Document:

EX-10.14 SUPPLEMENTAL AGREEMENT DATED 10-31-2005

 

	 	 	 	 	 

Exhibit 10.14

SUPPLEMENTAL AGREEMENT

     This SUPPLEMENTAL AGREEMENT, dated as of October 31, 2005, is made by and among TCO Funding
Corp., a Delaware corporation, (“TCO”), The Tensar Corporation, LLC, a Georgia limited liability
company (“Tensar”) and Credit Suisse, as administrative agent on behalf of TCO (“Administrative
Agent”).

PRELIMINARY STATEMENT

     On the Effective Date, TCO purchased the Leased Assets from Tensar pursuant to the Asset
Purchase Agreement. Immediately after such purchase, TCO leased the Leased Assets to Tensar
pursuant to that certain Lease Financing and Purchase Option Agreement, dated as of the Effective
Date (as the same may be amended, modified or supplemented from time to time, the “Agreement”),
among TCO, Administrative Agent and Tensar. Unless otherwise specified, capitalized terms used
herein have the definitions specified in the Agreement. Under the Agreement, TCO has agreed to
perform certain tasks and to undertake certain responsibilities in relation to the Leased Assets.
TCO would like to retain Tensar to perform those tasks and responsibilities in relation to the
Leased Assets on the terms and conditions herein set forth and for the compensation herein
provided, and Tensar is interested in undertaking those tasks and responsibilities in relation to
the Leased Assets for such compensation.

     NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is agreed as follows:

     SECTION 1. Agreement. TCO and Tensar hereby agree that Tensar shall undertake the matters
described in Sections 2, 3, 4, and 6 below (the “Obligations”) and Tensar hereby agrees to perform
the Obligations, all on the terms and conditions of this Supplemental Agreement.

     SECTION 2. Major Maintenance. Tensar agrees that, during the Term, Tensar shall at all times
(i) determine whether any Leased Asset requires any Major Maintenance and (ii) perform and provide
all such Major Maintenance. Tensar shall keep accurate, complete and current records of all Major
Maintenance performed or provided on any Leased Assets and shall provide copies thereof to TCO
promptly on demand.

     SECTION 3. Required Alterations. Tensar agrees that during the Term, Tensar shall at all
times make all Required Alterations with respect to the Leased Assets. Tensar shall keep accurate,
complete and current records of all Required Alterations made with respect to the Leased Assets
and shall provide copies thereof to TCO promptly on demand.

     SECTION 4. Insurance.

     (a) Tensar agrees that during the Term, Tensar shall at all times obtain and maintain in
effect insurance for the Leased Assets in compliance with Section 15 (a) of the Agreement and
Section 5.3 of the Guarantee and Collateral Agreement and Section 1.02 of Schedule 3 of the Lease
Agreement with insurers meeting the requirements of such Sections; provided, that the
amount of such insurance to be maintained by Tensar must be in an amount equal to at least

 

 

100% of the unpaid Acquisition Cost of the Leased Assets. The failure of Tensar to obtain and
maintain insurance as required in the preceding sentence with solvent insurers who shall have
acknowledged liability in an amount equal to at least 100% of the unpaid Acquisition Cost shall
constitute “negligence” for purposes of Section 6(a) of this Supplemental Agreement.

     (b) Tensar agrees that during the Term, Tensar shall comply with the insurance requirements
set forth in this Section 4. Tensar shall deliver to TCO by the date hereof certificates of
insurance evidencing the insurance required to be maintained under this Supplemental Agreement.
Tensar will deliver to TCO such certificates of insurance and other evidence of insurance with
respect to the items described herein as may be requested by TCO from time to time.

     SECTION 5. Payments by TCO.

     (a) TCO agrees to pay to Tensar a fee of U.S. $10 on the date hereof for the performance by
Tensar of the Obligations.

     (b) The parties agree that TCO shall pay to Tensar on each Rent Payment Date the amount of
U.S. $10,000, which amount is the estimated cost of Tensar performing the Obligations during such
Rent Period. If either party hereto believes that such amount does not reflect the actual cost
incurred by Tensar, the parties shall discuss the matter and, if agreement is reached, agree in
writing, with the consent of Administrative Agent, to an adjustment to reflect the actual cost of
performing the Obligations, such adjustment to take effect at the beginning of the next Rent Period
in accordance with the Agreement.

     (c) Tensar shall not be entitled to any payment or compensation, other than the fee specified
in paragraph (a) of this Section and the amount specified in paragraph (b) of this Section, for
performing the Obligations hereunder.

     (d) This Supplemental Agreement may not be terminated by Tensar without the prior written
consent of TCO and the Administrative Agent.

     SECTION 6. Payments by Tensar.

     (a) Upon the occurrence of an Event of Loss, Tensar shall arrange for all applicable insurance
proceeds to be paid to TCO. If and to the extent that, as a consequence of any Event of Loss, the
proceeds of any insurance in respect thereof are insufficient or nonexistent, due to the negligence
on the part of Tensar, to keep TCO indemnified for any Loss (as defined below), Tensar shall assume
liability for any such Loss suffered by TCO as a consequence thereof. For the purpose of this
Section 6, (i) “negligence” includes any breach of duty, exceeding of authority, failure, mistake,
error, misfeasance or default or any Loss to TCO caused (in whole or in part) by inaccurate or
inadequate insurance arrangements or recoveries, whether by act or omission (including by payment
of contractual deductibles) and (ii) a “Loss” occurs to the extent that TCO has not received within
one Business Day after the occurrence of an Event of Loss an amount equal to the unpaid Acquisition
Cost of the Leased Assets. Tensar hereby agrees to pay to TCO within three Business Days of such
Loss the unpaid Acquisition Cost of the Leased Assets.

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     (b) Tensar hereby undertakes that it shall pay to TCO, upon demand, to the extent permitted by
applicable law, a late fee on any amount payable under this Supplemental Agreement that is not paid
when due, for any period for which the same is overdue, at a rate equal to Default Rate from and
including the due date for payments to be made pursuant to Section 6(a) to the date on which the
amount specified in Section 6(a) is paid in full. Payment or
acceptance of such fee provided for in this Section 6(b) is not a permitted alternative to
timely payment and shall not constitute a waiver of any default or event of default or otherwise
prejudice or limit any rights or remedies of TCO.

     (c) Tensar acknowledges and agrees that, except as otherwise specifically provided in the
Agreement or herein, Tensar’s obligations hereunder shall be absolute and unconditional under any
and all circumstances and shall be paid without notice or demand and without any abatement,
reduction, diminution, setoff, defense, counterclaim or recoupment whatsoever, including, without
limitation, any abatement, reduction, diminution, setoff, defense, counterclaim or recoupment due
or alleged to be due to, or by reason of, any past, present or future claims which Tensar may have
against TCO or any other Person for any reason whatsoever. The obligation of Tensar to pay any
amounts payable under this Supplemental Agreement shall be full recourse obligations of Tensar and
secured by the Security Documents.

     SECTION 7. Benefit of Agreement. This Supplemental Agreement shall be binding upon, and inure
to and for the benefit of TCO, Tensar and the Administrative Agent and their respective successors
and assigns. Tensar agrees that it may not assign its interest in this Supplemental Agreement in
whole or in part without the prior written consent of TCO, and any such assignment without such
consent shall be null and void. Each party agrees that any assignment of the Agreement by either
party thereto must include an assignment and assumption of such party’s interest in this
Supplemental Agreement.

     SECTION 8 Miscellaneous. The provisions concerning Survival; Expenses; Indemnity; Waiver of
Jury Trial; etc. (Section 17), Notices (Section 25), Appointment of Administrative Agent (Section
28) and Miscellaneous (Section 29) of the Agreement are hereby incorporated by reference herein as
if fully set forth herein, and all references therein to the Agreement, “hereunder”, “hereof or
words of similar effect shall be a reference to this Supplemental Agreement

[Signature Page Follows]

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     IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Agreement to be duly
executed as of the date first above written.

	 	 	 	 	 
	 	TCO FUNDING CORP. 

 	 
	 	By  	/s/ KATHERINE SPEAR	 
	 	 	Name:  	KATHERINE SPEAR	 
	 	 	Title:  	CHIEF FINANCIAL OFFICER	 
	 
	 	THE TENSAR CORPORATION, LUC

 	 
	 	By  	/s/ KATHERINE SPEAR	 
	 	 	Name:  	KATHERINE SPEAR	 
	 	 	Title:  	CHIEF FINANCIAL OFFICER	 
	 
	 	CREDIT SUISSE, Cayman Islands Branch

 	 
	 	By  	/s/ PHILLIP HO
 	 
	 	 	Name: PHILLIP HO 	 
	 	 	Title: 	DIRECTOR 	 
	 
	 	 	 
	 	By  	 /s/ RIANKA MOHAN
 	 
	 	 	Name:  	RIANKA MOHAN 	 
	 	 	Title:  	ASSOCIATE 	 
	 

[Signature Page to Supplemental Agreement]EX-10.15 WORKING CAPITAL MURABAHA FACILITY AGRMT

 

Exhibit 10.15

 

WORKING CAPITAL MURABAHA

FACILITY AGREEMENT

dated as of October 31, 2005

among

TCO FUNDING CORP.,

TENSAR HOLDINGS, INC.,

THE TENSAR CORPORATION, LLC,

ARCAPITA INVESTMENT FUNDING LIMITED,

as Agent for TCO Funding Corp.,

AIA LIMITED,

as Agent for The Tensar Corporation, LLC,

and

CREDIT SUISSE,

as Administrative Agent for TCO Funding Corp.

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	ARTICLE I DEFINITIONS
	 	 	1	 
	Section 1.3. Schedules Annexes and Exhibits
	 	 	7	 
	ARTICLE II REVOLVING PURCHASING FACILITY
	 	 	7	 
	Section 2.1. Revolving Purchasing Facility and Appointment of Agents
	 	 	7	 
	Section 2.2. Metals Transactions
	 	 	9	 
	Section 2.3. Goods Transactions
	 	 	10	 
	Section 2.5. Assignment of Warranties
	 	 	13	 
	ARTICLE III OTHER PROVISIONS RELATING TO THE FACILITY
	 	 	14	 
	Section 3.1. Payments
	 	 	14	 
	Section 3.2. Termination of the Facility
	 	 	14	 
	Section 3.4. Adjustments to the Applicable Margin
	 	 	15	 
	Section 3.5. Unavailability of Funding
	 	 	16	 
	Section 3.6. Evidence of Obligations
	 	 	16	 
	Section 3.7. Prepayments; Termination of Facility
	 	 	16	 
	Section 3.8. Fees
	 	 	18	 
	Section 3.9. Crediting Payments
	 	 	18	 
	ARTICLE IV CONDITIONS PRECEDENT
	 	 	19	 
	Section 4.1. Initial Transaction
	 	 	19	 
	Section 4.2. Each Transaction
	 	 	19	 
	ARTICLE V REPRESENTATIONS, WARRANTIES AND COVENANTS
	 	 	19	 
	Section 5.1. Representations and Warranties
	 	 	19	 
	Section 5.2. Affirmative Covenants
	 	 	20	 
	Section 5.3. Negative Covenants
	 	 	20	 
	ARTICLE VI EVENTS OF DEFAULT
	 	 	20	 
	ARTICLE VII REMEDIES UPON DEFAULT
	 	 	20	 
	ARTICLE VIII MISCELLANEOUS
	 	 	20	 
	Section 8.1. Notices
	 	 	20	 
	Section 8.2. Right of Set-Off; Adjustments
	 	 	22	 
	Section 8.3. Benefit of Agreement; Assignments
	 	 	23	 
	Section 8.4. No Waiver; Remedies Cumulative
	 	 	23	 
	Section 8.5. Expenses; Indemnification; other Miscellaneous Provisions
	 	 	23	 
	Section 8.6. Amendments, Waivers and Consents
	 	 	24	 
	Section 8.7. Headings
	 	 	24	 
	Section 8.8. Severability
	 	 	24	 
	Section 8.9. Entirety
	 	 	24	 
	Section 8.10. Tax Consequences
	 	 	24	 
	Section 8.11. Governing Law
	 	 	25	 
	Section 8.14. Counterparts
	 	 	26	 
	Section 8.15. Conflicts
	 	 	26	 

Schedules

 

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	Schedule 1 -	 	Definitions
	 

	 	Annex 1 (a)
	 	Permitted Holders
	 

	 	Annex l(b)
	 	Subsidiary Guarantors
	 

	 	Annex l(c)
	 	EBITD A Adjustments
	 

	 	Annex l(d)
	 	Mortgaged Properties
	 
	 	 	 	 
	Schedule 2 -	 	Representations and Warranties
	 

	 	Annex 5
	 	Projections
	 

	 	Annex 8
	 	Subsidiaries
	 

	 	Annex 9
	 	Litigation
	 

	 	Annex 14
	 	Taxes
	 

	 	Annex 17
	 	Environmental
	 

	 	Annex 18
	 	Insurance
	 

	 	Annex 19(a)
	 	UCC Filing Offices
	 

	 	Annex 19(b)
	 	Intellectual Property Filing Offices
	 

	 	Annex 19(c)
	 	Real Property Filings
	 

	 	Annex 20
	 	Real Property
	 

	 	Annex 25
	 	Acquisition Documentation
	 

	 	Annex 28
	 	Holdings’ Contracts
	 

	 	Annex 29
	 	Tensar Holdings’ Contracts
	 

	 	Annex 30
	 	Customer Relations
	 

	 	Annex 31
	 	Brokers and Finders Fees
	 
	 	 	 	 
	Schedule 3 -	 	Affirmative Covenants
	 

	 	Annex 9
	 	Requirements for Mortgages
	 
	 	 	 	 
	Schedule 4 -	 	Negative Covenants
	 

	 	Annex 1
	 	Permitted Financing Obligations
	 

	 	Annex 2
	 	Permitted Liens
	 

	 	Annex 4
	 	Existing Investments
	 

	 	Annex 7
	 	Affiliate Transactions
	 

	 	Annex 8
	 	Capital Structure
	 

	 	Annex 17
	 	Existing Operating Leases
	 
	 	 	 	 
	Schedule 5 -	 	Events of Default
	 
	 	 	 	 
	Schedule 6 -	 	Miscellaneous Provisions

Exhibits

	 	 	 
	Exhibit A

	 	Form of Metals Purchase Request
	 
	Exhibit B

	 	Form of Metals Purchase Confirmation
	 
	Exhibit C

	 	Form of Metals Purchase Offer
	 
	Exhibit D

	 	Form of Metals Purchase Acceptance

 

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	Exhibit E

	 	Form of Goods Purchase Request
	 
	Exhibit F

	 	Form of Agency Agreement
	 
	Exhibit G

	 	Form of Goods Purchase Offer
	 
	Exhibit H

	 	Form of Goods Purchase Acceptance
	 
	Exhibit I-1

	 	Form of Fee Mortgage
	 
	Exhibit I-2

	 	Form of Leasehold Mortgage
	 
	Exhibit J

	 	Form of Tensar Intercreditor Agreement
	 
	Exhibit K

	 	Form of Affiliate Subordination Agreement
	 
	Exhibit L

	 	Form of Tensar Holdings Subordination Agreement
	 
	Exhibit M

	 	Form of Reimbursement Letter
	 
	Exhibit N

	 	Form of Perfection Certificate
	 
	Exhibit O

	 	Form of Guarantee and Collateral Agreement

 

 

WORKING CAPITAL

MURABAHA FACILITY AGREEMENT

     THIS WORKING CAPITAL MURABAHA FACILITY AGREEMENT, dated as of October 31, 2005 (as amended,
modified, restated or supplemented from time to time, this “Agreement”), is among TCO FUNDING
CORP., a Delaware corporation (“TCO”), THE TENSAR CORPORATION, LLC, a Georgia limited liability
company (the “Tensar”), ARCAPITA INVESTMENT FUNDING LIMITED, a Cayman Islands limited liability
company “AIFL”), AIA LIMITED,
a Cayman Islands limited liability company (“AIA”) and Credit Suisse
(“Credit Suisse”), as
administrative agent for TCO (in such capacity, the
“Administrative Agent”).

PRELIMINARY STATEMENTS

     WHEREAS, Tensar is seeking financing and other financial accommodations in the amount of up
to $30,000,000 through a deferred payment revolving purchasing facility (the “Financing”);

     WHEREAS, the Financing is being provided to Tensar by and through TCO on the terms and
subject to the conditions hereinafter set forth;

     WHEREAS, AIFL has agreed to act as the agent of TCO to facilitate the transactions
contemplated hereunder;

     WHEREAS, AIA has agreed to act as the agent of Tensar to facilitate the transactions
contemplated hereunder; and

     WHEREAS, Credit Suisse has agreed to act as the Administrative Agent for TCO in connection
with the transactions contemplated hereunder.

     NOW, THEREFORE, in consideration of the premises and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be
legally bound, hereby agree as follows:

ARTICLE I
 DEFINITIONS

     Section 1.1. Definitions.

     (a) Capitalized terms used in this Agreement (including the Schedules, Annexes and
Exhibits hereto) shall have the meanings assigned to them on Schedule 1 hereto and,
to the extent not defined on Schedule 1, shall have the meanings set forth below

     “Adjusted Eurodollar Rate” means, for any Transaction for any Deferred Payment Period, a rate
per annum equal to the product of (a) the Eurodollar Rate in effect for such Deferred Payment
Period and (b) Eurodollar Reserves.

     “Administrative Agent” means Credit Suisse.

 

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     “Agency Agreement” means an agreement among TCO and Tensar substantially in the form of the
Exhibit F, pursuant to which TCO accepts Tensar’s proposal to enter into a Transaction and
appoints Tensar as its agent to purchase the Goods subject to such Transaction.

     “Aggregate Goods Undertakings” means, on any date, the aggregate Murabaha Price for all Goods
Transactions that are pending and for all Goods Transactions that have been completed but have not
been paid by Tensar as of such date.

     “Aggregate Murabaha Price” means at any time the total of all unpaid Murabaha Price amounts
outstanding at such time.

     “Aggregate Purchase Price” means at any time the aggregate of the unpaid Purchase Price
amounts included in the Aggregate Murabaha Price outstanding at such time. Solely for the purpose
of making such computation in connection with any partial payment of a Murabaha Price, any partial
payment of a Murabaha Price shall be allocated against the Purchase Price and the Agreed Profit
components of that portion of the Murabaha Price being partially prepaid such that the amount
allocated to the Agreed Profit component equals the Agreed Profit accrued to the date of such
partial payment on the amount allocated to the Purchase Price component of such Murabaha Price.

     “Agreed Profit” means, (i) for any Metals Transaction, an amount determined by TCO by taking
the product of the Profit Rate multiplied by the Metals Transaction Purchase Price of the Metals
covered by such Metals Transaction multiplied by the actual number of days from the Value Date for
such Metals Transaction to the Payment Date for such Metals Transaction and dividing such product
by 360; and (ii) for any Goods Transaction, an amount determined by TCO equal to the Stated Rate
times the Goods Purchase Price times the number of days from the Value Date to the last date for
the completion of the purchase of the Goods, as specified by Tensar in the related Goods Purchase
Request.

     “Agreement” means this Working Capital Murabaha Facility Agreement, together with the
Schedules, Annexes and Exhibits hereto, as the same may be amended, supplemented or modified from
time to time.

     “AIA” shall have the meaning specified in the preamble hereto.

     “AIFL” shall have the meaning specified in the preamble hereto.

     “Alternate Rate” means, as of any date of determination, a rate per annum equal to the
greater of (a) the Base Rate in effect on such day and (b) the Federal Funds Rate in effect on
such day plus 1/2 of 1%.

     “Applicable Margin” shall mean, as of a date of determination, a percentage per annum equal
to 2.75%.

     “Base Rate” shall mean, at any time, the rate per annum publicly announced from time to time
by Credit Suisse as its “prime rate” in effect at its principal office in New York City, each
change in the Base Rate shall be effective as of the opening of business on the date such change
is publicly announced as being effective.

 

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     “Company” means The Tensar Corporation, LLC, a Georgia limited liability company.

     “Default Rate” shall mean, (i) the Alternate Rate, plus (ii) two percent (2%).

     “Deferred Payment Period” shall mean, for each Metals Transaction, a period, as Tensar may
select, of one, two, three or six months’ duration, or if agreed to by TCO, two weeks’ or 9 or 12
months’ duration, in each case commencing on the Value Date for such Transaction and ending on the
Payment Date for such Transaction.

     “Designated Seller” has the meaning assigned to that term in Section 2.3(a).

     “ECF Percentage” means 75% or, if on the date of applicable repayment pursuant to Section
3.7(f), the Leverage Ratio is less than 3.00 to 1.00, 50%.

     “Effective Date” means the date of this Agreement.

     “Eurodollar Rate” shall mean, for any Transaction for any Deferred Payment Period, the rate
per annum determined by the Administrative Agent at approximately 11:00 a.m., London time, on the
date that is two Business Days prior to the commencement of such Deferred Payment Period by
reference to the British Bankers’ Association Interest Settlement Rates for deposits in dollars
(as set forth by the Bloomberg Information Service or any successor thereto or any other service
selected by the Administrative Agent which 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 Deferred Payment Period; provided that, to the extent that a rate is not
ascertainable pursuant to the foregoing provisions of this definition, the “Eurodollar Rate” shall
be the rate per annum determined by the Administrative Agent to be the average of the rates per
annum at which deposits in dollars are offered for such relevant Deferred Payment Period to major
banks in the London interbank market in London, England by the Administrative Agent at
approximately 11:00 a.m. (London time) on the date that is two Business Days prior to the
beginning of such Deferred Payment Period.

     “Eurodollar
Reserves” means a fraction (expressed as a decimal), the numerator of which is
the number one and the denominator of which is the number one minus the aggregate of the maximum
reserve percentages (including any marginal, special, emergency or supplemental reserves)
expressed as a decimal established by the Board of Governors of the Federal Reserve System and any
other banking authority, domestic or foreign, applicable to Eurocurrency Liabilities (as that term
is defined in Regulation D). Any change in the Eurodollar Reserves shall take effect on and as of
the effective date of any change in any reserve percentage, but shall be payable only with the
first Transaction for any Deferred Payment Period beginning after the date of such change.

     “Event of Default” has the meaning set forth in Schedule
5. 

     “Facility” shall have the meaning specified in Section 2.1(a).

     “Federal Funds Rate” shall mean, for any day, the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged by Federal funds
brokers, as published on the next succeeding Business Day by the Federal Reserve

 

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Bank of New York, or, if such rate is not so published for any day that is a Business Day, the
average of the quotations for the day for such transactions received by the Administrative Agent
from three Federal funds brokers of recognized standing selected by it.

     “Financing” shall have the meaning specified in the first preliminary statement.

     “Goods” means such goods designated by Tensar as may be purchased by TCO for sale to, and
acceptance by, TCO from time to time in accordance with this Agreement.

     “Goods Purchase Acceptance” has the meaning specified in Section 2.3(d).

     “Goods Purchase Offer” has the meaning specified in Section 2.3(d).

     “Goods Purchase Price” has the meaning specified in Section 2.3(a).

     “Goods Purchase Request” has the meaning specified in Section 2.3(a).

     “Goods Transaction” has the meaning specified in Section 2.1(a).

     “Goods Transaction Confirmation” has the meaning specified in Section 2.3(b).

     “Goods Transaction Payment Date” has the meaning specified in Section 2.3(d).

     “Guarantee Obligation” shall have the meaning set forth in the Reimbursement Letter.

     “Interim Agreed Profit” means, for any Metals Transaction with a Deferred Payment Period of 6
months, 9 months or 12 months from the Value Date, an amount determined by the Administrative
Agent by taking the product of the Profit Rate multiplied by the Purchase Price of the Metals
covered by such Transaction multiplied by the actual number of days from the Value Date for such
Transaction or the last occurring Interim Metals Transaction Payment Date for such Transaction, as
the case may be, to the next occurring Interim Metals Transaction Payment Date for such
Transaction and dividing such product by 360.

     “Interim Metals Transaction Payment Date” means, with respect to a Metals Transaction with a
Deferred Payment Period of 6 months, 9 month or 12 months from the Value Date, as the case may be,
the date that is three (3) months from the first day of such Deferred Payment Period and each date
thereafter that is three months (3) from the last occurring Interim Metals Transaction Payment
Date, if any, up to but not including the Metals Transaction Payment Date for such Metals
Transaction.

     “Letters of Undertaking” means, collectively, (i) that certain Letter of Understanding
Regarding Commodities Purchases and Sales dated April 20, 2000 by and between Richmond Commodities
Limited, a Cayman Islands limited liability company and First Islamic Investment Funding Limited
(now known as Arcapita Investment Funding Limited) and (ii) that certain Letter of Understanding
Regarding Commodities Purchases and Sales dated February 14, 2002 by and between FILA Limited (now
known as AIA Limited) and Dawnay, Day & Co., Limited, a company incorporated under the laws of
England and Wales.

 

5

     “Maximum Facility Amount” means $30,000,000, as such amount may be reduced from time to time
in accordance with the terms hereof.

     “Metals”
shall mean such metals as may be purchased by TCO for sale to,
and acceptance by, Tensar from time to time in accordance with this Agreement.

     “Metals Purchase Acceptance” has the meaning specified in Section 2.2(e).

     “Metals Purchase Confirmation” has the meaning specified in Section 2.2(b).

     “Metals Purchase Offer” has the meaning specified in Section 2.2(d).

     “Metals Purchase Request” has the meaning specified in Section 2.2(a).

     “Metals Transaction” has the meaning specified in Section 2.1 (a).

     “Metals Transaction Confirmation” has the meaning specified in Section 2.2(b).

     “Metals Transaction Payment Date” has the meaning specified in Section 2.2(a).

     “Murabaha Price” means, with respect to a Metals Transaction or Goods Transaction, as
applicable, (i) the Purchase Price of such Metals or Goods, plus (ii) the Agreed Profit
for such Transaction, plus (iii) if applicable, the Supplemental Profit for such
Transaction, all as computed by TCO in accordance with this Agreement. Notwithstanding the
foregoing, the Murabaha Price for any Transaction with a Deferred Payment Period of 6 months, 9
months or 12 months from the Value Date shall, on each Interim Payment Date applicable to such
Transaction, be reduced by the Interim Agreed Profit paid by Tensar with respect to such
Transaction on such Interim Payment Date.

     “Overage” has the meaning specified in Section 3.7.

     “Payment Account” shall have the meaning assigned to that term in Section 3.1(a).

     “Payment Date” means a Metals Transaction Payment Date or a Goods Transaction Payment Date,
as applicable.

     “Profit Rate” means, for any Metals Transaction, the Adjusted Eurodollar Rate plus the
Applicable Margin; provided that if TCO determines (which determination shall be conclusive) that
by reason of circumstances affecting the relevant market, or restricting the ability of TCO to
obtain satisfactory funding to enable it to satisfy its obligations hereunder, adequate and
reasonable means do not exist for ascertaining the Adjusted Eurodollar Rate for such Transaction,
the Profit Rate shall mean the Stated Rate.

     “Purchase Price” means, (i) for the Metals covered by a Metals Transaction, the total amount
paid by TCO to the Supplier for such Metals which total amount shall equal 100% of the spot market
price for such Metals prevailing on the Transaction Date, as reported to TCO by Supplier,
plus an amount to be agreed to between TCO and the Supplier (which amount shall not exceed
$1,000 per Transaction), plus any value added tax, sales tax, registration or transfer tax
or

 

6

other similar taxes or duties (where applicable) payable by TCO on or in relation to such
Transaction and (ii) for the Goods covered by a Goods Transaction, the Goods Purchase Price
specified for such Transaction.

     “Purchase Request Confirmation” means a Metals Transaction Confirmation or a Goods
Transaction Confirmation, as applicable.

     “Recovery Event” means any settlement of or payment in respect of any property or casualty
insurance claim or any taking under power of eminent domain or by condemnation or similar
proceeding of or relating to any property or asset of any Tensar Party or any Subsidiary.

     “Reimbursement Letter” means that certain letter, in the form attached hereto as Exhibit M
dated the date hereof from Tensar to TCO and the Administrative Agent.

     “Reimbursement Letter Obligations Exposure” means, at any time, the sum of the then
outstanding Guarantee Obligations and any Unpaid Reimbursement Obligations of Tensar under the
Reimbursement Letter at such time.

     “Reimbursement Obligation” means Tensar’s obligation to reimburse TCO on account of any
drawing under any Guarantee Obligation pursuant to the Reimbursement Letter.

     “Stated
Rate” means, as of any date of determination, a rate per annum equal to the Alternate
Rate on such date of determination plus 1.75%.

     “Sub-Agent” shall have the meaning specified in Section 2.1(c).

     “Supplemental Profit” means, for any Transaction, an amount specified by TCO in a Purchase
Request Confirmation, which amount shall be added to and shall constitute a portion of the
Murabaha Price for the Metals that are covered by such Transaction. A Supplemental Profit may be
added by TCO to the Murabaha Price of the Metals covered by such Purchase Request Confirmation if,
after the date hereof, TCO suffers any cost, expense or reduction in return in providing the
Financing hereunder as a direct or indirect result of any capital adequacy requirements or the
adoption or becoming effective of any change in law or in the interpretation, administration or
application thereof. The amount of such Supplemental Profit shall be calculated by TCO to offset
such cost, expense or reduction in return and specified by TCO in the Purchase Request
Confirmation for a Transaction. Supplemental Profit may also include amounts payable pursuant to
Section 3.4. Each determination by TCO of a Supplemental Profit amount shall be conclusive and
binding on Tensar.

     “Supplier” means Richmond Commodities Limited, a company formed under the laws of England and
Wales, or such other metals supplier as may be agreed upon by Tensar and TCO.

     “Tax”
or “Taxes” shall have the meaning specified in Section 3.3.

     “TCO” shall have the meaning specified in the preamble hereto.

     “Termination Date” means the fifth anniversary of the Effective Date.

 

7

     “Transaction” shall have the meaning specified in Section 2.1(a).

     “Transaction Date” means, (i) in relation to any Metals Transaction, the date on which Tensar
and TCO exchange a Purchase Offer and Purchase Acceptance for such Transaction in accordance with
Section 2.2 and (ii) in relation to any Goods Transaction, the date on which Tensar and TCO execute
an Agency Agreement for such Transaction in accordance with Section 2.3.

     “Unpaid Reimbursement Obligation” means any Reimbursement Obligation for which Tensar does
not reimburse TCO in accordance with the Reimbursement Letter.

     “Value Date” means, in relation to any Transaction, the date, which shall be a Business Day,
on which the Metals or Goods covered by such Transaction are delivered by TCO to Tensar in
accordance with this Agreement; provided, that, for all purposes hereunder, (a) such date for a
Metals Transaction shall be deemed to be the date that TCO funds the applicable purchase price for
the purchase of such Metals from Supplier pursuant to the terms hereof, and (b) such date for a
Goods Transaction shall be deemed to be the date that the letter of credit with respect to such
Transaction is drawn by, and all amounts available thereunder paid to, the Designated Seller.

Section 1.2. Rules of Interpretation

     (a) Sections 2, 3 and 4 of Schedule 1 are hereby incorporated herein by
reference in their entirety.

     Section 1.3. Schedules, Annexes and Exhibits. All of the schedules, annexes and exhibits
attached to this Agreement shall be deemed incorporated herein by reference.

ARTICLE II

REVOLVING PURCHASING FACILITY

Section 2.1. Revolving Purchasing Facility and Appointment of Agents.

     (a) Revolving Purchasing Facility. Subject to the terms and conditions hereof, and in
reliance upon the representations and warranties set forth herein, TCO agrees to make available to
Tensar financial accommodations consisting of a deferred payment revolving purchasing facility
(the “Facility”) from the Effective Date to the Termination Date, in an aggregate amount at any
one time outstanding (calculated as the then current Aggregate Purchase Price) not to exceed the
Maximum Facility Amount less the Reimbursement Letter Obligations Exposure. The Facility shall
only be used for (i) the purchase of Metals by TCO from the Supplier at the request of Tensar and
the on-sale of such Metals by TCO to Tensar, and (ii) the purchase of Goods by TCO from Designated
Sellers and the on sale of such Goods by TCO to Tensar, in each case subject to the terms and
conditions hereof. Each purchase of Metals by TCO at the request of Tensar and the on-sale of such
Metals by TCO to Tensar is herein referred to as a “Metals Transaction”; each purchase of Goods by
TCO at the request of Tensar and the on-sale of such Goods by TCO to Tensar is herein referred to
as a “Goods Transaction”; Metals Transactions and Goods Transactions are herein collectively
referred to as “Transactions” and

 

8

individually as a “Transaction”. The Facility shall be considered to be utilized at any time by an
amount equal to the Aggregate Purchase Price plus the Reimbursement Letter Obligations
Exposure, all determined at such time.

     (b) Appointment of AIFL as Agent. TCO hereby appoints AIFL as its agent to deal in its name,
place and stead, for the limited purpose of performing such acts as may be reasonably required in
order to enter into Metals Transactions approved by and at the risk of TCO (including without
limitation any transfer of funds from any accounts needed to implement any such Metals
Transaction), in each case subject to such instructions and limitations relating thereto as TCO may
provide from time to time. Subject to the limitations herein, (i) TCO authorizes AIFL to enter
into Metals Transactions covered by this Agreement, including without limitation the purchase of
Metals by TCO from the Supplier and the sale of Metals by TCO to Tensar, in each case in ATFL’s own
name as the agent and for the benefit of TCO, but for the account and at the sole risk of TCO, and
(ii) TCO authorizes AIFL to enter into Metals Transactions covered by this Agreement through any
agent, sub-agent, sub-contractor or representative (each, a “Sub-Agent”) which may carry out all or
part of the services to be provided by AIFL under this Agreement on such terms as it thinks fit,
provided, however that (A) any such Sub-Agent shall be a subsidiary, associate or affiliate of
AIFL; (B) the appointment of any such Sub-Agent shall not relieve AIFL of its obligations under
this Agreement; and (C) the appointment of and performance by any such Sub-Agent shall be at the
sole cost and expense of AIFL or such Sub-Agent.

     (c) Appointment
of AIA as Agent. Tensar hereby appoints AIA as its agent to deal in its name,
place and stead, for the limited purpose of performing such acts as may be reasonably required in
order to enter into Metals Transactions approved by and at the risk of Tensar (including without
limitation any transfer of funds from any accounts needed to implement any such Metals
Transaction), in each case subject to such instructions and limitations relating thereto as Tensar
may provide from time to time. For the purpose of the authority of AIA to act as the agent of
Tensar, a Metals Transaction shall be approved by Tensar upon the issuance of the Metals Purchase
Request by Tensar for the proposed Metals Transaction, a copy of which will be provided to ATA in
accordance with Section 2.2. Subject to the limitations herein, (i) Tensar authorizes AIA to
enter into Metals Transactions covered by this Agreement, including without limitation the purchase
of Metals by Tensar from TCO, and the on-sale of Metals by Tensar to third parties, in each case in
AIA’s own name as the agent and for the benefit of Tensar, but for the account and at the sole risk
of Tensar, and (ii) Tensar authorizes AIA (and without limiting AIA’s obligations hereunder) to
enter into Metals Transactions covered by this Agreement through any Sub-Agent, which may carry out
all or part of the services to be provided by AIA under this Agreement on such terms as it thinks
fit, provided, however, that (A) any such Sub-Agent shall be a subsidiary, associate or affiliate
of AIA; (B) the appointment of any such Sub-Agent shall not relieve AIA of its obligations under
this Agreement; and (C) the appointment of and performance by any Sub-Agent shall be at the sole
cost and expense of AIA or such Sub-Agent.

     (d) Appointment of Administrative Agent. TCO hereby appoints the Administrative Agent as its
agent for the purpose of taking all actions, exercising all rights and giving and receiving all
notices and instructions that may be taken, exercised, given or received directly by TCO hereunder
(other than those referred to in Section 2.1(b)), and TCO hereby authorizes the

 

9

Administrative Agent to take all such actions, to exercise all such rights and to give and receive
all such notices and instructions with the same effect as if taken, exercised, given or received by
TCO. All parties to this Agreement hereby acknowledge and agree to such appointment and agree to
accept the actions taken by the Administrative Agent, the rights exercised by the Administrative
Agent and the notices and instructions given by the Administrative Agent with the same force and
effect as if taken, exercised or given by TCO.

     Section 2.2. Metals Transactions.

     (a) Tensar may from time to time propose that TCO undertake a Metals Transaction by presenting
to TCO prior to 12:00 Noon (New York time) at least three Business Days prior to the proposed Value
Date of the requested Metals Transaction a written request for TCO’s purchase of Metals (each a
“Metals Purchase Request”) substantially in
the form of Exhibit A hereto. By copying AIA on
a Metals Purchase Request, Tensar authorizes AIA to act as agent of Tensar in the execution of the
proposed Metals Transaction, including execution of the Metals Purchase Offer for such proposed
Metals Transaction. Each Metals Purchase Request shall include (i) a general description of the
Metals to be purchased, (ii) the total price of the Metals to be paid by TCO to the Supplier, which
shall not be less than $500,000 and integral multiples of $100,000 in excess thereof, (iii) the
Value Date, which shall be at least three Business Days after the date of the Metals Purchase
Request, and (iv) the date on which the Murabaha Price is to be paid by Tensar in relation to such
Metals Transaction (the “Metals Transaction Payment Date”) and in the case of a Metals Transaction
with a Metals Transaction Payment Date of 6 months, 9 months or 12 months from the Value Date, each
Interim Metals Transaction Payment Date. TCO and Tensar agree that the Metals Transaction Payment
Date for a Metals Transaction shall be a date occurring two weeks or one, two, three or six months
after the Value Date for such Metals Transaction and shall not occur after the Termination Date;
provided, however, (A) if any Metals Transaction Payment Date or Interim Metals Transaction Payment
Date would occur on a day that is not a Business Day, such Metals Transaction Payment Date or
Interim Metals Transaction Payment Date, as the case may be, shall be extended to the next
succeeding Business Day (except if the next succeeding Business Day falls in the next succeeding
calendar month, then on the next preceding Business Day), (B) if in the calendar month in which the
Metals Transaction Payment Date or Interim Metals Transaction Payment Date is to occur there is no
day numerically corresponding to the Value Date, such Metals Transaction Payment Date or Interim
Metals Transaction Payment Date, as the case may be, shall be the last day of such calendar month
and (C) the Metals Transaction Payment Date shall be one month from the Value Date if Tensar fails
to specify the Metals Transaction Payment Date. Tensar agrees that it may not have more than ten
outstanding Metals Transactions at any time hereunder.

     (b) On the Value Date for a proposed Metals Transaction and subject to the satisfaction of
the conditions specified in Article IV and Section 3.5, TCO will confirm that it has purchased the
Metals requested by Tensar in the relevant Metals Purchase Request by executing and delivering to
Tensar a purchase request confirmation in substantially the form of Exhibit B (the “Metals
Purchase Confirmation”; a signed Metals Purchase Request and a signed Metals Purchase
Confirmation being referred to collectively as a “Metals Transaction Confirmation”). In
each Metals Purchase Confirmation, TCO shall (i) confirm (A) the terms on which the Metals
specified in the related Metals Purchase Request were purchased and (B) the willingness of TCO to
sell such Metals to Tensar, (ii) quote the price of the Metals paid by TCO,

 

10

the quantity of such Metals and the total Purchase Price for the same, and (iii) state the Murabaha
Price, as computed by TCO, to be paid by Tensar on the Metals Transaction Payment Date, and if
applicable, indicating the portion of such Murabaha Price which constitutes Interim Agreed Profit
to be paid on each Interim Metals Transaction Payment Date. TCO shall not be obligated to issue a
Metals Purchase Confirmation for any proposed Metals Transaction if, upon completion of such
proposed Metals Transaction, the Aggregate Purchase Price, plus the Reimbursement Letter
Obligations Exposure would exceed the Maximum Facility Amount.

     (c) Tensar acknowledges and agrees that the obligation of TCO to arrange for the purchase of,
and to purchase, Metals in accordance with a Metals Transaction Confirmation, is subject to the
satisfaction of all applicable conditions precedent set forth herein (including those conditions in
Sections 3.5 and 4.2).

     (d) After it receives a Metals Purchase Confirmation in accordance with Section 2.2(b), and
after TCO purchases the Metals specified in such Metals Purchase Confirmation, Tensar covenants and
agrees that it shall submit to TCO an offer, substantially in the form of Exhibit C (a
“Metals Purchase Offer”), in which Tensar offers to purchase such Metals from TCO on the terms
specified in the Metals Transaction Confirmation of which such Metals Purchase Confirmation forms a
part.

     (e) On the Business Day on which TCO completes its purchase of Metals from the Supplier in
accordance with this Section 2.2 and receives the Metals Purchase Offer, TCO covenants and agrees
that it shall issue to Tensar an acceptance, substantially in the form of Exhibit D (a
“Metals Purchase Acceptance”) in which TCO accepts Tensar’s offer to purchase the Metals as set
forth in the Metals Purchase Offer, subject to the satisfaction of all applicable conditions
precedent set forth herein. The Murabaha Price to be paid by Tensar for such Metals and the Value
Date and Metals Transaction Payment Date (and, if applicable, any Interim Metals Transaction
Payment Date) specified in the Metals Transaction Confirmation and Metals Purchase Offer shall be
confirmed by TCO in such Metals Purchase Acceptance, and Tensar hereby agrees to pay such Murabaha
Price to TCO on such Metals Transaction Payment Date and, if applicable, the Interim Agreed Profit
on each Interim Metals Transaction Payment Date.

Section 2.3.
Goods Transactions.

     (a) Tensar may from time to time propose that TCO undertake a Goods Transaction by presenting
to TCO a written request that TCO arrange for the purchase of certain Goods from a Designated
Seller (each, a “Goods Purchase Request”) substantially in the form of Exhibit E hereto.
Each Goods Purchase Request shall include a specific description of the Goods to be purchased and
all details of the proposed purchase, including the name of the seller of such Goods (the
“Designated Seller”), the purchase price to be paid by TCO for such Goods (the “Goods Purchase
Price”) and the last date for the completion of the purchase of such Goods from the Designated
Seller provided that no Goods Purchase Request shall provide that the last date for completion of
the purchase of such Goods shall be later than (i) the date one year after the date of the Goods
Purchase Request and (ii) the date that is five Business Days prior to the Termination Date.

 

11

     (b) If the terms of any Goods Purchase Request are acceptable to TCO, TCO shall transmit its
acceptance of Tensar’s proposal by promptly executing and delivering to Tensar an Agency Agreement
in the form set forth in Exhibit F hereto, pursuant to which TCO appoints Tensar as its
agent for the limited purpose of performing such acts as may be reasonably required to complete the
purchase of the Goods specified in such Goods Purchase Request, subject to such instructions and
limitations relating thereto as TCO may provide from time to time. TCO shall not be obligated to
execute and deliver an Agency Agreement for any proposed Goods Transaction if (i) the Aggregate
Purchase Price (including the Goods Purchase Price for the proposed Goods Transaction) plus the
Reimbursement Letter Obligations Exposure would exceed the Maximum Facility Amount, (ii) the
Aggregate Goods Undertakings (including the Goods Purchase Price for the proposed Goods
Transaction) plus the Reimbursement Letter Obligations Exposure would exceed $5,000,000 or (iii)
the conditions set forth in Article IV and Section 3.5 have not been satisfied. Upon receipt from
TCO of an executed Agency Agreement that is consistent with the related Goods Purchase Request
submitted by Tensar to TCO, Tensar shall execute such Agency Agreement and deliver it to TCO. A
signed Goods Purchase Request and Agency Agreement is herein collectively referred to
as a “Goods Transaction Confirmation”.

     (c) Once an Agency Agreement with respect to a Transaction has been entered into by Tensar and
TCO, Tensar, as agent of TCO, shall arrange for the purchase of Goods from the Designated Seller in
accordance with the terms of such Agency Agreement and this Agreement. Shipment and delivery of the
Goods will be made directly to and in the name of Tensar, as Agent of TCO, from the Designated
Seller. Tensar accepts full responsibility for arranging for pre- shipment inspection of the
Goods by its representatives and will be deemed to have warranted that the Goods to be purchased
have been inspected by it and that the condition of the Goods is satisfactory and that it desires
to purchase and accept delivery of the same. TCO shall make such arrangements to fund the purchase
of Goods as it may determine to be appropriate, including through the obtaining of documentary
letters of credit for the benefit of the Designated Seller in an amount equal to the anticipated
Purchase Price for such Goods and, Tensar agrees that its obligations to pay to TCO the Murabaha
Price for such Goods will be subject to clauses (f) and (g) below. Tensar acknowledges and agrees
that the obligation of TCO to arrange for the purchase, and to purchase Goods in accordance with an
Agency Agreement, is subject to the satisfaction of all conditions precedent set forth herein for
TCO’s obligations to provide accommodations under this Facility.

     (d) On the Business Day on which TCO takes possession of the documents of title (or other
evidence of ownership) of the Goods, TCO will so inform Tensar (such date of taking possession
being the “Value Date” for such Goods Transaction). Tensar covenants and agrees that, on the date
of such notice, it shall submit to TCO an offer, substantially in the form of Exhibit G (a
“Goods Purchase Offer”), in which Tensar offers to purchase such Goods from TCO on the terms
specified in the Goods Transaction Confirmation for such Goods. On the Business Day on which TCO
receives the Goods Purchase Offer for such Goods, TCO covenants and agrees that it shall issue to
Tensar an acceptance, substantially in the form of Exhibit H (a “Goods Purchase
Acceptance”) in which TCO accepts Tensar’s offer to purchase such Goods as set forth in the Goods
Purchase Offer. The Murabaha Price to be paid by Tensar for such Goods specified in the Goods
Transaction Confirmation and the Goods Purchase Offer shall be confirmed by TCO in such Goods
Purchase Acceptance, and Tensar hereby agrees to pay such

 

12

Murabaha Price (to the extent not previously paid) not later than the Business Day immediately
following after Tensar’s receipt of such Goods Purchase Acceptance (such payment date being the
“Goods Transaction Payment Date”).

     (e) TCO’s ownership interest in the Goods (and the related documents of title)
covered by a Goods Purchase Acceptance shall immediately pass from TCO to and be vested in
Tensar upon issuance by TCO of such Goods Purchase Acceptance, together with all rights and
obligations relating thereto (including the benefit of all of the Designated Seller’s warranties
and representations which are capable of being so transferred), whereupon the sale of such Goods
will be completed. TCO disclaims any liability for any damages to the Goods occurring after
delivery of the Purchase Acceptance with respect to such Goods to Tensar. Title to and risk of loss
of all Goods purchased by TCO hereunder shall vest in Tensar in accordance with this Section
2.3(e), regardless of the occurrence or non-occurrence of any other event whatsoever. Tensar agrees
to indemnify TCO against, and to hold TCO harmless from any and all claims, costs, expenses,
damages or liabilities of any kind resulting from, without limitation, any actual or alleged (i)
Lien on any Goods purchased by Tensar pursuant to this Agreement or (ii) defect in the quality,
quantity or characteristics of any such Goods.

     (f) Tensar’s obligations to pay to TCO the Murabaha Price of any Goods Transaction hereunder
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 relating to such Goods
Transaction or of any Commodities Purchase Facility 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
such letter of credit or any Commodities Purchase Facility Document; (iii) the existence of any
claim, setoff, defense or other right Tensar, or any person obligated with Tensar, any of Tensar’s
subsidiaries or other Affiliates or any other person may at any time have against the beneficiary
under any documentary letter of credit procured by TCO in connection with a Goods Transaction, TCO,
the Administrative Agent or any other person, whether in connection with this Agreement, any other
Commodities Purchase Facility Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a documentary letter of credit procured by TCO in
connection with a Goods Transaction 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 of such 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 any issuing bank, TCO, the Administrative 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 paragraph, constitute a legal or equitable discharge of the Tensar’s
obligations hereunder.

     (g) Without limiting the generality of the foregoing, it is expressly understood and agreed
that Tensar’s absolute and unconditional obligation hereunder to pay to TCO the Murabaha Price of
any Goods Transaction will not be excused by the gross negligence or willful misconduct of any
issuing bank of any documentary letter of credit procured by TCO in connection with such Goods
Transaction. However, the foregoing shall not be construed to excuse any such issuing bank from
liability to Tensar to the extent of any direct damages (as opposed to consequential damages,
claims in respect of which are hereby waived by Tensar to

 

13

the extent permitted by applicable law) suffered by Tensar that are caused by such 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 with respect to such letter of credit.

     (h) Tensar acknowledges and agrees that the obligation of TCO to arrange for the purchase of,
and to purchase, Goods and the issuance of a Goods Transaction Confirmation, is subject to the
satisfaction of all applicable conditions precedent set forth herein (including those conditions
in Sections 3.5 and 4.2).

     Section 2.4. Cash Collateralization. If any Event of Default shall occur and be continuing,
Tensar shall, on the Business Day it receives notice thereof from the Administrative Agent,
deposit in an account designated by the Administrative Agent, an amount in cash equal to the sum
of the Aggregate Goods Undertaking plus Reimbursement Letter Obligations Exposure as of such date.
Such deposit, and any amounts required to be remitted to TCO in connection with any Aggregate
Goods Undertaking or Reimbursement Letter Obligations Exposure pursuant to Section 3.7, which
shall also be deposited in such account, shall be held by TCO as collateral for the payment and
performance of the obligations, including reimbursement obligations, of Tensar under this
Agreement and under the Reimbursement Letter. TCO shall have exclusive dominion and control,
including the exclusive right of withdrawal, over such account. The amounts in such account may,
at the sole option of TCO, be deposited in Permitted Investments. Amounts in such account may be
applied by TCO towards the payment of any outstanding amounts hereunder or the cash
collateralization of any obligations of Tensar hereunder. Pending such application, TCO may use
the amounts in such account as cash collateral for any of its own obligations which it may be
obligated to so cash collateralize. If Tensar 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 Tensar within three Business Days after all Events of
Default have been cured or waived.

     Section 2.5. Assignment of Warranties. TCO hereby assigns to Tensar (to the extent permitted
by applicable law) any and all warranties and indemnities of, and claims against, (i) the Supplier
that TCO may have in relation to any Metals purchased by TCO from the Supplier and resold to
Tensar hereunder, (ii) the Designated Seller that TCO may have in relation to any Goods purchased
by TCO from the Designated Seller and resold to Tensar hereunder, and (iii) any dealers,
manufacturers, vendors, contractors or subcontractors in relation to such Metals or

 

14

Goods. If TCO is legally or contractually prohibited from assigning any such warranty, indemnity or
claim, TCO hereby grants to Tensar, to the extent permitted by applicable law, its entire
beneficial interest in such warranty, indemnity or claim. In consideration of the foregoing
assignment of warranties, indemnities and claims, Tensar hereby waives any claims it may have
against TCO in relation to the quality, quantity or other condition of any Metals or Goods, and
acknowledges and agrees that TCO shall not be deemed to have made any representation or warranty
relating to the Metals or the Goods, whether arising by implication, by common law or statute or
otherwise.

ARTICLE III

OTHER PROVISIONS RELATING TO THE FACILITY

     Section 3.1.
Payments. On the Metals Transaction Payment Date applicable to a Metals
Transaction, and on the Goods Transaction Payment Date applicable to a Goods Transaction, Tensar
shall pay to TCO the Murabaha Price (in immediately available funds) applicable to the Metals or
Goods that are the subject of such Transaction, and on each Interim Metals Transaction Date, if
any, applicable to a Metals Transaction, Tensar shall pay to TCO the Interim Agreed Profit payable
on such Interim Metals Transaction Date (in immediately available funds)
applicable to the Metals that are subject to such Metals Transaction. Tensar shall make such
payment to TCO before 12:00 Noon, New York time. Tensar shall make all payments owing to TCO
hereunder in U.S. dollars and in immediately available funds, by depositing or otherwise wire
transferring such payment into such account or accounts as may be designated from time to time by
TCO for such payments (each such account, a “Payment
Account”) and by the applicable required time
of payment. If any amount required to be paid to TCO hereunder is not paid when due, Tensar shall
pay a late fee on such amount at the Default Rate, payable on demand, from the due date for such
amount to the date it is paid in full.

     Section 3.2. Termination of the Facility. The Facility and TCO’s obligations under the
Reimbursement Letter shall automatically terminate on the Termination Date, unless terminated
sooner in accordance with Article VII. In addition, Tensar shall have the right at any time and
from time to time, upon 3 Business Days’ prior written notice to TCO to reduce the Maximum
Facility Amount by $1,000,000 and integral multiples of $500,000 in excess thereof, or to
terminate the Facility and TCO’s obligations under the Reimbursement Letter; provided however,
that the Maximum Facility Amount shall not be reduced to an amount that is less than the sum of
the Aggregate Purchase Price and the Reimbursement Letter Obligations Exposure then outstanding.
The termination of the Facility shall not constitute a termination of this Agreement, and such
termination or reduction shall not relieve Tensar of its obligation to pay all amounts due and
payable hereunder as and when due in accordance with the terms hereof.

     Section 3.3. Taxes

     (a) Any and all payments by Tensar to or for the account of TCO hereunder or under any other
Commodities Purchase Facility Document shall be made free and clear of and without deduction for
any and all present or future taxes, duties, levies, imposts, deductions, charges or withholdings,
and all liabilities with respect thereto, excluding taxes imposed on TCO’s net income, and
franchise taxes imposed on it, by the jurisdiction under the laws of which TCO is organized or any
political subdivision thereof (all such non-excluded taxes, duties, levies,

 

15

imposts, deductions, charges, withholdings, and liabilities being hereinafter referred to as
“Taxes”). If Tensar shall be required by law to deduct or withhold any Taxes from or in respect of
any sum payable under this Agreement or any other Commodities Purchase Facility Document to TCO,
(i) the sum payable shall be increased as necessary so that after making all required deductions
and withholdings (including deductions and withholdings applicable to additional sums payable under
this Section 3.3) TCO receives an amount equal to the sum it would have received had no such
deductions been made, (ii) Tensar shall make such deductions and withholdings, (iii) Tensar shall
pay the full amount deducted or withheld to the relevant taxation authority or other authority in
accordance with applicable law, and (iv) Tensar shall furnish to TCO the original or a certified
copy of a receipt evidencing payment thereof.

     (b) In addition, Tensar agrees to pay any and all present or future stamp or documentary taxes
and any other excise or property taxes or charges or similar levies that arise from any payment
made under this Agreement or any other Commodities Purchase Facility Document or from the execution
or delivery of, or otherwise with respect to, this Agreement or any other Commodities Purchase
Facility Document (hereinafter referred to as “Other
Taxes”).

     (c) Tensar shall indemnify TCO, within 10 days after written demand therefor, for the full
amount of any Taxes or Other Taxes paid or incurred by TCO, on or with respect to any payment by
or on account of any obligation of Tensar hereunder or under any other Commodities Purchase
Facility Document (including Taxes or Other Taxes imposed or asserted on or attributable to amounts
payable under this Section) and any penalties, interest and expenses arising therefrom or with
respect thereto, whether or not such Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or
liability delivered to Tensar by TCO or the Administrative
Agent shall be conclusive absent manifest error.

     (d) As soon as practicable after any payment of Taxes or Other Taxes pursuant to this Section,
and in any event within 30 days of any such payment being due, Tensar shall deliver (or cause to be
delivered) to the Administrative Agent the original or a certified copy of a receipt issued by such
Governmental Authority evidencing such payment, a copy of the return reporting such payment or
other evidence of such payment reasonably satisfactory to the Administrative Agent.

     Section 3.4. Adjustments to the Applicable Margin. If, after the date hereof, the adoption or
the becoming effective of, or any change in, or any change by any Governmental Authority, central
bank or comparable agency charged with the interpretation or administration thereof in the
interpretation or administration of, any applicable law, rule or regulation, or the occurrence of
any other event or circumstance (A) shall impose on TCO any requirements or conditions relating to
capital adequacy as a consequence of its commitments or obligations hereunder, (B) shall subject
TCO to, impose on TCO, or otherwise cause TCO to suffer any tax, duty or other charge with respect
to any Transaction or the amounts owed to it hereunder, (C) shall impose, modify, or deem
applicable any reserve, special deposit, assessment or similar requirement relating to any of the
Transactions, (D) shall impose on TCO or the London interbank market any other condition affecting
this Agreement or any Transaction, and the result of any of the foregoing is to increase the cost
or expense to, or otherwise impose on or cause

 

16

TCO to suffer any additional cost or expense in connection with or otherwise relating to entering
into or maintaining any Transaction, (E) shall reduce any sum received or receivable by TCO under
this Agreement or reduce the rate of return on TCO’s capital or assets as a consequence of its
commitments or obligations hereunder or (F) shall increase the cost or expense to, or impose an
additional cost or expense on, TCO or otherwise cause TCO to suffer any additional cost or expense
as a result of TCO performing its obligations under the Agreement or any other Commodities Purchase
Facility Document, TCO shall have the right to include a Supplemental Profit amount as part of the
Murabaha Price of one or more subsequent Transactions (so as to compensate TCO for the amount of
such increased cost or reduction or additional cost or expense or additional cost or expense). Each
determination by TCO under this section shall, absent manifest error, be conclusive and binding on
the parties hereto.

     Section 3.5. Unavailability of Funding. Tensar hereby agrees that the obligation of TCO to
provide the Facility shall be subject to the ability of TCO to obtain funding to enable it to
satisfy its obligations hereunder, and that if TCO at any time determines that it is unable to
obtain such funding on terms acceptable to TCO, TCO shall not have any further obligation to enter
into or consummate any Transactions hereunder (including any Transaction for which a Metals
Transaction Confirmation, a Goods Transaction Confirmation, a Metals Purchase Offer or a Goods
Purchase Offer has been delivered) until it subsequently determines that such funding is available
to TCO on terms that are acceptable to TCO. Without limiting the generality of the foregoing, TCO
shall expressly have no obligation whatsoever to seek to obtain any funding other than the funding
arrangements that TCO has in place as of the date hereof, and a lack of availability under such
funding arrangements for any reason shall excuse TCO from either any obligation to Tensar to
consummate any Transaction hereunder following such unavailability, or any other liability
relating to any such Transaction. The parties hereto acknowledge and agree that the provisions of
this Section 3.5 constitute a condition precedent to TCO’s obligation to provide accommodations
under the Facility.

     Section 3.6.
Evidence of Obligations. AIFL shall maintain a record of all material details of
each Metals Transaction and of each Goods Transaction. TCO shall maintain an account on its books
in the name of Tensar in which it shall record all material details of each Metals Transaction and
each Goods Transaction. TCO will make reasonable efforts to maintain
the accuracy of such account and to update promptly such account from time to time. TCO shall
render statements regarding such account to Tensar. The entries made in such account, and the
statements rendered to Tensar with respect thereto, shall be prima facie evidence of the existence
and amounts of the obligations of Tensar therein recorded (and all such statements, absent
manifest error, shall be conclusively presumed to be correct and accurate. Failure of AIFL or any
other person to keep a record of any Metals Transaction, Goods Transaction or Guarantee
Obligations shall not affect the obligations of Tensar hereunder or under the Reimbursement
Letter.

     Section 3.7. Prepayments; Termination of Facility.

     (a) Tensar covenants an agrees that at no time will the Aggregate Purchase Price exceed the
Maximum Facility Amount less the amount of any Reimbursement Letter Obligations Exposure (such
excess being an “Overage”). If at any time an Overage exists, such event shall not constitute an
Event of Default only if Tensar shall immediately prepay one or more of the

 

17

Murabaha Prices in respect of Metals Transactions (in the direct order of the Payment Dates
therefor) so that, upon the receipt and application of such prepayment, such Overage is eliminated.
To the extent an Overage continues to exist after such prepayment, Tensar shall remit to TCO an
amount equal to an remaining Overage, to be held by TCO as cash collateral in accordance with
Section 2.4.

     (b) Tensar may, upon 3 Business Days’ prior written notice to TCO (or telephone notice
promptly confirmed by written notice), repay all or any portion of any Murabaha Price before the
applicable Payment Dates therefor without penalty or premium (and without reduction in such
Murabaha Price as a result of such prepayment); provided however than any such early repayment
shall be in a minimum amount of $500,000 and integral multiples of $100,000.

     (c) Not later than the third Business Day following the receipt by Tensar Holdings, Tensar or
any of the Subsidiaries of Net Cash Proceeds arising from completion of any Asset Sale or the
occurrence of any Recovery Event, and to the extent that less than 100% of the Net Cash Proceeds
from such Asset Sale or Recovery Event have been applied towards the payment of the Acquisition
Cost of the Leased Assets under the Lease Agreement pursuant to an exercise of the Asset Sales
Option under the Put Option Letter, Tensar shall remit any such excess Net Cash Proceeds to TCO to
repay one or more Murabaha Prices in respect of Metals Transactions (in the direct order of the
Payment Dates therefor) and, thereafter, to be remitted to TCO for application in accordance with
Section 2.4.

     (d) In the event and on each occasion that an Equity Issuance occurs, and to the extent that
less than 100% of the Net Cash Proceeds from such Equity Issuance have been applied towards the
payment of the Acquisition Cost of the Leased Assets under the Lease Agreement pursuant to an
exercise of the Equity Issuance Option under the Put Option Letter, Tensar shall remit such excess
Net Cash Proceeds to TCO to repay one or more Murabaha Prices in respect of Metals Transactions (in
the direct order of the Payment Dates therefor) and, thereafter, to be remitted to TCO for
application in accordance with Section 2.4.

     (e) In the event that any Tensar Party receives Net Cash Proceeds from the issuance or other
incurrence of Financing Obligations of any Tensar Party (other than Financing Obligations
permitted to be incurred under Section 1.01 of Schedule 4 hereto), and to the extent that less than
100% of the Net Cash Proceeds from the issuance or incurrence of such Financing Obligations have
been applied towards the payment of the Acquisition Cost of the Leased Assets under the Lease
Agreement pursuant to an exercise of the Financing Obligation Option under the Put Option Letter,
Tensar shall remit such excess Net Cash Proceeds to TCO to repay one or more Murabaha Prices in
respect of Metals Transactions (in the direct order of the Payment Dates therefor) and, thereafter,
to be remitted to TCO for application in accordance
with Section 2.4.

     (f) Not later than the earlier of (1) 90 days after the end of each fiscal year of Tensar,
commencing with the fiscal year ending on December 31, 2006, and (2) the date which is five
Business Days after the date on which the financial statements with respect to such period are
delivered pursuant to Schedule 3 hereto, and to the extent that an amount less than (A) the
ECF Percentage times (B) the Excess Cash Flow for the fiscal year then ended has been applied
towards the payment of the Acquisition Cost of the Leased Assets under the Lease Agreement

 

18

pursuant to an exercise of the ECF Option under the Put Option Letter, Tensar shall remit such
excess amount to TCO to repay one or more Murabaha Prices in respect of Metals Transactions (in
the direct order of the Payment Dates therefor) and, thereafter, to be held as cash collateral in
accordance with Section 2.4.

     (f) Notwithstanding any other provision of this Agreement, in the event that it becomes
unlawful for (i) TCO to enter into Transactions or (ii) any person providing funding or other
financial accommodations to TCO to enable TCO to satisfy its obligations hereunder or under the
Reimbursement Letter, then TCO shall promptly notify Tensar thereof and, effective upon such
notice, TCO’s obligation to enter into Transactions hereunder and under the Reimbursement Letter
shall be suspended and the Aggregate Murabaha Price and any outstanding obligations under the
Reimbursement Letter shall become immediately due and payable. Upon the termination of such
situation, if at all, prior to the Termination Date, the obligation of TCO to enter into
Transactions hereunder shall be reinstated.

     Section 3.8. Fees. Tensar agrees to pay an up-front fee in the total amount of $2,000,000,
$1,500,000 of which shall be payable in equal installments of $75,000 on the last Business Day of
March, June, September and December of each year, and on the Termination Date, and $500,000 of
which shall be payable in equal installments of $125,000 on each anniversary of the Effective Date
up to but excluding the Termination Date.

     Section 3.9. Crediting Payments. The receipt of any payment item by TCO shall not be
considered a payment in respect of a Murabaha Price or other obligations hereunder or under the
Reimbursement Letter unless such payment item is a wire transfer of immediately available federal
funds made to the applicable Payment Account or unless and until such payment item is honored when
presented for payment. Should any payment item not be honored when presented for payment, then
Tensar shall be deemed not to have made such payment. Anything to the contrary contained herein
notwithstanding, any payment item shall be deemed received by TCO only if it is received into the
applicable Payment Account on a Business Day on or before 12:00 noon. (New York time). If any
payment item is received into the applicable Payment Account on a non-Business Day or after 12:00
noon (New York time) on a Business Day, it shall be deemed to have been received by TCO as of the
opening of business on the immediately following Business Day.

 

19

ARTICLE IV

CONDITIONS PRECEDENT

     Section 4.1. Initial Transaction. Notwithstanding any other provision of this Agreement, TCO
shall have no obligation to enter into or consummate the initial Transaction, or sign any
confirmation with respect thereto, unless and until this Agreement shall have been executed by the
parties hereto.

     Section 4.2. Each Transaction. TCO shall have no obligation to enter into or consummate any
Transaction (including the initial Transaction) or to issue a Goods Transaction Confirmation
hereunder unless and until the following conditions precedent are satisfied:.

(a) The Administrative Agent shall have received a Goods Purchase Request or a Metals
Purchase Request in accordance with this Agreement.

(b) The representations and warranties set forth in this Agreement, the other Commodities
Purchase Facility Documents and the Lease Documents shall be true and correct in all
material respects on and as of the time of entering into such Transaction or issuing such
Goods Transaction Confirmation, as the case may be, with the same effect as though made on
and as of such date, except to the extent such representations and warranties expressly
relate to an earlier date, in which case such representations and warranties shall be true
and correct in all material respects on and as of such earlier date.

(c) Each Tensar Party shall be in compliance with all the terms and provisions set forth in
each Lease Document and Commodities Purchase Facility Document on its part to be observed or
performed, and, at the time of and immediately after entering into such Transaction or
issuing such Goods Transaction Confirmation, as the case may be, no Event of Default or
Default shall have occurred and be continuing.

ARTICLE V

REPRESENTATIONS, WARRANTIES AND COVENANTS

     Section 5.1. Representations and Warranties. In order to induce TCO to enter into this
Agreement, Tensar Holdings and Tensar make the representations and warranties set forth on
Schedule 2 hereto to TCO, which shall be true, correct, and complete, in all material
respects, as of the Effective Date, and at and as of the date of each delivery of a Metals
Purchase Request, a Goods Purchase Request, a Metals Purchase Offer, a Goods Purchase Offer, each
Transaction Date and each Value Date, and each date on which TCO provides any Guarantee
Obligation, as applicable, as though made on and as of such date (except to the extent that such
representations and warranties relate solely to an earlier date).

 

 

20

     Section 5.2.
Affirmative Covenants. Tensar Holdings and Tensar hereby covenant and
agree that so long as this Agreement or the Reimbursement Letter is in effect or any amounts are
payable hereunder or under the Reimbursement Letter and until all commitments hereunder and under
the Reimbursement Letter shall have terminated, it shall and shall cause each of the other Tensar
Parties to observe and comply with the general covenants and agreements set forth in Schedule
3 hereto.

     Section 5.3.
Negative Covenants. Tensar Holdings and Tensar hereby covenant and agree that so
long as this Agreement or the Reimbursement Letter is in effect or any amounts are payable
hereunder or under the Reimbursement Letter and until all commitments hereunder and under the
Reimbursement Letter shall have terminated, it shall and shall cause each of the other Tensar
Parties to observe and comply with the covenants and agreements set forth in Schedule 4
hereto.

ARTICLE VI

EVENTS OF DEFAULT

     Schedule 5 is hereby incorporated herein by reference in its entirety.

ARTICLE VII

REMEDIES UPON DEFAULT

     The last paragraph of Schedule 5 is hereby incorporated herein by reference in its
entirety.

ARTICLE VIII

MISCELLANEOUS

     Section 8.1.
Notices. 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 fax, as follows:

	 	 	 	 	 
	 

	 	if to Tensar:
	 	The Tensar Corporation, LLC
	 

	 	 	 	5871 Glenridge Drive, Suite 330
	 

	 	 	 	Atlanta, GA 30328
	 

	 	 	 	Attn: Katherine Spear
	 

	 	 	 	Telephone: (404) 214-5375
	 

	 	 	 	Telecopy: (404) 214-5379
	 
	 	 	 	 
	 

	 	with copies to:
	 	Arcapita, Inc.
	 

	 	 	 	75 Fourteenth Street, 24th Floor
	 

	 	 	 	Atlanta, Georgia 30309
	 

	 	 	 	Attention: Scott Buschmann
	 

	 	 	 	Telephone: (404) 920-9000
	 

	 	 	 	Telecopy: (404) 920-9001

 

 

21

	 	 	 
	and:

	 	King & Spalding LLP
	 

	 	1185 Avenue of the Americas
	 

	 	New York, New York 10036
	 

	 	Attention: Isam Salah
	 

	 	Telephone: (212) 556-3140
	 

	 	Telecopy: (212) 556-2222
	 
	 	 
	if to TCO:

	 	TCO Funding Corp.
	 

	 	c/o Global Securitization Services, LLC
	 

	 	445 Broad Hollow Road
	 

	 	Suite 239
	 

	 	Melville, New York 11747
	 

	 	Attn: Andrew Stidd
	 

	 	Telephone: (631) 930-7203
	 

	 	Facsimile: (212) 302-8767
	 
	 	 
	with a copy to:

	 	King & Spalding LLP
	 

	 	1185 Avenue of the Americas
	 

	 	New York, New York 10036
	 

	 	Attention: Isam Salah
	 

	 	Telephone: (212) 556-3140
	 

	 	Telecopy: (212) 556-2222
	 
	 	 
	if to AIFL:

	 	Arcapita Investment Funding Limited
	 

	 	c/o Paget-Brown & Company
	 

	 	West Wind Building
	 

	 	P.O. Box 1111
	 

	 	Cayman Islands
	 

	 	B.W.I.
	 

	 	Attn: Mr. Sydney Coleman/
	 

	 	Ms. Patricia Tricarico
	 

	 	Telephone: (345) 949-5122
	 

	 	Facsimile: (345) 949-7920
	 
	 	 
	with a copy to:

	 	Arcapita Investment Funding Limited
	 

	 	P.O. Box 1406
	 

	 	Manama, Bahrain
	 

	 	Attn: Shahzad Iqbal
	 

	 	Telephone: 973-218-333
	 

	 	Facsimile: 973-218-217
	 
	 	 
	if to AIA:

	 	AIA Limited
	 

	 	c/o Paget-Brown & Company
	 

	 	West Wind Building
	 

	 	P.O. Box 1111
	 

	 	Cayman Islands, B.W.I.

 

 

22

	 	 	 
	 

	 	Attn: Mr. Sydney Coleman/
	 

	 	Ms. Patricia Tricarico
	 

	 	Telephone: (345) 949-5122
	 

	 	Facsimile: (345) 949-7920
	 
	 	 
	with a copy to:

	 	AIA Limited
	 

	 	P.O. Box 1406
	 

	 	Manama, Bahrain
	 

	 	Attn: Shahzad Iqbal
	 

	 	Telephone: 973-218-333
	 

	 	Facsimile: 973-218-217
	 
	 	 
	If to Administrative Agent:

	 	Credit Suisse
	 

	 	Eleven Madison Avenue
	 

	 	New York, NY 10010
	 

	 	Attn: Jill Hogan
	 

	 	Telephone : (212) 325-9092
	 

	 	Facsimile: (212) 743-1860
	 
	 	 
	 

	 	with a copy to:
	 

	 	Latham & Watkins LLP
	 

	 	885 Third Avenue,
	 

	 	New York, New York, 10022
	 

	 	Attn: Michele Penzer, Esq.
	 

	 	Telephone : 212-906-1200
	 

	 	Facsimile: 212-751-4864

All notices and other communications given to any party hereto in accordance with the
provisions of this Agreement shall be deemed to have been given on the date of receipt if delivered
by hand or overnight courier service or sent by fax or on the date five Business Days after
dispatch by certified or registered mail if mailed, in each case delivered, sent or mailed
(properly addressed) to such party as provided in this Section or in accordance with the latest
unrevoked direction from such party given in accordance with this Section.

     Section
8.2. Right of Set-Off; Adjustments. Upon the occurrence and during the continuance of
any Event of Default, TCO 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 at any time held and other
indebtedness or obligations at any time owed to Tensar by TCO against any and all of the
obligations of Tensar now or hereafter existing under this Agreement or any other Commodities
Purchase Facility Document or otherwise, irrespective of whether TCO shall have made any demand
hereunder or thereunder and although such obligations may be unmatured. TCO agrees promptly to
notify Tensar after any such set-off and application made by TCO; provided, however, that the
failure to give such notice shall not affect the validity of such set-off and application. The
rights of TCO under this Section 8.2 are in addition to other rights and

 

 

23

remedies (including, without limitation, other rights of set-off) that TCO may have.

     Section 8.3.
Benefit of Agreement; Assignments. This Agreement and the Reimbursement Letter
shall be binding upon and inure to the benefit of and be enforceable by the respective successors
and permitted assigns of the parties hereto; provided, that Tensar may not assign or transfer any
of its interests and obligations hereunder or under the Reimbursement Letter without the prior
written consent of TCO and any such assignment without such consent shall be null and void. TCO
shall have the right, without the consent of Tensar to collaterally assign and grant a security
interest in its rights hereunder, under the Reimbursement Letter and under any other documents
related hereto (including under the Guarantee and Collateral Agreement, the Mortgages and the other
Security Documents) in favor of any person. Any such assignee (and its successors, assigns and
agents) shall have the right to foreclose upon any such collateral assignment or security interest,
and exercise all rights and remedies under the applicable documentation relating thereto, without
any requirement for consent from Tensar, and Tensar agrees to fully cooperate with any such
exercise of rights or remedies by any such assignee (and its successors, assigns and agents).

     Section 8.4.
No Waiver; Remedies Cumulative. No failure or delay on the part of TCO in
exercising any right, power or privilege hereunder or under any other Commodities Purchase
Facility Document and no course of dealing between TCO and Tensar shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other right, power or
privilege hereunder. The rights and remedies provided herein are cumulative and not exclusive of
any rights or remedies that TCO would otherwise have. No notice to or demand on Tensar in any case
shall entitle Tensar to any other or further notice or demand in similar or other circumstances or
constitute a waiver of the rights of TCO to any other or further action in any circumstances
without notice or demand.

     Section 8.5.
Expenses; Indemnification; other Miscellaneous Provisions.

     (a) The provisions of Schedule 6 are hereby incorporated herein by reference in
their entirety.

     (b) Save where AIFL acts in bad faith or with willful or reckless indifference to the
interests of Tensar, Tensar hereby agrees to indemnify AIFL against all losses, claims,
actions, proceedings, damages, costs and expenses incurred or sustained by AIFL (or any
Sub-Agent of AIFL) as a result of the performance of its obligations hereunder or otherwise
relating to this Agreement, including without limitation losses, costs or expenses incurred
by AIFL (or any Sub-Agent of AIFL) as a result of Tensar’s failure to comply with Tensar’s
obligations. For the avoidance of doubt, if AIFL (or any Sub-Agent of AIFL) is required
to make any payment on account of any tax or otherwise on or in relation to any sum received
or receivable by it as a result of the performance of its obligations hereunder or any
liability in respect of any such payment is assumed, imposed, levied or assessed against
AIFL (or any Sub-Agent of AIFL), Tensar shall, upon the demand of AIFL, promptly indemnify
AIFL against such payment or liability, together with any other amounts, penalties, and
expenses payable or incurred in connection therewith.

 

 

24

     (c) Save where AIA acts in bad faith or with willful or reckless indifference to the
interests of Tensar, Tensar hereby agrees to indemnify AIA against all losses, claims,
actions, proceedings, damages, costs and expenses incurred or sustained by AIA (or any
Sub-Agent of AIA) as a result of the performance of its obligations hereunder or otherwise
relating to this Agreement, including without limitation losses, costs or expenses incurred
by AIA (or any Sub-Agent of AIA) as a result of Tensar’s failure to comply with Tensar’s
obligations. For the avoidance of doubt, if AIA (or any Sub-Agent of AIA) is required to
make any payment on account of any tax or otherwise on or in relation to any sum received or
receivable by it as a result of the performance of its obligations hereunder or any
liability in respect of any such payment is assumed, imposed, levied or assessed against AIA
(or any Sub-Agent of AIA), Tensar shall, upon the demand of AIA, promptly indemnify AIA
against such payment or liability, together with any other amounts, penalties, and expenses
payable or incurred in connection therewith.

     Section 8.6.
Amendments, Waivers and Consents. Neither this Agreement, the Reimbursement
Letter, any other Commodities Purchase Facility Document, or any other document entered into in
connection herewith or therewith or evidencing Obligations, any of the terms hereof or thereof may
be amended, changed, waived, discharged or terminated unless such amendment, change, waiver,
discharge or termination is in writing entered into by, or approved in writing by, TCO, the
Administrative Agent and Tensar. No express or implied waiver by TCO or the Administrative Agent
of any Default or Event of Default, shall in any way be, or be construed to be, a waiver of any
future or subsequent Default or Event of Default.

     Section 8.7.
Headings. The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of any provision of
this Agreement.

     Section 8.8.
Severability. If any provision of this Agreement is determined to be illegal,
invalid or unenforceable, such provision shall be fully severable and the remaining provisions
shall remain in full force and effect and shall be construed without giving effect to the illegal,
invalid or unenforceable provisions.

     Section 8.9.
Entirety. This Agreement represents the entire agreement of the parties hereto,
and supersedes all prior agreements and understandings, oral or written, if any, relating to
transactions contemplated herein.

     Section 8.10.
Tax Consequences. Tensar and TCO expressly agree that, for all income tax
purposes: (i) the transactions contemplated by this Agreement, together with the transactions
contemplated by the Letters of Undertaking, are intended to accomplish a single transaction that
is characterized as a mere financing by TCO to Tensar; (ii) the Aggregate Purchase Price
constitutes the principal amount of such financing; (iii) the amounts described in the definition
of “Agreed Profit” constitute interest accrued on such financing. Tensar and TCO (and any assignee
of TCO’s interest in this Agreement and any person to which a participation is granted) shall
report the tax consequences of the transactions described in clause (i) of this Section 8.10 on
their respective tax returns (to the extent same are required to be filed) consistently and in
accordance with the intended tax treatment described in this Section 8.10.

 

 

25

     Section 8.11.
Governing Law. THIS AGREEMENT AND THE OTHER COMMODITIES PURCHASE FACILITY
DOCUMENTS (OTHER THAN AS EXPRESSLY SET FORTH IN OTHER COMMODITIES PURCHASE FACILITY DOCUMENTS)
SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK.

     Section 8.12.
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 RESPECT OF ANY LITIGATION
DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE
OTHER COMMODITIES PURCHASE FACILITY DOCUMENTS. 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 AND THE OTHER COMMODITIES PURCHASE FACILITY DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 8.12.

     Section 8.13.
Jurisdiction; Consent to Service of Process. (a) Each party hereto hereby
irrevocably and unconditionally submits, for itself and its property, to the exclusive
jurisdiction of any New York State court or Federal court of the United States of America sitting
in New York City, and any appellate court from any thereof, in any action or proceeding arising
out of or relating to this Agreement or the other Commodities Purchase Facility Documents, or for
recognition or enforcement of any judgment, and each of the parties hereto 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 shall affect any right that the Administrative
Agent or TCO may otherwise have to bring any action or proceeding relating to this Agreement or
the other Commodities Purchase Facility Documents against any Tensar
Party, AIA or AIFL or their
respective properties in the courts of any jurisdiction.

     (b) Each party hereto 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 the
other Commodities Purchase Facility Documents in any New York State or Federal court. 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.

     (c) Each party to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 8.1. Nothing in this Agreement will affect the right of any party
to this Agreement to serve process in any other manner permitted by law.

 

 

26

     Section 8.14.
Counterparts. This Agreement may be executed in any number of counterparts, each
of which when so executed and delivered shall be an original, but all of which shall constitute one
and the same instrument. Delivery by facsimile by any of the parties hereto of an executed
counterpart of this Agreement shall be as effective as an original executed counterpart hereof and
shall be deemed a representation that an original executed counterpart hereof will be delivered.

     Section
8.15. Conflicts. To the extent that there shall exist a conflict between the terms or
provisions of this Agreement, on the one hand, and the terms of any exhibit hereto that is
executed and delivered in connection with a Transaction, the parties hereto expressly acknowledge
and agree that the terms and provisions of this Agreement shall in all events and for all purposes
be controlling.

[Signature Pages Follows]

 

 

     IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this Working
Capital Murabaha Facility Agreement to be duly executed and delivered as of the date first above
written.

	 	 	 	 	 	 	 
	 	 	THE TENSAR CORPORATION, LLC	 	 
	 
	 	By	 	/s/ KATHERINE SPEAR	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: KATHERINE SPEAR
	 	 
	 

	 	 	 	Title: CHIEF FINANCIAL OFFICER	 	 
	 
	 	 	 	 	 	 
	 	 	TENSAR HOLDINGS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	/s/ E. STOCKTON CROFT	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: E. STOCKTON CROFT	 	 
	 

	 	 	 	Title: PRESIDENT	 	 
	 
	 	 	 	 	 	 
	 	 	TCO FUNDING CORP.	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	/s/ KATHERINE SPEAR	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: KATHERINE SPEAR	 	 
	 

	 	 	 	Title: CHIEF FINANCIAL OFFICER	 	 
	 
	 	 	 	 	 	 
	 	 	ARCAPITA INVESTMENT FUNDING LIMITED	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	/s/ HENRY THOMPSON	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: HENRY THOMPSON	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	AIA LIMITED	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	/s/ HENRY THOMPSON
	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: HENRY THOMPSON	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	CREDIT SUISSE, Cayman Islands Branch, as

Administrative Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By
	 	/s/ PHILLIP HO	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: PHILLIP HO	 	 
	 

	 	 	 	Title: DIRECTOR	 	 
	 
	 	 	 	 	 	 
	 

	 	By
	 	/s/ RIANKA MOHAN	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: RIANKA MOHAN	 	 
	 

	 	 	 	Title: ASSOCIATE	 	 

[Signature Page to Working Capital Murabaha Facility Agreement]

 

 

Schedule 1

DEFINITIONS

 

 

Execution
Copy

MURABAHA RIDERS

Schedule 1

Definitions

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

     “Acquired
Assets” shall mean the assets acquired by TCO from Tensar pursuant to the
Asset Purchase Agreement.

     “Acquisition” shall mean the acquisition by Tensar Holdings pursuant to the Merger
Agreement of all the Equity Interests in Holdings from the Sellers; the aggregate amount
of consideration for the Acquisition is approximately $201,900,000
(the “Acquisition Consideration”).

     “Acquisition
Cost” shall have the meaning assigned to such term in the Lease
Agreement.

     “Acquisition
Consideration” shall have the meaning assigned to such term in
the definition of “Acquisition”.

     “Acquisition
Documentation” shall mean, collectively, the Merger Agreement and all
schedules, exhibits, annexes and amendments thereto and all side letters and agreements affecting
the terms thereof or entered into in connection therewith.

     “Acquisition Transactions” shall mean, collectively, (a) the Acquisition, including
the
payment of the Acquisition Consideration, (b) the Equity Contribution, (c)(i) the consummation
of the transactions contemplated by the Asset Purchase Agreement and (ii) the obtaining
by Tensar of the Lease Agreement, (d) the obtaining by Tensar of this Commodities
Purchase Facility, (e) the obtaining by Tensar of the Second Lien Commodities Purchase
Facility, (f) the obtaining by Tensar Holdings of the Tensar Holdings Commodities
Purchase Facility, (g) the repayment by Holdings and Tensar of all Existing Obligations,
the termination of the Existing Credit Facility and the release of all Liens and
guarantees granted in respect thereof and any other Existing Obligations, in each case in
a manner satisfactory to TCO and the Administrative Agent and (h) the payment of fees and
expenses incurred in connection with the foregoing.

     “Administrative Agent” shall mean Credit Suisse acting through its Cayman
Islands branch.

     “Affiliate” shall mean, when used with respect to a specified person, another person
that directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the person specified;
provided, however, that, for purposes of Schedule 4, the term “Affiliate” shall also include
any person that directly or indirectly owns 5% or more of any class of Equity Interests
of the person specified or that is an officer or director of the
person specified.

Schedule
1, Defined Terms

 

 

     “Affiliate
Subordination Agreement” shall mean an Affiliate
Subordination Agreement in the form of Exhibit K pursuant to which intercompany obligations
and advances owed by any Tensar Party are subordinated to the Obligations.

     “Agreement” shall have the meaning assigned to such term in the preamble.

     “Asset
Purchase Agreement” shall mean the Asset Purchase Agreement, dated as of
October 31, 2005, among TCO and Tensar, as the same may be amended, supplemented or modified
from time to time in accordance with the provisions hereof.

     “Asset
Sale” shall mean the sale, lease, sub-lease, license, sub-license, sale and
leaseback, assignment, conveyance, transfer, issuance or other disposition (by way of
merger, casualty, condemnation or otherwise) by any Tensar Party or any of the Subsidiaries
to any person (other than Tensar or any Subsidiary Guarantor) of (a) any Equity Interests
of any of the Subsidiaries or (b) any other assets of any Tensar Party or any of the
Subsidiaries, including Equity Interests of any person that is not a Subsidiary;
provided that any asset sale or series of related asset sales described in clause
(b) above having a value not in excess of $250,000 shall be deemed not to be an “Asset
Sale” for purposes of this Agreement.

     “Benefit
Plan” shall mean any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the
Tax Code or Section 307 of ERISA, and in respect of which Tensar 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.

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

     “Business
Day” shall mean any day other than a Saturday, Sunday or day on which
commercial banks in New York City, Dallas, Texas, and Atlanta, Georgia are authorized or
required by law to close; provided,  however, that when used in connection with any
payment to TCO or the Administrative Agent required hereunder (including with respect to
all notices and determinations in connection therewith), 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” shall mean, for any period, with respect to any
person, (a) the additions to property, plant and equipment and other capital expenditures
of such person and its consolidated subsidiaries that are (or should be) set forth in a
consolidated statement of cash flows of such person for such period prepared in accordance
with GAAP and (b) Capital Lease Obligations incurred by such person and its consolidated
subsidiaries during such period, provided that, for purposes of determining compliance
with Section 1.10 of Schedule 4, all Capital Expenditures incurred prior to October 1,
2005, shall be excluded.

     “Capital
Lease Obligations” of any person shall mean the obligations of such
person to pay rent or other amounts under any lease of (or other arrangement conveying the
right to use) real or personal property, or a combination thereof, which obligations are
required to be classified and accounted for as capital leases on a balance sheet of such
person under GAAP, and

Schedule
1, Defined Terms

2

 

the amount of such obligations at any time shall be the capitalized amount thereof at such
time determined in accordance with GAAP.

     A “Change in Control” shall be deemed to have occurred if (a) at any time prior to a
Qualified IPO, the Permitted Holders shall fail to own directly or indirectly, beneficially and of
record, Equity Interests representing at least 66 2/3% of the aggregate ordinary voting power and
aggregate equity value represented by the issued and outstanding Equity Interests in Tensar
Holdings; (b) after a Qualified IPO, any “person” or “group” (within the meaning of Rule 13d-5 of
the Securities Exchange Act of 1934 as in effect on the date hereof) other than the Permitted
Holders shall own directly or indirectly, beneficially or of record, Equity Interests representing
either (i) more than 30% of either the aggregate ordinary voting power or the aggregate equity
value represented by the issued and outstanding Equity Interests in Tensar Holdings or (ii) a
greater percentage of either the aggregate ordinary voting power or the aggregate equity value
represented by the issued and outstanding Equity Interests in Tensar Holdings then held, directly
or indirectly, beneficially and of record, by the Permitted Holders; (c) a majority of the seats
(other than vacant seats) on the board of directors of Tensar Holdings shall at any time be
occupied by persons who are not Continuing Directors; (d) Tensar Holdings shall at any time fail to
own directly or indirectly, beneficially and of record, 100% of each class of issued and
outstanding Equity Interests in Holdings or Holdings shall fail to own directly or indirectly,
beneficially and of record, 100% of each class of issued and outstanding Equity Interests in
Tensar, in each case, free and clear of all Liens (except Liens created by the Guarantee and
Collateral Agreement or by the Second Lien Commodities Purchase Facility Documents); or (e) any
change of control (or similar event, however denominated) with respect to any Tensar Party or any
Subsidiary shall occur under and as defined in the Related Financing Documents.

     “Collateral” shall mean all property and assets of the Tensar Parties, now owned or hereafter
acquired, upon which a Lien is purported to be created by any Security Document, and shall include
the Mortgaged Properties.

     “Commodities Purchase Facility Documents” shall mean this Agreement and all other
instruments, agreements and other documents evidencing or governing the foregoing or providing for
any Guarantee, Lien or other right in respect thereof, including the Reimbursement Letter and the
Security Documents, as the same may be amended, supplemented or otherwise modified in accordance
with the terms hereof.

     “Commodities Purchase Facility” shall mean the working capital Murabaha facility
provided for in this Agreement.

     “Confidential Information Memorandum” shall mean the Confidential Information
Memorandum of Tensar dated October 2005.

     “Consolidated EBITDA” shall mean, for any period, Consolidated Net Income for such
period plus (a) without duplication and to the extent deducted in determining such Consolidated
Net Income, the sum of (i) Consolidated Financing Expense for such period, (ii) consolidated
income tax expense for such period, (iii) all amounts attributable to depreciation and
amortization for such period (including but not limited to any amortized obligation discount,
amortized administrative expense and amortized hedging transaction expense), (iv) the

Schedule
1, Defined Terms

3

 

adjustments set forth on Annex l(c) to Schedule 1, (v) management fees paid to the Sponsor
for such period to the extent permitted by Section 1.07 of Schedule 4 not to exceed $1,000,000 per
fiscal year, (vi) the amount of the Earnout Payment to the extent paid in cash and not to exceed
$3,000,000, (vii) any reduction to Consolidated Net Income as a result of extraordinary losses,
and (viii) any non-cash charges (other than the write-down of current assets) for such period
(provided that to the extent that all or any portion of the income of any person is
excluded from Consolidated Net Income pursuant to the definition thereof for all or any portion of
such period any amounts set forth in the preceding clauses (i) through (viii) that are
attributable to such person shall not be included for purposes of this definition for such period
or portion thereof), and minus (b) without duplication (i) all cash payments made during such
period on account of reserves, restructuring charges and other non-cash charges added to
Consolidated Net Income pursuant to clause (a)(viii) above in a previous period and (ii) to the
extent included in determining such Consolidated Net Income, any extraordinary gains and all
non-cash items of income for such period, all determined on a consolidated basis in accordance
with GAAP; provided that for purposes of calculating Consolidated EBITDA for any period to
determine the Leverage Ratio or the First Lien Leverage Ratio, (A) the Consolidated EBITDA of any
Acquired Entity acquired by Tensar or any Subsidiary during such period pursuant to a Permitted
Acquisition which has Consolidated EBITDA in excess of $500,000 for such period, shall be included
on a pro  forma basis for such period (assuming the consummation of such acquisition and
the incurrence or assumption of any Financing Obligations in connection therewith occurred as of
the first day of such period) and (B) the Consolidated EBITDA of any person or line of business
sold or otherwise disposed of during such period by Tensar or any Subsidiary which has
Consolidated EBITDA in excess of $500,000 for such period for shall be excluded for such period
(assuming the consummation of such sale or other disposition and the repayment of any Financing
Obligations in connection therewith occurred as of the first day of such period).

     “Consolidated Financing Expense” shall mean, for any period, the sum of (a) rent or
profit expense or the Rental Rate portion of rent of Tensar Holdings and its Subsidiaries for such
period (including all Agreed Profit, Supplemental Profit and the Rental Rate portion of Rent
payable, agreed profit under the Second Lien Commodities Purchase Agreement and all commissions,
discounts and other fees and charges owed by Tensar and the Subsidiaries with respect to Guarantee
Obligations under the Reimbursement Letter, letters of credit and bankers’ acceptance financing),
in each case determined on a consolidated basis in accordance with GAAP, plus (b) any profit
expense or the rental rate portion of any rent of Tensar or any Subsidiary that is required to be
capitalized rather than expensed for such period in accordance with GAAP, plus (c) any other
similar expense under GAAP.

     “Consolidated Fixed Charges” shall mean, for any period, without duplication, the sum of (a)
Consolidated Financing Expense for such period paid in cash, (b) the aggregate amount of scheduled
Acquisition Cost payments in respect of the Leased Assets or scheduled payments (whether or not
made) during such period to reduce the unpaid stated amount in respect of long term Financing
Obligations (including Capital Lease Obligations and Synthetic Lease Obligations, but excluding
payments applied to Purchase Price under the Commodities Purchase Facility) of Tensar and its
Subsidiaries (other than payments made by Tensar or any of its Subsidiaries to Tensar or another
Subsidiary), (c) Capital Expenditures for such period, less Capital Expenditures incurred in
connection with the new BX geogrid manufacturing line in Morrow, Georgia, and (d) the aggregate
amount of Taxes paid in cash (net of refunds received

Schedule
1, Defined Terms

4

 

with respect to such Taxes) payable by Holdings and its Subsidiaries during such period in
accordance with Section 1.06(iii)(y) of Schedule 4.

     “Consolidated Net Income” shall mean, for any period, the net income or loss of
Tensar Holdings and its Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP; provided that there shall be excluded (a) the income of any
Subsidiary of Tensar to the extent that the declaration or payment of dividends or similar
distributions by such Subsidiary of that income is not at the time permitted by operation of the
terms of any agreement, instrument, or Requirement of Law applicable to such Subsidiary, (b) the
income or loss of any person accrued prior to the date it becomes a Subsidiary of Tensar or is
merged into or consolidated with Tensar or any of its Subsidiaries or the date that such person’s
assets are acquired by Tensar or any of its Subsidiaries, (c) the income of any person (other than
a Subsidiary of Tensar) in which any other person (other than Tensar or a wholly owned Subsidiary
of Tensar or any director holding qualifying shares in accordance with applicable law) has an
interest, except to the extent of the amount of dividends or other distributions actually paid to
Tensar or a wholly owned Subsidiary thereof by such person during such period, (d) any gains
attributable to sales of assets out of the ordinary course of business and (e) the Consolidated
Net Income of the Merex Companies shall be excluded.

     “Contech Agreement” shall mean the Amended and Restated National Sales and Marketing
Agreement, dated as of January 1, 2002, between Contech Construction Products Inc. and Tensar.

     “Continuing Directors” shall mean, at any time, any member of the board of directors of Tensar
Holdings who (a) was a member of such board of directors on the Effective Date, after giving effect
to the Acquisition, or (b) was nominated for election or elected to such board of directors with
the approval of a majority of the Continuing Directors who were members of such board of directors
at the time of such nomination or election.

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

     “Current Assets” shall mean, at any time, the consolidated current assets (other than cash
and Permitted Investments) of Tensar and its Subsidiaries.

     “Current Liabilities” shall mean, at any time, the consolidated current liabilities of
Tensar and its Subsidiaries at such time, but excluding, without duplication, (a) the current
portion of any long-term Financing Obligations and (b) outstanding obligations with respect to
Murabaha Price under the Commodities Purchase Agreement.

     “Default” shall mean any event or condition which constitutes an Event of Default or which
upon notice, lapse of time or both would constitute an Event of Default.

     “dollars”
or “$” shall mean lawful money of the United States of America.

 Schedule
1, Defined Terms

5

 

     “Domestic Subsidiaries” shall mean all Subsidiaries incorporated, formed
or organized under the laws of the United States of America, any State thereof or the
District of Columbia.

     “Earnout
Payment” shall mean any additional payment required to be made to Dr.
Nathaniel Fox pursuant to the Stock Purchase Agreement, dated as of July 31, 2002, between
Nathaniel Fox and Michael Fox, as sellers, and Tensar and Holdings, as buyers, pertaining
to the purchase of the stock and business of Geopier Foundation, Inc. and Geotechnical
Reinforcement Company, Inc. (the “Geopier Agreement”) in an amount equal to 50% of the
amount by which the combined “EBITDA” (as defined in the Geopier Agreement) of Geopier
Foundation Company, Inc., a Georgia corporation, and Geotechnical Reinforcement Company,
Inc., a Georgia corporation, for the fiscal year 2005 exceeds $3,498,012.50.

     “Effective
Date” shall mean the date of this Agreement.

     “Environmental Laws” shall mean all former, current and future Federal, state,
local and foreign laws (including common law), treaties, regulations, rules, ordinances,
codes, decrees, judgments, directives, orders (including consent orders), and agreements in
each case relating to protection of the environment, natural resources, human health and
safety or the presence, Release of, threatened Release, or exposure to, Hazardous
Materials, or the generation, manufacture, processing, distribution, use, treatment,
storage, transport, recycling or handling of, or the arrangement for such activities with
respect to, Hazardous Materials.

     “Environmental Liability” shall mean all liabilities, obligations, damages, losses,
claims, actions, suits, judgments, orders, fines, penalties, fees, expenses and
costs (including administrative oversight costs, natural resource damages remediation costs,
legal fees and consulting costs), whether contingent or otherwise, arising, out of or relating to
(a) compliance or non-compliance with 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 or (e) any
contract, agreement or other consensual arrangement pursuant to which liability is assumed
or imposed with respect to any of the foregoing.

     “Environmental Permit” shall mean any Permit under Environmental Law.

     “Equity Contribution” shall mean, collectively, (a) the contribution by the
Sponsor and certain other investors acceptable to Tensar Holdings and the Administrative
Agent of at least $121,300,000, other than up to $7,700,000 of such contribution which may
be in the form of rollover equity of management, to Tensar Holdings as common equity,
preferred equity and/or subordinated shareholder loans having terms reasonably satisfactory
to Tensar Holdings and the Administrative Agent and (b) the contribution by Tensar Holdings
of the amount so received in clause (a) to Holdings in cash in exchange for the issuance to
Tensar Holdings of all the common stock of Holdings and (c) the contribution by Holdings of
the amount so received in clause (b) to Tensar in cash in exchange for the issuance to
Holdings of all the membership interests of Tensar.

     “Equity Interests” shall mean shares of capital stock, partnership interests,
membership interests in a limited liability company, beneficial interests in a trust or
other equity interests in

 Schedule
1, Defined Terms

6

 

any person, or any obligations convertible into or exchangeable for, or giving any
person a right, option or warrant to acquire, such equity interests or such convertible or
exchangeable obligations.

     “Equity
Issuance” shall mean any issuance or sale by Tensar Holdings of any Equity
Interests of Tensar Holdings, or the receipt by Tensar Holdings of any capital contribution,
except in each case for (a) any issuance of directors’ qualifying shares and (b) sales or
issuances of common stock of Tensar Holdings to management or employees of Tensar Holdings,
Tensar or any Subsidiary under any employee stock option or stock purchase plan or employee
benefit plan in existence from time to time in the ordinary course of business.

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

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

     “ERISA
Event” shall mean (a) any “reportable event”, as defined in Section 4043 of ERISA or
the regulations issued thereunder, with respect to a Benefit Plan (other than an event for which
the 30-day notice period is waived); (b) the existence with respect to any Benefit Plan of an
“accumulated funding deficiency” (as defined in Section 412 of the Tax Code or Section 302 of
ERISA), whether or not waived; (c) the filing pursuant to Section 412(d) of the Tax Code or
Section 303(d) of ERISA of an application for a waiver of the minimum funding standard with
respect to any Benefit Plan; (d) the incurrence by Tensar or any
of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Benefit  Plan or the
withdrawal or partial withdrawal of Tensar or any of its ERISA Affiliates from any Benefit Plan or
Multiemployer Plan; (e) the receipt by Tensar or any of its ERISA Affiliates from the PBGC or a
plan administrator of any notice relating to the intention to terminate any Benefit Plan or Plans
or to appoint a trustee to administer any Benefit Plan; (f) the adoption of any amendment to a
Benefit Plan that would require the provision of security pursuant to Section 401(a)(29) of the
Tax Code or Section 307 of ERISA; (g) the receipt by Tensar or any of its ERISA Affiliates of any
notice, or the receipt by any Multiemployer Plan from Tensar or any of its ERISA Affiliates of any
notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer
Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of
ERISA; (h) the occurrence of a “prohibited transaction” with respect to which Tensar or any of its
Subsidiaries is a “disqualified person” (within the meaning of Section 4975 of the Tax Code) or
with respect to which Tensar or any such Subsidiary could otherwise be liable; or (i) any other
event or condition with respect to a Benefit Plan or Multiemployer Plan that could result in
liability of Tensar or any Subsidiary.

     “Event
of Default” shall have the meaning assigned to such term in Schedule 5.

     “Excess
Cash Flow” shall mean, for any fiscal year of Tensar Holdings, the excess
of (a) the sum, without duplication, of (i) Consolidated EBITDA for such fiscal year and (ii)
the decrease, if any, in Current Assets minus Current Liabilities from the beginning to the
end of

Schedule
1, Defined Terms

7

 

such fiscal year over (b) the sum, without duplication, of (i) the amount of any Taxes payable
(net of refunds received with respect to such Taxes in such fiscal year) in cash by Tensar and its
Subsidiaries with respect to such fiscal year, (ii) Consolidated Financing Expense for such fiscal
year payable in cash, (iii) Capital Expenditures made in cash in accordance with Section 1.10 of
Schedule 4 during such fiscal year, except to the extent financed with the proceeds of Financing
Obligations, equity issuances, casualty proceeds, condemnation proceeds or other proceeds that
would not be included in Consolidated EBITDA, (iv) permanent repayments of Financing Obligations
(other than mandatory prepayments of Acquisition Cost pursuant to the terms hereof) permitted
hereunder made by Tensar and its Subsidiaries during such fiscal year, but only to the extent that
such prepayments by their terms cannot be redrawn and do not occur in connection with a refinancing
of all or any portion of such Financing Obligations and (v) the increase, if any, in Current Assets
minus Current Liabilities from the beginning to the end of such fiscal year.

     “Excluded Foreign Subsidiaries” shall mean, at any time, any Foreign Subsidiary that
is (or is treated as) for United States federal income tax purposes either (a) a corporation or
(b) a pass-through entity owned directly or indirectly by another Foreign Subsidiary that is (or
is treated as) a corporation.

     
“Existing Credit Facility” shall mean the credit facility of Holdings under the
Second Amended and Restated Credit Agreement dated as of December 22, 2004, among Holdings,
certain subsidiaries of Tensar, General Electric Capital Corporation, as a lender and as agent for
all lenders, and the other lenders party thereto.

     “Existing Obligations” shall mean the (i) the Existing Credit Facility, (ii) the Mezzanine
Credit Agreement, dated as of December 22, 2004, among Tensar, certain subsidiaries of Tensar
and the lenders named therein and (iii) the PIK Notes issued pursuant to the PIK Note Purchase
Agreement, dated as of December 22, 2004; as amended, among Tensar, Tensar Sub-Holdings,
Inc., Merrill Lynch PCG, Inc., American Capital Strategies, Ltd. and Stark Event Trading Ltd.

     “Event of Loss” shall have the meaning assigned to such term in the Lease Agreement.

     “Financial Officer” of any person shall mean the chief financial officer, principal
accounting officer, treasurer or controller of such person.

     “Financing Coverage Ratio” shall mean, on any date, the ratio of (a) Consolidated
EBITDA for the period of four consecutive fiscal quarters most recently ended on or prior to such
date, taken as one accounting period, to (b) Consolidated Financing Expense for the period of
four consecutive fiscal quarters ended on or prior to such date, taken as one accounting period.

     “Financing
Obligations” of any person shall mean, without duplication, (a) all
obligations of such person in respect of any financing, including for borrowed money (including
Acquisition Cost, any Purchase Price and any Unpaid Reimbursement Obligations) or with respect to
deposits or advances of any kind or under any other Murabaha arrangements or Ijara arrangements,
(b) all obligations of such person evidenced by bonds, debentures, notes or similar instruments,
(c) all obligations of such person under conditional sale or other title retention agreements
relating to property or assets acquired by such person, (d) all obligations of such

Schedule
1, Defined Terms

8

 

person in respect of the deferred purchase price of property or services (other than
current trade accounts payable incurred in the ordinary course of business), (e) all
obligations of such person, contingent or otherwise, to purchase, redeem, retire or otherwise
acquire for value any Equity Interests in such person, (f) all Financing Obligations of others
secured by (or for which the holder of such Financing Obligations has an existing right,
contingent or otherwise, to be secured by) any Lien on property owned or acquired by such
person, whether or not the Financing Obligations secured thereby has been assumed, (g) all
Guarantees by such person of Financing Obligations of others, (h) all Capital Lease
Obligations or Synthetic Lease Obligations of such person, (i) all obligations, contingent or
otherwise, of such person as an account party in respect of letters of credit and letters of
guaranty and (j) all obligations, contingent or otherwise, of such person in respect of
bankers’ acceptances. The Financing Obligations of any person shall include the Financing
Obligations of any other person (including any partnership in which such person is a general
partner) to the extent such person is liable therefor as a result of such person’s ownership
interest in, or other relationship with, such other person, except to the extent the terms of
such Financing Obligations provide that such person is not liable therefor. For the avoidance
of doubt, it is the intention of the Tensar Parties to incur only financing obligations
acceptable under Islamic Shari’ah principles.

     
“First Lien Leverage Ratio”  shall mean, on any date, the ratio of (a) Total
Obligations with respect to this Agreement and the Lease Agreement on such date to (b)
Consolidated EBITDA for the period of four consecutive fiscal quarters most recently ended on
or prior to such date, taken as one accounting period.

     “Fixed
Charge Coverage Ratio”  shall mean, on any date, the ratio of (a)
Consolidated EBITDA for the period of four consecutive fiscal quarters most recently ended on
or prior to such date, taken as one accounting period, to (b) Consolidated Fixed Charges for
such period, taken as one accounting period.

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

     “GAAP” shall mean generally accepted accounting principles in the United States.

     “Governmental
Authority” shall mean the government of the United States of
America or any other nation, 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”
of or by any person (the “guarantor”) shall mean any obligation, contingent or
otherwise, of (a) the guarantor or (b) another person (including any bank under a letter of
credit) to induce the creation of which the guarantor has issued a reimbursement,
counterindemnity or similar obligation, in either case guaranteeing or having the economic
effect of guaranteeing any Financing Obligations or other obligation of any other person (the
“primary obligor”) in any manner, whether directly or indirectly, and including any obligation,
contingent or otherwise, of the guarantor, direct or indirect, (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Financing Obligations or other
obligation or to purchase (or to advance or supply funds for the purchase of) any security for
the payment of such

Schedule
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Financing Obligations or other obligation, (ii) to purchase or lease property, securities or
services for the purpose of assuring the owner of such Financing Obligations or other obligation
of the payment of such Financing Obligations or other obligation, (iii) to maintain working
capital, equity capital or any other financial statement condition or liquidity of the primary
obligor so as to enable the primary obligor to pay such Financing Obligations or other obligation,
(iv) as an account party in respect of any letter of credit or letter of guaranty issued to
support such Financing Obligations or obligation or (v) to otherwise assure or hold harmless the
owner of such Financing Obligations or other obligation against loss in respect thereof;
provided, however, that the term “Guarantee” shall not include endorsements for collection
or deposit in the ordinary course of business.

     
“Guarantee and Collateral Agreement”  shall mean the First Lien Guarantee and
Collateral Agreement in the form of Exhibit O, to be executed and delivered by Tensar Holdings,
Holdings, Tensar and each Subsidiary which provides a guarantee in respect of the Obligations or
the Lease Obligations.

     “Guarantors” shall mean Tensar Holdings, Holdings and the Subsidiary Guarantors.

     “Hazardous
Materials” shall mean any pollutant, contaminant, chemical, compound,
constituent, or hazardous, toxic or other substances, materials or wastes defined, or regulated as
such by, or pursuant to, any Environmental Law, or requires removal, remediation or reporting
under any Environmental Law, including petroleum (including crude oil or fraction thereof),
petroleum products or byproducts asbestos, or asbestos containing material, radon or other
radioactive material, polychlorinated biphenyls and urea formaldehyde insulation.

     
“Hedging Agreement” shall mean any agreement with respect to any swap, forward, future
or derivative transaction, futures or option or similar agreement
involving, or settled by
reference to, one or more rates, currencies, fuel or other commodities, equity or instruments or
securities, or economic, financial or pricing indices or measures of economic, financial or pricing
risk or value or any similar transaction or any combination of these transactions; provided,
however, that no phantom stock  or similar plan providing for payments and on account of
services provided by current or former directors, officers, employees or consultants of any Tensar
Party or any Subsidiary shall be a Hedging Agreement. For the avoidance of doubt, it is the
intention of the Tensar Parties to incur only such Hedging Agreements as are acceptable under
Islamic Shari’ah principles.

     “Holdings” shall mean The Tensar Corporation, a Delaware corporation.

     “Indemnitee” shall have the meaning assigned to such term in Section 2(b) of Schedule 6

     
“Intellectual
Property Collateral”  shall have the meaning assigned to such term in
the Guarantee and Collateral Agreement.

     
“Intellectual Property Security Agreement” shall mean all Intellectual Property
Security Agreements to be executed and delivered by the Tensar Parties, each substantially in the
applicable form required by the Guarantee and Collateral Agreement.

Schedule
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     “Intercreditor
Agreement” shall mean the Tensar Intercreditor Agreement
substantially in the form of Exhibit J.

     “Investments” shall have the meaning assigned to such term in Section 1.04 of Schedule
4.

     
 “Lease Agreement” shall mean the Lease and License Financing and Purchase Option
Agreement dated as of the Effective Date by and among Tensar Holdings, Tensar, TCO and Credit
Suisse, as administrative agent, as the same may be amended, supplemented, or modified from
time to time in accordance with the provisions thereof,

     “Lease
Documents” shall mean the Lease Agreement, the Asset Purchase Agreement, the Call
Option Letter, the Put Option Letter, the Tax Matters Agreement, the Supplemental Agreement
and the Security Documents and all other instruments, agreements and other documents
evidencing or governing the foregoing or providing for any Guarantee, Lien or other right in
respect thereof, as the same may be amended, supplemented or otherwise modified from time to
time.

     
“Lease/Purchase Facilities Documents” shall mean, collectively, the Lease
Documents and the Commodities Purchase Facility Documents.

     
“Lease Obligations” shall have the meaning assigned to such term in the
Guarantee and Collateral Agreement and the other Security Documents.

     “Leverage
Ratio” shall mean, on any date, the ratio of (a) Total Obligations on such date , to
(b) Consolidated EBITDA for the period of four consecutive fiscal quarters most recently
ended on or prior to such date, taken as one accounting period,

     “Lien” shall mean, with respect to any asset, (a) any mortgage, deed of trust, lien
(statutory or otherwise), pledge, hypothecation, encumbrance, collateral assignment, charge or
security interest in, on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any financing lease
having substantially the same economic effect as any of the foregoing) relating to such asset
and (c) in the case of securities, any purchase option, call or similar right of a third party
with respect to such securities.

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

     
“Material Adverse Effect”  shall mean a material adverse condition or material
adverse change in or materially affecting (a) the business, assets, liabilities, operations or
condition (financial or otherwise) or operating results of the Tensar Parties and the
Subsidiaries, taken as a whole, or (b) the validity or enforceability of any of the Commodities
Purchase Facility Documents or the rights and remedies of TCO or the Administrative Agent
thereunder; provided that for purposes of any representation or warranty provided by
any Tensar Party on the Effective Date, a Material Adverse Effect shall not include (A) a
downturn in general economic, business or regulatory conditions or other changes therein, (B)
effects or changes that are generally applicable to the industries and markets in which the
Tensar Parties or the Subsidiaries operate, provided that such changes do not
disproportionately affect the Tensar Parties or the

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Subsidiaries or their business, (C) changes in the United States or world financial markets, (D)
effects arising from war or terrorism or (E) effects directly or primarily arising out of the
execution or delivery of the Merger Agreement or the transactions contemplated thereby or the
public announcement thereof.

     
“Material Obligations”  shall mean (i) all Financing Obligations of Tensar with
respect to any Lease Document, any Second Lien Commodities Purchase Facility Document or any
Tensar Holdings Commodities Purchase Facility Document and (ii) all Financing Obligations (other
than the Financing Obligations described in clause (i) and the Obligations of the Tensar Parties
under the Commodities Purchase Facility Documents), or obligations in respect of one or more
Hedging Agreements, of any one or more of the Tensar Parties or the Subsidiaries in an aggregate
principal amount exceeding, in the case of clause (ii) $2,500,000. For purposes of determining
Material Obligations, the “principal amount” of the obligations of the Tensar Parties or any
Subsidiary in respect of any Hedging Agreement at any time shall be the maximum aggregate amount
(giving effect to any netting agreements) such Tensar Party or such Subsidiary would be required
to pay if such Hedging Agreement were terminated at such time.

     
“Material Subsidiary”  shall mean any Subsidiary which meets any of the following
conditions: (i) Tensar Holdings’ and its other Subsidiaries’ investments in and advances to such
Subsidiary exceed five percent of the total assets of Tensar Holdings and its Subsidiaries
consolidated as of the end of the most recently completed fiscal year; (ii) the total assets of
such Subsidiary exceed five percent of the total assets of Tensar Holdings and its Subsidiaries
consolidated as of the end of the most recently completed fiscal year; or (iii) such Subsidiary’s
income from continuing operations before income taxes, extraordinary items and cumulative effect
of a change in accounting principles of such Subsidiary exceeds five percent of such income of
Tensar Holdings and its Subsidiaries consolidated for the most recently completed fiscal year.

     “Merex
Companies” shall mean Merex E.A. Company Limited, a Taiwan company limited by shares,
and Merex Limited, a United Kingdom company.

     
“Merger Agreement”  shall mean the Agreement and Plan of Merger, dated as of September
13, 2005, by and between Tensar Holdings and Holdings.

     “Metals
Transaction” shall have the meaning assigned to such term in the Commodities Purchase
Facility Agreement or the Second Lien Commodities Purchase Agreement, as applicable.

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

     
“Mortgaged Properties” shall mean, initially, each parcel of real property and the
improvements thereto owned or leased by a Tensar Party and specified on Annex 1 (d) to this
Schedule 1, and shall include each other parcel of real property and improvements thereto with
respect to which a Mortgage is granted pursuant to Section 1.09 or 1.10 of Schedule 3.

     “Mortgages” shall mean the fee or leasehold mortgages or deeds of trust, assignments of leases
and rents and other security documents granting a Lien on any Mortgaged Property to secure the
Obligations, each in the form of Exhibit 1-1 or Exhibit 1-2, as the case may be, with

Schedule
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such changes as shall be advisable under the law of the jurisdiction in which such Mortgage is to
be recorded and as are reasonably satisfactory to TCO and the Administrative Agent, as the same may
be amended, supplemented, replaced or otherwise modified from time to time in accordance with this
Agreement.

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

     “NAG” shall mean North American Green, Inc., an Indiana corporation.

     “NAG
Sale-Leaseback” shall mean the substantially concurrent purchase by NAG of the
manufacturing facility and land located at 5315 Cynthiana Road, St. Wendell, Posey County, Indiana
(the “NAG Facility”) pursuant to the terms of the lease agreement entered into by and between Dan
Koester Properties, Inc., an Indiana corporation, and NAG dated as of September 24, 2004, and the
sale of such NAG Facility to a non-Affiliate third party and the subsequent (and substantially
concurrent) lease back from such non-Affiliate third party.

     
“Net Cash Proceeds”  shall mean (a) with respect to any Asset Sale or Recovery Event,
the proceeds thereof in the form of cash and Permitted Investments (including any such proceeds
subsequently received (as and when received) in respect of noncash consideration initially
received), net of (i) selling expenses (including reasonable and customary broker’s fees or
commissions, legal fees, transfer and similar taxes incurred by the Tensar Parties and the
Subsidiaries in connection therewith and Tensar’s good faith estimate of income taxes paid or
payable in connection with such sale, after taking into account any available tax credits or
deductions and any tax sharing arrangements), (ii) amounts provided as a reserve, in accordance
with GAAP, against any liabilities under any indemnification obligations or purchase price
adjustment associated with such Asset Sale (provided that, to the extent and at the time
any such amounts are released from such reserve, such amounts shall constitute Net Cash Proceeds)
and (iii) all payment obligations on any Financing Obligation which is secured by the asset sold
in such Asset Sale and which is required to be repaid with such proceeds (other than (x) any such
Financing Obligations assumed by the purchaser of such asset and (y) any Financing Obligations
under the Lease Documents and the Commodities Purchase Facility Documents); provided,
however, that, if (x) Tensar delivers a certificate of a Financial Officer of Tensar to TCO
and the Administrative Agent at the time of receipt thereof setting forth Tensar’s intent to
reinvest such proceeds in productive assets of a kind then used or usable in the business of
Tensar and the Subsidiaries within 180 days of receipt of such proceeds and (y) no Default or
Event of Default shall have occurred and shall be continuing at the time of such certificate or at
the proposed time of the application of such proceeds, such proceeds shall not constitute Net Cash
Proceeds except to the extent not so used at the end of such 180-day period, at which time such
proceeds shall be deemed to be Net Cash Proceeds; and (b) with respect to any issuance or
incurrence of Financing Obligations or any Equity Issuance, the cash proceeds thereof, net of all
taxes and reasonable and customary fees, commissions, costs and other expenses incurred by the
Tensar Parties and the Subsidiaries in connection therewith.

     “Netlon
License” shall mean the Consolidated Tensar License Agreement, dated June 24, 1999,
by and between the Netlon Group Limited and Tensar, relating to the manufacture, sale and use of
integral polymeric grid materials or integral polymeric mesh materials in Canada, the

Schedule
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United States, Central and South America, and all of the islands of the Caribbean Sea, as
amended,

     “Obligations” shall have the meaning assigned to the term “Working Capital Obligations” in
the Guarantee and Collateral Agreement and the other Security Documents.

     
“Patriot Act” shall mean Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism (USA Patriot Act of 2001, Title III of Pub. L.
107-56 (signed into law October 26, 2001)).

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

     
“Perfection Certificate” shall mean the Pre-Closing UCC Diligence Certificate
substantially in the form of Exhibit N or any other form approved by TCO and the Administrative
Agent.

     “Permits” shall mean any and all franchises, licenses, leases, permits, approvals,
notifications, certifications, registrations, authorizations, exemptions, qualifications,
easements, rights of way, Liens and .other rights, privileges and approvals required under any
Requirement of Law.

     
“Permitted Acquisition”  shall mean the acquisition by Tensar or any of its
Subsidiaries of all or substantially all the assets of a person or line of business of such person,
or all of the Equity Interests of a person (referred to herein as the “Acquired Entity”);
provided that (i) the Acquired Entity shall be a going concern; (ii) at the time of such
transaction (A) both before and after giving effect thereto, no Event of Default, or Default shall
have occurred and be continuing; and (B) Tensar would be in compliance with the covenants set forth
in Sections 1.11 and 1,13 of Schedule 4 and the Leverage Ratio would be at least 0,25 to 1.0 less
than the maximum Leverage . Ratio then permitted under Section 1.12 of Section 4 at such time, in
each case as of the most recently completed period ending prior to such transaction for which the
financial statements and certificates required by Sections 1.04(a) and (b) of Schedule 3 were
required to be delivered, after giving pro forma effect to such transaction and to any
other event occurring after such period as to which pro forma recalculation is appropriate
(including any other transaction described in this definition occurring after such period) as if
such transaction (and the occurrence or assumption of any Financing Obligations in connection
therewith) had occurred as of the first day of such period; and (C) after giving effect to such
acquisition, Tensar would be able to enter into a Metals Transaction pursuant to the Commodities
Purchase Facility for not less than $10,000,000; (iii) none of the Tensar Parties or the
Subsidiaries shall incur or assume any Financing Obligations in connection with such acquisition,
except as permitted by Section 1.01 of Schedule 4, and (iv) Tensar shall comply, and shall cause
the Acquired Entity to comply, with the applicable provisions of Sections 1.09 and 1.10 of Schedule
3 and the Security Documents.

     “Permitted
Holders” shall mean the Sponsor and each of the persons identified on Annex
1 (a) to this Schedule 1.

     
“Permitted Investments” shall mean:

Schedule
1, Defined Terms

14

 

     (a) direct obligations of, or obligations the principal of and interest on which are
unconditionally guaranteed by, the United States of America (or by any agency thereof to the
extent such obligations are 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;

     (b) investments in commercial paper maturing within 270 days from the date of
acquisition thereof and having, at such date of acquisition, the highest credit rating
obtainable from S&P or from Moody’s;

     (c) investments in certificates of deposit, banker’s acceptances and time deposits
maturing within 180 days from the date of acquisition thereof issued or guaranteed by or
placed with, and money market deposit accounts issued or offered by any domestic office of
Credit Suisse or any commercial bank organized under the laws of the United States of
America or any State thereof that has a combined capital and surplus and undivided profits
of not less than $500,000,000;

     (d) fully collateralized repurchase agreements with a term of not more than 30 days for
securities described in clause (a) above and entered into with a financial institution
satisfying the criteria of clause (c) above;

     (e) investments in “money market funds” within the meaning of Rule 2a-7 of the
Investment Company Act of 1940, as amended, substantially all of whose assets are invested
in investments of the type described in clauses (a) through (d) above;

     (f) other short-term investments utilized by Foreign
Subsidiaries in
accordance with normal investment practices for cash management in investments of a
type, analogous to the foregoing; and

     (g) short-term shari’ah compliant investments of a type analogous to the
foregoing and reasonably acceptable to the Administrative Agent.

     “Permitted
Lien” shall mean, with respect to Pledged Collateral, Liens created by the
Guarantee and Collateral Agreement and, with respect to all other Collateral, Liens permitted to
be prior to the Lien created by the Guarantee and Collateral Agreement by Section 1.02 of
Schedule 4.

     
“Permitted Refinancing Obligations” shall mean Financing Obligations issued or
incurred (including by means of the extension or renewal of existing Financing Obligations) to
refinance, refund, extend, renew or replace existing Financing Obligations (“Refinanced
Obligations”): provided that (a) the stated amount of such refinancing, refunding, extending,
renewing or replacing Financing Obligations is not greater than the stated amount of such
Refinanced Obligations plus the amount of any rent, profit, premiums or penalties and accrued
and unpaid amounts paid thereon and reasonable fees and expenses, in each case associated with
such refinancing, refunding, extension, renewal or replacement, (b) such refinancing,
refunding, extending, renewing or replacing Financing Obligations has a final maturity that is
no sooner than, and a weighted average life to maturity that is no shorter than, such
Refinanced Obligations, (c) if such Refinanced Obligations or any Guarantees thereof are
subordinated to the

Schedule
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Obligations, such refinancing, refunding, extending, renewing or replacing Financing Obligations
and any Guarantees thereof remain so subordinated on terms no less favorable to TCO or the
Administrative Agent, (d) the obligors in respect of such Refinanced Obligations immediately prior
to such refinancing, refunding, extending, renewing or replacing are the only obligors on such
refinancing, refunding extending, renewing or replacing Financing Obligations and (e) such
refinancing, refunding, extending, renewing or replacing Financing Obligations contains covenants
and events of default and is benefited by Guarantees, if any, which, taken as a whole, are
determined in good faith by a Financial Officer of Tensar to be no less favorable to Tensar, the
applicable Subsidiary, TCO or the Administrative Agent in any material respect than the covenants
and events of default or Guarantees, if any, in respect of such Refinanced Obligations.

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

     
“Pledged Securities”  shall have the meaning assigned to such term in the Guarantee
and Collateral Agreement.

     “Qualified
IPO” shall mean an underwritten initial public offering of common stock of (and
by) Tensar Holdings pursuant to an effective registration statement filed with the Securities and
Exchange Commission in accordance with the Securities Act of 1933, as amended, which initial
public offering results in gross cash proceeds to Tensar Holdings of $100,000,000 or more.

     “Real
Property” shall mean all Mortgaged Property and all other real property owned or leased
from time to time by the Tensar Parties and the Subsidiaries.

     “Recovery
Event” shall mean any settlement of or payment in respect of any property or
casualty insurance claim or any taking Under power of eminent domain or by condemnation or similar
proceeding of or relating to any property or asset of any Tensar Party or any Subsidiary; provided
that any such settlement or payment having a value not in excess of $250,000 and anything
constituting an Event of Loss shall be deemed not to be a “Recovery Event” for purposes of this
Agreement.

     “Regulation T” shall mean Regulation T of the Board as from time to time in effect and all
official rulings and interpretations thereunder or thereof.

     “Regulation U” shall mean Regulation U of the Board as from time to time in effect and all
official rulings and interpretations thereunder or thereof.

     “Regulation X” shall mean Regulation X of the Board as from time to time in effect and all
official rulings and interpretations thereunder or thereof.

     
“Related Financing Documents”  shall mean the Lease Documents, the Second Lien
Commodities Purchase Facility Documents and the Tensar Holdings Commodities Purchase Facility
Documents.

Schedule
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     “Related
Parties” shall mean, with respect to any specified person, such person’s
Affiliates and the respective directors, officers, employees, agents and advisors of such
person and such person’s Affiliates.

     “Release” shall mean any release, spill, seepage, emission, leaking, pumping, injection,
pouring, emptying, deposit, disposal, discharge, dispersal, dumping, escaping, leaching, or
migration into, onto or through the environment or within or upon any building, structure,
facility or fixture.

     “Rent”
shall have the meaning assigned to such term in the Lease Agreement.

     “Rental
Rate” shall have the meaning assigned to such term in the Lease Agreement.

     “Requirement of Law” shall mean as to any person, the 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 Real Property or personal property or to which such person or any of its property of
any nature is subject.

     “Responsible Officer” of any person shall mean any executive officer or 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.

     “Restricted Obligations” shall mean Financing Obligations of any Tensar Party or
any Subsidiary, the payment, prepayment, repurchase or defeasance of which is restricted under
Section 1.09(b) of Schedule 4.

     “Restricted Payment” shall mean any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests in any Tensar Party or any
Subsidiary, or any payment (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of the purchase, redemption, defeasance, retirement,
acquisition, cancellation or termination of any Equity Interests in any Tensar Party or any
Subsidiary or any option, warrant or other right to acquire any such Equity Interests in any Tensar
Party or any Subsidiary.

     “Restricted Stock Purchase Program” shall mean the Tensar Holdings, Inc. 2005
Stock Incentive Plan, and any successor plan thereto containing substantially similar terms
and provisions.

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

     “Second Lien Commodities Purchase Agreement” shall mean the Second Lien Murabaha
Agreement, dated of the Effective Date, by and between Tensar and TCO Funding Corp., as the
same may be amended, supplemented or otherwise modified in accordance with the terms hereof.

Schedule
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     “Second Lien Commodities Purchase Facility” shall mean the second lien Murabaha
facility, provided for in the Second Lien Commodities Purchase Agreement.

     “Second Lien Commodities Purchase Facility Documents” shall mean the Second Lien
Commodities Purchase Agreement and all other instruments, agreements and other documents evidencing
or governing the Second Lien Commodities Purchase Facility or providing for any Guarantee or other
right in respect thereof, as the same may be amended, supplemented or otherwise modified in
accordance with the terms hereof.

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

     “Security Documents” shall mean the Guarantee and Collateral Agreement, the
Mortgages, the Intellectual Property Security Agreements and each of the other security
agreements, pledges, mortgages, consents and other instruments and documents executed and
delivered pursuant to any of the foregoing or pursuant to Section 1.09 or 1.10 of Schedule 3.

     “Sellers” shall mean KRG Capital Partners and the other shareholders, warrant holders and
holders of stock options of Holdings immediately prior to the consummation of the Transactions.

     “Split Dollar Insurance Documents” shall mean each of the three Split Dollar
Termination Agreements, dated as of December 30, 2003, between Tensar Earth Technologies, Inc. and
Holdings, and each of Phillip D. Egan, Gale D. Sanders and Robert F. Vevoda, respectively, as in
effect on the Effective Date.

     “Sponsor” shall mean Arcapita Inc

     “subsidiary” shall mean, with respect to any. person (herein referred to as the “parent”),
any corporation, partnership, limited liability company, association or other entity (a) of which
securities or other ownership interests representing more than 50% of the equity or more than 50%
of the ordinary voting power or more than 50% of the general partnership interests are, at the
time any determination is being made, owned, controlled or held, or (b) that is, at the time any
determination is made, otherwise Controlled, in either case, by the parent or one or more
subsidiaries of the parent or by the parent and one or more subsidiaries of the parent.

     “Subsidiary” shall mean any subsidiary of Tensar Holdings unless otherwise specified.

     “Subsidiary Guarantor” shall mean, initially, each Subsidiary of Tensar specified on
Annex l(b) of this Schedule 1 and, at any time thereafter, shall include each other Subsidiary of
Tensar that is not an Excluded Foreign Subsidiary.

     “Synthetic Lease Obligations” shall mean all monetary obligations of a person under
(a) a so-called synthetic, off-balance sheet or tax retention lease or (b) an agreement for the use
or possession of any property (whether real, personal or mixed) creating obligations which do not
appear on the balance sheet of such person, but which, upon the insolvency or bankruptcy of such
person, would be characterized as Financing Obligations of such person (without regard to
accounting treatment).

Schedule
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     “Synthetic Purchase Agreement” shall mean any swap, derivative or other agreement
or combination of agreements pursuant to which any Tensar Party or any Subsidiary is or may
become obligated to make (a) any payment in connection with a purchase by any third party from a
person other than any Tensar Party or any Subsidiary of any Equity Interest or Restricted
Obligations or (b) any payment (other than on account of a purchase by it permitted hereunder of
any Equity Interest or Restricted Obligations) the amount of which is determined by reference to
the price or value at any time of any Equity Interest or Restricted Obligations;
provided that no phantom stock or similar plan providing for payments only to current or
former directors, officers or employees of any Tensar Party or the Subsidiaries (or to their
heirs or estates) shall be deemed to be a Synthetic Purchase Agreement.

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

     “Taxes” shall mean any and all present or future taxes, levies, imposts, duties,
deductions, charges, liabilities or withholdings (including interest, fines, penalties or
additions to tax) imposed by any Governmental Authority.

     “TCO” shall mean TCO Funding Corp., a Delaware corporation.

     “Tensar” shall mean The Tensar Corporation, LLC, a Georgia limited liability company.

     “Tensar Holdings” shall mean Tensar Holdings, Inc. a Delaware corporation.

     “Tensar Holdings Commodities Purchase Agreement” shall mean the Tensar Holdings
Murabaha Agreement, dated as of the Effective Date, by and between Tensar Holdings and TCH Funding
Corp., as the same may be amended, supplemented or otherwise modified
in accordance with the
terms hereof.

     “Tensar Holdings Commodities Purchase Facility” shall mean the commodities purchase
facility available to Tensar Holdings pursuant to the Tensar Holdings Commodities Purchase
Agreement.

     “Tensar Holdings Commodities Purchase Facility Documents” shall mean the Tensar
Holdings Commodities Purchase Agreement and all other instruments, agreements and other
documents evidencing or governing the Tensar Holdings Commodities Purchase Facility or providing
any right in respect thereof, as the same may be amended, supplemented or otherwise modified in
accordance with the terms hereof.

     “Tensar Holdings Subordination Agreement” shall mean the Tensar Holdings
Subordination and Intercreditor Agreement to be executed by Tensar Holdings, TCH Funding Corp.,
TCO and the other persons party thereto, on the Effective Date, substantially in the form
attached hereto as Exhibit L.

     “Tensar Parties” shall mean Tensar Holdings, Holdings, Tensar and each Subsidiary that is
or becomes a party to a Lease Document or a Commodities Purchase Facility Document.

Schedule
1, Defined Terms

19

 

     “Total Obligations” shall mean, at any time, the aggregate amount of Financing
Obligations of Tensar Holdings and its Subsidiaries outstanding at such time, in the amount that
would be reflected on a balance sheet prepared at such time on a consolidated basis in accordance
with GAAP and, without duplication and regardless of GAAP, the aggregate amount of Financing
Obligations consisting of Acquisition Cost under the Lease Documents and Murabaha Price or Unpaid
Reimbursement Obligations (in each case, excluding Agreed Profit) under the Commodities Purchase
Facility Documents and the Second Lien Commodities Purchase Facility Documents, but excluding
Financing Obligations of Tensar Holdings under the Tensar Holdings Commodities Purchase Agreement.

     “Transactions” shall mean, collectively, (a) the execution, delivery and performance by the
Tensar Parties of the Commodities Purchase Facility Documents and the Related Financing Documents
to which they are a party, (b) the granting of Liens pursuant to the Commodities Purchase Facility
Documents and the Related Financing Documents, (c) the Acquisition and the other Acquisition
Transactions and (d) any other transactions related to or entered into in connection with any of
the foregoing.

     “UCC” shall mean the Uniform Commercial Code.

     “wholly owned subsidiary” of any person shall mean a subsidiary of such person of
which securities (except for directors’ qualifying shares) or other ownership interests
representing 100% of the Equity Interests are, at the time any determination is being made, owned,
controlled or held by such person or one or more wholly owned subsidiaries of such person or by
such person and one or more wholly owned subsidiaries of such person; a “wholly owned
Subsidiary” shall mean any wholly owned subsidiary of Tensar, unless otherwise noted.

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

     2. Terms Generally. The definitions in Section 1 shall apply equally to both 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”, and words of similar import, shall not be limiting and shall be deemed
to be followed by the phrase “without limitation”. The word “will” shall be construed to have the
same meaning and effect as the word “shall”. The words “asset” and “property” shall be construed
as having the same meaning and effect and to refer to any and all rights and interests in tangible
and intangible assets and properties of any kind whatsoever, whether real, personal or mixed,
including cash, securities, Equity Interests, accounts and contract rights. 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 of this Agreement unless the context
shall otherwise require. All references herein to Articles, Sections, Exhibits and Schedules shall
be deemed references to Articles and Sections of, and Exhibits and Schedules to, this Agreement
unless the context shall otherwise require. Except as otherwise expressly provided herein, (a) any
definition of, or reference to, any Commodities Purchase Facility Document or any other agreement,
instrument or document in this Agreement shall mean such Commodities Purchase Facility Document or
other agreement, instrument or document as

Schedule
1, Defined Terms

20

 

amended, restated, supplemented or otherwise modified from time to time (subject to
any restrictions on such amendments, restatements, supplements or modifications set forth
herein) and (b) all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; provided, however, that if
Tensar notifies TCO and the Administrative Agent that Tensar wishes to amend any covenant
in Schedule 4 or any related definition to eliminate the effect of any change in GAAP
occurring after the date of this Agreement on the operation of such covenant (or if TCO or
the Administrative Agent notifies Tensar that it wishes to amend Schedule 4 or any related
definition for such purpose), then Tensar’s compliance with such covenant shall be
determined on the basis of GAAP without giving effect to the relevant change in GAAP,
until either such notice is withdrawn or such covenant is amended in a manner satisfactory
to Tensar, TCO and the Administrative Agent. For purposes of GAAP, references herein to
“Rental Rate”, “Agreed Profit” or “Financing Expense” shall be treated as interest and
“Acquisition Cost” and “Purchase Price” shall be treated as indebtedness.

     3. Pro
Forma Calculations. All pro forma calculations permitted or
required to be made by Tensar or any Subsidiary pursuant to this Agreement shall include
only those adjustments that would be permitted or required by Regulation S-X under the
Securities Act of 1933, as amended, together with those adjustments that (a) have been
certified by a Financial Officer of Tensar as having been prepared in good faith based
upon reasonable assumptions and (b) are based on reasonably detailed written assumptions
reasonably acceptable to TCO and the Administrative Agent.

     4. Shari’ah Principles. For the avoidance of doubt, although it is the
intention of the Tensar Parties not to enter into any Hedging Agreement or incur any
indebtedness, or enter into other financing transaction that is not acceptable under Islamic
Shari’ah principles, all defined terms hereunder shall include all relevant transactions of
the Tensar Parties, whether or not such transactions are found to be
Shari’ah compliant.

Schedule
1, Defined Terms

21

 

Schedule 2

REPRESENTATIONS AND WARRANTIES

 

 

Execution Copy

Schedule 2 

Representations and Warranties

     Tensar Holdings and Tensar jointly and severally represent and warrant to TCO and the
Administrative Agent that:

     SECTION
1.01. Organization; Powers. Each of Tensar Holdings and Tensar (a) is duly
organized or formed, validly existing and in good standing under the laws of the jurisdiction of
its organization or formation, (b) has all requisite power and authority, and the legal right, to
own and operate its property and assets, to lease the property it operates as lessee and to carry
on its business as now conducted and as proposed to be conducted, (c) is qualified to do business
in, and is in good standing in, every jurisdiction where such qualification is required, except
where the failure to so qualify has not had and could not reasonably be expected to have a Material
Adverse Effect, and (d) has the power and authority, and the legal right, to execute, deliver and
perform its obligations under this Agreement, each of the other Commodities Purchase Facility
Documents, the Related Financing Documents the Acquisition Documentation and each other agreement
or instrument contemplated hereby or thereby to which it is or will be a party, including, to enter
into this Agreement, to buy and sell metals and enter into the Reimbursement Letter, and to grant
the Liens contemplated to be granted by it under the Security Documents.

     SECTION 1.02. Authorization; No Conflicts. The Transactions (a) have been duly
authorized by all requisite corporate, partnership or limited liability company and, if required,
stockholder, partner or member action and (b) do not (i) violate (A) any provision of law,
statute, rule or regulation, or of the certificate or articles of incorporation or other
constitutive documents or by-laws of any Tensar Party or any Subsidiary, (B) any order of any
Governmental Authority or arbitrator or (C) any provision of any indenture, agreement or other
instrument to which any Tensar Party or any Subsidiary is a party or by which any of them or any
of their property is or may be bound, (ii) be in conflict with, result in a breach of or
constitute (alone or with notice or lapse of time or both) a default under, or give rise to any
right to accelerate or to require the prepayment, repurchase or redemption of any obligation under
any such indenture, agreement or other instrument or (iii) result in the creation or imposition of
any Lien upon or with respect to any property or assets now owned or hereafter acquired by any
Tensar Party or any Subsidiary (other than Liens created under the Security Documents or the
security documents with respect to the Lease Agreement and the Second Lien Commodities Purchase
Facility).

     SECTION 1.03. Enforceability. This Agreement has been duly executed and delivered by
each of Tensar Holdings and Tensar and constitutes, and each other Commodities Purchase Facility
Document when executed and delivered by each Tensar Party party thereto will constitute, a legal,
valid and binding obligation of such Tensar Party enforceable against such Tensar Party in
accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors’ rights generally and subject to general principles
of equity, regardless of whether considered in a proceeding in equity or at law.

Schedule 2,
Representations and Warranties

 

 

     SECTION 1.04. Governmental Approvals. No action, consent or approval of, registration
or filing with, Permit from, notice to, or any other action by, any Governmental Authority is or
will be required in connection with the Transactions, except for (a) the filing of UCC financing
statements and filings with the United States Patent and Trademark Office and the United States
Copyright Office, (b) recordation of the Mortgages and (c) such as have been made or obtained and
are in full force and effect.

     SECTION 1.05. Financial Statements. (a) Holdings has heretofore furnished to TCO and
the Administrative Agent its consolidated balance sheets and statements of income, stockholder’s
equity and cash flows as of and for the fiscal years ended December 31, 2004, December 31, 2003
and December 31, 2002, in each case audited by and accompanied by the opinion of Pricewaterhouse
Coopers LLP, independent public accountants. Such financial statements present fairly in all
material respects the financial condition and results of operations and cash flows of Holdings and
its consolidated Subsidiaries as of such dates and for such periods. Such balance sheets and the
notes thereto disclose all material liabilities, direct or contingent, of Holdings and its
consolidated Subsidiaries as of the dates thereof. Such financial statements were prepared in
accordance with GAAP applied on a consistent basis.

     (b) Tensar Holdings has heretofore delivered to TCO and the Administrative Agent its unaudited
pro forma consolidated balance sheet as of September 30, 2005, prepared giving effect to the
Transactions as if they had occurred, with respect to such balance sheet, on such date. Such pro
forma financial statements (i) have been prepared in good faith by Tensar Holdings, based on the
assumptions used to prepare the pro forma financial information contained in the Confidential
Information Memorandum (which assumptions are believed by Tensar Holdings and Tensar on the
Effective Date to be reasonable), (ii) are based on the best information available to Tensar
Holdings and Tensar after due inquiry as of the date of delivery thereof, (iii) accurately reflect
all adjustments required to be made to give effect to the Transactions and (iv) present fairly in
all material respects on a pro forma basis the estimated consolidated financial position of Tensar
Holdings and its consolidated Subsidiaries as of such date, assuming that the Transactions had
actually occurred at such date.

     (c) The projections delivered on the date hereof and attached as Annex 5 to this Schedule 2
have been prepared by Tensar Holdings in light of the past operation of its business and the
business of its subsidiaries, but including future payments of known contingent liabilities, and
reflect projections for the four-year period beginning on September 1, 2005 on a month-by-month
basis. Such projections are based upon estimates and assumptions stated therein, all of which
Tensar Holdings believes to be reasonable and fair in light of current conditions and current facts
known to it and, as of the Effective Date, reflect Tensar Holdings’ good faith and reasonable
estimates of the future financial performance of the Tensar Parties and of the other information
projected therein for the period set forth therein.

     SECTION 1.06. No Material Adverse Change. No event, change or condition has occurred
since December 31, 2004, that has caused, or could reasonably be expected to cause, a Material
Adverse Effect.

     SECTION 1.07. Title to Properties; Possession Under Leases. (a) Each of the Tensar
Parties and the Subsidiaries has good and marketable title to, or valid leasehold interests in,
all its

Schedule 2, Representations and Warranties

2

 

material properties and assets (including all Real Property), except for defects in title
that, in the aggregate, are not substantial in amount and do not materially detract from the value
of the property subject thereto or materially interfere with its ability to conduct its business as
currently conducted or to utilize such properties and assets for their intended purposes. Each
parcel of Real Property is free from material structural defects and all building systems contained
therein are in good working order and condition, ordinary wear and tear excepted, suitable for the
purposes for which they are currently being used. No material portion of the Real Property has
suffered any material damage by fire or other casualty loss that has not heretofore been materially
repaired and restored to its original condition. Each material parcel of Real Property and the
current use thereof complies in all material respects with all applicable laws (including building
and zoning ordinances and codes) and with all insurance requirements.

     (b) Each of the Tensar Parties and the Subsidiaries, and, to the knowledge of Tensar Holdings
and Tensar, each other party thereto, has complied with all material obligations under all material
leases to which it is a party and all such leases are legal, valid, binding and in full force and
effect and are enforceable in accordance with their terms. Each of the Tensar Parties and the
Subsidiaries enjoys peaceful and undisturbed possession under all such material leases. To the
knowledge of Tensar Holdings and Tensar, no landlord Lien has been filed and no material claim is
being asserted, with respect to any lease payment under any material lease. No material portion of
the Real Property is subject to any lease, sublease, license or other agreement granting to any
person (other than the Tensar Parties and their Affiliates) any right to the use, occupancy,
possession or enjoyment of such Real Property or any portion thereof. Tensar has delivered to TCO
and the Administrative Agent true, complete and correct copies of all leases (whether as landlord
or tenant) of Real Property.

     (c) None of the Tensar Parties or any of the Subsidiaries has received any notice of, nor has
any knowledge of, any pending or contemplated condemnation proceeding affecting the Real Properties
or any sale or disposition thereof in lieu of condemnation.

     (d) None
of the Tensar Parties or any of the Subsidiaries is obligated under any right of first
refusal, option or other contractual right to sell, assign or otherwise dispose of any Real
Property or any interest therein.

     (e) There are no pending or, to the knowledge of Tensar Holdings or Tensar, proposed material
special or other assessments for public improvements or otherwise affecting any material portion of
the owned Real Property, nor are there any contemplated material improvements to such owned Real
Property that may result in such special or other assessments. No Tensar Party has suffered,
permitted or initiated the joint assessment of any owned Real Property with any other real property
constituting a separate tax lot. Each owned parcel of Real Property is comprised of one or more
parcels, each of which constitutes a separate tax lot and none of which constitutes a portion of
any other tax lot.

     (f) Each Tensar Party has obtained all material permits, licenses, variances and certificates
required by applicable law to be obtained and necessary to the use and operation of each parcel of
Real Property, except where the failure to have such permit, license, certificate or variance would
not prohibit the use of such parcel of Real Property as it is currently being used. The use being
made of each parcel of Real Property materially conforms with the certificate of

Schedule 2, Representations and Warranties

3

 

occupancy and/or such other material permits, licenses, variances and certificates for such
Real Property and any other material restrictions, covenants or conditions affecting such Real
Property, except for any such nonconformity that could not reasonably be expected to be enjoined or
to result in material fines.

     (g) (i) Each parcel of Real Property has adequate rights of access to public ways to permit
the Real Property to be used for its intended purpose, and is served by installed, operating and
adequate water, electric, gas, telephone, sewer, sanitary sewer and storm drain facilities; (ii)
all public utilities necessary to the continued use and enjoyment of each parcel of Real Property
as used and enjoyed on the Effective Date are located in the public right-of-way abutting the
premises, and to the knowledge of Tensar Holdings and Tensar, all such utilities are connected so
as to serve such Real Property without passing over other property except for land of the utility
company providing such utility service or, in the case of leased Real Property, contiguous land
owned by the lessor of such leased Real Property; (iii) each parcel of Real Property, including
each leased parcel, has adequate available parking to meet legal and operating requirements; (iv)
all roads necessary for the full utilization of each parcel of Real Property for its current
purpose have been completed and dedicated to public use and accepted by all governmental
authorities or are the subject of access easements for the benefit of such Real Property; (v) no
building or structure constituting Real Property or any appurtenance thereto or equipment thereon,
or the use, operation or maintenance thereof, violates any restrictive covenant or encroaches on
any easement or on any property owned by others, which violation or encroachment interferes with
the use or could materially adversely affect the value of such building, structure or appurtenance
or which encroachment is necessary for the operation of the business at any Real Property; and
(vi) all buildings, structures, appurtenances and equipment necessary for the use of each parcel
of Real Property for the purpose for which it is currently being used are located on such real
property.

     SECTION 1.08. Subsidiaries. Annex 8 to this Schedule 2 sets forth as of the Effective
Date a list of all Subsidiaries, joint ventures and partnerships in which any Tensar Party has an
ownership interest, in each case after giving effect to the Acquisition, including each
Subsidiary, joint venture or partnership’s exact legal name (if applicable, and as reflected in
such Subsidiary, joint venture or partnership’s certificate or articles of incorporation or other
constitutive documents) and jurisdiction of incorporation or formation and the percentage
ownership interest of each Tensar Party (direct or indirect) therein, and identifies each
Subsidiary that is a Tensar Party. The shares of capital stock or other Equity Interests so
indicated on Annex 8 to this Schedule 2 are fully paid and non-assessable and are owned by the
Tensar Parties, directly or indirectly, free and clear of all Liens (other than Liens created
under the Security Documents and the security documents with respect to the Second Lien
Commodities Purchase Facility). Except as set forth on Annex 8 to this Schedule 2, there are no
outstanding rights to purchase, options, warrants or similar rights or agreements pursuant to
which any Tensar Party may be required to issue, sell, repurchase or redeem any of its Equity
Interests or the Equity Interests of any of its subsidiaries. Holdings is a wholly owned
subsidiary of Tensar Holdings and Tensar is a wholly-owned subsidiary of Holdings.

     SECTION 1.09. Litigation; Compliance with Laws. (a) There are no actions, suits or
proceedings at law or in equity or by or before any arbitrator or Governmental Authority now
pending or, to the knowledge of Tensar Holdings or Tensar threatened against or affecting any

Schedule 2, Representations and Warranties

4

 

Tensar Party or any Subsidiary or any business, property or rights of any such person (i)
that involve any Lease Document or the Transactions or (ii) except as set forth on Annex 9 to this
Schedule 2, as to which there is a reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in the aggregate, to result in
a Material Adverse Effect.

     (b) Since the date of this Agreement, there has been no change in the status of the matters
disclosed on Annex 9 to this Schedule 2 that, individually or in the aggregate, has resulted in, or
materially increased the likelihood of, a Material Adverse Effect.

     (c) Neither Tensar Holdings, Tensar nor any of the Subsidiaries or any of their respective
material properties or assets is in violation of, nor will the continued operation of their
material properties and assets as currently conducted violate, any law, rule or regulation
(including any zoning, building, Environmental Law, ordinance, code or approval or any building
permits) or any restrictions of record or agreements affecting the Mortgaged Property, or is in
default with respect to any judgment, writ, injunction, decree or order of any Governmental
Authority, where such violation or default, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect.

     SECTION 1.10. Agreements. (a) Neither Tensar Holdings, Tensar nor any of the
Subsidiaries is a party to any agreement or instrument, or subject to any corporate restriction,
that, individually or in the aggregate, has resulted or could reasonably be expected to result in
a Material Adverse Effect.

     (b) Neither Tensar Holdings, Tensar nor any of the Subsidiaries is in material default in any
manner under any provision of any material indenture or other material agreement or instrument
evidencing Material Obligations, or any other material agreement or material instrument to which
it is a party or by which it or any of its properties or assets are or may be bound. No Default
has occurred and is continuing.

     SECTION 1.11. Federal Reserve Regulations. (a) Neither Tensar Holdings, Tensar nor
any of 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.

     (b) No part of the proceeds of the Asset Purchase Agreement will be used, whether directly or
indirectly, and whether immediately, incidentally or ultimately, for purchasing or carrying Margin
Stock or for the purpose of purchasing, carrying or trading in any securities under such
circumstances as to involve Tensar in a violation of Regulation X or to involve any broker or
dealer in a violation of Regulation T. No Financing Obligations being reduced or retired out of
the proceeds of the Asset Purchase Agreement was incurred for the purpose of purchasing or
carrying any Margin Stock. Following the application of the proceeds of the Asset Purchase
Agreement, Margin Stock will not constitute more than 25% of the value of the assets of the Tensar
Parties and the Subsidiaries. None of the transactions contemplated by this Agreement will violate
or result in the violation of any of the provisions of the Regulations of the Board, including
Regulation T, U or X. If requested by TCO or the Administrative Agent, Tensar will furnish to TCO
and the Administrative Agent a statement to the foregoing effect in conformity with the
requirements of FR Form G-3 or FR Form U-1 referred to in Regulation U.

Schedule 2, Representations and Warranties

5

 

     SECTION
1.12. Investment Company Act; Public Utility Holding Company Act; Other
Restrictions. Neither Tensar Holdings, Tensar nor any of the Subsidiaries is (a) an “investment
company” as defined in, or subject to regulation under, the Investment Company Act of 1940, as
amended, (b) a “holding company” as defined in, or subject to regulation under, the Public Utility
Holding Company Act of 1935, as amended, and (c) subject to any other federal or state statute that
restricts or limits its ability in any material respect to enter into the Lease/Purchase Facilities
Documents or the Second Lien Commodities Purchase Facility Documents, or to perform its obligations
thereunder.

     SECTION 1.13. Use of Proceeds. Tensar will use the proceeds of the Asset Purchase
Agreement solely to pay the Acquisition Consideration, repay the Existing Obligations and to pay
fees and expenses related to the Transactions.

     SECTION 1.14. Tax Returns. Each of the Tensar Parties and each of the Subsidiaries
has timely filed or timely caused to be filed all Federal, state, local and foreign tax returns or
materials required to have been filed by it and all such tax returns are correct and complete in
all material respects. Each of the Tensar Parties and each of the Subsidiaries has timely paid or
timely caused to be paid all Taxes due and payable by it and all assessments received by it,
except Taxes that are being contested in good faith by appropriate proceedings and for which such
Tensar Party or such Subsidiary, as applicable, shall have set aside on its books adequate
reserves in accordance with GAAP. Each of the Tensar Parties and each of the Subsidiaries has made
adequate provision in accordance with GAAP for all Taxes not yet due and payable. No Tax Lien has
been filed, and to the knowledge of Tensar Holdings or Tensar, no claim is being asserted, with
respect to any Tax. None of the Tensar Parties or any of the Subsidiaries is aware of any facts or
events that would result in the Asset Purchase Agreement or any of the Transactions as being a
“reportable transaction” (within the meaning of Treasury Regulation Section 1.6011-4). Except as
set forth in Annex 14 to this Schedule 2, no Tensar Party has executed or filed with the Internal
Revenue Service or any other Governmental Authority any agreement or other document extending, or
having the effect of extending, the period for assessment or collection of any Taxes. None of the
Tensar Parties and their respective predecessors are liable for any Taxes: (i) under any agreement
(including any tax sharing agreements) or (ii) to the knowledge of Tensar or Tensar Holdings, as a
transferee. As of the Effective Date, no Tensar Party has agreed or been requested to make any
adjustment under Code Section 481 (a), by reason of a change in accounting method or otherwise,
which would have a Material Adverse Effect.

     SECTION 1.15. No Material Misstatements; Acquisition Documentation. (a) each of the
Tensar Parties has disclosed to TCO and the Administrative Agent all agreements, instruments and
corporate or other restrictions to which any Tensar Party or any of the Subsidiaries is subject,
and all other matters known to any of them, that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect. None of (i) the Confidential
Information Memorandum or (ii) any other information, report, financial statement, exhibit or
schedule furnished by or on behalf of any Tensar Party or any Subsidiary to TCO or the
Administrative Agent for use in connection with the transactions contemplated by the Commodities
Purchase Facility Documents (including any for use in connection with the financing obtained by
TCO) or in connection with the negotiation of any Commodities Purchase Facility Document or
included therein or delivered pursuant thereto contained, contains or will

Schedule 2, Representations and Warranties

6

 

contain any material misstatement of fact or omitted, omits or will omit to state any
material fact necessary to make the statements therein, in the light of the circumstances under
which they were, are or will be made, not misleading; provided that to the extent any such
information, report, financial statement, exhibit or schedule was based upon or constitutes a
forecast or projection, each of Tensar Holdings and Tensar represents only that it acted in good
faith and utilized reasonable assumptions and due care in the preparation of such information,
report, financial statement, exhibit or schedule.

     (b) As of the Effective Date, the representations and warranties of the applicable Tensar
Parties and their Affiliates set forth in the Acquisition Documentation are true and correct in
all material respects.

     SECTION 1.16. Employee Benefit Plans. Tensar and each of its ERISA Affiliates is in
compliance in all material respects with the applicable provisions of ERISA and the Tax Code and
the regulations and published interpretations thereunder. No ERISA Event has occurred or is
reasonably expected to occur that, when taken together with all other such ERISA Events, could
reasonably be expected to result in material liability of Tensar or any of its ERISA Affiliates.
The present value of all benefit liabilities under each Benefit Plan (based on the assumptions used
for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the last annual
valuation date applicable thereto, exceed by more than $500,000 the fair market value of the assets
of such Benefit Plan, and the present value of all benefit liabilities of all underfunded Benefit
Plans (based on the assumptions used for purposes of Statement of Financial Accounting Standards
No. 87) did not, as of the last annual valuation dates applicable thereto, exceed by more than
$500,000 the fair market value of the assets of all such underfunded Benefit Plans.

     SECTION 1.17. Environmental Matters. (a) Except as set forth in Annex 17 to this
Schedule 2, none of the Tensar Parties or any of the Subsidiaries, individually or in the
aggregate:

     (i) has failed to comply with any Environmental Law or to take, in a timely manner,
all actions necessary to obtain, maintain, renew and comply with any Environmental Permit,
and all such Environmental Permits are in full force and effect and not subject to any
administrative or judicial proceeding seeking to terminate, rescind, or modify any such
Permit except as could not that could reasonably be expected to result in a liability in
excess of $500,000 under any Environmental Law;

     (ii) has become a party to any governmental, administrative or judicial proceeding
that could reasonably be expected to result in a liability in excess of $500,000 under any
Environmental Law or has received written notice of any such proceeding that has been
threatened under Environmental Law;

     (iii) has received written notice of, become subject to, or is aware of any facts or
circumstances that could form the basis for, any Environmental Liability that could
reasonably be expected to result in a liability in excess of $500,000 other than those
which have been fully and finally resolved and for which no obligations remain outstanding;

Schedule 2, Representations and Warranties

7

 

     (iv) possesses knowledge that any Mortgaged Property (A) is subject to any Lien
or restriction on ownership, occupancy, use or transferability imposed pursuant to
Environmental Law or (B) contains or previously contained Hazardous Materials of a form or
type or in a quantity or location that could reasonably be expected to result in any
Environmental Liability in excess of $500,000;

     (v) possess knowledge that there has been a Release or threat of Release of Hazardous
Materials at or from the Mortgaged Properties (or from any facilities or other properties
formerly owned, leased or operated by any Tensar Party or any of the Subsidiaries) in
violation of, or in amounts or in a manner that could give rise to liability that could
reasonably be expected to result in a liability in excess of $500,000 under any
Environmental Law;

     (vi) has generated, treated, stored, transported, or Released Hazardous Materials from
the Mortgaged Properties (or from any other facilities or other properties currently or
formerly owned, leased or operated by any Tensar Party or any of the Subsidiaries) in
violation of, or in a manner or to a location that could give rise to liability that could
reasonably be expected to result in a liability in excess of $500,000 under any
Environmental Law;

     (vii) is aware of any facts, circumstances, conditions or occurrences in respect of any
of the facilities and properties owned, leased or operated that could reasonably be expected
to (A) form the basis of any action, suit, claim or other judicial or administrative
proceeding relating to liability in excess of $500,000 under or noncompliance with
Environmental Law on the part of any Tensar Party or any of the Subsidiaries or (B) or
interfere with or prevent continued compliance with Environmental Laws by the Tensar Parties
or the Subsidiaries; or

     (viii) has pursuant to any order, decree, judgment or agreement by which it is bound
become subject to any Environmental Liability that could reasonably be expected to result
in a liability in excess of $500,000, or has assumed any Environmental Liability for any
person that could reasonably be expected to result in a liability in excess of $500,000.

     (b) Since the date of this Agreement, there has been no change in the status of the matters
disclosed on Annex 17 to this Schedule 2 that, individually or in the aggregate, has resulted in,
or materially increased the likelihood of, a Material Adverse Effect.

     SECTION 1.18. Insurance. Annex 18 of this Schedule 2 sets forth a true, complete and
correct description of all insurance maintained by or on behalf of the Tensar Parties and the
Subsidiaries as of the Effective Date. As of the Effective Date, such insurance is in full force
and effect and all premiums have been duly paid. The Tensar Parties and the Subsidiaries are
insured by financially sound and reputable insurers and such insurance is in such amounts and
covering such risks and liabilities (and with such deductibles, retentions and exclusions) as are
in accordance with normal and prudent industry practice. None of the Tensar Parties nor any of the
Subsidiaries (a) has received written notice from any insurer (or any agent thereof) that
substantial capital improvements or other substantial expenditures will have to be made in order

Schedule 2, Representations and Warranties

8

 

to continue such insurance or (b) has any reason to believe that it will not be able to
renew its existing coverage as and when such coverage expires or to obtain similar coverage from
similar insurers at a substantially similar cost.

     SECTION 1.19. Security Documents. (a) The Guarantee and Collateral Agreement is
effective to create in favor of TCO for the benefit of TCO and the Administrative Agent, a legal,
valid, binding and enforceable security interest in the Collateral described therein and proceeds
thereof and (i) in the case of the Pledged Collateral, upon the earlier of (A) when such Pledged
Collateral is delivered to TCO and (B) when financing statements in appropriate form are filed in
the offices specified on Annex 19(a) to this Schedule 2 (as such schedule may be supplemented for
any new Subsidiary in connection with the execution of an Assumption Agreement (as defined in the
Guarantee and Collateral Agreement)) and (ii) in the case of all other Collateral described
therein (other than Intellectual Property Collateral), when financing statements in appropriate
form are filed in the offices specified on Annex 19 to this Schedule 2, the Lien created by the
Guarantee and Collateral Agreement shall constitute a fully perfected Lien on, and security
interest in, all right, title and interest of TCO in such Collateral and proceeds thereof, as
security for the Obligations, in each case prior and superior to the rights of any other person
(except for Permitted Liens).

     (b) Each Intellectual Property Security Agreement is effective to create in favor of TCO for
the benefit of TCO and the Administrative Agent, a legal, valid, binding and enforceable security
interest in the Intellectual Property Collateral described therein and proceeds thereof. When
each Intellectual Property Security Agreement is filed in the United States Patent and Trademark
Office and the United States Copyright Office, respectively, together with financing statements in
appropriate form filed in the offices specified in Annex 19(b) to this Schedule 2 and, with
respect to Intellectual Property acquired after the Effective Date, such other offices as may be
specified by Tensar in written notice to TCO and the Administrative Agent, the Lien created by such
Intellectual Property Security Agreement shall constitute a fully perfected Lien on, and security
interest in, all right, title and interest of the grantors there under in the Intellectual Property
Collateral and proceeds thereof, as security for the Obligations, in each case prior and superior
in right to any other person (except for Permitted Liens) (it being understood that subsequent
recordings in the United States Patent and Trademark Office and the United States Copyright Office
may be necessary to perfect a lien on registered trademarks, trademark applications and copyrights
acquired by the grantors after the date hereof).

     (c) Each of the Mortgages is effective to create in favor of TCO for the benefit of TCO and
the Administrative Agent, a legal, valid, binding and enforceable Lien on, and security interest
in, all of the Tensar Parties’ right, title and interest in and to the Mortgaged Property thereunder and proceeds thereof, and when the Mortgages are filed in the offices specified on Annex
19(c) to this Schedule 2 and, with respect to any Mortgage entered into after the Effective Date,
such other offices as may be specified by Tensar in written notice to TCO and the Administrative
Agent, the Lien created by each such Mortgage shall constitute a fully perfected Lien on, and
security interest in, all right, title and interest of the grantors thereof in such Mortgaged
Property and proceeds thereof, as security for the Obligations, in each case prior and superior in
right to any other person (except for Permitted Liens).

Schedule 2, Representations and Warranties

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     SECTION 1.20. Location of Real Property. Annex 20 to this Schedule 2 lists
completely and correctly as of the Effective Date all Real Property and the addresses thereof,
indicating for each parcel whether it is owned or leased, including in the case of leased Real
Property, the landlord name, lease date and lease expiration date. The Tensar Parties and the
Subsidiaries own in fee or have valid leasehold interests in, as the case may be, all the real
property set forth on Annex 20 to this Schedule 2.

     SECTION 1.21. Labor Matters. As of the Effective Date, there are no strikes, lockouts
or slowdowns against any Tensar Party or any Subsidiary pending or, to the knowledge of Tensar
Holdings or Tensar threatened in writing. The hours worked by and payments made to employees of
the Tensar 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. All
payments due from any Tensar Party or any Subsidiary, or for which any claim may be made against
any Tensar 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 such Tensar Party or
such Subsidiary. The consummation of the Transactions will not give rise to any right of
termination or right of renegotiation on the part of any union under any collective bargaining
agreement to which any Tensar Party or any Subsidiary is bound.

     SECTION 1.22. Liens. There are no Liens of any nature whatsoever on any of the
properties or assets of any Tensar Party or any of the Subsidiaries except for Liens permitted by
Section 1.02 of Schedule 4.

     SECTION 1.23. Intellectual Property. Each of the Tensar Parties and each of the
Subsidiaries owns, or is licensed to use, all trademarks, tradenames, copyrights, patents and other
intellectual property material to its business, and the use thereof by the Tensar Parties and the
Subsidiaries does not infringe upon the rights of any other person,
except for any such infringements that, individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.

     SECTION 1.24. Solvency. Immediately after the consummation of the Transactions to
occur on the Effective Date and immediately following the effectiveness of this Agreement and the
other Related Financing Documents and after giving effect to the application of the proceeds of
the Asset Purchase Agreement, (a) the fair value of the assets of each Tensar Party, at a fair
valuation, will exceed its obligations and liabilities, subordinated, contingent or otherwise; (b)
the present fair saleable value of the property of each Tensar Party will be greater than the
amount that will be required to pay the probable liability of its obligations and other
liabilities, subordinated, contingent or otherwise, as such obligations and other liabilities
become absolute and matured; (c) each Tensar Party will be able to pay its obligations and
liabilities, subordinated, contingent or otherwise, as such obligations and liabilities become
absolute and matured; and (d) no Tensar Party will have unreasonably small capital with which to
conduct the business in which it is engaged as such business is now conducted and is proposed to
be conducted following the Effective Date.

     SECTION 1.25. Acquisition Documentation. The Acquisition Documentation listed on
Annex 25 to this Schedule 2 constitutes all of the material agreements, instruments and
undertakings to which any of the Tensar Parties or any of the Subsidiaries is bound or by which

Schedule 2, Representations and Warranties

10

 

any of their respective property or assets is bound or affected relating to, or arising out
of, the Acquisition. None of such material agreements, instruments or undertakings has been
amended, supplemented or otherwise modified, and all such material agreements, instruments and
undertakings are in full force and effect. No party to any of the Acquisition Documentation is in
default thereunder of a material provision as of the Effective Date and no party thereto has the
right to terminate any of the material Acquisition Documentation.

     SECTION 1.26. Permits. (a) Each Tensar Party has obtained and holds all material
Permits required in respect of all Real Property and for any other property otherwise operated by
or on behalf of, or for the benefit of, such person and for the operation of each of its businesses
as presently conducted and as proposed to be conducted, (b) all such Permits are in full force and
effect, and each Tensar Party has performed and observed all material requirements of such Permits,
(c) no event has occurred that allows or results in, or after notice or lapse of time would allow
or result in, revocation or termination by the issuer thereof or in any other impairment of the
rights of the holder of any such Permit which revocation, termination or impairment could
reasonably be expected to have a Material Adverse Effect, (d) no such Permits contain any
restrictions, either individually or in the aggregate, that are materially burdensome to any Tensar
Party, or to the operation of any of its businesses or any property owned, leased or otherwise
operated by such person, (e) each Tensar Party reasonably believes that each of its material
Permits will be timely renewed and complied with, without material expense, and that any additional
material Permits that may be required of such person will be timely obtained and complied with,
without material expense and (f) Tensar has no knowledge or reason to believe that any Governmental
Authority is considering limiting, suspending, revoking or renewing on materially burdensome terms
any such Permit.

     SECTION
1.27, Material Contracts. The Netlon License is in full force and effect
(other than after its maturity in accordance with its terms) and, as of the Effective Date, the
Contech Agreement is in full force and effect, and the Tensar Parties are not in material breach
of their obligations under the Netlon License and, as of the Effective Date, the Contech
Agreement.

     SECTION 1.28. Status of Holdings. As of the Effective Date, Holdings has no
liabilities other than those permitted by Sections 1.01 and 1.08 of Schedule 4 to this Agreement.

     SECTION 1.29. Status of Tensar Holdings. All contracts, agreements and intellectual
property owned by Tensar Holdings as of the Effective Date are set forth on Annex 29 to this
Schedule 2. As of the Effective Date, Tensar Holdings has no liabilities other than those
permitted by Section 1.08 of Schedule 4 to this Agreement.

     SECTION 1.30. Customer Relations. Except as set forth in Annex 30 to this Schedule 2,
as of the Effective Date, there exists no actual or, to the knowledge of Tensar Holdings or
Tensar, threatened termination or cancellation of, or any material adverse modification or change
in, the business relationship of any Tensar Party with (i) any customer whose purchases during the
preceding 12 months caused them to be ranked among the five largest customers of the Tensar
Parties, taken as a whole or (ii) the counterparties to the Contech Agreement.

Schedule 2, Representations and Warranties

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     SECTION 1.31. Broker’s or Finder’s Commissions. Except as set forth on Annex 31
to this Schedule 2, no broker or finder brought about the transactions contemplated by this
Agreement, the Lease Agreement or the Second Lien Commodities Purchase Agreement or the Acquisition
Transactions, and none of Tensar Holdings, any other Tensar Party or Affiliate thereof has any
obligation to any person in respect of any finder’s or brokerage fees in connection therewith.

     SECTION 1.32. Patriot Act, Etc.

          To the extent applicable, each Tensar Party is in compliance, in all material respects, with
the (i) Trading with the Enemy Act, as amended, and each of the foreign assets control regulations
of the Untied States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any other
enabling legislation or executive order relating thereto, and (ii) the Patriot Act.

Schedule 2, Representations and Warranties

12

 

Schedule 3 

AFFIRMATIVE COVENANTS

 

 

Execution Copy

Schedule 3

Affirmative Covenants

     Each of Tensar Holdings and Tensar covenants and agrees with TCO and the Administrative
Agent that so long as this Agreement shall remain in effect and until all Obligations shall have
been paid in full and this Agreement has been terminated, each of Tensar Holdings and Tensar
will, and will cause each of the Subsidiaries to:

     SECTION
1.01. Existence; Businesses and Properties. (a) Do or cause to be done all
things necessary to preserve, renew and keep in full force and effect its legal existence,
except as otherwise expressly permitted under Section 1.05 of Schedule 4.

     (b) Do or cause to be done all things necessary to obtain, preserve, renew, extend and keep in
full force and effect the rights, licenses, permits, franchises, authorizations, patents,
copyrights, trademarks and trade names material to the conduct of its business; maintain and
operate such business in substantially the manner in which it is presently conducted and operated;
comply in all material respects with all applicable laws, rules, regulations and decrees and orders
of any Governmental Authority, whether now in effect or hereafter enacted; comply with the terms
of, and enforce its rights under, each material lease of real property and each other material
agreement so as to not permit any material uncured default on its part to exist thereunder, except
as otherwise expressly permitted under Section 1.05 of Schedule 4; and at all times maintain and
preserve all property material to the conduct of such business and keep such property in good
repair, working order and condition and subject to Section 10 of the Lease Agreement, from time to
time make, or cause to be made, all needful and proper repairs, renewals, additions, improvements
and replacements thereto necessary in order that the business carried on in connection therewith
may be properly conducted at all times.

     SECTION 1.02. Insurance. Subject to Section 15 of the Lease Agreement, keep its
insurable properties adequately insured at all times by financially sound and reputable
insurers; maintain such other insurance, to such extent and against such risks (and with such
deductibles, retentions and exclusions), including fire and other risks insured against by
extended coverage, as is customary for companies in the same or similar businesses operating in
the same or similar locations, including public liability insurance against claims for personal
injury or death or property damage occurring upon, in, about or in connection with the use of
any properties owned, occupied or controlled by it; maintain such other insurance as may be
required by law; and maintain such other insurance as otherwise required by the Security
Documents (and comply with all covenants in the Security Documents with respect thereto).

     SECTION 1.03. Obligations and Taxes. Pay its Financing Obligations and other
obligations promptly and in accordance with their terms and pay and discharge promptly when due
all Taxes imposed upon it or upon its income or profits or in respect of its property, before
the same shall become delinquent or in default, as well as all lawful claims for labor,
materials and supplies or otherwise that, if unpaid, might give rise to a Lien upon such
properties or any part thereof; provided, however, that such payment and discharge shall
not be required with respect to any such Tax so long as the validity or amount thereof shall be
contested in good faith

Schedule 3, Affirmative Covenants

 

 

by appropriate proceedings and Tensar Holdings, Tensar or the applicable Subsidiary shall
have set aside on its books adequate reserves with respect thereto in accordance with GAAP and such
contest operates to suspend collection of the contested obligation, tax, assessment or charge and
enforcement of a Lien and, in the case of a Mortgaged Property, there is no risk of forfeiture of
such property. In addition, none of the Tensar Parties or any of the Subsidiaries shall treat the
Asset Purchase Agreement or any of the Transactions as being a “reportable transaction” (within the
meaning of Treasury Regulation Section 1.6011-4).

     SECTION 1.04. Financial Statements, Reports, etc. In the case of Tensar Holdings,
furnish to TCO and the Administrative Agent:

     (a) within 90 days after the end of each fiscal year, its consolidated balance sheet
and related statements of income, stockholders’ equity and cash flows showing the financial
condition of Tensar Holdings and its consolidated subsidiaries as of the close of such
fiscal year and the results of its operations and the operations of such subsidiaries during
such year, together with comparative figures for the immediately preceding fiscal year,
all audited by Pricewaterhouse Coopers LLP or other independent public accountants of
recognized national standing and accompanied by an opinion of such accountants (which shall
not be qualified in any material respect) to the effect that such consolidated financial
statements fairly present in all material respects the financial condition and results of
operations of Tensar Holdings and its consolidated Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied, together with all information for the final month
of such fiscal year set forth in Section 1.04(c) of this Schedule 3;

     (b) within:45 days after the end of each of the first three fiscal quarters
of each fiscal year, its consolidated balance sheet and related statements of income,
stockholders’ equity and cash flows showing the financial condition of Tensar Holdings and
its consolidated subsidiaries as of the close of such fiscal quarter and the results of its
operations and the operations of such subsidiaries during such fiscal quarter and the then
elapsed portion of the fiscal year, and comparative figures for the same periods in the
immediately preceding fiscal year, all certified by one of its Financial Officers as fairly
presenting in all material respects the financial condition and results of operations of
Tensar Holdings and its consolidated subsidiaries on a consolidated basis in accordance with
GAAP consistently applied, subject to normal year-end audit adjustments and the absence of
footnotes, together with all information for the final month of such fiscal quarter set
forth in Section 1.04(c) of this Schedule 3;

     (c) within 30 days after the end of the first two fiscal months of each fiscal quarter,
its consolidated balance sheet and related statements of income and cash flows showing the
financial condition of Tensar Holdings and its consolidated subsidiaries during such fiscal
month and the then elapsed portion of the fiscal year, all certified by one of its Financial
Officers as fairly presenting in all material respects, the financial condition and results
of operations of Tensar Holdings and its consolidated subsidiaries on a consolidated basis
in accordance with GAAP consistently applied, subject to normal year-end audit adjustments
and the absence of footnotes, together with management’s discussion and analysis with
respect to such financial statements;

Schedule 3, Affirmative Covenants

2

 

     (d) concurrently with any delivery of financial statements under clause (a) or
(b) above, a certificate of the accounting firm (in the case of clause (a)) or Financial
Officer (in the case of clause (b)) opining on or certifying such statements (which
certificate, when furnished by an accounting firm, may be limited to accounting matters and
disclaim responsibility for legal interpretations) (i) certifying that no Event of Default
or Default has occurred and is continuing or, if such an Event of Default or Default has
occurred and is continuing, specifying the nature and extent thereof and any corrective
action taken or proposed to be taken with respect thereto and (ii) setting forth
computations in reasonable detail satisfactory to TCO and the Administrative Agent
demonstrating compliance with the covenants contained in Sections 1.11, 1.12. 1.13 and 1.14
of Schedule 4 and, in the case of a certificate delivered with the financial statements
required by clause (a) above, setting forth Tensar Holdings’ calculation of Excess Cash
Flow;

     (e) Not more than 30 days after the end of each fiscal year of Tensar Holdings, a
detailed consolidated budget for the current fiscal year (including a projected consolidated
balance sheet and related statements of projected operations and cash flows as of the end of
and for such following fiscal year and setting forth the assumptions used for purposes of
preparing such budget) and, promptly when available, any significant revisions of such
budget;

     (f) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by Tensar Holdings,
Tensar or any Subsidiary with the Securities and Exchange Commission, or any Governmental
Authority succeeding to any or all of the functions of said Commission, or with any national
securities exchange, or distributed to its shareholders, as the case may be;

     (g) promptly after the receipt thereof by Tensar Holdings, Tensar or any of the
Subsidiaries, a copy of any “management letter” (whether in final or draft form) received
by any such person from its certified public accountants and the management’s response
thereto; and

     (h) promptly, from time to time, such other information regarding the operations,
business affairs and financial condition of Tensar Holdings, Tensar or any Subsidiary, or
compliance with the terms of any Lease/Purchase Facilities Document, as TCO or the
Administrative Agent may reasonably request.

     SECTION 1.05. Litigation and Other Notices. Furnish to TCO and the Administrative
Agent prompt written notice of the following:

     (a) any Event of Default or Default, specifying the nature and extent thereof and the
corrective action (if any) taken or proposed to be taken with respect thereto;

     (b) the filing or commencement of, or any written threat or written 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 arbitrator or Governmental Authority, against any

Schedule 3, Affirmative Covenants

3

 

Tensar Party or any Subsidiary that could reasonably be expected to result in a
Material Adverse Effect;

     (c) the occurrence of any ERISA Event described in clause (b) of the definition thereof
or any other ERISA Event that, alone or together with any other ERISA Events that have
occurred, could reasonably be expected to result in liability of the Tensar Parties and the
Subsidiaries in an aggregate amount exceeding $500,000;

     (d) any of the following environmental matters, specifying the nature and extent
thereof and the proposed response thereto, (1) any violation of Environmental Law, or
Release or threatened Release of Hazardous Materials, that could reasonably be expected to
require remedial action or give rise to Environmental Liability in excess of $500,000, (2)
any remedial action taken by any Tensar Party or its Subsidiaries or any other person in
response to any Release or threatened Release of Hazardous Materials that could reasonably
be expected to result in Environmental Liability in excess of $500,000, (3) any actions or
proceedings relating to any Environmental Liability (including any requests for information
by a Governmental Authority) that could reasonably be expected to be in excess of $500,000,
and (4) any Tensar Party’s or any Subsidiaries’ discovery of any occurrence or condition at
any Mortgaged Property, or on any adjoining or proximate real property, that could cause
such Mortgaged Property or any part thereof to be subject to any material restrictions on
the ownership, occupancy, transferability or use thereof under any Environmental Law;

     (e) any Asset Sale, Equity Issuance or incurrence of Financing Obligations not
otherwise permitted by Section 1.01 of Schedule 4; and

     (f) any development that has resulted in, or could reasonably be expected to result in,
a Material Adverse Effect.

     SECTION 1.06. Information Regarding Collateral. (a) Furnish to TCO and the
Administrative Agent prompt written notice of any change (i) in any Tensar Party’s corporate name
or in any trade name used to identify it in the conduct of its business or in the ownership of its
properties, (ii) in the location of any Tensar Party’s chief executive office, its principal place
of business, any office in which it maintains books or records relating to Collateral owned by it
or any office or facility at which Collateral owned by it is located (including the establishment
of any such new office or facility), (iii) in any Tensar Party’s identity or corporate structure
or (iv) in any Tensar Party’s Federal Taxpayer Identification Number. Each of Tensar Holdings and
Tensar agree not to effect or permit any change referred to in the preceding sentence unless all
filings have been made under the UCC or otherwise and all other actions have been taken that are
required in order for TCO to continue at all times following such change to have a valid, legal
and perfected security interest in all the Collateral. Each of Tensar Holdings and Tensar also
agrees promptly to notify TCO and the Administrative Agent if any material portion of the
Collateral is damaged or destroyed.

     (b) In the case of Tensar Holdings, each year, at the time of delivery of the annual
financial statements with respect to the preceding fiscal year pursuant to Section 1.04(a) of this
Schedule 3, deliver to TCO and the Administrative Agent a certificate of a Financial Officer

Schedule 3, Affirmative Covenants

4

 

setting forth the information required by the Perfection Certificate or confirming
that there has been no change in such information since the date of the Perfection
Certificate delivered on the Effective Date or the date of the most recent Perfection
Certificate delivered pursuant to this Section.

     SECTION 1.07. Maintaining Records; Access to Properties and Inspections;
Environmental Assessments. (a) Keep proper books of record and account in which full,
true and correct entries in conformity with GAAP and all requirements of law are made of
all dealings and transactions in relation to its business and activities. Each of Tensar
Holdings and Tensar will, and will cause each of its subsidiaries to, permit any
representatives designated by TCO or the Administrative Agent to visit and inspect the
financial records and the properties of Tensar Holdings or Tensar, as the case may be, or
any of its subsidiaries at reasonable times and as often as reasonably requested and to
make extracts from and copies of such financial records, and permit any such
representatives designated by TCO or the Administrative Agent to discuss the affairs,
finances and condition of the Tensar Parties, as the case may be, or any of its
subsidiaries with the officers thereof and independent accountants therefor.

     (b) At its election, TCO or the Administrative Agent may, at its own cost and
expense, retain an independent engineer or environmental consultant to
conduct an environmental assessment of the condition of any Mortgaged Property or
facility of any Tensar Party or of any Tensar Party’s compliance with Environmental Law.
Each of Tensar Holdings and Tensar shall, and shall cause each of the Subsidiaries to,
cooperate in the performance of any such environmental assessment and permit any such
engineer or consultant designated by TCO or the Administrative Agent to have full access
to each property or facility at reasonable times and after reasonable notice to Tensar
Holdings and Tensar of the plans to conduct such an environmental assessment.
Environmental assessments conducted under this clause (b) shall be limited to visual
inspections of the Mortgaged Property or facility, interviews with representatives of the
Tensar Parties or facility personnel, and review of applicable records and
documents pertaining to the property or facility, its compliance with Environmental Law
and any potential Environmental Liabilities.

     (c) In the event that TCO or the Administrative Agent reasonably believe that (i)
Hazardous Materials have been Released or are threatened to be Released on or from any
Mortgaged Property or other facility of Tensar Holdings, Tensar or the Subsidiaries or
(ii) that any such property or facility is not being operated in material compliance with
applicable Environmental Law; TCO may or the Administrative Agent, at its election and
after reasonable notice to Tensar, retain an independent engineer or other qualified
environmental consultant to evaluate whether Hazardous Materials are present in the soil,
groundwater, or surface water at such Mortgaged Property or facility or whether the
facilities or properties are being operated and maintained in material compliance with
applicable Environmental Laws. Such environmental assessments may include detailed
visual inspections of the Mortgaged Property or facility, including any and all storage
areas, storage tanks, drains, dry wells and leaching areas, and the taking of soil
samples, surface water samples and groundwater samples as well as such other reasonable
investigations or analyses as are necessary. The scope of any such environmental
assessments under this Section 1.07(c) of this Schedule 3 shall be determined
in the commercially reasonable discretion of TCO and the Administrative Agent. Each of
Tensar Holdings and Tensar shall, and shall cause each of the Subsidiaries to,
cooperate in the

Schedule 3, Affirmative Covenants

5

 

performance of any such environmental assessment and permit any such engineer or
consultant designated by TCO or the Administrative Agent to have full access to each
property or facility at reasonable times and after reasonable notice to Tensar of the
plans to conduct such an environmental assessment. All environmental assessments
conducted pursuant to this Section 1.07(c) of this Schedule 3 shall be at Tensar’s sole
cost and expense.

     SECTION 1.08. Use of Proceeds. Use the proceeds of the Asset Purchase
Agreement only for the purposes set forth in Section 1.13 of Schedule 2.

     SECTION
1.09. Additional Collateral, etc. (a) With respect to any
Collateral acquired after the Effective Date or, in the case of inventory or equipment,
any material Collateral moved after the Effective Date by any Tensar Party (other than
any Collateral described in clauses (b), (c) or (d) of this Section) as to which TCO
does not have a first priority perfected security interest, promptly (and, in any event,
within 10 days following the date of such acquisition) (i) execute and deliver to TCO
and the Administrative Agent such amendments to the Guarantee and Collateral Agreement
or such other Security Documents as TCO or the Administrative Agent deems necessary or
advisable to grant to TCO a security interest in such Collateral and (ii) take all
actions necessary or advisable to grant to, or continue on behalf of, TCO, a perfected
first priority security interest in such Collateral, including entering into landlord
waivers and the filing of UCC financing statements in such jurisdictions as may be
required by the Guarantee and Collateral Agreement or by law or as may be reasonably
requested by TCO or the Administrative Agent.

     (b) With respect to any fee interest in any Collateral consisting of Real Property
or any lease interest in Collateral consisting of Real Property with an annual
rent in excess of $1,000,000 acquired or leased after the Effective Date by any
Tensar Party, promptly (and, in any event, within 20 days following the date
of such acquisition) (i) execute and deliver a first priority Mortgage in
favor.of TCO covering such real property and complying with the
provisions herein and
in the Security Documents, (ii) provide the Secured Parties with title and extended
coverage insurance in an amount at least equal to the purchase price of such Real
Property (or such other amount as TCO or the Administrative Agent shall reasonably
specify), Surveys, and if applicable, flood insurance, lease estoppel certificates,
memoranda or amendments, all in accordance with the standards for deliveries contemplated
on the Effective Date, as described in Annex 9 to this Schedule 3, (iii) deliver to TCO
and the Administrative Agent legal opinions relating to the matters described above,
which opinions shall be in form and substance, and from counsel, reasonably satisfactory
to TCO and the Administrative Agent and (iv) deliver to TCO and the Administrative Agent
a notice identifying, and upon TCO’s or the Administrative Agent request, provide a copy
of, the consultant’s reports, environmental site assessments or other documents relied
upon by any Tensar Party to determine that any Real Property included in such Collateral
does not contain Hazardous Materials of a form or type or in a quantity or location that
could reasonably be expected to result in a material Environmental Liability or otherwise
cause any of the representatives or warranties contained in Section 1.17 of Schedule 2 to
be untrue.

     (c) With respect to any Subsidiary (other than an Excluded Foreign Subsidiary)
created or acquired after the Effective Date (which, for the purposes of this clause (c),
shall include any existing Subsidiary that ceases to be an Excluded Foreign Subsidiary at
any time

Schedule 3, Affirmative Covenants

6

 

after the Effective Date) by Tensar Holdings, Tensar or any of the Subsidiaries, promptly
(and, in any event, within 10 days following such creation or the date of such
acquisition) (i) execute and deliver to TCO such amendments to the Guarantee and
Collateral Agreement as TCO or the Administrative Agent deem necessary or advisable to
grant to TCO a valid, perfected first priority security interest in the Equity
Interests in such new Subsidiary that are owned by any Tensar Party, (ii) deliver to
TCO the certificates, if any, representing such Equity Interests, together with undated
stock powers, in blank, executed and delivered by a duly authorized officer of such
Tensar Party, as the case may be, (iii) cause such new Subsidiary (A) to become a party
to the Guarantee and Collateral Agreement (and provide Guarantees of the Obligations) and
an Intellectual Property Security Agreement and (B) to take such actions necessary or, in the
reasonable opinion of TCO or the Administrative Agent, advisable to grant to TCO a
perfected first priority security interest in the Collateral described in the Guarantee
and Collateral Agreement and such Intellectual Property Security Agreement with respect
to such new Subsidiary, including the recording of instruments in the United States
Patent and Trademark Office and the United States Copyright Office and the filing of
UCC financing statements in such jurisdictions as may be required by the Guarantee and
Collateral Agreement, such Intellectual Property Security Agreement or by law or as
may be reasonably requested by TCO, (iv) deliver to TCO and the Administrative Agent
legal opinions relating to the matters described above, which opinions shall be in form
and substance, and from counsel, reasonably satisfactory to TCO and the Administrative
Agent, and (v) deliver to TCO and the Administrative Agent a notice identifying, and
upon TCO’s or the Administrative Agent’s request, provide a copy of, the consultant’s
reports, environmental site assessments or other documents relied upon by any Tensar
Party to determine that any such real property owned by such Tensar Party does not
contain Hazardous Materials of a form or type or in a quantity or location that could
reasonably be expected to result in a material Environmental Liability or that
acquisition of such Subsidiary will not cause any of the representations and.
warranties contained in Section 1.17 of Schedule 2 to be untrue.

     (d) With respect to any Excluded Foreign Subsidiary created or acquired after the ‘
Effective Date by Tensar Holdings or any of its Domestic Subsidiaries, promptly (and, in any
event, within 10 days following such creation or the date of such acquisition) (i) execute and
deliver to TCO and the Administrative Agent such amendments to the Guarantee and Collateral
Agreement as TCO or the Administrative Agent deems necessary or advisable in order to grant to
TCO a perfected first priority security interest in the Equity Interests in such new Excluded
Foreign Subsidiary that is owned by any Tensar Party (provided that in no event shall 66-2/3%
or more of the total outstanding voting Equity Interests in any such new Excluded Foreign
Subsidiary be required to be so pledged), (ii) deliver to TCO the certificates representing
such Equity Interests, together with undated stock powers, in blank, executed and delivered by
a duly authorized officer of such Tensar Party and take such other action as may be necessary
or, in the reasonable opinion of TCO or the Administrative Agent, desirable to perfect the
security interest of TCO thereon, (iii) deliver to TCO and the Administrative Agent legal
opinions relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to TCO and the Administrative Agent, and
(iv) deliver to TCO and the Administrative Agent a notice identifying, and upon TCO’s or the
Administrative Agent’s request, provide a copy of, the consultant’s reports, environmental site
assessments or other documents relied upon by the Tensar or any other Tensar Party to determine
that any real property owned by such Subsidiary does not contain Hazardous Materials of a form
or type or in

Schedule 3, Affirmative Covenants

7

 

a quantity or location that could reasonably be expected to result in a material
Environmental Liability or that acquisition of such Subsidiary will not cause any of the
representations and warranties contained in Section 1.17 of
Schedule 2 to be untrue.

     SECTION 1.10. Further Assurances. From time to time duly authorize, execute and
deliver, or cause to be duly authorized, executed and delivered, such additional instruments,
certificates, financing statements, agreements or documents, and take all such actions (including
filing UCC and other financing statements), as TCO or the Administrative Agent may reasonably
request, for the purposes of implementing or effectuating the provisions of this Agreement and the
other Lease Documents, or of more fully perfecting or renewing the rights of TCO with respect to
the Collateral (or with respect to any additions thereto or replacements or proceeds or products
thereof or with respect to any other property or assets hereafter acquired by Tensar Holdings,
Tensar or any Subsidiary which may be deemed to be part of the Collateral) pursuant hereto or
thereto. Upon the exercise by TCO or the Administrative Agent of any power, right, privilege or
remedy pursuant to this Agreement or the other Lease Documents which requires any consent,
approval, recording, qualification or authorization of any Governmental Authority, each of Tensar
Holdings and Tensar will execute and deliver, or will cause the execution and delivery of, all
applications, certifications, instruments and other documents and papers that TCO or the
Administrative Agent may be required to obtain from either Tensar Holdings, Tensar or any of the
Subsidiaries for such governmental consent, approval, recording, qualification or authorization.

     SECTION 1.11. Rent and Profit Limitation. Tensar shall ensure that, within 90 days
following the Effective Date, and for at least three years following the Effective Date, no less
than 50% of Tensar’s Financing Obligations set forth in the Lease, the Commodities Purchase
Agreement and the Second Lien Commodities Purchase Agreement effectively bears a fixed rental or
profit rate.

     SECTION 1.12. Landlord and Storage Agreements. Provide TCO with copies of all
agreements not previously provided or made available to TCO between each Tensar Party and any
landlord or warehouseman which owns any premises at which any inventory may, from time to time, be
kept.

     SECTION 1.13. Compliance with Laws. Comply with all federal, state, local and foreign
laws and regulations applicable to it, including Executive Order No. 13224 and the Patriot Act and
those laws and regulations relating to ERISA and labor matters and Environmental Laws and
Environmental Permits, except to the extent that the failure to comply, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.

     SECTION 1.14. Netlon License. Maintain at all times the Netlon License in full force
and effect.

     SECTION 1.15. Patriot Act, Etc. Provide all documentation and other information
required by TCO to satisfy its obligations with respect under “know your customer” and anti-money
laundering rules and regulations, including without limitation the Patriot Act and any other
similar law, rule or regulation of any relevant jurisdiction to the extent requested by TCO

Schedule 3, Affirmative Covenants

8

 

or the Administrative Agent. No part of the proceeds from the Asset Purchase Agreement
or any proceeds from the sale of Metals or Goods will be used, directly or indirectly, for
any payments to any governmental official or employee, political party, official of a
political party, candidate for political office, or anyone else acting in an official
capacity, in order to obtain, retain or direct business or obtain any improper advantage, in
violation of the United States Foreign Corrupt Practices Act of 1977, as amended.

     SECTION 1.16. Post Closing Obligations. Take the actions required to be taken on
Annex 16 of this Schedule 3 within the time frames set forth therein, including any extensions
permitted thereunder.

Schedule 3, Affirmative Covenants

9

 

SCHEDULE 3: AFFIRMATIVE COVENANTS

TABLE OF ANNEXES

Annex 9: Standards for Delivery

 

 

SCHEDULE 3 

ANNEX 9: STANDARDS FOR DELIVERY

     The Administrative Agent shall receive in respect of each Mortgaged Property a mortgagee’s
title insurance policy (or policies) or marked up unconditional binder for such insurance. Each
such policy shall (i) be in an amount satisfactory to the Administrative Agent; (ii) be issued at
ordinary rates; (iii) insure that the Mortgage insured thereby creates a valid first Lien on, and
security interest in, such Mortgaged Property free and clear of all defects and encumbrances,
except as disclosed therein; (iv) name (a) TCO Funding Corp. in its capacity as a party to the
Lease Agreement and the Commodities Purchase Agreement, with an endorsement in favor of the
Administrative Agent or (b) the Administrative Agent, in each case in form and substance as
reasonably satisfactory to the Administrative Agent, as the insured thereunder and; (v) be in the
form of ALTA Loan Policy — 1970 Form B (Amended 10/17/70 and 10/17/84) (or equivalent policies), if
available; (vi) contain such endorsements and affirmative coverage as the Administrative Agent may
reasonably request in form and substance acceptable to the Administrative Agent, including (to the
extent applicable with respect to such Mortgaged Property and available in the jurisdiction in
which such Mortgaged Property is located), the following endorsements: variable rate; survey;
comprehensive; zoning (ALTA 3.1 with parking added); first loss, last dollar and tie-in; access;
separate tax parcel; usury; doing business; subdivision; environmental protection lien; CLTA 119.2
and CLTA 119.3 (for leased Mortgaged Property, only); contiguity; and such other endorsements as
the Administrative Agent shall reasonably require in order to provide insurance against specific
risks identified by the Administrative Agent in connection with such Mortgaged Property; and (vii)
be issued by title companies satisfactory to the Administrative Agent (including any such title
companies acting as co-insurers or reinsurers, at the option of the Administrative Agent) (in each
such case, a “Title Insurance Company”). The Administrative Agent shall have received evidence
satisfactory to it that all premiums in respect of each such policy, all charges for mortgage
recording tax, and all related expenses, if any, have been paid. The Administrative Agent shall
have received a copy of all recorded documents referred to, or listed as exceptions to title in,
the title policy or policies referred to above and a copy of all other material documents affecting
the Mortgaged Property.

     If requested by the Administrative Agent, the Administrative Agent shall receive (i) a
policy of flood insurance that (A) covers any parcel of improved Mortgaged Property that is
located in a flood zone, (B) is written in an amount not less than the outstanding principal
amount of the financing obligations secured by such Mortgage that is reasonably allocable to
such Mortgaged Property or the maximum limit of coverage made available with respect to the
particular type of property under the National Flood Insurance Act of 1968, whichever is less,
and (C) has a term ending not later than the Final Rent Paymentand (ii) confirmation that
Tensar has received the notice required pursuant to Section 208(e)(3) of Regulation H of the
Board of Governors of the Federal Reserve System.

 

 

     The Administrative Agent and the Title Insurance Company shall receive maps or plans of an
as-built survey (in each case, a “Survey”) of the sites of the owned Mortgaged Property intended to
be subject to a Mortgage under the Lease/Purchase Facilities Documents certified to the
Administrative Agent and the Title Insurance Company in a manner satisfactory to them, dated not
more than 2 years prior to the delivery of the Mortgage by an independent professional licensed
land surveyor satisfactory to the Administrative Agent and the Title Insurance Company, which maps
or plans and the surveys on which they are based shall be made in accordance with the Minimum
Standard Detail Requirements for Land Title Surveys jointly established and adopted by the American
Land Title Association and the American Congress on Surveying and Mapping in 1997 or 1999 and
meeting the accuracy requirements as defined therein. Without limiting the generality of the
foregoing, each Survey shall (i) be a current “as-built” survey showing the location of any
adjoining streets (including their widths and any pavement or other improvements), easements
(including the recorded information with respect to all recorded instruments), the mean high water
base line or other legal boundary lines of any adjoining bodies of water, fences, zoning or
restriction setback lines, rights-of-way, utility lines to the points of connection and any
encroachments; (ii) locate all means of ingress and egress, certifying the amount of acreage and
square footage, indicate the address of the Mortgaged Property, contain the legal description of
the Mortgaged Property, and also contain a location sketch of the Mortgaged Property; (iii) show
the location of all improvements as constructed on the Mortgaged Property, all of which shall be
within the boundary lines of the Mortgaged Property and conform to all applicable zoning
ordinances, set-back lines and restrictions; (iv) indicate the location of any improvements on the
Mortgaged Property with the dimensions in relations to the lot and building lines; (v) show
measured distances from the improvements to be set back and specified distances from street or
Mortgaged Property lines in the event that deed restrictions, recorded plats or zoning ordinances
require same; (vi) designate all courses and distances referred to in the legal description, and
indicate the names of all adjoining owners on all sides of the Mortgaged Property, to the extent
available; and (vii) indicate the flood zone designation, if any, in which the Mortgaged Property
is located. The legal description of the applicable Mortgaged Property shall be shown on the face
of each survey or affixed thereto, and the same shall conform to the legal description contained in
the title policy described above.

 

 

Annex 16 of Schedule 3

Post-Closing Covenant

Tensar shall deliver within the time period specified below or such additional period of time as
may be agreed to by the Administrative Agent:

     1. within fourteen (14) days following the Effective Date (or such
additional fourteen (14) days as may be agreed to by the Administrative Agent) Tensar
shall cause to be delivered with respect to the leased real estate assets Landlord
Consent and Waivers in form and substance satisfactory to the Administrative Agent
for the property located at 5883 Glenridge Drive, Suite 200 Atlanta, GA 30328 with
CEP Plaza Partners, LLC, as lessor and Tensar Earth Technologies, Inc. as lessee;

     2. within fourteen (14) days following the Effective Date (or
such additional fourteen (14) days as may be agreed to by the Administrative Agent)
Tensar shall deliver an executed deposit account control agreement in a form
reasonably satisfactory to the Administrative Agent with respect to the bank accounts
at Wachovia, N.A.;

     3. within fourteen (14) days following the Effective Date (or such
additional fourteen (14) days as may be agreed to by the Administrative Agent) Tensar
shall cause to be delivered insurance endorsements corresponding to the insurance
certificates delivered on the Effective Date; provided, however, with respect
to insurance endorsements required for North American Green, Inc., Tensar shall
cause such endorsements to be delivered within forty (40) days following the
Effective Date (or such additional fourteen (14) days as may be agreed to by the
Administrative Agent);

     4. within thirty (30) days following the Effective Date (or such additional
thirty (30) days as may be agreed to by the Administrative Agent) Tensar shall
deliver executed intellectual property releases and assignments as previously
disclosed in writing by the Administrative Agent; and

     5. within fourteen (14) days following the Effective Date (or such additional fourteen (14)
days as may be agreed to by the Administrative Agent) Tensar shall deliver evidence that it has
filed a name change form with the U.S. Patent and Trademark Office and the U.S. Copyright Office.

 

 

Schedule 4

NEGATIVE COVENANTS

 

 

Execution Copy

Schedule 4 

Negative Covenants

     Each of Tensar Holdings and Tensar covenants and agrees with TCO and the Administrative Agent
that, so long as this Agreement shall remain in effect and until all Obligations have been paid in
full and this Agreement has been terminated, neither Tensar Holdings nor Tensar will, nor will it
cause or permit any of the Subsidiaries to:

     SECTION
1.01. Financing Obligations. Incur, create, assume or permit to exist any
Financing Obligations, or make or permit any amounts to be invested or held in financing
transactions, except:

     (a) Financing Obligations existing on the date hereof and set forth in Annex 1 to this
Schedule 4 and any Permitted Refinancing Obligations in respect of any such Financing
Obligations;

     (b) Financing Obligations created hereunder and under the other Commodities Purchase
Facility Documents;

     (c) unsecured intercompany Financing Obligations (i) of Tensar and its Subsidiaries
to the extent permitted by Section 1.04(a) of this Schedule 4 and (ii) of Tensar Holdings
and its Subsidiaries to the extent permitted by Section 1.04(l) of this Schedule 4, so long,
in each case, as such Financing Obligations are subordinated to the Obligations pursuant to
an Affiliate Subordination Agreement and any interest of Tensar or any Guarantor thereunder
is pledged to TCO pursuant to the Guarantee and Collateral Agreement;

     (d) Financing Obligations secured by Liens permitted by Section 1.02(i) of this
Schedule 4 (including Capital Lease Obligations and Synthetic Lease Obligations) in an
aggregate stated amount not exceeding $2,500,000 at any time outstanding;

     (e) Financing Obligations of Tensar under (i) the Lease Agreement in an aggregate
stated amount (excluding profit amount) not to exceed $147,000,000 and Financing Obligations
of the Guarantors under any Guarantees in respect of such Financing Obligations and any
Permitted Refinancing Obligations in respect of any such Financing Obligations and (ii) the
Second Lien Commodities Purchase Facility in aggregate stated amount (excluding profit
amount) not to exceed $84,000,000 and Financing Obligations of the Guarantors under any
Guarantees in respect of such Financing Obligations and any Permitted Refinancing
Obligations in respect of any such Financing Obligations;

     (f) Financing Obligations of any person that becomes a Subsidiary of Tensar after the
date hereof; provided that (i) such Financing Obligations exist at the time such
person becomes a Subsidiary and is not created in contemplation of or in connection with
such person becoming a Subsidiary, (ii) immediately before and after such person becomes a
Subsidiary, no Default or Event of Default shall have occurred and be

Schedule 4, Negative Covenants

 

 

continuing and (iii) the aggregate principal amount of Financing Obligations
permitted by this Section 1.01(f) shall not exceed $2,500,000 at any time outstanding;

     (g) Financing Obligations under performance bonds or with respect to workers’
compensation claims, in each case incurred in the ordinary course of business;

     (h) Financing Obligations arising from the honoring by a bank or other financial
institution of a check, draft or similar instrument inadvertently drawn against
insufficient funds in the ordinary course of business; provided that such Financing
Obligations are promptly covered by Tensar Holdings or any Subsidiary;

     (i) Financing Obligations of Tensar Holdings under the Tensar Holdings Commodities
Purchase Facility and any Permitted Refinancing Obligations in respect of any such Financing
Obligations, provided that any such Financing Obligations are subordinated to the
Obligations of Tensar Holdings under the Commodities Purchase Facility Documents pursuant to
the Tensar Holdings Subordination Agreement;

     (j) Guarantees made in the ordinary course of business by any Subsidiary Guarantor of
Financing Obligations otherwise permitted to be incurred by Tensar or any other Subsidiary
Guarantor under this Section 1.01, and

     (k) other unsecured Financing Obligations of Tensar Holdings or its Subsidiaries in an
aggregate principal amount not exceeding $2,500,000 at any time outstanding.

     SECTION 1.02. Liens. Create, incur, assume or permit to exist any Lien on any
property or assets (including Equity Interests or other securities of any person, including any
Subsidiary) now owned or hereafter acquired by it or on any income or revenues or rights in
respect of any thereof, except:

     (a) Liens on property or assets of Tensar and its Subsidiaries existing on the date
hereof and set forth in Annex 2 of this Schedule 4; provided that such Liens shall
secure only those obligations which they secure on the date hereof and refinancings,
extensions, renewals and replacements thereof permitted hereunder;

     (b) any Lien created under the Lease/Purchase Facilities Documents;

     (c) any Lien securing Financing Obligations permitted by Section 1.01(f) of this
Schedule 4 existing on any property or asset prior to the acquisition thereof by Tensar or
any Subsidiary; provided that (i) such Lien is not created in contemplation of or in
connection with such acquisition, (ii) such Lien does not apply to any other property or
assets of Tensar or any of its Subsidiaries and (iii) in the case of Mortgaged Property,
such Lien does not (A) materially interfere with the use, occupancy and operation of any
Mortgaged Property, (B) materially reduce the fair market value of such Mortgaged Property
but for such Lien or (C) result in any material increase in the cost of operating, occupying
or owning or leasing such Mortgaged Property;

Schedule 4, Negative Covenants

2

 

     (d) Liens for taxes not yet due or which are being contested in compliance
with Section 1.03 of Schedule 3;

     (e) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like
Liens arising in the ordinary course of business and securing obligations that are not due
and payable or which are being contested in compliance with Section 1.03 of Schedule 3;

     (f) pledges and deposits made in the ordinary course of business in
compliance with workmen’s compensation, unemployment insurance and other social security
laws or regulations;

     (g) deposits to secure the performance of bids, trade contracts (other than for
Financing Obligations), leases (other than Capital Lease Obligations),
statutory obligations, surety and appeal bonds, performance bonds and other obligations of a
like nature incurred in the ordinary course of business;

     (h) zoning restrictions, easements, rights-of-way, restrictions on use of real
property and other similar encumbrances incurred in the ordinary course of business which,
in the aggregate, are not substantial in amount and do not materially detract from the
value of the property subject thereto or interfere with the ordinary conduct of the
business of Tensar or any of its Subsidiaries or the ability of any of Tensar or any of its
Subsidiaries to utilize such property for its intended purpose;

     (i) Liens securing Financing Obligations, in an amount not to exceed $2,500,000 at
anytime outstanding, incurred to finance the acquisition (or construction) of fixed or
capital assets by Tensar or any of its Subsidiaries; provided that (i) such
security interests are incurred, and the Financing Obligations secured thereby is created,
within 90 days after such acquisition (or construction), (ii) such Liens do not at any time
encumber any property other than the property financed by such Financing Obligations and
(iii) the amount of Financing Obligations secured thereby is not increased;

     (j) judgment Liens securing judgments not constituting an Event of Default;

     (k) any interest or title of a lessor or sublessor under any lease entered into by
Tensar or any of its Subsidiaries in the ordinary course of business and covering only the
assets so leased;

     (l) Liens on the collateral securing obligations under the Second Lien Commodities
Purchase Facility; provided that such Liens are subordinated to the Liens securing
the Obligations in accordance with the terms of the Intercreditor Agreement; and

     (m) Liens on cash deposits and other funds maintained with a depositary institution,
in each case arising in the ordinary course of business by virtue of any statutory or
common law provision relating to banker’s liens; provided
that (i) the applicable
deposit account is not a dedicated cash collateral account and is not subject to
restrictions against access by Tensar Holdings or any of its Subsidiaries in excess of
those set forth in regulations promulgated by the Board and (ii) the applicable deposit
account

Schedule 4, Negative Covenants

3

 

is not intended by Tensar Holdings or any of its Subsidiaries to provide
collateral or security to the applicable depositary institution or any other person.

     SECTION 1.03. Sale and Lease-Back Transactions. Enter into any arrangement, other than
the transactions contemplated by the Lease Documents and the NAG Sale-Leaseback, directly or
indirectly, with any person whereby it shall sell or transfer any property, real or personal or
mixed, used or useful in its business, whether now owned or hereafter acquired, and thereafter rent
or lease such property or other property which it intends to use for substantially the same purpose
or purposes as the property being sold or transferred unless (a) the sale of such property is
permitted by Section 1.05 of this Schedule 4 and (b) (i) the aggregate amount of any obligations of
Tensar Holdings and its Subsidiaries with respect to operating or capital leases entered into in
connection therewith does not exceed the amount which Tensar Holdings and its Subsidiaries would be
permitted to incur as Capital Lease Obligations under Section 1.01 of this Schedule 4 and (ii) the
Liens arising in connection therewith are permitted by Section 1.02 of this Schedule 4.

     SECTION
1.04. Investments, Loans and Advances. Purchase, hold or acquire any Equity
Interests, evidences of obligations or other securities of, make or permit to exist any loans or
advances or capital contributions to, or make or permit any amounts to be invested or held in
financing transactions, or make or permit to exist any investment or any other interest in, any
other person (fall of the foregoing, “Investments”), except:

     (a) (i) Investments by Tensar Holdings, Holding, Tensar and the Subsidiaries existing
on the date hereof in the Equity Interests of Tensar and the Subsidiaries and (ii)
additional Investments by Tensar Holdings, Holdings, Tensar and the Subsidiaries in the
Equity Interests of Tensar and its Subsidiaries; provided that (A) any such Equity
Interests held by a Tensar Party shall be pledged pursuant to the Guarantee and Collateral
Agreement (subject to the limitation referred to in Section 1.09(d) of Schedule 3 in the
case of any Excluded Foreign Subsidiary), (B) the aggregate amount of Investments by Tensar
Parties in Subsidiaries of Tensar that are not Subsidiary Guarantors shall not exceed
$2,500,000 at any time outstanding and (C) if such Investment shall be in the form of a loan
or advance, such loan or advance shall be unsecured and subordinated to the Obligations
pursuant to an Affiliate Subordination Agreement and, if such loan or advance shall be made
by a Tensar Party, it shall be evidenced by a promissory note pledged to TCO pursuant to the
Guarantee and Collateral Agreement;

     (b) Permitted Investments;

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

     (d) Tensar Holdings and its Subsidiaries may make loans and advances in the ordinary
course of business to their respective employees so long as the aggregate principal amount
thereof at any time outstanding (determined without regard to any write-downs or write-offs
of such loans and advances) shall not exceed $750,000;

Schedule 4, Negative Covenants

4

 

     (e) advances made to Phillip D. Egan, Robert F. Vevoda and Gale D.
Sanders pursuant to the Split Dollar Insurance Documents;

     (f) advances not to exceed $150,000 in the aggregate to NAG employees for the purpose
of funding payments by such employees of tax liabilities incurred by them with respect to up
to 65,000 shares of restricted common stock of Tensar Holdings in the aggregate issued to
them under the stock option and restricted stock agreements entered into pursuant to the
Tensar Holdings 2000 Incentive Plan;

     (g) Tensar Holdings may hold promissory notes of employees of Tensar Holdings and its
Subsidiaries made by such employees in exchange for the purchase by such employees of Tensar
Holdings stock pursuant to the Restricted Stock Purchase Program;

     (h) the Acquisition and Permitted Acquisitions; provided that the aggregate purchase
price for all Permitted Acquisitions shall not exceed (i) $40,000,000 over the term of this
Agreement or (ii) $25,000,000 for any single Permitted Acquisition;

     (i) Investments, loans and advances existing on the date hereof and set forth on
Annex 4 to this Schedule 4;

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

     (k) Investments made as a result of the receipt of non-cash consideration from a sale,
transfer or other disposition of any asset in compliance with Section 1.05 of this Schedule
4;

     (l) intercompany loans and advances (i) to Tensar Holdings or to Holdings to the
extent that Tensar may pay dividends to Holdings and Holdings may pay dividends to Tensar
Holdings pursuant to Section 1.06 of this Schedule 4 (and in lieu of paying such dividends)
and (ii) to Holdings in an amount not to exceed $11,000,000 per annum to pay certain
operating expenses of Holdings and its Subsidiaries incurred in the ordinary course of
business and consistent with past practice, provided that the amount of such loans shall
not exceed the amount that is required to pay such expenses and the proceeds of such
intercompany loans are used to pay such expenses within 20 days of receipt thereof ;
provided further that any such intercompany loans and advances described in clause
(i) or (ii) shall be made for the purposes, and shall be subject to all the applicable
limitations set forth in, Section 1.06 of this Schedule 4 and shall be unsecured and
subordinated to the Obligations pursuant to an Affiliate Subordination Agreement; and

     (m) in addition to Investments permitted by clauses (a) through (l) above, additional
Investments by Tensar and its Subsidiaries so long as the aggregate amount invested, loaned
or advanced pursuant to this clause (j) (determined without regard to any write-downs or
write-offs of such investments, loans and advances) does not exceed $2,500,000 in the
aggregate.

     SECTION
1.05. Mergers, Consolidations, Sales of Assets and Acquisitions. Enter into
any transaction of merger or consolidation or liquidate, wind-up or dissolve itself (or suffer any

Schedule 4, Negative Covenants

5

 

liquidation or dissolution), or convey, sell, lease or sub-lease (as lessor or
sublessor), license or sub-license (as licensor or sub-licensor), exchange, transfer or otherwise
dispose of (in one transaction or in a series of transactions) all or any part of its business,
assets or property of any kind whatsoever, including the Equity Interests of a Subsidiary, whether
real, personal or mixed and whether tangible or intangible (whether now owned or hereafter
acquired) or purchase, lease or otherwise acquire (in one transaction or a series of transactions)
all or any substantial part of the assets of any other person, except for:

     (a) the sale by Tensar and its Subsidiaries of inventory in the ordinary course of business;

     (b) the sale or discount by Tensar or any of its Subsidiaries in each case without recourse
and in the ordinary course of business of overdue accounts receivable arising in the ordinary
course of business, but only in connection with the compromise or collection thereof consistent
with customary industry practice (and not as part of any bulk sale or financing transaction);

     (c) the disposition of obsolete or worn out assets, scrap and Permitted Investments in the
ordinary course of business;

     (d) the NAG Sale-Leaseback provided that the proceeds of such sale are used to pay in full the
purchase price for the NAG Facility;

     (e) the sale of assets on the Effective Date under the Asset Purchase Agreement;

     (f) the purchase and sale of commodities by Tensar under this Agreement;

     (g) the purchase and sale of commodities by Tensar Holdings pursuant to the Tensar Holdings
Commodities Purchase Agreement and by Tensar pursuant to the Second Lien Commodities
Purchase Facility Agreement; and

     (h) if at the time thereof and immediately after giving effect thereto no Event of Default or
Default shall have occurred and be continuing, (w) the merger or consolidation of any wholly owned
Subsidiary into or with Tensar in a transaction in which Tensar is the surviving corporation, (x)
the merger or consolidation of any wholly owned Subsidiary into or with any other wholly owned
Subsidiary in a transaction in which the surviving entity is a wholly owned Subsidiary and no
person other than Tensar or a wholly owned Subsidiary receives any consideration (provided
that if any party to any such transaction is (A) a Tensar Party, the surviving entity of such
transaction shall be a Tensar Party and (B) a Domestic Subsidiary, the surviving entity of such
transaction shall be a Domestic Subsidiary), (y) Permitted Acquisitions by Tensar or any of its
Subsidiaries (otherwise permitted by Section 1.04(h) of this Schedule 4), and (z) the sale, lease,
sub-lease, license, sub-license or other disposition of any part of its business, assets or
property (except any Equity Interests of Tensar) so long as (i) such Asset Sale is for
consideration at least 80% of which is cash (and no portion of the remaining consideration shall
be in the form of Financing Obligations of Tensar any of its Subsidiaries), (ii) such
consideration is at least equal to the fair market value of the assets being sold, transferred,
leased, licensed or disposed of and (iii) the fair market value of all assets sold, transferred,
leased, licensed or disposed of pursuant to this clause (z) shall not exceed $40,000,000 in the
aggregate.

Schedule 4, Negative Covenants

6

 

     SECTION
1.06. Restricted Payments; Restrictive Agreements. (a) Declare
or make, or agree to declare or make, directly or indirectly, any Restricted Payment (including
pursuant to any Synthetic Purchase Agreement), or incur any obligation (contingent or otherwise) to
do so; provided, however, that (i) any wholly-owned Subsidiary may declare and pay
dividends or make other distributions to its equity holders, (ii) so long as no Event of Default or
Default shall have occurred and be continuing or would result therefrom, Tensar may, or may make
distributions to Holdings, and Holdings may make distributions to Tensar Holdings so that Tensar
Holdings may, repurchase its Equity Interests owned by employees of Tensar Holdings or the
Subsidiaries or make payments to employees of Tensar Holdings or the Subsidiaries upon termination
of employment in connection with the exercise of stock options, stock appreciation rights or
similar equity incentives or equity based incentives pursuant to management incentive plans or in
connection with the death or disability of such employees in an aggregate amount not to exceed
$2,000,000 in any fiscal year and (iii) Tensar may make Restricted Payments to Holdings and
Holdings may make Restricted Payments to Tensar Holdings (x) in an amount not to exceed, when taken
together with the aggregate amount of all loans or advances made pursuant to Section 1.04(1) of
this Schedule 4 for such purpose, $350,000 in any fiscal year to the extent necessary to pay
general corporate and overhead expenses incurred by Tensar Holdings in the ordinary course of
business and (y) in an amount necessary to pay the Tax liabilities of Tensar Holdings directly
attributable to (or arising as a result of) the operations of Tensar and its Subsidiaries;
provided that (A) the amount of such dividends pursuant to clause (iii)(y) shall not exceed
the amount that Tensar and its Subsidiaries would be required to pay in respect of Federal, State
and local Taxes were Tensar and its Subsidiaries to pay such Taxes as stand-alone taxpayers and (B)
all Restricted Payments made to Tensar Holdings pursuant to clause (iii) shall be used by Tensar
Holdings for the purpose specified herein within 20 days of the receipt thereof.

     (b) Enter into, incur or permit to exist any agreement or other arrangement that prohibits,
restricts or imposes any condition upon (i) the ability of Tensar Holdings, Tensar or any
Subsidiary to create, incur or permit to exist any Lien upon any of its property or assets, or
(ii) the ability of any Subsidiary to pay dividends or other distributions with respect to any of
its Equity Interests or to make or repay loans or advances to Tensar or any other Subsidiary or to
Guarantee Financing Obligations of Tensar or any other Subsidiary; provided that (A) the
foregoing shall not apply to restrictions and conditions imposed by law or by any Lease/Purchase
Facilities Document, (B) the foregoing shall not apply to customary restrictions and conditions
contained in agreements relating to the sale of a Subsidiary pending such sale, provided
such restrictions and conditions apply only to the Subsidiary that is to be sold and such sale is
permitted hereunder, (C) the foregoing shall not apply to restrictions and conditions imposed on
any Subsidiary that is not a Tensar Party by the terms of any Financing Obligations of such
Subsidiary permitted to be incurred hereunder, (D) clause (i) of the foregoing shall not apply to
restrictions or conditions imposed by any agreement relating to secured Financing Obligations
permitted by this Agreement if such restrictions or conditions apply only to the property or
assets securing such Financing Obligations, (E) clause (i) of the foregoing shall not apply to
restrictions or conditions imposed by the Related Financing Documents, as in effect on the date
hereof, and (F) clause (i) of the foregoing shall not apply to customary provisions in leases,
licenses and other contracts restricting the assignment thereof.

Schedule 4, Negative Covenants

7

 

     SECTION
1.07. Transactions with Affiliates. Except for transactions by or
among Tensar Parties and except as set forth on Annex 7 to this Schedule 4, sell or transfer any
property or assets to, or purchase or acquire any property or assets from, or otherwise engage in
any other transactions with, any of its Affiliates, except that (a) Tensar and any of its
Subsidiaries may engage in any of the foregoing transactions in the ordinary course of business at
prices and on terms and conditions not less favorable to Tensar or such Subsidiary than could be
obtained on an arm’s-length basis from unrelated third parties, (b) Restricted Payments may be made
to the extent provided in Section 1.06 of this Section 4 and (c) if no Default or Event of Default
has occurred and is continuing, Tensar may pay to the Sponsor or its Affiliates (i) an annual
management fee in an amount not to exceed $1,000,000 per year and (ii) deferred merger and
acquisition fees earned in connection with the Acquisition, in an amount not to exceed $5,775,000
in the aggregate.

     SECTION 1.08. Business of Tensar Holdings, Holdings, Tensar and Subsidiaries; Limitation
on Hedging Agreements. (a) (i) With respect to Tensar Holdings, engage in any business
activities or have any assets or liabilities other than (A) its ownership of the Equity Interests
in Holdings, liabilities incidental thereto, including its liabilities pursuant to the
Lease/Purchase Facilities Documents, the Second Lien Commodities Purchase Facility Documents and
liabilities under the Tensar Holdings Commodities Purchase Facility Documents and (B) advances
made to employees of Holdings or its Subsidiaries to enable them to participate in the Restricted
Stock Purchase Program, provided that Tensar Holdings may also issue or sell shares of its
Equity Interests for cash so long as (x) the proceeds thereof are applied in prepayment in
accordance with this Agreement, and (y) no Change in Control occurs after giving effect thereto,
and (ii) with respect to Holdings, engage in any business activities, other than the business
conducted by it as of the date hereof, or have any assets or liabilities other than its ownership
of the Equity Interest in Tensar and liabilities incidental thereto, including its liabilities
pursuant to the Lease/Purchase Facilities Documents and the Second Lien Commodities Purchase
Facility Documents and liabilities consisting of administrative expenses of Tensar and its
Subsidiaries.

     (b) With respect to Tensar and its Subsidiaries, engage at any time in any business or
business activity other than the business conducted by it as of the date hereof and business
activities reasonably incidental thereto. Except as permitted under this Agreement, no Tensar
Party shall (i) make any changes in any of its business objective, purposes or operations that
could reasonably be expected to have or result in a Material Adverse Effect, (ii) make any change
in its capital structure as described in Annex 8 to this Schedule 4 (other than as permitted or
contemplated by Section 1.08(a)(i) of this Schedule 4) including the issuance or sale of any shares
of Equity Interests, warrants or other securities convertible into Equity Interests or any revision
of the terms of its outstanding Equity Interests; or (iii) amend its charter or bylaws in a manner
that would adversely affect TCO or such Tensar Party’s duty or ability to pay the Obligations.

     (c) Enter into any Hedging Agreement other than (a) any such agreement or arrangement
entered into in the ordinary course of business and consistent with prudent business practice to
hedge or mitigate risks to which Tensar or any of its Subsidiaries is exposed in the conduct of its
business or the management of its liabilities or (b) any such agreement entered into to hedge
against fluctuations in interest rates or currency incurred in the ordinary course of

Schedule 4, Negative Covenants

8

 

business and consistent with prudent business practice; provided that in each case
such agreements or arrangements shall not have been entered into for speculative purposes.

     SECTION
1.09. Other Financing Obligations and Agreements; Amendments to Acquisition
Documentation. (a) (i) Permit any waiver, supplement, modification, amendment, termination or
release of any indenture, instrument or agreement pursuant to which any Material Obligations (other
than any of the Lease Documents, the Second Lien Commodities Purchase Documents or the Tensar
Holdings Commodities Purchase Documents) of Tensar Holdings, Tensar or any of the Subsidiaries is
outstanding if the effect of such waiver, supplement, modification, amendment, termination or
release would materially increase the obligations of the obligor or confer additional material
rights on the holder of such Financing Obligations in a manner adverse to Tensar Holdings, Tensar,
any of the Subsidiaries, TCO or the Administrative Agent or (ii) permit any waiver, supplement,
modification, amendment, termination or release of any Second Lien Commodities Purchase Document
except in accordance with the Intercreditor Agreement or of any Tensar Holdings Commodities
Purchase Facility Document except in accordance with the Tensar Holdings Subordination Agreement.

     (b) (i) Make any distribution, payment or prepayment whether in cash, property, securities or
a combination thereof, in respect of, or pay, or offer or commit to pay, or directly or indirectly
(including pursuant to any Synthetic Purchase Agreement) redeem, repurchase, retire or otherwise
acquire for consideration, or set apart any sum for the aforesaid purposes, any Financing
Obligations (other than any Financing Obligations under the Lease/Purchase Facilities Documents),
except (A) regular scheduled payments thereunder as and when due (to the extent not prohibited
by applicable subordination provisions), (B) refinancings of Financing Obligations
permitted by Section 1.01 of this Schedule 4, (C) the payment of secured Financing Obligations
that becomes due as a result of the voluntary sale or transfer of the property or assets securing
such Financing Obligations, or (D) so long as no Event of Default or Default shall have
occurred and be continuing or would result therefrom, the payment of intercompany
Financing Obligations or (ii) pay in cash any amount in respect of any Financing Obligations or
preferred Equity Interests (including any obligations with respect to the Tensar Holdings
Commodities Purchase Facility) that may at the obligor’s option be paid in kind or in other
securities.

     (c) (i) Permit any waiver, supplement, modification, amendment, termination or release of, or
fail to enforce in a commercially reasonable manner the terms and conditions of, any of the
indemnities and licenses furnished to Tensar Holdings, Tensar or the Subsidiaries pursuant to the
Acquisition Documentation such that after giving effect thereto such indemnities or licenses shall
be materially less favorable to the interests of the Tensar Parties with respect thereto or (ii)
otherwise permit any waiver, supplement, modification, amendment, termination or release of, or
fail to enforce in a commercially reasonable manner the terms and conditions of, any of the
Acquisition Documentation except to the extent that such waiver, supplement, modification,
amendment, termination or release or failure to enforce could not reasonably be expected to have a
Material Adverse Effect.

     SECTION 1.10. Capital Expenditures. Permit the aggregate amount of Capital
Expenditures made by Tensar and its Subsidiaries in any period set forth below to exceed the amount
set forth below for such period:

Schedule 4, Negative Covenants

9

 

	 	 	 	 	 
	Fiscal Year	 	Amount
	2005
	 	$	5,000,000	 
	2006
	 	$	20,000,000	 
	2007
	 	$	5,000,000	 
	2008 and each fiscal year
thereafter until 2012
	 	$	5,000,000	 

The amount of permitted Capital Expenditures set forth above in respect of any fiscal year
commencing with the fiscal year ending on December 31, 2006, shall be increased (but not decreased)
by 50% of (a) the amount of unused permitted Capital Expenditures for the immediately preceding
fiscal year less (b) an amount equal to unused Capital Expenditures carried forward to such
preceding fiscal year.

     SECTION 1.11. Financing Coverage Ratio. Permit the Financing Coverage Ratio
during any period set forth below to be less than the ratio set forth opposite such period below:

	 	 	 	 	 
	Fiscal Quarter Ended:	 	Ratio
	December 31, 2005
	 	 	1.50:1.00	 
	March 31, 2006
	 	 	1.50:1.00	 
	June 30, 2006
	 	 	1.50:1.00	 
	September 30, 2006
	 	 	1.50:1.00	 
	December 31, 2006
	 	 	1.75:1.00	 
	March 31, 2007
	 	 	1.75:1.00	 
	June 30, 2007
	 	 	1.75:1.00	 
	September 30, 2007
	 	 	1.75:1.00	 
	December 31, 2007
	 	 	2.00:1.00	 
	March 31, 2008
	 	 	2.00:1.00	 
	June 30, 2008
	 	 	2.00:1.00	 
	September 30, 2008
	 	 	2.00:1.00	 
	December 31, 2008
	 	 	2.25:1.00	 
	March 31, 2009
	 	 	2.25:1.00	 
	June 30, 2009
	 	 	2.25:1.00	 
	September 30, 2009
	 	 	2.25:1.00	 
	December 31, 2009
	 	 	2.50:1.00	 
	March 31, 2010
	 	 	2.50:1.00	 
	June 30, 2010
	 	 	2.50:1.00	 
	September 30, 2010
	 	 	2.50:1.00	 
	December 31, 2010 and each fiscal
quarter thereafter until 2012
	 	 	3.00:1.00	 

Schedule 4, Negative Covenants

10

 

     SECTION 1.12. Leverage Ratio. Permit the Leverage Ratio during any period set forth
below to be greater than the ratio set forth opposite such period below:

	 	 	 	 	 
	Fiscal Quarter Ended:	 	Ratio
	December 31, 2005
	 	 	6.75:1.00	 
	March 31, 2006
	 	 	6.75:1.00	 
	June 30, 2006
	 	 	6.75:1.00	 
	September 30, 2006
	 	 	6.50:1.00	 
	December 31, 2006
	 	 	6.25:1.00	 
	March 31, 2007
	 	 	6.25:1.00	 
	June 30, 2007
	 	 	5.75:1.00	 
	September 30, 2007
	 	 	5.50:1.00	 
	December 31, 2007
	 	 	5.25:1.00	 
	March 31, 2008
	 	 	5.25:1.00	 
	June 30, 2008
	 	 	5.25:1.00	 
	September 30, 2008
	 	 	5.25:1.00	 
	December 31, 2008
	 	 	4.75:1.00	 
	March 31, 2009
	 	 	4.75:1.00	 
	June 30, 2009
	 	 	4.75:1.00	 
	September 30, 2009
	 	 	4.75:1.00	 
	December 31, 2009
	 	 	4.25:1.00	 
	March 31, 2010
	 	 	4.25:1.00	 
	June 30, 2010
	 	 	4.25:1.00	 
	September 30, 2010
	 	 	4.25:1.00	 
	December 31, 2010
	 	 	3.75:1.00	 
	March 31, 2011
	 	 	3.75:1.00	 
	June 30, 2011
	 	 	3.75:1.00	 
	September 30, 2011
	 	 	3.75:1.00	 
	December 31, 2011
	 	 	3.25:1.00	 
	March 31, 2012
	 	 	3.25:1.00	 
	June 30, 2012
	 	 	3.25:1.00	 
	September 30, 2012
	 	 	3.25:1.00	 
	December 31, 2012
	 	 	2.75:1.00	 

     SECTION 1.13. Fixed Charge Coverage Ratio. Permit the Fixed Charge Coverage Ratio
during any period set forth below to be less than the ratio set forth opposite such period below:

Schedule 4, Negative Covenants

11

 

	 	 	 	 	 
	Fiscal Quarter Ended:	 	Ratio
	December 3, 2005
	 	 	1.25:1.00	 
	March 31, 2006
	 	 	1.25:1.00	 
	June 30, 2006
	 	 	1.25:1.00	 
	September 30, 2006
	 	 	1.25:1.00	 
	December 31, 2006
	 	 	1.25:1.00	 
	March 31, 2007
	 	 	1.25:1.00	 
	June 30, 2007
	 	 	1.25:1.00	 
	September 30, 2007
	 	 	1.25:1.00	 
	December 31, 2007
	 	 	1.35:1.00	 
	March 31, 2008
	 	 	1.35:1.00	 
	June 30, 2008
	 	 	1.35:1.00	 
	September 30, 2008
	 	 	1.35:1.00	 
	December 31, 2008
	 	 	1.40:1.00	 
	March 31, 2009
	 	 	1.40:1.00	 
	June 30, 2009
	 	 	1.40:1.00	 
	September 30, 2009
	 	 	1.40:1.00	 
	December 31, 2009 and each fiscal
quarter thereafter through 2012
	 	 	1.50:1.00	 

     SECTION
1.14. First Lien Leverage Ratio. Permit the First Lien Leverage Ratio
during any period set forth below to be greater than the ratio set forth opposite such period
below:

	 	 	 	 	 
	Fiscal Quarter Ended:	 	Ratio
	December 31, 2005
	 	 	4.50:1.00	 
	March 31, 2006
	 	 	4.50:1.00	 
	June 30, 2006
	 	 	4.50:1.00	 
	September 30, 2006
	 	 	4.50:1.00	 
	December 31, 2006
	 	 	4.00:1.00	 
	March 31, 2007
	 	 	4.00:1.00	 
	June 30, 2007
	 	 	3.75:1.00	 
	September 30, 2007
	 	 	3.50:1.00	 
	December 31, 2007
	 	 	3.25:1.00	 
	March 31, 2008
	 	 	3.25:1.00	 

Schedule 4, Negative Covenants

12

 

	 	 	 	 	 
	Fiscal Quarter Ended:	 	Ratio
	June 30, 2008
	 	 	3.00:1.00	 
	September 30, 2008
	 	 	3.00:1.00	 
	December 31, 2008
	 	 	2.75:1.00	 
	March 31, 2009
	 	 	2.75:1.00	 
	June 30, 2009
	 	 	2.75:1.00	 
	September 30, 2009
	 	 	2.75:1.00	 
	December 31, 2009
	 	 	2.50:1.00	 
	March 31, 2010
	 	 	2.50:1.00	 
	June 30, 2010
	 	 	2.50:1.00	 
	September 30, 2010
	 	 	2.50:1.00	 
	December 31, 2010
	 	 	2.25:1.00	 
	March 31, 2011
	 	 	2.25:1.00	 
	June 30, 2011
	 	 	2.25:1.00	 
	September 30, 2011
	 	 	2.25:1.00	 
	December 31, 2011
	 	 	2.00:1.00	 
	March 31, 2012
	 	 	2.00:1.00	 
	June 30, 2012
	 	 	2.00:1.00	 
	September 30, 2012
	 	 	2.00:1.00	 
	December 31, 2012
	 	 	1.75:1.00	 

     SECTION
1.15. Fiscal Year. With respect to Tensar Holdings or Tensar, change its
fiscal year-end to a date other than December 31.

     SECTION 1.16. Limitation on Accounting Changes. Make or permit any material change in
accounting policies or reporting practices without advising TCO, unless such changes are required
by GAAP or applicable law; provided, that (a) compliance with the covenants set forth on this
Schedule 4 shall be determined on the basis of GAAP without giving effect to the relevant change
and (b) in connection with any such change Tensar Holdings will provide TCO with guidance regarding
how to reconcile financial statements prepared after the implementation of such material change
with financial statements provided to TCO and prepared before the implementation of such material
change.

     SECTION 1.17. Leases. No Tensar Party shall enter into any operating leases after the
Effective Date for equipment or real property if the aggregate of all such operating lease payments
payable in any year for all Tensar Parties on a consolidated basis would exceed the sum of (i)
$1,000,000 and (ii) the aggregate of lease payments for the leases set forth in Annex 17 to this
Schedule 4.

Schedule 4, Negative Covenants

13

 

Schedule 5

 EVENTS OF DEFAULT

 

 

Execution Copy

Schedule 5

Events of Default

     Upon
the occurrence of any of the following events (each, an “Event
of Default”):

     (a) any representation or warranty made or deemed made in or in connection with any
Commodities Purchase Facility Document, or any representation, warranty, statement or information
contained in any report, certificate, financial statement or other instrument furnished in
connection with or pursuant to any Commodities Purchase Facility Document, shall prove to have been
false or misleading in any material respect when so made, deemed made or furnished;

     (b) default shall be made in the payment of any portion of Purchase Price or Reimbursement
Obligation 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;

     (c) default shall be made in the payment of any Agreed Profit or any other Obligation (other
than an amount referred to in clause (b) above), when and as the same shall become due and payable,
and such default shall continue unremedied for a period of three Business Days;

     (d) default shall be made in the due observance or performance by Tensar Holdings, Tensar or
any Subsidiary of any covenant, condition or agreement contained in Sections 1.01(a), 1.02,
1.05(a) and (e), 1.08 or 1.16 of Schedule 3 or in Schedule 4;

     (e) default shall be made in the due observance or performance by Tensar Holdings, Tensar or
any Subsidiary of any covenant, condition or agreement contained in any Commodities Purchase
Facility Document (other than those specified in clauses (b), (c) or (d) above) and such default
shall continue unremedied for a period of 30 days after the earlier of (i) the date on which Tensar
Holdings, Tensar or any Subsidiary has, or should have had, knowledge thereof and (ii) the date of
which TCO or the Administrative Agent notifies Tensar Holdings or Tensar of any such default;

     (f) (i) Either Tensar Holdings, Tensar or any Subsidiary shall (i) fail to pay any amount or
profit or rent due with respect thereto, regardless of amount, due in respect of any Material
Obligation, when and as the same shall become due and payable, or (ii) any other event or condition
occurs that results in any Material Obligation becoming due prior to its scheduled maturity or that
enables or permits (with or without the giving of notice, the lapse of time or both) the holder or
holders of any Material Obligation or any trustee or agent on its or their behalf to cause any
Material Obligation to become due, or to require the prepayment, repurchase, redemption or
defeasance thereof, prior to its scheduled maturity; provided that this clause (ii) shall
not apply to any secured Financing Obligations that become due as a result of the voluntary sale or
transfer of the property or assets securing such Financing Obligations;

     (g) an involuntary proceeding shall be commenced or an involuntary petition shall be filed in
a court of competent jurisdiction seeking (i) relief in respect of Tensar Holdings, Holdings,
Tensar or any Material Subsidiary, or of a substantial part of the property or assets of Tensar
Holdings, Holdings, Tensar or such Material Subsidiary, under Title 11 of the United

Schedule 5, Events of Default

 

 

States Code, as now constituted or hereafter amended, or any other Federal, state or foreign
bankruptcy, insolvency, receivership or similar law, (ii) the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for Tensar Holdings, Holdings, Tensar or
any Material Subsidiary or for a substantial part of the property or assets of Tensar Holdings,
Holdings, Tensar or such Material Subsidiary or (iii) the winding-up or liquidation of Tensar
Holdings, Holdings, Tensar or any Material Subsidiary and such proceeding or petition shall
continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing
shall be entered;

     (h) any of Tensar Holdings, Holdings, Tensar or any Material Subsidiary shall (i) voluntarily
commence any proceeding or file any petition seeking relief under Title 11 of the United States
Code, as now constituted or hereafter amended, or any other Federal, state or foreign bankruptcy,
insolvency, receivership or similar law, (ii) consent to the institution of, or fail to contest in
a timely and appropriate manner, any proceeding or the filing of any petition described in (g)
above, (iii) apply for or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for Tensar Holdings, Holdings, Tensar or any Material
Subsidiary or for a substantial part of the property or assets of Tensar Holdings, Holdings, Tensar
or any Material Subsidiary, (iv) file an answer admitting the material allegations of a petition
filed against it in any such proceeding, (v) make a general assignment for the benefit of
creditors, (vi) become unable, admit in writing its inability or fail generally to pay its
obligations as they become due or (vii) take any action for the purpose of effecting any of the
foregoing;

     (i) one or more judgments for the payment of money in an aggregate amount in excess of
$2,500,000 (to the extent not adequately covered by insurance as to
which a solvent and
unaffiliated insurance company has acknowledged coverage) or other judgments that, individually or
in the aggregate, could reasonably be expected to result in a Material Adverse Effect shall be,
rendered against Tensar Holdings, Tensar, any Subsidiary or any combination  thereof and the same
shall remain undischarged for a period of 30 consecutive days during which execution shall not be
effectively stayed, or any action shall be legally taken by a judgment creditor to levy upon assets
or properties of Tensar Holdings, Tensar or any Subsidiary to enforce any such judgment;

     (j) an ERISA Event described in clause (b) of the definition thereof shall have occurred or
any other ERISA Event shall have occurred that, when taken together with all other such ERISA
Events, could reasonably be expected to result in liability of Tensar and its ERISA Affiliates in
an aggregate amount exceeding $2,500,000;

     (k) any Guarantee under the Guarantee and Collateral Agreement or otherwise constituting
Obligations for any reason shall cease to be in full force and effect (other than in accordance
with its terms), or any Guarantor or Tensar shall deny that it has any further liability under such
Guarantee (other than as a result of the discharge of such Guarantor, or Tensar, as the case may
be, in accordance with the terms of the Commodities Purchase Facility Documents);

     (l) any Lien purported to be created under any Security Document shall cease to be, or shall
be asserted by any Tensar Party not to be, a valid, perfected and, with respect to TCO, first
priority (except as otherwise expressly provided in this Agreement or such Security

Schedule 5, Events of Default

2

 

Document) Lien on any material Collateral covered thereby, except to the extent that any such loss
of perfection or priority results from the failure of TCO (or it lenders) to maintain possession of
certificates representing Equity Interests pledged under the Guarantee and Collateral Agreement;

     (m) there shall have occurred a Change in Control;

     (n) a default under or breach of the Netlon License shall have occurred and be
continuing that would permit the licensor to terminate the Netlon License; or

     (o) the Netlon License shall terminate for any reason, other than at maturity in
accordance with its terms;

then, and in every such event (other than an event with respect to Tensar Holdings or Tensar
described in clause (g) or (h) above), and at any time thereafter during the continuance of such
event TCO or the Administrative Agent may declare its obligation to make the Commodities Purchase
Facility available to Tensar, or to enter into Transactions at the request of Tensar, to be
terminated, whereupon the same shall immediately terminate; or may declare all Obligations payable
by Tensar or Tensar Holdings under this Agreement or the Reimbursement Agreement, including, but
not limited to, the Aggregate Murabaha Price and any Reimbursement Letter Obligations Exposure, to
be forthwith due and payable, whereupon all such Obligations shall become forthwith due and
payable, without presentment, demand, protest or any other notice of any kind, all of which are
hereby expressly waived by Tensar and Tensar Holdings, anything contained herein or in any other
Commodities Purchase Facility Document to the contrary notwithstanding, and TCO and the
Administrative Agent shall have the right to take all or any actions and exercise any remedies
available to a secured party under the Security Documents or applicable law or in
equity; and in any event with respect to Tensar Holdings or Tensar described in clause (g) or (h)
above, obligation to make the Commodities Purchase Facility available to (Tensar, or to enter
into Transactions or Guarantee Obligations at the request of Tensar, shall automatically terminate
and all Obligations payable by Tensar or Tensar Holdings under this Agreement or the Reimbursement
Agreement, including, but not limited to, the Aggregate Murabaha Price and any Reimbursement Letter
Obligations, and all other liabilities of Tensar and Tensar Holdings accrued hereunder and under
any other Commodities Purchase Facility Document shall automatically become due and payable,
without presentment, demand, protest or any other notice of any kind, all of which are hereby
expressly waived by Tensar Holdings and Tensar, anything contained herein or in any other
Commodities Purchase Facility Document to the contrary notwithstanding, and TCO and the
Administrative Agent shall have the right to take all or any actions and exercise any remedies
available to a secured party under the Security Documents or applicable law or in equity.

Schedule 5, Events of Default

3

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