Document:

Exhibit 10.2 to Deluxe Corporation Form 10-Q

Exhibit 10.2 

DELUXE CORPORATION 2000 STOCK INCENTIVE PLAN, AS AMENDED 

Section 1.    Purpose. 

        The
purpose of the plan is to promote the interests of the Company and its shareholders by
aiding the Company in attracting management personnel capable of assuring the future
success of the Company, by offering such personnel incentives to put forth maximum
efforts for the success of the Company’s business, and by affording such personnel
an opportunity to acquire a proprietary interest in the Company.  

Section 2.    Definitions. 

        As
used in the plan, the following terms shall have the meanings set forth below:  

                (a)            “Affiliate” shall
mean (i) any entity that, directly or indirectly through one or more intermediaries, is
controlled by the Company and (ii) any entity in which the Company has a significant
equity interest, in each case as determined by the committee.  

                (b)            “Award” shall
mean any option, stock appreciation right, restricted stock, restricted stock unit,
performance award, dividend equivalent or other stock-based award granted under the plan.  

                (c)            “Award
Agreement” shall mean any written agreement, contract or other instrument or
document evidencing any award granted under the plan.  

                (d)            “Code” shall
mean the Internal Revenue Code of 1986, as amended from time to time, and any regulations
promulgated thereunder.  

                (e)            “Committee” shall
mean a committee of the board of directors of the Company designated by such board to
administer the plan, which shall consist of members appointed from time to time by the
board of directors and shall be comprised of not fewer than such number of directors as
shall be required to permit grants and awards made under the plan to satisfy the
requirements of Rule 16b-3. Each member of the committee shall be a “Non-Employee
Director”within the meaning of Rule 16b-3 and an “outside director” within
the meaning of Section 162(m) of the Code. The Company expects to have the Plan
administered such that certain awards shall be “qualified performance-based
compensation” within the meaning of Section 162(m) of the Code.  

                (f)            “Company” shall
mean DELUXE CORPORATION, a Minnesota corporation, and any successor corporation.  

                (g)            “Dividend
Equivalent” shall mean any right granted under Section 6(e) of the plan.  

  

                (h)            “Eligible
Person” shall mean a non-employee director and any employee (as determined by the
committee) providing services to the Company or any affiliate who the committee
determines to be an eligible person.  

                (i)            “Fair
Market Value” shall mean, with respect to any property (including, without
limitation, any shares or other securities), the fair market value of such property
determined by such methods or procedures as shall be established from time to time by the
committee.  

                (j)            “Incentive
Stock Option” shall mean an option granted under Section 6(a) of the plan that is
intended to meet the requirements of Section 422 of the Code or any successor provision.  

                (k)            “Non-Employee
Director” shall have the meaning provided in Section 7(a) of the plan.  

                (l)            “Non-Qualified
Stock Option” shall mean an option granted under Section 6(a) of the plan that is
not intended to be an incentive stock option.  

                (m)            “Option” shall
mean an incentive stock option or a non-qualified stock option and shall be deemed to
include any reload option issued under the plan.  

                (n)            “Other
Stock-Based Award” shall mean any right granted under Section 6(f) of the plan.  

                (o)            “Participant” shall
mean an eligible person designated to be granted an award under the plan.  

                (p)            “Performance
Award” shall mean any right granted under Section 6(d) of the plan.  

                (q)            “Person” shall
mean any individual, corporation, partnership, association or trust.  

                (r)            “Plan” shall
mean this stock incentive plan, as amended from time to time.  

                (s)            “Reload
Option” means an option issued under Section 6(a) to purchase a number of shares
equal to the number of shares delivered by an option holder (or such lesser number as the
committee may determine) in payment of all or any portion of the exercise price of an
option previously granted under this plan to such holder, provided that the option term
of such option shall not end later than the option term of the option so exercised.  

                (t)            “Reload
Option Feature” means provisions in an option granted under this plan that permit
the holder of the option to receive a reload option upon the exercise of the option
through the delivery of shares in payment of all or any portion of the exercise price. A
reload option feature may be included in any reload option issued under the plan.  

                (u)            “Restricted
Stock” shall mean any share granted under Section 6(c) of the plan.  

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                (v)            “Restricted
Stock Unit” shall mean any unit granted under Section 6(c) of the plan evidencing
the right to receive a share (or a cash payment equal to the fair market value of a
share) at some future date.  

                (w)            “Rule
16b-3” shall mean Rule 16b-3 promulgated by the Securities and Exchange Commission
under the Securities Exchange Act of 1934, as amended, or any successor rule or
regulation.  

                (x)            “Section
162(m)” shall mean Section 162(m) of the Code and the applicable Treasury
Regulations promulgated thereunder.  

                (y)            “Shares” shall
mean shares of common stock, $1.00 par value, of the Company or such other securities or
property as may become subject to awards pursuant to an adjustment made under Section
4(c) of the plan.  

                (z)            “Stock
Appreciation Right” shall mean any right granted under Section 6(b) of the plan.  

Section 3.    Administration. 

                (a)            Power
and Authority of the Committee.   The plan shall be administered by the committee. Except as provided
in Section 7 and subject to the express provisions of the plan and to applicable law, the committee shall have full
power and authority to: (i) designate participants; (ii) determine the type or types of awards to be granted
to each participant under the plan; (iii) determine the number of shares to be covered by (or with respect to which
payments, rights or other matters are to be calculated in connection with) each award; (iv) determine the terms and
conditions of any award or award agreement; (v) amend the terms and conditions of any award or award agreement and
accelerate the exercisability of options or the lapse of restrictions relating to restricted stock or other awards;
(vi) determine whether, to what extent and under what circumstances awards may be exercised in cash, shares, other
securities, other awards or other property, or canceled, forfeited or suspended; (vii) determine whether, to what
extent and under what circumstances cash, shares, other securities, other awards, other property and other amounts
payable with respect to an award under the plan shall be deferred either automatically or at the election of the holder
thereof or the committee; (viii) interpret and administer the plan and any instrument or agreement relating to, or
award made under, the plan; (ix) establish, amend, suspend or waive such rules and regulations and appoint such
agents as it shall deem appropriate for the proper administration of the plan; and (x) make any other determination
and take any other action that the committee deems necessary or desirable for the administration of the plan. Unless
otherwise expressly provided in the plan, all designations, determinations, interpretations and other decisions under or
with respect to the plan or any award shall be within the sole discretion of the committee, may be made at any time and
shall be final, conclusive and binding upon any participant, any holder or beneficiary of any award and any employee of
the Company or any affiliate. 

                (b)            Delegation.   The
committee may delegate its powers and duties under the plan to one or more officers of the company or an affiliate or a
committee of such officers, subject to such terms, conditions and limitations as the committee may establish in its sole
discretion; provided, however, that the committee shall not delegate its powers and duties under the plan (i)

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with regard to officers or directors of the Company or any
affiliate who are subject to Section 16 of the Securities Exchange Act of 1934, as amended, if the effect of such
delegation would make the exemption under Rule 16b-3 unavailable or (ii) in such a manner as would cause the plan not to
comply with the requirements of Section 162(m) of the Code. 

Section 4.    Shares Available for Awards. 

                (a)            Shares
Available.   Subject to adjustment as provided in Section 4(c), the number of shares available
for granting awards under the plan shall be 8,500,000. (The shareholders originally approved the plan with 3,000,000
shares available and, at the 2002 annual meeting, approved an amendment to the plan to increase the shares available by
5,500,000.) Shares to be issued under the plan may be either shares reacquired or authorized but unissued shares. If any
shares covered by an award or to which an award relates are not purchased or are forfeited, or if an award otherwise
terminates without delivery of any shares, then the number of shares counted against the aggregate number of shares
available under the plan with respect to such award, to the extent of any such forfeiture or termination, shall again be
available for grants under the plan. Shares delivered in payment of the option exercise price of an option not
containing a reload option feature shall again be available for granting awards under the plan (other than incentive
stock options) to the extent that the number of shares so delivered are made subject to an option granted pursuant to
section 6(a)(v). 

                (b)            Accounting
for Awards.   For purposes of this Section 4, if an award entitles the holder thereof to receive
or purchase shares, the number of shares covered by such award or to which such award relates shall be counted on the
date of grant of such award against the aggregate number of shares available for grants under the plan. 

                (c)            Adjustments.   In
the event that the committee shall determine that any dividend or other distribution (whether in the form of cash,
shares, other securities or other property), recapitalization, stock split, reverse stock split, reorganization, merger,
consolidation, split-up, spin-off, combination, repurchase or exchange of shares or other securities of the Company,
issuance of warrants or other rights to purchase shares or other securities of the Company or other similar corporate
transaction or event affects the shares such that an adjustment is determined by the committee to be appropriate in
order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the
plan, then the committee shall, in such manner as it may deem equitable, adjust any or all of (i) the number and
type of shares (or other securities or other property) which thereafter may be made the subject of awards, (ii) the
number and type of shares (or other securities or other property) subject to outstanding awards and (iii) the
purchase or exercise price with respect to any award; provided, however, that the number of shares covered by any award
or to which such award relates shall always be a whole number. 

                (d)            Awards Limitation Under the Plan. 

	  	  	  	(i)  	  	Section 162(m)
Limitation for Certain Types of Awards.   No eligible person may be
granted options, stock appreciation rights or any other award or awards under the plan,
the value of which award or awards is based solely on an increase in the value of the
shares after the date of grant of such award or awards, for more than 400,000 shares
(subject to adjustment as provided in Section 4(c) of the plan) in  

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	  	  	  	  	  	the aggregate
in any calendar year. The foregoing limitation shall not include any shares acquired
pursuant to the annual incentive plan.  

	  	  	  	(ii)  	  	 Section 162(m)
Limitation for Performance Awards.   The maximum amount payable
pursuant to all performance awards to any participant in the aggregate in any calendar
year shall be $5.0 million in value, whether payable in cash, shares or other property.
This limitation does not apply to any award subject to the limitation contained in Section 4(d)(i)
of the plan and shall not include any shares acquired pursuant to the annual incentive
plan.  

	  	  	  	(iii)  	  	 Plan
Limitation on Restricted Stock, Restricted Stock Units and Performance Awards.   No
more than 3,500,000 shares, subject to adjustment as provided in Section 4(c) of the
plan, shall be available under the plan for issuance pursuant to grants of restricted
stock, restricted stock units and performance awards; provided, however, that if any
awards of restricted stock units or performance awards terminate or are forfeited or
cancelled without delivery of any shares or if shares of restricted stock are forfeited,
whether or not dividends have been paid on such shares, then the shares subject to such
termination, forfeiture or cancellation shall again be available for grants of restricted
stock, restricted stock units and performance awards for purposes of this limitation on
grants of such awards.  

Section 5.    Eligibility. 

        Any eligible
person, including any eligible person who is an officer or director of the Company or any affiliate, shall be eligible
to be designated a participant. In determining which eligible persons shall receive an award and the terms of any award,
the committee may take into account the nature of the services rendered by the respective eligible persons, their
present and potential contributions to the success of the Company, and such other factors as the committee, in its
discretion shall deem relevant. Notwithstanding the foregoing, incentive stock options may only be granted to full or
part-time employees (which term as used herein includes, without limitation, officers and directors who are also
employees) and an incentive stock option shall not be granted to an employee of an affiliate unless such affiliate is
also a “subsidiary corporation” of the Company within the meaning of Section 424(f) of the Code or any
successor provision. 

Section 6.    Awards. 

	  	(a) 	  	Options.   The committee is hereby
authorized to grant options to participants with the following terms and conditions and with such additional terms and
conditions not inconsistent with the provisions of the plan as the committee shall determine: 

	  	  	  	(i)  	  	 Exercise
Price.   The purchase price per share purchasable under an option
shall be determined by the committee; provided, however, that such purchase price shall
not be less than 100 percent of the fair market value of a share on the date of grant of
such option and provided further, that in no event shall options previously granted under
this Plan be re-priced by reducing the exercise price thereof, nor shall options
previously granted under this Plan be cancelled and replaced by  

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	  	  	  	  	  	a subsequent
re-grant under this Plan of options having an exercise price lower than the options so
cancelled.  

	  	  	  	(ii)  	  	Option
Term.   The term of each option shall be fixed by the committee but
shall not be longer than 10 years from the date of grant.  

	  	  	  	(iii)  	  	Time
and Method of Exercise.   The committee shall determine the time or
times at which an option may be exercised in whole or in part and the method or methods
by which, and the form or forms (including, without limitation, cash, shares, promissory
notes, other securities, other awards or other property, or any combination thereof,
having a fair market value on the exercise date equal to the relevant exercise price) in
which, payment of the exercise price with respect thereto may be made or deemed to have
been made.  

	  	  	  	(iv)  	  	Reload
Option Feature.   The committee may determine, in its discretion,
whether to grant an option containing a reload option feature and whether any reload
option issued upon the exercise of an option containing a reload option feature may
itself contain a reload option feature.  

	  	  	  	(v)  	  	Issuance
of Options to Replace Shares.   The committee may determine, in its
discretion, whether to grant to a participant who exercises by delivery of shares in
payment of all or any portion of the exercise price an option, previously or hereafter
granted under the plan, that does not contain a reload option feature, an option to
acquire the number of shares so delivered (or such lesser number as the committee may
determine), provided that the option term of such option shall not end later than the
option term of the option so exercised.  

                (b)            Stock
Appreciation Rights.   The committee is hereby authorized to grant stock appreciation rights to
participants subject to the terms of the plan and any applicable award agreement. A stock appreciation right granted
under the plan shall confer on the holder thereof a right to receive upon exercise thereof the excess of (i) the fair
market value of one share on the date of exercise (or, if the committee shall so determine, at any time during a
specified period before or after the date of exercise) over (ii) the grant price of the stock appreciation right as
specified by the committee, which price shall not be less than 100 percent of the fair market value of one share on the
date of grant of the stock appreciation right. Subject to the terms of the plan and any applicable award agreement, the
grant price, term, methods of exercise, dates of exercise, methods of settlement and any other terms and conditions of
any stock appreciation right shall be as determined by the committee. The committee may impose such conditions or
restrictions on the exercise of any stock appreciation right as it may deem appropriate. 

                (c)            Restricted
Stock and Restricted Stock Units.   The committee is hereby authorized to grant awards of restricted
stock and restricted stock units to participants with the following terms and conditions and with such additional terms
and conditions not inconsistent with the provisions of the plan as the committee shall determine: 

	  	  	  	(i)  	  	Restrictions.   Shares
of restricted stock and restricted stock units shall be subject to such restrictions as
the committee may impose (including, without limitation, any limitation on the right to
vote a share of restricted stock or the right to receive  

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	  	  	  	  	  	any dividend
or other right or property with respect thereto or with respect to a restricted stock
unit), which restrictions may lapse separately or in combination at such time or times,
in such installments or otherwise as the committee may deem appropriate.  

	  	  	  	(ii)  	  	 Stock
Certificates.   Any restricted stock granted under the plan may be
evidenced by issuance of a stock certificate or certificates or by the creation of a book
entry at the Company’s transfer agent. Any such certificate or certificates shall be
held by the Company. Such certificate or certificates or book entry shall be registered
in the name of the participant and any such certificate or certificates shall bear an
appropriate legend referring to the terms, conditions and restrictions applicable to such
restricted stock. A similar notation shall be made in the records of the transfer agent
with respect to any shares evidenced by a book entry. In the case of restricted stock
units, no shares shall be issued at the time such awards are granted.  

	  	  	  	(iii)  	  	 Forfeiture;
Delivery of Shares.   Except as otherwise determined by the committee
or provided in a plan governed by this Plan, upon termination of employment (as
determined under criteria established by the committee) or, in the case of a director,
service as a director during the applicable restriction period, all shares of restricted
stock and all restricted stock units at such time subject to restriction shall be
forfeited and reacquired by the Company; provided, however, that the committee may, when
it finds that a waiver would be in the best interest of the Company, waive in whole or in
part any or all remaining restrictions with respect to shares of restricted stock or
restricted stock units. Any share representing restricted stock that is no longer subject
to restrictions shall be delivered to the holder thereof promptly after the applicable
restrictions lapse or are waived. Upon the lapse or waiver of restrictions and the
restricted period relating to restricted stock units evidencing the right to receive
shares, such shares shall be issued and delivered to the holders of the restricted stock
units, subject to the provisions of the plan and any applicable award agreement.  

                (d)            Performance
Awards.   The committee is hereby authorized to grant performance awards to participants which may be
“qualified performance-based compensation” within the meaning of Section 162(m). A performance award
granted under the plan may be payable in cash or in shares (including, without limitation, restricted stock and
restricted stock units). Performance awards shall, to the extent required by Section 162(m), be conditioned solely
on the achievement of one or more objective performance goals, and such performance goals shall be established by the
committee within the time period prescribed by, and shall otherwise comply with the requirements of,
Section 162(m). Subject to the terms of the plan and any applicable award agreement, the performance goals to be
achieved during any performance period, the length of any performance period, the amount of any performance award
granted, the amount of any payment or transfer to be made pursuant to any performance award, and any other terms and
conditions of any performance award shall be determined by the committee. Notwithstanding any other provision of the
plan to the contrary, the following additional requirements shall apply to all performance awards made to any
participant under the plan: 

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	  	  	  	(i)  	  	Shareholder
Approval of Plan.   Any performance award that is intended to be “qualified
performance-based compensation” within the meaning of Section 162(m) shall be
null and void and have no effect whatsoever unless the plan, as amended, shall have been
approved by the shareholders of the Company at the Company’s 2004 annual meeting of
shareholders. No performance award shall be granted more than five years after the date
of such meeting of shareholders unless the shareholders have re-approved the plan to the
extent required by Section 162(m).  

	  	  	  	(ii)  	  	Business
Criteria.   Unless and until the committee proposes for shareholder
approval and the Company’s shareholders approve a change in the general business
criteria set forth in this section, the attainment of which may determine the amount
and/or vesting with respect to performance awards, the business criteria to be used for
purposes of establishing performance goals for such performance awards shall be selected
from among the following alternatives, each of which may be based on absolute standards
or comparisons versus specified companies or groups of companies and may be applied at
individual or various organizational levels (e.g., the Company as a whole or
identified business units, segments or the like): sales values, margins, volume, cash
flow, stock price, market share, revenue, sales, earnings per share, profits, earnings
before interest expense and taxes, earnings before interest expense, interest income and
taxes, earnings before interest expense, taxes, and depreciation and/or amortization,
earnings before interest expense, interest income, taxes, and depreciation and/or
amortization, return on equity or costs, return on invested or average capital employed,
economic value, or cumulative total return to shareholders.  

	  	  	  	(iii)  	  	Target
Award; Maximum Amount Payable.   The target award shall be a dollar
amount or a percentage of a participant’s annualized base salary, which may be
greater or less than 100%, as determined by the committee with respect to each
participant for each performance period. The maximum amount payable pursuant to all
performance awards to any participant in the aggregate in any calendar year is specified
in Section 4(d)(ii) of the plan.  

	  	  	  	(iv)  	  	Payment
of Performance Awards.   Performance awards shall be paid no later
than six months following the conclusion of the applicable performance period. The
committee may, in its discretion, reduce the amount of a payout otherwise to be made in
connection with a performance award, but may not exercise discretion to increase such
amount.  

	  	  	  	(v)  	  	Certain
Events.   If a participant dies, becomes permanently and totally
disabled or otherwise terminates employment with the approval of the committee before the
end of a performance period or after the performance period and before a performance
award is paid, the committee may, in its discretion, determine that the participant shall
be paid a pro rated portion of the award that the participant would have received but for
such death, disability or other approved termination of employment.  

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	  	  	  	(vi)  	  	 Designations.   For
a performance award, the committee shall, not later than 90 days after the beginning of
each performance period, (A) designate all participants for such performance period,
(B) establish the objective performance goals for each participant for that
performance period on the basis of one or more of the criteria set forth in (ii) above
and (C) determine target awards for each participant.  

	  	  	  	(vii)  	  	 Certification.   Following
the close of each performance period and prior to payment of any amount to a participant
with respect to a performance award, the committee shall certify in writing as to the
attainment of all goals (including the performance goals for a participant) upon which
any payments to a Participant for that performance period are to be based.  

                (e)            Dividend
Equivalents.   The committee is hereby authorized to grant to participants dividend equivalents under
which such participants shall be entitled to receive payments (in cash, shares, other securities, other awards or other
property as determined in the discretion of the committee) equivalent to the amount of cash dividends paid by the
Company to holders of shares with respect to a number of shares determined by the committee. Subject to the terms of the
plan and any applicable award agreement, such dividend equivalents may have such terms and conditions as the committee
shall determine. 

                (f)            Other
Stock-based Awards.   The committee is hereby authorized to grant to participants such other awards
that are denominated or payable in, valued in whole or in part by reference to, or otherwise based on or related to,
shares (including, without limitation, securities convertible into shares), as are deemed by the committee to be
consistent with the purpose of the plan; provided, however, that such grants must comply with Rule 16b-3 and
applicable law. Subject to the terms of the plan and any applicable award agreement, the committee shall determine the
terms and conditions of such awards. Shares or other securities delivered pursuant to a purchase right granted under
this Section 6(f) shall be purchased for such consideration, which may be paid by such method or methods and in
such form or forms (including, without limitation, cash, shares, promissory notes, other securities, other awards or
other property or any combination thereof), as the committee shall determine, the value of which consideration, as
established by the committee, shall not be less than 100 percent of the fair market value of such shares or other
securities as of the date such purchase right is granted. 

                (g)            General 

	  	  	  	(i)  	  	No
Cash Consideration for Awards.   Awards shall be granted for no cash
consideration or for such minimal cash consideration as may be required by applicable
law.  

	  	  	  	(ii)  	  	Awards
May Be Granted Separately or Together.   Awards may, in the discretion
of the committee, be granted either alone or in addition to, in tandem with, or in
substitution for any other award or any award granted under any plan of the Company or
any affiliate other than the plan. Awards granted in addition to or in tandem with other
awards or in addition to or in tandem with awards granted under any such other plan of
the Company or any affiliate, may be granted either at the same time as or at a different
time from the grant of such other award or awards.  

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	  	  	  	(iii)  	  	Forms
of Payments Under Awards.   Subject to the terms of the plan and of
any applicable award agreement, payments or transfers to be made by the Company or an
affiliate upon the grant, exercise or payment of an award may be made in such form or
forms as the committee shall determine (including, without limitation, cash, shares,
promissory notes, other securities, other awards or other property or any combination
thereof), and may be made in a single payment or transfer, in installments or on a
deferred basis, in each case in accordance with rules and procedures established by the
committee. Such rules and procedures may include, without limitation, provisions for the
payment or crediting of reasonable interest on installment or deferred payments or the
grant or crediting of dividend equivalents with respect to installment or deferred
payments.  

	  	  	  	(iv)  	  	Limits
on Transfer of Awards.   No award and no right under any such award
shall be transferable by a participant otherwise than by will or by the laws of descent
and distribution; provided, however, that if so determined by the committee, a
participant may, in the manner established by the committee, (x) designate a
beneficiary or beneficiaries to exercise the rights of the participant and receive any
property distributable with respect to any award upon the death of the participant, or (y) transfer
an award (other than an incentive stock option) to any member of such participant’s
“immediate family” (as such term is defined in Rule 16a-1(e) promulgated
by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as
amended, or any successor rule or regulation) or to a trust whose beneficiaries are
members of such participant’s “immediate family.” Each award or right
under any award shall be exercisable during the participant’s lifetime only by the
participant, or by a member of such participant’s immediate family or a trust for
members of such immediate family pursuant to a transfer as described above, or if
permissible under applicable law, by the participant’s guardian or legal
representative. No award or right under any such award may be pledged, alienated,
attached or otherwise encumbered, and any purported pledge, alienation, attachment or
encumbrance thereof shall be void and unenforceable against the Company or any affiliate.  

	  	  	  	(v)  	  	Term
of Awards.   The term of each award shall be for such period, not
longer than 10 years from the date of grant, as may be determined by the committee.  

	  	  	  	(vi)  	  	Restrictions;
Securities Exchange Listing.   All certificates for shares or other
securities delivered under the plan pursuant to any award or the exercise thereof shall
be subject to such stop transfer orders and other restrictions as the committee may deem
advisable under the plan or the rules, regulations and other requirements of the
Securities and Exchange Commission and any applicable federal or state securities laws,
and the committee may cause a legend or legends to be placed on any such certificates to
make appropriate reference to such restrictions. If the shares or other securities are
traded on a securities exchange, the Company shall not be required to deliver any shares
or other securities covered by an award unless and until such shares or other securities
have been admitted for trading on such securities exchange.  

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	  	  	  	(vii)  	  	Attestation.   Where
the plan or any applicable award agreement provides for or permits delivery of shares by
a participant in payment with respect to any award or grant under this plan or for taxes,
such payment may be made constructively through attestation in the discretion of and in
accordance with rules established by the committee.  

Section 7.    Awards to Non-employee Directors. 

                (a)            Eligibility;
One-Time Award.   In addition to other awards that may be granted to non-employee directors pursuant
to Section 6 of the plan, each member of the board of directors who is not an employee of the Company or of any
affiliate of the Company (a non-employee director) who is elected to the board subsequent to December 31, 2000 shall,
upon the date of his or her initial election to the board, receive an award of 1,000 shares of restricted stock. These
shares shall vest in three equal installments, on the dates of the annual shareholder meeting in each of the three
succeeding years, if such director remains in office immediately following such meeting. In the event that in accordance
with the Company’s policy with respect to mandatory retirement of directors, any director is not nominated for
election to serve as a director of the Company, all restricted stock so awarded shall immediately vest in full upon such
director’s retirement from the board. If a director ceases to be a director prior to the date on which the award is
fully vested for any reason other than mandatory retirement, any unvested portion of the award shall terminate and be
irrevocably forfeited. Such awards shall be subject to Sections 6(c), 9 and 10 of this plan. The authority of the
committee under this Section 7(a) shall be limited to ministerial and non-discretionary matters. 

                (b)            Annual
Stock Option Grants.   Each non-employee director also shall be eligible to receive non-qualified
stock options under the terms of Section 6(a) of the plan; provided, however, that no such director shall be eligible to
receive more than 5,000 options (exclusive of reload options) in any calendar year, and that all such options shall be
subject in all material respects to the same terms, conditions, and restrictions attached to options then being granted
to executive officers of the Company. 

                (c)            Stock
Compensation.   Each non-employee director shall be eligible to receive or elect to receive his or
her fees for service on the Company’s board of directors and the committees thereof in shares or restricted stock
units and to defer the receipt of such units, all as described in the Deluxe Corporation Non-Employee Director Stock and
Deferral Plan attached hereto as Annex I and hereby made a part hereof. 

Section 8.    Amendment and Termination; Adjustments. 

        Except
to the extent prohibited by applicable law and unless otherwise expressly provided in an
award agreement or in the plan:  

                (a)            Amendments
to the Plan.   The board of directors of the Company may amend, alter, suspend, discontinue or
terminate the plan; provided, however, that, notwithstanding any other provision of the plan or any award agreement,
without the approval of the shareholders of the Company, no such amendment, alteration, suspension, discontinuation or
termination shall be made that: 

11 

	  	  	  	(i)  	  	would
amend section 4(a), 4(d) or 6(a)(i) of the plan;  

	  	  	  	(ii)  	  	 absent
such approval, would violate the rules or regulations of the New York Stock Exchange, any
other securities exchange or the National Association of Securities Dealers, Inc., that
are applicable to the Company; or  

	  	  	  	(iii)  	  	absent
such approval, would cause the Company to be unable, under the Code, to grant incentive
stock options under the plan.  

        The board of
directors shall be entitled to delegate to the committee the power to amend such terms of the plan and for such purposes
as the board of directors shall from time to time determine. 

                (b)            Waivers.
The committee may waive any conditions of or rights of the Company under any outstanding award, prospectively or
retroactively. 

                (c)            Limitations
on Amendments.   Neither the committee nor the Company may amend, alter, suspend, discontinue or
terminate any outstanding award, prospectively or retroactively, without the consent of the participant or holder or
beneficiary thereof, except as otherwise provided herein or in the award agreement. 

                (d)            Correction
of Defects, Omissions and Inconsistencies.   The committee may correct any defect, supply any
omission or reconcile any inconsistency in the plan or any award in the manner and to the extent it shall deem desirable
to carry the plan into effect. 

Section 9.    Income Tax Withholding. 

        In
order to comply with all applicable federal or state income tax laws or regulations, the
committee may establish such policy or policies as it deems appropriate with respect to
such laws and regulations, including without limitation the establishment of policies to
ensure that all applicable federal or state payroll, withholding, income or other taxes,
which are the sole and absolute responsibility of a participant, are withheld or
collected from such participant. In order to assist a participant in paying all or a
portion of the federal and state taxes to be withheld or collected upon exercise or
receipt of (or the lapse of restrictions relating to) an award, the committee, in its
discretion and subject to such additional terms and conditions as it may adopt, may
permit the participant to satisfy such tax obligation by (i) electing to have the Company
withhold a portion of the payment or transfer otherwise to be made upon exercise or
receipt of (or the lapse of restrictions relating to) such award with a fair market value
equal to the amount of such taxes or (ii) delivering to the Company shares or other
property other than shares issuable upon exercise or receipt of (or the lapse of
restrictions relating to) such award with a fair market value equal to the amount of such
taxes. The election, if any, must be on or before the date that the amount of tax to be
withheld is determined.  

Section 10.    General Provisions. 

                (a)            No
Rights to Awards.   No eligible person, participant or other person shall have any claim to be
granted any award under the plan, and there is no obligation for uniformity of treatment of eligible persons,
participants or holders or beneficiaries of awards under the plan. 

12 

The terms and conditions of awards need not be the same with
respect to any participant or with respect to different participants. 

                (b)            Award
Agreements.   No participant will have rights under an award granted to such participant unless and
until an award agreement shall have been duly executed on behalf of the Company and, if requested by the Company, signed
by the participant. 

                (c)            No
Limit on Other Compensation Arrangements.   Nothing contained in the plan shall prevent the Company
or any affiliate from adopting or continuing in effect other or additional compensation arrangements, and such
arrangements may be either generally applicable or applicable only in specific cases. 

                (d)            No
Right to Employment.   The grant of an award shall not be construed as giving a participant the right
to be retained in the employ of the Company or any affiliate, nor will it affect in any way the right of the Company or
the affiliate to terminate such employment at any time, with or without cause. In addition, the Company or an affiliate
may at any time dismiss a participant from employment free from any liability or any claim under the plan, unless
otherwise expressly provided in the plan or in any award agreement. 

                (e)            Governing
Law.   The validity, construction and effect of the plan or any award, and any rules and regulations
relating to the plan or any award, shall be determined in accordance with the laws of the State of Minnesota.

                (f)            Severability.   If
any provision of the plan or any award is or becomes or is deemed to be invalid, illegal or unenforceable in any
jurisdiction or would disqualify the plan or any award under any law deemed applicable by the committee, such provision
shall be construed or deemed amended to conform to applicable laws, or if it cannot be so construed or deemed amended
without, in the determination of the committee, materially altering the purpose or intent of the plan or the award, such
provision shall be stricken as to the plan or such jurisdiction or award, and the remainder of the plan or any such
award shall remain in full force and effect. 

                (g)            No
Trust or Fund Created.   Neither the plan nor any award shall create or be construed to create a
trust or separate fund of any kind or a fiduciary relationship between the Company or any affiliate and a participant or
any other person. To the extent that any person acquires a right to receive payments from the Company or any affiliate
pursuant to an award, such right shall be no greater than the right of any unsecured general creditor of the Company or
any affiliate. 

                (h)            No
Fractional Shares.   No fractional shares shall be issued or delivered pursuant to the plan or any
award, and the committee shall determine whether cash shall be paid in lieu of any fractional shares or whether such
fractional shares or any rights thereto shall be canceled, terminated or otherwise eliminated. 

                (i)            Headings.   Headings
are given to the sections and subsections of the plan solely as a convenience to facilitate reference. Such headings
shall not be deemed in any way material or relevant to the construction or interpretation of the plan or any provision
thereof. 

13 

                (j)            Other
Benefits.   No compensation or benefit awarded to or realized by any participant under the plan shall
be included for the purpose of computing such participant’s compensation under any compensation-based retirement,
disability, or similar plan of the Company unless required by law or otherwise provided by such other plan. 

Section 11.   Effective Date of the Plan. 

        The plan shall be
effective as of January 1, 2001, subject to approval by the shareholders of the Company. 

Section 12.   Term of the Plan. 

        Unless the plan
shall have been discontinued or terminated as provided in Section 8(a), the plan shall terminate on December 31, 2008.
No award shall be granted after the termination of the plan. However, unless otherwise expressly provided in the plan or
in an applicable award agreement, any award theretofore granted may extend beyond the termination of the plan, and the
authority of the committee provided for hereunder with respect to the plan and any awards, and the authority of the
board of directors of the Company to amend the plan, shall extend beyond the termination of the plan. 

14 

ANNEX I 

DELUXE CORPORATION

NON-EMPLOYEE DIRECTOR STOCK AND DEFERRAL PLAN

(“PLAN”) 

                1.           Purpose
of the Plan.   The purpose of the Deluxe Corporation Non-Employee Director Stock and Deferral Plan
(the “Plan”) is to provide an opportunity for non-employee members of the Board of Directors (the
“Board”) of Deluxe Corporation (“Deluxe” or the “Company”) to increase their ownership of
Deluxe Common Stock, $1.00 par value (“Common Stock”), and thereby align their interest in the long-term
success of the Company with that of the other shareholders. This will be accomplished by allowing each participating
director to elect voluntarily to receive all or a portion of his or her Retainer (as hereinafter defined) in the form of
shares of Common Stock and to allow each of them to defer the receipt of such shares until a later date pursuant to
elections made by him or her under this Plan. 

                2.           Eligibility.   Directors
of the Company who are not also officers or other employees of the Company or its subsidiaries are eligible to
participate in this Plan (“Eligible Directors”). 

                3.           Administration.   This
Plan will be administered by or under the direction of the Secretary of the Company (the “Administrator”).
Since the issuance of shares of Common Stock pursuant to this Plan is based on elections made by Eligible Directors, the
Administrator’s duties under this Plan will be limited to matters of interpretation and administrative oversight.
All questions of interpretation of this Plan will be determined by the Administrator, and each determination,
interpretation or other action that the Administrator makes or takes pursuant to the provisions of this Plan will be
conclusive and binding for all purposes and on all persons. The Administrator will not be liable for any action or
determination made in good faith with respect to this Plan. 

                4.           Election
to Receive Stock and Stock Issuance. 

                4.1.       Election
to Receive Stock in Lieu of Cash.   On forms provided by the Company and approved by the
Administrator, each Eligible Director may irrevocably elect (“Stock Election”) to receive, in lieu of cash,
shares of Common Stock having a Fair Market Value, as defined in Section 4.6, equal to 50% or more of the annual cash
retainer and all meeting fees (including all committee retainers and meeting fees, the “Retainer”) payable to
that director for services rendered as a director. From and after January 1, 2001, all Eligible Directors will be deemed
to have made such a Stock Election to receive shares of Common Stock with respect to no less than 50% of such Retainer
and shall be deemed to be a participating director under this Plan (“Participating Director”) to at least such
extent. Except as provided in the preceding sentence, to be effective, any Stock Election must be filed with the Company
(the date of such filing being the date of such election) no later than May 31 of each year (or by such other date as
the Administrator shall determine) and shall apply only with respect to services as a director provided for the period
of July 1 of that year through June 30 of the year following (“Fiscal 

15 

Year”); provided, however, that an Eligible Director whose
initial election to the Board of Directors occurs after May 31, shall have 30 days following such election to make a
Stock Election, which shall apply only with respect to services as a director provided following the filing of such
Stock Election with the Company during the then current or the ensuing Fiscal Year, as specified in the Stock Election.
Following the implementation of the Plan upon the expiration of the existing Deluxe Corporation Non-Employee Director
Stock and Deferral Plan, effective as of October 31, 1997, Eligible Directors shall continue to be bound by the
Stock Elections previously made by them for the Fiscal Year ending June 30, 2001 with respect to their services as
a director during the period from January 1, 2001 through June 30, 2001. In the event that an Eligible
Director shall fail to file with the Company the required form for making a Stock Election, such director shall be
deemed to have made the same Stock Election that such director made with respect to the then current Fiscal Year, or in
the absence of having made such Stock Election, to have elected to receive 50% of his or her Retainer in cash and 50% in
Common Stock, and such election will be deemed to have been made on (i) May 31 in any year with respect to the
ensuing Fiscal Year as aforesaid and (ii) the thirtieth day following initial election to the Board of new
directors with respect to the current Fiscal Year only unless such date is within the period of May 31 through
June 30 of that Fiscal Year, in which event the election shall be deemed made for both the current and next
following Fiscal Years. Any Stock Election made in accordance with the provisions of this Section 4.1 shall be
irrevocable for the period to which such election applies. 

                4.2.       Issuance
of Stock in Lieu of Cash.   Shares of Deluxe Common Stock having a Fair Market Value equal to the
amount of the Retainer so elected shall (i) be issued to each Participating Director or (ii) at the Participating
Director’s election pursuant to Section 4.3, be credited to such director’s account (a “Deferred
Stock Account”), on March 15, June 15, September 15 and December 15 for the calendar quarter
ending on the last day of each such month (each such payment date, a “Payment Date”). The Company shall not
issue fractional shares. Whenever, under the terms of this Plan, a fractional share would be required to be issued, the
Company will round the number of shares (up or down) to the nearest integer. In the event that a Participating Director
elects to receive less than 100% of each quarterly installment of the Retainer in shares of Common Stock (or Stock Units
as defined and provided in Section 4.4), that Participating Director shall receive the balance of the quarterly
installment in cash. 

                4.3.       Manner
of Making Deferral Election.   A Participating Director may elect to defer payment of the Retainer
otherwise payable in shares of Common Stock pursuant to this Plan by filing (the date of such filing being the date of
such election), no later than May 31 of each year (or by such other date as the Administrator shall determine) with
respect to payments in the ensuing Fiscal Year, an irrevocable election with the Administrator on a form (the
“Deferral Election Form”) provided by the Administrator for that purpose (“Deferral Election”). Any
portion of the Retainer to be paid in cash may not be deferred pursuant to the Plan. The special Stock Election rules
set forth in Section 4.1 with respect to new directors and continuing elections under the Plan during 2001 shall
also apply to the corresponding Deferral Elections. Failure timely to file a Deferral Election shall conclusively be
deemed to mean that no election to defer has been made for the applicable period. The Deferral Election shall be
effective for the Retainer payable (i) during the ensuing Fiscal Year with respect to elections made on or before
May 31 of each year as aforesaid and (ii) for the portion of the Fiscal Year after the date the Deferral
Election is made or the ensuing Fiscal Year as specified in the Deferral Election with 

16 

respect to Deferral Elections made by new directors. Any Deferral
Election made in accordance with the provisions of this Section shall be irrevocable for the period to which such
election applies. The Deferral Election form shall specify the amount to be deferred expressed as a percentage of the
Participating Director’s Retainer. 

                4.4.       Credits
to Deferred Stock Account for Elective Deferrals.   On each Payment Date, a Participating Director
who has made a then effective Deferral Election shall receive a credit in the form of restricted stock units
(“Stock Units”) to his or her Deferred Stock Account. Each Stock Unit shall represent the right to receive one
share of Common Stock. The number of Stock Units credited to a Participating Director’s Deferred Stock Account
shall be determined by dividing an amount equal to the Participating Director’s Retainer payable on the Payment
Date for the current calendar quarter and specified for deferral pursuant to Section 4.3, by the Fair Market Value of a
share of Common Stock on such Payment Date. If that computation would result in a fractional Stock Unit being credited
to a Participating Director’s Deferred Stock Account, the Company will round the number of Stock Units so credited
(up or down) to the nearest integer. 

                4.5.       Dividend
Equivalent Payments.   Each time a dividend is paid on the Common Stock, the Participating Director
who has a Deferred Stock Account shall receive a dividend equivalent payment on the dividend payment date equal to the
amount of the dividend payable on a single share of Common Stock multiplied by the number of Stock Units credited to the
Participating Director’s Deferred Stock Account on the dividend record date. 

                4.6.       Fair
Market Value.   The Fair Market Value of each share of Common Stock shall be equal to the closing
price of one share of Common Stock on the New York Stock Exchange (“NYSE”) on the relevant date as reported by
the Wall Street Journal, Midwest Edition; provided that if, on such date, the NYSE is not open for business or
there are no shares of Common Stock traded on such date, the Fair Market Value of a share of Common Stock shall be equal
to the closing price of one share of Common Stock on the first day preceding such date on which the NYSE is open for
business and has reported trades in the Common Stock. 

                4.7.       Termination
of Service as a Director.   If a Participating Director leaves the Board before the conclusion of any
quarter of a Fiscal Year, he or she will be paid the quarterly installment of the Retainer entirely in cash or Common
Stock on the applicable Payment Date in accordance with such Participating Director’s then effective Stock
Election, notwithstanding that a Deferral Election is on file with the Company. The date of termination of a
Participating Director’s service as a director of the Company will be deemed to be the date of termination recorded
on the personnel or other records of the Company. 

                5.           Shares
Available for Issuance.   This Plan constitutes part of the Deluxe Corporation 2000 Stock Incentive
Plan, as amended from time to time (the “SIP”), and is subject to the terms and conditions of the SIP. Any
shares of Common Stock issued under this Plan shall be issued pursuant to the terms and conditions of the SIP, and any
such shares so issued shall be subject to the limits set forth in the SIP, including, without limiting the generality of
the foregoing, the limits contained in Section 4(a) of the SIP. 

17 

                6.           Deferral Payment.  

                6.1.       Deferral
Payment Election.   At the time of making the Deferral Election and as a part thereof, each
Participating Director shall make and file with the Company, a deferral payment election on the Deferral Election Form
specifying one of the payment options described in Section 6.2. If a Participating Director fails to make a
deferral payment election at the time any Deferral Election is made in accordance with this Plan, the Participating
Director shall conclusively be deemed to have elected to receive the Common Stock represented by the Stock Units earned
during the period covered by the Deferral Election in a lump sum payment at the time of the Participating
Director’s termination of service on the Board as provided in Section 6.2. The deferral payment election shall be
irrevocable as to all amounts credited to the Participating Director’s Deferred Stock Account during the period
covered by the relevant Deferral Election. 

                6.2.       Payment
of Deferred Stock Accounts in a Lump Sum.   Stock Units credited to a Participating Director’s
Deferred Stock Account shall be converted to an equal number of shares of Common Stock and issued in full to the
Participating Director on the earlier of the tenth anniversary of February 1 of the year following the Participating
Director’s termination of service on the Board (or the first business day thereafter) or such other date as elected
by the Participating Director by making a deferral payment election in accordance with the provisions of Section 6.1.
All payments shall be made in whole shares of Common Stock (rounded as necessary to the nearest integer).
Notwithstanding the foregoing, in the event of a Change of Control (as defined in Section 12), Stock Units credited to a
Participating Director’s Deferred Stock Account as of the business day immediately prior to the effective date of
the transaction constituting the Change of Control shall be converted to an equal number of shares of Common Stock
(rounded as necessary to the nearest integer) and issued in full to the Participating Director in whole shares of Common
Stock on such date. 

                6.3.       Payment
to Estate.   In the event that a Participating Director shall die before full distribution of his or
her Deferred Stock Account, any shares that issue therefrom shall be issued to such Director’s estate or
beneficiaries, as the case may be. 

                7.           Holding
Period.   All shares of Common Stock issued under this Plan, including shares that are issued as a
result of distributions of a Participating Director’s Deferred Stock Account, shall be held by the Participating
Director receiving such shares for a minimum period of six months from the date of issuance or such longer period as may
be required for compliance with Rule 16b-3, as amended or any successor rule (“Rule 16b-3”), promulgated by
the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended (the “Exchange
Act”). The Administrator may, in his or her discretion, require that shares of Common Stock issued pursuant to this
Plan contain a suitable legend restricting trading in such shares during such holding period 

                8.           Limitation
on Rights of Eligible and Participating Directors. 

                8.1.       Service
as a Director.   Nothing in this Plan will interfere with or limit in any way the right of the
Company’s Board or its shareholders not to nominate for re-election, elect or remove an Eligible or Participating
Director from the Board. Neither this Plan nor any action taken pursuant to it will constitute or be evidence of any
agreement or understanding, express or 

18 

implied, that the Company or its Board or shareholders have
retained or will retain an Eligible or Participating Director for any period of time or at any particular rate of
compensation. 

                8.2.       Nonexclusivity
of the Plan.   Nothing contained in this Plan is intended to affect, modify or rescind any of the
Company’s existing compensation plans or programs or to create any limitations on the power of the Company’s
officers or Board to modify or adopt compensation arrangements as they or it may from time to time deem necessary or
desirable. 

                9.           Plan
Amendment, Modification and Termination.   The Board may suspend or terminate this Plan at any time.
The Board may amend this Plan from time to time in such respects as the Board may deem advisable in order that this Plan
will conform to any change in applicable laws or regulations or in any other respect that the Board may deem to be in
the Company’s best interests; provided, however, that no amendments to this Plan will be effective without approval
of the Company’s shareholders, if shareholder approval of the amendment is then required to exempt issuance or
crediting of shares of Common Stock or Stock Units from Section 16 of the Exchange Act under Rule 16b-3, or
pursuant to the rules of the New York Stock Exchange. 

                10.           Effective
Date and Duration of the Plan.   This Plan shall become effective on January 1, 2001and shall
continue, unless terminated by action of the Board, until the expiration or termination of the SIP, provided that the
expiration or termination of this Plan shall not affect any rights of Participating Directors with respect to their
Deferral Accounts which shall continue to be governed by the provisions of this Plan until the final distribution of all
Deferral Accounts established under this Plan. 

                11.           Participants
are General Creditors of the Company.   The Participating Directors and beneficiaries thereof shall
be general, unsecured creditors of the Company with respect to any payments to be made pursuant to this Plan and shall
not have any preferred interest by way of trust, escrow, lien or otherwise in any specific assets of the Company. If the
Company shall, in fact, elect to set aside monies or other assets to meet its obligations hereunder (there being no
obligation to do so), whether in a grantor’s trust or otherwise, the same shall, nevertheless, be regarded as a
part of the general assets of the Company subject to the claims of its general creditors, and neither any Participating
Director nor any beneficiary thereof shall have a legal, beneficial or security interest therein. 

                12.           Change
of Control.   A “Change of Control” shall be deemed to have occurred if the conditions set
forth in any one of the following paragraphs shall have been satisfied: 

                                A.            Any
Person (other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company) is or
becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities
beneficially owned by such Person any securities acquired directly from the Company or its Affiliates) representing 25%
or more of the combined voting power of the Company’s then outstanding securities; or 

                                B.            During
the period from the effective date of this Plan until final distribution to all
Participating Directors of their Deferred Stock Accounts, individuals who at the
beginning of such period constitute the Board and any new director (other than a director
designated by a Person who has acquired securities of the Company or entered into an
agreement  

19 

with the Company to effect a transaction constituting a Change of
Control as described in paragraphs (A), (C) or (D) of this Section 12) whose election by the Board or nomination
for election by the Company’s shareholders was approved by a vote of at least two-thirds (2/3) of the directors
then still in office who either were directors at the beginning of the period or whose election or nomination for
election was previously so approved, cease for any reason to constitute a majority thereof; or 

                                C.            The
shareholders of the Company approve a merger or consolidation of the Company with any other corporation, other than
(a) a merger or consolidation which would result in the voting securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of
the surviving entity), in combination with the ownership of any trustee or other fiduciary holding securities under an
employee benefit plan of the Company, at least 51% of the combined voting power of the voting securities of the Company
or such surviving entity outstanding immediately after such merger or consolidation, or (b) a merger or
consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Person
acquires more than 40% of the combined voting power of the Company’s then outstanding securities; or 

                                D.            The
shareholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all the Company’s assets.  

                                E.            For
the purposes of this Section 12, the following terms shall have definitions ascribed herein to them: 

	  	  	  	(i)  	  	“Person” shall have the meaning defined in
Sections 3(a)(9) and 13(d) of the Securities Exchange. 

	  	  	  	(ii)  	  	“Beneficial Owner” shall have the meaning
defined in Rule 13d-3 promulgated under the Exchange Act. 

	  	  	  	(iii)  	  	“Affiliate” shall mean a company controlled
directly or indirectly by the Company, where “control” shall mean the right, either directly or indirectly, to
elect a majority of the directors thereof without the consent or acquiescence of any third party. 

                13.          Miscellaneous.  

                13.1.        Securities Law and Other Restrictions.   Notwithstanding
any other provision of this Plan or any Stock Election or Deferral Election delivered pursuant to this Plan, the Company
will not be required to issue any shares of Common Stock under this Plan and a Participating Director may not sell,
assign, transfer or otherwise dispose of shares of Common Stock issued pursuant to this Plan, unless (a) there is in
effect with respect to such shares a registration statement under the Securities Act of 1933, as amended (the
“Securities Act”) and any applicable state securities laws or an exemption from such registration under the
Securities Act and applicable state securities laws, and (b) there has been obtained any other consent, approval or
permit from any other regulatory body that the Administrator, in his or her sole discretion, deems necessary or
advisable. The Company may condition such issuance, sale or transfer upon the 

20 

receipt of any representations or agreements from the parties
involved, and the placement of any legends on certificates representing shares of Common Stock, as may be deemed
necessary or advisable by the Company, in order to comply with such securities law or other restriction. 

                13.2.       Governing
Law.   The validity, construction, interpretation, administration and effect of this Plan and any
rules, regulations and actions relating to this Plan will be governed by and construed exclusively in accordance with
the laws of the State of Minnesota. 

21Exibit 4.A to Woodhead Industries, Inc. Form 10-Q, June 26, 2004

EXHIBIT 4  

CREDIT AGREEMENT 

DATED AS OF 

APRIL 28, 2004 

BETWEEN 

WOODHEAD INDUSTRIES,
INC. 

AND 

HARRIS TRUST AND
SAVINGS BANK 

TABLE OF CONTENTS 

	SECTION	DESCRIPTION	PAGE
	 
	SECTION 1	THE CREDITS	1 
	 
	       Section 1.1.	Revolving Credit	1 
	       Section 1.2.	Loans	1 
	       Section 1.3.	Letters of Credit	1 
	       Section 1.4.	Manner and Disbursement of Loans	2 
	       Section 1.5.	Extensions of the Commitment	3 
	 
	SECTION 2	INTEREST AND CHANGE IN CIRCUMSTANCES	3 
	 
	       Section 2.1.	Interest Rate Options	3 
	       Section 2.2.	Minimum Amounts	5 
	       Section 2.3.	Computation of Interest	5 
	       Section 2.4.	Manner of Rate Selection	5 
	       Section 2.5.	Change of Law	5 
	       Section 2.6.	Unavailability of Deposits or Inability to Ascertain Adjusted LIBOR	6 
	       Section 2.7.	Taxes and Increased Costs	6 
	       Section 2.8.	Funding Indemnity	7 
	       Section 2.9.	Change in Capital Adequacy Requirements	7 
	       Section 2.10.	Lending Branch	8 
	       Section 2.11.	Discretion of Bank as to Manner of Funding	8 
	 
	SECTION 3	FEES, PREPAYMENTS, TERMINATIONS AND APPLICATIONS	8 
	 
	       Section 3.1.	Fees	8 
	       Section 3.2.	Voluntary Prepayments	9 
	       Section 3.3.	Terminations	9 
	       Section 3.4.	Place and Application of Payments	9 
	       Section 3.5.	Notations	10 
	 
	SECTION 4	GUARANTIES	10 
	 
	SECTION 5	DEFINITIONS; INTERPRETATION	10 
	 
	       Section 5.1.	Definitions	10 
	       Section 5.2.	Interpretation	18 
	 
	SECTION 6	REPRESENTATIONS AND WARRANTIES	18 
	 
	       Section 6.1.	Organization and Qualification	18 
	       Section 6.2.	Subsidiaries	18 
	       Section 6.3.	Corporate Authority and Validity of Obligations	19 
	       Section 6.4.	Use of Proceeds; Margin Stock	19 

 

	 	 	 
	 
	       Section 6.5.	Financial Reports	20 
	       Section 6.6.	No Material Adverse Change	20 
	       Section 6.7.	Full Disclosure	20 
	       Section 6.8.	Trademarks, Franchises and Licenses	20 
	       Section 6.9.	Governmental Authority and Licensing	20 
	       Section 6.10.	Good Title	21 
	       Section 6.11.	Litigation and Other Controversies	21 
	       Section 6.12.	Taxes	21 
	       Section 6.13.	Approvals	21 
	       Section 6.14.	Affiliate Transactions	21 
	       Section 6.15.	Investment Company; Public Utility Holding Company	21 
	       Section 6.16.	ERISA	21 
	       Section 6.17.	Compliance with Laws	22 
	       Section 6.18.	Other Agreements	22 
	       Section 6.19.	Solvency	22 
	       Section 6.20.	No Default	22 
	 
	SECTION 7	CONDITIONS PRECEDENT	22 
	 
	       Section 7.1.	All Advances	22 
	       Section 7.2.	Initial Advance	23 
	       Section 7.3.	Termination of Prior Credit Facilities	24 
	 
	SECTION 8	COVENANTS	24 
	 
	       Section 8.1.	Maintenance of Business	24 
	       Section 8.2.	Maintenance of Properties	24 
	       Section 8.3.	Taxes and Assessments	25 
	       Section 8.4.	Insurance	25 
	       Section 8.5.	Financial Reports	25 
	       Section 8.6.	Inspection	26 
	       Section 8.7.	Borrowings and Guaranties	27 
	       Section 8.8.	Liens	28 
	       Section 8.9.	Investments, Acquisitions, Loans and Advances	29 
	       Section 8.10.	Mergers, Consolidations and Sales	30 
	       Section 8.11.	Maintenance of Subsidiaries	31 
	       Section 8.12.	ERISA	31 
	       Section 8.13.	Compliance with Laws	31 
	       Section 8.14.	Burdensome Contracts With Affiliates	32 
	       Section 8.15.	No Changes in Fiscal Year	32 
	       Section 8.16.	Formation of Subsidiaries	32 
	       Section 8.17.	Change in the Nature of Business	32 
	       Section 8.18.	Use of Proceeds	32 
	       Section 8.19.	No Restrictions	32 
	       Section 8.20.	Financial Covenants	32 
	       Section 8.21.	Immaterial Subsidiaries	33 

-ii- 

	 	 	 
	 
	SECTION 9	EVENTS OF DEFAULT AND REMEDIES	33 
	 
	       Section 9.1.	Events of Default	33 
	       Section 9.2.	Non-Bankruptcy Defaults	35 
	       Section 9.3.	Bankruptcy Defaults	35 
	       Section 9.4.	Collateral for Undrawn Letters of Credit	35 
	 
	SECTION 10	MISCELLANEOUS	35 
	 
	       Section 10.1.	Non-Business Day	35 
	       Section 10.2.	No Waiver, Cumulative Remedies	36 
	       Section 10.3.	Amendments, Etc.	36 
	       Section 10.4.	Costs and Expenses; Indemnification	36 
	       Section 10.5.	Documentary Taxes	37 
	       Section 10.6.	Survival of Representations	37 
	       Section 10.7.	Survival of Indemnities	37 
	       Section 10.8.	Notices	37 
	       Section 10.9.	Construction	37 
	       Section 10.10.	Headings	38 
	       Section 10.11.	Severability of Provisions	38 
	       Section 10.12.	Counterparts	38 
	       Section 10.13.	Binding Nature, Governing Law, Etc.	38 
	       Section 10.14.	Submission to Jurisdiction; Waiver of Jury Trial	38 
	 
	Signature	 	39 
	 
	Exhibit A         —    Revolving Note
	Exhibit B          —    Compliance Certificate
	Schedule 6.2   —    Subsidiaries

-iii- 

CREDIT AGREEMENT 

Harris Trust and Savings
Bank

Chicago, Illinois 

Ladies and Gentlemen: 

        The
undersigned, Woodhead Industries, Inc., a Delaware corporation (the
“Borrower”), applies to you (the “Bank”) for your
commitment, subject to the terms and conditions hereof and on the basis of the
representations and warranties hereinafter set forth, to extend credit to the Borrower,
all as more fully hereinafter set forth. All capitalized terms used herein without
definition shall have the same meanings herein as such terms are defined in
Section 5.1 hereof. 

SECTION 1.    THE CREDITS.  

             Section 1.1.       
          Revolving Credit. Subject to the terms and conditions hereof, the Bank
          agrees to extend a revolving credit (the “Revolving Credit”) to
          the Borrower which may be availed of by the Borrower from time to time during
          the period from and including the date hereof to but not including the
          Termination Date, at which time the commitment of the Bank to extend credit
          under the Revolving Credit shall expire. The Revolving Credit may be utilized by
          the Borrower in the form of Loans and Letters of Credit, all as more fully
          hereinafter set forth, provided that the aggregate principal amount of Loans and
          Letters of Credit outstanding at any one time shall not exceed $25,000,000 (the
          “Commitment”, as such amount may be reduced pursuant to the
          terms hereof). During the period from and including the date hereof to but not
          including the Termination Date, the Borrower may use the Commitment by
          borrowing, repaying, and reborrowing Loans in whole or in part and/or by having
          the Bank issue Letters of Credit, having such Letters of Credit expire or
          otherwise terminate without having been drawn upon or, if drawn upon,
          reimbursing the Bank for each such drawing, and having the Bank issue new
          Letters of Credit, all in accordance with the terms and conditions of this
          Agreement. 

             Section 1.2.       
          Loans. Subject to the terms and conditions hereof, the Revolving Credit
          may be availed of by the Borrower in the form of loans (individually a
          “Loan” and collectively the “Loans”). The
          Loans shall be made against and evidenced by a single promissory note of the
          Borrower in the form (with appropriate insertions) attached hereto as
          Exhibit A (the “Note”). The Note shall be dated the date
          of issuance thereof and be expressed to bear interest as set forth in
          Section 2 hereof. The Note, and all Loans evidenced thereby, shall mature
          and become due and payable in full on the Termination Date. Without regard to
          the principal amount of the Note stated on its face, the actual principal amount
          at any time outstanding and owing by the Borrower on account of the Note shall
          be the sum of all Loans made hereunder less all payments of principal actually
          received by the Bank. 

             Section 1.3.       
          Letters of Credit. 

             (a)       
          General Terms. Subject to the terms and conditions hereof, the Revolving
          Credit may be availed of by the Borrower in the form of standby and commercial
          letters of credit issued 

by the Bank for the account of the
Borrower           (individually a “Letter of Credit” and collectively
the “Letters of Credit”), provided that the aggregate amount of
          Letters of Credit issued and outstanding hereunder shall not at any one time
          exceed $1,000,000. For purposes of this Agreement, a Letter of Credit shall be
          deemed outstanding as of any time in an amount equal to the maximum amount
which           could be drawn thereunder under any circumstances and over any period of
time           plus any unreimbursed drawings then outstanding with respect thereto. If
and to           the extent any Letter of Credit expires or otherwise terminates without
having           been drawn upon, the availability under the Commitment shall to such
extent be           reinstated.  

             (b)       
          Term. Each Letter of Credit issued hereunder shall expire not later than
          the earlier of (i) 12 months from the date of issuance (or be cancelable
          not later than 12 months from the date of issuance and each renewal) or (ii) the
          Termination Date. 

             (c)       
          General Characteristics. Each Letter of Credit issued hereunder shall be
          payable in U.S. Dollars, conform to the general requirements of the Bank for the
          issuance of a standby or commercial letter of credit, as the case may be,
          as to form and substance, and be a letter of credit which the Bank may lawfully
          issue. 

             (d)       
          Applications. At the time the Borrower requests a Letter of Credit to be
          issued (or prior to the first issuance of a Letter of Credit in the case of a
          continuing application), the Borrower shall execute and deliver to the Bank an
          application for such Letter of Credit in the form then customarily prescribed by
          the Bank (individually an “Application” and collectively the
          “Applications”). Subject to the other provisions of this
          subsection, the obligation of the Borrower to reimburse the Bank for drawings
          under a Letter of Credit shall be governed by the Application for such Letter of
          Credit. Anything contained in the Applications to the contrary notwithstanding,
          (i) in the event the Bank is not reimbursed by the Borrower for the amount
          the Bank pays on any drawing made under a Letter of Credit issued hereunder by
          11:00 a.m. (Chicago time) on the date when such drawing is paid, the obligation
          of the Borrower to reimburse the Bank for the amount of such drawing shall bear
          interest (which the Borrower hereby promises to pay on demand) from and after
          the date the drawing is paid by the Bank until repayment in full thereof at the
          fluctuating rate per annum determined by adding 2.0% to the sum of the
          Applicable Margin plus the Base Rate as from time to time in effect (computed on
          the basis of a year of 360 days for the actual number of days elapsed),
          (ii) the Borrower shall pay fees in connection with each Letter of Credit
          as set forth in Section 3 hereof, (iii) prior to the occurrence of a
          Default or an Event of Default, the Bank will not call for the funding of a
          Letter of Credit by the Borrower prior to being presented with a drawing
          thereunder. 

             Section 1.4.       
          Manner and Disbursement of Loans. The Borrower shall give written or
          telephonic notice to the Bank (which notice shall be irrevocable once given and,
          if given by telephone, shall be promptly confirmed in writing) by no later than
          11:00 a.m. (Chicago time) on the date the Borrower requests the Bank to
          make a Loan hereunder. Each such notice shall specify the date of the Loan
          requested (which must be a Business Day) and the amount of such Loan. Each Loan
          shall initially constitute part of the Base Rate Portion except to the extent
          the Borrower has otherwise timely elected that such Loan, or any part thereof,
          constitute part of a Fixed Rate Portion as provided in Section 2 hereof.
          The Borrower agrees that the Bank may rely upon any written or telephonic notice
          given by any person the Bank in good faith believes is an 

-2- 

Authorized           Representative
without the necessity of independent investigation and, in the           event any
telephonic notice conflicts with the written confirmation, such           telephonic
notice shall govern if the Bank has acted in reliance thereon.           Subject to the
provisions of Section 7 hereof, the proceeds of each Loan           shall be made
available to the Borrower at the principal office of the Bank in           Chicago,
Illinois, in immediately available funds, in the case of the initial           Loans made
hereunder, in accordance with the terms of the written disbursement
          instructions of the Borrower and, in the case of each subsequent Loan, by
          deposit to the Borrower’s operating account no. 452995-4 maintained
          with the Bank or as otherwise agreed upon by the Borrower and the Bank.  

             Section 1.5.       
          Extensions of the Commitment. No less than 30 days prior to, but not more
          than 60 days prior to, the date occurring on the second anniversary of the date
          of this Agreement (and on each anniversary date thereafter in the event the
          Termination Date has heretofore been extended pursuant to this Section), the
          Borrower may advise the Bank in writing of its desire to extend the Termination
          Date for an additional 12-months. In the event that the Bank is agreeable to
          such extension, it shall so notify the Borrower (it being understood that the
          Bank may accept or decline such a request in its sole discretion and on such
          terms as it may elect, and in the event that the Bank fails to so notify the
          Borrower within 30 days of the Borrower’s request that the Bank has agreed
          to such extension the Bank shall be deemed to have refused to grant the request
          extension) and the Borrower and the Bank shall enter into such documents as the
          Bank may deem necessary or appropriate to reflect such extension, and all costs
          and expenses incurred by the Bank in connection therewith (including reasonable
          attorneys’ fees) shall be paid by the Borrower. 

SECTION 2.    INTEREST AND
CHANGE IN CIRCUMSTANCES. 

             Section 2.1.       
          Interest Rate Options. (a) Generally. The outstanding
          principal balance of the Loans (all of the indebtedness evidenced by the Note
          bearing interest at the same rate for the same period of time being hereinafter
          referred to as a “Portion”) shall bear interest with reference
          to the Base Rate (the “Base Rate Portion”) or, at the option of
          the Borrower and subject to the terms and conditions hereof, with reference to
          an Adjusted LIBOR (“LIBOR Portions”) or with reference to an
          Offered Rate (“Offered Rate Portions”). All of the indebtedness
          evidenced by the Note which bears interest with reference to a particular
          Adjusted LIBOR for a particular Interest Period shall constitute a single LIBOR
          Portion, all of the indebtedness evidenced by the Note which bears interest with
          reference to a particular Offered Rate for a particular Interest Period shall
          constitute a single Offered Rate Portion, and all of the indebtedness evidenced
          by the Note which is not part of a Fixed Rate Portion shall constitute a single
          Base Rate Portion. There shall not be more than 10 Fixed Rate Portions
          applicable to the Note outstanding at any one time. Anything contained herein to
          the contrary notwithstanding, the obligation of the Bank to create, continue or
          effect by conversion any Fixed Rate Portion shall be conditioned upon the fact
          that at the time no Default or Event of Default shall have occurred and be
          continuing. The Borrower hereby promises to pay interest on each Portion of the
          Note at the rates and times specified in this Section 2. 

             (b)       
          Base Rate Portion. The Base Rate Portion shall bear interest at the rate
          per annum determined by adding the Applicable Margin to the Base Rate as in
          effect from time to time,

-3- 

provided that if the Base Rate
Portion or any part           thereof is not paid when due (whether by lapse of time,
acceleration, or           otherwise), or at the election of the Bank upon notice to the
Borrower during           the existence of any other Event of Default, such Portion shall
bear interest,           whether before or after judgment until payment in full thereof,
at the rate per           annum determined by adding 2.0% to the interest rate which
would otherwise be           applicable thereto from time to time. Interest on the Base
Rate Portion shall be           payable quarterly in arrears on the last day of each
March, June, September, and           December in each year (commencing on the first such
date occurring after the           date hereof) and at maturity of the Note, and interest
after maturity (whether           by lapse of time, acceleration, or otherwise) shall be
due and payable upon           demand. Any change in the interest rate on the Base Rate
Portion resulting from           a change in the Base Rate shall be effective on the date
of the relevant change           in the Base Rate.  

             (c)       
          LIBOR Portions. Each LIBOR Portion shall bear interest for each Interest
          Period selected therefor at a rate per annum determined by adding the Applicable
          Margin to the Adjusted LIBOR for such Interest Period, provided that if
          any LIBOR Portion is not paid when due (whether by lapse of time, acceleration,
          or otherwise), or at the election of the Bank upon notice to the Borrower during
          the existence of any other Event of Default, such Portion shall bear interest,
          whether before or after judgment until payment in full thereof, through the end
          of the Interest Period then applicable thereto at the rate per annum determined
          by adding 2.0% to the interest rate which would otherwise be applicable thereto,
          and effective at the end of such Interest Period such LIBOR Portion shall
          automatically be converted into and added to the Base Rate Portion and shall
          thereafter bear interest at the interest rate applicable to the Base Rate
          Portion after default. Interest on each LIBOR Portion shall be due and payable
          on the last day of each Interest Period applicable thereto and, with respect to
          any Interest Period applicable to a LIBOR Portion in excess of 3 months, on
          the date occurring every 3 months after the date such Interest Period began
          and at the end of such Interest Period, and interest after maturity (whether by
          lapse of time, acceleration, or otherwise) shall be due and payable upon demand.
          The Borrower shall notify the Bank on or before 11:00 a.m. (Chicago time)
          on the third Business Day preceding the end of an Interest Period applicable to
          a LIBOR Portion whether such LIBOR Portion is to continue as a LIBOR Portion, in
          which event the Borrower shall notify the Bank of the new Interest Period
          selected therefor; and in the event the Borrower shall fail to so notify the
          Bank, such LIBOR Portion shall automatically be converted into and added to the
          Base Rate Portion as of and on the last day of such Interest Period. 

             (d)       
          Offered Rate Portions. Each Offered Rate Portion shall bear interest for
          each Interest Period selected therefor at a rate per annum determined by adding
          the Applicable Margin to the Offered Rate for such Interest Period, provided
          that if any Offered Rate Portion is not paid when due (whether by lapse of time,
          acceleration, or otherwise), or at the election of the Bank upon notice to the
          Borrower during the existence of any Event of Default, such Portion shall bear
          interest, whether before or after judgment until payment in full thereof,
          through the end of the Interest Period then applicable thereto at the rate per
          annum determined by adding 2.0% to the interest rate which would otherwise be
          applicable thereto, and effective at the end of such Interest Period such
          Offered Rate Portion shall automatically be converted into and added to the Base
          Rate Portion and shall thereafter bear interest at the interest rate applicable
          to the Base Rate Portion after default. Interest on each Offered Rate Portion
          shall be due and payable on the last day of each Interest Period applicable
          thereto and, with respect to any Interest Period applicable

-4- 

to an Offered Rate           Portion
in excess of 90 days, on the date occurring every 90 days           after the
date such Interest Period began and at the end of such Interest           Period, and
interest after maturity (whether by lapse of time, acceleration, or           otherwise)
shall be due and payable upon demand. The Borrower shall notify the           Bank on or
before 11:00 a.m. (Chicago time) on the Business Day preceding the           end of an
Interest Period applicable to an Offered Rate Portion whether such           Offered Rate
Portion is to continue as an Offered Rate Portion, in which event           the Borrower
shall notify the Bank of the new Interest Period selected therefor;           and in the
event the Borrower shall fail to so notify the Bank, such Offered           Rate Portion
shall automatically be converted into and added to the Base Rate           Portion as of
and on the last day of such Interest Period. The Borrower           understands and
agrees that the Bank has no obligation to quote Offered Rates or           to make any
Offered Rate Portion available to the Borrower, that the Bank may           refuse to
make any such Offered Rate Portion available to the Borrower after           receiving a
request therefor from the Borrower, and that any such Offered Rate           Portion made
available to the Borrower shall be subject to such other terms and           conditions
as are mutually agreed upon by the Borrower and the Bank.  

             Section 2.2.       
          Minimum Amounts. Unless otherwise agreed to by the Bank, (a) the
          Base Rate Portion shall be in an amount equal to $100,000 or such greater amount
          which is an integral multiple of $25,000 and (b) each Fixed Rate Portion
          shall be in an amount equal to $500,000 or such greater amount which is an
          integral multiple of $100,000. 

             Section 2.3.       
          Computation of Interest. All interest on the Note shall be computed on
          the basis of a year of 360 days for the actual number of days elapsed. 

             Section 2.4.       
          Manner of Rate Selection.  The Borrower shall notify the Bank by
          11:00 a.m. (Chicago time) (i) at least 3 Business Days prior to the
          date upon which the Borrower requests that any LIBOR Portion be created or that
          any part of the Base Rate Portion or any part of an Offered Rate Portion be
          converted into a LIBOR Portion, and (ii) at least 1 Business Day prior
          to the date upon which the Borrower requests that any Offered Rate Portion be
          created or that any part of the Base Rate Portion or any part of a LIBOR Portion
          be converted into an Offered Rate Portion (each such notice to specify in each
          instance the amount thereof and the Interest Period selected therefor). If any
          request is made to convert a Fixed Rate Portion into another type of Portion
          available hereunder, such conversion shall only be made so as to become
          effective as of the last day of the Interest Period applicable thereto. All
          requests for the creation, continuance, and conversion of Portions under this
          Agreement shall be irrevocable. Such requests may be written or oral and the
          Bank is hereby authorized to honor telephonic requests for creations,
          continuances, and conversions received by it from any person the Bank in good
          faith believes to be an Authorized Representative without the necessity of
          independent investigation, the Borrower hereby indemnifying the Bank from any
          liability or loss ensuing from so acting. 

             Section 2.5.       
          Change of Law. Notwithstanding any other provisions of this Agreement or
          the Note, if at any time the Bank shall determine that any change in applicable
          laws, treaties, or regulations, or in the interpretation thereof, makes it
          unlawful for the Bank to create or continue to maintain any Fixed Rate Portion,
          it shall promptly so notify the Borrower and the obligation of the Bank to
          create, continue, or maintain any such Fixed Rate Portion under this Agreement

-5- 

shall be suspended until it is no
longer unlawful for the Bank to create,           continue, or maintain such Fixed Rate
Portion. If the continued maintenance of           any such Fixed Rate Portion is
unlawful, the Borrower shall prepay on demand to           the Bank the outstanding
principal amount of the affected Fixed Rate Portion           together with all interest
accrued thereon and all other amounts payable to the           Bank with respect thereto
under this Agreement; provided, however, the           Borrower may elect to
convert the principal amount of the affected Portion into           another type of
Portion available hereunder, subject to the terms and conditions           of this
Agreement (including, without limitation, Section 2.8 hereof).  

             Section 2.6.       
          Unavailability of Deposits or Inability to Ascertain Adjusted LIBOR.
          Notwithstanding any other provision of this Agreement or the Note, if the Bank
          shall determine prior to the commencement of any Interest Period that
          deposits in the amount of any LIBOR Portion scheduled to be outstanding during
          such Interest Period are not readily available to the Bank in the relevant
          market or, by reason of circumstances affecting the relevant market, adequate
          and reasonable means do not exist for ascertaining Adjusted LIBOR, then the Bank
          shall promptly give notice thereof to the Borrower and the obligations of the
          Bank to create, continue, or effect by conversion any such LIBOR Portion in such
          amount and for such Interest Period shall be suspended until deposits in such
          amount and for the Interest Period selected by the Borrower shall again be
          readily available in the relevant market and adequate and reasonable means exist
          for ascertaining Adjusted LIBOR. 

             Section 2.7.       
          Taxes and Increased Costs. With respect to any Fixed Rate Portion, if the
          Bank shall determine that any change in any applicable law, treaty, regulation,
          or guideline (including, without limitation, Regulation D of the Board of
          Governors of the Federal Reserve System), or any new law, treaty, regulation, or
          guideline, or any interpretation of any of the foregoing, by any governmental
          authority charged with the administration thereof or any central bank or other
          fiscal, monetary, or other authority having jurisdiction over the Bank or its
          lending branch or the Fixed Rate Portions contemplated by this Agreement
          (whether or not having the force of law), shall: 

          		        (i)       
               impose, increase, or deem applicable any reserve, special deposit, or similar
               requirement against assets held by, or deposits in or for the account of, or
               loans by, or any other acquisition of funds or disbursements by, the Bank which
               is not in any instance already accounted for in computing the interest rate
               applicable to such Fixed Rate Portion; 

               

          		        (ii)       
               subject the Bank, any Fixed Rate Portion or the Note to the extent it evidences
               a Fixed Rate Portion to any tax (including, without limitation, any United
               States interest equalization tax or similar tax however named applicable to the
               acquisition or holding of debt obligations and any interest or penalties with
               respect thereto), duty, charge, stamp tax, fee, deduction, or withholding in
               respect of this Agreement, any Fixed Rate Portion or the Note to the extent it
               evidences a Fixed Rate Portion, except such taxes as may be measured by the
               overall net income or gross receipts of the Bank or its lending branches and
               imposed by the jurisdiction, or any political subdivision or taxing authority
               thereof, in which the Bank’s principal executive office or its lending
               branch is located; 

               

-6- 

          		        (iii)       
               change the basis of taxation of payments of principal and interest due from the
               Borrower to the Bank hereunder or under the Note to the extent it evidences any
               Fixed Rate Portion (other than by a change in taxation of the overall net income
               or gross receipts of the Bank); or 

               

          		        (iv)       
               impose on the Bank any penalty with respect to the foregoing or any other
               condition regarding this Agreement, any Fixed Rate Portion, or its disbursement,
               or the Note to the extent it evidences any Fixed Rate Portion; 

               

and the Bank shall
determine that the result of any of the foregoing is to increase the cost (whether by
incurring a cost or adding to a cost) to the Bank of creating or maintaining any Fixed
Rate Portion hereunder or to reduce the amount of principal or interest received or
receivable by the Bank (without benefit of, or credit for, any prorations, exemption,
credits, or other offsets available under any such laws, treaties, regulations,
guidelines, or interpretations thereof), then the Borrower shall pay on demand to the Bank
from time to time as specified by the Bank such additional amounts as the Bank shall
reasonably determine are sufficient to compensate and indemnify it for such increased cost
or reduced amount. If the Bank makes such a claim for compensation, it shall provide to
the Borrower a certificate setting forth the computation of the increased cost or reduced
amount as a result of any event mentioned herein in reasonable detail and such certificate
shall be conclusive if reasonably determined. 

             Section 2.8.       
          Funding Indemnity. In the event the Bank shall incur any loss, cost, or
          expense (including, without limitation, any loss, cost, or expense incurred by
          reason of the liquidation or reemployment of deposits or other funds acquired or
          contracted to be acquired by the Bank to fund or maintain any Fixed Rate Portion
          or the relending or reinvesting of such deposits or other funds or amounts paid
          or prepaid to the Bank) as a result of: 

          		        (i)       
               any payment of a Fixed Rate Portion on a date other than the last day of the
               then applicable Interest Period for any reason, whether before or after default,
               and whether or not such payment is required by any provision of this Agreement;
               or 

               

          		        (ii)       
               any failure by the Borrower to create, borrow, continue, or effect by conversion
               a Fixed Rate Portion on the date specified in a notice given pursuant to this
               Agreement; 

               

then upon the demand of
the Bank, the Borrower shall pay to the Bank such amount as will reimburse the Bank for
such loss, cost, or expense. If the Bank requests such a reimbursement, it shall provide
to the Borrower a certificate setting forth the computation of the loss, cost, or expense
giving rise to the request for reimbursement in reasonable detail and such certificate
shall be conclusive if reasonably determined. 

             Section 2.9.       
          Change in Capital Adequacy Requirements. If the Bank shall determine that
          the adoption after the date hereof of any applicable law, rule, or regulation
          regarding capital adequacy, or any change in any existing law, rule, or
          regulation, or any change in the interpretation or administration thereof by any
          governmental authority, central bank, or comparable agency charged with the
          interpretation or administration thereof, or compliance by

-7- 

the Bank (or any of           its
branches) with any request or directive regarding capital adequacy (whether           or
not having the force of law) of any such authority, central bank, or           comparable
agency, has or would have the effect of reducing the rate of return           on the Bank’s
capital as a consequence of its obligations hereunder or for           the credit which
is the subject matter hereof to a level below that which the           Bank could have
achieved but for such adoption, change, or compliance (taking           into
consideration the Bank’s policies with respect to liquidity and           capital
adequacy) by an amount deemed by the Bank to be material, then from time           to
time, within 15 days after demand by the Bank, the Borrower shall pay to
          the Bank such additional amount or amounts reasonably determined by the Bank as
          will compensate the Bank for such reduction.  

             Section 2.10.       
          Lending Branch. The Bank may, at its option, elect to make, fund or
          maintain Portions of the Loans hereunder at such of its branches or offices as
          the Bank may from time to time elect. To the extent reasonably possible, the
          Bank shall designate an alternate branch or funding office with respect to the
          Fixed Rate Portions to reduce any liability of the Borrower to the Bank under
          Section 2.7 hereof or to avoid the unavailability of an interest rate option
          under Section 2.6 hereof, so long as such designation is not otherwise
          disadvantageous to the Bank. 

             Section 2.11.       
          Discretion of Bank as to Manner of Funding. Notwithstanding any provision
          of this Agreement to the contrary, the Bank shall be entitled to fund and
          maintain its funding of all or any part of the Note in any manner it sees fit,
          it being understood, however, that for the purposes of this Agreement all
          determinations hereunder (including, without limitation, determinations under
          Sections 2.6, 2.7, and 2.8 hereof) shall be made as if the Bank had
          actually funded and maintained each Fixed Rate Portion during each Interest
          Period applicable thereto through the purchase of deposits in the relevant
          market in the amount of such Fixed Rate Portion, having a maturity corresponding
          to such Interest Period, and, in the case of any LIBOR Portion, bearing an
          interest rate equal to the LIBOR for such Interest Period. 

     SECTION 3.    
          FEES, PREPAYMENTS, TERMINATIONS AND APPLICATIONS. 

             Section 3.1.       
          Fees. 

             (a)       
          Commitment Fee. For the period from and including the date hereof to but
          not including the Termination Date, the Borrower shall pay to the Bank a
          commitment fee at the rate per annum equal to the Applicable Margin (computed on
          the basis of a year of 360 days for the actual number of days elapsed) on the
          average daily unused portion of the Commitment. Such commitment fee shall be
          payable quarterly in arrears on the last day of each March,
          June, September and December in each year (commencing on the first such date
          occurring after the date hereof) and on the Termination Date. 

             (b)       
          Letter of Credit Fees. On the date of issuance or extension, or increase
          in the amount, of any standby Letter of Credit pursuant to Section 1.3
          hereof, the Borrower shall pay to the Bank an issuance fee equal to 0.125% of
          the face amount of (or of the increase in the face amount of) such standby
          Letter of Credit. On the last day of each March, June, September, and December
          of each year (commencing on the first such date occurring after the date hereof)
          to and including, and on, the Termination Date, the Borrower shall pay to the
          Bank a letter of credit fee

-8- 

at the rate per annum equal to the
Applicable Margin           (computed on the basis of a year of 360 days for the
actual number of days           elapsed) on the daily average amount of Letters of Credit
outstanding during the           preceding calendar quarter. In addition to the letter of
credit fee called for           above, the Borrower further agrees to pay to the Bank
such issuing, processing,           and transaction fees and charges as the Bank from
time to time customarily           imposes in connection with any issuance, amendment,
cancellation, negotiation,           and/or payment of letters of credit and drafts drawn
thereunder.  

             Section 3.2.       
          Voluntary Prepayments. The Borrower shall have the privilege of prepaying
          the Loans in whole or in part (but, if in part, then (i) if such Loan or
          Loans constitutes part of the Base Rate Portion, in an amount not less than
          $100,000, (ii) if such Loan or Loans constitutes part of a Fixed Rate
          Portion, in an amount not less than $100,000, and (iii) in each case, in an
          amount such that the minimum amount required for a Loan pursuant to
          Section 2.2 hereof remain outstanding) at any time upon prior notice
          to the Bank (such notice if received subsequent to 11:00 a.m. (Chicago
          time) on a given day to be treated as though received at the opening of business
          on the next Business Day) by paying to the Bank the principal amount to be
          prepaid and (i) if such a prepayment prepays the Note in full and is
          accompanied by the termination of the Commitment in whole, accrued interest
          thereon to the date of prepayment, and (ii)  in the case of any prepayment
          of a Fixed Rate Portion of the Loans, accrued interest thereon to the date of
          prepayment plus any amounts due the Bank under Section 2.8 hereof. 

             Section 3.3.       
          Terminations.  The Borrower shall have the right, at any time
          and from time to time, upon 5 Business Days prior notice to the Bank, to
          terminate without premium or penalty and in whole or in part (but if in part,
          then in an amount not less than $2,500,000) the Commitment, provided that
          the Commitment may not be reduced to an amount less than the aggregate principal
          amount of the Loans and Letters of Credit then outstanding. Any termination of
          the Commitment pursuant to this Section may not be reinstated. 

             Section 3.4.       
          Place and Application of Payments. All payments of principal, interest,
          fees, and all other Obligations payable under the Loan Documents shall be made
          to the Bank at its office at 111 West Monroe Street, Chicago, Illinois (or at
          such other place as the Bank may specify) no later than 1:00 p.m. (Chicago
          time) on the date any such payment is due and payable. Payments received by the
          Bank after 1:00 p.m. (Chicago time) shall be deemed received as of the
          opening of business on the next Business Day. All such payments shall be made in
          lawful money of the United States of America, in immediately available funds at
          the place of payment, without set-off or counterclaim and without reduction for,
          and free from, any and all present or future taxes, levies, imposts, duties,
          fees, charges, deductions, withholdings, restrictions, and conditions of any
          nature imposed by any government or any political subdivision or taxing
          authority thereof (but excluding any taxes imposed on or measured by the net
          income of the Bank). Unless the Borrower otherwise directs, principal payments
          shall be applied first to the Base Rate Portion until payment in full thereof,
          with any balance applied to the Fixed Rate Portions in the order in which their
          Interest Periods expire. The Borrower hereby irrevocably authorizes the Bank to
          (a) charge from time to time any of the Borrower’s deposit accounts
          with the Bank and/or (b)  make Loans from time to time hereunder (and any
          such Loan may be made by the Bank hereunder without regard to the provisions of
          Section 7 hereof), in each case for payment of any Obligation then due and
          payable (whether such Obligation is for interest then

-9- 

due on a Loan,
          reimbursement under an Application or otherwise); provided that the Bank
          shall not be under any obligation to charge any such deposit account or make
any           such Loan under this Section, and the Bank shall incur no liability to the
          Borrower or any other Person for its failure to do so.  

             Section 3.5.       
          Notations. All Loans made against the Note, the status of all amounts
          evidenced by the Note as constituting part of the Base Rate Portion or a Fixed
          Rate Portion, and, in the case of any Fixed Rate Portion, the rates of interest
          and Interest Periods applicable to such Portions shall be recorded by the Bank
          on its books and records or, at its option in any instance, endorsed on a
          schedule to the Note and the unpaid principal balance and status, rates and
          Interest Periods so recorded or endorsed by the Bank shall be prima facie
          evidence in any court or other proceeding brought to enforce the Note of the
          principal amount remaining unpaid thereon, the status of the Loans evidenced
          thereby and the interest rates and Interest Periods applicable thereto;
          provided that the failure of the Bank to record any of the foregoing
          shall not limit or otherwise affect the obligation of the Borrower to repay the
          principal amount of the Note together with accrued interest thereon. Prior to
          any negotiation of the Note, the Bank shall record on a schedule thereto the
          status of all amounts evidenced thereby as constituting part of the Base Rate
          Portion or a Fixed Rate Portion and, in the case of any Fixed Rate Portion, the
          rates of interest and the Interest Periods applicable thereto. 

SECTION 4.    GUARANTIES. 

        The
payment and performance of the Obligations shall at all times be guaranteed by each direct
and indirect Subsidiary of the Borrower (other than Immaterial Subsidiaries) pursuant to
one or more guaranty agreements in form and substance acceptable to the Bank, as the same
may be amended, modified, or supplemented from time to time (individually a
“Guaranty” and collectively the “Guaranties”);
provided, however, that, unless otherwise required by the Bank during the existence
of any Event of Default, a Foreign Subsidiary shall not be required to be a Guarantor
hereunder if providing such Guaranty would cause an adverse effect on the Borrower’s
federal income tax liability. In the event the Borrower or any Subsidiary forms or
acquires any other Subsidiary after the date hereof, except as otherwise provided above,
the Borrower shall promptly upon such formation or acquisition cause such newly formed or
acquired Subsidiary to execute a Guaranty, and the Borrower shall also deliver to the
Bank, or cause such Subsidiary to deliver to the Bank, at the Borrower’s cost and
expense, such other instruments, documents, certificates, and opinions reasonably required
by the Bank in connection therewith. 

     SECTION 5.    
          DEFINITIONS; INTERPRETATION. 

             Section 5.1.       
          Definitions. The following terms when used herein shall have the
          following meanings: 

-10- 

            “Adjusted
LIBOR” means a rate per annum determined by the Bank in accordance with the
following formula: 

	Adjusted LIBOR    =	                 LIBOR                 
	 	100%-Reserve Percentage

“Reserve
Percentage” means, for the purpose of computing Adjusted LIBOR, the maximum rate
of all reserve requirements (including, without limitation, any marginal, emergency,
supplemental or other special reserves) imposed by the Board of Governors of the Federal
Reserve System (or any successor) under Regulation D on Eurocurrency liabilities (as such
term is defined in Regulation D) for the applicable Interest Period as of the first day of
such Interest Period, but subject to any amendments to such reserve requirement by such
Board or its successor, and taking into account any transitional adjustments thereto
becoming effective during such Interest Period. For purposes of this definition, LIBOR
Portions shall be deemed to be Eurocurrency liabilities as defined in Regulation D without
benefit of or credit for prorations, exemptions or offsets under Regulation D.
“LIBOR” means, for each Interest Period, (a) the LIBOR Index Rate
for such Interest Period, if such rate is available, and (b) if the LIBOR Index Rate
cannot be determined, the arithmetic average of the rates of interest per annum (rounded
upward, if necessary, to the nearest 1/100th of 1%) at which deposits in U.S. Dollars
in immediately available funds are offered to the Bank at 11:00 a.m. (London, England
time) 2 Business Days before the beginning of such Interest Period by 3 or more major
banks in the interbank eurodollar market selected by the Bank for a period equal to such
Interest Period and in an amount equal or comparable to the applicable LIBOR Portion
scheduled to be outstanding from the Bank during such Interest Period. “LIBOR
Index Rate” means, for any Interest Period, the rate per annum (rounded upwards,
if necessary, to the next higher one hundred-thousandth of a percentage point) for
deposits in U.S. Dollars for a period equal to such Interest Period which appears on
the Telerate Page 3750 as of 11:00 a.m. (London, England time) on the date 2
Business Days before the commencement of such Interest Period. “Telerate
Page 3750” means the display designated as “Page 3750” on the
Telerate Service (or such other page as may replace Page 3750 on that service or such
other service as may be nominated by the British Bankers’ Association as the
information vendor for the purpose of displaying British Bankers’ Association
Interest Settlement Rates for U.S. Dollar deposits). Each determination of LIBOR made
by the Bank shall be conclusive and binding absent manifest error. 

            “Affiliate”
means any Person directly or indirectly controlling or controlled by, or under direct or
indirect common control with, another Person. A Person shall be deemed to control another
Person for purposes of this definition if such Person possesses, directly or indirectly,
the power to direct, or cause the direction of, the management and policies of the other
Person, whether through the ownership of voting securities, common directors, trustees or
officers, by contract or otherwise. 

            “Agreement”
means this Credit Agreement, as the same may be amended, modified, or restated from
time to time in accordance with the terms hereof. 

            “Applicable
Margin” means, with respect to Loans, reimbursement obligations with respect to
Letters of Credit, and the commitment fees and letter of credit fees payable under

-11- 

Section 3.1 hereof, until the
first Pricing Date, the rates per annum shown opposite Level III below, and
thereafter from one Pricing Date to the next the Applicable Margin means the rates per
annum determined in accordance with the following schedule:  

	LEVEL	DEBT TO EBITDA         

RATIO FOR SUCH         

PRICING DATE         	APPLICABLE MARGIN            

FOR BASE RATE            

PORTION AND            

REIMBURSEMENT            

OBLIGATIONS WITH            

RESPECT TO LETTERS            

OF CREDIT SHALL BE:            	APPLICABLE MARGIN            

FOR LIBOR            

PORTIONS AND            

OFFERED RATE            

PORTIONS AND            

LETTER OF CREDIT            

FEE SHALL BE:          	APPLICABLE         

MARGIN FOR         

COMMITMENT FEE         

SHALL BE:         
	 
	IV	 	Greater than or
equal to 2.00 to
1.00	 	0%	 	0.850%	 	.250%	 
	 
	III	 	Less than 2.00 to
1.00, but greater
than or equal to
1.50 to 1.00	 	0%		0.6375%	 	.200%	 
	 
	II	 	Less than 1.50 to
1.00, but greater
than or equal to
1.00 to 1	 	0%		0.500%	 	.150%	 
	 
	 I	 	Less than 1.00 to 1	 	0%		0.425%	 	.125%	 

For purposes hereof, the
term “Pricing Date” means, for any fiscal quarter of the Borrower ending
on or after December 27, 2003, the date on which the Bank is in receipt of the
Borrower’s most recent financial statements (and, in the case of the year-end
financial statements, audit report) for the fiscal quarter then ended, pursuant to
Section 8.5 hereof. The Applicable Margin shall be established based on the Debt
to EBITDA Ratio for the most recently completed fiscal quarter and the Applicable Margin
established on a Pricing Date shall remain in effect until the next Pricing Date. If the
Borrower has not delivered its financial statements by the date such financial statements
(and, in the case of the year-end financial statements, audit report) are required to be
delivered under Section 8.5 hereof, until such financial statements and audit report
are delivered, the Applicable Margin shall be the highest Applicable Margin (i.e.,
Level IV shall apply). If the Borrower subsequently deliver such financial statements
before the next Pricing Date, the Applicable Margin established by such late delivered
financial statements shall take effect from the date of delivery until the next Pricing
Date. In all other circumstances, the Applicable Margin established by such financial
statements shall be in effect from the Pricing Date that occurs immediately after the end
of the fiscal quarter covered by such financial statements until the next Pricing Date.
Each determination of the Applicable Margin made by the Bank in accordance with the
foregoing shall be conclusive and binding on the Borrower if reasonably determined. 

            “Application”
is defined in Section 1.3 hereof. 

-12- 

            “Authorized
Representative” means those persons shown on the list of officers provided by the
Borrower pursuant to Section 7.2 hereof or on any update of any such list provided by
the Borrower to the Bank, or any further or different officer of the Borrower so named by
any Authorized Representative of the Borrower in a written notice to the Bank. 

            “Bank”
is defined in the introductory paragraph hereof. 

            “Base
Rate” means, for any day, the greater of (a) the rate of interest announced
by the Bank from time to time as its prime commercial rate, as in effect on such day (it
being understood and agreed that such rate may not be the Bank’s best or lowest
rate), and (b) the sum of (i) the rate determined by the Bank to be the average
(rounded upwards, if necessary, to the next higher 1/100 of 1%) of the rates per annum
quoted to the Bank at approximately 10:00 a.m. (Chicago time) (or as soon thereafter
as is practicable) on such day (or, if such day is not a Business Day, on the immediately
preceding Business Day) by two or more Federal funds brokers selected by the Bank for the
sale to the Bank at face value of Federal funds in an amount equal or comparable to the
principal amount owed to the Bank for which such rate is being determined, plus
(ii) 1/2 of 1%. 

            “Base
Rate Portion” is defined in Section 2.1(a) hereof. 

            “Borrower”
is defined in the introductory paragraph hereof. 

            “Business
Day” means any day other than a Saturday or Sunday on which the Bank is not
authorized or required to close in Chicago, Illinois and, when used with respect to LIBOR
Portions, a day on which the Bank is also dealing in United States Dollar deposits in
London, England, and Nassau, Bahamas. 

            “Capital
Lease” means any lease of Property which in accordance with GAAP is required to
be capitalized on the balance sheet of the lessee. 

            “Capitalized
Lease Obligation” means the amount of the liability shown on the balance sheet of
any Person in respect of a Capital Lease determined in accordance with GAAP. 

            “Change
of Control” means any of (a) the acquisition by any
“person” or “group” (as such terms are used in
sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) at any
time of beneficial ownership of 33 1/3% or more of the outstanding capital stock or other
equity interests of the Borrower on a fully-diluted basis, (b) the failure of
individuals who are members of the board of directors (or similar governing body) of the
Borrower on the Closing Date (together with any new or replacement directors whose initial
nomination for election was approved by a majority of the directors who were either
directors on the Closing Date or previously so approved) to constitute a majority of the
board of directors (or similar governing body) of the Borrower, or (c) any
“Change of Control” (or words of like import), as defined in any agreement or
indenture relating to any issue of Indebtedness for Borrowed Money, shall occur. 

-13-

            “Code”
means the Internal Revenue Code of 1986, as amended, and any successor statute thereto. 

            “Commitment”
is defined in Section 1.1 hereof. 

            “Consolidated
Net Earnings” means, for any period, the net earnings (or net loss) of the
Borrower and its Subsidiaries for such period as computed on a consolidated basis in
accordance with GAAP consistently applied, and without limiting the foregoing, after
deduction from gross income of all expenses, including provisions for all taxes on or
measured by income, but excluding any extraordinary profits or losses on the sale or other
disposition of fixed or capital assets or on the acquisition, retirement, sale or other
disposition of stock or securities of the Borrower or any Subsidiary and also excluding
any taxes on such profits and any tax deductions or credits on account of any such losses. 

            “Consolidated
Net Worth” means, at any time, the excess of total assets of the Borrower and its
Subsidiaries over the total liabilities and reserves of the Borrower and its Subsidiaries
computed on a consolidated basis in accordance with GAAP consistently applied. 

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

            “Debt
to EBITDA Ratio” means, as of the last day of any fiscal quarter of the Borrower,
the ratio of (a) Funded Debt as of such day to (b) EBITDA for the four fiscal
quarter period ending on such day. 

            “Default”
means any event or condition the occurrence of which would, with the passage of time or
the giving of notice, or both, constitute an Event of Default. 

            “Domestic
Subsidiary” means any Subsidiary other than a Foreign Subsidiary. 

            “EBIT”
means, with reference to any period, Consolidated Net Earnings for such period plus all
amounts deducted in arriving at such Consolidated Net Earnings in respect of (a) Interest
Expense and (b) taxes imposed on or measured by income or excess profits. 

            “EBITDA”
means, with reference to any period, Consolidated Net Earnings for such period plus all
amounts deducted in arriving at such Consolidated Net Earnings in respect of
(a) Interest Expense, (b) taxes imposed on or measured by income or excess
profits, and (c) depreciation, depletion and amortization. 

            “ERISA”
means the Employee Retirement Income Security Act of 1974, as amended, or any successor
statute thereto. 

            “Event
of Default” means any event or condition identified as such in Section 9.1
hereof. 

-14-

            “Fixed
Rate Portions” means and includes LIBOR Portions and Offered Rate Portions,
unless the context in which such term is used shall otherwise require. 

            “Foreign
Subsidiary” means each Subsidiary which (a) is organized under the laws of a
jurisdiction other than the United States of America or any state thereof,
(b) conducts substantially all of its business outside of the United States of
America, and (c) has substantially all of its assets outside of the United States of
America. 

            “Funded
Debt” means, at any time the same is to be determined, the sum (but without
duplication) of (a) all Indebtedness for Borrowed Money of the Borrower and its
Subsidiaries at such time, and (b) all Indebtedness for Borrowed Money of any other
Person which is directly or indirectly guaranteed by the Borrower or any of its
Subsidiaries or which the Borrower or any of its Subsidiaries has agreed (contingently or
otherwise) to purchase or otherwise acquire or in respect of which the Borrower or any of
its Subsidiaries has otherwise assured a creditor against loss. 

            “GAAP”
means generally accepted accounting principles set forth from time to time in the opinions
and pronouncements of the Accounting Principles Board and the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial Accounting
Standards Board (or agencies with similar functions of comparable stature and authority
within the U.S. accounting profession), which are applicable to the circumstances as of
the date of determination. 

            “Guaranty”
and “Guaranties” each is defined in Section 4 hereof. 

            “Immaterial
Subsidiaries” means DW Holding, L.L.C., a Delaware limited liability company, WH
One, LLC, a Delaware limited liability company and WH Two, LLC, a Delaware limited
liability company. 

            “Indebtedness
for Borrowed Money” means for any Person (without duplication) (a) all
indebtedness created, assumed or incurred in any manner by such Person representing money
borrowed (including by the issuance of debt securities), (b) all indebtedness for the
deferred purchase price of property or services (other than trade accounts payable arising
in the ordinary course of business), (c) all indebtedness secured by any Lien upon
Property of such Person, whether or not such Person has assumed or become liable for the
payment of such indebtedness, (d) all Capitalized Lease Obligations of such Person,
and (e) all obligations of such Person on or with respect to letters of credit,
bankers’ acceptances and other extensions of credit whether or not representing
obligations for borrowed money. 

            “Interest
Coverage Ratio” means, as of any time the same is to be determined, the ratio of
(a) EBIT during the twelve most recently completed calendar months to
(b) Interest Expense during the same period. 

            “Interest
Expense” shall mean with reference to any period all interest charges (including
imputed interest on Capitalized Lease Obligations) and amortization of debt discount and

-15-

expense with respect to all Indebtedness for Borrowed Money of the Borrower and its
Subsidiaries during such period. 

            “Interest
Period” means, with respect to (a) any LIBOR Portion, the period commencing
on, as the case may be, the creation, continuation or conversion date with respect to such
LIBOR Portion and ending 1, 2, 3, or 6 months thereafter as selected by the Borrower
in its notice as provided herein and (b) any Offered Rate Portion, the period
commencing on, as the case may be, the creation, continuation or conversion date with
respect to such Offered Rate Portion and ending 5 to 180 days thereafter as selected
by the Borrower in its notice as provided herein; provided that all of the foregoing
provisions relating to Interest Periods are subject to the following: 

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

               

          		        (ii)       
          no Interest Period may extend beyond the final maturity date of the Note; and 

          

          		        (iii)       
               the interest rate to be applicable to each Portion for each Interest Period
               shall apply from and including the first day of such Interest Period to but
               excluding the last day thereof. 

               

For purposes of
determining an Interest Period, a month means a period starting on one day in a calendar
month and ending on a numerically corresponding day in the next calendar month,
provided, however, if an Interest Period begins on the last day of a month or if
there is no numerically corresponding day in the month in which an Interest Period is to
end, then such Interest Period shall end on the last Business Day of such month. 

            “Letter
of Credit” and “Letters of Credit” each is defined in Section
1.3 hereof. 

            “LIBOR
Portions” is defined in Section 2.1(a) hereof. 

            “Lien”
means any mortgage, lien, security interest, pledge, charge, or encumbrance of any
kind in respect of any Property, including the interests of a vendor or lessor under any
conditional sale, Capital Lease or other title retention arrangement. 

            “Loan”
and “Loans” each is defined in Section 1.2 hereof. 

            “Loan
Documents” means this Agreement, the Note, the Applications, the Guaranties, and
each other instrument or document to be delivered hereunder or thereunder or otherwise in
connection therewith. 

-16-

            “Material
Adverse Effect” means (a) a material adverse change in, or material adverse
effect upon, the operations, business, Property, condition (financial or otherwise) or
prospects of the Borrower or of the Borrower and its Subsidiaries taken as a whole,
(b) a material impairment of the ability of the Borrower or any Subsidiary to perform
its obligations under any Loan Document, or (c) a material adverse effect upon the
legality, validity, binding effect or enforceability against the Borrower or any
Subsidiary of any Loan Document or the rights and remedies of the Bank thereunder. 

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

            “Note”
is defined in Section 1.2 hereof. 

            “Obligations”
means all obligations of the Borrower to pay principal and interest on the Loans, all
reimbursement obligations owing under the Applications, all fees and charges payable
hereunder, and all other payment obligations of the Borrower arising under or in relation
to any Loan Document, in each case whether now existing or hereafter arising, due or to
become due, direct or indirect, absolute or contingent, and howsoever evidenced, held, or
acquired. 

            “Offered
Rate” means the rate per annum quoted to the Borrower by the Bank for the
applicable Interest Period, such Offered Rate being subject at all times to the provisions
of Section 2.1(d) hereof. 

            “Offered
Rate Portions” is defined in Section 2.1(a) hereof. 

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

            “Person”
means an individual, partnership, corporation, limited liability company, association,
trust, unincorporated organization, or any other entity or organization, including a
government or agency or political subdivision thereof. 

            “Plan”
means any employee pension benefit plan covered by Title IV of ERISA or subject to
the minimum funding standards under Section 412 of the Code that either (a) is
maintained by a member of the Controlled Group for employees of a member of the Controlled
Group or (b) is maintained pursuant to a collective bargaining agreement or any other
arrangement under which more than one employer makes contributions and to which a member
of the Controlled Group is then making or accruing an obligation to make contributions or
has within the preceding five plan years made contributions. 

            “Portion”
is defined in Section 2.1(a) hereof. 

            “Property”
means any interest in any kind of property or asset, whether real, personal or mixed, or
tangible or intangible. 

            “Revolving
Credit” is defined in Section 1.1 hereof. 

-17-

            “Subsidiary”
means any corporation or other Person more than 50% of the outstanding ordinary voting
shares or other equity interests of which is at the time directly or indirectly owned by
the Borrower, by one or more of its Subsidiaries, or by the Borrower and one or more of
its Subsidiaries. 

            “Termination
Date” means April 28, 2007, or such later date to which the Commitment is
extended pursuant to Section 1.5 hereof, or such earlier date on which the Commitment
is terminated in whole pursuant to Section 3.3, 9.2 or 9.3 hereof. 

            “Unfunded
Vested Liabilities” means, for any Plan at any time, the amount (if any)
by which the present value of all vested nonforfeitable accrued benefits under such Plan
exceeds the fair market value of all Plan assets allocable to such benefits, all
determined as of the then most recent valuation date for such Plan, but only to the extent
that such excess represents a potential liability of a member of the Controlled Group to
the PBGC or the Plan under Title IV of ERISA. 

            “Welfare
Plan” means a “welfare plan” as defined in Section 3(1) of ERISA. 

            “Wholly-Owned
Subsidiary” means a Subsidiary of which all of the issued and outstanding shares
of capital stock (other than directors’ qualifying shares as required by law) or
other equity interests are owned by the Borrower and/or one or more Wholly-Owned
Subsidiaries within the meaning of this definition. 

             Section 5.2.       
          Interpretation. The foregoing definitions are equally applicable to both
          the singular and plural forms of the terms defined. The words
          “hereof”, “herein”, and
          “hereunder” and words of like import when used in this
          Agreement shall refer to this Agreement as a whole and not to any particular
          provision of this Agreement. All references to time of day herein are references
          to Chicago, Illinois time unless otherwise specifically provided. Where the
          character or amount of any asset or liability or item of income or expense is
          required to be determined or any consolidation or other accounting computation
          is required to be made for the purposes of this Agreement, it shall be done in
          accordance with GAAP except where such principles are inconsistent with the
          specific provisions of this Agreement. 

     SECTION 6.    REPRESENTATIONS AND WARRANTIES. 

        The
Borrower represents and warrants to the Bank as follows: 

             Section 6.1.       
          Organization and Qualification. The Borrower is duly organized, validly
          existing, and in good standing as a corporation under the laws of the
          State of Delaware, has full and adequate power to own its Property and conduct
          its business as now conducted, and is duly licensed or qualified and in good
          standing in each jurisdiction in which the nature of the business conducted by
          it or the nature of the Property owned or leased by it requires such licensing
          or qualifying where the failure to do so could reasonably be expected to have a
          Material Adverse Effect. 

             Section 6.2.       
          Subsidiaries. Each Subsidiary is duly organized, validly existing, and in
          good standing under the laws of the jurisdiction in which it is incorporated or
          organized, as the

-18-

case may be, has full and adequate power to own its Property
          and conduct its business as now conducted, and is duly licensed or qualified and
          in good standing in each jurisdiction in which the nature of the business
          conducted by it or the nature of the Property owned or leased by it requires
          such licensing or qualifying where the failure to do so could reasonably be
          expected to have a Material Adverse Effect. Schedule 6.2 hereto identifies
          each Subsidiary, the jurisdiction of its organization, the percentage of issued
          and outstanding shares of each class of its capital stock or other equity
          interests owned by the Borrower and the Subsidiaries and, if such percentage is
          not 100% (excluding directors’ qualifying shares as required by law), a
          description of each class of its authorized capital stock and other equity
          interests and the number of shares of each class issued and outstanding. All of
          the outstanding shares of capital stock and other equity interests of each
          Subsidiary are validly issued and outstanding and fully paid and nonassessable
          and all such shares and other equity interests indicated on Schedule 6.2 as
          owned by the Borrower or a Subsidiary are owned, beneficially and of record, by
          the Borrower or such Subsidiary free and clear of all Liens. There are no
          outstanding commitments or other obligations of any Subsidiary to issue, and no
          options, warrants or other rights of any Person to acquire, any shares of any
          class of capital stock or other equity interests of any Subsidiary.

             Section 6.3.       
          Authority and Validity of Obligations. The Borrower has full right
          and authority to enter into this Agreement and the other Loan Documents, to make
          the borrowings herein provided for, to issue its Note in evidence thereof, and
          to perform all of its obligations hereunder and under the other Loan Documents.
          Each Subsidiary has full right and authority to enter into the Loan Documents
          executed by it, to guarantee the Obligations, and to perform all of its
          obligations under the Loan Documents executed by it. The Loan Documents
          delivered by the Borrower and its Subsidiaries have been duly authorized,
          executed, and delivered by such Persons and constitute valid and binding
          obligations of the Borrower and its Subsidiaries enforceable against them in
          accordance with their terms except as enforceability may be limited by
          bankruptcy, insolvency, fraudulent conveyance, or similar laws affecting
          creditors’ rights generally and general principles of equity (regardless of
          whether the application of such principles is considered in a proceeding in
          equity or at law); and this Agreement and the other Loan Documents do not, nor
          does the performance or observance by the Borrower or any Subsidiary of any of
          the matters and things herein or therein provided for, (a) contravene or
          constitute a default under any provision of law or any judgment, injunction,
          order or decree binding upon the Borrower or any Subsidiary or any provision of
          the organizational documents (e.g., charter, certificate or articles of
          incorporation and by-laws, certificate or articles of association and operating
          agreement, partnership agreement, or other similar organizational documents) of
          the Borrower or any Subsidiary or any covenant, indenture or agreement of or
          affecting the Borrower or any Subsidiary or any of their Property, or (b) result
          in the creation or imposition of any Lien on any Property of the Borrower or any
          Subsidiary other than the Liens granted to the Bank. 

             Section 6.4.       
          Use of Proceeds; Margin Stock. The Borrower shall use the proceeds of the
          Loans and other extensions of credit made available hereunder for general
          working capital purposes and for such other legal and proper purposes as are
          consistent with all applicable laws. Neither the Borrower nor any Subsidiary is
          engaged in the business of extending credit for the purpose of purchasing or
          carrying margin stock (within the meaning of Regulation U of the Board of
          Governors of the Federal Reserve System), and no part of the proceeds of any

-19-

extension of credit made hereunder will be used to purchase or carry any such
          margin stock or to extend credit to others for the purpose of purchasing or
          carrying any such margin stock.

             Section 6.5.       
          Financial Reports. The consolidated balance sheet of the Borrower and its
          Subsidiaries as at September 27, 2003, and the related consolidated
          statements of income, retained earnings, and cash flows of the Borrower and its
          Subsidiaries for the fiscal year then ended, and accompanying notes thereto,
          which financial statements are accompanied by the audit report of Ernst &
          Young LLP, independent public accountants, and the unaudited interim
          consolidated balance sheet of the Borrower and its Subsidiaries as at
          December 27, 2003, and the related consolidated statements of income,
          retained earnings, and cash flows of the Borrower and its Subsidiaries for the
          three months then ended, heretofore furnished to the Bank, fairly present the
          consolidated financial condition of the Borrower and its Subsidiaries as at said
          dates and the consolidated results of their operations and cash flows for the
          periods then ended in conformity with GAAP applied on a consistent basis.
          Neither the Borrower nor any Subsidiary has contingent liabilities which are
          material to it other than as indicated on such financial statements or, with
          respect to future periods, on the financial statements furnished pursuant to
          Section 8.5 hereof. 

             Section 6.6.       
          No Material Adverse Change. On the date hereof the Borrower hereby
          represents that since September 27, 2003, there has been no change in the
          condition (financial or otherwise) or business prospects of the Borrower or any
          Subsidiary except those occurring in the ordinary course of business, none of
          which individually or in the aggregate have been materially adverse. 

             Section 6.7.       
          Full Disclosure. The statements and information furnished to the Bank in
          connection with the negotiation of this Agreement and the other Loan Documents
          and the commitment by the Bank to provide all or part of the financing
          contemplated hereby do not contain any untrue statements of a material fact or
          omit a material fact necessary to make the material statements contained herein
          or therein not misleading, the Bank acknowledging that, as to any projections
          furnished to the Bank, the Borrower only represents that the same were prepared
          on the basis of information and estimates the Borrower believed to be
          reasonable. 

             Section 6.8.       
          Trademarks, Franchises and Licenses. The Borrower and its Subsidiaries
          own, possess or have the right to use all necessary patents, licenses,
          franchises, trademarks, trade names, trade styles, copyrights, trade secrets,
          know how, and confidential commercial and proprietary information to conduct
          their businesses as now conducted, without known conflict with any patent,
          license, franchise, trademark, trade name, trade style, copyright, or other
          proprietary right of any other Person. 

             Section 6.9.       
          Governmental Authority and Licensing. The Borrower and its Subsidiaries
          have received all licenses, permits, and approvals of all federal, state, local,
          and foreign governmental authorities, if any, necessary to conduct their
          businesses, in each case where the failure to obtain or maintain the same could
          reasonably be expected to have a Material Adverse Effect. No investigation or
          proceeding which, if adversely determined, could reasonably be expected to
          result in revocation or denial of any material license, permit or approval is
          pending or, to the knowledge of the Borrower, threatened. 

-20-

             Section 6.10.       
          Good Title. The Borrower and its Subsidiaries have good and defensible
          title (or valid leasehold interests) to their assets as reflected on the most
          recent consolidated balance sheet of the Borrower and its Subsidiaries furnished
          to the Bank (except for sales of assets by the Borrower and its Subsidiaries in
          the ordinary course of business), subject to no Liens other than such thereof as
          are permitted by Section 8.8 hereof. 

             Section 6.11.       
          Litigation and Other Controversies. There is no litigation or
          governmental or arbitration proceeding or labor controversy pending, nor to the
          knowledge of the Borrower threatened, against the Borrower or any Subsidiary or
          any of their Property which if adversely determined could reasonably be expected
          to have a Material Adverse Effect. 

             Section 6.12.       
          Taxes. All tax returns required to be filed by the Borrower or any
          Subsidiary in any jurisdiction have, in fact, been filed, and all taxes,
          assessments, fees, and other governmental charges upon the Borrower or any
          Subsidiary or upon any of their Property, income or franchises, which are shown
          to be due and payable in such returns, have been paid, except such taxes,
          assessments, fees, and governmental charges, if any, as are being contested in
          good faith and by appropriate proceedings which prevent enforcement of the
          matter under contest and as to which adequate reserves established in accordance
          with GAAP have been provided. The Borrower does not know of any proposed
          additional tax assessment against it or its Subsidiaries for which adequate
          provisions in accordance with GAAP have not been made on their accounts.
          Adequate provisions in accordance with GAAP for taxes on the books of the
          Borrower and its Subsidiaries have been made for all open years, and for the
          current fiscal period. 

             Section 6.13.       
          Approvals. No authorization, consent, license, or exemption from, or
          filing or registration with, any court or governmental department, agency, or
          instrumentality, nor any approval or consent of any other Person, is or will be
          necessary to the valid execution, delivery, or performance by the Borrower or
          any Subsidiary of any Loan Document. 

             Section 6.14.       
          Affiliate Transactions. Neither the Borrower nor any Subsidiary is a
          party to any contracts or agreements with any of its Affiliates on terms and
          conditions which are less favorable to the Borrower or such Subsidiary than
          would be usual and customary in similar contracts or agreements between Persons
          not affiliated with each other. 

             Section 6.15.       
          Investment Company; Public Utility Holding Company. Neither the Borrower
          nor any Subsidiary is an “investment company” or a company
          “controlled” by an “investment company” within the meaning
          of the Investment Company Act of 1940, as amended, or a “public utility
          holding company” within the meaning of the Public Utility Holding Company
          Act of 1935, as amended. 

             Section 6.16.       
          ERISA. The Borrower and each other member of its Controlled Group has
          fulfilled its obligations under the minimum funding standards of, and is in
          compliance in all material respects with, ERISA and the Code to the extent
          applicable to it and has not incurred any liability to the PBGC or a Plan under
          Title IV of ERISA other than a liability to the PBGC for premiums under
          Section 4007 of ERISA. Neither the Borrower nor any Subsidiary has any

-21-

contingent liabilities with respect to any post-retirement benefits under a
          Welfare Plan, other than liability for continuation coverage described in
          article 6 of Title I of ERISA. 

             Section 6.17.       
          Compliance with Laws. The Borrower and its Subsidiaries are in compliance
          with the requirements of all federal, state and local laws, rules and
          regulations applicable to or pertaining to their Property or business operations
          (including, without limitation, the Occupational Safety and Health Act of 1970,
          the Americans with Disabilities Act of 1990, and laws and regulations
          establishing quality criteria and standards for air, water, land and toxic or
          hazardous wastes and substances), non-compliance with which, individually or in
          the aggregate, could reasonably be expected to have a Material Adverse Effect.
          Neither the Borrower nor any Subsidiary has received notice to the effect that
          its operations are not in compliance with any of the requirements of applicable
          federal, state or local environmental, health and safety statutes and
          regulations or are the subject of any governmental investigation evaluating
          whether any remedial action is needed to respond to a release of any toxic or
          hazardous waste or substance into the environment, which non-compliance or
          remedial action, individually or in the aggregate, could reasonably be expected
          to have a Material Adverse Effect. 

             Section 6.18.       
          Other Agreements. Neither the Borrower nor any Subsidiary is in default
          under the terms of any covenant, indenture or agreement of or affecting the
          Borrower, any Subsidiary or any of their Property, which default if uncured
          could reasonably be expected to have a Material Adverse Effect. 

        Section 6.19.       
Solvency. The Borrower and its Subsidiaries are solvent, able to pay
their debts as they become due, and have sufficient capital to carry on their business and
all businesses in which they are about to engage. 

             Section 6.20.       
          No Default. No Default or Event of Default has occurred and is
          continuing. 

     SECTION 7.    CONDITIONS PRECEDENT.

        The
obligation of the Bank to make any Loan or to issue any Letter of Credit under this
Agreement is subject to the following conditions precedent: 

             Section 7.1.       
          All Advances. As of the time of the making of each extension of credit
          (including the initial extension of credit) hereunder: 

          		        (a)       
               each of the representations and warranties set forth in Section 6
               hereof and in the other Loan Documents shall be true and correct as of such
               time, except to the extent the same expressly relate to an earlier date; 

               

          		        (b)       
               no Default or Event of Default shall have occurred and be continuing or would
               occur as a result of making such extension of credit; 

               

          		        (c)       
               in the case of the issuance of any Letter of Credit, the Bank shall have
               received a properly completed Application therefor together with the fees called
               for hereby; and 

               

-22-

          		        (d)       
               such extension of credit shall not violate any order, judgment, or decree of any
               court or other authority or any provision of law or regulation applicable to the
               Bank (including, without limitation, Regulation U of the Board of Governors
               of the Federal Reserve System) as then in effect. 

               

The Borrower’s
request for any Loan or Letter of Credit shall constitute its warranty as to the facts
specified in subsections (a) through (c), both inclusive, above. 

             Section 7.2.       
          Initial Advance. At or prior to the making of the initial extension of
          credit hereunder, the following conditions precedent shall also have been
          satisfied: 

          		        (a)       
               the Bank shall have received the following (and, with respect to all documents,
               each to be properly executed and completed) and the same shall have been
               approved as to form and substance by the Bank: 

               

          		          (i)      
          the Note; 

          		         (ii)       the Guaranty;

          		        (iii)      
               copies (executed or certified as may be appropriate) of resolutions of the Board
               of Directors or other governing body of the Borrower and of each Domestic
               Subsidiary (other than Immaterial Subsidiaries) authorizing the execution,
               delivery, and performance of the Loan Documents; 

               

          		        (iv)      
               articles of incorporation (or equivalent organizational document) of the
               Borrower and of each Domestic Subsidiary (other than Immaterial Subsidiaries)
               certified by the appropriate governmental office of the state of its
               organization; 

               

          		         (v)       
               by-laws (or equivalent organizational document) for the Borrower and for
               each Domestic Subsidiary (other than Immaterial Subsidiaries) certified by an
               appropriate officer of such Person acceptable to the Bank; 

               

          		        (vi)       
               an incumbency certificate containing the name, title and genuine signature of
               the Borrower’s Authorized Representatives; and 

               

          		       (vii)       
               good standing certificates for the Borrower and each Domestic Subsidiary (other
               than Immaterial Subsidiaries), dated as of a date no earlier than 30 days prior
               to the date hereof, from the appropriate governmental offices in the state of
               its incorporation or organization and in each state in which it is qualified to
               do business as a foreign organization (except that to the extent that good
               standing certificates for the State of New Jersey are required for Aero-Motive
               Company and Daniel Woodhead Company, such good standing certificates shall be
               delivered to the Bank no later than May 31, 2004); 

               

-23-

          		        (b)       
               the Bank shall have received such valuations and certifications as it may
               require in order to satisfy itself as to the financial condition of the Borrower
               and its Subsidiaries, and the lack of material contingent liabilities of the
               Borrower and its Subsidiaries; 

               

          		        (c)       
               legal matters incident to the execution and delivery of the Loan Documents
               and to the transactions contemplated hereby shall be satisfactory to the
               Bank and its counsel; and the Bank shall have received the favorable written
               opinion of counsel for the Borrower in form and substance satisfactory to the
               Bank and its counsel; and 

               

          		        (d)       
               the Bank shall have received such other agreements, instruments, documents,
               certificates and opinions as the Bank may reasonably request. 

               

             Section 7.3.       
          Termination of Prior Credit Facilities. The initial Loans hereunder shall
          be in an amount sufficient to repay all indebtedness of the Borrower (other than
          with respect to the existing letters of credit and Fixed Rate Loans referred to
          below) owing under the Credit Agreement dated as of October 29, 1993, as
          amended, between the Borrower and the Bank (the “Prior Credit
          Agreement”) and the Borrower hereby agrees that concurrently with the
          making of such initial Loans, all commitments under the Prior Credit Agreement
          shall automatically terminate, provided, however, that (a) any
          letters of credit issued under the Prior Credit Agreement which are currently
          outstanding and any applications therefor shall remain outstanding as the
          initial Letters of Credit and Applications outstanding hereunder and
          (b) any Fixed Rate Loans (as such term is defined in the Prior Credit
          Agreement) outstanding on the date hereof under the Prior Credit Agreement shall
          continue through the last day of their respective Interest Periods as the
          initial LIBOR Portions of Loans outstanding hereunder. 

     SECTION 8.    COVENANTS.

        The
Borrower agrees that, so long as any credit is available to or in use by the Borrower
hereunder, except to the extent compliance in any case or cases is waived in writing by
the Bank: 

             Section 8.1.       
          Maintenance of Business. The Borrower shall, and shall cause each
          Subsidiary (other than the Immaterial Subsidiaries) to, preserve and maintain
          its existence, except as otherwise permitted by Section 8.10 hereof. The
          Borrower shall, and shall cause each Subsidiary to, preserve and keep in force
          and effect all licenses, permits and franchises necessary to the proper conduct
          of its business, except where the failure to do so, individually or in the
          aggregate, could not reasonably be expected to have a Material Adverse Effect. 

             Section 8.2.       
          Maintenance of Properties. The Borrower shall maintain, preserve, and
          keep its property, plant, and equipment in good repair, working order and
          condition (ordinary wear and tear excepted) and shall from
          time to time make all needful and proper repairs, renewals, replacements,
          additions, and betterments thereto so that at all times the efficiency thereof
          shall be fully preserved and maintained, and shall cause each Subsidiary to do
          so in respect of Property owned or used by it. 

-24-

             Section 8.3.       
          Taxes and Assessments. The Borrower shall duly pay and discharge, and
          shall cause each Subsidiary to duly pay and discharge, all taxes, rates,
          assessments, fees, and governmental charges upon or against it or its Property,
          in each case before the same become delinquent and before penalties accrue
          thereon, unless and to the extent that the same are being contested in good
          faith and by appropriate proceedings which prevent enforcement of the matter
          under contest and adequate reserves are provided therefor. 

             Section 8.4.       
          Insurance. The Borrower shall insure and keep insured, and shall cause
          each Subsidiary to insure and keep insured, with good and responsible insurance
          companies, all insurable Property owned by it which is of a character usually
          insured by Persons similarly situated and operating like Properties against loss
          or damage from such hazards and risks, and in such amounts, as are insured by
          Persons similarly situated and operating like Properties; and the Borrower shall
          insure, and shall cause each Subsidiary to insure, such other hazards and risks
          (including employers’ and public liability risks) with good and responsible
          insurance companies as and to the extent usually insured by Persons similarly
          situated and conducting similar businesses. The Borrower shall upon request
          furnish to the Bank a certificate setting forth in summary form the nature and
          extent of the insurance maintained pursuant to this Section. 

             Section 8.5.       
          Financial Reports. The Borrower shall, and shall cause each Subsidiary
          to, maintain a standard system of accounting in accordance with GAAP and shall
          furnish to the Bank and its duly authorized representatives such information
          respecting the business and financial condition of the Borrower and its
          Subsidiaries as the Bank may reasonably request; and without any request, shall
          furnish to the Bank: 

          		        (a)       
               as soon as available, and in any event within 45 days after the last day of
               each of the first three fiscal quarters of each fiscal year of the Borrower, a
               copy of the consolidated and consolidating balance sheet of the Borrower and its
               Subsidiaries as of the last day of such period and the consolidated and
               consolidating statements of income, retained earnings, and cash flows of the
               Borrower and its Subsidiaries for the fiscal quarter and the fiscal year-to-date
               period then ended, each in reasonable detail showing in comparative form the
               figures for the corresponding date and period in the previous fiscal year,
               prepared by the Borrower in accordance with GAAP and certified to by its chief
               financial officer, treasurer, or such other officer acceptable to the Bank; 

               

          		        (b)       
               as soon as available, and in any event within 90 days after the close of
               each fiscal year of the Borrower, a copy of the consolidated and consolidating
               balance sheet of the Borrower and its Subsidiaries as of the close of such
               period and the consolidated and consolidating statements of income, retained
               earnings, and cash flows of the Borrower and its Subsidiaries for such period,
               and accompanying notes thereto, each in reasonable detail showing in comparative
               form the figures for the previous fiscal year, accompanied by an unqualified
               opinion thereon of independent public accountants of recognized standing,
               selected by the Borrower and satisfactory to the Bank, to the effect that the
               financial statements have been prepared in accordance with GAAP and present
               fairly in accordance with GAAP the consolidated financial condition of the
               Borrower and its Subsidiaries as of the close of such fiscal year and the
               results of their operations and cash flows for the fiscal year then ended and
               that an examination of such

-25-

          		accounts in connection with such financial
               statements has been made in accordance with generally accepted auditing
               standards and, accordingly, such examination included such tests of the
               accounting records and such other auditing procedures as were considered
               necessary in the circumstances; 

               

          		        (c)       
               promptly after the sending or filing thereof, copies of each financial
               statement, report, notice or proxy statement sent by the Borrower or any
               Subsidiary to its stockholders or other equity holders, and copies of each
               regular, periodic or special report, registration statement or prospectus
               (including all Form 10-K, Form 10-Q and Form 8-K reports) filed by the Borrower
               or any Subsidiary with any securities exchange or the Securities and Exchange
               Commission or any successor agency; 

               

          		        (d)       
               promptly after receipt thereof, any additional written reports, management
               letters or other detailed information contained in writing concerning
               significant aspects of the Borrower’s or any Subsidiary’s operations
               and financial affairs given to it by its independent public accountants; 

               

          		        (e)       
               promptly after knowledge thereof shall have come to the attention of any
               responsible officer of the Borrower, written notice of (i) any threatened
               or pending litigation or governmental or arbitration proceeding or labor
               controversy against the Borrower or any Subsidiary or any of their Property
               which, if adversely determined, could reasonably be expected to have a Material
               Adverse Effect, (ii) any Change of Control, or (iii) the occurrence of
               any Default or Event of Default hereunder; and 

               

          		        (f)       
               as soon as available, and in any event within 45 days after the last day of
               each fiscal quarter of the Borrower (other than the last fiscal quarter of each
               fiscal year, in which it shall be within 90 days after the last day), the
               Borrower shall deliver to the Bank a written certificate in the form attached
               hereto as Exhibit B signed by the chief financial officer or treasurer of
               the Borrower, or such other officer of the Borrower satisfactory to the Bank, to
               the effect that to the best of such officer’s knowledge and belief no
               Default or Event of Default has occurred during the period covered by such
               statements or, if any such Default or Event of Default has occurred during such
               period, setting forth a description of such Default or Event of Default and
               specifying the action, if any, taken by the Borrower to remedy the same together
               with calculations supporting such statements in respect of Section 8.20 of
               this Agreement. 

               

             Section 8.6.       
          Inspection. The Borrower shall, and shall cause each Subsidiary to,
          permit the Bank and its duly authorized representatives and agents to visit and
          inspect any of the Properties, corporate books and financial records of the
          Borrower and each Subsidiary, to examine and make copies of the books of
          accounts and other financial records of the Borrower and each Subsidiary, and to
          discuss the affairs, finances and accounts of the Borrower and each Subsidiary
          with, and to be advised as to the same by, its officers, employees, and
          independent public accountants (and by this provision the Borrower hereby
          authorizes such accountants to discuss with the Bank the finances and affairs of
          the Borrower and of each Subsidiary) at such reasonable times and reasonable
          intervals as the Bank may designate. 

-26-

             Section 8.7.       
          Borrowings and Guaranties. The Borrower shall not, nor shall it permit
          any Subsidiary to, issue, incur, assume, create, or have outstanding any
          Indebtedness for Borrowed Money, or be or become liable as endorser, guarantor,
          surety, or otherwise for any debt, obligation, or undertaking of any other
          Person, or otherwise agree to provide funds for payment of the obligations of
          another, or supply funds thereto or invest therein or otherwise assure a
          creditor of another against loss, or apply for or become liable to the issuer of
          a letter of credit which supports an obligation of another, or subordinate any
          claim or demand it may have to the claim or demand of any other Person;
          provided, however, that the foregoing shall not restrict nor operate to
          prevent: 

          		        (a)       
               the Obligations of the Borrower and its Subsidiaries owing to the Bank under the
               Loan Documents and other indebtedness and obligations of such Persons owing to
               the Bank; 

               

          		        (b)       
               purchase money indebtedness and Capitalized Lease Obligations of the Borrower
               and its Subsidiaries in an amount not to exceed $2,000,000 in the aggregate at
               any one time outstanding; 

               

          		        (c)       
               obligations of the Borrower arising out of interest rate and foreign currency
               hedging agreements entered into with financial institutions in the ordinary
               course of business; 

               

          		        (d)       
               endorsement of items for deposit or collection of commercial paper received in
               the ordinary course of business; 

               

          		        (e)       
               indebtedness owing to the holders of the Woodhead Finance Noteholders (as
               defined in the Intercreditor Agreement hereinafter referred to) issued pursuant
               to those certain Note Purchase Agreements dated as of September 1, 1998,
               between such Woodhead Finance Noteholders and the Borrower in the aggregate
               principal amount not exceeding $36,600,000, as reduced by repayment of principal
               thereon; 

               

          		        (f)       
               indebtedness from time to time owing by any Domestic Subsidiary (other than an
               Immaterial Subsidiary) or the Borrower to one another in the ordinary course of
               business; 

               

          		        (g)       
               indebtedness from time to time owing by one or more Foreign Subsidiaries to the
               Borrower or any Domestic Subsidiary in the ordinary course of business in the
               aggregate principal amount not exceeding the US dollar equivalent of $50,000,000
               at any one time outstanding; 

               

          		        (h)       
               indebtedness of one or more Foreign Subsidiaries owing to foreign banks not to
               exceed the aggregate principal amount (in U.S. dollar equivalent) of
               $25,000,000 at any one time outstanding; 

               

          		        (i)       
               guaranties in favor of the Bank or any Affiliate thereof; guaranties by
               Subsidiaries of the Borrower organized within the United States or any state
               thereof of

-27-

          		the obligations of the
Borrower and Woodhead Finance Company under
               the Note Purchase Agreements described in the Intercreditor Agreement dated as
               of September 1, 1998 (the “Intercreditor Agreement”),
               among the Bank, the Company Noteholders (as defined in the Intercreditor
               Agreement) and the Woodhead Finance Noteholders (as defined in the Intercreditor
               Agreement); and guaranties by the Borrower of up to $15,000,000 of Indebtedness
               for Borrowed Money of Wholly-Owned Subsidiaries (including foreign bank
               financings described in Section 8.7(h) hereof); and 

               

          		        (j)       
               unsecured indebtedness of the Borrower and its Subsidiaries not otherwise
               permitted by this Section in an amount not to exceed $5,000,000 in the aggregate
               at any one time outstanding. 

               

             Section 8.8.       
          Liens. The Borrower shall not, nor shall it permit any Subsidiary to,
          create, incur or permit to exist any Lien of any kind on any Property owned by
          any such Person; provided, however, that the foregoing shall not apply to
          nor operate to prevent: 

          		        (a)       
               Liens arising by statute in connection with worker’s compensation,
               unemployment insurance, old age benefits, social security obligations, taxes,
               assessments, statutory obligations, or other similar charges (other than Liens
               arising under ERISA), good faith cash deposits in connection with tenders,
               contracts, or leases to which the Borrower or any Subsidiary is a party or other
               cash deposits required to be made in the ordinary course of business, provided
               in each case that the obligation is not for borrowed money and that the
               obligation secured is not overdue or, if overdue, is being contested in good
               faith by appropriate proceedings which prevent enforcement of the matter under
               contest and adequate reserves have been established therefor; 

               

          		        (b)       
               mechanics’, workmen’s, materialmen’s, landlords’,
               carriers’, or other similar Liens arising in the ordinary course of
               business with respect to obligations which are not due or which are being
               contested in good faith by appropriate proceedings which prevent enforcement of
               the matter under contest; 

               

          		        (c)       
               the pledge of assets for the purpose of securing an appeal, stay or discharge in
               the course of any legal proceeding, provided that the aggregate amount of
               liabilities of the Borrower and its Subsidiaries secured by a pledge of assets
               permitted under this subsection, including interest and penalties thereon, if
               any, shall not be in excess of $1,000,000 at any one time outstanding; 

               

          		        (d)       
               Liens on equipment of the Borrower or any Subsidiary created solely for the
               purpose of securing indebtedness permitted by Section 8.7(b) hereof,
               representing or incurred to finance the purchase price of such Property,
               provided that no such Lien shall extend to or cover other Property of the
               Borrower or such Subsidiary other than the respective Property so acquired, and
               the principal amount of indebtedness secured by any such Lien shall at no time
               exceed the original purchase price of such Property, as reduced by repayments of
               principal thereon; 

               

          		        (e)       
               any interest or title of a lessor under any operating lease; 

               

-28-

          		        (f)       
               easements, rights-of-way, restrictions, and other similar encumbrances against
               real property incurred in the ordinary course of business which, in the
               aggregate, are not substantial in amount and which do not materially detract
               from the value of the Property subject thereto or materially interfere with the
               ordinary conduct of the business of the Borrower or any Subsidiary; and 

               

          		        (g)       
               Liens on the Property of a Foreign Subsidiary as security for indebtedness of
               such Foreign Subsidiary owing to a foreign bank permitted by Section 8.7(h)
               hereof. 

               

             Section 8.9.       
          Investments, Acquisitions, Loans and Advances. The Borrower shall not,
          nor shall it permit any Subsidiary to, directly or indirectly, make, retain, or
          have outstanding any investments (whether through purchase of stock or
          obligations or otherwise) in, or loans or advances to, any other Person, or
          acquire all or any substantial part of the assets or business of any other
          Person or division thereof; provided, however, that the foregoing shall
          not apply to nor operate to prevent: 

          		        (a)       
               investments in direct obligations of the United States of America or of any
               agency or instrumentality thereof whose obligations constitute full faith and
               credit obligations of the United States of America, provided that any such
               obligations shall mature within one year of the date of issuance thereof; 

               

          		        (b)       
               investments in commercial paper rated at least P-1 by Moody’s and at least
               A-1 by S&P maturing within one year of the date of issuance thereof; 

               

          		        (c)       
               investments in certificates of deposit issued by the Bank or by any United
               States commercial bank having capital and surplus of not less than $100,000,000
               which have a maturity of one year or less; 

               

          		        (d)       
               investments in repurchase obligations with a term of not more than 7 days
               for underlying securities of the types described in subsection (a) above
               entered into with any bank meeting the qualifications specified in
               subsection (c) above, provided all such agreements require physical
               delivery of the securities securing such repurchase agreement, except those
               delivered through the Federal Reserve Book Entry System; 

               

          		        (e)       
               investments in direct obligations of a state of the United States, or a
               municipality thereof, given the highest rating by both Moody’s and S&P,
               maturing not more than one year from the date of acquisition thereof; 

               

          		        (f)       
               investments in money market funds that invest principally, and which are
               restricted by their respective charters to invest principally, in investments of
               the type described in the immediately preceding subsections (a), (b), (c),
               (d), and (e) above; 

               

          		        (g)       
               investments made by the Borrower and its Domestic Subsidiaries from time to time
               in other Domestic Subsidiaries, and intercompany advances made by the Borrower
               and its Domestic Subsidiaries (other than Immaterial Subsidiaries) from time to 

               

-29-

          		time to other Domestic Subsidiaries (other than Immaterial Subsidiaries) in the
               ordinary course of business; 

               

          		        (h)       
               the Borrower’s investment existing on the date of this Agreement in its
               Foreign Subsidiaries; and additional investments in Foreign Subsidiaries made
               after the date of this Agreement, and intercompany advances by the Borrower and
               its Domestic Subsidiaries from time to time to Foreign Subsidiaries in the
               ordinary course of business, in an aggregate principal amount (for all such
               additional investments and all intercompany advances) not to exceed the US
               dollar equivalent of $50,000,000 at any one time outstanding; 

               

          		        (i)       
               travel advances and other similar cash advances made to employees in the
               ordinary course of business; 

               

          		        (j)       
               acquisitions by the Borrower or any Subsidiary (other than an Immaterial
               Subsidiary) of substantially all of the assets or business of any Person if
               (w) in the event such acquisition results in the formation or acquisition
               of a new Subsidiary, such Subsidiary is a Wholly-Owned Subsidiary upon
               consummation of such acquisition and, to the extent such Subsidiary is a
               Domestic Subsidiary, the Borrower has complied with Section 4 hereof with
               respect thereto, (x) at the time such acquisition is consummated and after
               giving effect thereto, no Default or Event of Default exists or would exist,
               (y) the Borrower will be in pro forma compliance with all the financial
               ratios and restrictions set forth in Section 8 after giving effect to such
               acquisition and (z) the board of directors or other governing body of any
               such Person proposed to be acquired has not announced that it will oppose such
               acquisition and has not commenced any litigation which alleges that such
               acquisition violates, or will violate, any requirement of law or any contractual
               obligation of such Person; and 

               

          		        (k)       
               other investments, loans and advances in addition to those otherwise permitted
               by this Section in an amount not to exceed $7,500,000 in the aggregate at any
               one time outstanding. 

               

In determining the
amount of investments, acquisitions, loans, and advances permitted under this Section,
investments and acquisitions shall always be taken at the original cost thereof
(regardless of any subsequent appreciation or depreciation therein), and loans and
advances shall be taken at the principal amount thereof then remaining unpaid. 

             Section 8.10.       
          Mergers, Consolidations and Sales. The Borrower shall not, nor shall it
          permit any Subsidiary to, be a party to any merger or consolidation, or sell,
          transfer, lease, or otherwise dispose of all or any part of its Property,
          including any disposition of Property as part of a sale and leaseback
          transaction, or in any event sell or discount (with or without recourse) any of
          its notes or accounts receivable; provided, however, that this Section
          shall not apply to nor operate to prevent: 

          		        (a)       
          the sale or lease of inventory in the ordinary course of business; 

-30-

          		        (b)       
               (i) the sale, transfer, lease, or other disposition of Property of the
               Borrower and its Domestic Subsidiaries to one another in the ordinary course of
               its business; and (ii)  the sale, transfer, lease, or other disposition of
               Property of any Foreign Subsidiary to another Foreign Subsidiary in the ordinary
               course of its business; 

               

          		        (c)       
               (i) the merger of any Domestic Subsidiary with and into the Borrower or any
               other Domestic Subsidiary provided that, in the case of any merger involving the
               Borrower, the Borrower is the corporation surviving the merger; and
               (ii) the merger of any Foreign Subsidiary with and into any other Foreign
               Subsidiary; 

               

          		        (d)       
               the sale of delinquent notes or accounts receivable in the ordinary course of
               business for purposes of collection only (and not for the purpose of any bulk
               sale or securitization transaction); 

               

          		        (e)       
               the sale, transfer, or other disposition of any tangible personal property that,
               in the reasonable business judgment of the Borrower or its Subsidiary, has
               become uneconomical, obsolete, or worn out, and which is disposed of in the
               ordinary course of business; and 

               

          		        (f)       
               the sale, transfer, lease, or other disposition of Property of the Borrower or
               any Subsidiary (including any disposition of Property as part of a sale and
               leaseback transaction) aggregating for the Borrower and its Subsidiaries not
               more than $30,000,000 during any fiscal year of the Borrower. 

               

             Section 8.11.       
          Maintenance of Subsidiaries. The Borrower shall not assign, sell or
          transfer, nor shall it permit any Subsidiary to issue, assign, sell or transfer,
          any shares of capital stock of a Subsidiary; provided, however, that the
          foregoing shall not operate to prevent (a) the issuance, sale and transfer
          to any person of any shares of capital stock of a Subsidiary solely for the
          purpose of qualifying, and to the extent legally necessary to qualify, such
          person as a director of such Subsidiary, and (b) any transaction permitted
          by Section 8.10 above. 

             Section 8.12.       
          ERISA. The Borrower shall, and shall cause each Subsidiary to, promptly
          pay and discharge all obligations and liabilities arising under ERISA of a
          character which if unpaid or unperformed could reasonably be expected to result
          in the imposition of a Lien against any of its Property. The Borrower shall, and
          shall cause each Subsidiary to, promptly notify the Bank of: (a) the
          occurrence of any reportable event (as defined in ERISA) with respect to a Plan,
          (b) receipt of any notice from the PBGC of its intention to seek
          termination of any Plan or appointment of a trustee therefor, (c) its
          intention to terminate or withdraw from any Plan, and (d) the occurrence of
          any event with respect to any Plan which would result in the incurrence by the
          Borrower or any Subsidiary of any material liability, fine or penalty, or any
          material increase in the contingent liability of the Borrower or any Subsidiary
          with respect to any post-retirement Welfare Plan benefit. 

             Section 8.13.       
          Compliance with Laws. The Borrower shall, and shall cause each Subsidiary
          to, comply in all respects with the requirements of all federal, state, local,
          and foreign laws, rules, regulations, ordinances and orders applicable to or
          pertaining to its Property or 

-31-

     business operations, where any such
          non-compliance, individually or in the aggregate, could reasonably be expected
          to have a Material Adverse Effect or result in a Lien upon any of its Property. 

             Section 8.14.       
          Burdensome Contracts With Affiliates. The Borrower shall not, nor shall
          it permit any Subsidiary to, enter into any contract, agreement or business
          arrangement with any of its Affiliates on terms and conditions which are less
          favorable to the Borrower or such Subsidiary than would be usual and customary
          in similar contracts, agreements or business arrangements between Persons not
          affiliated with each other. 

             Section 8.15.       
          No Changes in Fiscal Year. The Borrower shall not, nor shall it permit
          any Subsidiary to, change its fiscal year from its present basis without the
          Bank’s prior written consent. 

             Section 8.16.       
          Formation of Subsidiaries. Promptly upon the formation or acquisition of
          any Subsidiary, the Borrower shall provide the Bank notice thereof and timely
          comply with the requirements of Section 4 hereof. 

             Section 8.17.       
          Change in the Nature of Business. The Borrower shall not, nor shall it
          permit any Subsidiary to, engage in any business or activity if as a result the
          general nature of the business of the Borrower or any Subsidiary would be
          changed in any material respect from the general nature of the business engaged
          in by it as of the date hereof. 

             Section 8.18.       
          Use of Proceeds. The Borrower shall use the credit extended under this
          Agreement solely for the purposes set forth in, or otherwise permitted by,
          Section 6.4 hereof. 

             Section 8.19.       
          No Restrictions. Except as provided herein or in the Note Purchase
          Agreements dated as of September 1, 1998, between the Borrower and the
          Woodhead Finance Noteholders, the Borrower shall not, nor shall it permit any
          Subsidiary to, directly or indirectly create or otherwise cause or suffer to
          exist or become effective any consensual encumbrance or restriction of any kind
          on the ability of the Borrower or any Subsidiary to: (a) pay dividends or
          make any other distribution on any Subsidiary’s capital stock or other
          equity interests owned by the Borrower or any other Subsidiary, (b) pay any
          indebtedness owed to the Borrower or any other Subsidiary, (c) make loans
          or advances to the Borrower or any other Subsidiary, (d) transfer any of
          its Property to the Borrower or any other Subsidiary, or (e) guarantee the
          Obligations as required by the Loan Documents. 

             Section 8.20.       
          Financial Covenants. (a) Interest Coverage Ratio. As of the
          last day of each fiscal quarter of the Borrower, the Borrower shall not permit
          the Interest Coverage Ratio for the four fiscal quarters then ended to be less
          than 2.50 to 1.0. 

             (b)       
          Debt to EBITDA Ratio. As of the last day of each fiscal quarter of the
          Borrower, the Borrower shall not permit the Debt to EBITDA Ratio for the four
          fiscal quarters then ended to be more than 2.50 to 1.0. 

-32-

             (c)       
          Operating Leases. The Borrower will not, nor will it permit any
          Subsidiary to, acquire the use or possession of any Property under a lease or
          similar arrangement, whether or not the Borrower or any Subsidiary has the
          express or implied right to acquire title to or purchase such Property, at any
          time if, after giving effect thereto, the aggregate amount of fixed rentals and
          other consideration payable by the Borrower and its Subsidiaries under all such
          leases or arrangements would exceed $2,000,000 during any fiscal year of the
          Borrower. Capital Leases shall not be included in computing compliance with this
          Section. 

             Section 8.21.       
          Immaterial Subsidiaries. The Borrower shall not permit any Immaterial
          Subsidiary to engage in any trade or business (other than the transfer of assets
          to the Borrower or other Domestic Subsidiaries), or obtain any new assets. 

     SECTION 9.    EVENTS OF DEFAULT AND REMEDIES. 

             Section 9.1.       
          Events of Default. Any one or more of the following shall constitute an
          “Event of Default” hereunder: 

          		        (a)       
               default in the payment when due of all or any part of any Obligation payable by
               the Borrower hereunder or under any other Loan Document (whether at the stated
               maturity thereof or at any other time provided for in this Agreement), or
               default shall occur in the payment when due of any other indebtedness or
               obligation (whether direct, contingent or otherwise) of the Borrower owing to
               the Bank; or 

               

          		        (b)       
               default in the observance or performance of any covenant set forth in
               Sections 8.5, 8.7, 8.8, 8.9, 8.10, 8.11, 8.20 or 8.21 hereof; or 

               

          		        (c)       
               default in the observance or performance of any other provision hereof or of any
               other Loan Document which is not remedied within 30 days after the earlier
               of (i) the date on which such failure shall first become known to any
               officer of the Borrower or (ii) written notice thereof is given to the
               Borrower by the Bank; or 

               

          		        (d)       
               any representation or warranty made by the Borrower or any Subsidiary herein
               or in any other Loan Document, or in any statement or certificate furnished
               by it pursuant hereto or thereto, or in connection with any extension of credit
               made hereunder, proves untrue in any material respect as of the date of the
               issuance or making thereof; or 

               

          		        (e)       
               any event occurs or condition exists (other than those described in
               subsections (a) through (d) above) which is specified as an event of
               default under any of the other Loan Documents, or any of the Loan Documents
               shall for any reason not be or shall cease to be in full force and effect, or
               any of the Loan Documents is declared to be null and void, or any Subsidiary
               shall purport to disavow, revoke, repudiate, or terminate any Loan Document
               entered into by it or any of its obligations thereunder; or 

               

          		        (f)       
               default shall occur under any Indebtedness for Borrowed Money issued, assumed or
               guaranteed by the Borrower or any Subsidiary aggregating more than $500,000 or
               under any indenture, agreement or other instrument under which the same 

               

-33-

          		may be
               issued, and such default shall continue for a period of time sufficient to
               permit the acceleration of the maturity of any such Indebtedness for Borrowed
               Money (whether or not such maturity is in fact accelerated), or any such
               Indebtedness for Borrowed Money shall not be paid when due (whether by lapse of
               time, acceleration or otherwise); or 

               

          		        (g)       
               any judgment or judgments, writ or writs, or warrant or warrants of attachment,
               or any similar process or processes in an aggregate amount in excess of $500,000
               shall be entered or filed against the Borrower or any Subsidiary or against any
               of their Property and which remains unvacated, unbonded, unstayed or unsatisfied
               for a period of 30 days; or 

               

          		        (h)       
               the Borrower or any member of its Controlled Group shall fail to pay when due an
               amount or amounts aggregating in excess $500,000 which it shall have become
               liable to pay to the PBGC or to a Plan under Title IV of ERISA; or notice
               of intent to terminate a Plan or Plans having aggregate Unfunded Vested
               Liabilities in excess of $500,000 (collectively, a “Material
               Plan”) shall be filed under Title IV of ERISA by the Borrower or
               any other member of its Controlled Group, any plan administrator or any
               combination of the foregoing; or the PBGC shall institute proceedings under
               Title IV of ERISA to terminate or to cause a trustee to be appointed to
               administer any Material Plan or a proceeding shall be instituted by a fiduciary
               of any Material Plan against the Borrower or any member of its Controlled Group
               to enforce Section 515 or 4219(c)(5) of ERISA and such proceeding shall not
               have been dismissed within 30 days thereafter; or a condition shall exist
               by reason of which the PBGC would be entitled to obtain a decree adjudicating
               that any Material Plan must be terminated; or 

               

          		        (i)       
               dissolution or termination of the existence of the Borrower or, except as
               permitted by Section 8 hereof, any Subsidiary; or 

               

          		        (j)       
               any Change of Control shall occur; or 

               

          		        (k)       
               the Borrower or any Subsidiary (other than an Immaterial Subsidiary) shall
               (i) have entered involuntarily against it an order for relief under the
               United States Bankruptcy Code, as amended, (ii) not pay, or admit in
               writing its inability to pay, its debts generally as they become due,
               (iii) make an assignment for the benefit of creditors, (iv) apply for,
               seek, consent to, or acquiesce in, the appointment of a receiver, custodian,
               trustee, examiner, liquidator or similar official for it or any substantial part
               of its Property, (v) institute any proceeding seeking to have entered
               against it an order for relief under the United States Bankruptcy Code, as
               amended, to adjudicate it insolvent, or seeking dissolution, winding up,
               liquidation, reorganization, arrangement, adjustment or composition of it or its
               debts under any law relating to bankruptcy, insolvency or reorganization or
               relief of debtors or fail to file an answer or other pleading denying the
               material allegations of any such proceeding filed against it, (vi) take any
               corporate action in furtherance of any matter described in parts (i) through (v)
               above, or (vii) fail to contest in good faith any appointment or proceeding
               described in Section 9.1(l) hereof; or 

               

-34-

          		        (l)       
               a custodian, receiver, trustee, examiner, liquidator or similar official shall
               be appointed for the Borrower or any Subsidiary (other than an Immaterial
               Subsidiary) or any substantial part of any of their Property, or a proceeding
               described in Section 9.1(k)(v) shall be instituted against the Borrower or
               any Subsidiary (other than an Immaterial Subsidiary), and such appointment
               continues undischarged or such proceeding continues undismissed or unstayed for
               a period of 60 days. 

               

             Section 9.2.       
          Non-Bankruptcy Defaults. When any Event of Default described in
          subsection (a) through (j), both inclusive, of Section 9.1 has
          occurred and is continuing, the Bank may, by notice to the Borrower, take one or
          more of the following actions: 

          		        (a)       
               terminate the obligation of the Bank to extend any further credit hereunder on
               the date (which may be the date thereof) stated in such notice; 

               

          		        (b)       
               declare the principal of and the accrued interest on the Note to be forthwith
               due and payable and thereupon the Note, including both principal and interest
               and all fees, charges and other Obligations payable hereunder and under the
               other Loan Documents, shall be and become immediately due and payable without
               further demand, presentment, protest or notice of any kind; and 

               

          		        (c)       
               enforce any and all rights and remedies available to it under the Loan Documents
               or applicable law. 

               

             Section 9.3.       
          Bankruptcy Defaults. When any Event of Default described in
          subsection (k) or (l) of Section 9.1 has occurred and is continuing,
          then the Note, including both principal and interest, and all fees, charges and
          other Obligations payable hereunder and under the other Loan Documents, shall
          immediately become due and payable without presentment, demand, protest or
          notice of any kind, and the obligation of the Bank to extend further credit
          pursuant to any of the terms hereof shall immediately terminate. In addition,
          the Bank may exercise any and all remedies available to it under the Loan
          Documents or applicable law. 

             Section 9.4.       
          Collateral for Undrawn Letters of Credit. When any Event of Default,
          other than an Event of Default described in subsection (k) or (l) of
          Section 9.1, has occurred and is continuing, the Borrower shall, upon
          demand of the Bank, and when any Event of Default described in
          subsection (k) or (l) of Section 9.1 has occurred the Borrower shall,
          without notice or demand from the Bank, immediately pay to the Bank the full
          amount of each Letter of Credit then outstanding, the Borrower agreeing to
          immediately make such payment and acknowledging and agreeing that the Bank would
          not have an adequate remedy at law for failure of the Borrower to honor any such
          demand and that the Bank shall have the right to require the Borrower to
          specifically perform such undertaking whether or not any draws have been made
          under any such Letters of Credit. 

     SECTION 10.    MISCELLANEOUS. 

             Section 10.1.       
          Non-Business Day. If any payment hereunder becomes due and payable on a
          day which is not a Business Day, the due date of such payment shall be extended
          to the next 

-35-

     succeeding Business Day on which date such payment shall be due and
          payable. In the case of any payment of principal falling due on a day which is
          not a Business Day, interest on such principal amount shall continue to accrue
          during such extension at the rate per annum then in effect, which accrued amount
          shall be due and payable on the next scheduled date for the payment of interest. 

             Section 10.2.       
          No Waiver, Cumulative Remedies. No delay or failure on the part of the
          Bank or on the part of the holder of the Obligations in the exercise of any
          power or right shall operate as a waiver thereof or as an acquiescence in any
          default, nor shall any single or partial exercise of any power or right preclude
          any other or further exercise thereof or the exercise of any other power or
          right. The rights and remedies hereunder of the Bank and of the holder of the
          Obligations are cumulative to, and not exclusive of, any rights or remedies
          which any of them would otherwise have. 

             Section 10.3.       
          Amendments, Etc. No amendment, modification, termination or waiver of any
          provision of this Agreement or of any other Loan Document, nor consent to any
          departure by the Borrower therefrom, shall in any event be effective unless the
          same shall be in writing and signed by the Bank. No notice to or demand on the
          Borrower in any case shall entitle the Borrower to any other or further notice
          or demand in similar or other circumstances. 

             Section 10.4.       
          Costs and Expenses; Indemnification. The Borrower agrees to pay on demand
          the costs and expenses of the Bank in connection with the negotiation,
          preparation, execution and delivery of this Agreement, the other Loan
          Documents and the other instruments and documents to be
          delivered hereunder or thereunder, and in connection with the transactions
          contemplated hereby or thereby, and in connection with any consents hereunder or
          waivers or amendments hereto or thereto, including the fees and expenses of
          counsel for the Bank with respect to all of the foregoing (whether or not the
          transactions contemplated hereby are consummated). The Borrower further agrees
          to pay to the Bank or any other holder of the Obligations all costs and expenses
          (including court costs and attorneys’ fees), if any, incurred or paid by
          the Bank or any other holder of the Obligations in connection with any Default
          or Event of Default or in connection with the enforcement of this Agreement or
          any of the other Loan Documents or any other instrument or document
          delivered hereunder or thereunder. The Borrower further agrees to indemnify the
          Bank, and any security trustee, and their respective directors, officers and
          employees, against all losses, claims, damages, penalties, judgments,
          liabilities and expenses (including, without limitation, all expenses of
          litigation or preparation therefor, whether or not the indemnified Person is a
          party thereto) which any of them may pay or incur arising out of or relating to
          any Loan Document or any of the transactions contemplated thereby or the direct
          or indirect application or proposed application of the proceeds of any extension
          of credit made available hereunder, other than those which arise from the gross
          negligence or willful misconduct of the party claiming indemnification. The
          Borrower, upon demand by the Bank at any time, shall reimburse the Bank for any
          legal or other expenses incurred in connection with investigating or defending
          against any of the foregoing except if the same is directly due to the gross
          negligence or willful misconduct of the party to be indemnified. The obligations
          of the Borrower under this Section shall survive the termination of this
          Agreement. 

-36-

             Section 10.5.       
          Documentary Taxes. The Borrower agrees to pay on demand any documentary,
          stamp or similar taxes payable in respect of this Agreement or any other Loan
          Document, including interest and penalties, in the event
          any such taxes are assessed, irrespective of when such assessment is made and
          whether or not any credit is then in use or available hereunder. 

             Section 10.6.       
          Survival of Representations. All representations and warranties made
          herein or in any of the other Loan Documents or in certificates given pursuant
          hereto or thereto shall survive the execution and delivery of this Agreement and
          the other Loan Documents, and shall continue in full force and effect with
          respect to the date as of which they were made as long as any credit is in use
          or available hereunder. 

        Section 10.7.       Survival of Indemnities. All indemnities and other provisions relative to
reimbursement to the Bank of amounts sufficient to protect the yield of the Bank with
respect to the Loans, including, but not limited to, Sections 2.7 and 2.8 hereof,
shall survive the termination of this Agreement and the payment of the Note. 

             Section 10.8.       
          Notices. Except as otherwise specified herein, all notices hereunder
          shall be in writing (including, without limitation, notice by telecopy) and
          shall be given to the relevant party at its address or telecopier number set
          forth below, or such other address or telecopier number as such party may
          hereafter specify by notice to the other given by courier, by United States
          certified or registered mail, by telecopy or by other telecommunication device
          capable of creating a written record of such notice and its receipt. Notices
          hereunder shall be addressed: 

	to the Borrower at:	to the Bank at:
	 
	Woodhead Industries, Inc.	Harris Trust and Savings Bank
	3 Parkway North, Suite 550	111 West Monroe Street
	Deerfield, Illinois 60015	Chicago, Illinois 60603
	Attention: Joseph Nogal	Attention: Daniel K. Sabol
	Telephone: (847) 317-2419	Telephone: (312) 461-3766
	Telecopy: (847) 236-0503	Telecopy: (312) 293-5068

Each such notice,
request or other communication shall be effective (i) if given by telecopier, when
such telecopy is transmitted to the telecopier number specified in this Section and a
confirmation of such telecopy has been received by the sender, (ii) if given by mail,
five (5) days after such communication is deposited in the mail, certified or registered
with return receipt requested, addressed as aforesaid or (iii) if given by any other
means, when delivered at the addresses specified in this Section; provided that any
notice given pursuant to Section 1 or Section 2 hereof shall be effective only upon
receipt. 

             Section 10.9.       
          Construction. The provisions of this Agreement relating to Subsidiaries
          shall only apply during such times as the Borrower has one or more Subsidiaries.
          NOTHING CONTAINED HEREIN SHALL BE DEEMED OR CONSTRUED TO PERMIT ANY ACT OR
          OMISSION WHICH IS PROHIBITED BY THE TERMS OF ANY OF THE OTHER LOAN DOCUMENTS,
          THE COVENANTS AND AGREEMENTS CONTAINED HEREIN BEING IN ADDITION TO AND NOT IN

-37-

     SUBSTITUTION FOR THE COVENANTS AND AGREEMENTS CONTAINED IN THE OTHER LOAN
DOCUMENTS. 

             Section 10.10.       
          Headings. Section headings used in this Agreement are for convenience of
          reference only and are not a part of this Agreement for any other purpose. 

             Section 10.11.       
          Severability of Provisions. Any provision of this Agreement which is
          prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
          be ineffective to the extent of such prohibition or unenforceability without
          invalidating the remaining provisions hereof or affecting the validity or
          enforceability of such provision in any other jurisdiction. 

             Section 10.12.       
          Counterparts. This Agreement may be executed in any number of
          counterparts, and by different parties hereto on separate counterpart signature
          pages, and all such counterparts taken together shall be deemed to constitute
          one and the same instrument. 

             Section 10.13.       
          Binding Nature, Governing Law, Etc. This Agreement shall be binding upon
          the Borrower and its successors and assigns, and shall inure to the benefit of
          the Bank and the benefit of its successors and assigns, including any subsequent
          holder of the Obligations. The Borrower may not assign its rights hereunder
          without the written consent of the Bank. This Agreement constitutes the entire
          understanding of the parties with respect to the subject matter hereof and any
          prior agreements, whether written or oral, with respect thereto are superseded
          hereby. THIS AGREEMENT AND THE RIGHTS AND DUTIES OF THE PARTIES HERETO SHALL BE
          GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
          ILLINOIS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS. 

             Section 10.14.       
          Submission to Jurisdiction; Waiver of Jury Trial. The Borrower hereby
          submits to the nonexclusive jurisdiction of the United States District Court for
          the Northern District of Illinois and of any Illinois State court sitting in the
          City of Chicago for purposes of all legal proceedings arising out of or relating
          to this Agreement, the other Loan Documents or the transactions contemplated
          hereby or thereby. The Borrower irrevocably waives, to the fullest extent
          permitted by law, any objection which it may now or hereafter have to the laying
          of the venue of any such proceeding brought in such a court and any claim that
          any such proceeding brought in such a court has been brought in an inconvenient
          forum. THE BORROWER AND THE BANK EACH HEREBY IRREVOCABLY WAIVE ANY AND ALL RIGHT
          TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN
          DOCUMENT OR THE TRANSACTIONS CONTEMPLATED THEREBY. 

[SIGNATURE PAGE TO FOLLOW] 

-38-

        Upon
your acceptance hereof in the manner hereinafter set forth, this Agreement shall
constitute a contract between us for the uses and purposes hereinabove set forth. 

        Dated
as of this 28th day of April, 2004. 

		WOODHEAD INDUSTRIES, INC.
		 	
		 
		By  	/s/   Joseph P. Nogal
			

			Joseph P. Nogal
			Vice President, Treasurer/Controller
and Assistant Secretary

        Accepted
and agreed to at Chicago, Illinois, as of the day and year last above written. 

		HARRIS TRUST AND SAVINGS BANK
		 	
		 
		By  	/s/   Danjuma Gibson
			

			Danjuma Gibson
			Vice President

-39-

EXHIBIT A 

REVOLVING NOTE 

		Chicago, Illinois
	$25,000,000.00	April 28, 2004

        On
the Termination Date, for value received, the undersigned, WOODHEAD INDUSTRIES, INC., a
Delaware corporation (the “Borrower”), hereby promises to pay to
the order of HARRIS TRUST AND SAVINGS BANK (the “Bank”) at its office at
111 West Monroe Street, Chicago, Illinois, the principal sum of (i) TWENTY-FIVE
MILLION AND NO/100 DOLLARS ($25,000,000.00), or (ii) such lesser amount as may at the
time of the maturity hereof, whether by acceleration or otherwise, be the aggregate unpaid
principal amount of all Loans owing from the Borrower to the Bank under the Revolving
Credit provided for in the Credit Agreement hereinafter mentioned. 

        This
Note evidences Loans made and to be made to the Borrower by the Bank under the Revolving
Credit provided for under that certain Credit Agreement dated as of April 28, 2004,
between the Borrower and the Bank (said Credit Agreement, as the same may be amended,
modified or restated from time to time, being referred to herein as the “Credit
Agreement”), and the Borrower hereby promises to pay interest at the office
described above on such Loans evidenced hereby at the rates and at the times and in the
manner specified therefor in the Credit Agreement. 

        This
Note is issued by the Borrower under the terms and provisions of the Credit Agreement, and
this Note and the holder hereof are entitled to all of the benefits provided for thereby
or referred to therein, to which reference is hereby made for a statement thereof. This
Note may be declared to be, or be and become, due prior to its expressed maturity and
voluntary prepayments may be made hereon, all in the events, on the terms and with the
effects provided in the Credit Agreement. All capitalized terms used herein without
definition shall have the same meanings herein as such terms are defined in the Credit
Agreement. 

        The
Borrower hereby promises to pay all costs and expenses (including reasonable
attorneys’ fees) suffered or incurred by the holder hereof in collecting this Note or
enforcing any rights in any collateral therefor. The Borrower hereby waives presentment
for payment and demand. THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY,
THE INTERNAL LAWS OF THE STATE OF ILLINOIS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAWS. 

		WOODHEAD INDUSTRIES, INC.
		 	
		 
		By  	/s/   Joseph P. Nogal
			

			Joseph P. Nogal
			Vice President, Treasurer/Controller
and Assistant Secretary

EXHIBIT B 

COMPLIANCE CERTIFICATE 

To: HARRIS TRUST AND SAVINGS BANK 

        This
Compliance Certificate is furnished to Harris Trust and Savings Bank (the
“Bank”) pursuant to that certain Credit Agreement dated as of
April 28, 2004, between Woodhead Industries, Inc., and the Bank (the “Credit
Agreement”). Unless otherwise defined herein, the terms used in this Compliance
Certificate have the meanings ascribed thereto in the Credit Agreement. 

         THE
UNDERSIGNED HEREBY CERTIFIES THAT:

          		    1.       
I am the duly elected _____________________________________ of the Borrower; 

          		    2.       
               I have reviewed the terms of the Credit Agreement and I have made, or have
               caused to be made under my supervision, a detailed review of the transactions
               and conditions of the Borrower and its Subsidiaries during the accounting period
               covered by the attached financial statements; 

               

          		    3.       
               The examinations described in paragraph 2 did not disclose, and I have no
               knowledge of, the existence of any condition or the occurrence of any event
               which constitutes a Default or Event of Default during or at the end of the
               accounting period covered by the attached financial statements or as of the date
               of this Certificate, except as set forth below; 

               

          		    4.       
               The financial statements required by Section 8.5 of the Credit Agreement
               and being furnished to you concurrently with this certificate are, to the best
               of my knowledge, true, correct and complete as of the dates and for the periods
               covered thereby; and 

               

          		    5.       
               The Attachment hereto sets forth financial data and computations evidencing the
               Borrower’s compliance with certain covenants of the Credit Agreement, all
               of which data and computations are, to the best of my knowledge, true, complete
               and correct and have been made in accordance with the relevant Sections of the
               Credit Agreement. 

               

        Described
below are the exceptions, if any, to paragraph 3 by listing, in detail, the nature of
the condition or event, the period during which it has existed and the action which the
Borrower has taken, is taking, or proposes to take with respect to each such condition or
event: 

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

        The foregoing
certifications,  together with the computations set forth in the Attachment  hereto and the
financial  statements  delivered with this Certificate in support hereof, are made and delivered this _________ day
of __________________, ___.

		WOODHEAD INDUSTRIES, INC.
		 
		 
		By                                                                                            
		    Name                                                                                   
		    Title                                                                                     

ATTACHMENT TO
COMPLIANCE CERTIFICATE 

WOODHEAD INDUSTRIES,
INC. 

Compliance Calculations
for Credit Agreement 

Dated as of
April 28, 2004 

Calculations as of
_____________, ___ 

	A.	INTEREST COVERAGE RATIO (SECTION 8.20)
	 
		1.	Consolidated Net Earnings as defined
	_________	
	 
		2.	Amounts deducted in arriving at
Consolidated Net Income in respect of	
	 
	 	 	(a)    Interest Expense	_________
	 
	 	 	(b)    Taxes imposed on or measured by income or
	 	 	         excess profits	_________
	 
	 	3.	Sum of Lines A1, A2(a), and A2(b) ("EBIT")	 	_________
	 
	 	4.	Interest Expense	_________
	 
	 	5.	Ratio of Line A3 to Line A4 ("INTEREST COVERAGE RATIO")		__:1.0
	 
	 	6.	As specified in Section 8.20, the Interest
Coverage Ratio shall not be less than	 	
2.5:1.0
	 
	 	7.	Borrower is in compliance?
	 	 	(Circle yes or no)	 	Yes/No
	 
	B.	DEBT TO EBITDA RATIO (SECTION 8.20)
	 
	 	1.	Funded Debt as defined	_________
	 
	 	2.	Consolidated Net Earnings as defined	_________
	 
	 	3.	Amounts deducted in arriving at Consolidated Net
	 	 	Income in respect of	 

	 
	 	 	(a)    Interest Expense	_________	 
	 
	 	 	(b)    Taxes imposed on or measured by income or	_________
	 	 	         excess profits
	 
	 	 	(c)    Depreciation and Depletion	_________
	 
	 	 	(d)    Amortization	_________
	 
	 	4.	Sum of Lines B2, B3(a), B3(b), B3(c) and B3(d)	 	_________
	 
	 	5.	Ratio of Line B1 to Line B4 ("DEBT TO EBITDA RATIO")	 	___:1.0
	 
	 	6.	As specified in Section 8.20, the Debt to EBITDA	 
	 	 	Ratio shall not be more than	 	2.5:1.0
	 
	 	7.	Borrower is in compliance?
	 	 	(Circle yes or no)	 	Yes/No

SCHEDULE 6.2 

SUBSIDIARIES 

	NAME	JURISDICTION OF
INCORPORATION	PERCENTAGE
OWNERSHIP
	 
	Aero-Motive Company	State of Michigan	100%
	Advanced Interconnect, Inc.	State of Delaware	100%
	Central Rubber Company	State of Illinois	100%
	DW Holding, L.L.C	State of Delaware	100%
	Daniel Woodhead Company	State of Delaware	100%
	Deerfield Partners C.V	The Netherlands	100%
	I.M.A. S.r.l	Italy	100%
	mPm S.r.l	Italy	100%
	WH One, LLC	State of Delaware	100%
	WH Two, LLC	State of Delaware	100%
	Woodhead Asia Pte. Ltd.	Singapore	100%
	Woodhead Canada Limited	Province of Nova Scotia	100%
	Woodhead Connectivity Limited	United Kingdom	100%
	Woodhead Connectivity GmbH	Germany	100%
	Woodhead Connectivity, S.A.S	France	100%
	Woodhead de Mexico S.A. de C.V	Mexico	100%
	Woodhead Finance Company	Province of Nova Scotia	100%
	Woodhead France S.A.R.L	France	100%
	Woodhead International B.V	The Netherlands	100%
	Woodhead Japan Corporation	Japan	100%
	Woodhead L.P.	State of Texas	100%
	Woodhead Software & Electronics, S.A.S.U	France	100%
	(f/k/a applicom International, S.A.S.)
	Euroview Services S.A	France	37%
	Micromedia S.A	France	33%

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