, on the day of prepayment. Each such notice shall be irrevocable and
shall specify the prepayment date and the principal amount of each Borrowing or
portion thereof to be prepaid. Promptly following receipt of any such notice
relating to a Borrowing, the Agent shall advise the Lenders of the contents
thereof. Each partial prepayment of any Borrowing shall be in an amount that
would be permitted in the case of a Borrowing of the same Type as provided in Section 2.02.
Each prepayment of a Borrowing shall be applied ratably to the Loans included
in the prepaid Borrowing. Prepayments shall be accompanied by accrued interest
as required by Section 2.11; provided, however, that in the
case of a prepayment of an ABR Revolving Loan or a Swingline Loan that is not
made in connection with a termination of the Revolving Credit Commitments, the
accrued and unpaid interest on the principal amount prepaid shall be payable on
the next scheduled Interest Payment Date with respect to such ABR Revolving
Loan or Swingline Loan.

(c) 
Optional prepayments of Term Loans shall be allocated ratably between
the Term Loans and the Other Term Loans, if any, and shall be applied in
chronological order to the installments of principal in respect of the Term
Loans and Other Term Loans scheduled to be paid.

SECTION 2.09.      Mandatory
Prepayment of Loans. (a)  No later
than the earlier of (i) ninety (90) days after the end of each fiscal year
of the Borrower, commencing with the fiscal year ending on September 30,
2007, and (ii) the date on which the financial statements with respect to
such period are delivered pursuant to Section 5.01(a), the Borrower shall
prepay outstanding Term Loans in accordance with Section 2.09(d) in
an aggregate principal amount equal to 50% of Excess Cash Flow for the fiscal
year then ended; provided (x) that the amount of such prepayment
shall be reduced to 25% of such Excess Cash Flow if the Consolidated Leverage
Ratio at the end of such fiscal year shall be equal to or less than 5.00 to
1.00, but greater than 4.50 to 1.00, and (y) such prepayment shall not be
required if (A) the Consolidated Leverage Ratio at the end of such fiscal
year shall be equal to or less than 4.50 to 1.00 or (B) the credit
facility represented by the Term Loans is rated not lower than Ba3 by Moody’s
or not lower than BB- by S&P at the end of such fiscal year.

(b) 
The Borrower shall deliver to the Agent, at the time of each prepayment
required under this Section 2.09, (i) a certificate signed by a
Financial Officer of the Borrower setting forth in reasonable detail the
calculation of the amount of such prepayment and (ii) to the extent
practicable, at least three (3) days prior written notice of such
prepayment. Each notice of prepayment shall specify the prepayment date, the
Type of each Loan being prepaid and the principal amount of each Loan (or
portion thereof) to be prepaid. Each prepayment of a Borrowing shall be applied
ratably to the Loans included in the prepaid Borrowing. Prepayments shall be
accompanied by accrued interest as required by Section 2.11. All prepayments
of Borrowings under this Section 2.09 shall be subject to Section 2.14,
but shall otherwise be without premium or penalty.

(c)  In
the event of any termination of all the Revolving Credit Commitments, the
Borrower shall, on the date of such termination, repay or prepay all its
outstanding Revolving Credit Borrowings and all outstanding Swingline Loans and
replace all (or make other arrangements, including providing cash collateral or
a supporting letter of credit, acceptable to the Issuing Bank in its sole

 48
 

 

 

discretion, with respect thereto) outstanding Letters of Credit. If as
a result of any partial reduction of the Revolving Credit Commitments the
Aggregate Revolving Credit Exposure would exceed the Total Revolving Credit
Commitment after giving effect thereto, then the Borrower shall, on the date of
such reduction, repay or prepay Revolving Credit Borrowings or Swingline Loans
(or a combination thereof) and/or replace outstanding (or make such other
arrangement with respect to) Letters of Credit in an amount sufficient to
eliminate such excess.

(d) 
Mandatory prepayments of outstanding Term Loans under this Agreement
shall be allocated ratably between the Term Loans and the Other Term Loans, if
any, and shall be applied in chronological order to the remaining scheduled
installments of principal due in respect of the Term Loans and Other Term
Loans.

(e)  With respect to mandatory
prepayments of outstanding Term Loans under this Agreement made pursuant to Section 2.09(a),
each Term Loan Lender may elect, by written notice to the Agent at least one
Business Day prior to the prepayment date, to decline its pro rata share of
such Term Loan repayment, in which case the amount so declined shall be offered
ratably to each non-rejecting Term Loan Lender, who shall have the right to
reject such additional amount, and any amounts so rejected shall be retained by
the Borrower.

SECTION 2.10.      Fees.
(a)  The Borrower agrees to pay to each
Lender, through the Agent, on the last Business Day of March, June, September and
December in each year and on each date on which any Commitment of such
Lender shall expire or be terminated as provided herein, a commitment fee (a “Commitment
Fee”) equal to the Applicable Rate per annum in effect from time to time on
the daily unused amount of the Commitments of such Lender (other than the
Swingline Commitment) during the preceding quarter (or other period commencing
with the Closing Date or ending with the Revolving Credit Maturity Date or the
date on which the Commitments of such Lender shall expire or be terminated). All
Commitment Fees shall be computed on the basis of the actual number of days
elapsed in a year of 360 days. The Commitment Fee due to each Lender shall
commence to accrue on the Closing Date and shall cease to accrue on the date on
which the Commitment of such Lender shall expire or be terminated as provided
herein. For purposes of calculating Commitment Fees only, no portion of the
Revolving Credit Commitments shall be deemed utilized as a result of
outstanding Swingline Loans

(b) 
The Borrower agrees to pay to the Agent, for its own account, the agency
fees set forth in the Fee Letter, as amended, restated, supplemented or
otherwise modified from time to time, or such agency fees as may otherwise be
separately agreed upon by the Borrower and the Agent payable in the amounts and
at the times specified therein or as so otherwise agreed upon (the “Agent
Fees”).

(c) 
The Borrower agrees to pay (i) to each Revolving Credit Lender,
through the Agent, on the last Business Day of March, June, September and December of
each year and on the date on which the Revolving Credit Commitment of such
Lender shall be terminated as provided herein, a fee (an “L/C Participation
Fee”) calculated on such Lender’s Pro Rata Percentage of the daily
aggregate L/C Exposure (excluding the portion thereof attributable to
unreimbursed L/C Disbursements) during the preceding quarter (or shorter period
commencing with the Closing Date or ending with the Revolving Credit Maturity
Date or the date on which all Letters of Credit have been canceled or have
expired and the Revolving Credit Commitments of all Lenders shall have been
terminated) at a rate per annum equal to the Applicable Rate from time to time
used to determine the interest rate on Revolving Credit Borrowings comprised of
LIBOR Rate Loans pursuant to Section 2.11, and (ii) to the Issuing
Bank with respect to each Letter of Credit the standard fronting (equal to
0.125% per annum on the aggregate outstanding face amount of such Letter of
Credit), issuance and drawing fees specified from time to time by the Issuing
Bank (the “Issuing Bank Fees”). All L/C Participation Fees and Issuing
Bank Fees shall be computed on the basis of the actual number of days elapsed
in a year of 360 days.

 49
 

 

 

(d) 
All Fees shall be paid on the dates due, in immediately available funds,
to the Agent for distribution, if and as appropriate, among the Lenders, except
that the Issuing Bank Fees shall be paid directly to the Issuing Bank. Once
paid, none of the Fees shall be refundable under any circumstances.

SECTION 2.11.      Interest.
(a)  The Loans comprising each
ABR Borrowing, including each Swingline Loan, shall bear interest at the
Alternate Base Rate plus the Applicable Rate.

(b) 
The Loans comprising each LIBOR Rate Borrowing shall bear interest at
the Adjusted LIBOR Rate for the Interest Period in effect for such Borrowing
plus the Applicable Rate.

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

(d) 
Accrued interest on each Loan shall be payable to the applicable
Lenders, through the Agent, in arrears on each Interest Payment Date for such
Loan; provided that (i) interest accrued pursuant to paragraph (c) of
this Section shall be payable on demand, (ii) in the event of any
repayment or prepayment of any Loan, accrued interest on the principal amount
repaid or prepaid shall be payable on the date of such repayment or prepayment
and (iii) in the event of any conversion of any LIBOR Rate Loan prior to
the end of the current Interest Period therefor, accrued interest on such Loan
shall be payable on the effective date of such conversion.

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

SECTION 2.12.      Alternate
Rate of Interest. If prior to the commencement of any Interest Period for a
LIBOR Rate Borrowing:

(a) the
Agent determines (which determination shall be conclusive absent manifest
error) that dollar deposits in the principal amount of the Loans comprising
such Borrowing are not generally available in the London interbank market;

(b) the
Agent determines (which determination shall be conclusive absent manifest
error) that adequate and reasonable means do not exist for ascertaining the
Adjusted LIBOR Rate or the LIBOR Rate, as applicable, for such Interest Period;
or

(c) the
Agent is advised by the Required Lenders that the Adjusted LIBOR Rate or the
LIBOR Rate, as applicable, for such Interest Period will not adequately and
fairly reflect the cost to such Lenders of making or maintaining their Loans
included in such Borrowing for such Interest Period;

then the Agent shall promptly give notice thereof to
the Borrower and the Lenders by telephone or facsimile as promptly as
practicable thereafter and, until the Agent notifies the Borrower and the
Lenders that the circumstances giving rise to such notice no longer exist, any
request by the Borrower for a

 

 50

 

 

LIBOR Rate Borrowing pursuant
to Section 2.03 or 2.05 shall be deemed to be a request for an ABR
Borrowing.

Section 2.13.          Increased Costs.  (a)  If
any Change in Law shall:

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

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

and the result of any of the
foregoing shall be to increase the cost to such Lender or the Issuing Bank of
making or maintaining any LIBOR Rate Loan or increase the cost to any Lender of
issuing or maintaining any Letter of Credit or purchasing or maintaining a
participation therein or to reduce the amount of any sum received or receivable
by such Lender or the Issuing Bank hereunder (whether of principal, interest or
otherwise), then, following delivery of the certificate contemplated by
paragraph (c) of this Section, the Borrower will pay to such Lender or the
Issuing Bank, as the case may be, such additional amount or amounts as will
compensate such Lender or the Issuing Bank for such additional costs incurred
or reduction suffered (except for any Taxes, which shall be dealt with
exclusively pursuant to Section 2.15).

(b)  If any Lender or the Issuing Bank determines
that any Change in Law regarding capital requirements has or would have the
effect of reducing the rate of return on such Lender’s or the Issuing Bank’s
capital or on the capital of such Lender’s or the Issuing Bank’s holding
company, if any, as a consequence of this Agreement or the Loans made or
participations in Letters of Credit purchased by such Lender pursuant hereto or
the Letters of Credit issued by the Issuing Bank pursuant hereto to a level
below that which such Lender or the Issuing Bank or such Lender’s or the
Issuing Bank’s holding company could have achieved but for such Change in
Law  other than due to Taxes, which shall
be dealt with exclusively pursuant to Section 2.15 (taking into
consideration such Lender’s or the Issuing Bank’s policies and the policies of
such Lender’s or the Issuing Bank’s holding company with respect to capital
adequacy), then from time to time following delivery of the certificate
contemplated by paragraph (c) of this Section the Borrower will
pay to such Lender or the Issuing Bank, as the case may be, such additional
amount or amounts as will compensate such Lender or the Issuing Bank or such
Lender’s or the Issuing Bank’s holding company for any such reduction suffered.

(c)  A certificate of a Lender or the Issuing Bank
setting forth the amount or amounts necessary to compensate such Lender or the
Issuing Bank or its holding company as specified in paragraph (a) or (b) of
this Section and setting forth in reasonable detail the manner in which
such amount or amounts was determined shall be delivered to the Borrower and
shall be conclusive absent manifest error. The Borrower shall pay such Lender
or the Issuing Bank, as the case may be, the amount shown as due on any such
certificate within ten (10) days after receipt thereof.

(d)  Failure or delay on the part of any Lender or
the Issuing Bank to demand compensation pursuant to this Section shall not
constitute a waiver of such Lender’s or the Issuing Bank’s right to demand such
compensation; provided that the Borrower shall not be required to
compensate a Lender or the Issuing Bank pursuant to this Section for any
increased costs or reductions incurred more than 180 days prior to the date
that such Lender or the Issuing Bank notifies the Borrower of the Change in Law
giving rise to such increased costs or reductions and of such Lender’s or the
Issuing Bank’s intention to claim compensation therefor; provided  further
that, if the Change in Law giving rise to such

 51
 

 

 

 increased costs or reductions is retroactive,
then the 180-day period referred to above shall be extended to include
the period of retroactive effect thereof.

Section 2.14.          Break Funding Payments.  In the event of (a) the payment of any
principal of any LIBOR Rate Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default), (b) the
conversion of any LIBOR Rate Loan or the conversion of the Interest Period with
respect to any LIBOR Rate Loan other than on the last day of the Interest
Period applicable thereto, (c) the failure to borrow, convert, continue or
prepay any LIBOR Rate Loan on the date specified in any notice delivered
pursuant hereto, or (d) the assignment of any LIBOR Rate Loan other than
on the last day of the Interest Period applicable thereto as a result of a
request by the Borrower pursuant to Section 2.17, then, in any such event,
the Borrower shall compensate each Lender for the loss, cost and expense
attributable to such event. In the case of a LIBOR Rate Loan, such loss, cost or
expense to any Lender shall not include loss of profit or margin and shall be
deemed to be the amount determined by such Lender to be the excess, if any, of (i) the
amount of interest which would have accrued on the principal amount of such
Loan had such event not occurred, at the Adjusted LIBOR Rate that would have
been applicable to such Loan, for the period from the date of such event to the
last day of the then current Interest Period therefor (or, in the case of a
failure to borrow, convert or continue, for the period that would have been the
Interest Period for such Loan), over (ii) the amount of interest which
would accrue on such principal amount for such period at the interest rate
which such Lender would bid were it to bid, at the commencement of such period,
for dollar deposits of a comparable amount and period from other banks in the
eurodollar market. A certificate of any Lender setting forth any amount or
amounts that such Lender is entitled to receive pursuant to this Section and
the basis therefor and setting forth in reasonable detail the manner in which
such amount or amounts was determined shall be delivered to the Borrower and
shall be conclusive absent manifest error. The Borrower shall pay such Lender
the amount shown as due on any such certificate within ten (10) days after
receipt thereof.

Section 2.15.          Taxes.  (a) 
Any and all payments by or on account of any obligation of any Loan
Party hereunder or under any other Loan Document shall be made free and clear
of and without deduction for any Indemnified Taxes or Other Taxes; provided
that if a Loan Party shall be required to deduct any Indemnified Taxes or Other
Taxes from such payments, then (i) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section) the Agent or Lender
(as applicable) receives an amount equal to the sum it would have received had
no such deductions been made, (ii) such Loan Party shall make such
deductions and (iii) such Loan Party shall timely pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable
law. If at any time a Loan Party is required by applicable law to make any
deduction or withholding from any sum payable hereunder, such Loan Party shall
promptly notify the relevant Lender or Agent upon becoming aware of the same.
In addition, each Lender or Agent shall promptly notify a Loan Party upon
becoming aware of any circumstances as a result of which a Loan Party is or
would be required to make any deduction or withholding from any sum payable
hereunder.

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

(c)  Each Loan Party shall indemnify the Agent and
each Lender, within ten (10) days after written demand therefor, for the
full amount of any Indemnified Taxes or Other Taxes paid by the Agent or such
Lender, as applicable, on or with respect to any payment by or on account of any
obligation of such Loan Party hereunder or under any other Loan Document
(including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any penalties, interest
and reasonable expenses arising therefrom or with respect thereto, whether or
not such Indemnified Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant 

 52
 

 

 

Governmental Authority. A certificate as to
the amount of such payment or liability delivered to the Borrower by a Lender,
or by the Agent on its own behalf or on behalf of a Lender, shall be conclusive
absent manifest error.

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

(e)  Any Foreign Lender that is entitled to an
exemption from or reduction of withholding tax under the law of the
jurisdiction in which the Borrower is located, or any treaty to which such
jurisdiction is a party, with respect to payments under this Agreement shall
deliver to the Borrower (with a copy to the Agent), at the time or times
prescribed by applicable law, such properly completed and executed
documentation prescribed by applicable law or reasonably requested by the
Borrower as will permit such payments to be made without withholding or at a
reduced rate. In particular, on or prior to the date which is ten (10) Business
Days after the Closing Date, each Foreign Lender shall deliver to the Borrower
(with a copy to the Agent) two duly signed, properly completed copies of either
IRS Form W- 8BEN or any successor thereto (relating to such Foreign
Lender and entitling it to an exemption from, or reduction of, United States
withholding tax on all payments to be made to such Foreign Lender by the Borrower
or any other Loan Party pursuant to this Agreement or any other Loan Document)
or IRS Form W-8ECI or any successor thereto (relating to all
payments to be made to such Foreign Lender by the Borrower or any other Loan
Party pursuant to this Agreement or any other Loan Document) or such other
evidence reasonably satisfactory to the Borrower and the Agent that such
Foreign Lender is entitled to an exemption from, or reduction of, United States
withholding tax, including any exemption pursuant to Section 871(h) or
881(c) of the Code, and in the case of a Foreign Lender claiming such an
exemption under Section 881(c) of the Code, a certificate that
establishes in writing to the Borrower and the Agent that such Foreign Lender
is not (i) a “bank” as defined in Section 881(c)(3)(A) of the
Code, (ii) a 10-percent stockholder within the meaning of Section 871(h)(3)(B) of
the Code, or (iii) a controlled foreign corporation related to the
Borrower with the meaning of Section 864(d) of the Code. Thereafter
and from time to time, each such Foreign Lender shall (A) promptly submit
to the Borrower (with a copy to the Agent) such additional duly completed and
signed copies of one or more of such forms or certificates (or such successor
forms or certificates as shall be adopted from time to time by the relevant
United States taxing authorities) as may then be available under then current
United States Laws and regulations to avoid, or such evidence as is reasonably
satisfactory to the Borrower and the Agent of any available exemption from, or
reduction of, United States withholding taxes in respect of all payments to be
made to such Foreign Lender by the Borrower or other Loan Party pursuant to
this Agreement, or any other Loan Document, in each case, (1) on or before
the date that any such form, certificate or other evidence expires or becomes
obsolete, (2) after the occurrence of any event requiring a change in the
most recent form, certificate or evidence previously delivered by it to the
Borrower and (3) from time to time thereafter if reasonably requested by
the Borrower or the Agent, and (B) promptly notify the Borrower and the
Administrative Agent of any change in circumstances which would modify or
render invalid any claimed exemption or reduction.

(f)  Each Lender or Agent that is a United States
person, agrees to complete and deliver to the Borrower a statement signed by an
authorized signatory of the Lender to the effect that it is a United States
person together with a duly completed and executed copy of Internal Revenue
Service Form W-9 or successor form.

(g)  If the Agent or a Lender determines, in good
faith in its sole discretion, that it has received a refund of any Indemnified Taxes or Other Taxes as to which
it has been indemnified by a Loan Party or with respect to which such Loan
Party has paid additional amounts pursuant to this Section 2.15,

 53
 

 

 

it shall pay
over such refund to such Loan Party (but only to the extent of indemnity
payments made, or additional amounts paid, by such Loan Party under this Section 2.15
with respect to the Taxes or Other Taxes giving rise to such refund), net of
all out-of-pocket expenses of the Agent or such Lender (including any Taxes imposed with respect to
such refund) as is determined by the Agent or such Lender in good faith in its
sole discretion, and without interest
(other than any interest paid by the relevant Governmental Authority with
respect to such refund); provided, that such Loan Party, upon the
request of the Agent or such Lender, agrees to repay as soon as reasonably
practicable the amount paid over to such Loan Party (plus any penalties,
interest or other charges imposed by the relevant Governmental Authority) to
the Agent or such Lender in the event the Agent or such Lender is required to
repay such refund to such Governmental Authority. This Section shall not
be construed to require the Agent or any Lender to make available its tax
returns (or any other information relating to its taxes which it deems
confidential) to such Loan Party or any other Person.

(h)  If the Borrower determines in good faith that
a reasonable basis exists for contesting any Indemnified Taxes or Other Taxes
for which additional amounts have been paid under this Section 2.15, the
relevant Lender or Agent shall cooperate with the Borrower in challenging such
Indemnified Taxes or Other Taxes, at the Borrower’s expense, if so requested by
the Borrower in writing.

Section 2.16.          Payments Generally; Allocation of
Proceeds; Sharing of Set-offs.  (a)  Unless otherwise specified, the Borrower
shall make each payment required to be made by it hereunder and under any other
Loan Document (whether of principal, interest or fees, or of amounts payable
under Section 2.13, 2.14 or 2.15, or otherwise) prior to 12:00 (noon), New
York City time, on the date when due, in immediately available funds, without
set-off or counterclaim. Any amounts received after such time on any date
may, in the discretion of the Agent, be deemed to have been received on the
next succeeding Business Day for purposes of calculating interest thereon. All
such payments (other than (i) Issuing Bank Fees, which shall be paid
directly to the Issuing Bank, and (ii) principal of and interest on
Swingline Loans, which shall be paid directly to the Swingline Lender except as
otherwise provided in Section 2.22(e)) shall be made to the Agent to the
applicable account designated to the Borrower by the Agent, except that
payments pursuant to Sections 2.13, 2.14, 2.15 and 9.03 shall be made directly
to the Persons entitled thereto. The Agent shall distribute any such payments
received by it, except as otherwise provided, for the account of any other
Person to the appropriate recipient promptly following receipt thereof. If any
payment hereunder shall be due on a day that is not a Business Day, the date
for payment shall be extended to the next succeeding Business Day, and, in the
case of any payment accruing interest, interest thereon shall be payable for
the period of such extension. All payments hereunder shall be made in Dollars. Any
payment required to be made by the Agent hereunder shall be deemed to have been
made by the time required if the Agent shall, at or before such time, have
taken the necessary steps to make such payment in accordance with the
regulations or operating procedures of the clearing or settlement system used
by the Agent to make such payment.

(b)  [Intentionally Omitted.]

(c)  If any Lender shall, by exercising any right
of set-off or counterclaim or otherwise, obtain payment in respect of any
principal of or interest on any of its Loans or any of its L/C Disbursements
resulting in such Lender receiving payment of a greater proportion of the
aggregate amount of its Loans and accrued interest thereon and L/C
Disbursements than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value)
participations in the Loans and L/C Disbursements of other Lenders at such time
outstanding to the extent necessary so that the benefit of all such payments
shall be shared by the Lenders ratably in accordance with the aggregate amount
of principal of and accrued interest on their respective Loans and L/C
Disbursements; provided that (i) if any such participations are purchased
and all or any portion of the payment giving rise thereto is recovered,  such participations shall be rescinded and
the purchase price

 54
 

 

 

restored to the extent of such recovery,
without interest, and (ii) the provisions of this paragraph shall not be
construed to apply to any payment made by the Borrower pursuant to and in
accordance with the express terms of this Agreement or any payment obtained by
a Lender as consideration for the assignment of or sale of a participation in
any of its Loans or L/C Disbursements to any assignee or participant, other than
to the Borrower or any subsidiary thereof (as to which the provisions of this
paragraph shall apply). The Borrower consents to the foregoing and agrees, to
the extent it may effectively do so under applicable law, that any Lender
acquiring a participation pursuant to the foregoing arrangements may exercise
against the Borrower rights of set-off and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of the Borrower
in the amount of such participation.

(d)  Unless the Agent shall have received notice
from the Borrower prior to the date on which any payment is due to the Agent
for the account of the Lenders that the Borrower will not make such payment,
the Agent may assume that the Borrower has made such payment on such date in
accordance herewith and may, in reliance upon such assumption, distribute to
the Lenders the amount due. In such event, if the Borrower has not in fact made
such payment, then each of the Lenders severally agrees to repay to the Agent
forthwith on demand the amount so distributed to such Lender with interest
thereon, for each day from and including the date such amount is distributed to
it to but excluding the date of payment to the Agent, at the greater of the
Federal Funds Effective Rate and a rate determined by the Agent in accordance
with banking industry rules on interbank compensation.

(e)  If any Lender shall
fail to make any payment required to be made by it pursuant to Sections
2.04(a), 2.16(c) or 9.03(c), then the Agent may, in its discretion
(notwithstanding any contrary provision hereof), apply any amounts thereafter
received by the Agent for the account of such Lender to satisfy such Lender’s
obligations under such Sections until all such unsatisfied obligations are
fully paid.

(f)  Except as otherwise provided herein, each
Borrowing, each payment or prepayment of principal of any Borrowing, each
payment of interest on the Loans, each payment of the Commitment Fees or the
L/C Participation Fees, each reduction of the Term Loan Commitments or the
Revolving Credit Commitments and each conversion of any Borrowing to or
continuation of any Borrowing as a Borrowing of any Type shall be allocated pro
rata among the Lenders in accordance with their respective applicable
Commitments (or, if such Commitments shall have expired or been terminated, in
accordance with the respective principal amounts of their outstanding Loans or
participations in L/C Disbursements, as applicable). Each Lender agrees that in
computing such Lender’s portion of any Borrowing to be made hereunder, the
Agent may, in its discretion, round each Lender’s percentage of such Borrowing
to the next higher or lower whole dollar amount

Section 2.17.          Mitigation Obligations; Replacement
of Lenders.  (a)  If any Lender or the Issuing Bank requests
compensation under Section 2.13, or if the Borrower is required to
pay any additional amount to any Lender or the Issuing Bank or any Governmental
Authority for the account of any Lender or the Issuing Bank pursuant to Section 2.15,
then such Lender or the Issuing Bank shall use reasonable efforts to designate
a different lending office for funding or booking its Loans or issuing Letters
of Credit hereunder or to assign its rights and obligations hereunder to
another of its offices, branches or affiliates, if, in the reasonable judgment
of such Lender or the Issuing Bank, such designation or assignment (i) would
eliminate or reduce amounts payable pursuant to Section 2.13 or 2.15, as
applicable, in the future and (ii) would not subject such Lender or the
Issuing Bank to any material unreimbursed cost or expense and would not
otherwise be disadvantageous to such Lender or the Issuing Bank in any material
respect. The Borrower hereby agrees to pay all reasonable costs and expenses
incurred by any Lender or the Issuing Bank in connection with any such
designation or assignment.

(b)  If any Lender or the Issuing Bank requests
compensation under Section 2.13, or if the Borrower is required to pay any
additional amount to any Lender or the Issuing Bank or any

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Governmental Authority for the account of any
Lender or the Issuing Bank pursuant to Section 2.15, then the Borrower
may, at its sole expense and effort, upon notice to such Lender or the Issuing
Bank and the Agent, replace such Lender or the Issuing Bank by requiring such
Lender or the Issuing Bank to assign and delegate (and such Lender or the
Issuing Bnak shall be obligated to assign and delegate), without recourse (in
accordance with and subject to the restrictions contained in Section 9.04),
all its interests, rights and obligations under this Agreement to an assignee
that shall assume such obligations (which assignee may be another Lender, if a
Lender accepts such assignment); provided that (i) the Borrower shall have
received the prior written consent of the Agent (and, if a Revolving Credit
Commitment is being assigned, of the Issuing Bank and the Swingline Lender),
which consent shall not unreasonably be withheld, (ii) such Lender or the
Issuing Bank shall have received payment of an amount equal to the outstanding
principal of its Loans and L/C Disbursements, accrued interest thereon, accrued
fees and all other amounts payable to it hereunder, from the assignee (to the
extent of such outstanding principal and accrued interest and fees) or the
Borrower (in the case of all other amounts) and (iii) in the case of any
such assignment resulting from a claim for compensation under Section 2.13
or payments required to be made pursuant to Section 2.15, such assignment
will result in a reduction in such compensation or payments. A Lender or the
Issuing Bank shall not be required to make any such assignment and delegation
if, prior thereto, as a result of a waiver by such Lender or the Issuing Bank
or otherwise, the circumstances entitling the Borrower to require such
assignment and delegation cease to apply.

Section 2.18.          Illegality.  If any Lender reasonably determines that any
Change in Law has made it unlawful, or that any Governmental Authority has
asserted after the Closing Date that it is unlawful, for such Lender or its
applicable lending office to make or maintain any LIBOR Rate Loans, then, on
notice thereof by such Lender to the Borrower through the Agent, any
obligations of such Lender to make or continue LIBOR Rate Loans or to convert ABR
Borrowings to LIBOR Rate Borrowings shall be suspended until such Lender
notifies the Agent and the Borrower that the circumstances giving rise to such
determination no longer exist. Upon receipt of such notice, the Borrower shall
upon demand from such Lender (with a copy to the Agent), either convert all
LIBOR Rate Borrowings of such Lender to ABR Borrowings, either on the last day
of the Interest Period therefor, if such Lender may lawfully continue to
maintain such LIBOR Rate Borrowings to such day, or immediately, if such Lender
may not lawfully continue to maintain such Loans. Upon any such prepayment or
conversion, the Borrower shall also pay accrued interest on the amount so
prepaid or converted. Each Lender agrees to designate a different lending
office if such designation will avoid the need for such notice and will not, in
the determination of such Lender, otherwise be disadvantageous to it.

Section 2.19.          Change of Control.  (a) 
The Borrower shall (i) within thirty (30) days following the occurrence
of a Change of Control, make an offer to all Term Lenders to prepay all Term
Loans pursuant to a Change in Control Offer (as defined in paragraph (b) of
this Section 2.19) at a purchase price in cash equal to 101% of the
principal amount thereof, plus accrued and unpaid interest to the date of
prepayment, in accordance with the terms contemplated in this Section 2.19;
and (ii) prepay all the Term Loans of all Term Lenders properly accepting
such offer of prepayment in accordance with such Change of Control Offer.

(b)  A “Change of Control Offer” means a
notice delivered to the Agent (which will promptly furnish such notice to the
Term Lenders) stating:

(i) that a Change of Control has
occurred and that such Term Lender has the right to require the Borrower to
prepay all or a portion of such Term Lender’s Term Loans at a purchase price in
cash equal to 101% of the principal amount thereof, plus accrued and unpaid
interest to the date of prepayment;

(ii) the Change of Control prepayment
date (which shall be no earlier than thirty (30) days nor later than sixty (60)
days from the date such notice is delivered);

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(iii) that any Term Loans as to which
such offer is not properly accepted will remain outstanding and continue to
accrue interest;

(iv) unless the Borrower defaults in the
payment of the purchase price of any Term Loans as to which the Change of
Control Offer shall have been accepted, all Term Loans accepted for payment
pursuant to the Change of Control Offer will cease to accrue interest on the Change
of Control prepayment date;

(v) Term Lenders electing to have any
Term Loans purchased pursuant to a Change of Control Offer will be required to
notify the Agent prior to the close of business on the third Business Day
preceding the Change of Control prepayment date; and

(vi) that Term Lenders will be entitled
to withdraw their election to require the Borrower to prepay their Term Loans; provided that the Agent receives, not later than
the close of business on the last day of the offer period, a notice setting
forth the name of the Term Lender, the principal amount of Term Loans tendered
for prepayment, and a statement that such Term Lender is withdrawing its
election to have such Term Loans prepaid.

(c)  On the prepayment date, the Borrower shall
prepay the Term Loans of all Term Lenders who accept the Change of Control
Offer at a purchase price in cash equal to 101% of the principal amount
thereof, plus accrued and unpaid interest, if any, to the date of prepayment. If
at the time of any prepayment pursuant to this Section 2.19 there shall be
outstanding Term Borrowings of different Types or LIBOR Rate Borrowings with
different Interest Periods, and if some but not all Term Lenders shall have
accepted such Change of Control Offer, then the aggregate amount of such
prepayment shall be allocated ratably to each outstanding Term Borrowing that
comprises the Term Loans of the accepting Term Lenders. All prepayments of Term
Loans under this Section 2.19 shall be subject to Section 2.14.

(d)  Notwithstanding the foregoing provisions of
this Section, the Borrower shall be deemed to have made a Change of Control
Offer upon a Change of Control if a third party makes the Change of Control
Offer in the manner, at the times and otherwise in compliance with the requirements
set forth in Section 2.19(b) applicable to a Change of Control Offer
made by the Borrower and prepays all Term Loans as to which offers for
prepayment have been validly accepted and not withdrawn pursuant to the terms
of such Change of Control Offer.

(e)  A Change of Control Offer may be made in
advance of a Change of Control, conditional upon such Change of Control, if a
definitive agreement is in place for such Change of Control at the time of
making of the Change of Control Offer.

Section 2.20.          Asset Sale Offer.   (a) 
Upon the consummation of an Asset Sale of Collateral, the Borrower shall
apply, or cause such Restricted Subsidiary to apply, the Net Cash Proceeds
relating to such Asset Sale within 365 days of receipt thereof either (i)(A) to
make an offer to the Term Lenders to prepay Term Loans or (B) to make an
offer to purchase, prepay or permanently reduce Other Pari Passu Lien
Obligations secured by a Permitted Lien; provided, however, that
in connection with any prepayment, repayment or purchase of Indebtedness
pursuant to this clause (i), the Borrower or such Restricted Subsidiary shall
permanently retire such Indebtedness and, in the case of obligations under
revolving credit facilities or other similar Indebtedness, shall
correspondingly permanently reduce commitments with respect thereto (other than
obligations owed to the Borrower or a Restricted Subsidiary); provided, further,
however, that if the Borrower or such Restricted Subsidiary shall so
reduce obligations under any such Other Pari Passu Lien Obligations, the
Borrower or such Restricted Subsidiary will, equally and ratably, reduce the
amount of Indebtedness outstanding under this Agreement by, at its option, (I) prepaying
Term Loans in

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accordance with Section 2.08
or (II) making an offer (in accordance with the procedures set forth below
for an Asset Sale Offer) to all Term Lenders to prepay their Term Loans at 100%
of the principal amount thereof, plus
the amount of accrued and unpaid interest on the principal amount of Term Loans
to be prepaid; or (ii) to reinvest in Productive Assets (provided that
this requirement shall be deemed satisfied if the Borrower or such Restricted
Subsidiary by the end of such 365-day period has entered into a binding
agreement under which it is contractually committed to reinvest in Productive
Assets and such investment is consummated within 120 days from the date on
which such binding agreement is entered into and, with respect to the amount of
such investment, the reference to the 366th day after an Asset Sale in the
second sentence of Section 2.20(c) shall be deemed to be a reference
to the 121st day after the date on which such binding agreement is entered
into (but only if such 121st day occurs later than such 366th day)), or (iii) a
combination of prepayment and investment permitted by the foregoing clauses (i) and
(ii).

(b)  Upon the consummation of an Asset Sale (other
than an Asset Sale of Collateral), the Borrower shall apply, or cause such
Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset
Sale within 365 days of receipt thereof either (i) to permanently
reduce (A) obligations under any Senior Debt of the Borrower or any
Subsidiary Guarantor and, in the case of obligations under revolving credit
facilities or other similar Indebtedness, to correspondingly permanently reduce
commitments with respect thereto (other than obligations owed to the Borrower
or a Restricted Subsidiary); provided that if the Borrower or such
Restricted Subsidiary shall so reduce obligations under any Senior Debt, the
Borrower or such Restricted Subsidiary will, equally and ratably, reduce the
amount of Indebtedness outstanding under this Agreement by, at its option, (I) prepaying
Term Loans in accordance with Section 2.08 or (II) making an offer (in
accordance with the procedures set forth below for an Asset Sale Offer) to all
Term Lenders to prepay their Term Loans at 100% of the principal amount
thereof, plus the amount of
accrued and unpaid interest on the principal amount of Term Loans to be prepaid,
or (B) Indebtedness of a Restricted Subsidiary that is not a Subsidiary
Guarantor, other than Indebtedness owed to the Borrower or another Restricted
Subsidiary; or (ii) to reinvest in Productive Assets (provided that this
requirement shall be deemed satisfied if the Borrower or such Restricted
Subsidiary by the end of such 365-day period has entered into a binding
agreement under which it is contractually committed to reinvest in Productive
Assets and such investment is consummated within 120 days from the date on
which such binding agreement is entered into and, with respect to the amount of
such investment, the reference to the 366th day after an Asset Sale in the
second sentence of Section 2.20(c) shall be deemed to be a reference
to the 121st day after the date on which such binding agreement is entered
into (but only if such 121st day occurs later than such 366th day)), or (iii) a
combination of prepayment and investment permitted by the foregoing clauses (i) and
(ii).

(c)  Any Net Cash Proceeds from an Asset Sale that
are not invested or applied in accordance with paragraph (a) or (b) of
this Section 2.20 within 365 days from the date of the receipt of
such Net Cash Proceeds will be deemed to constitute “Excess Proceeds”. On
the 366th day after receipt of the Net Cash Proceeds of an Asset Sale (provided
the aggregate amount of Excess Proceeds exceeds $20,000,000), the Borrower
shall (i) make an offer within ten (10) Business Days after the date
that Excess Proceeds exceed $20,000,000 to all Term Lenders and, if required by
the terms of any other Senior Debt, to the holders of such Senior Debt (other
than with respect to Hedging Obligations) in accordance with the procedures set
forth below for prepayment or an Asset Sale Offer, to prepay the maximum
aggregate principal amount of Term Loans and prepay or purchase the maximum
principal amount of such Senior Debt that is an integral multiple of $1,000
that may be purchased out of the Excess Proceeds at a prepayment or purchase
price in cash equal to 100% of the principal amount thereof, plus accrued and
unpaid interest to the date of prepayment or repurchase, in accordance with the
terms contemplated in this Section 2.20; and (ii) prepay all the Term
Loans of Term Lenders properly accepting such offer of prepayment in accordance
with such Asset Sale Offer (subject to the proration provisions set forth in
paragraph (f) of this Section 2.20). The Borrower may satisfy
the foregoing obligations with respect to any

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Net Cash Proceeds from an Asset Sale by making
an Asset Sale Offer with respect to such Net Cash Proceeds prior to the
expiration of the relevant 365 day period or with respect to Excess Proceeds of
$20,000,000 or less.

(d)  An “Asset Sale Offer” means a notice
delivered to the Agent (which will promptly furnish such notice to the Term
Lenders) stating:

(i) that an Asset Sale Offer is being made pursuant to this Section 2.20
and that such Term Lender has the right to require the Borrower to prepay all
or a portion of such Term Lender’s Term Loans (subject to the proration
provisions set forth in paragraph (f) of this Section 2.20) at a
purchase price in cash equal to 100% of the principal amount thereof, plus
accrued and unpaid interest to the date of prepayment; and

(ii) the prepayment date (which shall be no earlier than thirty
(30) days nor later than sixty (60) days from the date such notice is mailed).

(e)  On the prepayment date, the Borrower (subject
to the proration provisions set forth in paragraph (f) of this Section 2.20)
shall prepay the Term Loans of all Term Lenders who accept the Asset Sale Offer
at a purchase price in cash equal to 100% of the principal amount thereof, plus
accrued and unpaid interest to the date of prepayment. If at the time of any
prepayment pursuant to this Section 2.20 there shall be outstanding Term
Borrowings of different Types or LIBOR Rate Borrowings with different Interest
Periods, and if some but not all Term Lenders shall have accepted such Asset
Sale Offer, then the aggregate amount of such prepayment shall be allocated
ratably to each outstanding Term Borrowing that comprises the Term Loans of the
accepting Term Lenders. All prepayments of Term Loans under this Section 2.20
shall be subject to Section 2.14.

(f)  To the extent that the aggregate amount of
Term Loans and other Senior Debt tendered pursuant to an Asset Sale Offer is
less than the Excess Proceeds, the Borrower may use any remaining Excess
Proceeds for general corporate purposes, subject to the terms of this Agreement.
If the aggregate principal amount of Term Loans and other Senior Debt tendered
pursuant to an Asset Sale Offer exceeds the amount of Excess Proceeds, the
Borrower shall select or cause to be selected the Term Loans and such other
Senior Debt to be prepaid or purchased on a pro rata basis based on the
principal amount (or accreted value) of the Term Loans and other Senior Debt
tendered. Upon completion of any such Asset Sale Offer, the amount of Excess
Proceeds related to such Asset Sale Offer shall be reset at zero.

(g)  Pending the final application of any Net Cash
Proceeds pursuant to this Section 2.20, the Borrower or such Restricted
Subsidiary may temporarily reduce Indebtedness under a revolving credit
facility, if any, or otherwise invest such Net Cash Proceeds in any manner not
prohibited hereunder.

Section 2.21.          Intentionally Omitted.

Section 2.22.          Swingline Loans.  (a) 
Subject to the terms and conditions and relying upon the representations
and warranties herein set forth, the Swingline Lender agrees to make loans to
the Borrower at any time and from time to time on and after the Closing Date
and until the earlier of the Revolving Credit Maturity Date and the termination
of the Revolving Credit Commitments in accordance with the terms hereof, in an
aggregate principal amount at any time outstanding that will not result in (i) the
aggregate principal amount of all Swingline Loans exceeding $5,000,000 in the
aggregate or (ii) the Aggregate Revolving Credit Exposure, after giving
effect to any Swingline Loan, exceeding the Total Revolving Credit Commitment. Each
Swingline Loan shall be in a principal amount that is an integral multiple of
$100,000 and not less than $100,000. The Swingline Commitment may be terminated
or reduced from time to time as provided herein. Within the foregoing limits,
the Borrower may borrow, pay or prepay and reborrow Swingline Loans hereunder,
subject to the terms, conditions and limitations set forth herein.

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(b)  The Borrower shall notify the Swingline
Lender by fax, or by telephone (confirmed by fax), not later than 12:00 (noon),
New York City time, on the day of a proposed Swingline Loan. Such notice shall
be delivered on a Business Day, shall be irrevocable and shall refer to this
Agreement and shall specify the requested date (which shall be a Business Day)
and amount of such Swingline Loan and the wire transfer instructions for the
account of the Borrower to which the proceeds of such Swingline Loan should be
transferred. The Swingline Lender shall promptly make each Swingline Loan by
wire transfer to the account specified by the Borrower in such request.

(c)  The Borrower shall have the right at any time
and from time to time to prepay any Swingline Loan, in whole or in part, upon
giving written or fax notice (or telephonic notice promptly confirmed by
written notice) to the Swingline Lender and to the Agent before 12:00 (noon),
New York City time on the date of prepayment at the Swingline Lender’s address
for notices specified in its Administrative Questionnaire.

(d)  Each Swingline Loan shall be an ABR Loan and,
subject to the provisions of Section 2.11(c), shall bear interest at the
rate provided for the ABR Revolving Loans as provided in Section 2.11(a).

(e)  The Swingline Lender may by written notice
given to the Agent not later than 11:00 a.m., New York City time, on any
Business Day require the Revolving Credit Lenders to acquire participations on
such Business Day in all or a portion of the Swingline Loans outstanding. Such
notice shall specify the aggregate amount of Swingline Loans in which the
Revolving Credit Lenders will participate. The Agent will, promptly upon
receipt of such notice, give notice to each Revolving Credit Lender, specifying
in such notice such Lender’s Pro Rata Percentage of such Swingline Loan or
Loans. In furtherance of the foregoing, each Revolving Credit Lender hereby
absolutely and unconditionally agrees, upon receipt of notice as provided
above, to pay to the Agent, for the account of the Swingline Lender, such
Revolving Credit Lender’s Pro Rata Percentage of such Swingline Loan or Loans. Each
Revolving Credit Lender acknowledges and agrees that its obligation to acquire
participations in Swingline Loans pursuant to this paragraph is absolute and
unconditional and shall not be affected by any circumstance whatsoever, including
the occurrence and continuance of a Default or an Event of Default, and that
each such payment shall be made without any offset, abatement, withholding or
reduction whatsoever. Each Revolving Credit Lender shall comply with its
obligation under this paragraph by wire transfer of immediately available
funds, in the same manner as provided in Section 2.04(a) with respect
to Loans made by such Lender (and Section 2.04(a) shall apply, mutatis mutandis, to the payment obligations of the Lenders)
and the Agent shall promptly pay to the Swingline Lender the amounts so
received by it from the Lenders. The Agent shall notify the Borrower of any
participations in any Swingline Loan acquired pursuant to this paragraph and
thereafter payments in respect of such Swingline Loan shall be made to the
Agent and not to the Swingline Lender. Any amounts received by the Swingline
Lender from the Borrower (or other party on behalf of the Borrower) in respect
of a Swingline Loan after receipt by the Swingline Lender of the proceeds of a
sale of participations therein shall be promptly remitted to the Agent; any
such amounts received by the Agent shall be promptly remitted by the Agent to
the Lenders that shall have made their payments pursuant to this paragraph and
to the Swingline Lender, as their interests may appear. The purchase of
participations in a Swingline Loan pursuant to this paragraph shall not relieve
the Borrower (or other party liable for obligations of the Borrower) of any
default in the payment thereof.

Section 2.23.          Letters of Credit.  (a)  The
Borrower may request the issuance of a Letter of Credit for its own account or
for the account of any Subsidiary, in a form reasonably acceptable to the Agent
and the Issuing Bank, at any time and from time to time while the Revolving
Credit Commitments remain in effect. This Section shall not be construed
to impose an obligation upon the Issuing Bank to issue any Letter of Credit
that is inconsistent with the terms and conditions of this Agreement. Notwithstanding
any provision of

 

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this Agreement to the contrary, on the Closing Date
all Existing Letters of Credit shall be deemed to be Letters of Credit issued
under this Agreement as of the Closing Date.

(b)  In
order to request the issuance of a Letter of Credit (or to amend, renew or
extend an existing Letter of Credit), the Borrower shall hand deliver or fax to
the Issuing Bank and the Agent (reasonably in advance of the requested date of
issuance, amendment, renewal or extension) a notice requesting the issuance of
a Letter of Credit, or identifying the Letter of Credit to be amended, renewed
or extended, the date of issuance, amendment, renewal or extension, the date on
which such Letter of Credit is to expire (which shall comply with paragraph (c) below),
the amount of such Letter of Credit, the name and address of the beneficiary
thereof and such other information as shall be necessary to prepare such Letter
of Credit. The Issuing Bank shall promptly (i) notify the Agent in writing
of the amount and expiry date of each Letter of Credit issued by it and (ii) provide
a copy of each such Letter of Credit (and any amendments, renewals or
extensions thereof) to the Agent. A Letter of Credit shall be issued, amended,
renewed or extended only if, and upon issuance, amendment, renewal or extension
of each Letter of Credit the Borrower shall be deemed to represent and warrant
that, after giving effect to such issuance, amendment, renewal or extension (i) the
L/C Exposure shall not exceed $50,000,000 and (ii) the Aggregate Revolving
Credit Exposure shall not exceed the Total Revolving Credit Commitment.

(c) 
Each Letter of Credit shall expire at the close of business on the
earlier of the date one year after the date of the issuance of such Letter of
Credit (or such later date as is acceptable to the Issuing Bank in its sole
discretion) and the date that is five Business Days prior to the Revolving
Credit Maturity Date, unless such Letter of Credit expires by its terms on an
earlier date; provided, that a Letter of Credit
may, upon the request of the Borrower, include a provision whereby such Letter
of Credit shall be renewed automatically for additional consecutive periods of
12 months or less (but not beyond the date that is five Business Days prior to
the Revolving Credit Maturity Date) unless the Issuing Bank notifies the
beneficiary thereof at least 30 days prior to the then-applicable expiration
date that such Letter of Credit will not be renewed.

(d)  By
the issuance of a Letter of Credit and without any further action on the part
of the Issuing Bank or the Lenders, the Issuing Bank hereby grants to each
Revolving Credit Lender, and each such Lender hereby acquires from the Issuing
Bank, a participation in such Letter of Credit equal to such Lender’s Pro Rata
Percentage of the aggregate amount available to be drawn under such Letter of
Credit, effective upon the issuance of such Letter of Credit. In consideration
and in furtherance of the foregoing, each Revolving Credit Lender hereby
absolutely and unconditionally agrees to pay to the Agent, for the account of
the Issuing Bank, such Lender’s Pro Rata Percentage of each L/C Disbursement
made by the Issuing Bank and not reimbursed by the Borrower (or, if applicable,
another party pursuant to its obligations under any other Loan Document) forthwith
on the date due as provided in Section 2.02(e). Each Revolving Credit
Lender acknowledges and agrees that its obligation to acquire participations
pursuant to this paragraph in respect of Letters of Credit is absolute and
unconditional and shall not be affected by any circumstance whatsoever,
including the occurrence and continuance of a Default or an Event of Default,
and that each such payment shall be made without any offset, abatement,
withholding or reduction whatsoever.

(e)  If
the Issuing Bank shall make any L/C Disbursement in respect of a Letter of
Credit, the Borrower shall pay to the Agent (or directly to the Issuing Bank,
with concurrent notice to the Agent) an amount equal to such L/C Disbursement
not later than two hours after the Borrower shall have received notice from the
Issuing Bank that payment of such draft will be made, or, if the Borrower shall
have received such notice later than 10:00 a.m., New York City time, on
any Business Day, not later than 10:00 a.m., New York City time, on the
immediately following Business Day.

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(f) 
The Borrower’s obligations to reimburse L/C Disbursements as provided in
paragraph (e) above shall be absolute, unconditional and irrevocable, and
shall be performed strictly in accordance with the terms of this Agreement,
under any and all circumstances whatsoever, and irrespective of:

(i) any
lack of validity or enforceability of any Letter of Credit or any Loan
Document, or any term or provision therein;

(ii) any
amendment or waiver of or any consent to departure from all or any of the
provisions of any Letter of Credit or any Loan Document;

(iii) the
existence of any claim, setoff, defense or other right that the Borrower, any
other party guaranteeing, or otherwise obligated with, the Borrower, any
Subsidiary or other Affiliate thereof or any other person may at any time have
against the beneficiary under any Letter of Credit, the Issuing Bank, the Agent
or any Lender or any other person, whether in connection with this Agreement,
any other Loan Document or any other related or unrelated agreement or
transaction;

(iv) any
draft or other document presented under a Letter of Credit proving to be
forged, fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect;

(v) payment
by the Issuing Bank under a Letter of Credit against presentation of a draft or
other document that does not comply with the terms of such Letter of Credit;
and

(vi) any
other act or omission to act or delay of any kind of the Issuing Bank, the
Lenders, the Agent or any other person or any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of
the Borrower’s obligations hereunder.

Without limiting the generality of the foregoing, it
is expressly understood and agreed that the absolute and unconditional
obligation of the Borrower hereunder to reimburse L/C Disbursements will not be
excused by the gross negligence or willful misconduct of the Issuing Bank. However,
the foregoing shall not be construed to excuse the Issuing Bank from liability
to the Borrower to the extent of any direct damages (as opposed to
consequential damages, claims in respect of which are hereby waived by the
Borrower to the extent permitted by applicable law) suffered by the Borrower
that are caused by the Issuing Bank’s gross negligence or willful misconduct in
determining whether drafts and other documents presented under a Letter of Credit
comply with the terms thereof; it is understood that the Issuing Bank may
accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary and, in making any payment under any Letter of
Credit (i) the Issuing Bank’s exclusive reliance on the documents
presented to it under such Letter of Credit as to any and all matters set forth
therein, including reliance on the amount of any draft presented under such
Letter of Credit, whether or not the amount due to the beneficiary thereunder
equals the amount of such draft and whether or not any document presented
pursuant to such Letter of Credit proves to be insufficient in any respect, if
such document on its face appears to be in order, and whether or not any other
statement or any other document presented pursuant to such Letter of Credit
proves to be forged or invalid or any statement therein proves to be inaccurate
or untrue in any respect whatsoever and (ii) any noncompliance in any
immaterial respect of the documents presented under such Letter of Credit with
the terms thereof shall, in each case, be deemed not to constitute willful
misconduct or gross negligence of the Issuing Bank.

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(g) 
The Issuing Bank shall, promptly following its receipt thereof, examine
all documents purporting to represent a demand for payment under a Letter of
Credit. The Issuing Bank shall as promptly as possible give telephonic
notification, confirmed by fax, to the Agent and the Borrower of such demand
for payment and whether the Issuing Bank has made or will make an L/C
Disbursement thereunder; provided that
any failure to give or delay in giving such notice shall not relieve the
Borrower of its obligation to reimburse the Issuing Bank and the Revolving
Credit Lenders with respect to any such L/C Disbursement. The Agent shall
promptly give each Revolving Credit Lender notice thereof.

(h)  If
the Issuing Bank shall make any L/C Disbursement in respect of a Letter of
Credit, then, unless the Borrower shall reimburse such L/C Disbursement in full
on such date, the unpaid amount thereof shall bear interest for the account of
the Issuing Bank, for each day from and including the date of such L/C
Disbursement, to but excluding the earlier of the date of payment by the
Borrower or the date on which interest shall commence to accrue thereon as
provided in Section 2.02(e), at the rate per annum that would apply to
such amount if such amount were an ABR Revolving Loan.

(i) 
The Issuing Bank may resign at any time by giving 30 days’ prior written
notice to the Agent, the Lenders and the Borrower, and may be removed at any
time by the Borrower by notice to the Issuing Bank, the Agent and the Lenders. Subject
to the next succeeding paragraph, upon the acceptance of any appointment as the
Issuing Bank hereunder by a Lender that shall agree to serve as successor
Issuing Bank, such successor shall succeed to and become vested with all the
interests, rights and obligations of the retiring Issuing Bank and the retiring
Issuing Bank shall be discharged from its obligations to issue additional
Letters of Credit hereunder. At the time such removal or resignation shall
become effective, the Borrower shall pay all accrued and unpaid fees pursuant
to Section 2.10(c)(ii). The acceptance of any appointment as the Issuing
Bank hereunder by a successor Lender shall be evidenced by an agreement entered
into by such successor, in a form satisfactory to the Borrower and the Agent,
and, from and after the effective date of such agreement, (i) such
successor Lender shall have all the rights and obligations of the previous
Issuing Bank under this Agreement and the other Loan Documents and (ii) references
herein and in the other Loan Documents to the term “Issuing Bank” shall be
deemed to refer to such successor or to any previous Issuing Bank, or to such
successor and all previous Issuing Banks, as the context shall require. After
the resignation or removal of the Issuing Bank hereunder, the retiring Issuing
Bank shall remain a party hereto and shall continue to have all the rights and
obligations of an Issuing Bank under this Agreement and the other Loan
Documents with respect to Letters of Credit issued by it prior to such
resignation or removal, but shall not be required to issue additional Letters
of Credit.

(j)  If
any Event of Default shall occur and be continuing, the Borrower shall, on the
Business Day it receives notice from the Agent or the Required Lenders (or, if
the maturity of the Loans has been accelerated, Revolving Credit Lenders
holding participations in outstanding Letters of Credit representing greater
than 50% of the aggregate undrawn amount of all outstanding Letters of Credit)
thereof and of the amount to be deposited, deposit in an account with the Collateral
Agent, for the benefit of the Revolving Credit Lenders, an amount in cash equal
to the L/C Exposure as of such date; provided,
however, that the obligation to
deposit such cash shall become effective immediately, and such deposit shall
become immediately due and payable, without demand or other notice of any kind,
upon the occurrence of any Event of Default with respect to the Borrower
described in clause (f) or (g) of Article VII. Such deposit
shall be held by the Collateral Agent as collateral for the payment and
performance of the Obligations. The Collateral Agent shall have exclusive
dominion and control, including the exclusive right of withdrawal, over such
account. Other than any interest earned on the investment of such deposits in
Permitted Investments, which investments shall be made at the option and sole
discretion of the Collateral Agent, such deposits shall not bear interest. Interest
or profits, if any, on such investments shall accumulate in such account. Moneys
in such account shall (i) automatically be applied by the Agent

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to reimburse the Issuing Bank for L/C Disbursements for which it has
not been reimbursed, (ii) be held for the satisfaction of the
reimbursement obligations of the Borrower for the L/C Exposure at such time and
(iii) if the maturity of the Loans has been accelerated (but subject to
the consent of Revolving Credit Lenders holding participations in outstanding
Letters of Credit representing greater than 50% of the aggregate undrawn amount
of all outstanding Letters of Credit), be applied to satisfy the Obligations. If
the Borrower is required to provide an amount of cash collateral hereunder as a
result of the occurrence of an Event of Default, such amount (to the extent not
applied as aforesaid) shall be returned to the Borrower within three Business
Days after all Events of Default have been cured or waived.

(k) 
The Borrower may, at any time and from time to time with the consent of
the Agent (which consent shall not be unreasonably withheld) and such Lender,
designate one or more additional Lenders to act as an issuing bank under the
terms of the Agreement. Any Lender designated as an issuing bank pursuant to
this paragraph (k) shall be deemed to be an “Issuing Bank” (in addition to
being a Lender) in respect of Letters of Credit issued or to be issued by such
Lender, and, with respect to such Letters of Credit, such term shall thereafter
apply to the other Issuing Bank and such Lender.

Section 2.24.          Increase in Commitments.   (a) 
The Borrower may, by written notice to the Agent from time to time,
request Incremental Term Loan Commitments and Incremental Revolving Credit
Commitments in amounts not to exceed the Incremental Term Loan Amount or the
Incremental Revolving Credit Amount, as applicable, from one or more Incremental
Term Lenders or Incremental Revolving Credit Lenders, as applicable, which may
include any existing Lender (each of which shall be entitled to agree or
decline to participate in its sole discretion); provided
that each Incremental Term Lender and Incremental Revolving Credit Lender, if
not already a Lender hereunder, shall be subject to the approval of the Agent
(which approval shall not be unreasonably withheld). Such notice shall set
forth (i) the amount of the Incremental Term Loan Commitments or
Incremental Revolving Credit Commitments being requested (which shall be in
minimum increments of $1,000,000 and a minimum amount of $5,000,000 or equal to
the remaining Incremental Term Loan Amount or Incremental Revolving Credit
Amount, as applicable), (ii) the date on which such Incremental Term Loan
Commitments or Incremental Revolving Credit Commitments are requested to become
effective (which shall not be less than 10 Business Days after the date of such
notice) and (iii) (x) whether such Incremental Term Loan Commitments
are to be Term Loan Commitments or commitments to make term loans with terms
different from the Term Loans (“Other Term Loans”) and (y) whether
such Incremental Revolving Credit Commitments are to be Revolving Credit
Commitments or commitments to make revolving loans with terms different from
the Revolving Loans (“Other Revolving Loans”).

(b) 
The Borrower and each Incremental Term Lender shall execute and deliver
to the Agent an Incremental Term Loan Assumption Agreement and such other
documentation as the Agent shall reasonably specify to evidence the Incremental
Term Loan Commitment of such Incremental Term Lender. The Borrower and each
Incremental Revolving Credit Lender shall execute and deliver to the Agent an
Incremental Revolving Credit Assumption Agreement and such other documentation
as the Agent shall reasonably specify to evidence the Incremental Revolving
Credit Commitment of such Incremental Revolving Credit Lender. Each Incremental
Term Loan Assumption Agreement and Incremental Revolving Credit Assumption
Agreement shall specify the terms of the Incremental Term Loans or Incremental
Revolving Loans, as applicable, to be made thereunder; provided
that, without the prior written consent of the Required Lenders, (i) the
final maturity date of any Other Term Loans shall be no earlier than the Term
Loan Maturity Date and the final maturity date of any Other Revolving Loans
shall be no earlier than the Revolving Credit Maturity Date and (ii) the
average life to maturity of any Other Term Loans shall be no shorter than the
average life to maturity of the Term Loans and provided
further that, if the interest rate margin in respect of any Other
Term Loan would exceed the Applicable Rate for the Term Loans by more than 1⁄2 of
1%, the Applicable Rate for the Term Loans shall be increased so that the
interest rate margin in respect of such Other Term Loan is no more than 1⁄2 of 1%

 

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higher than the Applicable Rate for the Term Loans. The Agent shall
promptly notify each Lender as to the effectiveness of each Incremental Term
Loan Assumption Agreement and Incremental Revolving Credit Assumption Agreement.
Each of the parties hereto hereby agrees that, upon the effectiveness of any
Incremental Term Loan Assumption Agreement or Incremental Revolving Credit
Assumption Agreement, this Agreement shall be amended to the extent (but only
to the extent) necessary to reflect the existence and terms of the Incremental
Term Loan Commitment or Incremental Revolving Credit Commitment, as applicable,
evidenced thereby as provided for in Section 9.02. Any such deemed
amendment may be memorialized in writing by the Agent with the Borrower’s
consent (not to be unreasonably withheld) and furnished to the other parties
hereto.

(c) 
Notwithstanding the foregoing, no Incremental Term Loan Commitment or
Incremental Revolving Credit Commitment shall become effective under this Section 2.24
unless (i) on the date of such effectiveness, the conditions set forth in
paragraphs (b) and (c) of Section 4.01 shall be satisfied and
the Agent shall have received a certificate to that effect dated such date and
executed by a Financial Officer of the Borrower, (ii) the Agent shall have
received legal opinions, board resolutions and other closing certificates and
documentation consistent with those delivered on the Closing Date and (iii) unless
the Required Revolving Lenders have agreed otherwise, the Borrower would be in
Pro Forma Compliance with the covenant set forth in Section 6.14(a) after
giving effect to such Incremental Term Loan Commitment and the Incremental Term
Loans to be made thereunder and the application of the proceeds therefrom as if
made and applied on such date.

(d) 
Each of the parties hereto hereby agrees that the Agent may take any and
all action as may be reasonably necessary to ensure that all Incremental Term
Loans (other than Other Term Loans), when originally made, are included in each
Borrowing of outstanding Term Loans on a pro rata basis, and the Borrower
agrees that Section 2.14 shall apply to any conversion of LIBOR Rate Term
Loans to ABR Term Loans reasonably required by the Agent to effect the
foregoing.

ARTICLE III

Representations
and Warranties

Each
Loan Party represents and warrants to the Agent, the Issuing Bank and each of
the Lenders that:

Section 3.01.          Organization; Powers.  Each of the Loan Parties and each of its
Subsidiaries is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to own its property and assets and to carry on its business as now
conducted and, except where the failure to do so, individually or in the
aggregate, would not reasonably be expected to result in a Material Adverse
Effect, is qualified to do business in, and is in good standing in, every
jurisdiction where such qualification is required.

Section 3.02.          Authorization;
Enforceability.  The Transactions are
within each applicable Loan Party’s corporate powers and have been duly
authorized by all necessary corporate and, if required, stockholder action of
such Loan Party. Each Loan Document to which each Loan Party is a party have
been duly executed and delivered by such Loan Party and is a legal, valid and
binding obligation of such Loan Party, enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency or similar laws affecting
creditors’ rights generally and to general principles of equity.

Section 3.03.          Governmental Approvals; No
Conflicts.  The Transactions (a) do
not require any consent or approval of, registration or filing with, or any
other action by, any Governmental Authority, except such as have been obtained
or made and are in full force and effect, except for filings necessary to
perfect Liens created

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pursuant to the Loan Documents, (b) will not
violate any Requirement of Law applicable to any Loan Party or any of its
Subsidiaries, (c) will not violate or result in a default under any
indenture, agreement or other instrument binding upon any Loan Party or any of
its Subsidiaries or its assets, or (except for the Existing Bank Debt
Refinancing and the Tender Offer) give rise to a right thereunder to require
any payment to be made by any Loan Party or any of its Subsidiaries, and (d) will
not result in the creation or imposition of any Lien on any asset of any Loan
Party or any of its Subsidiaries, except Liens created pursuant to the Loan
Documents; except, in each case other than with respect to the creation of
Liens, to the extent that any such violation, default or right, or any failure
to obtain such consent or approval or to take any such action, would not
reasonably be expected to result in a Material Adverse Effect.

Section 3.04.          Financial Condition; No
Material Adverse Change.  (a) 
The Borrower has heretofore furnished to the Lenders the consolidated balance
sheet and statements of earnings, shareholders’ equity and cash flows of
Holdings (i) as of and for the fiscal years ended September 30, 2003
and 2004, reported on by Deloitte & Touche LLP, independent public
accountants, and as of and for the fiscal year ended September 30, 2005,
reported on by Ernst & Young LLP, independent public accountants, (ii) as
of and for the fiscal quarters ended December 31, 2005 and April 1,
2006, certified by its Chief Financial Officer and (iii) to the extent
possible in the exercise of the Borrower’s commercially reasonable efforts, as
of and for each subsequent fiscal month ended at least thirty (30) days before
the Closing Date, certified by its chief financial officer. Such financial
statements present fairly, in all material respects, the financial position and
results of operations and cash flows of Holdings and its consolidated
Subsidiaries as of such dates and for such periods in accordance with GAAP,
subject to the absence of footnotes and normal year-end adjustments in the case
of the statements referred to in clauses (ii) and (iii) above.

(b)  The Borrower has heretofore
delivered to the Lenders the unaudited pro forma consolidated balance sheet and
related pro forma statements of earnings, shareholder’s equity and cash flows
of Holdings as of April 1, 2006, prepared giving effect to the
Transactions as if they had occurred, with respect to such balance sheet, on
such date and, with respect to such other financial statements, on the first
day of the 12-month period ending on such date. Such pro forma financial
statements have been prepared in good faith by Holdings, based on the
assumptions used to prepare the pro forma financial information contained in
the Information Memorandum (which assumptions are believed by Holdings on the
date hereof and on the Closing Date to be reasonable), are based on the best
information available to Holdings as of the date of delivery thereof,
accurately reflect all adjustments required to be made to give effect to the
Transactions and present fairly on a pro forma basis the estimated consolidated
financial position of Holdings and its consolidated Subsidiaries as of such
date and for such period, assuming that the Transactions had actually occurred
at such date or at the beginning of such period, as the case may be.

(c)  No event, change or condition has
occurred that has had, or would reasonably be expected to have, a Material
Adverse Effect, since September 30, 2005.

Section 3.05.          Properties.  (a)  As of the date of this Agreement, Schedule 3.05(a) sets forth the address of each parcel
of real property (or each set of parcels that collectively comprise one
operating property) that is owned or leased by each Loan Party, together with a
list of the lessors with respect to all such leased property. Schedule 3.05(a) also identifies the principal place of
business and chief executive office of each Loan Party as of the Closing Date.

(b)  Each of the Borrower and each of
the Subsidiaries has good and insurable fee simple title to, or valid leasehold
interests in, or easements or other limited property interests in, all its real
properties (including all Mortgaged Properties) and has good and marketable
title to its personal property and assets, in each case, except where the failure
to have such title would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect. All such properties and assets are
free and clear of Liens, other than Liens (i) permitted by Section 6.06
or (ii) arising by operation of law

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(which Liens, in the case of this clause (ii) would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect).

(c)  Each of the Borrower and each of
the Subsidiaries has complied with all obligations under all leases to which it
is a party, except where the failure to comply would not reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect, and all
such leases are in full force and effect, except leases in respect of which the
failure to be in full force and effect would not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect. Each of the
Borrower and each of the Subsidiaries enjoys peaceful and undisturbed
possession under all such leases, other than leases in respect of which the
failure to enjoy peaceful and undisturbed possession would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

(d)  As of the Closing Date, none of
Holdings, the Borrower or any Subsidiary has received any notice of, nor has
any knowledge of, any pending or contemplated condemnation proceeding affecting
any material portion of the Mortgaged Properties or any sale or disposition
thereof in lieu of condemnation.

(e)  To the Borrower’s knowledge, as of
the Closing Date, none of the Borrower or any Subsidiary is obligated under any
right of first refusal, option or other contractual right to sell, assign or
otherwise dispose of any Mortgaged Property or any interest therein.

(f)  [Intentionally Omitted.]

(g)  Each of the Borrower and the
Subsidiaries owns or possesses, or is licensed to use, all patents, trademarks,
service marks, trade names and copyrights and all licenses and rights with
respect to the foregoing, necessary for the present conduct of its business,
without any conflict with the rights of others, and free from any burdensome
restrictions on the present conduct of its business, except where such failure
to own, possess or hold pursuant to a license or such conflicts and
restrictions would not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect or except as set forth on Schedule 3.05(g).

Section 3.06.          Litigation and Environmental
Matters.  (a)  Other than the Disclosed
Matters, there are no actions, suits, proceedings or investigations by or
before any arbitrator or Governmental Authority pending against or, to the
knowledge of any Loan Party, threatened against or affecting the Loan Parties
or any of their Subsidiaries (i) as to which there is a reasonable
possibility of an adverse determination and that, if adversely determined,
would reasonably be expected, individually or in the aggregate, to result in a
Material Adverse Effect or (ii) that involve any Loan Documents or the
Transactions.

(b)  Except for the Disclosed Matters or
any other matters that, individually or in the aggregate, would not reasonably
be expected to result in a Material Adverse Effect (i) no Loan Party nor
any of its Subsidiaries has received notice of any claim with respect to any
Environmental Liability or knows of any basis for any Environmental Liability
and (ii) no Loan Party nor any of its Subsidiaries (1) has failed to
comply with any Environmental Law or to obtain, maintain or comply with any
permit, license or other approval required under any Environmental Law or (2) has
become subject to any Environmental Liability.

(c)  Since the date of this Agreement,
there has been no change in the status of the Disclosed Matters that, individually
or in the aggregate, has resulted in, or materially increased the likelihood
of, a Material Adverse Effect.

Section 3.07.          Compliance with Laws and
Agreements; Licenses and Permits. (a) 
Each Loan Party is in compliance with all Requirements of Law applicable to it
or its property and all indentures, agreements and other

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instruments binding upon it or its property, except
where the failure to do so, individually or in the aggregate, would not
reasonably be expected to result in a Material Adverse Effect.

(b)  Each Loan Party and its
Subsidiaries has obtained and holds in full force and effect, all franchises,
licenses, leases, permits, certificates, authorizations, qualifications,
easements, rights of way and other rights and approvals which are necessary or
advisable for the operation of its businesses as presently conducted and as
proposed to be conducted, except where the failure to have so obtained or hold
or to be in force, individually or in the aggregate, would not reasonably be
expected to result in a Material Adverse Effect. No Loan Party or any of its
Subsidiaries is in violation of the terms of any such franchise, license,
lease, permit, certificate, authorization, qualification, easement, right of
way, right or approval, except where any such violation, individually or in the
aggregate, would not reasonably be expected to result in a Material Adverse
Effect.

Section 3.08.          Investment Company Status.  No Loan Party is an “investment company” as
defined in, or is required to be registered under, the Investment Company Act
of 1940.

Section 3.09.          Taxes.  Each Loan Party and its Subsidiaries has
timely filed or caused to be filed all Tax returns and reports required to have
been filed and has paid or caused to be paid all Taxes required to have been paid
by it, except (a) Taxes that are being contested in good faith by
appropriate proceedings and for which such Loan Party or such Subsidiary, as
applicable, has set aside on its books adequate reserves in accordance with
GAAP or (b) to the extent that the failure to do so, individually or in
the aggregate, would not reasonably be expected to result in a Material Adverse
Effect.

Section 3.10.          ERISA.   No
ERISA Event has occurred in the five year period prior to the date on which
this representation is made or deemed made and is continuing or is reasonably
expected to occur that, when taken together with all other such ERISA Events
for which liability is reasonably expected to occur, would reasonably be
expected to result in a Material Adverse Effect. Except as would not reasonably
be expected to have a Material Adverse Effect, the present value of all
accumulated benefit obligations under all Plans (based on the assumptions used
for purposes of Statement of Financial Accounting Standards No. 87) did
not, as of the date of the most recent financial statements reflecting such
amounts, exceed the fair market value of the assets of such Plans, in the
aggregate.

Section 3.11.          Disclosure.  (b)  All written information (other than
the Projections, the pro forma financial statements and estimates and
information of a general economic nature) concerning Holdings, the Borrower,
the Subsidiaries, the Transactions and any other transactions contemplated
hereby included in the Information Memorandum or otherwise prepared by or on
behalf of the foregoing or their representatives and made available to any
Lenders or the Agent in connection with the Transactions on or before the date
hereof (the “Information”), when taken as a whole, as of the date such
Information was furnished to the Lenders (but taking into account supplements
thereto prior to the Closing Date) and as of the Closing Date, did not contain
any untrue statement of a material fact as of any such date or omit to state a
material fact necessary in order to make the statements contained therein not
materially misleading in light of the circumstances under which such statements
were made.

(b)  The Projections, pro forma
financial statements and estimates and information of a general economic nature
prepared by or on behalf of the Borrower or any of its representatives and that
have been made available to any Lenders or the Agent in connection with the
Transactions on or before the date hereof (the “Other Information”) (i) have
been prepared in good faith based upon assumptions believed by the Borrower to
be reasonable as of the date thereof (it being understood that actual results
may vary materially from the Other Information), and (ii) as of the
Closing Date, have not been modified in any material respect by the Borrower.

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Section 3.12.          Material Agreements.  No Loan Party is in default in any material
respect in the performance, observance or fulfillment of any of its obligations
contained in (i) any material agreement to which it is a party or (ii) any
agreement or instrument to which it is a party evidencing or governing Indebtedness, except where any such
default would not reasonably be expected, individually or in the aggregate, to
have a Material Adverse Effect.

Section 3.13.          Solvency.  (a)  Immediately after the consummation
of the Transactions to occur on the Closing Date, (i) the fair value of
the assets of the Loan Parties on a
consolidated basis, at a fair valuation, will exceed the debts and liabilities,
direct, subordinated, contingent or otherwise, of the Loan Parties on a
consolidated basis; (ii) the present fair saleable value of the property
of the Loan Parties on a consolidated basis will be greater than the amount
that will be required to pay the probable liability of the Loan Parties on a
consolidated basis, on their debts and other liabilities, direct, subordinated,
contingent or otherwise, as such debts and other liabilities become absolute
and matured; (iii) the Loan Parties on a consolidated basis will be able
to pay their debts and liabilities, direct, subordinated, contingent or
otherwise, as such debts and liabilities become absolute and matured; and (iv) the
Loan Parties on a consolidated basis will not have unreasonably small capital
with which to conduct the businesses in which they are engaged as such
businesses are now conducted and are proposed to be conducted following the
Closing Date.

(b)  The Loan Parties do not intend to
incur debts beyond their ability to pay such debts as they mature, taking into
account the timing and amounts of cash to be received by the Loan Parties and
the timing and amounts of cash to be payable by the Loan Parties on or in
respect of their Indebtedness.

Section 3.14.          Insurance. Schedule 3.14 sets forth a true, complete and correct
description of all insurance maintained by or on behalf of the Loan Parties and
the Subsidiaries as of the Closing Date. As of the Closing Date, all such
insurance is in full force and effect and all premiums in respect of such insurance have been duly paid. The
Borrower believes that the insurance maintained by or on behalf of the Borrower
and the Subsidiaries is adequate and is in accordance with normal industry
practice.

Section 3.15.          Capitalization and
Subsidiaries. Schedule 3.15 sets forth (a) a correct and
complete list of the name and relationship to the Borrower of each and all of
the Borrower’s Subsidiaries, (b) a true and complete listing of each class
of each of the Borrower’s authorized Equity Interests, of which all of such
issued shares are validly issued, outstanding, fully paid and non-assessable,
and owned beneficially and of record by the Persons identified on Schedule
3.15, and (c) the type of entity of the Borrower  and each of its Subsidiaries. All of the
issued and outstanding Equity Interests of the Subsidiaries owned by any Loan
Party have been (to the extent such concepts are relevant with respect to such
ownership interests) duly authorized and issued and are fully paid and
non-assessable free and clear of all Liens (other than Liens created under the
Loan Documents).

Section 3.16.          Security Interest in
Collateral.  The provisions of this
Agreement and the other Loan Documents create legal and valid Liens on all the
Collateral in favor of the Agent, for the benefit of the Agent and the Lenders;
and upon the proper filing of UCC financing statements required pursuant to Section 4.02(l) and
any Mortgages with respect to Mortgaged Properties in the offices specified on
Schedule 3.16, such Liens constitute perfected and continuing Liens on the
Collateral, securing the Secured Obligations, enforceable against the
applicable Loan Party and all third parties, and having priority over all other
Liens on the Collateral except in the case of (a) Permitted Liens, to the
extent any such Permitted Liens would have priority over the Liens in favor of
the Agent pursuant to any applicable law and (b) Liens perfected only by
possession (including possession of any certificate of title) to the extent the
Agent has not obtained or does not maintain possession of such Collateral.

Section 3.17.          Labor Disputes.  As of the Closing Date, except as,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect: (a) there are no strikes, lockouts or slowdowns
against any

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Loan Party pending or, to the knowledge of the
Borrower, threatened, (b) the hours worked by and payments made to
employees of the Loan Parties and the Subsidiaries have not been in violation
of the Fair Labor Standards Act or any other applicable Federal, state, local
or foreign law dealing with such matters and (c) all payments due from any
Loan Party or any Subsidiary, on account of wages and employee health and
welfare insurance and other benefits, have been paid or accrued as a liability
on the books of the Loan Party or such Subsidiary to the extent required by
GAAP. Except (i) as, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect or (ii) as set
forth on Schedule 3.17, the consummation of the Transactions will
not give rise to a right of termination or right of renegotiation on the part
of any union under any collective bargaining agreement to which Holdings, the
Borrower or any of the Subsidiaries (or any predecessor) is a party or by which
Holdings, the Borrower or any of the Subsidiaries (or any predecessor) is
bound.

Section 3.18.          Federal Reserve Regulations.  (a)  On the Closing Date, none of the
Collateral is Margin Stock.

(b)  None of Holdings, the Borrower and
the Subsidiaries is engaged principally, or as one of its important activities,
in the business of extending credit for the purpose of buying or carrying
Margin Stock.

(c)  No part of the proceeds of any Loan
will be used, whether directly or indirectly, and whether immediately,
incidentally or ultimately, (i) to purchase or carry Margin Stock (other
than pursuant to, or in connection with, the Merger) or to extend credit to
others for the purpose of purchasing or carrying Margin Stock or to refund
indebtedness originally incurred for such purpose, or (ii) for any purpose
that entails a violation of, or that is inconsistent with, the provisions of
Regulation T, U or X.

Section 3.19.          Senior Debt.  The Obligations constitute “Senior Debt” and “Designated
Senior Debt” under and as defined in the Senior Subordinated Note Documents.

ARTICLE IV

Conditions

The
obligations of the Lenders to make Loans and of the Issuing Bank to issue
Letters of Credit hereunder are subject to the satisfaction of the following
conditions:

Section 4.01.          All Credit Events.  On the date of each Borrowing, including each
Borrowing of a Swingline Loan and on the date of each issuance, amendment,
extension or renewal of a Letter of Credit (each such event being called a “Credit
Event”):

(a)  The Agent shall have received a
notice of such Borrowing as required by Section 2.03 (or such notice shall
have been deemed given in accordance with Section 2.02) or, in the case of
the issuance, amendment, extension or renewal of a Letter of Credit, the
Issuing Bank and the Agent shall have received a notice requesting the
issuance, amendment, extension or renewal of such Letter of Credit as required
by Section 2.23(b) or, in the case of the Borrowing of a Swingline
Loan, the Swingline Lender and the Agent shall have received a notice
requesting such Swingline Loan as required by Section 2.22(b). Notwithstanding
the foregoing, the Existing Letters of Credit shall be deemed to be Letters of
Credit issued under this Agreement as of the Closing Date.

(b)  The representations and warranties
set forth in Article III hereof and in each other Loan Document shall be
true and correct in all material respects on and as of the date of such Credit
Event with the same effect as though made on and as of such date, except to the
extent such

 

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representations and warranties expressly
relate to an earlier date, in which case they shall be true and correct in all
material respects on and as of such earlier date.

(c)  At the time of and
immediately after such Credit Event, no Event of Default or Default shall have
occurred and be continuing.

Each Credit Event shall be
deemed to constitute a representation and warranty by the Borrower and Holdings
on the date of such Credit Event as to the matters specified in paragraphs (b) and
(c) of this Section 4.01.

Section 4.02.          Closing Date. On the Closing
Date:

(a) Credit Agreement and Loan Documents. The Agent (or its
counsel) shall have received (i) from each party hereto either (A) a
counterpart of this Agreement signed on behalf of such party or (B) written
evidence satisfactory to the Agent (which may include facsimile transmission of
a signed signature page of this Agreement) that such party has signed a
counterpart of this Agreement and (ii) duly executed copies of the Loan
Documents and such other certificates, documents, instruments and agreements as
the Agent shall reasonably request in connection with the transactions
contemplated by this Agreement and the other Loan Documents, including any
promissory notes requested by a Lender pursuant to Section 2.07.

(b) Legal Opinions. The Agent shall have received, on
behalf of itself, the Lenders and the Issuing Bank on the Closing Date, a
favorable written opinion of (i) Willkie Farr & Gallagher LLP,
special counsel for Holdings and the Borrower, in form and substance reasonably
satisfactory to the Agent and (ii) local or other counsel reasonably
satisfactory to the Agent as specified on Schedule 4.02(b), in each case (A) dated
the Closing Date, (B) addressed to the Agent, the Lenders and the Issuing
Bank and (C) in form and substance reasonably satisfactory to the Agent
and covering such other matters relating to the Loan Documents and the
Transactions as the Agent shall reasonably request.

(c) PATRIOT Act. The Agent shall have received all
documentation and other information reasonably requested by it that is required
by regulatory authorities under applicable “know your customer” and anti-money
laundering rules and regulations, including the USA PATRIOT Act.

(d) Closing Certificates; Certified Certificate of Incorporation;
Good Standing Certificates. The Agent shall have received (i) a
certificate of each Loan Party, dated the Closing Date and executed by its
Secretary or Assistant Secretary or an Officer, which shall (A) certify
the resolutions of its Board of Directors, members or other body authorizing
the execution, delivery and performance of the Loan Documents to which it is a
party, (B) identify by name and title and bear the signatures of the
Financial Officers and any other officers of such Loan Party authorized to sign
the Loan Documents to which it is a party, and (C) contain appropriate
attachments, including the certificate or articles of incorporation or
organization of each Loan Party certified by the relevant authority of the
jurisdiction of organization of such Loan Party and a true and correct copy of
its by-laws or operating, management or partnership agreement, and (ii) a
good standing certificate for each Loan Party from its jurisdiction of
organization.

(e) No Default Certificate. The Agent shall have received a
certificate, signed by the chief financial officer of the Borrower, dated the
Closing Date, confirming compliance with the conditions precedent set forth in
paragraphs (b) and (c) of Section 4.01.

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(f) Fees. The Lenders and the Agent shall have received all
fees required to be paid, and all expenses for which invoices have been
presented (including the reasonable documented fees and expenses of legal
counsel), on or before the Closing Date.

(g) Lien and Judgment Searches. The Agent shall have
received the results of recent lien and judgment searches in each of the
jurisdictions contemplated by the Perfection Certificate, and such search shall
reveal no material judgments and no liens on any of the assets of the Loan
Parties except for Permitted Liens or Liens discharged on or prior to the
Closing Date pursuant to a pay-off letter or other documentation reasonably
satisfactory to the Agent.

(h) Pay-Off Letters. The Agent shall have received pay-off
letters reasonably satisfactory to it in respect of (i) the repayment of
the Existing Borrower Credit Agreement, confirming that all Liens upon any of
the property of the Loan Parties constituting Collateral arising under the
Existing Borrower Credit Agreement, if any, will be terminated concurrently
with such payment and all letters of credit issued or guaranteed as part of
such Indebtedness shall have been cash collateralized or supported by a letter
of credit issued under this Agreement and (ii) the repayment of the
Existing Holdings Credit Agreement, confirming that all Liens upon any of the
property of the Loan Parties constituting Collateral arising under the Existing
Holdings Credit Agreement, if any, will be terminated concurrently with such
payment and all letters of credit issued or guaranteed as part of such
Indebtedness shall have been cash collateralized or supported by a letter of
credit issued under this Agreement.

(i) Solvency. The Agent shall have received a customary
certificate from the chief financial officer of Holdings certifying that
Holdings and its Subsidiaries, on a consolidated basis after giving effect to
the Transactions to occur on the Closing Date, are solvent (within the meaning
of Section 3.13).

(j) Other Financing. The Borrower shall have received gross
cash proceeds of not less than $275,000,000 from the issuance of the Senior
Subordinated Notes.

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

(l) Perfection Certificate; Filings, Registrations and
Recordings. The Agent shall have received a completed Perfection Certificate
dated the Closing Date and signed by a Responsible Officer of the Borrower,
together with all attachments contemplated thereby. Each document (including
any Uniform Commercial Code financing statement) required by the
Collateral Documents or under law or reasonably requested by the Agent to be
filed, registered or recorded in order to create in favor of the Agent, for the
benefit of the Lenders, a perfected Lien on the Collateral described therein,
prior and superior in right to any other Person (other than with respect to
Permitted Liens), shall be in proper form for filing, registration or
recordation. The Agent, on behalf of the Lenders, shall have a security
interest in the Collateral of the type and priority described in the Collateral
Documents (subject to Liens expressly permitted by Section 6.06).

(m) Mortgages, etc. The Agent shall have received, with
respect to each Mortgaged Property, each of the following, in form and
substance reasonably satisfactory to the Agent:

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(i) a
Mortgage on such property;

(ii) evidence
that a counterpart of the Mortgage has been recorded or delivered to the
appropriate Title Insurance Company subject to arrangements reasonably
satisfactory to the Agent for recording promptly following the closing
hereunder, in each case, in the place necessary, in the Agent’s reasonable
judgment, to create a valid and enforceable first priority Lien in favor of the
Agent for the benefit of itself and the Lenders;

(iii) ALTA
or other mortgagee’s title policy;

(iv) an
opinion of counsel in the state in which such parcel of real property is
located in form and substance and from counsel reasonably satisfactory to the
Agent; and

(v) such
other information, documentation, and certifications as may be reasonably
required by the Agent.

provided, that, (i) the amount of debt secured by
each Mortgage in any State that imposes a mortgage tax shall be reasonably
limited to an amount less than the Commitments so as to avoid multiple mortgage
tax assessments and (ii) notwithstanding the foregoing, the conditions set
forth in this clause (m) shall be considered satisfied even if the
Borrower does not deliver such items by the Closing Date, so long as the
Borrower has used commercially reasonable efforts to obtain and deliver such
items to Agent by the Closing Date.

(n) No Material Adverse Effect. Since September 30,
2005, there shall not have occurred any event, change or condition that,
individually or in the aggregate, has had, or would reasonably be expected to
have, a Material Adverse Effect.

(o) Other Indebtedness. The Tender Offer shall have been
consummated in accordance with applicable law and on the terms and conditions
described in the Offer to Purchase and the Existing Bank Debt Refinancing shall
have been effected. After giving effect to the Transactions and the other
transactions contemplated hereby, Holdings, the Borrower and the Subsidiaries
shall not have any outstanding Indebtedness or preferred stock other than (a) the
Obligations, (b)  the Senior Subordinated Notes, (c) any Existing
Notes not tendered for purchase pursuant to the Tender Offer and (d) 
Indebtedness set forth on Schedule 1.01(d).

(p) Insurance. The Agent shall have received evidence of
insurance coverage in form, scope, and substance reasonably satisfactory to the
Agent and otherwise in compliance with the terms of the Guarantee and
Collateral Agreement.

(q) Governmental and Third Party Approvals. All requisite
Governmental Authorities and third parties shall have approved or consented to
the Transactions and the other transactions contemplated hereby to the extent
required and material, and all applicable appeal periods shall have expired.

The Agent shall notify the
Borrower and the Lenders of the Closing Date, and such notice shall be
conclusive and binding.

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ARTICLE V

Affirmative Covenants

Until the Commitments have expired or been terminated
and the principal of and interest on each Loan and all fees and all other
expenses and other amounts payable under any Loan Document shall have been paid
in full and all Letters of Credit have been canceled or have expired and all
amounts drawn thereunder have been reimbursed in full, each Loan Party
executing this Agreement covenants and agrees, jointly and severally with all
of the Loan Parties, with the Lenders that:

Section 5.01.          Financial Statements and Other
Information.  The Borrower will
furnish to the Agent (which will promptly furnish such information to the
Lenders):

(a) within ninety (90) days after the end of each fiscal year
of the Borrower, its audited consolidated balance sheet and related statements
of earnings, shareholders’ equity and cash flows as of the end of and for such
year, setting forth in each case in comparative form the figures for the
previous fiscal year, all reported on by independent public accountants of
recognized national standing and reasonably acceptable to the Agent (without a “going
concern” or like qualification or exception or exception as to the scope of
such audit) to the effect that such consolidated financial statements present
fairly, in all material respects, the financial condition and results of
operations of the Borrower and its consolidated Subsidiaries on a consolidated
basis in accordance with GAAP;

(b) within forty-five (45) days after the end of each of the
first three fiscal quarters of each fiscal year of the Borrower, its
consolidated balance sheet and related statements of earnings, shareholders’
equity and cash flows as of the end of and for such fiscal quarter and the then
elapsed portion of the fiscal year, setting forth in each case in comparative
form the figures for the corresponding period or periods of (or, in the case of
the balance sheet, as of the end of) the previous fiscal year, all certified by
one of its Financial Officers as presenting fairly, in all material respects,
the financial condition and results of operations of the Borrower and its
consolidated Subsidiaries on a consolidated basis in accordance with GAAP,
subject to normal year-end audit adjustments and the absence of footnotes;

(c) concurrently with any delivery of financial statements under
clause (a) or (b) above, a certificate of a Financial Officer of the
Borrower in substantially the form of Exhibit C (i) certifying that
no Event of Default or Default has occurred and, if an Event of Default or Default
has occurred, specifying the details thereof and any action taken or proposed
to be taken with respect thereto and (ii) unless waived by the Required
Revolving Lenders, setting forth computations in reasonable detail satisfactory
to the Agent demonstrating compliance with the covenant set forth in Section 6.14(a) and,
in the case of the financial statements delivered under clause (a), (x) the
Borrower’s calculation of Excess Cash Flow for such fiscal year, and (y) a
list of names of all Immaterial Subsidiaries (if any), that each Subsidiary set
forth on such list individually qualifies as an Immaterial Subsidiary and that
all Domestic Subsidiaries listed as Immaterial Subsidiaries in the aggregate
comprise less than 5% of Total Assets of the Borrower and the Subsidiaries at
the end of the period to which such financial statements relate and represented
(on a contribution basis) less than 5% of Consolidated EBITDA for the period to
which such financial statements relate;

(d) concurrently with any delivery of financial statements under
clause (a) above, a certificate of the accounting firm that reported on
such financial statements stating whether they obtained knowledge during the
course of their examination of such financial statements of any

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Default or
Event of Default (which certificate may be limited to the extent required by
accounting rules or guidelines and may be provided by the Chief Financial
Officer of the Borrower if such accounting firm generally is not providing such
certificates);

(e) concurrently with any delivery of consolidated financial
statements under clause (a) or (b) above, the related unaudited
consolidating financial statements reflecting the adjustments necessary to
eliminate the accounts of Unrestricted Subsidiaries (if any) from such
consolidated financial statements;

(f) within ninety (90) days after the beginning of each fiscal
year, a detailed consolidated budget of the Borrower and its Subsidiaries for
such fiscal year (including a projected consolidated balance sheet and the
related consolidated statements of projected cash flows and projected income as
of the end of and for such fiscal year), including a summary of the underlying
material assumptions with respect thereto;

(g) as soon as practicable upon the reasonable request of the
Agent, deliver an updated Perfection Certificate (or, to the extent such
request relates to specified information contained in the Perfection
Certificate, such information) reflecting all changes since the date of the
information most recently received pursuant to this clause (g) or Section 5.11;

(h) promptly after the same become publicly available, copies of
all periodic and other reports, proxy statements and other materials publicly
filed by Holdings, the Borrower or any Subsidiary with the SEC, or with any
national securities exchange, or distributed to shareholders generally, as the
case may be;

(i) promptly, a copy of any final “management letter” received
from Holdings’s or the Borrower’s independent public accountants to the extent
such independent public accountants have consented to the delivery of such
management letter to the Agent upon the request of Holdings or the Borrower;

(j) promptly following the Agent’s request therefor, all
documentation and other information that the Agent reasonably requests on its
behalf or on behalf of any Lender in order to comply with its ongoing
obligations under applicable “know your customer” and anti-money laundering rules and
regulations, including the USA PATRIOT Act; and

(k) as promptly as reasonably practicable from time to time
following the Agent’s request therefor, such other information regarding the
operations, business affairs and financial condition of Holdings, the Borrower
or any Subsidiary, or compliance with the terms of any Loan Document, as the
Agent may reasonably request (on behalf of itself or any Lender).

Notwithstanding the foregoing, the obligations in
clauses (a) and (b) of this Section 5.01 may be satisfied with
respect to financial information of the Borrower and its Subsidiaries by
furnishing (A) the applicable financial statements of Holdings (or any
direct or indirect parent of Holdings) or (B) the Borrower’s or Holdings’
(or any direct or indirect parent thereof), as applicable, Form 10-K
or 10-Q, as applicable, filed with the SEC; provided that, with respect to each of clauses (A) and
(B), (i) to the extent such information relates to Holdings (or a parent
thereof), such information is accompanied by summary consolidating information
(which may be included in notes to the financial statements) that explains in
reasonable detail the material differences between the information relating to
Holdings (or such parent), on the one hand, and the information relating to the
Borrower and its Subsidiaries on a standalone basis, on the other hand and (ii) to
the extent such information is in lieu of information required to be provided
under clause (a) of this Section 5.01, such materials are
accompanied by a report and opinion of independent public accountants of
recognized national standing and reasonably acceptable

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to the Agent, which report and opinion shall be
prepared in accordance with generally accepted auditing standards and shall not
be subject to any “going concern” or like qualification or exception or any
qualification or exception as to the scope of such audit.

Documents required to be delivered pursuant to clauses
(a), (b) or (h) of this Section 5.01 may be delivered
electronically and if so delivered, shall be deemed to have been delivered on
the date (i) on which the Borrower posts such documents, or provides a
link thereto on the Borrower’s website on the Internet at the website address
listed on Schedule 9.01; or (ii) on which such documents are posted
on the Borrower’s behalf on IntraLinks/IntraAgency or another relevant website,
if any, to which each Lender and the Agent have access (whether a commercial,
third-party website or whether sponsored by the Agent); provided
that:  (i) upon written request by
the Agent, the Borrower shall deliver paper copies of such documents to the
Agent for further distribution to each Lender until a written request to cease
delivering paper copies is given by the Agent and (ii) the Borrower shall
notify (which may be by facsimile or electronic mail) the Agent of the posting
of any such documents and provide to the Agent by electronic mail electronic
versions (i.e., soft copies) of such documents. Notwithstanding anything
contained herein, in every instance the Borrower shall be required to provide
paper copies of the compliance certificates required by clause (c) of
this Section 5.01 to the Agent.

Section
5.02.          Notices of Material
Events.  The Borrower will furnish to
the Agent written notice of the following promptly after any Responsible
Officer of Holdings or the Borrower obtains knowledge thereof:

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

(b) the filing or commencement of, or any written threat or notice
of intention of any person to file or commence, any action, suit or proceeding,
whether at law or in equity or by or before any Governmental Authority or in
arbitration, against Holdings, the Borrower or any of the Subsidiaries thereof
as to which an adverse determination is reasonably probable and which, if
adversely determined, would reasonably be expected to have a Material Adverse
Effect;

(c) any loss, damage, or destruction to the Collateral in the
amount of $10,000,000 or more, whether or not covered by insurance;

(d) any and all default notices received under or with respect to
any leased location or public warehouse where any material Collateral is
located;

(e) the occurrence of any ERISA Event that, together with all
other ERISA Events that have occurred and are continuing, would reasonably be
expected to have a Material Adverse Effect; and

(f) any other development that results in, or would reasonably be
expected to result in, a Material Adverse Effect.

Each notice delivered under
this Section 5.02 shall be accompanied by a statement of a Responsible
Officer of the Borrower setting forth the details of the event or development
requiring such notice and any action taken or proposed to be taken with respect
thereto.

Section 5.03.          Existence; Conduct of Business.
 Each Loan Party will, and will cause
each Subsidiary to, do or cause to be done all things reasonably necessary to
preserve, renew and keep in full force and effect its legal existence and the
rights, qualifications, licenses, permits, franchises, governmental
authorizations, intellectual property rights, licenses and permits (except as
such would otherwise reasonably expire, be abandoned or permitted to lapse in
the ordinary course of business), necessary or desirable in the normal conduct
of its business, and maintain all requisite authority to conduct its business
in each jurisdiction in

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which its business is conducted,
except (i) other than with respect to Holdings’ or the Borrower’s
existence, to the extent such failure to do so would not reasonably be expected
to have a Material Adverse Effect or (ii) pursuant to a transaction
permitted by Section 6.03.

Section 5.04.          Payment of Taxes. Each Loan
Party will, and will cause each 
Subsidiary to, pay or discharge all material Tax liabilities, before the
same shall become delinquent or in default, except where (a) the validity
or amount thereof is being contested in good faith by appropriate proceedings, (b) such
Loan Party or such Subsidiary has set aside on its books adequate reserves with
respect thereto in accordance with GAAP and (c) the failure to make
payment pending such contest would not reasonably be expected to result in a
Material Adverse Effect.

Section 5.05.          Maintenance of Properties.  Each Loan Party will, and will cause each
Subsidiary to (a) at all times maintain and preserve all material property
necessary to the normal conduct of its business in good repair, working order
and condition, ordinary wear and tear excepted and casualty or condemnation
excepted and (b) make, or cause to be made, all needful and proper
repairs, renewals, additions, improvements and replacements thereto as
necessary in accordance with prudent industry practice in order that the
business carried on in connection therewith, if any, may be properly conducted
at all times, except, in each case, where the failure to do so, individually or
in the aggregate, would not reasonably be expected to result in a Material
Adverse Effect.

Section 5.06.          Books and Records; Inspection
Rights.  Each Loan Party will, and
will cause each Subsidiary to, (i) keep proper books of record and account
in accordance with GAAP in which full, true and correct entries are made of all
dealings and transactions in relation to its business and activities and (ii) permit
any representatives designated by the Agent (including employees of the Agent
or any consultants, accountants, lawyers and appraisers retained by the Agent),
upon reasonable prior notice, to visit and inspect its properties, to examine
and make extracts from its books and records, including environmental
assessment reports and Phase I or Phase II studies, and to discuss its affairs,
finances and condition with its officers and independent accountants, all at
such reasonable times during normal business hours and as often as reasonably
requested.

Section 5.07           Maintenance of Ratings.  Holdings and the Borrower shall use their
commercially reasonable efforts to cause the credit facilities provided for
herein to be continuously rated by S&P and Moody’s.

Section 5.08.          Compliance with Laws.  Each Loan Party will, and will cause each
Subsidiary to, comply in all material respects with all Requirements of Law applicable
to it or its property, except where the failure to do so, individually or in
the aggregate, would not reasonably be expected to result in a Material Adverse
Effect.

Section 5.09.          Use of Proceeds.  The proceeds of the Loans will be used only
for the purposes specified in the introductory statement to this Agreement. No
part of the proceeds of any Loan will be used, whether directly or indirectly,
for any purpose that would entail a violation of Regulations T, U or X.

Section 5.10.          Insurance.  Each Loan Party will, and will cause each
Subsidiary to, maintain, with financially sound and reputable insurance
companies (a) insurance in such amounts and against such risks, as are
customarily maintained by similarly situated companies engaged in the same or
similar businesses operating in the same or similar locations (after giving
effect to any self-insurance reasonable and customary for similarly situated
companies) and (b) all insurance required pursuant to the Collateral
Documents (and shall cause the Agent to be listed as a loss payee on property
and casualty policies covering loss or damage to Collateral and as an
additional insured on liability policies, subject, in each case to any
exceptions for insurance required to be maintained under leases). The Borrower
will furnish to the Agent, upon request, information in reasonable detail as to
the insurance so maintained.

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Section 5.11.          Additional Collateral; Further
Assurances.  (a)  Subject to
applicable law, Holdings, the Borrower and each Subsidiary that is a Loan Party
shall cause (i) each of its Domestic Subsidiaries (other than any
Immaterial Subsidiary (except as otherwise provided in paragraph (e) of
this Section 5.11) or Unrestricted Subsidiary) formed or acquired after
the date of this Agreement in accordance with the terms of this Agreement that
is required to become a Subsidiary Guarantor pursuant to Section 6.08 and (ii) any
such Domestic Subsidiary that was an Immaterial Subsidiary but, as of the end
of the most recently ended fiscal quarter of the Borrower has ceased to qualify
as an Immaterial Subsidiary, to become a Loan Party within 20 Business Days by
executing a Joinder Agreement in substantially the form set forth as Exhibit D
hereto (the “Joinder Agreement”). Upon execution and delivery thereof,
each such Person (i) shall automatically become a Loan Party hereunder and
thereupon shall have all of the rights, benefits, duties, and obligations in
such capacity under the Loan Documents and (ii) will simultaneously
therewith or as soon as practicable thereafter grant Liens to the Agent, for
the benefit of the Agent and the Lenders and each other Secured Party at such
time party to or benefiting from the Guarantee and Collateral Agreement to the
extent required by the terms thereof, in any property (subject to the
limitations with respect to Equity Interests set forth in paragraph (b) of
this Section 5.11 and any other limitations set forth in the Guarantee and
Collateral Agreement) of such Loan Party which constitutes Collateral, on such
terms as may be required pursuant to the terms of the Collateral Documents.

(b)  Holdings, the Borrower
and each Subsidiary that is a Loan Party will cause (i) 100% of the issued
and outstanding Equity Interests of each of its Domestic Subsidiaries, other
than any Domestic Subsidiary taxed as a partnership for federal income tax
purposes that holds Capital Stock of a Foreign Subsidiary whose Equity
Interests are pledged pursuant to clause (ii) below, and (ii) 65% of
the issued and outstanding Equity Interests entitled to vote (within the
meaning of Treas. Reg. Section 1.956-2(c)(2)) and 100% of the issued
and outstanding Equity Interests not entitled to vote (within the meaning of
Treas. Reg. Section 1.956-2(c)(2)) in each Foreign Subsidiary
directly owned by the Borrower or any Subsidiary that is a Loan Party to be
subject at all times to a first priority perfected Lien in favor of the Agent
pursuant to the terms and conditions of the Loan Documents or other security
documents as the Agent shall reasonably request; provided, however
this paragraph (b) shall not require the Borrower or any Subsidiary
to grant a security interest in (i) any Equity Interests of a Subsidiary
to the extent a pledge of such Equity Interests in favor of the Agent or to
secure any debt securities of the Borrower or any Subsidiary that would be
entitled to such a security interest would require separate financial
statements of a Subsidiary to be filed with the SEC (or any other government
agency) under Rule 3-10 or Rule 3-16 of Regulation S-X
under the Securities Act (or any successor thereto) or any other law, rule or
regulation or (ii) the Equity Interests of any Unrestricted Subsidiary.

(c)  Without limiting the
foregoing, each Loan Party will, and will cause each Subsidiary that is a Loan
Party to, execute and deliver, or cause to be executed and delivered, to the
Agent such documents, agreements and instruments, and will take or cause to be
taken such further actions (including the filing and recording of financing
statements, fixture filings, mortgages, deeds of trust and other documents and
such other actions or deliveries of the type required by Section 4.02, as
applicable (including the delivery of the items contemplated by paragraph (m) thereof
to the extent the Borrower has been unable to deliver such items by the Closing
Date after having used its commercially reasonable efforts to obtain and
deliver such items by the Closing Date)), which may be required by law or which
the Agent may, from time to time, reasonably request to carry out the terms and
conditions of this Agreement and the other Loan Documents and to ensure
perfection and priority of the Liens created or intended to be created by the
Collateral Documents, all at the expense of the Loan Parties.

(d)  Subject to the limitations
set forth or referred to in this Section 5.11, if any material assets
(including any owned real property or improvements thereto but excluding
leasehold interests) (but only those having a fair market value of at least
$5,000,000) are acquired by the Borrower or any Subsidiary that is a Loan Party
after the Closing Date (other than assets constituting Collateral under the

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Guarantee and Collateral Agreement that
become subject to the Lien in favor of the Agent upon acquisition thereof), the
Borrower will notify the Agent and the Lenders thereof, and, if requested by
the Agent or the Required Lenders, the Borrower will cause such assets to be
subjected to a Lien securing the Secured Obligations and will take, and cause
the Loan Parties that are Subsidiaries to take, such actions as shall be
necessary or reasonably requested by the Agent to grant and perfect such Liens,
including actions described in paragraph (c) of this Section, all at the
expense of the Loan Parties.

(e)  If, at any time and
from time to time after the Closing Date, Domestic Restricted Subsidiaries that
are not Loan Parties because they are Immaterial Subsidiaries comprise in the
aggregate more than 5% of Total Assets as of the end of the most recently ended
fiscal quarter of the Borrower or more than 5% of Consolidated EBITDA of the
Borrower and the Restricted Subsidiaries for the period of four consecutive
fiscal quarters as of the end of the most recently ended fiscal quarter of the
Borrower, then the Borrower shall, not later than 45 days after the date by
which financial statements for such quarter are required to be delivered
pursuant to this Agreement, cause one or more such Domestic Restricted
Subsidiaries to become additional Loan Parties (notwithstanding that such
Domestic Restricted Subsidiaries are, individually, Immaterial Subsidiaries)
such that the foregoing condition ceases to be true.

(f)  Notwithstanding any
provision of the Loan Documents to the contrary, (i) the TD Finance Merger
and the TransDigm Holdings Merger shall be permitted, (ii) TD Finance
shall not be required to become a Loan Party (and no Loan Party shall be
required to pledge any equity interest in TD Finance) unless the TD Finance
Merger fails to occur within 5 Business Days after the Closing Date, in which
case within 10 Business Days after the Closing Date TD Finance shall be
required to satisfy the requirements of this Section 5.11, (iii) TransDigm
Holdings shall not be required to become a Loan Party (and no Loan Party shall
be required to pledge any equity interest in TransDigm Holdings) unless the
TransDigm Holdings Merger fails to occur within 5 Business Days after the
Closing Date, in which case within 10 Business Days after the Closing Date
TransDigm Holdings shall be required to satisfy the requirements of this Section 5.11,
(iv) Sweeney Engineering Corp. shall not be required to become a Loan
Party, and Loan Parties shall not be required to take any actions in respect of
it, until 30 days after the Closing Date; provided nothing in this clause (iv) shall
require any such action to be taken in the event it constitutes an Immaterial
Subsidiary and (v) the Loan Parties shall not be required to include as
Collateral any Excluded Assets (as defined in the Guarantee and Collateral
Agreement).

ARTICLE VI

Negative Covenants

The Loan Parties covenant and agree, jointly and
severally:

(a) with the Lenders and the Issuing Bank that
with respect to Sections 6.01 through Section 6.13, until the Commitments
have expired or terminated and the principal of and interest on each Loan and
all fees, expenses and other amounts payable under any Loan Document have been
paid in full, that:

and

(b) with the Revolving Credit Lenders, the
Swingline Lender and the Issuing Bank that with respect to Section 6.14,
until the Revolving Credit Commitments have expired or terminated and the
principal of and interest on each Revolving Loan and all fees, expenses and
other amounts payable relating to Revolving Credit Loans, Swingline Loans and
Letters of Credit payable under any Loan Document have been paid in full, that:

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Section 6.01.          Limitation on Incurrence of
Additional Indebtedness.  The
Borrower will not, and will not permit any of its Restricted Subsidiaries to,
directly or indirectly, create, incur, assume, guarantee, acquire, become
liable, contingently or otherwise, with respect to, or otherwise become
responsible for payment of (collectively “incur”) any Indebtedness (other than
Permitted Indebtedness); provided, however, that the Borrower and
any Restricted Subsidiary may incur Indebtedness (including, without
limitation, Acquired Indebtedness), in each case if on the date of the
incurrence of such Indebtedness, after giving effect to the incurrence thereof,
the Consolidated Fixed Charge Coverage Ratio of the Borrower would have been
greater than 2.0 to 1.0; provided, however, that the amount of
Indebtedness (including Acquired Indebtedness) that may be incurred pursuant to
the foregoing by Restricted Subsidiaries that are not Subsidiary Guarantors
shall not exceed $50,000,000 at any one time outstanding.

Section 6.02.          Limitation on Restricted Payments.
 The Borrower will not, and will not
cause or permit any of its Restricted Subsidiaries to, directly or indirectly:

(1)  declare or pay any dividend or make any
distribution on or in respect of shares of the Borrower’s or any Restricted
Subsidiary’s Capital Stock to holders of such Capital Stock (other than
dividends or distributions payable in Qualified Capital Stock of the Borrower
and dividends or distributions payable to the Borrower or a Restricted
Subsidiary and other than pro rata dividends or other distributions made by a
Subsidiary that is not a Wholly Owned Subsidiary to minority stockholders (or
owners of an equivalent interest in the case of a Subsidiary that is an entity
other than a corporation));

(2)  purchase, redeem or otherwise acquire or
retire for value any Capital Stock of the Borrower or of any direct or indirect
parent of the Borrower or of a Restricted Subsidiary of the Borrower held by
any Affiliate of the Borrower (other than a Restricted Subsidiary of the
Borrower) or any warrants, rights or options to purchase or acquire shares of
any class of such Capital Stock;

(3)  make any principal payment on, purchase,
defease, redeem, prepay, decrease or otherwise acquire or retire for value,
prior to any scheduled final maturity, scheduled repayment or scheduled sinking
fund payment, any Indebtedness of the Borrower, or of any Guarantor, that is
subordinate or junior in right of payment to the Obligations or any Guarantee,
as applicable (other than (x) any Indebtedness permitted under
clause (6) of the definition of “Permitted Indebtedness” and (y) the
purchase, defeasance or other acquisition of such Indebtedness purchased in
anticipation of satisfying a sinking fund obligation, principal installment or
final maturity, in each case due within one year of such purchase, defeasance
or other acquisition); or

(4)  make any Investment (other than Permitted
Investments) (each of the foregoing actions set forth in clauses (1), (2), (3) and
(4) being referred to as a “Restricted Payment”):

if at the time of such
Restricted Payment or immediately after giving effect thereto:

(i) 
a Default or an Event of Default shall have occurred and be continuing;

(ii) 
the Borrower is not able to incur at least $1.00 of additional Indebtedness
(other than Permitted Indebtedness) in compliance with Section 6.01; and

(iii) 
the aggregate amount of Restricted Payments (including such proposed Restricted
Payment) made subsequent to the Closing Date (other than Restricted Payments
made pursuant to clauses (2), (3), (4), (5), (6), (7), (8), (9), (10) and
(12)  of the following paragraph) shall exceed the sum of, without
duplication:

 

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(v) 
50% of the cumulative Consolidated Net Income (or if cumulative Consolidated
Net Income shall be a loss, minus 100% of such loss) of the Borrower earned
subsequent to April 1, 2006 and on or prior to the date the Restricted
Payment occurs (the “Reference Date”) (treating such period as a single
accounting period); provided that if, at the Reference Date, the
Consolidated Leverage Ratio of the Borrower is less than 4.50 to 1.0, for
purposes of calculating availability of amounts hereunder for such Restricted
Payment only, the reference to 50% in this clause shall be deemed to be 75%;
plus

(w) 
100% of the aggregate net cash proceeds (including the fair market value of
property (as determined by the Borrower in good faith), other than cash, that
would constitute Marketable Securities or a Permitted Business) received by the
Borrower from any Person (other than a Subsidiary of the Borrower) from the
issuance and sale subsequent to the Closing Date and on or prior to the
Reference Date of Qualified Capital Stock of the Borrower (other than Excluded
Contributions); plus

(x) 
without duplication of any amounts included in clause (iii)(w) above,
100% of the aggregate net cash proceeds of any equity contribution received
subsequent to the Closing Date by the Borrower from a holder of the Borrower’s
Capital Stock; plus

(y) 
the amount by which Indebtedness of the Borrower is reduced on the Borrower’s
balance sheet upon the conversion or exchange subsequent to the Closing Date of
any Indebtedness of the Borrower for Qualified Capital Stock of the Borrower
(less the amount of any cash, or the fair value of any other property,
distributed by the Borrower upon such conversion or exchange); provided,
however, that the foregoing amount shall not exceed the net cash proceeds
received by the Borrower or any Restricted Subsidiary from the sale of such
Indebtedness (excluding net cash proceeds from sales to a Subsidiary of the
Borrower or to an employee stock ownership plan or a trust established by the
Borrower or any of its Subsidiaries for the benefit of their employees); plus

(z) 
an amount equal to the sum of (I) 100% of the aggregate net proceeds
(including the fair market value of property other than cash that would
constitute Marketable Securities or a Permitted Business) received by the
Borrower or any Restricted Subsidiary (A) from any sale or other
disposition of any Investment (other than a Permitted Investment) in any Person
(including an Unrestricted Subsidiary) made by the Borrower and its Restricted
Subsidiaries and (B) representing the return of capital or principal
(excluding dividends and distributions otherwise included in Consolidated Net
Income) with respect to such Investment, and (II) the portion
(proportionate to the Borrower’s equity interest in an Unrestricted Subsidiary)
of the fair market value of the net assets of an Unrestricted Subsidiary at the
time such Unrestricted Subsidiary is designated a Restricted Subsidiary; provided,
however, that, in the case of item (II), the foregoing sum shall not
exceed, in the case of any Unrestricted Subsidiary, the amount of Investments
(excluding Permitted Investments) previously made (and treated as a Restricted
Payment) by the Borrower or any Restricted Subsidiary in such Unrestricted
Subsidiary.

Notwithstanding the
foregoing, the provisions set forth in the immediately preceding paragraph do
not prohibit:

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(1)  the payment of
any dividend or the consummation of any irrevocable redemption within
60 days after the date of declaration of such dividend or notice of such
redemption if the dividend or payment of the redemption price, as the case may
be, would have been permitted on the date of declaration or notice;

(2)  any Restricted
Payment made out of the net cash proceeds of the substantially concurrent sale
of, or made by exchange for, Qualified Capital Stock of the Borrower (other
than Capital Stock issued or sold to a Subsidiary of the Borrower or an
employee stock ownership plan or to a trust established by the Borrower or any
of its Subsidiaries for the benefit of their employees and other than
Designated Preferred Stock) or a substantially concurrent cash capital
contribution received by the Borrower from its shareholders; provided, however,
that the net cash proceeds from such sale or such cash capital contribution (to
the extent so used for such Restricted Payment) shall be excluded from the
calculation of amounts under clauses (iii)(w) and (iii)(x) of the
immediately preceding paragraph;

(3)  the acquisition
of any Indebtedness of the Borrower or a Guarantor that is subordinate or
junior in right of payment to the Obligations or the applicable Guarantee
through the application of net proceeds of a substantially concurrent sale for
cash (other than to a Subsidiary of the Borrower) of Refinancing Indebtedness that
is subordinate or junior in right of payment to the Obligations or the
applicable Guarantee;

(4)  payments to a
direct or indirect parent of the Borrower for the purpose of permitting any of
such entities to redeem or repurchase common equity or options in respect
thereof, in each case in connection with the repurchase provisions of employee
stock option or stock purchase agreements or other agreements to compensate
management employees, or upon the death, disability, retirement, severance or
termination of employment of management employees; provided that all
such redemptions or repurchases pursuant to this clause (4) shall not
exceed in any fiscal year the sum of (A) $5,000,000 (with unused amounts
in any calendar year carried over to succeeding calendar years subject to a
maximum (without giving effect to the following clause (B) of
$10,000,000 in any calendar year plus (B) any amounts not utilized in any
preceding fiscal year following the Closing Date that were otherwise available
under this clause for such purchases (which aggregate amount shall be increased
by the amount of any net cash proceeds received from the sale since the Closing
Date of Capital Stock (other than Disqualified Capital Stock) to members of the
Borrower’s management team that have not otherwise been applied to the payment
of Restricted Payments pursuant to the terms of clause (iii) of the
immediately preceding paragraph or clause (2) of this paragraph and
by the cash proceeds of any “key-man” life insurance policies which are used to
make such redemptions or repurchases); provided, further, that
the cancellation of Indebtedness owing to the Borrower from members of
management of the Borrower or any of its Restricted Subsidiaries in connection
with any repurchase of Capital Stock of such entities (or warrants or options
or rights to acquire such Capital Stock) will not be deemed to constitute a
Restricted Payment under this Agreement;

(5)  the declaration
and payment of dividends by the Borrower to, or the making of loans to, its direct
parent company in amounts required for the Borrower’s direct or indirect parent
companies to pay

(A) 
franchise taxes and other fees, taxes and expenses required to maintain their
corporate existence,

(B) 
Federal, state and local income taxes, to the extent such income taxes are
attributable to the income of the Borrower and the Restricted Subsidiaries and,
to the extent of the amount actually received from its Unrestricted
Subsidiaries, in amounts required to pay such taxes to the extent attributable to
the income of such Unrestricted Subsidiaries; provided, however,
that the amount of such payments in any fiscal year do

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not exceed the amount that
the Borrower and its consolidated Subsidiaries would be required to pay in
respect of Federal, state and local taxes for such fiscal year were the
Borrower to pay such taxes as a stand-alone taxpayer,

(C) 
customary salary, bonus and other benefits payable to officers and employees of
any direct or indirect parent company of the Borrower to the extent such salaries,
bonuses and other benefits are attributable to the ownership or operation of
the Borrower and the Restricted Subsidiaries,

(D) 
general corporate overhead expenses of any direct or indirect parent company of
the Borrower to the extent such expenses are attributable to the ownership or
operation of the Borrower and the Restricted Subsidiaries, and

(E) 
reasonable fees and expenses incurred in connection with any unsuccessful debt
or equity offering by such direct or indirect parent company of the Borrower;

(6)  repurchases of
Capital Stock deemed to occur upon the exercise of stock options if such
Capital Stock represents a portion of the exercise price thereof;

(7)  additional
Restricted Payments in an aggregate amount not to exceed $75,000,000;

(8)  Permitted
Transaction Payments;

(9)  payments of
dividends on Disqualified Capital Stock issued in compliance with Section 6.01;

(10)  Restricted
Payments made with Net Cash Proceeds from Asset Sales remaining after
application thereof as required by Section 6.03 and Section 2.20;

(11)  upon occurrence of a Change of Control and
within 60 days after the completion of the Change of Control Offer
pursuant to Section 2.19, any purchase or redemption of obligations of the
Borrower that are subordinate or junior in right of payment to the Obligations
required pursuant to the terms thereof as a result of such Change of Control at
a purchase or redemption price not to exceed 101% of the outstanding principal
amount thereof, plus accrued and unpaid interest thereon, if any; provided,
however, that (A) at the time of such purchase or redemption, no
Default or Event of Default shall have occurred and be continuing (or would
result therefrom) and (B) such purchase or redemption is not made,
directly or indirectly, from the proceeds of (or made in anticipation of) any
issuance of Indebtedness by the Borrower or any Subsidiary; and

(12)  Restricted Payments that are made with
Excluded Contributions.

If the Borrower or any of its Restricted Subsidiaries
become contractually obligated to make any Restricted Payment at the time
criteria set forth in the immediately preceding paragraph of this Section 6.02
continues to be satisfied, then the Borrower or such Restricted Subsidiary, as
the case may be, may continue to make such Restricted Payments, even if the
criteria set forth in the immediately preceding paragraph of this Section 6.02
ceases to be satisfied at the time such Restricted Payment is actually made,
and the amount available for Restricted Payments pursuant to clause (iii) of
the immediately preceding paragraph of this Section 6.02 on or after the
date on which such criteria ceases to be satisfied shall be equal to the amount
that would have been available for Restricted Payments pursuant to such
clause (iii) on such date without giving effect to any Restricted
Payments made on such date pursuant to and in compliance with this paragraph.

The Board of Directors of
the Borrower may designate any Restricted Subsidiary of the Borrower to be an
Unrestricted Subsidiary as specified in the definition of “Unrestricted
Subsidiary.” For purposes of making such determination, all outstanding
Investments by the Borrower and its Restricted Subsidiaries (except to the
extent repaid in cash) in the Subsidiary so designated will be deemed to be
Restricted Payments at the time of the designation and will reduce the amount
available for Restricted

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Payments
under the first paragraph of this Section 6.02. All of those outstanding
Investments will be deemed to constitute Investments in an amount equal to the
fair market value of the Investments at the time of such designation. Such
designation will only be permitted if the Restricted Payment would be permitted
at the time and if the Restricted Subsidiary otherwise meets the definition of
an Unrestricted Subsidiary.

Notwithstanding anything
herein to the contrary, the Borrower and TransDigm Holdings may pay the Closing
Date Dividend.

Section 6.03.          Limitation on Asset Sales.  The Borrower will not, and will not permit any
of its Restricted Subsidiaries to, consummate an Asset Sale unless:

(1)  the Borrower or
the applicable Restricted Subsidiary, as the case may be, receives
consideration at the time of such Asset Sale at least equal to the fair market
value of the assets sold or otherwise disposed of (as determined in good faith
by the Borrower);

(2)  at least 75% of
the consideration received by the Borrower or the Restricted Subsidiary, as the
case may be, from such Asset Sale shall be in the form of cash or Cash
Equivalents; provided that the amount of:

(a)  any liabilities
(as shown on the Borrower’s or such Restricted Subsidiary’s most recent balance
sheet) of the Borrower or any such Restricted Subsidiary (other than
liabilities that are by their terms subordinated to the Obligations) that are
assumed by the transferee of any such assets;

(b)  any notes or
other obligations received by the Borrower or any such Restricted Subsidiary
from such transferee that are converted by the Borrower or such Restricted
Subsidiary into cash within 180 days of the receipt thereof (to the extent
of the cash received); and

(c)  any Designated
Non-cash Consideration received by the Borrower or any of its Restricted
Subsidiaries in such Asset Sale having an aggregate fair market value, taken
together with all other Designated Non-cash Consideration received pursuant to
this clause (c) that is at that time outstanding, not to exceed the
greater of $50,000,000 and 5% of Total Assets at the time of the receipt of
such Designated Non-cash Consideration (with the fair market value of each item
of Designated Non-cash Consideration being measured at the time received and
without giving effect to subsequent changes in value),

shall,
in each of (a), (b) and (c) above, be deemed to be cash for the
purposes of this provision or for purposes of the second paragraph of this Section 6.03;
and

(3)  upon the
consummation of an Asset Sale, the Borrower shall apply, or cause such
Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset
Sale in accordance with Section 2.20.

Notwithstanding the immediately preceding paragraph,
the Borrower and its Restricted Subsidiaries will be permitted to consummate an
Asset Sale without complying with such paragraph to the extent that:

(1)  at least 75% of
the consideration for such Asset Sale constitutes Productive Assets, cash, Cash
Equivalents and/or Marketable Securities; and

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(2)  such Asset Sale
is for fair market value; provided that any consideration consisting of
cash, Cash Equivalents and/or Marketable Securities received by the Borrower or
any of its Restricted Subsidiaries in connection with any Asset Sale permitted
to be consummated under this paragraph shall constitute Net Cash Proceeds
subject to the provisions of the preceding paragraph.

Section 6.04.          Limitation on Dividend and Other
Payment Restrictions Affecting Subsidiaries.  The Borrower will not, and will not cause or
permit any of its Restricted Subsidiaries to, directly or indirectly, create or
otherwise cause or permit to exist or become effective any consensual
encumbrance or consensual restriction on the ability of any Restricted
Subsidiary of the Borrower to:

(1)  pay dividends
or make any other distributions on or in respect of its Capital Stock;

(2)  make loans or
advances or pay any Indebtedness or other obligation owed to the Borrower or
any Guarantor; or

(3)  transfer any of
its property or assets to the Borrower or any Guarantor,

except, with respect to clauses (1), (2) and (3),
for such encumbrances or restrictions existing under or by reason of:

(a)  applicable law,
rule, regulation or order;

(b)  the Senior
Subordinated Note Documents;

(c)  non-assignment
provisions of any contract or any lease of any Restricted Subsidiary of the
Borrower entered into in the ordinary course of business;

(d)  any instrument
governing Acquired Indebtedness, which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other than
the Person or the properties or assets of the Person so acquired;

(e)  the Loan
Documents;

(f)  agreements
existing on the Closing Date to the extent and in the manner such agreements
are in effect on the Closing Date, including the Existing Notes;

(g)  restrictions on
the transfer of assets subject to any Lien permitted under this Agreement imposed
by the holder of such Lien;

(h)  restrictions
imposed by any agreement to sell assets or Capital Stock permitted under this
Agreement to any Person pending the closing of such sale;

(i)  any agreement
or instrument governing Capital Stock of any Person that is acquired;

(j)  [Intentionally
Omitted];

(k)  other
Indebtedness or Permitted Subsidiary Preferred Stock outstanding on the Closing
Date or permitted to be issued or incurred under this Agreement; provided
that any such restrictions are ordinary and customary with respect to the type
of Indebtedness being incurred or Preferred Stock being issued (under the
relevant circumstances):

(l)  restrictions on
cash or other deposits or net worth imposed by customers under contracts
entered into in the ordinary course of business; and

(m)  any
encumbrances or restrictions imposed by any amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements or
refinancings of the contracts, instruments or obligations referred to in clauses

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(a) through (d) and
(f) through (l) above; provided that such amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings are, in the good faith judgment of the Borrower’s
Board of Directors (evidenced by a Board Resolution) whose judgment shall be
conclusively binding, not materially more restrictive with respect to such
dividend and other payment restrictions than those contained in the dividend or
other payment restrictions prior to such amendment, modification, restatement,
renewal, increase, supplement, refunding, replacement or refinancing;

(n)  customary
provisions in joint venture and other similar agreements; and

(o)  customary
provisions in leases and other agreements entered into in the ordinary course
of business.

Section 6.05.          Limitation on Preferred Stock of
Restricted Subsidiaries.  The
Borrower will not permit any of its Restricted Subsidiaries to issue any
Preferred Stock (other than to the Borrower or to a Restricted Subsidiary of
the Borrower) or permit any Person (other than the Borrower or a Restricted
Subsidiary of the Borrower) to own any Preferred Stock of any Restricted
Subsidiary of the Borrower, other than Permitted Subsidiary Preferred Stock.
The provisions of this Section 6.05 will not apply to (w) any of the
Subsidiary Guarantors, (x) any transaction as a result of which neither
the Borrower nor any of its Restricted Subsidiaries will own any Capital Stock
of the Restricted Subsidiary whose Preferred Stock is being issued or sold and (y) Preferred
Stock that is Disqualified Capital Stock and is issued in compliance with Section 6.01.

Section 6.06.          Limitation on Liens.  Holdings and the Borrower will not, and the
Borrower will not permit any of the Subsidiary Guarantors to, directly or
indirectly, create, incur, assume or suffer to exist any Lien (the “Initial
Lien”) that secures obligations under any Indebtedness on any asset or
property of Holdings, the Borrower or any Subsidiary Guarantor now owned or
hereafter acquired, or any income or profits therefrom, or assign or convey any
right to receive income therefrom, except:

(a) in
the case of Collateral, any Initial Lien if (i) such Initial Lien
expressly ranks junior to the first-priority security interest intended to be
created in favor of the Agent for the Secured Parties pursuant to the
Collateral Documents; or (ii) such Initial Lien is a Permitted Lien; and

(b) in
the case of any other asset or property, any Initial Lien if (i) the
Obligations or the applicable Guarantee of a Loan Party, as the case may be,
are equally and ratably secured with (or on a senior basis to, in the case such
Initial Lien secures any Subordinated Indebtedness) the obligations secured by
such Initial Lien or (ii) such Initial Lien is a Permitted Lien.

Any
Lien created for the benefit of the Secured Parties pursuant to clause (b) of
the preceding paragraph shall provide by its terms that such Lien shall be
automatically and unconditionally released and discharged upon the release and
discharge of the Initial Lien (other than through the exercise of remedies with
respect thereto).

Section 6.07.          Merger, Consolidation or Sale of
All or Substantially All Assets. (a)   The Borrower will not, in
a single transaction or series of related transactions, consolidate or merge
with or into any Person, or sell, assign, transfer, lease, convey or otherwise
dispose of (or cause or permit any Restricted Subsidiary of the Borrower to
sell, assign, transfer, lease, convey or otherwise dispose of) all or substantially
all of the Borrower’s assets (determined on a consolidated basis for the
Borrower and the Borrower’s Restricted Subsidiaries) to any Person unless:

(1)  either:

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(a)  the Borrower
shall be the surviving or continuing corporation; or

(b)  the Person (if
other than the Borrower) formed by such consolidation or into which the
Borrower is merged or the Person which acquires by sale, assignment, transfer,
lease, conveyance or other disposition the properties and assets of the
Borrower and of the Borrower’s Restricted Subsidiaries substantially as an
entirety (the “Surviving Entity”):

(x)            shall be a corporation organized and
validly existing under the laws of the United States of America or any State
thereof or the District of Columbia; and

(y)           shall expressly assume all the
obligations of the Borrower under this Agreement and the other Loan Documents
pursuant to supplements to the Loan Documents or other documents or instruments
in form reasonably satisfactory to the Agent;

(2)  except in the
case of a merger of the Borrower with or into a Restricted Subsidiary of the
Borrower and except in the case of a merger entered into solely for the purpose
of reincorporating the Borrower in another jurisdiction, immediately after
giving effect to such transaction and the assumption contemplated by
clause (1)(b)(y) above (including giving effect to any Indebtedness
and Acquired Indebtedness incurred in connection with or in respect of such
transaction), the Borrower or such Surviving Entity, as the case may be, shall
be able to incur at least $1.00 of additional Indebtedness (other than
Permitted Indebtedness) pursuant to Section 6.01 or the Consolidated Fixed
Charge Coverage Ratio for the Surviving Entity and its Restricted Subsidiaries
on a consolidated basis would be greater than such ratio for the Borrower and
the Restricted Subsidiaries immediately prior to such transaction;

(3)  except in the
case of a merger of the Borrower with or into a Restricted Subsidiary of the
Borrower and except in the case of a merger entered into solely for the purpose
of reincorporating the Borrower in another jurisdiction, immediately after
giving effect to such transaction and the assumption contemplated by
clause (1)(b)(y) above (including, without limitation, giving effect
to any Indebtedness and Acquired Indebtedness incurred and any Lien granted in
connection with or in respect of the transaction), no Default or Event of
Default shall have occurred or be continuing;

(4)  [Intentionally
Omitted]; and

(5)  the Borrower or
the Surviving Entity shall have delivered to the Agent an Officers’ Certificate
and an opinion of counsel, each stating that such consolidation, merger, sale,
assignment, transfer, lease, conveyance or other disposition and, such
supplements to the Loan Documents, if any, comply with the applicable
provisions of this Agreement and that all conditions precedent in this
Agreement relating to such transaction have been satisfied.

For purposes of the foregoing, the transfer (by lease,
assignment, sale or otherwise, in a single transaction or series of
transactions) of all or substantially all of the properties or assets of one or
more Restricted Subsidiaries of the Borrower the Capital Stock of which
constitutes all or substantially all of the properties and assets of the Borrower,
shall be deemed to be the transfer of all or substantially all of the
properties and assets of the Borrower. However, transfer of assets between or
among the Borrower and its Restricted Subsidiaries will not be subject to this Section 6.07.

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Upon any consolidation, combination or merger or any
transfer of all or substantially all of the assets of the Borrower in
accordance with the foregoing, in which the Borrower is not the continuing
corporation, the successor Person formed by such consolidation or into which
the Borrower is merged or to which such conveyance, lease or transfer is made
shall succeed to, and be substituted for, and may exercise every right and
power of, the Borrower under the Loan Documents and the Loans with the same
effect as if such surviving entity had been named as such and that, in the
event of a conveyance or transfer (but not a lease), the conveyor or transferor
(but not a lessor) will be released from the provisions of the Loan Documents.

(b)  The Borrower will not permit any Subsidiary
Guarantor to consolidate or merge with or into, or sell, assign, transfer,
lease, convey or otherwise dispose of, in a single transaction or series of
related transactions, all or substantially all of its assets to any Person
unless:

(1)  (except in the
case of a Subsidiary Guarantor that has been disposed of in its entirety to
another Person (other than to the Borrower or an Affiliate of the Borrower),
whether through a merger, consolidation or sale of Capital Stock or through the
sale of all or substantially all of its assets (such sale constituting the
disposition of such Subsidiary Guarantor in its entirety), if in connection
therewith the Borrower provides an Officers’ Certificate to the Agent to the
effect that the Borrower will comply with its obligations under Section 6.03
in respect of such disposition) the resulting, surviving or transferee Person
(if not such Subsidiary Guarantor) shall be a Person organized and validly
existing under the laws of the jurisdiction under which such Subsidiary
Guarantor was organized or under the laws of the United States of America, any
State thereof or the District of Columbia, and such Person shall expressly
assume, by a Joinder Agreement and supplements to the Loan Documents or other
documents or instruments in form reasonably satisfactory to the Agent, all the
obligations of such Subsidiary Guarantor, if any, under its Guarantee;

(2)  except in the
case of a merger of a Subsidiary Guarantor with or into the Borrower or another
Subsidiary Guarantor and except in the case of a merger entered into solely for
the purpose of reincorporating a Subsidiary Guarantor in another jurisdiction,
immediately after giving effect to such transaction and the assumption
contemplated by the immediately preceding clause (1) (including,
without limitation, giving effect to any Indebtedness and Acquired Indebtedness
incurred and any Lien granted in connection with or in respect of the
transaction), no Default or Event of Default shall have occurred and be
continuing; and

(3)  the Borrower
shall have delivered to the Agent an Officers’ Certificate and an opinion of
counsel, each stating that such consolidation, merger, sale, assignment,
transfer, lease, conveyance or other disposition and, such Joinder Agreement
and supplements to the Loan Documents, if any, comply with the applicable
provisions of this Agreement and that all conditions precedent in this
Agreement relating to such transaction have been satisfied.

(c)  Holdings will not consolidate or
merge with or into, or sell, assign, transfer, lease or otherwise dispose of,
in a single transaction or series of related transactions, all or substantially
all of its assets to any Person unless:

(1)  the resulting,
surviving or transferee Person (if not Holdings) shall be a Person organized
and validly existing under the laws of the United States of America, any State
thereof or the District of Columbia, and such Person shall expressly assume, by
a Joinder Agreement and supplements to the Loan Documents or other documents or
instruments in form reasonably satisfactory to the Agent, all the obligations
of Holdings, if any, under its Guarantee;

(2)  except in the
case of a merger entered into solely for reincorporating Holdings in another
jurisdiction, immediately after giving effect to such transaction and the
assumption

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contemplated by the immediately preceding clause (1) (including,
without limitation, giving effect to any Indebtedness and Acquired Indebtedness
incurred and any Lien granted in connection with or in respect of the transaction),
no Default or Event of Default shall have occurred and be continuing; and

(3)  the Borrower
shall have delivered to the Agent an Officers’ Certificate and an opinion of
counsel, each stating that such consolidation, merger, sale, assignment, transfer,
lease, conveyance or other disposition and, such Joinder Agreement and
supplements to the Loan Documents, if any, comply with the applicable
provisions of this Agreement and that all conditions precedent in this
Agreement relating to such transaction have been satisfied.

(d)  Notwithstanding the foregoing, the
TransDigm Holding Company Merger and the TD Finance Merger shall be permitted
without compliance with this Section 6.07.

Section 6.08.          Limitation on Transactions with
Affiliates.  The Borrower will not,
and will not permit any of its Restricted Subsidiaries to, directly or
indirectly, enter into or permit to occur any transaction or series of related
transactions (including, without limitation, the purchase, sale, lease or
exchange of any property or the rendering of any service) with, or for the
benefit of, any of its Affiliates (an “Affiliate Transaction”)involving
aggregate payment or consideration in excess of $10,000,000, unless:

(1)  such Affiliate
Transaction is on terms that are not materially less favorable to the Borrower
or the relevant Restricted Subsidiary than those that might reasonably have
been obtained in a comparable transaction at such time on an arm’s-length
basis from a Person that is not an Affiliate of the Borrower, and

(2)  the
Borrower delivers to the Agent with respect to any Affiliate Transaction or
series of related Affiliate Transactions involving aggregate payments or
consideration in excess of $30,000,000, a Board Resolution adopted by the
majority of the members of the Board of Directors of the Borrower approving
such Affiliate Transaction and set forth in an officers’ certificate certifying
that such Affiliate Transaction complies with clause (1) above.

The restrictions set forth in the first paragraph of
this Section 6.08 shall not apply to:

(1)  reasonable fees
and compensation paid to, and indemnity provided on behalf of, officers,
directors, employees or consultants of the Borrower or any Restricted
Subsidiary of the Borrower as determined in good faith by the Borrower’s Board
of Directors or senior management;

(2)  transactions
between or among the Borrower and any of its Restricted Subsidiaries or between
or among such Restricted Subsidiaries; provided such transactions are
not otherwise prohibited by this Agreement;

(3)  any agreement
as in effect as of the Closing Date or any amendment thereto or any transaction
contemplated thereby (including pursuant to any amendment thereto) or by any
replacement agreement thereto so long as any such amendment or replacement
agreement is not more disadvantageous to the Lenders in any material respect
than the original agreement as in effect on the Closing Date as determined in
good faith by the Borrower;

(4)  Restricted
Payments or Permitted Investments permitted by this Agreement;

(5)  [Intentionally
Omitted];

(6)  the payment of
customary annual management, consulting and advisory fees and related expenses
to the Permitted Holders and their Affiliates made pursuant to any financial
advisory, financing, underwriting or placement agreement or in respect of other
investment

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banking activities, including, without limitation, in
connection with acquisitions or divestitures which are approved by the Board of
Directors of the Borrower or such Restricted Subsidiary in good faith;

(7)  payments or
loans to employees or consultants that are approved by the Board of Directors
of the Borrower in good faith;

(8)  sales of
Qualified Capital Stock;

(9)  the existence
of, or the performance by the Borrower or any of its Restricted Subsidiaries of
its obligations under the terms of, any stockholders’ agreement (including any
registration rights agreement or purchase agreement related thereto) to which
it is a party as of the Closing Date and any similar agreements which it may
enter into thereafter; provided, however, that the existence of,
or the performance by the Borrower or any of its Restricted Subsidiaries of
obligations under, any future amendment to any such existing agreement or under
any similar agreement entered into after the Closing Date shall only be
permitted by this clause (9) to the extent that the terms of any such
amendment or new agreement are not disadvantageous to the Lenders in any
material respect;

(10)  transactions
permitted by, and complying with, the provisions of Section 6.07;

(11)  any issuance of securities or other payments,
awards, grants in cash, securities or otherwise pursuant to, or the funding of,
employment arrangements, stock options and stock ownership plans approved by
the Board of Directors of the Borrower;

(12)  investments by the Permitted Holders in
securities of the Borrower or any of its Restricted Subsidiaries so long as (i) the
investment is being offered generally to other investors on the same or more
favorable terms and (ii) the investment constitutes less than 5.0% of the
proposed or outstanding issue amount of such class of securities; and

(13)  transactions in which the Borrower or any
Restricted Subsidiary, as the case may be, receives an opinion from a
nationally recognized investment banking, appraisal or accounting firm that
such Affiliate Transaction is either fair, from a financial standpoint, to the
Borrower or such Restricted Subsidiary or is on terms not materially less
favorable than those that might reasonably have been obtained in a comparable
transaction at such time on an arm’s length basis from a Person that is not an
Affiliate of the Borrower.

Section 6.09.          Future Guarantees by Restricted
Subsidiaries.  The Borrower will not,
and will not permit any of its Restricted Subsidiaries to, create or acquire
another Domestic Restricted Subsidiary unless such Domestic Restricted
Subsidiary executes and delivers a Joinder Agreement and supplements to the
other Loan Documents, providing for a Guarantee of payment of the Obligations
by such Domestic Restricted Subsidiary; provided, however, that
such Domestic Restricted Subsidiary need not execute and deliver such Joinder
Agreement and supplements to the other Loan Documents for so long as such
Domestic Restricted Subsidiary is an Immaterial Subsidiary (subject to Section 5.11).

Section 6.10.          Business of Borrower and Restricted
Subsidiaries.  The Borrower will not,
and will not permit any of its Restricted Subsidiaries to, engage in any
businesses a majority of whose revenues are not derived from businesses that
are the same or reasonably similar, ancillary or related to, or a reasonable
extension, development or expansion of, the businesses in which the Borrower
and its Restricted Subsidiaries are engaged on the Closing Date (which shall
include, without limitation, engineered components businesses not within the
aerospace industry.

Section 6.11.          Amendments to Subordination
Provisions.  Without the consent of
the Required Lenders, the Borrower will not amend, modify or alter the Senior
Subordinated Notes Indenture in any way to:

 

 90

 

(a)  increase the
rate of or change the time for payment of interest on any Senior Subordinated
Notes;

(b)  increase the
principal of, advance the final maturity date of or shorten the Weighted
Average Life to Maturity of any Senior Subordinated Notes;

(c)  alter the
redemption provisions or the price or terms at which the Borrower is required
to offer to purchase any Senior Subordinated Notes; or

(d)  amend the
provisions of the Senior Subordinated Notes Indenture that relate to
subordination in a manner adverse to the Lenders.

Nothing in this Section 6.11
shall preclude any Loan Party from making any Restricted Payment otherwise
permitted by Section 6.03.

Section 6.12.          Business of Holdings.  Holdings shall not engage in any business
activities or have any material assets or liabilities other than its ownership
of the Equity Interests of the Borrower and assets and liabilities incidental
to its function as a holding company, including its liabilities hereunder and
pursuant to the Guarantee and Collateral Agreement and any other Loan Document.

Section 6.13.          Impairment of Security Interest.
 Subject to the rights of the holders of
Permitted Liens and except as permitted by this Agreement or the Loan
Documents, the Borrower shall not, and shall not permit any of its Restricted
Subsidiaries to, take or knowingly or negligently omit to take, any action
which action or omission would reasonably be expected to have the result of
materially impairing the security interest with respect to a material portion
of the Collateral for the benefit of the Secured Parties.

Section 6.14.          Consolidated Secured Debt Ratio.  (a)  Solely for the purpose of inducing
the Revolving Credit Lenders to provide the Revolving Credit Commitments and
make Revolving Loans hereunder, the Swingline Lender to provide the Swingline
Commitment and make Swingline Loans hereunder and the Issuing Bank to issue
Letters of Credit hereunder, the Loan Parties agree that they shall not permit
the Consolidated Secured Debt Ratio of the Borrower at the end of any fiscal
quarter ending on a date or during a period set forth below to be greater than
the ratio set forth opposite such date or period below.

	
  Date or Period

  	
   

  	
   

  	
   

  	
  Ratio

  	
   

  	
   

  
	
  June 30,
  2006 through September 30, 2007

  	
   

  	
  4.75 to 1.0

  
	
  October 1,
  2007 through September 30, 2008

  	
   

  	
  4.50 to 1.0

  
	
  Thereafter

  	
   

  	
  4.25 to 1.0

  

 

(b)  The Term Lenders acknowledge and
agree that, notwithstanding anything to the contrary herein, the financial
covenant set forth in Section 6.14(a) shall inure only to the benefit
of the Revolving Credit Lenders, the Swingline Lender and the Issuing Bank and
shall under no circumstances inure directly or indirectly under this Section 6.14
or under any other representation, warranty, covenant or default provision
(including those which require compliance with this Section 6.14)  to the benefit of or be enforceable by the
Term Lenders and the Term Lenders shall have no rights or privileges hereunder
with respect to this Section 6.14.

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ARTICLE VII

Events of Default

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

(a) the
Borrower shall fail to pay any principal of any Loan or the reimbursement with
respect to any L/C Disbursement when and as the same shall become due and
payable, whether at the due date thereof or at a date fixed for prepayment
thereof or by acceleration thereof or otherwise;

(b) the
Borrower shall fail to pay any interest on any Loan or L/C Disbursement or any
fee or any other amount (other than an amount referred to in clause (a) of
this Article) payable under this Agreement or any other Loan Document, when and
as the same shall become due and payable, and such failure shall continue
unremedied for a period of thirty (30) days;

(c) any
representation or warranty made or deemed made by or on behalf of any Loan
Party herein or in any other Loan Document or any amendment or modification
thereof or waiver thereunder, or in any report or other certificate, financial
statement or other document furnished pursuant to or in connection with this
Agreement or any Loan Document, shall prove to have been materially incorrect
when made or deemed made and shall remain material at the time tested;

(d) failure
by Holdings, the Borrower or any Subsidiary Guarantor for sixty (60) days after
receipt of written notice given by the Agent or the Required Lenders to comply
with any of its other agreements (other than those set forth in Section 6.14(a) and
in any Collateral Document) in this Agreement or any Loan Document;

(e) (i) any
Loan Party shall fail to make any payment at final stated maturity beyond the
applicable grace period with respect to any Material Indebtedness or the
acceleration of the final stated maturity of any such Material Indebtedness, or
(ii) with respect to the Revolving Credit Lenders, the Swingline Lender
and the Issuing Bank only, any event or condition occurs that enables or
permits (with the giving of notice, if required) the holder or holders of any
such Material Indebtedness or any trustee or agent on its or their behalf to
cause any such Material Indebtedness to become due, or to require the
prepayment, repurchase, redemption or defeasance thereof, prior to its
scheduled maturity; provided that this paragraph (e) shall not apply to
secured Indebtedness that becomes due as a result of the voluntary sale or
transfer of the property or assets securing such Indebtedness if such sale or
transfer is permitted hereunder and under the documents providing for such
Indebtedness;

(f) an
involuntary proceeding shall be commenced or an involuntary petition shall be
filed seeking (i) liquidation, reorganization or other relief in respect
of Holdings, the Borrower or any Significant Subsidiary (or any group of
Subsidiaries that together would constitute a Significant Subsidiary) or its
debts, or of a substantial part of its assets, under any Federal, state or
foreign bankruptcy, insolvency, receivership or similar law now or hereafter in
effect or (ii) the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for Holdings, the Borrower or any
Significant Subsidiary (or any group of Subsidiaries that together would
constitute a Significant Subsidiary) or for a substantial part of its assets,
and, in any such case of clause (i) or (ii), such proceeding or petition
shall continue undismissed and unstayed for sixty (60) days or an
order or decree approving or ordering any of the foregoing shall be entered;

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(g) Holdings,
the Borrower or any Significant Subsidiary (or any group of Subsidiaries that
together would constitute a Significant Subsidiary) shall (i) voluntarily
commence any proceeding or file any petition seeking liquidation,
reorganization or other relief under any Federal, state or foreign bankruptcy,
insolvency, receivership or similar law now or hereafter in effect, (ii) consent
to the institution of, or fail to contest in a timely and appropriate manner,
any proceeding or petition described in clause (f) of this Article, (iii) apply
for or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for Holdings, the Borrower or any
Significant Subsidiary (or any group of Subsidiaries that together would
constitute a Significant Subsidiary) or for a substantial part of its assets, (iv) file
an answer admitting the material allegations of a petition filed against it in
any such proceeding or (v) make a general assignment for the benefit of
creditors;

(h) failure
by Holdings, the Borrower or any Significant Subsidiary (or any group of
Subsidiaries that together would constitute a Significant Subsidiary) to pay
final judgments aggregating in excess of $20,000,000, which final judgments
remain unpaid, undischarged and unstayed for a period of more than sixty
(60) days after such judgment becomes final, and in the event such judgment
is covered by insurance, an enforcement proceeding has been commenced by any
creditor upon such judgment or decree which is not promptly stayed;

(i) the
Guarantee of any Significant Subsidiary (or any group of Subsidiaries that
together would constitute a Significant Subsidiary) or Holdings shall for any
reason cease to be in full force and effect or be declared null and void or any
Responsible Officer of any Subsidiary Guarantor that is a Significant
Subsidiary (or the Responsible Officers of any group of Subsidiaries that
together would constitute a Significant Subsidiary) or Holdings, as the case
may be, denies that it has any further liability under its Guarantee or gives
notice to such effect, other than by reason of the termination of this Agreement
or the release of any such Guarantee in accordance with this Agreement and the
Guarantee and Collateral Agreement;

(j) unless
all of the Collateral has been released from the Liens in accordance with the
provisions of the Collateral Documents, any Collateral Document shall for any
reason cease to be in full force and effect or the assertion by Holdings, the
Borrower or any Restricted Subsidiary, in any pleading in any court of
competent jurisdiction, that any security interest thereunder is invalid or unenforceable
and, in the case of any such Restricted Subsidiary, the failure by the Borrower
to cause such Restricted Subsidiary to rescind such assertions within thirty
(30) days after the Borrower has actual knowledge of such assertions;

(k) the
failure by Holdings, the Borrower or any Restricted Subsidiary to comply for
sixty (60) days after receipt of written notice given by the Agent or the
Required Lenders with its other agreements contained in the Collateral
Documents, except for a failure that would not materially affect the value of
the Collateral, or the remedies with respect thereto, in each case taken as a
whole; or

(l) solely
with respect to the Revolving Credit Lenders, the Swingline Lender and the
Issuing Bank, and only so long as the Revolving Credit Commitments shall not
have been terminated in accordance with Section 2.06, (i) the failure
by Holdings or the Borrower to comply with the covenant set forth in Section 6.14(a) or
(ii) there shall have occurred a Change of Control.

then, and in every such event (other than an event
with respect to any Loan Party described in clauses (f), (g) or (l) of
this Article), and at any time thereafter during the continuance of such event,
the Agent may, and at the request of the Required Lenders shall, by notice to
the Borrower, take any of the following actions, at the same or different
times:  (i) terminate the Commitments, and thereupon the
Commitments 

 93
 

 

shall terminate
immediately and (ii) declare the Loans then outstanding to be due and
payable in whole (or in part, in which case any principal not so declared to be
due and payable may thereafter be declared to be due and payable), and
thereupon the principal of the Loans so declared to be due and payable,
together with accrued interest thereon and all fees and other obligations of
the Borrower accrued hereunder, shall become due and payable immediately,
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Borrower; provided that upon the occurrence of
an event with respect to any Loan Party described in clause (f) or (g) of
this Article, the Commitments shall automatically terminate and the principal
of the Loans then outstanding, together with accrued interest thereon and all
fees and other obligations of the Borrower accrued hereunder, shall
automatically become due and payable, without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrower,
without further action of the Agent or any Lender and provided, further,
that upon the occurrence of an event with respect to any Loan Party described
in clause (l) of this Article, and at any time thereafter during the
continuance of such event, the Agent may, and at the request of Lenders having
Revolving Loans (excluding Swingline Loans), L/C Exposure, Swingline Exposure
and unused Revolving Credit Commitments representing more than 50% of the sum
of all Revolving Loans outstanding (excluding Swingline Loans), L/C Exposure,
Swingline Exposure and unused Revolving Credit Commitments at such time, shall,
by notice to the Borrower, take any of the following actions, at the same or
different times: (x) terminate the Revolving Credit Commitments, the L/C
Commitment and the Swingline Commitment, and thereupon the Revolving Credit
Commitments, the L/C Commitment and the Swingline Commitment shall terminate
immediately and (y) declare the Revolving Loans, L/C Exposure and
Swingline Exposure then outstanding to be due and payable in whole (or in part,
in which case any principal not so declared to be due and payable may
thereafter be declared to be due and payable), and thereupon the principal of
the Revolving Loans, L/C Exposure and Swingline Exposure so declared to be due
and payable, together with accrued interest thereon and all fees and other
obligations relating thereto of the Borrower accrued hereunder, shall become
due and payable immediately, without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrower. Upon the
occurrence and the continuance of an Event of Default, the Agent may, and at
the request of the Required Lenders (or in the event of any Event of Default
specified in clause (l) of the preceding paragraph, Lenders having
Revolving Loans (excluding Swingline Loans), L/C Exposure, Swingline Exposure
and unused Revolving Credit Commitments representing more than 50% of the sum
of all Revolving Loans outstanding (excluding Swingline Loans), L/C Exposure,
Swingline Exposure and unused Revolving Credit Commitments) shall, exercise any
rights and remedies provided to the Agent under the Loan Documents or at law or
equity, including all remedies provided under the UCC.

In the event of any Event of Default specified in
clause (e) of the preceding paragraph of this Article, such Event of
Default and all consequences thereof (excluding any resulting payment default)
shall be annulled, waived and rescinded automatically and without any action by
the Agent or the Lenders if, within twenty (20) days after such Event of
Default arose, (i) the Indebtedness or guarantee that is the basis for
such Event of Default has been discharged, (ii) the holders thereof have
rescinded or waived the acceleration, notice or action (as the case may be)
giving rise to such Event of Default or (iii) the default that is the
basis for such Event of Default has been cured.

Notwithstanding anything to the contrary contained in
this Article VII, in the event that the Borrower would otherwise fail to
comply with the requirements of Section 6.14 (a “Financial Performance
Covenant”), until the expiration of the 10th day subsequent to the date the
certificate calculating the Financial Performance Covenant is required to be
delivered pursuant to Section 5.01(c), the Borrower shall have the right
to issue Permitted Cure Securities (as defined below) for cash or otherwise
receive cash contributions to the capital of the Borrower (the “Cure Right”),
and upon the receipt by Borrower of such cash (the “Cure Amount”)
pursuant to the exercise of such Cure Right, the Financial Performance Covenant
shall be recalculated giving effect to the following pro forma adjustments:

 94
 

 

 

(i)  Consolidated EBITDA shall be increased,
solely for the purpose of measuring the Financial Performance Covenant and not
for any other purpose under this Agreement, by an amount equal to the Cure
Amount; and

(ii) if, after giving effect to the foregoing
recalculations, the Borrower shall then be in compliance with the requirements
of the Financial Performance Covenant, the Borrower shall be deemed to have
satisfied the requirements of the Financial Performance Covenant as of the
relevant date of determination with the same effect as though there had been no
failure to comply therewith at such date, and the applicable breach or default
of the Financial Performance Covenant that had occurred shall be deemed cured
for purposes of this Agreement.

Notwithstanding anything herein to the contrary, (i) in
each four fiscal quarter period there shall be at least one fiscal quarter in
which the Cure Right is not exercised, (ii) in each eight fiscal quarter
period, there shall be at least four fiscal quarters during which the Cure
Right is not exercised and (iii) for purposes of this Article VII,
the Cure Amount shall be no greater than the amount required for purposes of
complying with the Financial Performance Covenant.

As used in this Article VII, the term “Permitted
Cure Securities” shall mean an equity security of the Borrower issued to
Holdings having no mandatory redemption, repurchase, repayment or similar requirements
prior to the six-month anniversary of the Term Loan Maturity Date and upon
which all dividends or distributions, at the election of the Borrower, may be
payable in additional shares of such equity security.

ARTICLE VIII

The Agent

Each of the Lenders and the Issuing Bank hereby
irrevocably appoints the Agent as its agent and authorizes the Agent to take
such actions on its behalf, including execution of the other Loan Documents,
and to exercise such powers as are delegated to the Agent by the terms of the
Loan Documents, together with such actions and powers as are reasonably
incidental thereto.

The bank serving as the Agent hereunder shall have the
same rights and powers in its capacity as a Lender as any other Lender and may
exercise the same as though it were not the Agent, and such bank and its
Affiliates may accept deposits from, lend money to and generally engage in any
kind of business with the Loan Parties or any subsidiary of a Loan Party or
other Affiliate thereof as if it were not the Agent hereunder.

The Agent shall not have any duties or obligations
except those expressly set forth in the Loan Documents. Without limiting the
generality of the foregoing, (a) the Agent shall not be subject to any
fiduciary or other implied duties, regardless of whether a Default has occurred
and is continuing, (b) the Agent shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated by the Loan Documents that the Agent
is required to exercise in writing as directed by the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02), and (c) except as
expressly set forth in the Loan Documents, the Agent shall not have any duty to
disclose, and shall not be liable for the failure to disclose, any information
relating to any Loan Party or any of its Subsidiaries that is communicated to
or obtained by the bank serving as Agent or any of its Affiliates in any
capacity. The Agent shall not be liable for any action taken or not taken by it
with the consent or at the request of the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the circumstances
as provided in Section 9.02) or in the absence of its own gross 

 95
 

 

negligence
or willful misconduct. The Agent shall be deemed not to have knowledge of any
Default unless and until written notice thereof is given to the Agent by the
Borrower or a Lender, and the Agent shall not be responsible for or have any
duty to ascertain or inquire into (i) any statement, warranty or
representation made in or in connection with any Loan Document, (ii) the
contents of any certificate, report or other document delivered hereunder or in
connection with any Loan Document, (iii) the performance or observance of
any of the covenants, agreements or other terms or conditions set forth in any
Loan Document, (iv) the validity, enforceability, effectiveness or
genuineness of any Loan Document or any other agreement, instrument or
document, (v) the creation, perfection or priority of Liens on the
Collateral or the existence of the Collateral, or (vi) the satisfaction of
any condition set forth in Article IV or elsewhere in any Loan Document,
other than to confirm receipt of items expressly required to be delivered to
the Agent.

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

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

Subject to the appointment and acceptance of a
successor Agent as provided in this paragraph, the Agent may resign at any time
by notifying the Lenders, the Issuing Bank and the Borrower. Upon any such
resignation, the Required Lenders shall have the right, with the consent (not
to be unreasonably withheld or delayed) of the Borrower, to appoint a
successor; provided that, during the existence and continuation of an
Event of Default, no consent of the Borrower shall be required. If no successor
shall have been so appointed by the Required Lenders and shall have accepted
such appointment within thirty (30) days after the retiring Agent gives
notice of its resignation, then the retiring Agent may, on behalf of the
Lenders and the Issuing Bank, appoint a successor Agent which shall be a
commercial bank or an Affiliate of any such commercial bank reasonably acceptable
to the Borrower. Upon the acceptance of its appointment as Agent hereunder by a
successor, such successor shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations hereunder. The fees
payable by the Borrower to a successor Agent shall be the same as those payable
to its predecessor unless otherwise agreed between the Borrower and such
successor. After the Agent’s resignation hereunder, the provisions of this Article and
Section 9.03 shall continue in effect for the benefit of such retiring
Agent, its sub-agents and their respective Related Parties in respect of
any actions taken or omitted to be taken by any of them while it was acting as
Agent.

Each Lender acknowledges that it has, independently
and without reliance upon the Agent or any other Lender and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the Agent or
any other Lender and based on such documents and information as it shall from
time to time deem appropriate, continue to make its own 

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decisions
in taking or not taking action under or based upon this Agreement, any other
Loan Document or related agreement or any document furnished hereunder or
thereunder.

The joint lead arrangers, joint bookrunners,
syndication agent and documentation agent shall not have any right, power,
obligation, liability, responsibility or duty under this Agreement other than
those applicable to all Lenders as such.

ARTICLE IX

Miscellaneous

Section 9.01.          Notices. (a)  Except in the case of notices and other
communications expressly permitted to be given by telephone (and subject to
paragraph (b) below), all notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by facsimile, as
follows:

(i) if to
any Loan Party, to the Borrower at:

The Tower at Erieview

1301 East 9th Street, Suite 3710

Cleveland, OH 44114

Attention: Gregory Rufus

Facsimile No: (216) 706-2937

(ii) if
to the Agent, to Credit Suisse at:

Eleven Madison Avenue

New York, NY 10010

Attention: Agency Group

Facsimile No: (212) 325-8304

(iii) if
to any other Lender, to it at its address or facsimile number set forth in its
Administrative Questionnaire.

All such notices and other communications (i) sent
by hand or overnight courier service, or mailed by certified or registered
mail, shall be deemed to have been given when received or (ii) sent by
facsimile shall be deemed to have been given when sent and when receipt has
been confirmed by telephone, provided that if not given during normal
business hours for the recipient, shall be deemed to have been given at the
opening of business on the next Business Day for the recipient.

(b)  Notices and other communications to
the Lenders hereunder may be delivered or furnished by electronic
communications (including e-mail and internet or intranet websites) pursuant to
procedures approved by the Agent; provided that the foregoing shall not
apply to notices pursuant to Article II or to compliance and no Event of
Default certificates delivered pursuant to Section 5.01(d) unless
otherwise agreed by the Agent and the applicable Lender. The Agent or the
Borrower (on behalf of the Loan Parties) may, in its discretion, agree to
accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it; provided that approval of
such procedures may be limited to particular notices or communications. All
such notices and other communications (i) sent to an e-mail address shall
be deemed received upon the sender’s receipt of an acknowledgement from the
intended recipient (such as by the “return receipt requested” function, as
available, return e-mail or other written acknowledgement), provided that if
not given during the normal 

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business hours of the recipient, such notice or communication shall be
deemed to have been given at the opening of business on the next Business Day
for the recipient, and (ii) posted to an Internet or intranet website
shall be deemed received upon the deemed receipt by the intended recipient at
its e-mail address as described in the foregoing clause (b)(i) of
notification that such notice or communication is available and identifying the
website address therefor.

(c)  Any party hereto may change its
address or facsimile number for notices and other communications hereunder by
notice to the other parties hereto.

Section 9.02.          Waivers; Amendments.  (a)  No failure or delay by the Agent,
the Issuing Bank or any Lender in exercising any right or power hereunder or
under any other Loan Document shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The
rights and remedies of the Agent, the Issuing Bank and the Lenders hereunder
and under any other Loan Document are cumulative and are not exclusive of any
rights or remedies that they would otherwise have. No waiver of any provision
of any Loan Document or consent to any departure by any Loan Party therefrom
shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall
be effective only in the specific instance and for the purpose for which given.
Without limiting the generality of the foregoing, to the extent permitted by
law, the making of a Loan shall not be construed as a waiver of any Default,
regardless of whether the Agent or any Lender may have had notice or knowledge
of such Default at the time.

(b)  Neither this Agreement nor any
other Loan Document nor any provision hereof or thereof may be waived, amended
or modified except (i) (x) in the case of this Agreement (except Section 6.14
hereof), pursuant to an agreement or agreements in writing entered into by the
Borrower and the Required Lenders, provided that the Borrower and the Agent may
enter into an amendment to effect the provisions of Section 2.24(b) upon
the effectiveness of any Incremental Term Loan Assumption Agreement or
Incremental Revolving Credit Assumption Agreement and (y) in the case of Section 6.14
of this Agreement, pursuant to an agreement or agreements in writing entered
into by the Borrower and Lenders having Revolving Loans (excluding Swingline
Loans), L/C Exposure, Swingline Exposure and unused Revolving Credit
Commitments representing more than 50% of the sum of all Revolving Loans
outstanding (excluding Swingline Loans), L/C Exposure, Swingline Exposure and
unused Revolving Credit Commitments at such time (the “Required Revolving
Lenders”) or, (ii) in the case of any other Loan Document (other than
any such amendment to effectuate any modification thereto expressly
contemplated by the terms of such other Loan Documents), pursuant to an
agreement or agreements in writing entered into by the Agent and the Loan Party
or Loan Parties that are parties thereto, with the consent of the Required
Lenders; provided that no such agreement shall (A) increase the
Commitment of any Lender without the written consent of such Lender; it being
understood that a waiver of any condition precedent set forth in Section 4.02
or the waiver of any Default or mandatory prepayment shall not constitute an
increase of any Commitment of any Lender, (B) reduce or forgive the
principal amount of any Loan or L/C Disbursement or reduce the rate of interest
thereon, or reduce or forgive any interest or fees (including fees set forth in
Sections 2.08 and 2.19) payable hereunder, without the written consent of each
Lender directly affected thereby, (C) postpone any scheduled date of
payment of the principal amount of any Loan or L/C Disbursement, or any date
for the payment of any interest, fees or other Obligations payable hereunder,
or reduce the amount of, waive or excuse any such payment, or postpone the
scheduled date of expiration of any Commitment, without the written consent of
each Lender directly affected thereby; provided that only the consent of
the Required Lenders shall be necessary to amend the provisions of Section 2.11(c) providing
for the default rate of interest, or to waive any obligations of the Borrower
to pay interest at such default rate, (D) change Sections 2.08(c),
2.09(d), 2.16(c), 2.16(f), 2.19(c) or 2.20(e) in a manner that would
alter the manner in which payments are shared, without the 

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written consent of each Lender, (E) change any of the provisions
of this Section or the definition of “Required Lenders” or any other
provision of any Loan Document specifying the number or percentage of Lenders
required to waive, amend or modify any rights thereunder or make any
determination or grant any consent thereunder, without the written consent of
each Lender, (F) release any material Loan Guarantor from its obligation
under its Guarantee (except as otherwise permitted herein or in the other Loan
Documents), without the written consent of each Lender, or (G) except as
provided in clauses (c) and (d) of this Section or in any
Collateral Document, release all or substantially all of the Collateral,
without the written consent of each Lender; provided further that no
such agreement shall amend, modify or otherwise affect the rights or duties of
the Agent hereunder without the prior written consent of the Agent. The Agent
may without the consent of any Lender also amend the Commitment Schedule
to reflect assignments entered into pursuant to Section 9.04. Upon the
request of the Borrower, the Agent shall enter into such amendments (and may do
so without the consent of any Lender, other agent, or the Issuing Bank) to the
Collateral Documents (or enter into additional Collateral Documents) to secure
on a pari passu basis on terms reasonably acceptable to the Agent all
obligations (including obligations comparable in scope to the Obligations) of
all Other Pari Passu Lien Obligations permitted to be incurred under Section 6.01
and secured by Liens permitted to be incurred under Section 6.06 on all or
a portion of the Collateral.

(c)  The Lenders and the Issuing Bank
hereby irrevocably agree that the Liens granted to the Agent by the Loan
Parties on any Collateral shall be automatically released (i) upon the
termination of the Commitments, payment and satisfaction in full in cash of all
Secured Obligations (other than Unliquidated Obligations), and the cash
collateralization of all Unliquidated Obligations in a manner satisfactory to
the Agent, (ii) upon the sale or other disposition of the property
constituting such Collateral (including as part of or in connection with any other
sale or other disposition permitted hereunder) to any Person other than another
Loan Party, to the extent such sale or other disposition is made in compliance
with the terms of this Agreement (and the Agent may rely conclusively on a
certificate to that effect provided to it by any Loan Party upon its reasonable
request without further inquiry), (iii) to the extent such Collateral is
comprised of property leased to a Loan Party, upon termination or expiration of
such lease, (iv) subject to paragraph (b) of this Section 9.02,
if the release of such Lien is approved, authorized or ratified in writing by
the Required Lenders, (v) to the extent the property constituting such
Collateral is owned by any Loan Guarantor, upon the release of such Guarantor
from its obligations under its Guarantee in accordance with the provisions of
this Agreement and the Guarantee and Collateral Agreement or (vi) as
required to effect any sale or other disposition of such Collateral in
connection with any exercise of remedies of the Agent and the Lenders pursuant
to the Collateral. Any such release shall not in any manner discharge,
affect, or impair the Obligations or any Liens (other than those expressly
being released) upon (or obligations of the Loan Parties in respect of) all
interests retained by the Loan Parties, including the proceeds of any sale, all
of which shall continue to constitute part of the Collateral to the extent
required under the provisions of the Loan Documents.

(d)  Notwithstanding anything to the
contrary contained in this Section 9.02, guarantees, collateral security
documents and related documents executed by Foreign Subsidiaries in connection
with this Agreement may be in a form reasonably determined by the Agent and may
be amended and waived with the consent of the Agent at the request of the
Borrower without the need to obtain the consent of any other Lenders if such
amendment or waiver is delivered in order (i) to comply with local law or
advice of local counsel, (ii) to cure ambiguities or defects or (iii) to
cause such guarantee, collateral security document or other document to be
consistent with this Agreement and the other Loan Documents.

(e)  If, in connection with any proposed
amendment, waiver or consent requiring the consent of “each Lender” or “each
Lender directly affected thereby”, the consent of the Required Lenders is
obtained, but the consent of other necessary Lenders is not obtained (any such
Lender whose consent is necessary but not obtained being referred to herein as
a “Non-Consenting Lender”), then (x) the Agent 

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may elect to purchase all (but not less than all) of (1) any Class of
such Lender’s Commitments, the corresponding Loans owing to it and other
Obligations due to it and all of its rights and obligations hereunder and under
the other Loan Documents in respect of such Class or (2) such Lender’s
Commitments, the Loans owing to it and other Obligations due to it and all of
its rights and obligations hereunder and under the other Loan Documents, provided
that the Borrower shall pay to such Non-Consenting Lender in same day funds on
the day of such purchase all interest, fees and other amounts then accrued but
unpaid to such Non-Consenting Lender by the Borrower hereunder to and including
the date of termination, including without limitation, payments due to such
Non-Consenting Lender under Section 2.13 and 2.15 and an amount, if any,
equal to the payment which would have been due to such Lender on the day of
such purchase under Section 2.14 had the Loans of such Non-Consenting
Lender been prepaid on such date rather than sold to the Agent or (y) the
Borrower may elect to replace a Non-Consenting Lender as a Lender party to this
Agreement, provided that, concurrently with such replacement by the
Borrower, (i) another bank or other entity which is reasonably
satisfactory to the Borrower and the Agent shall agree, as of such date, to
purchase for cash the Loans and other Obligations due to the Non-Consenting
Lender pursuant to an Assignment and Assumption and to become a Lender for all
purposes under this Agreement and to assume all obligations of the
Non-Consenting Lender to be terminated as of such date and to comply with the
requirements of clause (b) of Section 9.04, (ii) the replacement
Lender shall grant its consent with respect to the applicable proposed
amendment, waiver or consent and (iii) the Borrower shall pay to such
Non-Consenting Lender in same day funds on the day of such replacement (1) all
interest, fees and other amounts then accrued but unpaid to such Non-Consenting
Lender by the Borrower hereunder to and including the date of termination,
including without limitation payments due to such Non-Consenting Lender under
Sections 2.13 and 2.15, and (2) an amount, if any, equal to the payment
which would have been due to such Lender on the day of such replacement under Section 2.14
had the Loans of such Non-Consenting Lender been prepaid on such date rather
than sold to the replacement Lender. Each Lender agrees that if the Agent or
the Borrower, as the case may be, exercises its option hereunder, it shall
promptly execute and deliver all agreements and documentation necessary to
effectuate such assignment as set forth in Section 9.04. The Agent or the
Borrower shall be entitled (but not obligated) to execute and deliver such agreement
and documentation on behalf of such Non-Consenting Lender and any such
agreement and/or documentation so executed by the Agent or the Borrower shall
be effective for purposes of documenting an assignment pursuant to Section 9.04.

Section 9.03.          Expenses; Indemnity; Damage Waiver.  (a)  The Borrower shall pay (i) all
reasonable documented out-of-pocket expenses incurred by the Agent
and its Affiliates, including the reasonable fees, charges and disbursements of
Latham & Watkins LLP, counsel for the Agent, in connection with the
syndication and distribution (including, without limitation, via the internet
or through a service such as Intralinks) of the credit facilities provided for
herein, the preparation of the Loan Documents and related documentation, (ii) all
reasonable documented out-of-pocket expenses incurred by the Agent and its
Affiliates, including the reasonable fees, charges and disbursements of outside
legal counsel to the Agent, in connection with any amendments, modifications or
waivers of the provisions of any Loan Documents (whether or not the
transactions contemplated thereby shall be consummated), (iii) all
reasonable documented out-of-pocket expenses incurred by the Agent, the Issuing
Bank or the Lenders, including the reasonable documented fees, charges and
disbursements of any counsel for the Agent and for one law firm retained by the
Lenders, in connection with the enforcement, collection or protection of its
rights in connection with the Loan Documents, including its rights under this
Section, or in connection with the Loans made hereunder, including all such
reasonable documented out-of-pocket expenses incurred during any workout,
restructuring or related negotiations in respect of such Loans, and (iv) subject
to any other provisions of this Agreement, of the Loan Documents or of any
separate agreement entered into by the Borrower and the Agent with respect
thereto, all reasonable documented out-of-pocket expenses incurred by the Agent
in the administration of the Loan Documents. Expenses reimbursable by the
Borrower under this Section include, without limiting the generality of
the foregoing, subject to any other applicable

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provision of any Loan Document,
reasonable documented out-of-pocket costs and expenses incurred in connection
with:

(i) lien and title searches and title insurance; and

(ii) taxes, fees and other charges for recording the Mortgages,
filing financing statements and continuations, and other actions to perfect,
protect, and continue the Agent’s Liens.

Other than to the extent
required to be paid on the Closing Date, all amounts due under this paragraph (a) shall
be payable by the Borrower within ten (10) Business Days of receipt of an
invoice relating thereto and setting forth such expenses in reasonable detail.

(b)  The Borrower shall
indemnify the Agent, the Issuing Bank and each Lender, and each Related Party
of any of the foregoing Persons (each such Person being called an “Indemnitee”)
against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, penalties, liabilities and related expenses, including the fees,
charges and disbursements of any counsel for any Indemnitee, incurred by or
asserted against any Indemnitee arising out of, in connection with, or as a
result of (i) the execution or delivery of the Loan Documents or any
agreement or instrument contemplated thereby, the performance by the parties
hereto of their respective obligations thereunder or the consummation of the
Transactions or any other transactions contemplated hereby, (ii) any
Environmental Liability related in any way to the Borrower or any of its
Subsidiaries or to any property owned or operated by the Borrower or any of its
Subsidiaries, or (iii) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory and regardless of whether any Indemnitee is
a party thereto (and regardless of whether such matter is initiated by a third
party or by the Borrower, any other Loan Party or any of their respective
Affiliates); provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, penalties,
liabilities or related expenses are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the
gross negligence or willful misconduct of such Indemnitee.

(c)  To the extent that the
Borrower fails to pay any amount required to be paid by it to the Agent under
paragraph (a) or (b) of this Section, each Lender severally agrees to
pay to the Agent such Lender’s Applicable Percentage (determined as of the time
that the applicable unreimbursed expense or indemnity payment is sought) of
such unpaid amount; provided that the unreimbursed expense or indemnified loss,
claim, damage, penalty, liability or related expense, as the case may be, was
incurred by or asserted against the Agent in its capacity as such.

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

(e)  All amounts due under
this Section shall be paid promptly after written demand therefor.

Section
9.04.          Successors and Assigns.  (a)  The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that (i) the
Borrower may not assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by the Borrower without such consent shall be null and
void) and (ii) no Lender may assign or otherwise transfer its rights or
obligations hereunder except in accordance with this Section (any
attempted assignment or transfer not 

 

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complying with the terms of this
Section shall be null and void). Nothing in this Agreement, expressed or
implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby, Participants
(to the extent provided in paragraph (c) of this Section) and, to the
extent expressly contemplated hereby, the Related Parties of each of the Agent
and the Lenders) any legal or equitable right, remedy or claim under or by
reason of this Agreement.

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

(A) the Borrower,
provided that no consent of the Borrower shall be required for an
assignment to another Lender, an Affiliate of a Lender, an Approved Fund or, if
an Event of Default specified in paragraphs (a), (b), (f) or (g) of Article VII
has occurred and is continuing, any other Eligible Assignee and provided
further that no consent of the Borrower shall be required for an
assignment during the primary syndication of the Loans to Persons identified by
the Agent to the Borrower on or prior to the Closing Date and reasonably
acceptable to the Borrower;

(B) the Agent;
and

(C) the Swingline
Lender and the Issuing Bank, in the case of any assignment of a Revolving Credit
Commitment.

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

(A) except in the
case of an assignment to another Lender, an Affiliate of a Lender or an
Approved Fund or an assignment of the entire remaining amount of the assigning
Lender’s Commitment or Loans, the amount of the Commitment or the principal
amount of Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Agent and determined on an aggregate basis in
the event of concurrent assignments to Related Funds (as defined below)) shall
be an integral multiple of $5,000,000 and not less than $5,000,000 in the case
of Revolving Credit Commitments or Revolving Loans and an integral multiple of
$1,000,000 and not less than $1,000,000 in the case of Term Loan Commitments or
Term Loans unless each of the Borrower and the Agent otherwise consent, provided
that no such consent of the Borrower shall be required if an Event of Default
specified in paragraphs (a), (b), (f) or (g) of Article VII has
occurred and is continuing;

(B) each partial
assignment shall be made as an assignment of a proportionate part of all the
assigning Lender’s rights and obligations under this Agreement;

(C) the parties
to each assignment shall execute and deliver to the Agent an Assignment and
Assumption via an electronic settlement system acceptable to the Agent (or, if
previously agreed with the Agent, manually); and

(D)  the
assignee, if it shall not be a Lender, shall deliver on or prior to the
effective date of such assignment, to the Agent (1) an Administrative
Questionnaire and (2) if applicable, an appropriate Internal Revenue
Service form (such as Form W-8BEN or W-8ECI or any successor
form adopted by the relevant United States taxing authority) as required by
applicable law supporting such assignee’s position that no withholding by any
Borrower or the Agent for United 

 

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States
income tax payable by such assignee in respect of amounts received by it
hereunder is required.

The term “Related Funds” shall mean with respect
to any Lender that is an Approved Fund, any other Approved Fund that is managed
or advised by the same investment advisor as such Lender or by an Affiliate of
such investment advisor.

(iii) Subject to
acceptance and recording thereof pursuant to paragraph (b)(iv) of
this Section, from and after the effective date specified in each Assignment
and Assumption the assignee thereunder shall be a party hereto and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this
Agreement (and, in the case of an Assignment and Assumption covering all of the
assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto but shall continue to be entitled to the benefits
of Sections 2.13, 2.14, 2.15 and 9.03 with respect to facts and
circumstances occurring on or prior to the effective date of such assignment). Any
assignment or transfer by a Lender of rights or obligations under this
Agreement that does not comply with this Section 9.04 shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in such
rights and obligations in accordance with paragraph (c) of this Section.

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

(v) Upon its
receipt of a duly completed Assignment and Assumption executed by an assigning
Lender and an assignee, the assignee’s completed Administrative Questionnaire
and tax certifications required by Section 9.04(b)(ii)(D)(2)(unless the
assignee shall already be a Lender hereunder), the processing and recordation
fee referred to in paragraph (b) of this Section and any written
consent to such assignment required by paragraph (b) of this Section, the
Agent shall accept such Assignment and Assumption and record the information
contained therein in the Register; provided that if either the assigning
Lender or the assignee shall have failed to make any payment required to be
made by it pursuant to Section 2.04(a), 2.16(c) or 9.03(c), the Agent
shall have no obligation to accept such Assignment and Assumption and record
the information therein in the Register unless and until such payment shall
have been made in full, together with all accrued interest thereon. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.

(vi) By executing
and delivering an Assignment and Assumption, the assigning Lender thereunder
and the assignee thereunder shall be deemed to confirm to and agree with each
other and the other parties hereto as follows:  (i) such
assigning Lender warrants that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim and that
its Commitment, and the outstanding balances of its Loans, in each case without
giving effect to assignments thereof which have not become effective, are as
set forth in such Assignment and Assumption, (ii) except as set forth in (i) above,
such assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement, or 

 

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the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement, any other Loan Document or any other instrument or
document furnished pursuant hereto, or the financial condition of the Borrower
or any Subsidiary or the performance or observance by the Borrower or any
Subsidiary of any of its obligations under this Agreement, any other Loan
Document or any other instrument or document furnished pursuant hereto; (iii) such
assignee represents and warrants that it is an Eligible Assignee, legally
authorized to enter into such Assignment and Assumption; (iv) such
assignee confirms that it has received a copy of this Agreement, together with
copies of the most recent financial statements referred to in Section 3.04(a) or
delivered pursuant to Section 5.01 and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Assumption; (v) such assignee
will independently and without reliance upon the Agent, such assigning Lender
or any other Lender and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement; (vi) such assignee
appoints and authorizes the Agent to take such action as agent on its behalf
and to exercise such powers under this Agreement as are delegated to the Agent,
by the terms hereof, together with such powers as are reasonably incidental
thereto; and (vii) such assignee agrees that it will perform in accordance
with their terms all the obligations which by the terms of this Agreement are
required to be performed by it as a Lender.

(c)  (i)  Any
Lender may, without the consent of the Borrower or the Agent, sell
participations to one or more banks or other entities (a “Participant”)
in all or a portion of such Lender’s rights and obligations under this
Agreement (including all or a portion of its Commitment or the Loans owing to
it); provided that (A) such Lender’s obligations under this
Agreement shall remain unchanged, (B) such Lender shall remain solely responsible
to the other parties hereto for the performance of such obligations, (C) the
Borrower, the Agent, and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement and (D) no such Participant shall be a “creditor”
as defined in Regulation T or a “foreign branch of a broker-dealer” within the
meaning of Regulation X. Any agreement or instrument pursuant to which a
Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that
such agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver
described in the first proviso to Section 9.02(b) that affects such
Participant. Subject to paragraph (c)(ii) of this Section, the
Borrower agrees that each Participant shall be entitled to the benefits of
Sections 2.13, 2.14 and 2.15 to the same extent as if it were a Lender and
had acquired its interest by assignment pursuant to paragraph (b) of
this Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 9.08 as though it were a Lender,
provided such Participant agrees to be subject to Section 2.16(c) as
though it were a Lender.

(ii)  A Participant
shall not be entitled to receive any greater payment under Section 2.13 or
2.15 than the applicable Lender would have been entitled to receive with
respect to the participation sold to such Participant, unless the sale of the
participation to such Participant is made with the Borrower’s prior written
consent. A Participant that would be a Foreign Lender if it were a Lender shall
not be entitled to the benefits of Section 2.15 unless the Borrower is
notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 2.15(e) as
though it were a Lender.

(d)  Any Lender may at any
time pledge or assign a security interest in all or any portion of its rights
under this Agreement to secure obligations of such Lender, including without
limitation any pledge or assignment to secure obligations to a Federal Reserve
Bank, and this Section shall not apply to any such pledge or assignment of
a security interest; provided that no such pledge or assignment of a 

 

 104
 

 

security interest shall release a Lender from
any of its obligations hereunder or substitute any such pledgee or assignee for
such Lender as a party hereto.

(e)  Notwithstanding
anything to the contrary contained herein, any Lender (a “Granting Lender”)
may grant to a special purpose funding vehicle (an “SPC”), identified as
such in writing from time to time by the Granting Lender to the Agent and the
Borrower, the option to provide to the Borrower all or any part of any Loan
that such Granting Lender would otherwise be obligated to make to the Borrower
pursuant to this Agreement; provided that (i) nothing herein
shall constitute a commitment by any SPC to make any Loan, (ii) if an SPC
elects not to exercise such option or otherwise fails to provide all or any
part of such Loan, the Granting Lender shall be obligated to make such Loan
pursuant to the terms hereof and (iii) no SPC shall be a “creditor” as
defined in Regulation T or a “foreign branch of a broker-dealer” within
the meaning of Regulation X. The making of a Loan by an SPC hereunder
shall utilize the Commitment of the Granting Lender to the same extent, and as
if, such Loan were made by such Granting Lender. Each party hereto hereby
agrees that (i) neither the grant to any SPC nor the exercise by any SPC
of such option shall increase the costs or expenses or otherwise increase or
change the obligations of the Borrower under this Agreement (including its
obligations under Section 2.13, 2.14 or 2.15), (ii) no SPC shall be
liable for any indemnity or similar payment obligation under this Agreement
(all liability for which shall remain with the Granting Lender) and (iii) the
Granting Lender shall for all purposes including approval of any amendment,
waiver or other modification of any provision of the Loan Documents, remain the
Lender of record hereunder. In furtherance of the foregoing, each party hereto
hereby agrees (which agreement shall survive the termination of this Agreement)
that, prior to the date that is one year and one day after the payment in full
of all outstanding commercial paper or other senior indebtedness of any SPC, it
will not institute against, or join any other Person in instituting against,
such SPC any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under the laws of the United States or any state thereof. In addition,
notwithstanding anything to the contrary contained in this Section 9.04,
any SPC may (i) with notice to, but without the prior written consent of,
the Borrower and the Agent and without paying any processing fee therefor,
assign all or a portion of its interests in any Loans to the Granting Lender or
to any financial institutions (consented to by the Borrower and Agent)
providing liquidity and/or credit support to or for the account of such SPC to
support the funding or maintenance of Loans and (ii) disclose on a
confidential basis any non-public information relating to its Loans to any
rating agency, commercial paper dealer or provider of any surety, guarantee or
credit or liquidity enhancement to such SPC.

Section
9.05.          Survival.  All covenants, agreements, representations and
warranties made by the Loan Parties in the Loan Documents and in the
certificates or other instruments 
delivered in connection with or pursuant to this Agreement or any other
Loan Document shall be considered to have been relied upon by the other parties
hereto and shall survive the execution and delivery of the Loan Documents and
the making of any Loans, regardless of any investigation made by any such other
party or on its behalf and notwithstanding that the Agent or any Lender may
have had notice or knowledge of any Default or incorrect representation or
warranty at the time any credit is extended hereunder, and shall continue in
full force and effect as long as the principal of or any accrued interest on
any Loan or any fee or any other amount payable under this Agreement is
outstanding and unpaid and so long as the Commitments have not expired or
terminated. The provisions of Sections 2.13, 2.14, 2.15 and 9.03 and Article VIII
shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Commitments or the termination of
this Agreement or any provision hereof.

Section
9.06.          Counterparts;
Integration; Effectiveness.  This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. This Agreement,
the other Loan Documents and the Fee Letter and any separate letter agreements
with respect to fees payable to the Agent constitute 

 

 105
 

 

the entire contract among the
parties relating to the subject matter hereof and supersede any and all
previous agreements and understandings, oral or written, relating to the
subject matter hereof. Except as provided in Section 4.02, this Agreement
shall become effective when it shall have been executed by the Agent and when
the Agent shall have received counterparts hereof which, when taken together,
bear the signatures of each of the other parties hereto, and thereafter shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns. Delivery of an executed counterpart of a
signature page of this Agreement by facsimile shall be effective as
delivery of a manually executed counterpart of this Agreement.

Section
9.07.          Severability.  To the extent permitted by law, any provision
of any Loan Document held to be invalid, illegal or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such invalidity, illegality or unenforceability without affecting the validity,
legality and enforceability of the remaining provisions thereof; and the invalidity
of a particular provision in a particular jurisdiction shall not invalidate
such provision in any other jurisdiction.

Section
9.08.          Right of Setoff.  If an Event of Default shall have occurred and
be continuing, each Lender and each of its Affiliates is hereby authorized at
any time and from time to time, to the fullest extent permitted by law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other obligations at any time owing
by such Lender or Affiliate to or for the credit or the account of the Borrower
or any Loan Guarantor against any of and all the Secured Obligations held by
such Lender, irrespective of whether or not such Lender shall have made any
demand under the Loan Documents and although such obligations may be unmatured.
The applicable Lender shall notify the Borrower and the Agent of such set-off
or application, provided that any failure to give
or any delay in giving such notice shall not affect the validity of any such
set-off or application under this Section. The rights of each Lender under this
Section are in addition to other rights and remedies (including other
rights of setoff) which such Lender may have. NOTWITHSTANDING THE FOREGOING, AT
ANY TIME THAT ANY OF THE SECURED OBLIGATIONS SHALL BE SECURED BY REAL PROPERTY
LOCATED IN CALIFORNIA, NO LENDER SHALL EXERCISE A RIGHT OF SETOFF, LENDER’S
LIEN OR COUNTERCLAIM OR TAKE ANY COURT OR ADMINISTRATIVE ACTION OR INSTITUTE
ANY PROCEEDING TO ENFORCE ANY PROVISION OF THIS AGREEMENT OR ANY LOAN DOCUMENT
UNLESS IT IS TAKEN WITH THE CONSENT OF THE LENDERS REQUIRED BY SECTION 9.02
OF THIS AGREEMENT, IF SUCH SETOFF OR ACTION OR PROCEEDING WOULD OR MIGHT
(PURSUANT TO SECTIONS 580a, 580b, 580d AND 726 OF THE CALIFORNIA CODE OF
CIVIL PROCEDURE OR SECTION 2924 OF THE CALIFORNIA CIVIL CODE, IF
APPLICABLE, OR OTHERWISE) AFFECT OR IMPAIR THE VALIDITY, PRIORITY, OR
ENFORCEABILITY OF THE LIENS GRANTED TO THE AGENT PURSUANT TO THE COLLATERAL
DOCUMENTS OR THE ENFORCEABILITY OF THE OBLIGATIONS HEREUNDER, AND ANY ATTEMPTED
EXERCISE BY ANY LENDER OR ANY SUCH RIGHT WITHOUT OBTAINING SUCH CONSENT OF THE
PARTIES AS REQUIRED ABOVE, SHALL BE NULL AND VOID. THIS PARAGRAPH SHALL BE
SOLELY FOR THE BENEFIT OF EACH OF THE LENDERS.

Section
9.09.          Governing Law;
Jurisdiction; Consent to Service of Process. (a)   THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
(OTHER THAN AS EXPRESSLY SET FORTH IN ANY OTHER LOAN DOCUMENT) SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

(b)  Each Loan Party hereby
irrevocably and unconditionally submits, for itself and its property, to the
nonexclusive jurisdiction of any U.S. Federal or New York State court sitting
in the Borough of Manhattan, New York, New York in any action or proceeding
arising out of or relating to any Loan Documents, or for recognition or
enforcement of any judgment, and each of the parties hereto 

 

 106
 

 

hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may be heard and
determined in such New York State or, to the extent permitted by law, in such
Federal court. Each of the parties hereto agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law. Nothing
in this Agreement or any other Loan Document shall affect any right that the
Agent or any Lender may otherwise have to bring any action or proceeding
relating to this Agreement or any other Loan Document against any Loan Party or
its properties in the courts of any jurisdiction.

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

(d)  To the extent
permitted by law, each party to this Agreement hereby irrevocably waives
personal service of any and all process upon it and agrees that all such
service of process may be made by registered mail (return receipt requested)
directed to it at its address for notices as provided for in Section 9.01.
Nothing in this Agreement or any other Loan Document will affect the right of
any party to this Agreement to serve process in any other manner permitted by
law.

Section 9.10.          WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF
ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY
WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.

Section 9.11.          Headings.  Article and Section headings and the
Table of Contents used herein are for convenience of reference only, are not
part of this Agreement and shall not affect the construction of, or be taken
into consideration in interpreting, this Agreement.

Section 9.12.          Confidentiality.  The Agent, the Issuing Bank and each Lender
agrees (and each Lender agrees to cause its SPC, if any) to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its and its Affiliates’ directors, trustees,
officers, employees and agents, including accountants, legal counsel and other
advisors (it being understood that the Persons to whom such disclosure is made
will be informed of the confidential nature of such Information and instructed
to keep such Information confidential), (b) to the extent requested by any
regulatory, governmental or administrative authority, (c) to the extent
required by law or by any subpoena or similar legal process, (d) to any
other party to this Agreement, (e) in connection with the exercise of any
remedies hereunder or any suit, action or proceeding relating to this Agreement
or any other Loan Document or the enforcement of rights hereunder or
thereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement, including, without limitation, any
SPC, (ii) any pledgee referred to in Section 9.04(d) or (iii) any
actual or prospective counterparty (or its advisors) to any swap or derivative
transaction relating to the Loan Parties and their 

 

 107
 

 

obligations, (g) with the
consent of the Borrower or (h) to the extent such Information (i) becomes
publicly available other than as a result of a breach of this Section or (ii) becomes
available to the Agent, the Issuing Bank or any Lender on a nonconfidential
basis from a source other than the Borrower. For the purposes of this Section, “Information”
means all information received from any Loan Party relating to the Loan Parties
or their businesses, the Sponsor or the Transactions other than any such
information that is available to the Agent, the Issuing Bank or any Lender on a
nonconfidential basis prior to disclosure by any Loan Party. Any Person
required to maintain the confidentiality of Information as provided in this Section shall
be considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.

Section 9.13.          Several Obligations; Nonreliance;
Violation of Law.  The respective
obligations of the Lenders hereunder are several and not joint and the failure
of any Lender to make any Loan or perform any of its obligations hereunder
shall not relieve any other Lender from any of its obligations hereunder. Each
Lender hereby represents that (a) it is not relying on or looking to any
Margin Stock for the repayment of the Borrowings provided for herein and
acknowledges that the Collateral shall not include any Margin Stock and (b) it
is not and will not become a “creditor” as defined in Regulation T or a “foreign
branch of a broker-dealer” within the meaning of Regulation X. Anything
contained in this Agreement to the contrary notwithstanding, no Lender shall be
obligated to extend credit to the Borrower in violation of any Requirement of
Law.

Section 9.14.          USA PATRIOT Act.  Each Lender that is subject to the
requirements of the USA Patriot Act hereby notifies the Borrower that pursuant
to the requirements of the USA Patriot Act, it is required to obtain, verify
and record information that identifies the Borrower, which information includes
the name and address of the Borrower and other information that will allow such
Lender to identify the Borrower in accordance with the USA Patriot Act.

Section 9.15.          Disclosure.  Each Loan Party and each Lender hereby
acknowledges and agrees that the Agent and/or its Affiliates from time to time
may hold investments in, make other loans to or have other relationships with
any of the Loan Parties and their respective Affiliates. In addition, each Loan
Party and each Lender hereby acknowledges that an Affiliate of the Agent will
be an initial purchaser of the Senior Subordinated Notes.

Section 9.16.          Appointment for Perfection.  Each Lender hereby appoints each other Lender
as its agent for the purpose of perfecting Liens, for the benefit of the Agent
and the Lenders, in assets which, in accordance with Article 9 of the UCC
or any other applicable law can be perfected only by possession. Should any
Lender (other than the Agent) obtain possession of any such Collateral, such
Lender shall notify the Agent thereof, and, promptly upon the Agent’s request
therefor shall deliver such Collateral to the Agent or otherwise deal with such
Collateral in accordance with the Agent’s instructions.

Section 9.17.          Interest Rate Limitation.  Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan or
participation in any L/C Disbursement, together with all fees, charges and
other amounts which are treated as interest on such Loan or participation in
such L/C Disbursement under applicable law (collectively the “Charges”),
shall exceed the maximum lawful rate (the “Maximum Rate”) which may be
contracted for, charged, taken, received or reserved by the Lender holding such
Loan or participation in accordance with applicable law, the rate of interest
payable in respect of such Loan or participation hereunder, together with all
Charges payable in respect thereof, shall be limited to the Maximum Rate and,
to the extent lawful, the interest and Charges that would have been payable in
respect of such Loan or participation but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or participations or periods
shall be increased (but not above the Maximum Rate therefor) until such 

 

 108
 

 

cumulated amount, together with
interest thereon at the Federal Funds Effective Rate to the date of repayment,
shall have been received by such Lender.

 

 109
 

 

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

	
   

  	
  TRANSDIGM INC.

  
	
   

  	
  TRANSDIGM GROUP INCORPORATED

  
	
   

  	
  ADAMS RITE AEROSPACE, INC.

  
	
   

  	
  AVIONIC INSTRUMENTS INC.

  
	
   

  	
  CHAMPION AEROSPACE INC.

  
	
   

  	
  CHRISTIE ELECTRIC CORP.

  
	
   

  	
  DAC REALTY CORP.

  
	
   

  	
  MARATHONNORCO
  AEROSPACE, INC.

  
	
   

  	
  SKURKA AEROSPACE INC.

  
	
   

  	
  ZMP, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By  

  	
   

  
	
   

  	
   

  	
  /s/ W. NICHOLAS HOWLEY

  
	
   

  	
   

  	
  Name: W. Nicholas Howley

  
	
   

  	
   

  	
  Title: Chief Executive
  Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SWEENEY ENGINEERING CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
  By  

  	
   

  
	
   

  	
   

  	
  /s/ GREGORY RUFUS

  
	
   

  	
   

  	
  Name: Gregory Rufus

  
	
   

  	
   

  	
  Title: Secretary

  

 

 110

 

	
  

  	
  CREDIT SUISSE,
  CAYMAN ISLANDS BRANCH,

  individually and as Agent, Swingline Lender and Issuing

  Bank

  
	
   

  	
   

  
	
   

  	
  By 

  	
  /s/Cassandra Droogan

  
	
   

  	
   

  
	
   

  	
   

  	
  Name: Cassandra Droogan

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/Shaheen Malik

  
	
   

  	
   

  	
  Name: Shaheen Malik

  
	
   

  	
   

  	
  Title: Associate

  
	
   

  
	
   

  
	
   

  
	
  

  	
  BANK OF AMERICA, N.A.,

  
	
   

  	
   

  
	
   

  	
  By    /s/ David H. Strickert

  
	
   

  	
   

  	
  Name: David H. Strickert

  
	
   

  	
   

  	
  Title: Senior Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  MIZUHO CORPORATE BANK, LTD.

  
	
   

  	
   

  
	
   

  	
  By    /s/ James R. Fayen

  
	
   

  	
   

  	
  Name: James R. Fayen

  
	
   

  	
   

  	
  Title: Deputy General Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BANK OF IRELAND,

  
	
   

  	
   

  
	
   

  	
  By   /s/ Carl Andreson

  
	
   

  	
   

  	
  Name: Carl Andreson

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
  By   /s/ Ross Catlin

  
	
   

  	
   

  	
  Name: Ross Catlin

  
	
   

  	
   

  	
  Title: Managing Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BARCLAYS BANK PLC,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By   /s/ Philip Capparis

  
	
   

  	
   

  	
  Name: Philip Capparis

  
	
   

  	
   

  	
  Title: Director

  

 

 111
 

 

 

	
  

  	
  CREDIT INDUSTRIEL ET
  COMMERCIAL,

  
	
   

  
	
   

  	
  By    /s/
  Brian O’Leary

  
	
   

  	
   

  	
  Name: Brian O’Leary

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  
	
   

  	
  By   /s/ Marcus Edward

  
	
   

  	
   

  	
  Name: Marcus Edward

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  
	
   

  
	
   

  	
  THE CIT GROUP / EQUIPMENT
  FINANCING INC.,

  
	
   

  
	
   

  	
  By   /s/ Andrew Giangrave

  
	
   

  	
   

  	
  Name: Andrew Giangrave

  
	
   

  	
   

  	
  Title: Authorized Signatory

  
	
   

  
	
   

  
	
   

  	
  FIRSTMERIT BANK, N.A.,

  
	
   

  
	
   

  	
  By   /s/ Robert G. Morlan

  
	
   

  	
   

  	
  Name: Robert G. Morlan

  
	
   

  	
   

  	
  Title: Senior
  Vice President

  
	
   

  
	
   

  
	
   

  	
  GENERAL ELECTRIC CAPITAL
  CORPORATION,

  
	
   

  
	
   

  	
  By   /s/ Sean McUmminie

  
	
   

  	
   

  	
  Name: Sean
  McUmminie

  
	
   

  	
   

  	
  Title: Duly Authorized Signatory

  
	
   

  
	
   

  
	
   

  	
  NATIONAL CITY BANK,

  
	
   

  
	
   

  	
  By   /s/ Daniel R. Raynor

  
	
   

  	
   

  	
  Name: Daniel R. Raynor

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  
	
   

  
	
   

  	
  PNC BANK, NATIONAL ASSOCIATION,

  
	
   

  
	
   

  	
  By   /s/ Joseph G. Moran

  
	
   

  	
   

  	
  Name: Joseph G. Moran

  
	
   

  	
   

  	
  Title: Managing Director

  
	
   

  
	
   

  
	
   

  	
  UBS LOAN FINANCE LLC,

  
	
   

  
	
   

  	
  By   /s/ Richard L. Tavrow

  
	
   

  	
   

  	
  Name: Richard L. Tavrow

  
	
   

  	
   

  	
  Title: Director

  

 

 112
 

 

 

 

	
  

  	
  By   /s/
  Irja R. Otsa

  
	
   

  	
   

  	
  Name: Irja R. Otsa

  
	
   

  	
   

  	
  Title: Associate Director

  

 

 113
 

 

COMMITMENT
SCHEDULE

	
  Lender

  	
   

  	
   

  	
   

  	
  Revolving Credit

  Commitment

  	
   

  	
  Term Loan Commitment

  	
   

  
	
  Credit Suisse

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  $

  	
  325,000,000

  	
   

  
	
  Bank of America,
  N.A.

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  $

  	
  325,000,000

  	
   

  
	
  General Electric
  Capital Corporation

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
   

  	
   

  
	
  Barclays Bank
  PLC

  	
   

  	
  $

  	
  15,000,000

  	
   

  	
   

  	
   

  
	
  UBS Loan Finance
  LLC

  	
   

  	
  $

  	
  15,000,000

  	
   

  	
   

  	
   

  
	
  Mizuho Bank

  	
   

  	
  $

  	
  15,000,000

  	
   

  	
   

  	
   

  
	
  Credit
  Industriel et Commercial

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
   

  	
   

  
	
  The CIT Group /
  Equipment Financing Inc.

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
   

  	
   

  
	
  National City
  Bank

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
   

  	
   

  
	
  Bank of Ireland

  	
   

  	
  $

  	
  7,500,000

  	
   

  	
   

  	
   

  
	
  FirstMerit Bank,
  N.A.

  	
   

  	
  $

  	
  4,000,000

  	
   

  	
   

  	
   

  
	
  PNC Bank,
  National Association

  	
   

  	
  $

  	
  3,500,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  $

  	
  150,000,000

  	
   

  	
  $

  	
  650,000,000

  	
   

  

 

 114

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00106-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00106-of-00352.parquet"}]]