Document:

Exhibit 10.1

 

MATHSTAR,
INC.

AMENDED AND
RESTATED

2004
LONG-TERM INCENTIVE PLAN

 

Effective
Date:  October 8, 2004

 

 

MATHSTAR,
INC.

AMENDED AND
RESTATED

2004
LONG-TERM INCENTIVE PLAN

 

Table of
Contents

 

	
  Section

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  1.   Purpose of
  the Plan

  	
   

  	
  1

  
	
   

  	
   

  	
   

  
	
  2.   Definitions

  	
   

  	
  1

  
	
   

  	
   

  	
   

  
	
  3.   Shares  Subject to the Plan

  	
   

  	
  3

  
	
   

  	
   

  	
   

  
	
  4.   Administration

  	
   

  	
  4

  
	
   

  	
   

  	
   

  
	
  5.   Term of Plan

  	
   

  	
  5

  
	
   

  	
   

  	
   

  
	
  6.   Terms and Conditions of Qualified Options

  	
   

  	
  5

  
	
   

  	
   

  	
   

  
	
  7.   Terms and
  Conditions of Non-Qualified Options

  	
   

  	
  8

  
	
   

  	
   

  	
   

  
	
  8.   Automatic Grants of Director Options to Non-employee Directors

  	
   

  	
  11

  
	
   

  	
   

  	
   

  
	
  9.   Terms and
  Conditions of Stock Appreciation Rights

  	
   

  	
  14

  
	
   

  	
   

  	
   

  
	
  10.   Awards of
  Restricted Stock

  	
   

  	
  16

  
	
   

  	
   

  	
   

  
	
  11.   Other Awards

  	
   

  	
  18

  
	
   

  	
   

  	
   

  
	
  12.  Performance-Based
  Awards

  	
   

  	
  19

  
	
   

  	
   

  	
   

  
	
  13.  Adjustments Upon
  Certain Events

  	
   

  	
  20

  
	
   

  	
   

  	
   

  
	
  14.  Shares Acquired
  for Investment

  	
   

  	
  22

  
	
   

  	
   

  	
   

  
	
  15.  No Right to
  Employment, Service as a Director or Awards

  	
   

  	
  22

  
	
   

  	
   

  	
   

  
	
  16.  Other Benefit and
  Compensation Programs

  	
   

  	
  23

  
	
   

  	
   

  	
   

  
	
  17.  Successors and
  Assigns

  	
   

  	
  23

  
	
   

  	
   

  	
   

  
	
  18.  Nontransferability
  of Awards; Designation of Beneficiary

  	
   

  	
  23

  
	
   

  	
   

  	
   

  
	
  19.  Amendments or
  Termination

  	
   

  	
  24

  
	
   

  	
   

  	
   

  
	
  20.  International
  Participants

  	
   

  	
  24

  
	
   

  	
   

  	
   

  
	
  21.  General

  	
   

  	
  24

  
	
   

  	
   

  	
   

  
	
  22.  Effective Date

  	
   

  	
  25

  

 

ii

 

MATHSTAR,
INC.

AMENDED AND
RESTATED

2004
LONG-TERM INCENTIVE PLAN

 

1.                                      Purpose of the Plan

 

The
purpose of the Plan is to aid the Company and its Affiliates in recruiting and
retaining employees, directors, independent contractors and other service
providers to the Company and to motivate such employees, directors, independent
contractors and other service providers to exert their best efforts on behalf
of the Company and its Affiliates by providing incentives through the granting
of Awards. The Company expects that it will benefit from the stock ownership
opportunities and other benefits provided to such Participants under this Plan
to encourage alignment of their interest in the Company’s success with that of
other stakeholders.

 

2.                                      Definitions

 

The following capitalized
terms used in the Plan have the respective meanings set forth in this Section;
other terms are defined elsewhere in the Plan:

 

(a)                                “Affiliate” means a Parent or Subsidiary.

 

(b)                               “Award” means an Option, Stock
Appreciation Right, Share of Restricted Stock, Other Stock-Based Award or Other
Cash-Based Award granted pursuant to the Plan.

 

(c)                                “Board”
means the
Board of Directors of the Company.

 

(d)                               “Code” means the
Internal Revenue Code of 1986, as amended, or any successor thereto.

 

(e)                                “Committee” means the Compensation Committee of the Board
or, if the Board has not appointed a separate Compensation Committee, the
entire Board.

 

(f)                                  “Common Stock” means the Company’s common
stock, $0.01 par value per share.

 

(g)                               “Company” means MathStar, Inc., a Minnesota
corporation.

 

(h)                               “Director” means a member of the Board of Directors of
the Company.

 

(i)                                   “Director Option” means a Non-Qualified
Option granted to a Director to a Director pursuant to Section 8.

 

(j)                                   “Effective Date” means the earlier of the
date the Company’s initial public offering is declared effective by the
Securities and Exchange Commission or December 31, 2005.

 

(k)                                “Employee” means any person, including officers and
Directors, employed by the Company or any Subsidiary.  The payment to a Director by the Company of
directors’ fees shall not be sufficient to constitute employment by the
Company.

 

 

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

 

(m)                             “Exercise Price”  means the
purchase price per Share under the terms of an Option.

 

(n)                               “Fair Market Value” means, on a given date, (i) if the Common Stock is listed or
admitted to unlisted trading privileges on any national securities exchange,
the average of the closing sales prices of the Common Stock on the end of any
day on all national securities exchanges on which the Common Stock may at the
time be listed or, if there have been no sales on any such exchange on any day,
the average of the highest bid and lowest asked prices on all such exchanges at
the end of such day or, (ii) if the Common Stock is not so listed or
admitted but transactions in the Common Stock are reported on The NASDAQ Stock
Market, the closing price quoted on The NASDAQ Stock Market on such day, or (iii) if
the Common Stock is not so listed or admitted to unlisted trading privileges or
quoted on The NASDAQ Stock Market, and bid and asked prices therefor in the
domestic over-the-counter market are reported by Pink Sheets LLC (or any
comparable reporting service), the average of the closing bid and asked prices
on such day as reported by Pink Sheets LLC (or any comparable reporting
service), or (iv) if the Common Stock is not listed on any national
securities exchange or quoted on The NASDAQ Stock Market or in the domestic
over-the-counter market, the fair value of the Common Stock determined by the
Committee in good faith in the exercise of its reasonable discretion.

 

(o)                               “Non-employee Director” means a Director who is not an Employee of the Company.

 

(p)                               “Non-Qualified Option” means a stock option
granted pursuant to Section 7 that does not qualify as an incentive stock
option as defined in Section 422 of the Code.

 

(q)                               “Option” means a Qualified Option or a Non-Qualified Option
(including a Director Option).

 

(r)                                  “Other Stock-Based Awards” means Awards granted
pursuant to Section 11(a) or Section 12.

 

(s)                                “Other Cash-Based Awards” means Awards
granted pursuant to Section 11(b) or Section 12.

 

(t)                                  “Parent” means any “parent corporation” of the Company, as
such term is defined in Section 424(e) of the Code or any successor
provision.  The term shall include any
Parent which becomes such after adoption of the Plan.

 

(u)                               “Participant” means an employee of the
Company or an Affiliate who is selected by the Committee to participate in the
Plan; a Director of the Company who receives Director Options or other Awards
under the Plan; or any consultant, agent, advisor or independent contractor who
is selected by the Committee to participate in the Plan and who renders bona
fide services to the Company or an Affiliate that (i) are not in connection
with the offer and sale of the Company’s 

 

2

 

securities in a capital-raising transaction
and (ii) do not directly or indirectly promote or maintain a market for
the Company’s securities.  Except where
the context otherwise requires, references in this Plan to “employment” and
related terms shall apply to services in any such capacity.

 

(v)                               “Performance-Based Awards” means Options, Awards of
Restricted Stock, Other Stock-Based Awards and Other Cash-Based Awards granted
pursuant to Section 12.

 

(w)                             “Performance-Based
Full-Value Awards” means  all Performance-Based Awards
other than Options and Stock Appreciation Rights.

 

(x)                                 “Plan”  means this
MathStar, Inc. 2004 Long-Term Incentive Plan, as amended or supplemented
from time to time.

 

(y)                               “Qualified Option” means a stock option
granted pursuant to Section 6 that is intended to qualify as an incentive
stock option under Section 422 of the Code.

 

(z)                                 “Restricted Stock” means any shares of Common
Stock granted under Section 10.

 

(aa)                          “Stock Appreciation Right” means a stock appreciation
right granted pursuant to Section 9.

 

(bb)                        “Subsidiary”  means any “subsidiary
corporation” of the Company, as such term is defined in Section 424(f) of
the Code.  The term shall include any
Subsidiary which becomes such after adoption of the Plan.

 

(cc)                          “Tenure-Based Full-Value
Awards” means Awards other than Options and Stock
Appreciation Rights that are not Performance-Based Awards.

 

3.                                      Shares  Subject to the
Plan

 

                        The total number of shares of Common Stock which may be issued under the
Plan is 1,200,000 shares.  The full
number of shares of Common Stock available under the Plan may be used for any
Option or other type of Award.  The
aggregate number of shares of Common Stock available under the Plan shall be
subject to adjustment upon the occurrence of any of the events and in the
manner set forth in Section 13.  If
all or any potion of an Option or Stock Appreciation Right expires or is
terminated, surrendered or cancelled without having been fully exercised, if
Restricted Stock is forfeited, or if any other grant of an Award results in any
shares of Common Stock not being issued, the shares of Common Stock covered by
such Award shall again be available for the grant of Awards under the
Plan.  Any shares of Common Stock which
are used as full or partial payment to the Company upon exercise of an Option
or for any other Award that requires a payment to the Company and any shares
surrendered or withheld to pay employment taxes or other withholding
obligations also shall be available for the grant of Awards under the
Plan.  The issuance of shares of Common
Stock upon the exercise or satisfaction of an Award shall reduce the total
number of shares of Common Stock available under the Plan.  No fractional shares of Common Stock will be
issued under the Plan, but instead any fractional Share will be rounded
downward to the next lowest whole Share.

 

3

 

4.                                      Administration

 

(a)                                  Delegation of Authority.  The Plan shall be administered by the
Committee.  The Committee shall consist
of the Board, unless the Board appoints a Committee consisting of at least two
but fewer than all the members of the Board. 
If the Committee does not consist of the entire Board, the Committee’s
members shall serve at the pleasure of the Board, which may from time to time
appoint members in substitution for members previously appointed and fill
vacancies, however caused, in the Committee. 
The Committee may select one of its members as its Chairperson and shall
hold its meetings at such times and places as it may determine.  A majority of the Committee’s members shall
constitute a quorum.  All determinations
of the Committee made at a meeting in which a quorum is present shall be made
by a majority of its members present at the meeting.  Any decision or determination of the
Committee reduced to writing and signed by a majority of the members shall be
fully as effective as if it had been made by a majority vote at a meeting duly
called and held.

 

(b)                                 Authority of Committee. 
The Committee shall have exclusive power to make Awards and to determine
when and to whom Awards shall be granted, and the form, amount and other terms
and conditions of each Award, subject to the provisions of this Plan and any
applicable law or regulation.  The
Committee may determine whether, to what extent and under what circumstances
Awards may be settled, paid or exercised in cash, shares of Common Stock or other Awards or other property, or cancelled,
forfeited or suspended.  The Committee
shall have the authority to interpret this Plan and any Award or agreement made
under this Plan, to establish, amend, waive and rescind any rules and
regulations relating to the administration of this Plan, to determine the terms
and provisions of any agreements entered into hereunder (not inconsistent with
this Plan), and to make all other determinations necessary or advisable for the
administration of this Plan.  The Committee
may correct any defect, supply any omission or reconcile any inconsistency in
this Plan or in any Award or agreement in the manner and to the extent it shall
deem desirable.  The determinations of
the Committee in the administration of this Plan, as described herein, shall be
final, binding and conclusive.

 

(c)                                  Indemnification. 
To the full extent permitted by law, each member and former member of
the Committee and each person to whom the Committee delegates or has delegated
authority under this Plan shall be entitled to indemnification by the Company
against and from any loss, liability, judgment, damages, cost and reasonable
expense incurred by such member, former member or other person by reason of any
action taken, failure to act or determination made in good faith under or with
respect to this Plan.

 

(d)                                 Tax Withholding.  The Committee shall have the
right to require payment by a Participant of any amount it may determine to be
necessary to withhold for federal, state, local, non-U.S. income, payroll or
other taxes as a result of the exercise, grant or vesting of an Award.  With the consent of the Committee, the
Participant may pay a portion or all of such withholding taxes by delivering
shares of Common Stock to the Company or having the Company withhold shares of
Common Stock with a Fair Market Value or cash equal to the amount of such taxes
that would have otherwise been payable by the Participant.

 

4

 

(e)                                  Deferral.  In
the discretion of the Committee, in accordance with any procedures established
by the Committee and consistent with the provisions of Section 162(m) of
the Code when applied to Participants who may be “covered employees”
thereunder, a Participant may be permitted to defer the issuance of shares of
Common Stock or cash deliverable upon the exercise of an Option or Stock
Appreciation Right, vesting of Restricted Stock, or satisfaction of Other
Stock-Based Awards or Other Cash-Based Awards, for a specified period or until
a specified date, but not beyond the expiration of the term of such Option,
Stock Appreciation Right, Restricted Stock grant, or other Award.

 

(f)                                    Dividends or Dividend Equivalents.  If the Committee so determines, any Award
granted under the Plan may be credited with dividends or dividend equivalents
paid with respect to any underlying shares of Common Stock.  The Committee may apply any restrictions to
the dividends or dividend equivalents that the Committee deems appropriate and
may determine the form of payment, including cash, shares of Common Stock,
Restricted Stock or otherwise.

 

5.                                      Term of Plan

 

This Plan shall commence on October 8,
2004 (the “Effective Date”) and shall terminate on October 7, 2014 or at
such earlier date as the Board of Directors shall determine.  The termination of this Plan shall not affect
any Awards then outstanding under the Plan. 
No Award may be granted under the Plan after October 7, 2014.

 

6.                                      Terms and Conditions of Qualified Options

 

                Options granted under the
Plan may be Qualified Options.  When the
Committee approves a grant of a Qualified Option to a Participant, it shall
prepare or cause to be prepared an option agreement (“Qualified Option
Agreement”) setting forth the terms of the Qualified Option, and such Qualified
Option Agreement shall be signed on behalf of the Company and by the
Participant.  Qualified Options granted
under this Plan shall be subject to the foregoing and to the following terms
and conditions and to such other terms and conditions, not inconsistent
therewith, as the Committee shall determine:

 

(a)                                  Number of Shares and Exercise Price.  The Qualified Option Agreement shall state
the total number of shares of Common Stock subject to the Qualified Option it
evidences, the Exercise Price per share of Common Stock and the other terms of
the Qualified Option.  The number of
shares of Common Stock subject to the Qualified Option and the Exercise Price
shall be adjustable as provided in Section 12(a) of this Plan.

 

(b)                                 Exercisability; Term.  Qualified Options granted under the Plan
shall be exercisable at such time(s) and upon such terms and conditions as
may be determined by the Committee. 
However, subject to Section 6(l), a Qualified Option shall not be
exercisable more than ten (10) years after the date it is granted.  The period during which a Qualified Option may
be exercised once it is granted may not be reduced, except as provided in
Sections 6(e), (f) and (g) of this Plan.

 

5

 

(c)                                  Exercise of Qualified Options. Except as otherwise
provided in the applicable Qualified Option Agreement, a Qualified Option may
be exercised for all, or from time to time any part, of the shares of Common
Stock for which it is then exercisable. 
For purposes of this Section 6, the exercise date of a Qualified
Option shall be the date a written notice of exercise and full payment of the
purchase price are received by the Company in accordance with this Section 6(c) and
Section 6(d) below.  The
purchase price for the shares of Common Stock as to which a Qualified Option is
exercised shall be paid to the Company in cash or its equivalent, such as by
check or wire transfer, or, if provided in the Qualified Option Agreement or
with the consent of the Committee:  (i) in
shares of Common Stock having a Fair Market Value equal to the aggregate Exercise
Price of the shares of Common Stock being purchased and satisfying such other
requirements as may be imposed by the Committee; provided, that such shares
were then purchased on the open market or have been held by the Participant for
at least six months (or such other period as established from time to time by
the Committee in order to avoid adverse accounting treatment under generally
accepted accounting principles); (ii) partly in cash and partly in such
shares; or (iii) if there is a public market for the shares of Common
Stock at such time, through the delivery of irrevocable instructions to a
broker to sell shares of Common Stock obtained upon the exercise of the
Qualified Option and to deliver promptly to the Company an amount out of the
proceeds of such sale equal to the aggregate Exercise Price for the shares
being purchased.

 

(d)                                 Manner of Exercise of Qualified Options.  A Qualified Option shall be exercised only by
the Participant (i) delivering a completed and signed written notice of
exercise to the Company in the form prescribed by the Company specifying the
number of shares of Common Stock as to which the Qualified Option is being
exercised; (ii) delivering the original Qualified Option Agreement to the
Company; and (iii) paying to the Company the full amount of the Exercise
Price for the number of shares of Common Stock with respect to which the
Qualified Option is being exercised as provided in Section 6(c) above.  When shares of Common Stock are issued to the
Participant upon the exercise of that Participant’s Qualified Option, the fact
of such issuance shall be noted on the Qualified Option Agreement by the
Company before the Qualified Option Agreement is returned to the
Participant.  When all shares of Common
Stock covered by the Qualified Option Agreement have been issued by the Company
to the Participant or when the Qualified Option expires, the Participant shall
deliver the Qualified Option Agreement to the Company, which shall cancel
it.  After the receipt by the Company of
the written notice of exercise and payment in full of the Exercise Price in
accordance with Sections 6(c) and 6(d), the Company shall deliver to the
Participant exercising the Qualified Option stock certificates evidencing the
number of shares with respect to which the Qualified Option has been exercised,
issued in the Participant’s name; provided, however, that such delivery shall
be deemed effective for all purposes when the Company or its stock transfer
agent (if any) has deposited such stock certificates in the United States mail,
postage prepaid, addressed to the Participant at the address specified in the
written notice of exercise.

 

6

 

(e)                                  Termination of Employment or Service.  If a Participant who holds a Qualified Option
shall cease to be employed by or performing services for the Company or any
Affiliate for any reason other than death, unless the applicable Qualified
Option Agreement provides otherwise, such Qualified Option shall immediately
and automatically terminate and be forfeited, whether or not exercisable, and
neither such Participant nor any of the Participant’s heirs, personal
representatives, successors or assigns shall have any rights with respect to
such Qualified Option.  Notwithstanding
the foregoing, if an independent contractor or other non-employment
relationship between the Participant and the Company or an Affiliate is
terminated due to the commencement of an employment relationship with the
Company or an Affiliate, this provision shall apply only upon termination of
both the independent contractor and employment relationship between the
Participant and the Company or an Affiliate. 
In the case of a Participant who is a natural person and who ceases to be
employed by or performing services for the Company or an Affiliate due to his
or her disability (with disability being determined in the sole discretion of
the Committee), the Committee, at its discretion, may permit exercise of the
portion of the Qualified Option that is exercisable upon such termination of
employment until the earlier of the originally stated date of termination of
the Qualified Option or up to one (1) year after such termination of
employment or other service.

 

(f)                                    Death of Participant.  Unless otherwise provided in the applicable
Qualified Option Agreement, if a Participant who is a natural person shall
cease to be employed by or performing services for the Company or any Affiliate
as a result of the Participant’s death, any Qualified Option held by such
Participant may be exercised to the same extent that the Participant would have
been entitled to exercise it at the date of death and may be exercised within a
period of one (1) year after the date of death, but in no case later than
the expiration date of such Qualified Option. 
Such Qualified Option shall be exercised pursuant to Sections 6(c) and
(d) of this Plan by the person or persons to whom the Participant’s rights
under the Qualified Option shall pass by will or the laws of descent and
distribution.

 

(g)                                 Termination of Qualified Options Not Exercisable.  Unless the applicable Qualified Option
Agreement provides otherwise, upon termination of a Participant’s employment or
other services with the Company or an Affiliate for any reason, including by
reason of death or disability of the Participant, any portion of the
Participant’s Qualified Option that is not exercisable shall automatically and
immediately terminate as to such Participant, and the shares of Common Stock
subject to such portion of the Qualified Option shall be available for the
grant of Awards under the Plan.

 

(h)                                 No Obligation to Exercise Qualified Option.  The grant of a Qualified Option under the
Plan shall impose no obligation on the Participant to exercise such Qualified
Option.

 

(i)                                     Eligible Recipients.  Qualified Options may be granted only to
persons who are employees of the Company or an Affiliate.

 

7

 

(j)                                     Exercise Price.  Subject to the provisions of Section 6(l),
the exercise price of shares of Common Stock that are subject to a Qualified
Option shall not be less than 100% of the Fair Market Value of such shares at
the time the Qualified Option is granted, as determined in good faith by the
Committee.

 

(k)                                  Limit on Exercisability.  The aggregate Fair Market Value (determined
at the time the Qualified Option is granted) of the shares of Common Stock with
respect to which Qualified Options are exercisable by the Participant for the
first time during any calendar year, under this Plan or any other plan of the
Company or any Affiliate, shall not exceed $100,000.  To the extent a Qualified Option exceeds this
$100,000 limit, the portion of the Qualified Option in excess of such limit
shall be deemed a Non-Qualified Option.

 

(l)                                     Restrictions for Certain Shareholders.  The purchase price of shares of Common Stock
that are subject to a Qualified Option granted to an employee of the Company or
any Affiliate who, at the time such Qualified Option is granted, owns 10% or
more of the total combined voting power of all classes of stock of the Company
or of any Affiliate, shall not be less than 110% of the Fair Market Value of
such shares on the date such Qualified Option is granted, and such Qualified
Option may not be exercisable more than five (5) years after the date on
which it is granted.  For the purposes of
this subparagraph, the rules of Section 424(d) of the Code shall
apply in determining the stock ownership of any employee of the Company or any
Affiliate.

 

(m)                               Limits on Transferability and Exercise of Qualified Options.  Qualified Options shall not be transferable
except by will or the laws of descent and distribution, and Qualified Options
shall be exercisable during a Participant’s lifetime only by such Participant.

 

(n)                                 Effect of Not Meeting Requirements.  Subject to the discretion of the Committee to
provide otherwise, if the terms of a Qualified Option do not meet any
requirements of this Plan or the Code necessary to be treated as a Qualified
Option under the Code, such Qualified Option shall not terminate but shall be a
Non-Qualified Option granted under this Plan.

 

7.                                      Terms and Conditions of Non-Qualified Options

 

                Options granted under the Plan may be Non-Qualified
Options.  When the Committee approves
a grant of a Non-Qualified Option to a Participant, it shall prepare or cause
to be prepared an option agreement (“Non-Qualified Option Agreement”) setting
forth the terms of the Non-Qualified Option, and such Non-Qualified Option
Agreement shall be signed on behalf of the Company and by the Participant.  Non-Qualified Options granted under this Plan
shall be subject to
the foregoing and to the following terms and conditions and to such other terms
and conditions, not inconsistent therewith, as the Committee shall determine;
provided, however, that Non-Qualified Options that are Director Options
shall be governed by the provisions of Section 8 to the extent that they
are inconsistent with the provisions of this Section 7.

 

(a)                                  Number of Shares and Exercise Price.
 The Non-Qualified Option
Agreement shall state the total number of shares of Common Stock subject to the
Non-Qualified Option it evidences, the Exercise Price per share of Common Stock
and 

 

8

 

the other terms of the Non-Qualified
Option.  The Exercise Price of any
Non-Qualified Option may be less than, equal to or greater than Fair Market
Value.  The number of shares of Common
Stock subject to the Non-Qualified Option and the Exercise Price shall be
adjustable as provided in Section 13(a) of this Plan.

 

(b)                                 Exercisability; Term.  Non-Qualified Options
granted under the Plan shall be exercisable at such time(s) and upon such
terms and conditions as may be determined by the Committee, but in no event
shall a Non-Qualified Option be exercisable more than ten (10) years after
the date it is granted, except as the Committee may determine under Section 13(d) of
the Plan.  The period during which a
Non-Qualified Option may be exercised once it is granted may not be reduced,
except as provided in Sections 7(e), (f) and (g) of this Plan.

 

(c)                                  Exercise of Non-Qualified Options. Except as
otherwise provided in the applicable Non-Qualified Option Agreement, a Non-Qualified
Option may be exercised for all, or from time to time any part, of the shares
of Common Stock for which it is then exercisable.  For purposes of this Section 7, the
exercise date of a Non-Qualified Option shall be the date a written notice of
exercise and full payment of the purchase price are received by the Company in
accordance with this Section 7(c) and Section 7(d) below.  The purchase price for the shares of Common
Stock as to which a Non-Qualified Option is exercised shall be paid to the Company
in cash or its equivalent, such as by check or wire transfer or, if provided in
the Non-Qualified Option Agreement or with the consent of the Committee:  (i) in shares of Common Stock having a
Fair Market Value equal to the aggregate Exercise Price of the shares of Common
Stock being purchased and satisfying such other requirements as may be imposed
by the Committee; provided, that such shares were then purchased on the open
market or have been held by the Participant for at least six months (or such
other period as established from time to time by the Committee in order to
avoid adverse accounting treatment under generally accepted accounting
principles); (ii) partly in cash and partly in such shares; or (iii) if
there is a public market for the shares of Common Stock at such time, through
the delivery of irrevocable instructions to a broker to sell shares of Common
Stock obtained upon the exercise of the Non-Qualified Option and to deliver
promptly to the Company an amount out of the proceeds of such sale equal to the
aggregate Exercise Price for the shares being purchased.

 

(d)                                 Manner of Exercise of Non-Qualified Options.  A Non-Qualified Option shall be exercised
only by the Participant (i) delivering a completed and signed written
notice of exercise to the Company in the form prescribed by the Company
specifying the number of shares of Common Stock as to which the Non-Qualified
Option is being exercised; (ii) delivering the original Non-Qualified
Option Agreement to the Company; and (iii) paying to the Company the full
amount of the Exercise Price for the number of shares of Common Stock with
respect to which the Non-Qualified Option is being exercised as provided in Section 7(c) above.  When shares of Common Stock are issued to the
Participant upon the exercise of that Participant’s Non-Qualified Option, the
fact of such issuance shall be noted on the Non-Qualified Option Agreement by
the Company before the Non-Qualified Option Agreement is returned to the
Participant.  When all shares of Common
Stock covered by the Non-Qualified Option Agreement have been 

 

9

 

issued by the Company to the Participant or
when the Non-Qualified Option expires, the Participant shall deliver the
Non-Qualified Option Agreement to the Company, which shall cancel it.  After the receipt by the Company of the
written notice of exercise and payment in full of the Exercise Price in
accordance with Sections 7(c) and 7(d), the Company shall deliver to the
Participant exercising the Non-Qualified Option stock certificates evidencing
the number of shares with respect to which the Non-Qualified Option has been
exercised, issued in the Participant’s name; provided, however, that such
delivery shall be deemed effective for all purposes when the Company or its
stock transfer agent (if any) has deposited such stock certificates in the
United States mail, postage prepaid, addressed to the Participant at the
address specified in the written notice of exercise.

 

(e)                                  Termination of Employment or Service.  If a Participant who holds a Non-Qualified
Option shall cease to be employed by or performing services for the Company or
any Affiliate for any reason other than death, unless the applicable
Non-Qualified Option Agreement provides otherwise, such Non-Qualified Option
shall immediately and automatically terminate and be forfeited, whether or not
exercisable, and neither such Participant nor any of the Participant’s heirs,
personal representatives, successors or assigns shall have any rights with respect
to such Non-Qualified Option. 
Notwithstanding the foregoing, if an independent contractor or other
non-employment relationship between the Participant and the Company or an
Affiliate is terminated due to the commencement of an employment relationship
with the Company or an Affiliate, this provision shall apply only upon
termination of both the independent contractor and employment relationship
between the Participant and the Company or an Affiliate.  In the case of a Participant who is a natural
person and who ceases to be employed by or performing services for the Company
or an Affiliate due to his or her disability (with disability being determined
in the sole discretion of the Committee), the Committee, at its discretion, may
permit exercise of the portion of the Non-Qualified Option that is exercisable
upon such termination of employment until the earlier of the originally stated
date of termination of the Non-Qualified Option or up to one year after such
termination of employment or other service.

 

(f)                                    Death of Participant.  Unless otherwise provided in the applicable
Non-Qualified Option Agreement, if a Participant who is a natural person shall
cease to be employed by or performing services for the Company or any Affiliate
as a result of the Participant’s death, any Non-Qualified Option held by such
Participant may be exercised to the same extent that the Participant would have
been entitled to exercise it at the date of death and may be exercised within a
period of one (1) year after the date of death, but in no case later
than the expiration date of such Non-Qualified Option.  Such Non-Qualified Option shall be exercised
pursuant to Sections 7(c) and (d) of this Plan by the person or
persons to whom the Participant’s rights under the Non-Qualified Option shall
pass by will or the laws of descent and distribution.

 

(g)                                 Termination of Non-Qualified Options Not Exercisable.  Unless the applicable Non-Qualified Option
Agreement provides otherwise, upon termination of a 

 

10

 

Participant’s employment or other services
with the Company or an Affiliate for any reason, including by reason of death
or disability of the Participant, any portion of the Participant’s
Non-Qualified Option that is not exercisable shall automatically and
immediately terminate as to such Participant, and the shares of Common Stock
subject to such portion of the Non-Qualified Option shall be available for the
grant of Awards under the Plan.

 

(h)                                 No Obligation to Exercise Non-Qualified Option.  The grant of a Non-Qualified Option under the
Plan shall impose no obligation on the Participant to exercise such
Non-Qualified Option.

 

8.                                      Automatic Grants of Director Options to Non-employee Directors

 

(a)                                  Automatic Grants of Director Options.  Under the Plan, each Non-employee Director
shall automatically be granted Director Options to purchase shares of Common
Stock as follows:

 

(i)                                     Initial Grants of Director
Options. 
Each Non-employee Director will be granted an initial Option
(the “Initial Grant”) as follows:

 

A.                                   Non-Employee
Directors.  Each person
serving as a Non-employee Director on the Effective Date shall automatically be
granted a Director Option on such date to purchase five thousand (5,000) shares
of Common Stock.

 

B.                                     Future
Non-Employee Directors.  Each
person who is first elected or appointed to serve as a Non-employee Director
after the Effective Date shall automatically be granted a Director Option on
the date of his or her initial election or appointment to the Company’s Board
of Directors to purchase 5,000 shares of Common Stock.

 

C.                                     Vesting.  All Director Options granted under Sections
8(a)(i)(A) and (B) shall vest and become exercisable in cumulative
installments with respect to one-third (1/3) of the shares subject to such Director
Options on the first, second and third anniversary dates of the dates of grant
of such Director Options, but only if the holder of the Director Options is
then a Director of the Company.

 

(ii)                                  Additional
Grants of Director Options.  On each anniversary date of the Initial Grant
of a Director Option to a Non-employee Director under the Plan, such
Non-employee Director will automatically be granted an additional Option to
purchase one thousand (1,000) shares of Common Stock, but only if such person
is a Non-employee Director on such date. 
All Director Options granted under this Section 8(a)(ii) shall
vest and become exercisable as to all of the shares subject to the Director
Options one (1) year after the date of grant of such Director Option, but
only if the holder of the Director Options is then a Director of the Company.

 

11

 

(iii)          Termination of
Director Options.  Subject to
Sections 8(f), 8(g) and 8(h), all Director Options granted under this Section 8(a) shall
expire ten (10) years after the date of grant.

 

(iv)                              Exercise Price.  The exercise price of Director Options
granted under this Section 8(a) shall be equal to 100% of the Fair
Market Value of one share of Common Stock on the date of grant of the Director
Option.

 

(b)                                 Discretionary Grants.  In addition to the Director
Options granted pursuant to Section 8(a), a Director may be granted one or
more Options or other Awards under other provisions of the Plan, and such
Options or other Awards will be subject to such terms and conditions,
consistent with the other provisions of the Plan, as may be determined by the
Committee in its sole discretion.

 

(c)                                  Director Option Agreements.  When a Director Option is automatically
granted under Section 8(a), or when the Committee approves a grant of a
Director Option, the Committee shall prepare or cause to be prepared an option
agreement (“Director Option Agreement”) setting forth the terms of the Director
Option, and such Director Option Agreement shall be signed on behalf of the
Company and by the Participant.

 

(d)                                 Exercise of Director Options.  Except as otherwise provided in the
applicable Director Option Agreement, a Director Option may be exercised for
all, or from time to time any part, of the shares of Common Stock for which it
is then exercisable.  For purposes of
this Section 8, the exercise date of a Director Option shall be the date a
written notice of exercise and full payment of the purchase price are received
by the Company in accordance with this Section 8(d) and Section 8(e) below.  The purchase price for the shares of Common
Stock as to which a Director Option is exercised shall be paid to the Company
in cash or its equivalent, such as by check or wire transfer or, if provided in
the Director Option Agreement or with the consent of the Committee:  (i) in shares of Common Stock having a
Fair Market Value equal to the aggregate Exercise Price of the shares of Common
Stock being purchased and satisfying such other requirements as may be imposed
by the Committee; provided, that such shares were then purchased on the open
market or have been held by the Participant for at least six months (or such
other period as established from time to time by the Committee in order to
avoid adverse accounting treatment under generally accepted accounting
principles); (ii) partly in cash and partly in such shares; or (iii) if
there is a public market for the shares of Common Stock at such time, through
the delivery of irrevocable instructions to a broker to sell shares of Common
Stock obtained upon the exercise of the Director Option and to deliver promptly
to the Company an amount out of the proceeds of such sale equal to the
aggregate Exercise Price for the shares being purchased.

 

(e)                                  Manner of Exercise of Director Options.  A Director Option shall be exercised only by
the Participant (i) delivering a completed and signed written notice of
exercise to the Company in the form prescribed by the Company specifying the
number of shares of Common Stock as to which the Director Option is being
exercised; (ii) delivering the original Director Option Agreement to the
Company; and (iii) paying to the Company the full amount of the Exercise
Price for the 

 

12

 

number of shares of Common
Stock with respect to which the Director Option is being exercised as provided
in Section 8(d) above.  When
shares of Common Stock are issued to the Participant upon the exercise of that
Participant’s Director Option, the fact of such issuance shall be noted on the
Director Option Agreement by the Company before the Director Option Agreement
is returned to  the Participant.  When all shares of Common Stock covered by
the Director Option Agreement have been issued by the Company to the
Participant or when the Director Option expires, the Participant shall deliver
the Director Option Agreement to the Company, which shall cancel it.  After the receipt by the Company of the
written notice of exercise and payment in full of the Exercise Price in
accordance with Sections 8(d) and 8(e), the Company shall deliver or cause
to be delivered to the Participant exercising the Director Option stock
certificates evidencing the number of shares with respect to which the Director
Option has been exercised, issued in the Participant’s name; provided, however,
that such delivery shall be deemed effective for all purposes when the Company
or its stock transfer agent (if any) has deposited such stock certificates in
the United States mail, postage prepaid, addressed to the Participant at the
address specified in the written notice of exercise.

 

(f)                                    Termination of Status as a Director.  Subject to the provisions of Sections 8(g) and
8(h), if a Director ceases to serve as a Director, he or she may, but only
within ninety (90) days after the date he or she ceases to be a Director of the
Company, exercise his or her Director Option to the extent that he or she was
entitled to exercise it at the date of such termination.  Any portion of a Director Option that is not
exercisable on the date a Director ceases to be a Director of the Company, and
any portion of a Director Option which the Director was entitled to exercise
that is not exercised within the time specified herein, shall immediately and
automatically terminate and be forfeited, and neither such Director nor any of
the Director’s heirs, personal representatives, successors or assigns shall
have any rights with respect to such Director Option.

 

(g)                                 Disability of Director.  Notwithstanding the provisions of Section 8(f) above,
if a Director is unable to continue his or her service as a Director with the
Company as a result of his or her total and permanent disability (as defined in
Section 22(e)(3) of the Code), he or she may, but only within ninety
(90) days from the date of termination of such service, exercise his or her
Director Option to the extent he or she was entitled to exercise it at the date
of such termination.  Any portion of a
Director Option that is not exercisable on the date a Director ceases to be a
Director of the Company, and any portion of a Director Option which the
Director was entitled to exercise that is not exercised within the time
specified herein, shall immediately and automatically terminate and be
forfeited, and neither such Director nor any of the Director’s heirs, personal
representatives, successors or assigns shall have any rights with respect to
such Director Option.

 

(h)                                 Death of Director.  Upon the death of a Director holding a
Director Option:

 

(i)                                   during the term of the
Director Option when such Director was, at the time of his or her death, a
Director of the Company and who shall have been a Director since the date of
grant of the Director Option, the Director Option may be exercised, at any time
within one year following the date of death, 

 

13

 

by the person who acquired
the right to exercise such Director Option by bequest or inheritance, but only
to the extent of the right to exercise that existed at the date of death;

 

(ii)                                within ninety (90) days
after the termination of the Director’s status as a Director, the Director
Option may be exercised, at any time within ninety (90) days following the date
of death, by such Director’s estate or by a person who acquired the right to
exercise the Director Option by bequest or inheritance, but only to the extent
of the right to exercise that had accrued at the date of death; and

 

(iii)                             any portion of a Director
Option that is not exercisable on the date of a Director’s death, and any
portion of a Director Option which the Director was entitled to exercise that
is not exercised within the time specified in Section 8(h)(i) or Section 8(h)(ii),
shall immediately and automatically terminate and be forfeited, and neither
such Director nor any of the Director’s heirs, personal representatives,
successors or assigns shall have any rights with respect to such Director
Option.

 

9.                                      Terms and Conditions of Stock Appreciation Rights

 

(a)                                  Grants.  The Committee may grant a
Stock Appreciation Right independent of an Option or in connection with an
Option or a portion thereof.  Any grant
of a Stock Appreciation Right under the Plan shall be evidenced by an Award
agreement in such form as the Committee shall from time to time approve and
which shall set forth the terms and conditions of the Stock Appreciation
Right.  The Committee may impose such
terms and conditions upon any Stock Appreciation Right as it deems fit.  A Stock Appreciation Right granted in
connection with an Option or a portion thereof (i) may be granted at the time
the related Option is granted or at any time before the exercise or
cancellation of the related Option, (ii) shall cover the same number of
shares of Common Stock covered by the Option (or such fewer number of shares of
Common Stock as the Committee may determine), and (iii) shall be subject
to the same terms and conditions as such Option except for such additional
limitations as are contemplated by this Section 9 (or such additional
limitations as may be included in the Award agreement evidencing such Stock
Appreciation Right).

 

(b)                                 Terms. The exercise price per share
of Common Stock of a Stock Appreciation Right shall be an amount determined by
the Committee but in no event shall such amount be less than the Fair Market
Value of a share of Common Stock on the date the Stock Appreciation Right is
granted.  In addition, in the case of a
Stock Appreciation Right granted in conjunction with an Option or a portion
thereof, the exercise price shall not be less than the Exercise Price of the
related Option.  Each Stock Appreciation
Right granted independent of an Option shall entitle a Participant upon
exercise to an amount equal to (i) the excess of (A) the Fair Market
Value on the exercise date of one share of Common Stock over (B) the
exercise price per share, times (ii) the number of shares of Common Stock
covered by the Stock Appreciation Right. 
Each Stock Appreciation Right granted in conjunction with an Option or a
portion thereof shall entitle a Participant to surrender to the Company the
unexercised Option or any portion thereof and to 

 

14

 

receive from the Company in exchange therefor
an amount equal to (I) the excess of (x) the Fair Market Value on the
exercise date of one share of Common Stock over (y) the Exercise Price per
share of Common Stock, times (II) the number of shares of Common Stock
covered by the Option, or portion thereof, which is surrendered.  Payment shall be made in shares of Common
Stock or in cash, or partly in shares and partly in cash (any such shares of
Common Stock valued at such Fair Market Value), all as set forth in the Award
agreement evidencing such Stock Appreciation Right or as otherwise determined
in the discretion of the Committee. 
Stock Appreciation Rights may be exercised from time to time upon actual
receipt by the Company of written notice of exercise stating the number of
shares of Common Stock with respect to which the Stock Appreciation Right is
being exercised.  The date a notice of
exercise is received by the Company shall be the exercise date.

 

(c)                                  Termination of Employment or Service.  If a Participant who holds a Stock
Appreciation Right shall cease to be employed by or performing services for the
Company or any Affiliate for any reason other than death, unless the applicable
Award agreement provides otherwise, such Stock Appreciation Right shall
immediately and automatically terminate and be forfeited, whether or not
exercisable, and neither such Participant nor any of the Participant’s heirs,
personal representatives, successors or assigns shall have any rights with
respect to such Stock Appreciation Right. 
Notwithstanding the foregoing, if an independent contractor or other
non-employment relationship between the Participant and the Company or an
Affiliate is terminated due to the commencement of an employment relationship
with the Company or an Affiliate, this provision shall apply only upon
termination of both the independent contractor and employment relationship
between the Participant and the Company or an Affiliate.  In the case of a Participant who is a natural
person and who ceases to be employed by or performing services for the Company
or an Affiliate due to his or her disability (with disability being determined
in the sole discretion of the Committee), the Committee, at its discretion, may
permit exercise of the portion of the Stock Appreciation Right that is
exercisable upon such termination of employment until the earlier of the
originally stated date of termination of the Stock Appreciation Right or up to
one year after such termination of employment or other service.

 

(d)                                 Death of Participant.  Unless otherwise provided in the applicable
Award agreement, if a Participant who is a natural person shall cease to be
employed by or performing services for the Company or any Affiliate as a result
of the Participant’s death, any Stock Appreciation Right held by such
Participant may be exercised to the same extent that the Participant would have
been entitled to exercise it at the date of death and may be exercised within a
period of one (1) year after the date of death, but in no case later
than the expiration date of such Stock Appreciation Right.  Such Stock Appreciation Right shall be
exercised pursuant to Section 9(b) of this Plan by the person or persons
to whom the Participant’s rights under the Stock Appreciation Right shall pass
by will or the laws of descent and distribution.

 

15

 

(e)                                  Termination of Stock Appreciation Rights Not Exercisable.  Unless the applicable Award agreement
provides otherwise, upon termination of a Participant’s employment or other
services with the Company or an Affiliate for any reason, including by reason
of death or disability of the Participant, any portion of the Participant’s
Stock Appreciation Rights that is not exercisable shall automatically and
immediately terminate as to such Participant.

 

10.                               Awards of Restricted Stock

 

(a)                                  Grant. 
Awards of Restricted Stock subject to forfeiture and transfer
restrictions may be granted by the Committee under the Plan.  Any Awards of Restricted Stock shall be
evidenced by an Award agreement in such form as the Committee shall from time
to time approve and which shall set forth the terms and conditions of the Award
of Restricted Stock.  Subject to the
provisions of the Plan, the Committee shall determine the number of shares of
Restricted Stock to be granted to each Participant; the duration of any period
during which, and the conditions, if any, under which, the Restricted Stock may
be forfeited to the Company; and the other terms and conditions of such
Awards.  The Committee may determine a
period of time during which the Participant receiving the Award of Restricted
Stock must remain in the continuous employment of the Company in order for the
forfeiture and transfer restrictions to lapse. 
If the Committee so determines, the restrictions may lapse during any
such restricted period in installments with respect to specified portions of
the shares of Restricted Stock covered by the Award of Restricted Stock.  The Committee may also impose performance or
other conditions that will subject the shares subject to the Award of
Restricted Stock to forfeiture and transfer restrictions.  Notwithstanding anything in this Plan to the
contrary, with respect to Awards of Restricted Stock that are Tenure-Based
Full-Value Awards, the restrictions imposed on such Awards of Restricted Stock
shall not lapse, and the Awards of Restricted Stock shall not vest, with
respect to 100% of the Awards of Restricted Stock in less than three (3) years;
provided, however, that during such three (3)-year period, the restrictions may
lapse and the Awards may vest with respect to less than 100% of the value of
the Award.  The Committee may, at any
time, in its discretion, waive all or any part of any restrictions applicable
to any or all outstanding Awards of Restricted Stock; provided, however, that
the Committee shall not and shall not have the power to waive the restrictions
set forth in the immediately foregoing sentence except in the case of the death
or disability of the Participant holding the Award of Restricted Stock (with
disability being determined in the sole discretion of the Committee) or upon a
Change in Control.

 

(b)                                 Transfer
Restrictions. Shares of Restricted Stock may not be sold, assigned, transferred,
pledged or otherwise encumbered, except as provided in the Plan or the
applicable Award agreement.  At the time
of the grant of an Award of Restricted Stock, a stock certificate representing
the number of shares of Restricted Stock awarded thereunder shall be registered
in the name of the Participant and held by the Company.  Such stock certificate may bear a legend
describing the conditions of the Restricted Stock Award.  Unless the Award agreement evidencing an
Award of Restricted Stock or the Committee provides otherwise, the Participant
receiving the Award of Restricted Stock shall have all 

 

16

 

rights of a shareholder with respect to the shares of Restricted Stock
subject to such Award, including the right to receive any dividends and the
right to vote such shares, subject to the following restrictions:  (i) the Participant receiving the Award
of Restricted Stock shall not be entitled to delivery of the stock certificate
until the expiration of the restricted period and the fulfillment of any other
restrictive conditions set forth in the applicable Award agreement; (ii) none
of the shares of Common Stock subject to the Award of Restricted Stock may be
sold, assigned, transferred, pledged, hypothecated or otherwise encumbered or
disposed of during such restricted period or until after the fulfillment of any
such other restrictive condition; and (iii) all of the shares of
Restricted Stock shall be forfeited and all rights of the Participant to such
shares shall terminate, without any further obligation on the part of the
Company, unless the Participant remains in the continuous employment of the
Company for the entire restricted period. 
Any shares of Common Stock, any other securities of the Company and any
other property (except for cash dividends) distributed with respect to the
shares subject to an Award of Restricted Stock shall be subject to the same
restrictions, terms and conditions as such shares.  After the lapse or termination of the
restrictions of an Award of Restricted Stock, or at such earlier time as
otherwise determined by the Committee, a stock certificate evidencing the
shares of Common Stock subject to the Award of Restricted Stock that bears no
legend describing the conditions of an Award of Restricted Stock shall be
delivered to the Participant or his or her beneficiary or estate, as the case
may be.

 

(c)                                  Dividends. Dividends or dividend equivalents paid on
any shares of Restricted Stock may be paid directly to the Participant,
withheld by the Company subject to vesting of the Restricted Stock pursuant to
the terms of the applicable Award agreement, or may be reinvested in additional
Awards of Restricted Stock, as determined by the Committee in its discretion.

 

(d)                                 Termination of Employment or Service.  If a Participant who holds a Restricted Stock
Award shall cease to be employed by or performing services for the Company or
any Affiliate for any reason other than death prior to the vesting of shares of
Restricted Stock granted to such Participant, unless the applicable Award
agreement provides otherwise, such Restricted Stock Award shall immediately and
automatically terminate and be forfeited and neither such Participant nor any
of the Participant’s heirs, personal representatives, successors or assigns
shall have any rights with respect to such unvested Restricted Stock
Award.  Notwithstanding the foregoing, if
an independent contractor or other non-employment relationship between the
Participant and the Company or an Affiliate is terminated due to the
commencement of an employment relationship with the Company or an Affiliate,
this provision shall apply only upon termination of both the independent
contractor and employment relationship between the Participant and the Company
or an Affiliate.  In the case of a
Participant who is a natural person and who ceases to be employed by or
performing services for the Company or an Affiliate due to his or her disability
(with disability being determined in the sole discretion of the Committee), the
Committee, at its discretion, may permit a portion or all of the shares subject
to the Restricted Stock Award held by such Participant to vest on the date of
such termination.

 

17

 

(e)                                  Death of Participant.  Unless otherwise provided in the applicable
Award agreement, if a Participant who is a natural person shall cease to be
employed by or performing services for the Company or any Affiliate as a result
of the Participant’s death prior to the vesting of shares subject to the
Restricted Stock Award granted to such Participant, the Committee, at its
discretion, may permit a portion or all of the shares of Restricted Stock to
vest as of the date of death or to continue the Restricted Stock Award under
such terms and conditions as the Committee may determine.  The person entitled to any such shares of
Restricted Stock shall be the person or persons to whom the Participant’s
rights under the Restricted Stock Award shall pass by will or the laws of
descent and distribution.

 

(f)                                    Termination of Restricted Stock Awards Not Vested.  Unless the applicable Award agreement
provides otherwise, upon termination of a Participant’s employment or other
services with the Company or an Affiliate for any reason, including by reason
of death or disability of the Participant, any portion of the Participant’s
Restricted Stock Award that has not vested shall automatically and immediately
terminate as to such Participant, and the shares subject to such portion of the
Restricted Stock Award shall be available for the grant of Awards under the
Plan.

 

(g)                                 Other Provisions. 
Each Award agreement relating to an Award of Restricted Stock authorized
under this Section 10 may contain such other provisions as the Committee
shall deem advisable including, but not limited to, a requirement that shares
of Common Stock acquired under an Award of Restricted Stock be subject to a
restriction on the Participant’s ability to transfer the shares to third
parties without the consent of the Company.

 

11.                               Other Awards

 

(a)                                  Other Stock-Based Awards.  The Committee, in its sole discretion, may
grant Awards of shares of Common Stock and Awards that are valued in whole or
in part by reference to, or are otherwise based on, shares of Common Stock or
on the Fair Market Value thereof (“Other Stock-Based Awards”). Such Other
Stock-Based Awards shall be in such form, and dependent on such conditions, as
the Committee shall determine including, without limitation, the right to
receive, or vest with respect to, one or more shares of Common Stock (or the
equivalent cash value of such shares) upon the completion of a specified period
of service, the occurrence of an event and/or the attainment of performance
objectives. Other Stock-Based Awards may be granted alone or in addition to any
other Awards granted under the Plan. Subject to the provisions of the Plan, the
Committee shall determine the number of shares of Common Stock to be awarded to
a Participant under (or otherwise related to) such Other Stock-Based Awards;
whether such Other Stock-Based Awards shall be settled in cash, shares of
Common Stock or a combination of cash and such shares; and all other terms and
conditions of such Awards (including, without limitation, the vesting
provisions thereof and provisions ensuring that all shares so awarded and
issued shall be fully paid and non-assessable). 
Any Other Stock-Based Awards shall be evidenced by an Award agreement in
such form as the Committee shall from time to time approve and which shall set
forth the terms and conditions of the Other Stock-Based Award.  Unless the applicable Award agreement
provides otherwise, if a Participant who 

 

18

 

holds an Other Stock-Based Award shall cease
to be employed by or performing services for the Company or an Affiliate for
any reason, such Other Stock-Based Award shall be treated by the Committee as
though it is either a Non-Qualified Option or a Restricted Stock Award, as the
Committee shall determine in its discretion.

 

(b)                                 Other Cash-Based Awards.  In addition to the Awards described above,
and subject to the terms of the Plan, the Committee may grant such other
incentives denominated in cash and payable in cash under the Plan as the
Committee determines to be in the best interests of the Company and subject to
such other terms and conditions as it deems appropriate (“Other Cash-Based
Awards”).  Any Other Cash-Based Awards
shall be evidenced by an Award agreement in such form as the Committee shall from
time to time approve and which shall set forth the terms and conditions of the
Other Cash-Based Award.  Unless the
applicable Award agreement provides otherwise, if a Participant who holds an
Other Cash-Based Award shall cease to be employed by or performing services for
the Company or an Affiliate for any reason, such Other Cash-Based Award shall
be treated as though it is a Stock Appreciate Right or otherwise as the
Committee shall determine in its discretion.

 

(c)                                  Tenure-Based Full-Value
Awards.  Notwithstanding
anything in this Plan to the contrary, with respect to Tenure-Based Full-Value
Awards, the restrictions imposed on such Awards shall not lapse, and the Awards
shall not vest, with respect to 100% of the Awards in less than three (3) years;
provided, however, that during such three (3)-year period, the restrictions may
lapse and the Awards may vest with respect to less than 100% of the value of
the Award.  The Committee shall not and
shall not have the power to waive the restrictions set forth in the immediately
foregoing sentence except in the case of the death or disability of the
Participant holding the Tenure-Based Full-Value Award (with disability being
determined in the sole discretion of the Committee) or upon a Change in
Control.

 

12.                               Performance-Based Awards.

 

(a)                                  Performance-Based Awards.  Notwithstanding anything to the contrary
herein, the Committee may grant performance-based Options, Awards of Restricted
Stock, Other Stock-Based Awards and Other Cash-Based Awards to Participants (“Performance-Based
Awards”). Any such Awards granted to Participants who may be “covered employees”
under Section 162(m) of the Code or any successor section thereto
shall be consistent with the provisions thereof.  In such cases, a Participant’s Performance-Based
Award shall be determined based on the attainment of written performance goals
approved by the Committee for a performance period established by the Committee
(i) when the outcome for that performance period is substantially
uncertain and (ii) by the earlier of (A) ninety (90) days after the
commencement of the performance period to which the performance goal relates or
(B) the number of days which is equal to twenty-five percent (25%) of the
relevant performance period.

 

(b)                                 Performance Goals.  The performance goals referred to in Section 12(a) must
be objective and shall be based upon one or more of the following
criteria:  

 

19

 

(i) consolidated earnings before or
after taxes (including earnings before interest, taxes, depreciation and
amortization); (ii) net income; (iii) operating income; (iv) earnings
per share; (v) book value per share of Common Stock; (vi) return on
shareholders’ equity; (vii) expense management; (viii) return on
investment; (ix) improvements in capital structure; (x) profitability
of an identifiable business unit or product; (xi) maintenance or
improvements of profit margins; (xii) stock price; (xiii) market share; (xiv)
revenues or sales; (xv) costs; (xvi) cash flow; (xvii) working capital; (xviii)
return on assets; (xix) asset turnover; (xx) inventory turnover;
(xxi) economic value added (economic profit); and (xxii) total shareholder
return.  The foregoing criteria may
relate to the Company, one or more of its Parents or Subsidiaries or one or
more of its divisions or units, or any combination of the foregoing, and may be
applied on an absolute basis and/or be relative to one or more peer group
companies or indices, or any combination thereof, all as the Committee shall
determine. In addition, to the degree consistent with Section 162(m) of
the Code (or any successor section thereto), the performance goals may be
calculated without regard to the negative effect of unusual or nonrecurring
items, extraordinary items, discontinued operations or cumulative effects of
accounting changes. The Committee shall determine whether, with respect to a
performance period, the applicable performance goals have been met with respect
to a given Participant who may be a covered employee and, if they have, shall
so certify and ascertain the amount of the applicable Performance-Based Award.
No Performance-Based Awards will be paid for such performance period until such
certification is made by the Committee. The amount of the Performance-Based
Award actually paid to a given Participant may be less than the amount
determined by the applicable performance goal formula, at the discretion of the
Committee. The amount of the Performance-Based Award determined by the
Committee for a performance period shall be paid to the Participant at such
time as determined by the Committee in its sole discretion after the end of
such performance period.

 

(c)                                  Vesting of
Performance-Based Full-Value Awards.  The restrictions imposed on the vesting of
Performance-Based Full-Value Awards shall not lapse, and such Awards shall not
vest, in less than one (1) year.

 

13.                               Adjustments Upon Certain Events

 

Notwithstanding
any other provisions in the Plan to the contrary, the following provisions
shall apply to all Awards granted under the Plan:

 

(a)                                  Generally.  Upon any change in the outstanding shares of
Common Stock after the Effective Date by reason of any stock dividend, stock
split, reverse stock split, reclassification, combination, exchange of shares
or other similar recapitalization of the Company, there shall be an appropriate
adjustment to (i) the number or kind of shares of Common Stock or other
securities issued or reserved for issuance pursuant to the Plan or pursuant to
outstanding Awards, (ii) the Exercise Price of any Option or the exercise
price of any Stock Appreciation Right, and/or (iii) any other affected
terms of such Awards.  Notwithstanding
the foregoing, no fractional shares shall be issued or paid for.  No adjustment shall be made under this Section 13(a) upon
the issuance by the Company of any warrants, rights or options to acquire
additional Common Stock or of securities convertible into 

 

20

 

Common Stock unless such warrants, rights,
options or convertible securities are issued to all shareholders of the Company
on a proportionate basis.

 

(b)                                 Change in Control.  Notwithstanding anything
contained in this Plan to the contrary, and unless otherwise provided in the
applicable Award agreement at the time of grant, in the event of a “Change in
Control” (as defined below), the following shall occur as of the effective date
of such Change in Control with respect to any and all Awards outstanding as of
the effective date of such Change in Control: 
(i) any and all Awards granted hereunder will be, as nearly as may
reasonably be, automatically converted into the same type of Award to acquire
the kind and amount of shares of stock or other securities or property
(including cash) which the Participant would have owned or have been entitled
to receive as of the effective date of the Change in Control had the Awards
been exercised or realized in full immediately before the effective date of the
Change in Control; (ii) any vesting schedule of all Awards shall remain
unchanged; (iii) appropriate adjustment shall be made in the application
of the provisions of all outstanding Awards with respect to the rights and
interests thereafter of each Participant, to the end that the provisions set
forth in each Award shall thereafter correspondingly be made applicable, as
nearly as may reasonably be, in relation to any shares of stock or other
securities or property (including cash) thereafter deliverable under the Award;
and (iv) any restrictions imposed on Awards, including Awards of Restricted
Stock and Performance-Based Awards of Restricted Stock, shall remain unchanged.

 

(c)                                  Definition of Change of Control.  For purposes of this Section 13, “Change
in Control” means:

 

(i)                                  The sale, lease, exchange or
other transfer, directly or indirectly, of all or substantially all of the
assets of the Company (in one transaction or in a series of related
transactions) to a person or entity that is not controlled by the Company;

 

(ii)                               The approval by the Company’s
shareholders of any plan or proposal for the liquidation or dissolution of the
Company;

 

(iii)                            Any person or entity becomes
the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of more than fifty percent (50%) of the combined voting
power of the outstanding securities of the Company ordinarily having the right
to vote at elections of directors who were not beneficial owners of at least
fifty percent (50%) of such combined voting power as of the Effective Date; or

 

(iv)                           A merger or consolidation to
which the Company is a party if the shareholders of the Company immediately
prior to the effective date of such merger or consolidation have, solely on
account of ownership of securities of the Company at such time, “beneficial
ownership” (as defined in Rule 13d-3 under the Exchange Act) immediately
following the effective date of such merger or consolidation of securities of
the surviving company representing less than fifty percent (50%) of the 

 

21

 

combined voting power of the surviving
corporation’s then outstanding securities ordinarily having the right to vote
at elections of directors.

 

The provisions of this Section shall
similarly apply to successive transactions of the types described in Sections
13(c)(i) through (iv).

 

(d)                                 Additional Adjustments of Awards.  Subject to the above provisions, the
Committee shall have the discretion, exercisable at any time before a sale,
merger, consolidation, reorganization, liquidation, dissolution or other Change
in Control transaction, to take such further action as it determines to be
necessary or advisable with respect to Awards. 
Such authorized action may include (but shall not be limited to)
establishing, amending or waiving the type, terms, conditions or duration of,
or restrictions on, Awards so as to provide for earlier, later, extended or
additional time for exercise and lifting restrictions and other modifications,
and the Committee may take such actions with respect to all Participants, to
certain categories of Participants or to only individual Participants.  The Committee may take such action before or
after granting Awards to which the action relates and before or after any
public announcement with respect to such sale, merger, consolidation,
reorganization, liquidation, dissolution or Change in Control that is the
reason for such action.  The grant of an
Award under the Plan shall not affect in any way the right or power of the
Company to make adjustments, reclassifications, reorganizations or changes of
its capital or business structure or to merge or to consolidate or to dissolve,
liquidate or sell, or transfer all or any part of its business or assets.

 

14.                               Shares Acquired for Investment

 

Shares of Common Stock
acquired by a Participant under this Plan shall be acquired by the Participant
for investment and without intention of resale unless, in the opinion of
counsel to the Company, such shares may be purchased without any investment
representation.  Where an investment
representation is deemed necessary, the Committee may require a written
representation to that effect by the Participant as a condition of a
Participant exercising an Option or otherwise obtaining shares of Common Stock
pursuant an Award granted under this Plan, and the Committee may place an appropriate
legend on the stock certificates evidencing the shares of Common Stock so
issued indicating that such shares have not been registered under federal or
state securities laws and describing the restrictions on transfer.  Each Award shall be subject to the
requirement that if, at any time, the Committee shall determine in its
discretion that the listing, registration or qualification of the shares of
Common Stock subject to the Award upon any securities exchange or under any
state or federal law, or the consent or approval of any governmental regulatory
body, if necessary or desirable as a condition of, or in connection with, the
granting of such Award or the issuance or purchase of shares of Common Stock
thereunder, then such Award shall not be granted or exercised in whole or in
part unless such listing, registration, qualification, consent or approval
shall have been effected or obtained free of any conditions not acceptable to
the Committee.

 

15.                               No Right to Employment, Service as a Director or Awards

 

The
granting of an Award under the Plan shall impose no obligation on the Company
or any Affiliate to continue the employment of a Participant and shall not
lessen or affect the Company’s or the Affiliate’s right to terminate the
employment of such Participant.  Nothing
in 

 

22

 

the
Plan will interfere with or limit in nay way the right of the Company, the
Board or the Company’s stockholders to terminate the directorship of any
Director at any time, nor confer upon any Director any right to continue to
serve as a Director of the Company.  No
Participant or other person shall have any claim to be granted any Award, and
there is no obligation for uniform treatment of Participants or holders or
beneficiaries of Awards.  The terms and
conditions of Awards and the Committee’s determinations and interpretations
with respect thereto need not be the same with respect to each Participant.

 

16.                               Other Benefit and
Compensation Programs

 

Payments
and other benefits received by a Participant under an Award shall not be deemed
a part of a Participant’s regular, recurring compensation for purposes of any
termination, indemnity or severance pay laws and shall not be included in, nor
have any effect on, the determination of benefits under any other employee
benefit plan, contract or similar arrangement provided by the Company or an
Affiliate, unless expressly so provided by such other plan, contract or
arrangement or the Committee determines that an Award or portion of an Award
should be included to reflect competitive compensation practices or to
recognize that an Award has been made in lieu of a portion of competitive cash
compensation.

 

17.                               Successors and Assigns

 

The
Plan shall be binding on all successors and assigns of the Company and a
Participant including, without limitation, the estate of such Participant and
the executor, administrator or trustee of such estate, or any receiver or
trustee in bankruptcy or representative of the Participant’s creditors.

 

18.                               Nontransferability of Awards; Designation of Beneficiary

 

(a)                                  Nontransferability. 
No Award or interest in an Award may be sold, assigned, pledged (as
collateral for a loan or as security for the performance of an obligation or
for any other purpose) or transferred by the Participant or made subject to
attachment or similar proceedings otherwise than by will or by the applicable
laws of descent and distribution, except to the extent a Participant designates
one or more beneficiaries on a Company-approved form who may exercise the Award
or receive payment under the Award after the Participant’s death.  During a Participant’s lifetime, an Award may
be exercised only by the Participant.

 

(b)                                 Designation of
Beneficiary.  A Participant may designate a beneficiary to
succeed to the Participant’s Awards under the Plan in the event of the
Participant’s death by filing a beneficiary form with the Company and, upon the
death of the Participant, such beneficiary shall succeed to the rights of the
Participant to the extent permitted by law and the terms of this Plan and the
applicable Award agreement.  In the
absence of a validly designated beneficiary who is living at the time of the
Participant’s death, the Participant’s executor or administrator of the
Participant’s estate shall succeed to the Awards, which shall be transferable
by will or pursuant to laws of descent and distribution.

 

23

 

19.                               Amendments or Termination

 

                The Board may
amend, alter or discontinue the Plan, but no amendment, alteration or
discontinuation shall be made without the consent of a Participant if such
action would diminish any of the rights of the Participant under any Award
theretofore granted to such Participant under the Plan; provided, however, that the Committee may
amend the Plan in such manner as it deems necessary to permit the granting of
Awards meeting the requirements of the Code or other applicable laws.

 

20.                               International Participants

 

                With respect to Participants who
reside or work outside the United States of America, the Committee may, in its
sole discretion, amend the terms of the Plan or adopt such modifications,
procedures or subplans with respect to such Participants as are necessary or
desirable to ensure the viability of the benefits of the Plan, comply with
applicable foreign laws or obtain more favorable tax or other treatment for a
Participant, the Company or an Affiliate; provided, however, that no such
changes shall apply to the Awards to Participants who may be “covered employees”
under Section 162(m) of the Code or any successor thereto unless
consistent with the provisions thereof.

 

21.                               General

 

(a)                                  Issuance of Shares of Common Stock.  Notwithstanding any other provision of the
Plan, the Company shall have no obligation to issue or deliver any shares of
Common Stock under an Award granted under the Plan or make any other
distribution of benefits under the Plan unless, in the opinion of the Company’s
counsel, such issuance, delivery or distribution would comply with all
applicable laws (including, without limitation, the requirements of the
Securities Act of 1933, as amended, or any successor thereto (the “Securities
Act”) or the laws of any state or foreign jurisdiction) and the applicable
requirements of any securities exchange or similar entity.  The Company shall be under no obligation to
any Participant to register for offering or resale or to qualify for an
exemption from registration under the Securities Act, or to register or qualify
under the laws of any state or foreign jurisdiction, any Awards, shares of
Common Stock, security or interest in a security paid or issued under, or
created by, the Plan, or to continue in effect any such registrations or
qualifications if made.  The Company may
issue stock certificates evidencing shares of Common Stock with such legends
and subject to such restrictions on transfer and stop transfer instructions as
counsel for the Company deems necessary or desirable for compliance by the
Company with federal, state and foreign securities laws.  The Company may also require such other
action or agreement by the Participants as may from time to time be necessary
to comply with applicable securities laws.

 

(b)                                 Stock Certificates.  To the extent this Plan or any applicable
Award agreement provides for the issuance of stock certificates to reflect the
issuance of shares of Common Stock, the issuance may be effected on a
non-certificated basis, to the extent not prohibited by applicable law or the
applicable rules of any stock exchange or market on which such shares are
traded or quoted.

 

24

 

(c)                                  No Rights as a Shareholder.  Unless otherwise provided by the Committee or
in the Plan or an Award agreement evidencing an Award or in any other written
agreement between a Participant and the Company or an Affiliate, no Award shall
entitle the Participant to any cash dividend, voting or other right of a
shareholder unless and until the date of issuance under the Plan of any shares
of Common Stock that are subject to such Award.

 

(d)                                 No Trust or Fund.  The Plan is intended to constitute an “unfunded”
plan.  Nothing contained herein shall
require the Company to segregate any monies, other property, or shares of
Common Stock, or to create any trusts, or to make any special deposits for any
immediate or deferred amounts payable to any Participant, and no Participant
shall have any rights that are greater than those of a general unsecured
creditor of the Company.

 

(e)                                  Severability.  If
any provision of the Plan or any Award agreement shall be held illegal or
invalid for any reason, the illegality or invalidity shall not affect the
remaining parts of the Plan or Award agreement, and such Plan or Award
agreement shall be construed and enforced as if the illegal or invalid provision
had not been included.

 

(f)                                    Choice of Law.  The
validity, construction, interpretation, administration and effect of the Plan,
and rights relating to the Plan and to Awards granted under the Plan, shall be
governed by the substantive laws, but not the choice of law rules, of the State
of Minnesota.

 

22.                               Effective Date

 

The
Plan shall be effective on October 8, 2004 (the “Effective Date”), which
is the date it was approved by the Board. 
Amendments to the Plan were approved by the Board on May 10, 2005, March 23,
2006, February 5, 2007 and March 31, 2008 and the Plan, as so
amended, was approved by the Company’s shareholders on June 10, 2005, May 18,
2006, May 17, 2007 and May 22, 2008. 
The Plan takes into account the reverse stock splits effected in June 2005
and May 2008.

 

25Exhibit 10.1

 

EXECUTION COPY

 

 

AMENDED AND RESTATED

CREDIT AGREEMENT

 

dated as of

 

May 21, 2008,

 

among

 

INDALEX HOLDINGS FINANCE, INC.,

 

INDALEX HOLDING CORP.,

as Parent Borrower,

 

INDALEX LIMITED,

as Canadian Subsidiary Borrower,

 

The Subsidiary Loan Parties Party Hereto,

 

The Lenders Party Hereto

 

and

 

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

 

 

J.P. MORGAN SECURITIES INC.,

as Sole Bookrunner and Sole Lead Arranger

 

 

 

TABLE OF CONTENTS

 

	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE I

  	
   

  
	
   

  	
   

  
	
  Definitions

  	
   

  
	
   

  	
   

  
	
  SECTION 1.01. Defined Terms

  	
  1

  
	
  SECTION 1.02. Classification of Loans
  and Borrowings

  	
  47

  
	
  SECTION 1.03. Terms Generally

  	
  47

  
	
  SECTION 1.04. Accounting Terms; GAAP

  	
  47

  
	
  SECTION 1.05. Currency Translation

  	
  48

  
	
   

  	
   

  
	
  ARTICLE II

  	
   

  
	
   

  	
   

  
	
  The Credits

  	
   

  
	
   

  	
   

  
	
  SECTION 2.01. Commitments

  	
  49

  
	
  SECTION 2.02. Loans and Borrowings

  	
  49

  
	
  SECTION 2.03. Requests for Borrowings

  	
  51

  
	
  SECTION 2.04. Swingline Loans

  	
  52

  
	
  SECTION 2.05. Letters of Credit

  	
  53

  
	
  SECTION 2.06. Canadian Bankers’
  Acceptances

  	
  57

  
	
  SECTION 2.07. Funding of Borrowings

  	
  60

  
	
  SECTION 2.08. Interest Elections

  	
  61

  
	
  SECTION 2.09. Termination and
  Reduction of Commitments

  	
  63

  
	
  SECTION 2.10. Repayment of Loans and
  B/As; Evidence of Debt

  	
  63

  
	
  SECTION 2.11. Prepayments

  	
  64

  
	
  SECTION 2.12. Fees

  	
  66

  
	
  SECTION 2.13. Interest

  	
  67

  
	
  SECTION 2.14. Alternate Rate of Interest

  	
  68

  
	
  SECTION 2.15. Increased Costs

  	
  69

  
	
  SECTION 2.16. Break Funding Payments

  	
  70

  
	
  SECTION 2.17. Taxes

  	
  70

  
	
  SECTION 2.18. Payments Generally; Pro
  Rata Treatment; Sharing of Set-offs

  	
  72

  
	
  SECTION 2.19. Mitigation Obligations;
  Replacement of Lenders

  	
  74

  
	
  SECTION 2.20. Returned Payments

  	
  75

  
	
  SECTION 2.21. Revolving Commitment
  Increases; Incremental Term Loans

  	
  75

  
	
  SECTION 2.22. Delivery of a Borrowing
  Base Certificate

  	
  77

  
	
   

  	
   

  
	
  ARTICLE III

  	
   

  
	
   

  	
   

  
	
  Representations and Warranties

  	
   

  
	
   

  	
   

  
	
  SECTION 3.01. Organization; Powers

  	
  77

  
	
  SECTION 3.02. Authorization;
  Enforceability

  	
  77

  
	
  SECTION 3.03. Governmental Approvals;
  No Conflicts

  	
  77

  
	
  SECTION 3.04. Financial Condition; No
  Material Adverse Change

  	
  78

  

 

 

	
  SECTION 3.05. Properties

  	
  78

  
	
  SECTION 3.06. Litigation and
  Environmental Matters

  	
  78

  
	
  SECTION 3.07. Compliance with Laws and
  Agreements

  	
  79

  
	
  SECTION 3.08. Investment Company
  Status

  	
  79

  
	
  SECTION 3.09. Taxes

  	
  79

  
	
  SECTION 3.10. ERISA

  	
  79

  
	
  SECTION 3.11. Disclosure

  	
  80

  
	
  SECTION 3.12. Solvency

  	
  80

  
	
  SECTION 3.13. Insurance

  	
  81

  
	
  SECTION 3.14. Capitalization and
  Subsidiaries

  	
  81

  
	
  SECTION 3.15. Labor Disputes

  	
  81

  
	
  SECTION 3.16. Indalex UK Limited

  	
  82

  
	
   

  	
   

  
	
  ARTICLE IV

  	
   

  
	
   

  	
   

  
	
  Conditions

  	
   

  
	
   

  	
   

  
	
  SECTION 4.01. Restatement Effective
  Date

  	
  82

  
	
  SECTION 4.02. Each Credit Event

  	
  85

  
	
   

  	
   

  
	
  ARTICLE V

  	
   

  
	
   

  	
   

  
	
  Affirmative Covenants

  	
   

  
	
   

  	
   

  
	
  SECTION 5.01. Financial Statements;
  Borrowing Base and Other Information

  	
  85

  
	
  SECTION 5.02. Notices of Material
  Events

  	
  87

  
	
  SECTION 5.03. Existence

  	
  88

  
	
  SECTION 5.04. Payment of Obligations

  	
  88

  
	
  SECTION 5.05. Maintenance of
  Properties

  	
  89

  
	
  SECTION 5.06. Books and Records;
  Inspection Rights

  	
  89

  
	
  SECTION 5.07. Compliance with Laws

  	
  90

  
	
  SECTION 5.08. Use of Proceeds

  	
  90

  
	
  SECTION 5.09. Insurance

  	
  90

  
	
  SECTION 5.10. Depository Banks

  	
  90

  
	
  SECTION 5.11. Additional Collateral;
  Further Assurances

  	
  91

  
	
  SECTION 5.12. Purchase Price
  Adjustment

  	
  92

  
	
  SECTION 5.13. Post-Closing Obligations

  	
  92

  
	
   

  	
   

  
	
  ARTICLE VI

  	
   

  
	
   

  	
   

  
	
  Negative Covenants

  	
   

  
	
   

  	
   

  
	
  SECTION 6.01. Indebtedness

  	
  92

  
	
  SECTION 6.02.
  Liens

  	
  96

  
	
  SECTION 6.03.
  Fundamental Changes

  	
  97

  
	
  SECTION 6.04. Investments, Loans,
  Advances, Guarantees and Acquisitions

  	
  98

  
	
  SECTION 6.05. Asset Sales

  	
  101

  
	
  SECTION 6.06. Sale and Leaseback
  Transactions

  	
  102

  
	
  SECTION 6.07. Swap Agreements

  	
  102

  
	
  SECTION 6.08. Restricted Payments;
  Certain Payments of Indebtedness

  	
  103

  
	
  SECTION 6.09. Transactions with
  Affiliates

  	
  105

  

 

ii

 

	
  SECTION 6.10. Restrictive Agreements

  	
  105

  
	
  SECTION 6.11. Amendment of Material
  Documents

  	
  106

  
	
  SECTION 6.12. Fixed Charge Coverage
  Ratio

  	
  106

  
	
  SECTION 6.13. Certain Equity
  Securities

  	
  106

  
	
  SECTION 6.14. Changes in Fiscal
  Periods

  	
  106

  
	
   

  	
   

  
	
  ARTICLE VII

  	
   

  
	
   

  	
   

  
	
  Events of Default

  	
   

  
	
   

  	
   

  
	
  ARTICLE VIII

  	
   

  
	
   

  	
   

  
	
  The Administrative Agent

  	
   

  
	
   

  	
   

  
	
  ARTICLE IX

  	
   

  
	
   

  	
   

  
	
  Miscellaneous

  	
   

  
	
   

  	
   

  
	
  SECTION 9.01. Notices

  	
  112

  
	
  SECTION 9.02. Waivers; Amendments

  	
  113

  
	
  SECTION 9.03. Expenses; Indemnity;
  Damage Waiver

  	
  116

  
	
  SECTION 9.04. Successors and Assigns

  	
  118

  
	
  SECTION 9.05. Survival

  	
  122

  
	
  SECTION 9.06. Counterparts;
  Integration; Effectiveness

  	
  122

  
	
  SECTION 9.07. Severability

  	
  123

  
	
  SECTION 9.08. Right of Setoff

  	
  123

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

  	
  123

  
	
  SECTION 9.10. WAIVER OF JURY TRIAL

  	
  124

  
	
  SECTION 9.11. Headings

  	
  124

  
	
  SECTION 9.12. Confidentiality

  	
  124

  
	
  SECTION 9.13. Several Obligations;
  Nonreliance; Violation of Law

  	
  125

  
	
  SECTION 9.14. USA PATRIOT Act

  	
  125

  
	
  SECTION 9.15. Disclosure

  	
  125

  
	
  SECTION 9.16. Appointment for
  Perfection

  	
  125

  
	
  SECTION 9.17. Interest Rate Limitation

  	
  126

  
	
  SECTION 9.18. Quebec

  	
  126

  
	
  SECTION 9.19. Judgment Currency

  	
  126

  
	
  SECTION 9.20. Obligations of the
  Canadian Subsidiary Borrower and Foreign Subsidiary Loan Parties

  	
  127

  
	
  SECTION 9.21. Intercreditor Agreement

  	
  127

  
	
  SECTION 9.22. Effectiveness of
  Amendment and Restatement; No Novation

  	
  127

  
	
  SECTION 9.23. Amendment of Security
  Documents

  	
  128

  
	
  SECTION 9.24. Application of
  Collateral Proceeds

  	
  128

  
	
  SECTION 9.25. Bankruptcy Proceedings

  	
  129

  
	
  SECTION 9.26. Purchase Right

  	
  131

  

 

iii

 

	
  ARTICLE X

  	
   

  
	
   

  	
   

  
	
  Loan Guaranty

  	
   

  
	
   

  	
   

  
	
  SECTION 10.01.
  Guaranty

  	
  132

  
	
  SECTION 10.02.
  Guaranty of Payment

  	
  133

  
	
  SECTION 10.03.
  No Discharge or Diminishment of Loan Guaranty

  	
  133

  
	
  SECTION 10.04.
  Defenses Waived

  	
  133

  
	
  SECTION 10.05.
  Rights of Subrogation

  	
  134

  
	
  SECTION 10.06.
  Reinstatement; Stay of Acceleration

  	
  134

  
	
  SECTION 10.07.
  Information

  	
  134

  
	
  SECTION 10.08.
  Taxes

  	
  134

  
	
  SECTION 10.09.
  Maximum Liability

  	
  134

  
	
  SECTION 10.10.
  Contribution

  	
  135

  
	
  SECTION 10.11.
  Liability Cumulative

  	
  136

  

 

SCHEDULES:

 

Commitment Schedule

Schedule 1.01 – Eligible
Machinery and Equipment

Schedule 1.02 – Eligible Real
Property 

Schedule 1.03 – Mortgaged
Properties

Schedule 1.04 – Co-Investors

Schedule 1.05 – Fronting
Co-Investors

Schedule 1.06 – Secured Swap
Obligations

Schedule 3.03 – No Conflicts

Schedule 3.05(a) – Real
Property

Schedule 3.05(b) –
Intellectual Property

Schedule 3.06 – Disclosed
Matters

Schedule 3.09 – Taxes

Schedule 3.10(b) –
Canadian Pension Plans

Schedule 3.13 – Insurance

Schedule 3.14 – Capitalization
and Subsidiaries

Schedule 4.01(i) –
Excluded Mortgages

Schedule 6.01 – Existing
Indebtedness

Schedule 6.02 – Existing Liens

Schedule 6.04 – Existing
Investments

Schedule 6.09 – Transactions
with Affiliates

Schedule 6.10 – Existing
Restrictions

 

EXHIBITS:

 

Exhibit A – Form of
Assignment and Assumption

Exhibit B-1 – Form of
Opinion of Kirkland & Ellis LLP

Exhibit B-2 – Form of
Opinion of Blake, Cassels & Graydon LLP

Exhibit C – Form of
Borrowing Base Certificate

Exhibit D – Form of
Compliance Certificate

Exhibit E – Joinder
Agreement

Exhibit F-1 – Form of
Domestic Perfection Certificate

Exhibit F-2 – Form of
Canadian Perfection Certificate

Exhibit G-1 – Form of
Domestic Security Agreement

Exhibit G-2 – Form of
Canadian Reaffirmation Agreement

 

iv

 

AMENDED AND
RESTATED CREDIT AGREEMENT dated as of May 21, 2008 (as it may be amended
or modified from time to time, this “Agreement”), among INDALEX HOLDINGS
FINANCE, INC., a Delaware corporation (“Holdings”), INDALEX HOLDING
CORP., a Delaware corporation and a wholly-owned subsidiary of Holdings (the “Parent
Borrower”), INDALEX LIMITED, a Canadian corporation and a wholly-owned
subsidiary of the Parent Borrower (the “Canadian Subsidiary Borrower”),
the other Subsidiaries of the Parent Borrower party hereto, the Lenders party
hereto and JPMORGAN CHASE BANK, N.A., as Administrative Agent.

 

The Required
Restatement Lenders (capitalized terms used herein but not otherwise defined
shall have the meanings assigned to such terms in Section 1.01) are
willing, subject to the terms and conditions set forth in this Agreement, to
effect the amendment and restatement of the Original Credit Agreement as set
forth herein.  Accordingly, in
consideration of the mutual agreements contained herein and other good and
valuable consideration, the sufficiency and receipt of which are hereby
acknowledged, the parties hereto agree, subject to the satisfaction of the
conditions set forth herein, as follows:

 

ARTICLE I

 

Definitions

 

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

 

“AAG”
means Asia Aluminum Group Ltd.

 

“AAG
Disposition” means the sale, transfer or other disposition of any AAG
Investment or the Equity Interests of any AAG Entity.

 

“AAG Entity”
means any wholly-owned Subsidiary the only asset of which consists of all or a
portion of the AAG Investment.

 

“AAG
Investment” means the Equity Interests of AAG owned directly or indirectly
by the Parent Borrower or any Subsidiary as of the Effective Date.

 

“AAG
Proceeds” means the Net Proceeds from any AAG Disposition.

 

“AAG
Shareholders Agreement” means the Shareholders Agreement relating to AAG
dated June 8, 2001, among Asian Aluminum Holdings Limited, AAG Indalex UK
Limited and Indalex Inc. as in effect on the date hereof.

 

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

 

“Acceptance
Fee” has the meaning assigned to such term in Section 2.12(c).

 

“Account”
has the meaning assigned to such term in the Security Agreements.

 

“Account
Debtor” means any Person obligated on an Account.

 

 

“Acquisition”
means the acquisition by the Parent Borrower, directly or indirectly, of all
the Equity Interests of the U.S. Company and the Canadian Company pursuant to
the Purchase Agreement.

 

“Acquisition
Documents” means the Purchase Agreement, all other agreements to be entered
into in connection with the Acquisition and all schedules, exhibits and annexes
to each of the foregoing and all side letters, instruments and agreements
affecting the terms of the foregoing or entered into in connection therewith.

 

“Additional
Lender” has the meaning assigned to such term in Section 2.21(c).

 

“Adjusted
Eligible Accounts” means, at any time, the Eligible Accounts of (x) the
Parent Borrower and the wholly-owned Domestic Subsidiary Loan Parties at such
time, in the case of the Domestic Borrowing Base, or (y) the Canadian
Subsidiary Borrower and the wholly-owned Canadian Subsidiary Loan Parties at
such time, in the case of the Canadian Borrowing Base, in each case minus
the applicable Dilution Reserve at such time.

 

“Adjusted
LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest
Period, an interest rate per annum (rounded upwards, if necessary, to the next
1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period multiplied
by (b) the Statutory Reserve Rate.

 

“Administrative
Agent” means (x) JPMorgan Chase Bank, N.A., in its capacity as
administrative agent for the Lenders hereunder (or, as applicable, such
Affiliates thereof as it shall from time to time designate for the purpose of
performing its obligations hereunder in such capacity), and (y) with
respect to Loans or Borrowings made to, or B/A Drawings made by, the Canadian
Subsidiary Borrower, or Letters of Credit issued for the account of the
Canadian Subsidiary Borrower or any Foreign Subsidiary, JPMorgan Chase Bank,
N.A., Toronto Branch (or, as applicable, such Affiliates thereof as it shall
from time to time designate for the purpose of performing its obligations
hereunder in such capacity), and, in each case, its successors in such capacity
as provided in Article VIII.

 

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

 

“Affiliate”
means, with respect to a specified Person, another Person that directly, or
indirectly through one or more intermediaries, Controls or is Controlled by or
is under common Control with the Person specified; provided, however,
that for purposes of Section 6.09, the term “Affiliate” shall also include
any person that directly, or indirectly through one or more intermediaries,
owns 10% or more of any class of Equity Interests of the Person specified or
that is an officer or director of the Person specified.

 

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

 

“ALTA”
means the American Land Title Association.

 

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

 

“Applicable
Percentage” means, at any time with respect to any Revolving Lender, the 

 

2

 

percentage of the aggregate Revolving
Commitments at such time represented by such Lender’s Revolving Commitment at
such time.  If the Revolving Commitments
have terminated or expired, the Applicable Percentages shall be determined
based upon the Revolving Commitments most recently in effect, giving effect to
any assignments of Revolving Exposure that occur after such termination or
expiration.

 

“Applicable
Rate” means, for any day, with respect to any (a) any Term Loan, (i) 7.50%,
in the case of any Eurodollar Term Loan, and (ii) 6.50%, in the case of
any ABR Term Loan, provided that, at any time when Average Availability
is less than $35,000,000, the Applicable Rate with respect to any Term Loan
shall be (x) 8.25%, in the case of any Eurodollar Term Loan, and (y) 7.25%,
in the case of any ABR Term Loan, and (b) Eurodollar Revolving Loan, ABR
Revolving Loan, U.S. Base Rate Revolving Loan or Canadian Base Rate Revolving
Loan, or with respect to the B/A Drawings and the Commitment Fees payable
hereunder, as the case may be, the applicable rate per annum set forth below
under the caption “Eurodollar Spread and B/A Rate”, “ABR, U.S. Base Rate and
Canadian Base Rate Spread” or “Commitment Fee Rate”, as the case may be, based
upon the Average Availability determined as of the date of the most recent
Borrowing Base Certificate delivered pursuant to Section 5.01(f) (calculated
as of the end of such day), provided that on or prior to April 30,
2006, the “Applicable Rate” with respect to any Loan or fee shall be deemed to
be in Category 2:

 

	
  Average Availability

  	
   

  	
  Eurodollar Spread

  and

  B/A Rate

  	
   

  	
  ABR, U.S. Base Rate and

  Canadian Base Rate

  Spread

  	
   

  	
  Commitment

  Fee Rate

  	
   

  
	
  Category 1 3
  $130,000,000

  	
   

  	
  1.75

  	
  %

  	
  0.75

  	
  %

  	
  0.375

  	
  %

  
	
  Category 2 <
  $130,000,000 3 $65,000,000

  	
   

  	
  2.00

  	
  %

  	
  1.00

  	
  %

  	
  0.375

  	
  %

  
	
  Category 3 <
  $65,000,000

  	
   

  	
  2.25

  	
  %

  	
  1.25

  	
  %

  	
  0.375

  	
  %

  

 

Notwithstanding the foregoing,
the Applicable Rate with respect to any Revolving Loan or fee shall be deemed
to be in Category 3 (a) at any time that an Event of Default has
occurred and is continuing or (b) at the option of the Administrative
Agent or at the request of the Required Lenders if the Parent Borrower fails to
deliver any Borrowing Base Certificate required to be delivered by it pursuant
to Section 5.01(f), during the period from the expiration of the time for
delivery thereof until such Borrowing Base Certificate is delivered.

 

“Approved
Fund” has the meaning assigned to such term in Section 9.04(b).

 

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

 

3

 

“Availability”
means, at any time, an amount equal to (a) the Total Borrowing Base at
such time, minus (b) the aggregate Revolving Exposure at such time.

 

“Availability
Block” means an amount equal to $15,000,000.

 

“Availability
Period” means the period from and including the Effective Date to but
excluding the earlier of the Maturity Date and the date of termination of the
Revolving Commitments.

 

“Average
Availability” means, on any day, an amount equal to the quotient of (a) the
sum of the end of day Availability for each day during the most recently ended
period of three consecutive full calendar months, divided by (b) the
number of days in such three-month period. 
Notwithstanding the foregoing, in the event the Borrowing Base
Certificate is delivered on a weekly basis pursuant to Section 5.01(f),
Average Availability means, on any day, an amount equal to the quotient of (a) the
sum of the end of day Availability for each day during the most recently ended
period of twelve consecutive full calendar weeks, divided by (b) the
number of days in such twelve-week period.

 

“B/A” means a bill of exchange, including
a depository bill issued in accordance with the Depository Bills and Notes Act
(Canada), denominated in Canadian Dollars, drawn by the Canadian Subsidiary
Borrower and accepted by a Revolving Lender in accordance with the terms of
this Agreement and any such bill of exchange drawn by the Canadian Subsidiary
Borrower and accepted by a Revolving Lender in accordance with the terms of the
Original Credit Agreement that is outstanding on the Restatement Effective Date.

 

“B/A
Drawing”  means B/As accepted
and purchased on the same date and as to which a single Contract Period is in
effect, including any B/A Equivalent Loans made on the same date and as to
which a single Contract Period is in effect. 
For greater certainty, all provisions of this Agreement that are
applicable to B/As are also applicable, mutatis  mutandis, to B/A Equivalent Loans
and, with respect to any Non-B/A Lender, all references herein to B/As shall be
deemed to include references to B/A Equivalent Loans.

 

“B/A
Equivalent Loan” has the meaning assigned to such term in Section 2.06(k).

 

“Banking
Services” means each and any of the following bank services provided to any
Loan Party by any Revolving Lender or any of its Affiliates: (a) commercial
credit cards, (b) stored value cards and (c) treasury management
services (including controlled disbursement, currency, automated clearinghouse
transactions, return items, overdrafts and interstate depository network
services).

 

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

 

“Bankruptcy
Code” means Title 11 of the United States Code entitled “Bankruptcy Code”,
as now and hereinafter in effect, or any successor statute.

 

“Bankruptcy
Law” means the Bankruptcy Code and any other Federal, state or foreign
bankruptcy, insolvency, receivership or similar law.

 

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

 

4

 

“Borrowers”
means, collectively, the Parent Borrower and the Canadian Subsidiary Borrower.

 

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

 

“Borrowing
Base Certificate” means a certificate, signed and certified as accurate and
complete by a Financial Officer or any other officer of the Parent Borrower
reasonably acceptable to the Administrative Agent, in substantially the form of
Exhibit C or another form that is reasonably acceptable to the
Administrative Agent in its sole discretion, which shall include appropriate
exhibits, schedules, supporting documentation and additional reports (a) as
outlined in Schedule 1 to Exhibit C, (b) as reasonably
requested by the Administrative Agent and (c) as provided for in Section 5.01(f).

 

“Borrowing
Request” means a request by the applicable Borrower for a Borrowing in
accordance with Section 2.03.

 

“Business
Day” means any day that is not a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to remain
closed, provided that (a) when used in connection with a Eurodollar
Loan, the term “Business Day” shall also exclude any day on which banks are not
open for dealings in U.S. Dollar deposits in the London interbank market, and (b) when
used in connection with a Loan made to, or a Letter of Credit issued for the
account of, the Canadian Subsidiary Borrower or a B/A, the term “Business Day”
shall also (i) exclude any day on which banks are not open for dealings in
deposits in Toronto but (ii) include any day on which banks are open for
dealings in deposits in Toronto.

 

“Canadian
Base Rate” means, for any day, the rate of interest per annum equal to the
greater of (a) the interest rate per annum publicly announced from time to
time by the Administrative Agent as its prime rate in effect on such day at its
principal office in Toronto for determining interest rates applicable to
commercial loans denominated in Canadian Dollars in Canada and (b) the
interest rate per annum equal to the sum of (i) the CDOR Rate on such day
and (ii) 1⁄2 of 1% per annum.  Any
change in such prime rate or the CDOR Rate shall be effective as of the opening
of business on the effective date of such change in the reference rate or the
CDOR Rate, respectively.

 

“Canadian
Benefit Plans” means all employee benefit plans maintained or contributed
to by the Borrowers or any Subsidiary that are not Canadian Pension Plans,
including all profit sharing, savings, post-retirement, supplemental
retirement, retiring allowance, severance, pension, deferred compensation,
welfare, bonus, incentive compensation, phantom stock, legal services,
supplementary unemployment benefit plans or arrangements and all life, health,
dental and disability plans and arrangements in which the employees or former
employees of the Borrowers or any Subsidiary employed in Canada participate or
are eligible to participate.

 

“Canadian
Borrowing Base” means, at any time, the sum of (a) 85% of the U.S.
Dollar Equivalent of the aggregate Adjusted Eligible Accounts of the Canadian
Subsidiary Borrower and the wholly-owned Canadian Subsidiary Loan Parties at
such time, plus (b) the lesser of (i) 85% of the product of (x) the
Net Recovery Liquidation Rate in effect (based on the then most recent
independent Inventory appraisal in form, scope and substance reasonably
satisfactory to the Administrative Agent) at such time multiplied by (y) the
U.S. Dollar Equivalent of the aggregate amount of Inventory of the Canadian
Subsidiary Borrower and the wholly-owned Canadian Subsidiary Loan Parties at
such time (as reported in accordance with the applicable Loan Party’s Inventory
records), and (ii) the sum of (A) 75% of the U.S. Dollar Equivalent
of the aggregate cost of Eligible Aluminum Billets and (B) 65% of the U.S.
Dollar 

 

5

 

Equivalent of the aggregate cost of Other
Eligible Inventory, in each case of the Canadian Subsidiary Borrower and the
wholly-owned Canadian Subsidiary Loan Parties at such time (in the case of each
of subclauses (i) and (ii) of this clause (b), with any Inventory,
Eligible Inventory, Eligible Aluminum Billets and Other Eligible Inventory to
be valued on a first-in, first-out basis), provided that the aggregate
amount determined pursuant to this clause (b) shall not constitute more
than 50% of the Canadian Borrowing Base at such time, plus (c) the PP&E Component at such
time minus (d) Reserves with respect to the Canadian
Subsidiary Borrower and the wholly-owned Canadian Subsidiary Loan Parties at
such time.  The Administrative Agent may,
in its Permitted Discretion, from time to time, reduce the advance rates set
forth above or establish and revise ineligibles and Reserves reducing the
amount of Eligible Accounts, Inventory, Eligible Inventory, Eligible Aluminum
Billets, Other Eligible Inventory, Eligible Machinery and Equipment and
Eligible Real Property used in computing the Canadian Borrowing Base, with any
such changes to be effective five Business Days after delivery of notice
thereof to the Canadian Subsidiary Borrower and the Lenders (which notice shall
describe in reasonable detail the reasons for such changes), provided
that any Reserve established by the Administrative Agent shall not apply in
respect of items excluded from Eligible Accounts, Eligible Inventory, Eligible
Aluminum Billets, Other Eligible Inventory, Eligible Machinery and Equipment
and Eligible Real Property pursuant to the definitions thereof or covered by
any other Reserve in effect at the time such Reserve is established.  The Canadian Borrowing Base at any time shall
be determined by reference to the most recent Borrowing Base Certificate
delivered to the Administrative Agent pursuant to Section 5.01(f) of
this Agreement.

 

“Canadian
Company” means Indalex Limited, a Canadian corporation (Corporation No. 4214269).

 

“Canadian
Dollars” or “C$” means the lawful money of Canada.

 

“Canadian
GAAP” means the generally accepted accounting principles in Canada.

 

“Canadian
Hypothec” means a trust deed of hypothec granted or to be granted by any
Loan Party in favor of the Administrative Agent on moveable or immoveable
property pursuant to the laws of the Province of Quebec, together with all
bonds, debentures and pledges or hypothecs thereof, as amended, supplemented or
otherwise modified from time to time.

 

“Canadian
L/C Disbursement” means a payment made by the Issuing Bank pursuant to a
Letter of Credit issued for the account of the Canadian Subsidiary Borrower or
for the account of any Foreign Subsidiary.

 

“Canadian
L/C Exposure” means, at any time, the sum of (a) the aggregate undrawn
amount of all outstanding Letters of Credit issued for the account of the
Canadian Subsidiary Borrower and the Foreign Subsidiaries at such time plus
(b) the aggregate amount of all Canadian L/C Disbursements that have not
yet been reimbursed (including by the making of Revolving Loans hereunder) by
or on behalf of the Canadian Subsidiary Borrower and the Foreign Subsidiaries
at such time.  The Canadian L/C Exposure
of any Revolving Lender at any time shall be its Applicable Percentage of the
Canadian L/C Exposure at such time.

 

“Canadian
Lending Office” means, as to any Lender, the applicable branch, office or
Affiliate of such Lender designated by such Lender to make Canadian Revolving
Loans to the Canadian Subsidiary Borrower and to accept and purchase or arrange
for the purchase of B/As.

 

“Canadian
Mortgage” means a mortgage, deed of trust, assignment of leases and rents,
leasehold mortgage or other security document (including any amendment
(including any amendments as of the date hereof pursuant to the terms of the
Canadian Reaffirmation Agreement), modification or 

 

6

 

supplement thereto) granting a Lien on any
Mortgaged Property located in Canada or any province thereof to secure the
Canadian Secured Obligations.  Each
Canadian Mortgage shall be reasonably satisfactory in form and substance to the
Administrative Agent.

 

“Canadian
Multi-Employer Plan” means a multi-employer plan within the meaning of the
Regulations under the Canadian Tax Act and applicable pension standards
legislation in Canada.

 

“Canadian
Obligations” means (a) all unpaid principal of and accrued and unpaid
interest on Loans made to the Canadian Subsidiary Borrower (including all
interest accrued or accruing (or which would, absent commencement of an
Insolvency or Liquidation Proceeding, accrue) after commencement of an
Insolvency or Liquidation Proceeding in accordance with the rate specified in
this Agreement, whether or not the claim for such interest is allowed as a
claim in such Insolvency or Liquidation Proceeding), (b) all Canadian L/C
Exposure in respect of Letters of Credit issued for the account of the Canadian
Subsidiary Borrower and the Foreign Subsidiaries, (c) the aggregate face
amount due in respect of outstanding B/As and (d) all accrued and unpaid
fees and all expenses, reimbursements, indemnities and other obligations of the
Canadian Subsidiary Borrower and the Foreign Subsidiary Loan Parties owed to
the Lenders or to any Lender, the Administrative Agent, the Issuing Bank or any
indemnified party arising under the Loan Documents (including the Guarantees
provided by the Foreign Loan Guarantors pursuant to Article X).

 

“Canadian
Pension Plan” means any “registered pension plan” as defined in the Income Tax Act  (Canada) established or maintained by either
Borrower or any Subsidiary for their employees or former employees employed in
Canada and for greater certainty does not include a Canadian Multi-Employer
Plan.

 

“Canadian
Perfection Certificate” means, at any time, the certificate most-recently
delivered to the Administrative Agent (a) in the case of the Restatement
Effective Date, pursuant to Section 4.01(f) or (b) thereafter,
pursuant to Section 3.03(c) of the Canadian Security Agreement, in
each case in the form of Exhibit F-2 or any other form approved by
the Administrative Agent.

 

“Canadian
Reaffirmation Agreement” means the Canadian Reaffirmation Agreement dated
as of the date hereof, substantially in the form attached hereto as Exhibit G-2,
among the Parent Borrower, the Canadian Subsidiary Borrower, the Subsidiaries
party thereto and the Administrative Agent.

 

“Canadian
Resident” means a Person that is (a) resident in Canada for purposes
of the Canadian Tax Act or (b) deemed to be resident in Canada for
purposes of the Canadian Tax Act in respect of all amounts paid or credited
hereunder by the Canadian Subsidiary Borrower and the Canadian Subsidiary Loan
Parties.

 

“Canadian
Revolving Exposure” means, at any time, the sum of (a) the U.S. Dollar
Equivalent of the aggregate principal amount of Canadian Revolving Loans
denominated in Canadian Dollars outstanding at such time, (b) the aggregate
principal amount of the Canadian Revolving Loans denominated in U.S. Dollars
outstanding at such time, (c) the U.S. Dollar Equivalent of the aggregate
face amount of the B/As accepted by the Lenders and outstanding at such time, (d) the
U.S. Dollar Equivalent of the Canadian L/C Exposure at such time and (e) the
U.S. Dollar Equivalent of the Canadian Swingline Exposure at such time.  The Canadian Revolving Exposure of any
Revolving Lender at any time shall be its Applicable Percentage of the Canadian
Revolving Exposure at such time.

 

“Canadian
Revolving Loan” means a Loan made by a Revolving Lender pursuant to Section 2.01(b) and
any loan made by a Revolving Lender pursuant to Section 2.01(b) of
the Original 

 

7

 

Credit Agreement that is outstanding on the
Restatement Effective Date.  Each
Canadian Revolving Loan (a) denominated in Canadian Dollars shall be a
Canadian Base Rate Revolving Loan and (b) denominated in U.S. Dollars
shall be a U.S. Base Rate Revolving Loan or a Eurodollar Revolving Loan.

 

“Canadian
Revolving Sub-Commitment” means, with respect to each Revolving Lender, the
commitment of such Lender to make Canadian Revolving Loans, acquire
participations in Letters of Credit and Swingline Loans and accept and
purchase, or arrange for the purchase of, B/As hereunder during the
Availability Period, expressed as an amount expressed in U.S. Dollars
representing the maximum potential aggregate amount of such Lender’s Canadian
Revolving Exposure, as such commitment may be (a) reduced from time to
time pursuant to Section 2.09 or Section 2.19(b), (b) reduced or
increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 9.02(d), Section 9.02(e) or Section 9.04
or (c) increased from time to time pursuant to Revolving Commitment
Increases made pursuant to Section 2.21. 
The initial amount of each Revolving Lender’s Canadian Revolving
Sub-Commitment is set forth opposite such Lender’s name in the Commitment
Schedule directly below the column entitled “Canadian Revolving
Sub-Commitments” or in the Assignment and Assumption or Commitment Increase
Amendment pursuant to which such Lender shall have assumed its Canadian
Revolving Sub-Commitment, as applicable, and, in any such case, shall be equal
to such Lender’s Applicable Percentage of the aggregate Canadian Revolving
Sub-Commitments.  The initial aggregate
amount of the Revolving Lenders’ Canadian Revolving Sub-Commitments is
$80,000,000.

 

“Canadian
Secured Obligations” means all Canadian Obligations, together with (a) Banking
Services Obligations of the Canadian Subsidiary Borrower and the Foreign
Subsidiary Loan Parties and (b) Swap Obligations entered into by the
Canadian Subsidiary Borrower and the Foreign Subsidiary Loan Parties owing to
one or more Revolving Lenders or their respective Affiliates (including any
such Swap Obligations set forth on Schedule 1.06), provided that, solely
with respect to any Swap Obligation arising on or after the Restatement
Effective Date, at or prior to the time that any transaction relating to any
such Swap Obligation is executed, the Revolving Lender or Affiliate of such
Lender, in each case party thereto (other than JPMorgan Chase Bank, N.A.,
Toronto Branch, or any of its Affiliates) shall have delivered written notice
to the Administrative Agent that such a transaction has been or will be entered
into and that it constitutes a Canadian Secured Obligation entitled to the
benefits of the applicable Collateral Documents.

 

“Canadian
Security Agreement” means the Canadian Security Agreement dated as of February 2,
2006, as amended as of the date hereof pursuant to the terms of the Canadian
Reaffirmation Agreement (as further amended, amended and restated, supplemented
or modified from time to time in accordance with this Agreement), among the
Parent Borrower, the Canadian Subsidiary Borrower, each Subsidiary Loan Party
party thereto and the Administrative Agent.

 

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

 

“Canadian
Swingline Exposure” means, at any time, the aggregate principal amount of
all Swingline Loans made to the Canadian Subsidiary Borrower at such time.  The Canadian Swingline Exposure of any
Revolving Lender at any time shall be its Applicable Percentage of the Canadian
Swingline Exposure at such time.

 

“Canadian
Subsidiary Loan Party” means any Subsidiary that is organized under the
laws of Canada or any territory or province thereof (other than the Canadian
Subsidiary Borrower) and that is a Foreign Subsidiary Loan Party.

 

8

 

“Canadian
Tax Act” means the Income Tax Act (Canada) or any successor law purported
to cover the same subject matter, as amended from time to time.

 

“Capital
Expenditures” means, for any period, (a) the additions to property,
plant and equipment and other capital expenditures of the Parent Borrower and
the Subsidiaries that are (or should be) set forth in a consolidated statement
of cash flows of the Parent Borrower for such period prepared in accordance
with GAAP and (b) Capital Lease Obligations incurred by the Parent
Borrower and the Subsidiaries during such period, but excluding in each case (i) any
such expenditure made by the Parent Borrower or the applicable Subsidiary as
payment of the consideration for a Permitted Acquisition, (ii) any
reinvestments in capital assets made by the Parent Borrower or the applicable
Subsidiary to the extent made or committed to be made (x) with the Net
Proceeds of any sales, transfers or other dispositions of capital assets
permitted hereunder (including any like-kind exchanges) or under the other Loan
Documents (including any award by condemnation) or the Net Proceeds of
insurance relating to the loss of or damage to any capital asset and (y) within
180 days of the receipt by the Parent Borrower or such Subsidiary of such Net
Proceeds, (iii) expenditures made by the Parent Borrower or the applicable
Subsidiary to effect leasehold improvements to any property leased by the
Parent Borrower or such Subsidiary to the extent such expenditures are
reimbursed by the landlord in respect of such property, (iv) expenditures
actually paid for by a third party (excluding Holdings or any subsidiary
thereof) and for which no Loan Party has provided or is required to provide any
consideration to such third party, (v) research and development
expenditures that are treated as additions to property, plant and equipment or
other capital expenditures in accordance with GAAP and (vi) expenditures
made with the Net Proceeds of any issuances of Qualified Equity Interests by
Holdings or capital contributions to the Parent Borrower.

 

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

 

“CDOR Rate”
means, on any date, an interest rate per annum equal to the average discount
rate applicable to bankers’ acceptances denominated in Canadian Dollars with a
term of 30 days (for purposes of the definition of “Canadian Base Rate”) or
with a term equal to the Contract Period of the relevant B/As and a face amount
comparable to the face amount of the relevant B/As (for purposes of the
definition of “Discount B/A Rate”) appearing on the Reuters Screen CDOR Page (or
on any successor or substitute page of such Screen, or any successor to or
substitute for such Screen, providing rate quotations comparable to those
currently provided on such page of such Screen, as determined by the
Administrative Agent from time to time) at approximately 10:00 a.m.,
Toronto time, on such date (or, if such date is not a Business Day, on the next
preceding Business Day) or, if such rate is not so reported, the average of the
rate quotes for bankers’ acceptances denominated in Canadian Dollars (expressed
as a decimal and rounded upward, if necessary, to the nearest 1/100 of 1%) with
a term of 30 days (for purposes of the definition of “Canadian Base Rate”) or
with a term equal to the Contract Period of the relevant B/As and a face amount
comparable to the face amount of the relevant B/As (for purposes of the
definition of “Discount B/A Rate”) received by the Administrative Agent at
approximately 10:00 a.m., Toronto time, on such date (or, if such date is
not a Business Day, on the next preceding Business Day) from the Schedule I
Reference Lenders.

 

“Change in
Control” means (a) the acquisition of ownership, directly or
indirectly, beneficially or of record, prior to an IPO (or after an IPO if
Holdings is the Public Company after such IPO) by any Person other than
Holdings of any Equity Interests in the Parent Borrower, (b) prior to an
IPO, the failure by the Permitted Holders to own, directly or indirectly
through a wholly-owned 

 

9

 

subsidiary, beneficially and of record,
Equity Interests in Holdings representing at least a majority of the aggregate
ordinary voting power and 40% of the aggregate equity value represented by the
issued and outstanding Equity Interests in Holdings, (c) after an IPO, (i) the
acquisition of ownership, directly or indirectly, beneficially or of record, by
any Person or group (within the meaning of the Exchange Act and the rules of
the SEC thereunder as in effect on the date hereof) other than the Permitted
Holders, of Equity Interests representing more than 40% of the aggregate
ordinary voting power represented by the issued and outstanding Equity
Interests of the Public Company, and (ii) the ownership, directly or
indirectly, beneficially or of record, by the Permitted Holders of Equity
Interests in the Public Company representing in the aggregate a lesser
percentage of either the aggregate ordinary voting power or the aggregate
equity value represented by the issued and outstanding Equity Interests in the
Public Company than such Person or group, (d) the occupation of a majority
of the seats (other than vacant seats) on the board of directors of Holdings
(prior to an IPO) or the Public Company (after an IPO) by Persons who were
neither (i) nominated by the board of directors of Holdings or the Public
Company, as the case may be (or nominated by a third party and approved by such
board of directors), or the Permitted Holders nor (ii) appointed by
directors so nominated or (e) the occurrence of a “Change of Control” (or
similar event, however denominated), as defined in any Senior Secured Notes
Documents, any indenture or agreement in respect of Material Indebtedness of
Holdings, the Parent Borrower or any Subsidiary or any certificate of
designations (or other provision of the organizational documents of Holdings)
relating to, or any other agreement governing the rights of the holders of, any
Disqualified Equity Interests.

 

“Change in
Law” means (a) the adoption of any law, rule or regulation after
the Effective Date (or, solely in respect of any Term Loan, the Restatement
Effective Date), (b) any change in any law, rule or regulation or in
the interpretation or application thereof by any Governmental Authority after
the Effective Date (or, solely in respect of any Term Loan, the Restatement
Effective Date) or (c) compliance by any Lender or the Issuing Bank (or,
for purposes of Section 2.15(b), by any lending office of such Lender or
by such Lender’s or the Issuing Bank’s holding company, if any) with any
request, guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the Effective Date (or, solely in
respect of any Term Loan, the Restatement Effective Date).

 

“Class”,
when used in reference to any Loan or Borrowing, refers to whether such Loan,
or the Loans comprising such Borrowing, are U.S. Revolving Loans, Canadian
Revolving Loans, an Initial Term Loan, an Incremental Term Loan or Swingline
Loans and, when used in reference to any Commitment, refers to whether such
Commitment is a U.S. Revolving Commitment, Canadian Revolving Sub-Commitment,
Initial Term Commitment or a Commitment in respect of an Incremental Term Loan.

 

“Class”,
when used in reference to any Lender, refers to whether such Lender has a Loan
or Commitment with respect to a particular Class.

 

“CLO”
has the meaning assigned to such term in Section 9.04(b).

 

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

 

“Co-Investor
Fronting Loans” means the loans made to Holdings by the Sponsor on the
Effective Date in an aggregate amount not to exceed $1,500,000 in lieu of the
Equity Contribution to be made by the Fronting Co-Investors on the Effective
Date.

 

“Co-Investors”
means the Persons listed on Schedule 1.04 and their successors and
assigns.

 

“Collateral”
means all the “Collateral” as defined in any Collateral Document and shall also
include the Mortgaged Properties.

 

10

 

“Collateral
Access Agreement” has the meaning assigned to such term in the Security
Agreements.

 

“Collateral
Documents” means, collectively, the Security Agreements, the Canadian
Hypothecs, the Mortgages and any other documents granting a Lien upon the
Collateral as security for payment of the Secured Obligations specified
therein.

 

“Commitment”
means (a) with respect to any Lender, such Lender’s Revolving Commitment,
Canadian Revolving Sub-Commitment, Initial Term Commitment, commitment in
respect of any Revolving Commitment Increase, commitment in respect of an
Incremental Term Loan or any combination thereof (as the context requires) and (b) with
respect to the Swingline Lender, its Swingline Commitment.

 

“Commitment
Fee” has the meaning assigned to such term in Section 2.12(a).

 

“Commitment
Increase Amendment” has the meaning assigned to such term in Section 2.21(c).

 

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

 

“Consolidated
Cash Interest Expense” means, for any period, the excess of (a) the
sum of (i) the interest expense (including imputed interest expense in
respect of Capital Lease Obligations, but net of any interest income) of
Holdings, the Parent Borrower and the Subsidiaries for such period, determined
on a consolidated basis in accordance with GAAP, (ii) any interest accrued
during such period in respect of Indebtedness of Holdings, the Parent Borrower
or any Subsidiary that is required to be capitalized rather than included in
consolidated interest expense for such period in accordance with GAAP, and (iii) any
cash payments made during such period in respect of obligations referred to in
clause (b)(ii) below that were amortized or accrued in a previous
period, minus (b) the sum of (i) to the extent included in
such consolidated interest expense for such period in accordance with GAAP,
non-cash amounts attributable to amortization of financing costs (including
debt issuance fees) paid in a previous period, (ii) to the extent included
in such consolidated interest expense for such period in accordance with GAAP,
non-cash amounts attributable to amortization of debt discounts or accrued
non-cash interest payments for such period and (iii) to the extent
included in such consolidated interest expense for such period in accordance
with GAAP, any fees (including underwriting fees) and expenses paid in
connection with the consummation of the Transactions.

 

“Consolidated
EBITDA” means, for any period, Consolidated Net Income for such period plus
(a) without duplication and to the extent deducted in determining such
Consolidated Net Income, the sum of (i) consolidated interest expense,
amortization or write-off of debt discount and debt issuance costs and
commissions, discounts and other fees and charges associated with Indebtedness
for such period, (ii) consolidated income tax expense (and expenses for
franchise tax in the nature of income tax) and foreign withholding tax expense
for such period and any expense for state single business, unitary, gross
receipts or similar taxes for such period, (iii) all amounts attributable
to depreciation and amortization (including amortization of intangibles
(including goodwill and organizational costs)) for such period (excluding any
amortization expense attributable to a prepaid cash item that was paid in a
prior period), (iv) any extraordinary, unusual or non-recurring non-cash
charges for such period (but excluding any such non-cash charge in respect of
an item to the extent that it was included in Consolidated Net Income in a
prior period and any such charge that results from the write-down or write-off
of inventory), (v) fees and expenses incurred during such period in
connection with (A) the Original Transactions in an aggregate amount not
to exceed $25,000,000 and (B) the Restatement Transactions and any sale
and leaseback transactions permitted hereunder in an aggregate amount not to
exceed 

 

11

 

$3,000,000, (vi) fees and expenses
incurred during such period in connection with any proposed or actual issuance
of any Indebtedness or Equity Interests, or any proposed or actual investments
(including Permitted Acquisitions), asset sales or divestitures, in each case
permitted hereunder, in an aggregate amount not to exceed (for each such
transaction, other than an IPO) 2.0% of the aggregate value of such
transaction, (vii) the amount of management, consulting and advisory fees,
transaction fees and the amount of out-of-pocket costs and expenses incurred in
connection with management, consulting and advisory services, in each case paid
or payable to the Sponsor or any Sponsor Affiliate during such period in
accordance with Section 6.09(f), (viii) non-cash expenses resulting
from the grant of stock options or other equity-related incentives to any
director, officer or employee of Holdings, the Parent Borrower or any
Subsidiary pursuant to a written plan or agreement approved by the board of
directors of Holdings, (ix) non-cash exchange, translation or performance
losses relating to any foreign currency or commodities hedging transactions or
currency fluctuations, (x) to the extent actually reimbursed to Holdings,
the Parent Borrower or any Subsidiary, expenses during such period that are
covered by indemnification provisions in any agreement entered into by
Holdings, the Parent Borrower or such Subsidiary in connection with the
Acquisition or any Permitted Acquisition, (xi) any non-cash losses during such
period resulting from the application of Financial Accounting Standards No. 142
(relating to changes in accounting for the amortization of goodwill and certain
other intangibles) and Financial Accounting Standards No. 144 (relating to
writedowns of long-lived assets), (xii) payments by Holdings, the Parent
Borrower or any Subsidiary in respect of earn-outs to which the seller in any
acquisition or disposition becomes entitled during such period, (xiii) any loss
during such period in respect of post-retirement benefits as a result of the
application of Financial Accounting Standards No. 106, (xiv) any loss
during such period from discontinued operations and any restructuring charges
during such period, together in an aggregate amount not to exceed $8,000,000 in
any four-fiscal-quarter period of the Parent Borrower, (xv) any loss resulting
from the disposition of any asset of Holdings, the Parent Borrower or any
Subsidiary not in the ordinary course of business and (xvi) charges during such
period in respect of legal, pension, warranty and severance costs relating to
discontinued businesses that are unrelated to the business of the Parent
Borrower and the Subsidiaries, minus (b) without duplication and
(except in the case of clause (i)) to the extent included in determining such
Consolidated Net Income, the sum of (i) any cash disbursements during such
period that relate to non-cash charges or losses added to Consolidated Net
Income pursuant to clause (a)(iv) or (a)(viii) of this paragraph in
any prior period, (ii) any extraordinary, unusual or non-recurring
non-cash gains for such period, (iii) any non-cash gains for such period
that represent the reversal of any accrual in a prior period for, or the reversal
of any cash reserves established in a prior period for, anticipated cash
charges, (iv) non-cash exchange, translation or performance gains relating
to any foreign currency or commodities hedging transactions or currency
fluctuations, (v) any non-cash gains during such period resulting from the
application of Financial Accounting Standards No. 142 (relating to changes
in accounting for the amortization of goodwill and certain other intangibles)
and Financial Accounting Standards No. 144 (relating to writedowns of
long-lived assets), (vi) any gain during such period in respect of
post-retirement benefits as a result of the application of Financial Accounting
Standards No. 106, (vii) any gain during such period from
discontinued operations of the Parent Borrower and (viii) any gain
resulting from the disposition of any asset of Holdings, the Parent Borrower or
any Subsidiary not in the ordinary course of business, all determined on a
consolidated basis in accordance with GAAP.

 

“Consolidated
Net Income” means, for any period, the net income (excluding interest
income) or loss of Holdings, the Parent Borrower and the Subsidiaries for such
period determined on a consolidated basis in accordance with GAAP, provided
that there shall be excluded (a) the income of any Subsidiary to the
extent that the declaration or payment of dividends or other distributions by
such Subsidiary of that income is not at the time permitted by a Requirement of
Law or any agreement or instrument applicable to such Subsidiary (other than
the Loan Documents and the Senior Secured Notes Documents), except to the
extent of the amount of cash dividends or other cash distributions actually
paid to the Parent Borrower or any Subsidiary (other than cash dividends or
other cash distributions that 

 

12

 

constitute Excluded Proceeds) (unless the
income of such Subsidiary would be excluded from Consolidated Net Income
pursuant to clause (b) of this proviso) during such period, (b) the
income of any Person (other than the Parent Borrower or any Subsidiary that is
not accounted for using the equity method of accounting) in which the Parent
Borrower or any Subsidiary owns an Equity Interest (including the AAG
Investment), except to the extent of the amount of cash dividends or other cash
distributions actually paid to the Parent Borrower or any Subsidiary (other
than cash dividends or other cash distributions that constitute Excluded
Proceeds) (unless the income of such Subsidiary would be excluded from Consolidated
Net Income pursuant to clause (a) of this proviso) during such
period, (c) unrealized gains and losses with respect to Swap Agreements
during such period and (d) the effects of purchase accounting or similar
adjustments required or permitted by GAAP in connection with the Acquisition or
any Permitted Acquisition.

 

“Contract
Period” means, with respect to any B/A, the period commencing on the date
such B/A is issued and accepted and ending on the date 30, 60, 90 or 180 days
thereafter, as the Canadian Subsidiary Borrower may elect (in each case subject
to availability), or any other number of days from 1 to 180 with the consent of
each applicable Revolving Lender, provided that if such Contract Period
would end on a day other than a Business Day, such Contract Period shall be
extended to the next succeeding Business Day.

 

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

 

“DIP
Financing” has the meaning assigned to such term in Section 9.25(b).

 

“Default”
means any event or condition that constitutes an Event of Default or that upon
notice, lapse of time or both would, unless cured or waived, become an Event of
Default.

 

“Delivery
Trigger Date” has the meaning assigned to such term in Section 2.22.

 

“Deposit
Account Control Agreement” has the meaning assigned to such term in the
Security Agreements.

 

“Dilution
Factors” means, without duplication, with respect to any period, the
aggregate amount of all deductions, credit memos, returns, adjustments,
allowances, bad debt write-offs and other non-cash credits that are recorded
during such period to reduce (x) with respect to the Domestic Borrowing
Base, the Accounts of the Parent Borrower and the wholly-owned Domestic
Subsidiary Loan Parties in a manner consistent with current and historical
accounting practices of the Parent Borrower and such Domestic Subsidiary Loan
Parties, as the case may be, or (y) with respect to the Canadian Borrowing
Base, the Accounts of the Canadian Subsidiary Borrower and the wholly-owned
Canadian Subsidiary Loan Parties in a manner consistent with current and
historical accounting practices of the Canadian Subsidiary Borrower and such
Canadian Subsidiary Loan Parties, as the case may be.

 

“Dilution
Ratio” means, on any date, the quotient (expressed as a percentage) equal
to (x) with respect to the Domestic Borrowing Base, (i) the aggregate
amount of the Dilution Factors in respect of the Accounts of the Parent
Borrower and the wholly-owned Domestic Subsidiary Loan Parties for the twelve
fiscal month period most recently ended on or prior to such date divided by
(ii) the aggregate gross sales of the Parent Borrower and such Domestic
Subsidiary Loan Parties for such twelve fiscal month period, or (y) with
respect to the Canadian Borrowing Base, (i) the aggregate amount of the
Dilution Factors in respect of the Accounts of the Canadian Subsidiary Borrower
and the wholly-owned Canadian 

 

13

 

Subsidiary Loan Parties for the twelve fiscal
month period most recently ended on or prior to such date divided by (ii) the
aggregate gross sales of the Canadian Subsidiary Borrower and such Canadian
Subsidiary Loan Parties for such twelve fiscal month period.

 

“Dilution
Reserve” means, on any date, (x) with respect to the Domestic
Borrowing Base, the product of (i) the excess, if any, of the applicable
Dilution Ratio over 5% multiplied by (ii) the aggregate amount of
Eligible Accounts of the Parent Borrower and the wholly-owned Domestic
Subsidiary Loan Parties, in each case as of such date, or (y) with respect
to the Canadian Borrowing Base, the product of (i) the excess, if any, of
the applicable Dilution Ratio over 5% multiplied by (ii) the
aggregate amount of Eligible Accounts of the Canadian Subsidiary Borrower and
the wholly-owned Canadian Subsidiary Loan Parties, in each case as of such
date.

 

“Discharge
of Revolving Lender Claims” means payment in full in cash of (a) all
principal, interest (including interest accruing during the pendency of any
Insolvency or Liquidation Proceeding, regardless of whether or not allowed in
such Insolvency or Liquidation Proceeding) and other Secured Revolving
Obligations under this Agreement (or, with respect to Letters of Credit
outstanding hereunder, either termination thereof or delivery of cash
collateral in respect thereof on terms substantially similar to those in Section 2.05(j) of
this Agreement (or, in lieu of such cash collateral, enter into a backstop
letter of credit in favor of the Administrative Agent, in form reasonably
satisfactory to the Administrative Agent, in an amount equal to 105% of the
face amount of such Letters of Credit)), in each case after or concurrently
with the termination or expiration of all Revolving Commitments hereunder
(other than any commitment to satisfy drawings under any outstanding Letter of
Credit in accordance with the terms hereof), and (b) all other Secured
Revolving Obligations that are due and payable or otherwise accrued and owing
at or prior to the time such principal and interest are paid, in each case,
other than contingent indemnities and costs and reimbursement obligations to
the extent no claim has been made.

 

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

 

“Discount
B/A Rate” means, with respect to a B/A being accepted and purchased on any
day, (a) for a Lender that is a Schedule I Lender, the CDOR Rate
applicable to such B/A and (b) for a Lender that is a Schedule II Lender
or a Schedule III Lender, the lesser of (i) the CDOR Rate applicable to
such B/A plus 0.10% per annum and (ii) the arithmetic average (as
determined by the Administrative Agent) of the percentage discount rates
(expressed as a decimal and rounded upward, if necessary, to the nearest 1/100
of 1%) quoted to the Administrative Agent by the Schedule II Reference Lender
as the percentage discount rate at which the Schedule II Reference Lender
would, in accordance with its normal practices, at approximately 10:00 a.m.,
Toronto time, on such day, be prepared to purchase bankers’ acceptances
accepted by such bank having a face amount and term comparable to the face
amount and Contract Period of such B/A.

 

“Discount
Proceeds” means, with respect to any B/A, an amount (rounded upward, if
necessary, to the nearest C$.01) calculated by multiplying (a) the face
amount of such B/A by (b) the quotient obtained by dividing (i) one
by (ii) the sum of (A) one and (B) the product of (x) the
Discount B/A Rate (expressed as a decimal) applicable to such B/A and (y) a
fraction of which the numerator is the Contract Period applicable to such B/A
and the denominator is 365, with such quotient being rounded upward or downward
to the fifth decimal place and .000005 being rounded upward.

 

“Disqualified
Equity Interests” means Equity Interests that (a) require the payment
of any dividends (other than dividends payable solely in shares of Qualified
Equity Interests), (b) mature or are mandatorily redeemable or subject to
mandatory repurchase or redemption or repurchase at the option of 

 

14

 

the holders thereof, in each case in whole or
in part and whether upon the occurrence of any event, pursuant to a sinking
fund obligation on a fixed date or otherwise, prior to the date that is
180 days after the Maturity Date (other than (i) upon payment in full
of the Obligations (other than Unliquidated Obligations), reduction of the
Total L/C Exposure to zero (or cash collateralization or other support of all
outstanding Letters of Credit in a manner reasonably acceptable to the Issuing
Bank) and termination of the Commitments or (ii) upon a “change in control”
or the sale of all or substantially all the assets of the issuing entity, provided
that any payment required pursuant to this clause (ii) is
contractually subordinated in right of payment to the Obligations on terms
reasonably satisfactory to the Administrative Agent and such requirement is
applicable only in circumstances that are market on the date of issuance of
such Equity Interests), (c) require the maintenance or achievement of any
financial performance standards other than as a condition to the taking of
specific actions or provide remedies to holders thereof (other than voting and
management rights and increases in pay-in-kind dividends) or (d) are
convertible or exchangeable, automatically or at the option of any holder
thereof, into any Indebtedness, Equity Interests or other assets other than
Qualified Equity Interests.

 

“Document”
has the meaning assigned to such term in the Security Agreements.

 

“Domestic
Applicable Percentage” has the meaning assigned to such term in Section 10.10(a).

 

“Domestic
Borrowing Base” means, at any time, the sum of (a) 85% of the U.S.
Dollar Equivalent of the aggregate Adjusted Eligible Accounts of the Parent
Borrower and the wholly-owned Domestic Subsidiary Loan Parties at such time, plus
(b) the lesser of (i) 85% of the product of (x) the Net Recovery
Liquidation Rate in effect (based on the then most recent independent Inventory
appraisal in form, scope and substance reasonably satisfactory to the
Administrative Agent) at such time multiplied by (y) the aggregate
amount of Inventory of the Parent Borrower and the wholly-owned Domestic
Subsidiary Loan Parties at such time (as reported in accordance with the
applicable Loan Party’s Inventory records), and (ii) the sum of (A) 75%
of the aggregate cost of Eligible Aluminum Billets and (B) 65% of the
aggregate cost of Other Eligible Inventory, in each case of the Parent Borrower
and the wholly-owned Domestic Subsidiary Loan Parties at such time (in the case
of each of subclauses (i) and (ii) of this clause (b), with any
Inventory, Eligible Inventory, Eligible Aluminum Billets and Other Eligible
Inventory to be valued on a first-in, first-out basis), provided that
the aggregate amount determined pursuant to this clause (b) shall not
constitute more than 50% of the Domestic Borrowing Base at such time, plus (c) the PP&E Component at such
time minus (d) Reserves with respect to the Parent Borrower and the
wholly-owned Domestic Subsidiary Loan Parties at such time.  The Administrative Agent may, in its
Permitted Discretion, from time to time, reduce the advance rates set forth
above or establish and revise ineligibles and Reserves reducing the amount of
Eligible Accounts, Inventory, Eligible Inventory, Eligible Aluminum Billets,
Other Eligible Inventory, Eligible Machinery and Equipment and Eligible Real
Property used in computing the Domestic Borrowing Base, with any such changes
to be effective five Business Days after delivery of notice thereof to the
Parent Borrower and the Lenders (which notice shall describe in reasonable
detail the reasons for such changes), provided that any Reserve
established by the Administrative Agent shall not apply in respect of items
excluded from Eligible Accounts, Eligible Inventory, Eligible Aluminum Billets,
Other Eligible Inventory, Eligible Machinery and Equipment and Eligible Real
Property pursuant to the definitions thereof or covered by any other Reserve in
effect at the time such Reserve is established. 
The Domestic Borrowing Base at any time shall be determined by reference
to the most recent Borrowing Base Certificate delivered to the Administrative
Agent pursuant to Section 5.01(f) of this Agreement.

 

“Domestic
Perfection Certificate” means, at any time, the certificate most-recently
delivered to the Administrative Agent (a) in the case of the Restatement
Effective Date, pursuant to Section 4.01(f) or (b) thereafter,
pursuant to Section 3.03(c) of the Domestic Security Agreement, in
each 

 

15

 

case in the form of Exhibit F-1
or any other form approved by the Administrative Agent.

 

“Domestic
Security Agreement” means the Domestic Security Agreement dated as of February 2,
2006, as amended and restated as of the date hereof (as further amended,
amended and restated, supplemented or modified from time to time in accordance
with this Agreement), among Holdings, the Parent Borrower, each Domestic
Subsidiary Loan Party and the Administrative Agent, substantially in the form
attached hereto as Exhibit G-1.

 

“Domestic
Subsidiary” means any Subsidiary that is organized under the laws of the
United States of America, any State thereof or the District of Columbia.

 

“Domestic
Subsidiary Loan Party” means any Domestic Subsidiary.

 

“Effective
Date” means February 2, 2006.

 

“Eligible
Accounts” means, at any time, the Accounts of (x) the Parent Borrower
and the wholly-owned Domestic Subsidiary Loan Parties at such time, in the case
of the Domestic Borrowing Base, or (y) the Canadian Subsidiary Borrower
and the wholly-owned Canadian Subsidiary Loan Parties at such time, in the case
of the Canadian Borrowing Base, but excluding any Account:

 

(a) that
is not subject to a first priority perfected security interest in favor of the
Administrative Agent or to which the applicable Loan Party does not have sole
lawful and absolute title;

 

(b) that
is subject to any Lien other than (i) a Lien in favor of the
Administrative Agent and (ii) a Permitted Encumbrance that does not have
priority over the Lien in favor of the Administrative Agent;

 

(c) with
respect to which the scheduled due date is more than 90 days after the original
invoice date, that is unpaid more than 120 days after the date of the original
invoice therefor or more than 60 days after the original due date, or that has
been written off the books of the Parent Borrower or the applicable Domestic
Subsidiary Loan Party, in the case of the Domestic Borrowing Base, or the
Canadian Subsidiary Borrower or the applicable Canadian Subsidiary Loan Party,
in the case of the Canadian Borrowing Base, or otherwise designated as
uncollectible;

 

(d) that
is owing by an Account Debtor for which more than 50% of the aggregate amount
of Accounts owing from such Account Debtor and its Affiliates are ineligible
hereunder;

 

(e) that
is owing by an Account Debtor to the extent the aggregate amount of Accounts
owing from such Account Debtor and its Affiliates to (i) the Parent
Borrower or any wholly-owned Domestic Subsidiary Loan Party, in the case of the
Domestic Borrowing Base, exceeds 10% (or, in the case of Utility Trailer
Manufacturing Co. or Eastern Metal Supply, 15%) of the aggregate Eligible
Accounts attributable to the Domestic Borrowing Base, and (ii) the
Canadian Subsidiary Borrower or any wholly-owned Canadian Subsidiary Loan
Party, in the case of the Canadian Borrowing Base, exceeds 10% (or, in the case
of Utility Trailer Manufacturing Co. or Eastern Metal Supply, 15%) of the
aggregate Eligible Accounts attributable to the Canadian Borrowing Base;

 

(f) with
respect to which any covenant, representation or warranty contained in any Loan
Document has been breached or is not true;

 

16

 

(g) that (i) does
not arise from the sale of goods or performance of services in the ordinary
course of business, (ii) is not evidenced by an invoice or other
documentation reasonably satisfactory to the Administrative Agent that has been
sent to the Account Debtor, (iii) represents a progress billing, (iv) is
contingent upon (A) the Parent Borrower or any Domestic Subsidiary Loan
Party’s, in the case of the Domestic Borrowing Base, or (B) the Canadian
Subsidiary Borrower or any Canadian Subsidiary Loan Party’s, in the case of the
Canadian Borrowing Base, completion of any further performance, (v) represents
a sale on a bill-and-hold, guaranteed sale, sale-and-return, sale on approval,
consignment, cash-on-delivery or any other repurchase or return basis (other
than customary customer return rights) or (vi) relates to payments of
interest;

 

(h) (i) for
which the goods giving rise to such Account have not been shipped to the
Account Debtor or its designee, (ii) for which the services giving rise to
such Account have not been performed by (A) the Parent Borrower or the
applicable Domestic Subsidiary Loan Party, in the case of the Domestic
Borrowing Base, or (B) the Canadian Subsidiary Borrower or the applicable
Canadian Subsidiary Loan Party, in the case of the Canadian Borrowing Base, (iii) for
which the associated income has not been earned or (iv) if such Account
was invoiced more than once;

 

(i) that
is owed by an Account Debtor that has (i) applied for, suffered or
consented to the appointment of any receiver, interim receiver, receiver
manager, custodian, trustee, or liquidator of its assets, (ii) has had
possession of all or a material part of its property taken by any receiver,
interim receiver, receiver manager, custodian, trustee or liquidator, (iii) filed,
or had filed against it, any request or petition for liquidation,
reorganization, arrangement, adjustment of debts, adjudication as bankrupt,
winding-up or voluntary or involuntary case under any federal, state,
provincial or foreign bankruptcy or insolvency laws, (iv) has admitted in
writing its inability, or is generally unable to, pay its debts as they become
due, (v) become insolvent or (vi) ceased operation of its business;

 

(j) that
is owed by an Account Debtor that (i) does not maintain its chief
executive office in the United States of America, any State thereof or the
District of Columbia or Canada or any province thereof, or (ii) is not
organized under applicable law of the United States of America or any state
thereof or Canada or any province thereof, in each case, unless such Account
(or portion thereof that is reasonably acceptable to the Administrative Agent)
is backed by a letter of credit, guarantee or eligible bankers’ acceptance
acceptable to the Administrative Agent and in which the Administrative Agent
has a perfected security interest;

 

(k) that
is owed in any currency other than U.S. Dollars or Canadian Dollars;

 

(l) that
is owed by (i) the government (or any department, agency, public
corporation or instrumentality thereof) of any country other than (A) the
United States of America, in the case of the Domestic Borrowing Base, or (B) the
United States of America or Canada, in the case of the Canadian Borrowing Base,
in each case, unless such Account (or portion thereof that is reasonably
acceptable to the Administrative Agent) is backed by a letter of credit,
guarantee or eligible bankers’ acceptance acceptable to the Administrative
Agent and in which the Administrative Agent has a perfected security interest, (ii) the
government of the United States of America, or any department, agency, public
corporation or instrumentality thereof, unless the Federal Assignment of Claims
Act of 1940, as amended (31 U.S.C. §§ 3727 et seq. and 41 U.S.C. §§ 15 et
seq.), and any other steps necessary to perfect the Lien of the Administrative
Agent in such Account have been complied with to the Administrative Agent’s
reasonable satisfaction, or (iii) in the case of the Canadian Borrowing
Base, the government of Canada, or any department, agency, public corporation
or instrumentality thereof, unless the Financial Administration Act 

 

17

 

(Canada), as amended, and any other steps
necessary to perfect the Lien of the Administrative Agent in such Account have
been complied with to the Administrative Agent’s reasonable satisfaction;

 

(m) that
is owed by any Affiliate (other than any portfolio company directly or
indirectly owned by the Sponsor so long as such Account has terms comparable to
those provided to third parties on an arms length basis), employee, officer,
director, agent or stockholder of any Loan Party;

 

(n) that,
for any Account Debtor, exceeds a credit limit determined by the Administrative
Agent in its Permitted Discretion, to the extent of such excess;

 

(o) that
is owed by an Account Debtor or any Affiliate of such Account Debtor to which (i) the
Parent Borrower or any Domestic Subsidiary Loan Party, in the case of the
Domestic Borrowing Base, or (ii) the Canadian Subsidiary Borrower or any
Canadian Subsidiary Loan Party, in the case of the Canadian Borrowing Base, is
indebted, but only to the extent of such indebtedness, or is subject to any
security, deposit, progress payment, retainage or other similar advance made by
or for the benefit of an Account Debtor, in each case to the extent thereof;

 

(p) that
is subject to any counterclaim, deduction, defense, setoff or dispute (but only
to the extent of any such counterclaim, deduction, defense, setoff or dispute)
or is subject to offset related to actual or anticipated sales volume rebates
(but only to the extent of any such rebate);

 

(q) that
is owed by an Account Debtor located in any jurisdiction that requires filing
of a “Notice of Business Activities Report” or other similar report in order to
permit (i) the Parent Borrower or the applicable Domestic Subsidiary Loan
Party, in the case of the Domestic Borrowing Base, or (ii) the Canadian
Subsidiary Borrower or the applicable Canadian Subsidiary Loan Party, in the
case of the Canadian Borrowing Base, to seek judicial enforcement in such
jurisdiction of payment of such Account, unless the Parent Borrower, such
Domestic Subsidiary Loan Party, the Canadian Subsidiary Borrower or such
Canadian Subsidiary Loan Party, as applicable, has filed such report or
qualified to do business in such jurisdiction, unless such failure to file may
be cured by the payment of a de minimis amount;

 

(r) with
respect to which (i) the Parent Borrower or any Domestic Subsidiary Loan
Party, in the case of the Domestic Borrowing Base, or (ii) the Canadian
Subsidiary Borrower or any Canadian Subsidiary Loan Party, in the case of the
Canadian Borrowing Base, has made any agreement with the Account Debtor for any
reduction thereof, other than discounts and adjustments given in the ordinary
course of business, or any Account that was partially paid and the Parent
Borrower, such Domestic Subsidiary Loan Party, the Canadian Subsidiary Borrower
or such Canadian Subsidiary Loan Party, as applicable, created a new receivable
for the unpaid portion of such Account;

 

(s) that
does not comply in all material respects with the requirements of all
applicable laws and regulations, whether federal, state, provincial or local,
including, where applicable, the Federal Consumer Credit Protection Act, the
Federal Truth in Lending Act and Regulation Z of the Board;

 

(t) that
is for goods that have been sold under a purchase order or pursuant to the
terms of a contract or other agreement or understanding (written or oral) that
indicates or purports that any Person other than (i) the Parent Borrower
or the applicable Domestic Subsidiary Loan Party, in the case of the Domestic
Borrowing Base, or (ii) the Canadian Subsidiary Borrower or the 

 

18

 

applicable Canadian Subsidiary Loan Party, in
the case of the Canadian Borrowing Base, has or has had an ownership interest
in such goods, or that indicates any party other than (A) the Parent
Borrower or the applicable Domestic Subsidiary Loan Party, in the case of the
Domestic Borrowing Base, or (B) the Canadian Subsidiary Borrower or the
applicable Canadian Subsidiary Loan Party, in the case of the Canadian
Borrowing Base, as payee or remittance party (it being understood and agreed
that the transfer of a purchase order from the Parent Borrower or any Domestic
Subsidiary Loan Party to the Canadian Subsidiary Borrower or any Canadian
Subsidiary Loan Party, or from the Canadian Subsidiary Borrower or any Canadian
Subsidiary Loan Party to the Parent Borrower or any Domestic Subsidiary Loan Party,
as the case may be, for capacity or other ordinary course business reasons
shall not, in itself, result in the Account created in respect of such purchase
order being deemed ineligible pursuant to this clause (t) for purposes of (1) the
Domestic Borrowing Base, if the transferee is the Parent Borrower or any
Domestic Subsidiary Loan Party, or (2) the Canadian Borrowing Base, if the
transferee is the Canadian Subsidiary Borrower or any Canadian Subsidiary Loan
Party);

 

(u) that
was created on cash on delivery terms;

 

(v) that
arises from sales to third party processors to the extent that the underlying
inventory will be returned to the applicable Loan Party;

 

(w) that
the Administrative Agent determines in its Permitted Discretion may not be paid
by reason of the Account Debtor’s inability to pay; or

 

(x) that
is deemed ineligible by the Administrative Agent in its Permitted Discretion.

 

In addition to the foregoing,
Eligible Accounts shall not include any portion of Accounts related to
unreconciled variances between the accounts receivable aging and the general
ledger to the extent that the general ledger is less than the accounts
receivable aging.  In determining the
amount of an Eligible Account, the face amount of an Account shall be reduced
by, without duplication, to the extent not reflected in such face amount, (i) the
amount of all accrued and actual discounts, claims, credits or credits pending,
promotional program allowances, price adjustments, finance charges or other
allowances (including any amount that (A) the Parent Borrower or the
applicable Domestic Subsidiary Loan Party, in the case of the Domestic
Borrowing Base, or (B) the Canadian Subsidiary Borrower or the applicable
Canadian Subsidiary Loan Party, in the case of the Canadian Borrowing Base, may
be obligated to rebate to an Account Debtor pursuant to the terms of any
agreement or understanding (written or oral)) and (ii) the aggregate
amount of all cash received in respect of such Account but not yet applied by (A) the
Parent Borrower or the applicable Domestic Subsidiary Loan Party, in the case
of the Domestic Borrowing Base, or (B) the Canadian Subsidiary Borrower or
the applicable Canadian Subsidiary Loan Party, in the case of the Canadian
Borrowing Base, to reduce the amount of such Account.  In determining the aggregate amount from the
same Account Debtor that is unpaid more than 120 days from the original
invoice date or more than 60 days from the original due date pursuant to clause
(c) above, there shall be excluded the amount of any net credit balances
relating to Accounts due from such Account Debtor with invoice dates more than
120 days from the original invoice date or more than 60 days from the
original due date, as the case may be.

 

“Eligible
Aluminum Billets” means, at any time, the portion of Eligible Inventory of (x) the
Parent Borrower and the wholly-owned Domestic Subsidiary Loan Parties at such
time, in the case of the Domestic Borrowing Base, or (y) the Canadian
Subsidiary Borrower and the wholly-owned Canadian Subsidiary Loan Parties at
such time, in the case of the Canadian Borrowing Base, in each case that is
comprised of aluminum billets and logs as shown on the applicable Loan Party’s
Inventory records in accordance with such Loan Party’s current and historical
accounting practices.

 

19

 

“Eligible
Inventory” means, at any time, the Inventory of (x) the Parent
Borrower and the wholly-owned Domestic Subsidiary Loan Parties at such time, in
the case of the Domestic Borrowing Base, or (y) the Canadian Subsidiary
Borrower and the wholly-owned Canadian Subsidiary Loan Parties at such time, in
the case of the Canadian Borrowing Base, but excluding any Inventory:

 

(a) that
is not subject to a first priority perfected Lien in favor of the
Administrative Agent, except to the extent that this clause (a) would
exclude any Inventory that is otherwise expressly included pursuant to this
definition;

 

(b) that
is subject to any Lien other than (i) a Lien in favor of the
Administrative Agent and (ii) a Permitted Encumbrance that does not have
priority over the Lien in favor of the Administrative Agent, except to the
extent that this clause (b) would exclude any Inventory that is otherwise
expressly included pursuant to this definition;

 

(c) that
is, in the Administrative Agent’s reasonable opinion, seconds or thirds, stale,
slow-moving, obsolete, unmerchantable, defective, used, unfit for sale, not
salable in the ordinary course of business at prices approximating at least the
cost of such Inventory, or unacceptable due to age, type, category and/or
quantity, or that is identified by the applicable Loan Party as overstock or
excess;

 

(d) with
respect to which any covenant, representation or warranty contained in any Loan
Document has been breached or is not true and that does not conform to all
standards imposed by any Governmental Authority;

 

(e) in
which any Person other than (i) the Parent Borrower and the wholly-owned
Domestic Subsidiary Loan Parties, in the case of the Domestic Borrowing Base,
and (ii) the Canadian Subsidiary Borrower and the wholly-owned Canadian
Subsidiary Loan Parties, in the case of the Canadian Borrowing Base, shall (A) have
any direct or indirect ownership, interest or title to such Inventory, except
for any interest (and any rights associated therewith, other than title) of
such Person that arises in respect of Inventory (1) (x) as identified
goods pursuant to Section 2-501 of the Uniform Commercial Code or (y) pursuant
to Section 2-716 of the Uniform Commercial Code or (2) pursuant to
any similar Canadian law or laws or (B) be indicated on any purchase order
or invoice with respect to such Inventory as having or purporting to have an
interest therein;

 

(f) that
constitutes spare or replacement parts, subassemblies, packaging and shipping
material, manufacturing supplies, samples, prototypes, displays or display
items, bill-and-hold goods, goods that are returned or marked for return,
repossessed goods, defective, damaged or rejected goods, goods held by any Loan
Party on consignment, or goods that are not of a type held for sale in the
ordinary course of business;

 

(g) that (i) is
not located in the United States of America (in the case of the Domestic
Borrowing Base) or Canada (in the case of the Canadian Borrowing Base) or (ii) is
in transit with a common carrier from vendors and suppliers (as opposed to in
transit with a common carrier between locations of Loan Parties, in which case
such Inventory shall not be excluded by virtue thereof) or (iii) is being
held by a Governmental Authority for purposes of customs clearance, except that
any Inventory excluded pursuant to subclause (ii) or (iii) of this
clause (g) having an aggregate Inventory Value not to exceed $15,000,000
at any time may qualify as Eligible Inventory if (A) the applicable Loan
Party has title to such Inventory at such time and (B) such Inventory is
insured in a manner that is reasonably satisfactory to the Administrative Agent;

 

20

 

(h) that
is located in any location leased by (i) the Parent Borrower or any
wholly-owned Domestic Subsidiary Loan Party, in the case of the Domestic
Borrowing Base, or (ii) the Canadian Subsidiary Borrower or any
wholly-owned Canadian Subsidiary Loan Party, in the case of the Canadian
Borrowing Base, in each case, unless (A) the
lessor has delivered to the Administrative Agent a Collateral Access Agreement
or (B) a Reserve for up to three months’ rent, charges and other amounts
due or to become due with respect to such facility has been established by the
Administrative Agent in its Permitted Discretion;

 

(i) that is located in any third party warehouse or is in the
possession of a bailee (other than a third party processor) and is not
evidenced by a Document, unless (i) such warehouseman or bailee has
delivered to the Administrative Agent a Collateral Access Agreement and such
other documentation as the Administrative Agent may require or (ii) a
Reserve has been established by the Administrative Agent in its Permitted
Discretion;

 

(j) that
is being processed offsite at a third party location or outside processor
(unless the Administrative Agent has (i) received a Collateral Access
Agreement from such location or processor with respect to such Inventory or (ii) a
Reserve has been established by the Administrative Agent in respect of such
Inventory), or is in-transit to or from said third party location or outside
processor;

 

(k) that
is a discontinued product or component thereof;

 

(l) that
is the subject of a consignment by (i) the Parent Borrower or any Domestic
Subsidiary Loan Party, in the case of the Domestic Borrowing Base, or (ii) the
Canadian Subsidiary Borrower or any Canadian Subsidiary Loan Party, in the case
of the Canadian Borrowing Base, as consignor;

 

(m) that
contains or bears any intellectual property rights licensed to (i) the Parent
Borrower or any Domestic Subsidiary Loan Party, in the case of the Domestic
Borrowing Base, or (ii) the Canadian Subsidiary Borrower or any Canadian
Subsidiary Loan Party, in the case of the Canadian Borrowing Base, in each
case, unless the Administrative Agent is satisfied that it may sell or
otherwise dispose of such Inventory without (A) infringing the rights of
such licensor, (B) materially violating any contract with such licensor or
(C) incurring any liability with respect to payment of royalties other
than royalties incurred pursuant to sale of such Inventory under the current
licensing agreement;

 

(n) that
is not reflected in the current inventory records of (i) the Parent
Borrower or any wholly-owned Domestic Subsidiary Loan Party, in the case of the
Domestic Borrowing Base, or (ii) the Canadian Subsidiary Borrower or any
wholly-owned Canadian Subsidiary Loan Party, in the case of the Canadian
Borrowing Base;

 

(o) any
portion of the Inventory Value that is attributable to intercompany profit among
the applicable Loan Party or its Affiliates; or

 

(p) that
is deemed ineligible by the Administrative Agent in its Permitted Discretion.

 

“Eligible
Machinery and Equipment” means the equipment listed on Schedule 1.01
and any additional equipment acquired after the Effective Date, in each case
that is owned by (x) the Parent Borrower or any wholly-owned Domestic
Subsidiary Loan Party, in the case of the Domestic Borrowing Base, or (y) the
Canadian Subsidiary Borrower or any wholly-owned Canadian Subsidiary Loan
Party, in the case of the Canadian Borrowing Base, in each case (i) that
is acceptable in the Permitted Discretion of 

 

21

 

the Administrative Agent for inclusion in the
applicable Borrowing Base, (ii) in respect of which an appraisal report
has been delivered to the Administrative Agent in form, scope and substance
reasonably satisfactory to the Administrative Agent and (iii) in respect
of which the Administrative Agent is satisfied that all actions necessary in
order to create valid first priority Liens on such equipment have been taken,
and, in each case, meeting each of the following requirements:

 

(a) (i) the
Parent Borrower or the applicable Domestic Subsidiary Loan Party, in the case
of the Domestic Borrowing Base, or (ii) the Canadian Subsidiary Borrower
or the applicable Canadian Subsidiary Loan Party, in the case of the Canadian
Borrowing Base, in each case has good title to such equipment and solely to the
extent that no other Person has any direct or indirect ownership, interest or
title;

 

(b) (i) the
Parent Borrower or the applicable Domestic Subsidiary Loan Party, in the case
of the Domestic Borrowing Base, or (ii) the Canadian Subsidiary Borrower
or the applicable Canadian Subsidiary Loan Party, in the case of the Canadian
Borrowing Base, has the right to subject such equipment to a Lien in favor of
the Administrative Agent; and such equipment is subject to a first priority
perfected Lien in favor of the Administrative Agent and is free and clear of
all other Liens of any nature whatsoever (except for Permitted Encumbrances
that do not have priority over the Lien in favor of the Administrative Agent);

 

(c) the
full purchase price for such equipment has been paid by (i) the Parent
Borrower or the applicable Domestic Subsidiary Loan Party, in the case of the
Domestic Borrowing Base, or (ii) the Canadian Subsidiary Borrower or the
applicable Canadian Subsidiary Loan Party, in the case of the Canadian
Borrowing Base;

 

(d) such
equipment is located on premises (i) owned by (A) the Parent Borrower
or the applicable Domestic Subsidiary Loan Party, in the case of the Domestic
Borrowing Base, or (B) the Canadian Subsidiary Borrower or the applicable
Canadian Subsidiary Loan Party, in the case of the Canadian Borrowing Base,
and, in each case, subject to a first priority perfected Lien in favor of the
Administrative Agent, or (ii) leased by (A) the Parent Borrower or
the applicable Domestic Subsidiary Loan Party, in the case of the Domestic
Borrowing Base, or (B) the Canadian Subsidiary Borrower or the applicable
Canadian Subsidiary Loan Party, in the case of the Canadian Borrowing Base, in
each case, where (x) the lessor has delivered to the Administrative Agent
a Collateral Access Agreement or (y) a Reserve for up to three months’
rent, charges and other amounts due or to become due with respect to such
facility has been established by the Administrative Agent in its Permitted
Discretion;

 

(e) such
equipment is in good working order and condition (ordinary wear and tear
excepted);

 

(f) such
equipment is not subject to any agreement (other than the Loan Documents and
the Senior Secured Notes Documents) that restricts the ability of (i) the
Parent Borrower or the applicable Domestic Subsidiary Loan Party, in the case
of the Domestic Borrowing Base, or (ii) the Canadian Subsidiary Borrower
or the applicable Canadian Subsidiary Loan Party, in the case of the Canadian
Borrowing Base, to use, sell, transport or dispose of such equipment or that
restricts the Administrative Agent’s ability to take possession of, sell or
otherwise dispose of such equipment; and

 

(g) such
equipment does not constitute “fixtures” under the applicable laws of the
jurisdiction in which such equipment is located (unless the Administrative
Agent is satisfied that all actions necessary to create a perfected first
priority Lien (subject to the Liens described in 

 

22

 

clauses (a) and (b) (to the extent that (i) the
applicable warehouseman, bailee or other Person described in clause (b) of
the definition of “Permitted Encumbrance” has delivered to the Administrative
Agent a Collateral Access Agreement or (ii) a Reserve has been established
by the Administrative Agent in respect of such equipment) of the definition of “Permitted
Encumbrances”) in favor of the Administrative Agent on such fixtures have been
taken).

 

“Eligible Real Property” means the real property
listed on Schedule 1.02 owned by (x) the Parent Borrower or any
wholly-owned Domestic Subsidiary Loan Party, in the case of the Domestic
Borrowing Base, or (y) the Canadian Subsidiary Borrower or any
wholly-owned Canadian Subsidiary Loan Party, in the case of the Canadian
Borrowing Base, and meeting each of the following requirements:

 

(a) in
respect of which an appraisal report has been delivered to the Administrative
Agent in form, scope and substance reasonably satisfactory to the
Administrative Agent;

 

(b) in
respect of which the Administrative Agent is satisfied that all actions
necessary in order to create a perfected first priority Lien (subject to Liens
described in clauses (a), (b) and (f) of the definition of “Permitted
Encumbrances”) in favor of the Administrative Agent on such real property have
been taken, including the filing, registration and recording of the applicable
Mortgage (or the delivery of the applicable Mortgage to the title insurance
company for filing, registration or recording);

 

(c) that
is adequately protected by valid title insurance with endorsements and in amounts
reasonably acceptable to the Administrative Agent, insuring that the
Administrative Agent, for the benefit of the Lenders, shall have a perfected
first priority Lien (subject to Liens described in clauses (a), (b) and (f) of
the definition of “Permitted Encumbrances”) on such real property, evidence of
which shall have been provided in form and substance reasonably satisfactory to
the Administrative Agent; and

 

(d) if
reasonably required by the Administrative Agent, (i) an ALTA survey (or
equivalent Canadian or other non-U.S. survey, as applicable) has been delivered
for which all necessary fees have been paid and which is dated no more than 30
days prior to the date on which the applicable Mortgage is registered or
recorded, certified to the Administrative Agent and the issuer of the title
insurance policy in a manner reasonably satisfactory to the Administrative
Agent by a land surveyor duly registered and licensed in the state or province
in which such Eligible Real Property is located and reasonably acceptable to
the Administrative Agent, and shows all buildings and other improvements, any
material offsite improvements, the location of any easements, parking spaces,
rights of way, building setback lines and other dimensional regulations and the
absence of encroachments, either by such improvements or on to such property,
and other defects, other than encroachments and other defects reasonably
acceptable to the Administrative Agent, (ii) in respect of which local
counsel for the applicable Loan Party in the state or province in which such
Eligible Real Property is located has delivered a letter of opinion with
respect to the enforceability and perfection of the applicable Mortgage and any
related fixture filings in form and substance reasonably satisfactory to the
Administrative Agent, and (iii) in respect of which (A) the Parent
Borrower or the applicable Domestic Subsidiary Loan Party, in the case of the
Domestic Borrowing Base, or (B) the Canadian Subsidiary Borrower or the
applicable Canadian Subsidiary Loan Party, in the case of the Canadian
Borrowing Base, shall have used its commercially reasonable efforts to obtain
estoppel certificates executed by all tenants of such Eligible Real Property
and such other consents, agreements and confirmations of lessors and third
parties have been delivered as the Administrative Agent may deem necessary or
desirable, together with evidence that all other actions that the
Administrative Agent may deem 

 

23

 

necessary or desirable in order to create perfected first priority
Liens on the property described in the applicable Mortgage have been taken.

 

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

 

“Environmental
Liability” means any liability, obligation, claim, action, suit, judgment
or order under or relating to any Environmental Law for any damages, injunctive
relief, losses, fines, penalties, fees, expenses (including reasonable fees and
expenses of attorneys and consultants) or costs, whether contingent or
otherwise, including those arising from or relating to (a) any actual or
alleged violation of any Environmental Law or permit, license or approval
issued thereunder, (b) the generation, use, handling, transportation,
storage, treatment or disposal of any Hazardous Materials, (c) exposure to
any Hazardous Materials, (d) the Release of any Hazardous Materials or the
presence of any Hazardous Materials in, on or under any real property or (e) any
contract, agreement or other consensual arrangement pursuant to which liability
is assumed or imposed with respect to any of the foregoing.

 

“Equity
Contributions” means, collectively, (a) the contribution by the
Permitted Holders (or the making of the Co-Investor Fronting Loans in lieu of
such contribution) on the Effective Date of an aggregate amount not less than
$111,250,000 in cash to Holdings as common equity and (b) the further
contribution by Holdings on the Effective Date of all such cash contribution
proceeds to the Parent Borrower as common equity, the proceeds of which were
used to consummate the Acquisition and pay fees and expenses related to the
Original Transactions.

 

“Equity
Interests” means shares of capital stock, partnership interests, membership
interests in a limited liability company, beneficial interests in a trust or
other equity ownership interests in a Person, and any warrants, options or
other rights entitling the holder thereof to purchase or acquire any such
equity interest.

 

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

 

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

 

“ERISA
Event” means (a) any “reportable event”, as defined in Section 4043
of ERISA or the regulations issued thereunder with respect to a Plan (other
than an event for which the 30-day notice period is waived), (b) any
failure by any Plan to satisfy the minimum funding standard (within the meaning
of Section 412 of the Code or Section 302 of ERISA) applicable to
such Plan whether or not waived, (c) the filing pursuant to Section 412(c) of
the Code or Section 302(d) of ERISA of an application for a waiver of
the minimum funding standard with respect to any Plan, (d) the incurrence
by the Parent Borrower or any of its ERISA Affiliates of any liability under
Title IV of ERISA with respect to the termination of any Plan, (e) the
receipt by the Parent Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan, (f) the incurrence
by the Parent Borrower or any of its ERISA Affiliates of any liability with
respect to the withdrawal or partial withdrawal from any Plan or Multiemployer
Plan, (g) the receipt by the Parent Borrower or any ERISA Affiliate of any
notice, or the 

 

24

 

receipt by any Multiemployer Plan from the
Parent Borrower or any ERISA Affiliate of any notice, concerning the imposition
of Withdrawal Liability or a determination that a Multiemployer Plan is, or is
expected to be, insolvent or in reorganization, within the meaning of Title IV
of ERISA, (h) a determination that any Plan is, or is expected to be, in “at-risk”
status (as defined in Section 303(i)(4) of ERISA or Section 430(i)(4) of
the Code) or (i) any other event or condition with respect to a Plan or
Multiemployer Plan that could result in material liability of the Parent
Borrower or any Subsidiary.

 

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

 

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

 

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

 

“Exchange
Rate” means, on any day, for purposes of determining the U.S. Dollar
Equivalent of Canadian Dollars, the rate at which Canadian Dollars may be
exchanged into U.S. Dollars at the time of determination on such day on the
Reuters WRLD Page for Canadian Dollars. 
In the event that such rate does not appear on any Reuters WRLD Page,
the Exchange Rate shall be determined by reference to such other publicly
available service for displaying exchange rates as may be agreed upon by the
Administrative Agent and the Parent Borrower, or, in the absence of such an
agreement, such Exchange Rate shall instead be the arithmetic average of the
spot rates of exchange of the Administrative Agent in the market where its
foreign currency exchange operations in respect of Canadian Dollars are then
being conducted, at or about such time as the Administrative Agent shall elect
after determining that such rates shall be the basis for determining the
Exchange Rate, on such date for the purchase of U.S. Dollars for delivery two
Business Days later, provided that if at the time of any such determination,
for any reason, no such spot rate is being quoted, the Administrative Agent may
use any reasonable method it deems appropriate to determine such rate, and such
determination shall be conclusive absent manifest error.

 

“Excluded
Amounts” has the meaning assigned to such term in Section 6.06.

 

“Excluded
Mortgages” means the Mortgages set forth on Schedule 4.01(i).

 

“Excluded
Proceeds” means 100% of the Net Proceeds (or, in the case of clause (c) of
this definition, 50% of the Net Proceeds) received by the Parent Borrower or
any other Loan Party after the Effective Date from (a) any cash
contributions made to its common equity capital (other than contributions made
by Holdings (unless such cash contributions originate from the Sponsor), the
Parent Borrower or any Subsidiary), (b) any sale (other than to Holdings,
any Subsidiary or any management equity plan, stock option plan or any other
management or employee benefit plan or agreement of the Parent Borrower or any
Subsidiary) of Qualified Equity Interests, (c) any non-ordinary course
asset sale permitted by Section 6.05, (d) any dividends or
distributions received with respect to Equity Interests in AAG, (e) any
AAG Proceeds required to be offered as a prepayment to the holders of the
Senior Secured Notes pursuant to the Senior Secured Notes Indenture that are
not accepted by such holders minus any such AAG Proceeds distributed or
paid to the Sponsor and (f) any AAG Proceeds not required to be offered as
a prepayment to the holders of the Senior Secured Notes pursuant to the Senior
Secured Notes Indenture minus any AAG Proceeds distributed or paid to
the Sponsor.

 

“Excluded
Taxes” means, with respect to the Administrative Agent, any Lender, the
Issuing Bank or any other recipient of any payment to be made by or on account
of any obligation of any Loan Party hereunder,

 

25

 

(a) income
or franchise taxes imposed on (or measured by) its net income by the United
States of America or Canada, or by the jurisdiction under the laws of which
such recipient is organized or in which its principal office is located or, in
the case of the Administrative Agent, the Issuing Bank or any Lender, in which
its applicable lending office is located, or any amount withheld on account of
such tax pursuant to the laws of Canada or any province or territory therein;

 

(b) any
branch profits taxes imposed by the United States of America or Canada or any
similar tax imposed by any other jurisdiction described in clause (a) above;

 

(c) any withholding
tax that is attributable to the Administrative Agent’s, the Issuing Bank’s or a
Lender’s failure to comply with Section 2.17(e);

 

(d) in
the case of the Administrative Agent, the Issuing Bank or any Lender (other
than an assignee pursuant to a request by a Borrower under Section 2.19(b)),
any withholding tax imposed by the United States of America that is in
effect and would apply to amounts payable to the Administrative Agent, the
Issuing Bank or such Lender at the time the Administrative Agent, the Issuing
Bank or such Lender became a party to the Original Credit Agreement (or, in the
case of a Lender that is not a party to the Original Credit Agreement
immediately prior to the Restatement Effective Date, becomes a party to this
Agreement) (or designates a new lending office), except to the extent that (i) the
Administrative Agent, the Issuing Bank or such Lender (or its assignor, if any)
was entitled, at the time of designation of a new lending office (or
assignment), to receive additional amounts from a Loan Party with respect to
any withholding tax pursuant to Section 2.17(a) or (ii) such
withholding tax shall have resulted from the making of any payment to a
location other than the office designated by the Administrative Agent, the
Issuing Bank or such Lender for the receipt of payments of the applicable type;
and

 

(e) any
withholding tax imposed under the laws of Canada or any province or territory
therein that is in effect and would apply to amounts payable to the
Administrative Agent, the Issuing Bank or any Lender, were such amounts paid at
the time the Administrative Agent, the Issuing Bank or such Lender, as the case
may be, became a party to the Original Credit Agreement (or, in the case of a
Lender that is not a party to the Original Credit Agreement immediately prior
to the Restatement Effective Date, becomes a party to this Agreement) (or
designates a new lending office), except any such withholding tax that would
not have arisen but for (i) an assignment made pursuant to a request by a
Borrower under Section 2.19(b) or (ii) the making of any payment
to a location other than the office designated by the Administrative Agent, the
Issuing Bank or Lender, as the case may be, for the receipt of payments of the
applicable type.

 

“Existing Letters of Credit” means each letter of credit
previously issued for the account of any Borrower or Subsidiary pursuant to the
Original Credit Agreement that is outstanding on the Restatement Effective
Date.

 

“Fair Labor
Standards Act” means the Fair Labor Standards Act, 29 U.S.C. §§ 201 et
seq.

 

“Federal
Funds Effective Rate” means, for any day, the weighted average (rounded
upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as published on the next succeeding Business Day by
the Federal Reserve Bank of New York, or, if such rate is not so published
for any day that is a Business Day, the average (rounded upwards, if necessary,
to the next 1/100 of 1%) of the quotations for such day for such transactions
received by the Administrative Agent from three 

 

26

 

Federal funds brokers of recognized standing
selected by it.

 

“Financial
Officer” means, with respect to any Person, the chief financial officer,
principal accounting officer, vice president of finance, assistant treasurer,
treasurer or controller of such Person. 
Unless otherwise expressly indicated, “Financial Officer” shall mean a
Financial Officer of the Parent Borrower.

 

“Fixed
Charges” means, with reference to any period, without duplication, (a) Consolidated
Cash Interest Expense, plus (b) scheduled principal payments by a
Loan Party on Funded Indebtedness made during such period, plus (c) payments
made during such period or in any period prior to such period in respect of
Funded Indebtedness to the extent that such payments reduced any scheduled
principal payments referred to in clause (b) that would have become due
during such period, plus (d) expense for taxes paid  in cash during such period, plus (e) regularly-scheduled
dividends or distributions on preferred Equity Interests paid in cash during
such period, plus (f) Capital Lease Obligation payments made during
such period, all calculated for the Parent Borrower and the Subsidiaries on a
consolidated basis.

 

“Fixed
Charge Coverage Ratio” means the ratio, determined as of the end of each
fiscal quarter of the Parent Borrower for the most-recently ended four fiscal
quarters, of (a) Consolidated EBITDA minus the unfinanced portion
of Capital Expenditures, to (b) Fixed Charges, all calculated for the
Parent Borrower and the Subsidiaries on a consolidated basis in accordance with
GAAP.

 

“Foreign
Applicable Percentage” has the meaning assigned to such term in Section 10.10(b).

 

“Foreign
Guaranteed Obligations” has the meaning assigned to such term in Section 10.01(b).

 

“Foreign
Lender” means any Lender that is organized under the laws of a jurisdiction
other than that in which the Parent Borrower is located except that in respect
of the Canadian Subsidiary Borrower or any Canadian Subsidiary Loan Party, “Foreign
Lender” means a Lender that is not a Canadian Resident.  For purposes of this definition, the United
States of America, each State thereof and the District of Columbia shall be
deemed to constitute a single jurisdiction.

 

“Foreign
Loan Guarantor” means each Foreign Subsidiary Loan Party.

 

“Foreign
Mortgage” means a mortgage, deed of trust, assignment of leases and rents,
leasehold mortgage or other security document (including any amendment,
modification or supplement thereto) granting a Lien on any Mortgaged Property
located outside the United States of America and Canada to secure the Canadian
Secured Obligations.  Each Foreign Mortgage
shall be reasonably satisfactory in form and substance to the Administrative
Agent.

 

“Foreign
Non-Paying Guarantor” has the meaning assigned to such term in Section 10.10(b).

 

“Foreign
Paying Guarantor” has the meaning assigned to such term in Section 10.10(b).

 

“Foreign
Security Agreement” means a pledge or charge agreement with respect to the
Collateral that constitutes Equity Interests of a Foreign Subsidiary and/or a
security agreement with respect to the Collateral of a Foreign Subsidiary (other
than Collateral that constitutes Equity Interests of such Foreign Subsidiary),
in each case in form and substance reasonably satisfactory to the 

 

27

 

Administrative Agent.

 

“Foreign
Subsidiary” means any Subsidiary that is organized under the laws of a
jurisdiction other than the United States of America, any State thereof or the
District of Columbia.

 

“Foreign
Subsidiary Loan Party” means any Foreign Subsidiary (other than the
Canadian Subsidiary Borrower), including any Canadian Subsidiary Loan Party but
excluding (a) Indalex UK Limited and (b) any other Foreign Subsidiary
(i) that is prohibited under mandatory provisions of its organizational
documents, applicable law or contractual restrictions in existence on the date
such Foreign Subsidiary became a Subsidiary (and not created in anticipation
thereof) from guaranteeing, providing Collateral to secure, or otherwise
becoming liable for, the Canadian Secured Obligations or (ii) in the event
that any officer, director or employee thereof would more likely than not incur
liability under applicable law (including, for the avoidance of doubt, any
financial assistance laws of England and Wales or the United Kingdom) in
connection with such Foreign Subsidiary being deemed a “Foreign Subsidiary Loan
Party” under the Loan Documents or from guaranteeing, providing Collateral to
secure, or otherwise becoming liable for, the Canadian Secured Obligations.

 

“Fostoria
Plant” means the real property owned by the U.S. Company commonly known as
930 Sandusky Street, Fostoria, Ohio 44830.

 

“Fronting
Co-Investors” means the Co-Investors listed on Schedule 1.05 and their
successors and assigns.

 

“Fronting
Fee” has the meaning assigned to such term in Section 2.12(b).

 

“Funded Indebtedness”
of any Person means the principal amount of Indebtedness (other than
Indebtedness described in clauses (f) and (j) of the definition
thereof), including all current maturities and current sinking fund payments in
respect of such Indebtedness (whether or not required to be paid within one
year from the date of its creation) and, in the case of the Borrowers,
Indebtedness in respect of the Loans.

 

“Funding
Account” means Account No. 3751572376 maintained at Bank of America,
N.A. or such other account identified in writing by the Parent Borrower to the
Administrative Agent.

 

“GAAP”
means generally accepted accounting principles in the United States of America.

 

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

 

“Granting
Lender” has the meaning assigned to such term in Section 9.04(e).

 

“Grantor”
means Holdings, each Borrower, each U.S. Loan Guarantor and each Foreign Loan
Guarantor.

 

“Guarantee”
of or by any Person (the “guarantor”) means any obligation, contingent
or otherwise, of the guarantor guaranteeing or having the economic effect of
guaranteeing any Indebtedness 

 

28

 

or other obligation of any other Person (the “primary
obligor”) in any manner, whether directly or indirectly, and including any
obligation of the guarantor, direct or indirect, (a) to purchase or pay
(or advance or supply funds for the purchase or payment of) such Indebtedness
or other obligation or to purchase (or to advance or supply funds for the
purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to
maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account
party in respect of any letter of credit or letter of guaranty issued to
support such Indebtedness or obligation, provided that the term
Guarantee shall not include endorsements for collection or deposit in the
ordinary course of business; and provided  further that the amount
of any Guarantee shall be deemed to be equal to the lesser of (i) an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such Guarantee is made and (ii) (x) the maximum
amount for which such guarantor may be liable pursuant to the terms of the
instrument embodying such Guarantee or (y) if such Guarantee is not an
unconditional guarantee of the entire amount of the primary obligation in
respect of which such Guarantee is made and such maximum amount is not stated
or determinable, the amount of such guarantor’s maximum reasonably-anticipated
liability in respect thereof as determined by such guarantor in good faith.

 

“Guaranteed
Obligations” has the meaning assigned to such term in Section 10.01(b).

 

“Guaranteed
Parties” has the meaning assigned to such term in Section 10.09.

 

“Hazardous
Materials” means (i) any petroleum products or byproducts and all
other hydrocarbons, coal ash, radon gas, asbestos, urea formaldehyde foam
insulation, polychlorinated biphenyls, chlorofluorocarbons and other
ozone-depleting substances, and toxic mold; and (ii) any chemical,
material, substance or waste that is prohibited, limited or regulated by or
pursuant to any Environmental Law.

 

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

 

“Incremental
Term Loans” has the meaning assigned to such term in Section 2.21(a).

 

“Indebtedness”
of any Person means, without duplication, (a) all obligations of such
Person for borrowed money, (b) all obligations of such Person evidenced by
bonds, debentures, notes or similar instruments, (c) all obligations of
such Person under conditional sale or other title retention agreements relating
to property acquired by such Person, (d) all obligations of such Person in
respect of the deferred purchase price of property or services (excluding (x) deferred
compensation arrangements and (y) accounts payable that are not more than
60 days past due, in each case entered into or incurred, as the case may be, in
the ordinary course of business), (e) all Indebtedness of others secured
by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien on property owned or
acquired by such Person, whether or not the Indebtedness secured thereby has
been assumed, (f) all Guarantees by such Person of Indebtedness of others,
(g) all Capital Lease Obligations of such Person, (h) all
obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty, (i) all obligations,
contingent or otherwise, of such Person in respect of bankers’ acceptances and (j) any
other Off-Balance Sheet Liability.  The
Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent such Person is liable therefor as a result of such Person’s ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable
therefor.  Notwithstanding the foregoing,
in connection with any Permitted Acquisition or any acquisition by the Parent
Borrower or any Subsidiary, the term “Indebtedness” shall not include (i) reimbursement
obligations in respect of any letter of credit 

 

29

 

assumed in such Permitted Acquisition or
acquisition, the payment of which is either (x) backed by a Letter of
Credit or (y) cash collateralized, or (ii) post-closing purchase
price adjustments, earn-outs or similar obligations that are dependent upon the
performance of the acquisition target after such closing to which the seller in
such Permitted Acquisition or acquisition may become entitled (except to the
extent such post-closing purchase price adjustments, earn-outs or similar
obligations are overdue by more than 30 days after the date on which the amount
of the payments in respect of such post-closing purchase price adjustments,
earn-outs or similar obligations become fixed). 
The amount of Indebtedness of any Person for purposes of clause (e) above
shall (unless such Indebtedness has been assumed by, or is otherwise recourse
to, such Person) be deemed to be equal to the lesser of (i) the aggregate
unpaid amount of such Indebtedness and (ii) the fair market value of the
property encumbered thereby as determined by such Person in good faith, and the
amount of any contingent Indebtedness of any Person shall be the maximum
reasonably anticipated liability in respect thereof as determined by such
Person in good faith.

 

“Indemnified
Taxes” means Taxes other than Excluded Taxes.

 

“Indemnitee”
has the meaning assigned to such term in Section 9.03(b).

 

“Information
Memorandum” means the Confidential Information Memorandum dated November 2005,
relating to the Parent Borrower and the Original Transactions.

 

“Initial
Term Commitment” means, with respect to the Initial Term Lender, the
commitment of such Lender to make the Initial Term Loan hereunder on the
Restatement Effective Date, expressed as an amount in U.S. Dollars representing
the maximum principal amount of the Initial Term Loan to be made by such Lender
hereunder.  The aggregate principal
amount of the Initial Term Lender’s Initial Term Commitment is $15,000,000.

 

“Initial
Term Lender” means Sun Indalex Finance, LLC, a Delaware limited liability
company.

 

“Initial
Term Loan” means the Loan made pursuant to Section 2.01(c).

 

“Insolvency
or Liquidation Proceeding” means (a) any voluntary or involuntary case
or proceeding under any Bankruptcy Law, with respect to any Grantor, (b) any
other voluntary or involuntary insolvency, reorganization or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or other similar
case or proceeding with respect to any Grantor or with respect to any of its
assets, (c) any liquidation, dissolution, reorganization or winding up of
any Grantor whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy or (d) any assignment for the benefit of
creditors or any other marshalling of assets and liabilities of any Grantor.

 

“Intercreditor
Agent” has the meaning assigned to such term in Section 9.21.

 

“Intercreditor
Agreement” means the Intercreditor Agreement dated as of February 2,
2006 (as amended, amended and restated, modified, supplemented or replaced from
time to time in accordance with this Agreement), among JPMorgan Chase Bank, N.A.,
as Intercreditor Agent, U.S. Bank, National Association, as trustee, Holdings
and the Domestic Subsidiary Loan Parties party thereto, or another
intercreditor agreement that is no less favorable to the Secured Parties than
the Intercreditor Agreement, as determined by the Administrative Agent in good
faith.

 

“Interest
Election Request” means a request by the applicable Borrower to convert or
continue a Revolving Borrowing, a Term Borrowing or a B/A in accordance with Section 2.08.

 

30

 

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

 

“Interest
Period” means, with respect to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is one, two, three or
six months thereafter (or nine or twelve months thereafter if, at the time
of the relevant Borrowing or conversion or continuation thereof, all Lenders
participating therein agree to make an interest period of such duration
available), as the applicable Borrower may elect, provided that (a) if
any Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day and (b) any
Interest Period that commences on the last Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of
the last calendar month of such Interest Period.  For purposes hereof, the date of a Eurodollar
Borrowing initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.

 

“Inventory”
has the meaning assigned to such term in the Security Agreements.

 

“Inventory
Value” means, at any time, with respect to the Inventory of any Loan Party,
the U.S. Dollar Equivalent of the standard cost of such Inventory carried on
the records of such Loan Party at such time (valued on a first-in, first-out
basis) less any markup on any such Inventory received from an Affiliate,
provided that in the event variances under the standard cost method (a) are
capitalized, favorable variances shall be deducted from Inventory and
unfavorable variances shall not be added to Inventory, or (b) are
expensed, a reserve shall be determined in the Administrative Agent’s Permitted
Discretion as appropriate in order to adjust the standard cost of Inventory to
approximate actual cost.

 

“IPO”
means a bona fide underwritten initial public offering of voting common Equity
Interests of Holdings (or, in the alternative, the Parent Borrower) newly
issued by Holdings (or, in the alternative, the Parent Borrower) or held in
treasury as a direct result of which at least 10% of the aggregate voting
common Equity Interests of Holdings (or, in the alternative, the Parent
Borrower) (in each case, calculated on a fully diluted basis taking into
account all options or other rights to acquire voting common Equity Interests
of Holdings (or, in the alternative, the Parent Borrower) then outstanding,
regardless of whether such options or other rights are then currently
exercisable) will be beneficially owned by Persons other than the Permitted
Holders, Holdings and Affiliates of Holdings (including all directors, officers
and employees of Holdings, the Parent Borrower or any of the Subsidiaries).

 

“Issuing
Bank” means JPMorgan Chase Bank, N.A., in its capacity as the issuer of
Letters of Credit hereunder, and its successors in such capacity as provided in
Section 2.05(i).  The Issuing Bank
may, in its discretion, arrange for one or more Letters of Credit to be issued
by Affiliates of the Issuing Bank and may, in the case of Letters of Credit
issued for the account of the Canadian Subsidiary Borrower or any Foreign
Subsidiary, arrange for such Letters of Credit to be issued by JPMorgan Chase
Bank, N.A., Toronto Branch, in which case the term “Issuing Bank” shall include
JPMorgan Chase Bank, N.A., Toronto Branch, or any other such Affiliate with
respect to Letters of Credit 

 

31

 

issued by JPMorgan Chase Bank, N.A., Toronto
Branch, or any other such Affiliate.

 

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

 

“Judgment
Currency” has the meaning assigned to such term in Section 9.19(a).

 

“Judgment
Currency Conversion Date” has the meaning assigned to such term in

Section 9.19(a).

 

“L/C
Collateral Account” has the meaning assigned to such term in Section 2.05(j).

 

“L/C
Disbursement” means a U.S. L/C Disbursement or Canadian L/C Disbursement,
as the context may require.

 

“Lenders”
means the Persons listed on the Commitment Schedule and any other Person that
shall have become a party hereto pursuant to Section 2.21 or Section 9.04,
other than any such Person that ceases to be a party hereto pursuant to Section 9.02(d),
Section 9.02(e) or Section 9.04. 
Unless the context otherwise requires, the term “Lenders” includes the
Swingline Lender.  References to any
Lender in this Agreement or any other Loan Document shall be deemed to mean
such Lender’s affiliated Canadian Lending Office, where applicable.

 

“Letter of
Credit” means any letter of credit issued pursuant to this Agreement and
any Existing Letter of Credit.

 

“LIBO Rate”
means, with respect to any Eurodollar Borrowing for any Interest Period, the
rate appearing on Page 3750 of the Dow Jones Market Service (or on any
successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to U.S. Dollar deposits in the London interbank
market) at approximately 11:00 a.m., London time, two Business Days prior
to the commencement of such Interest Period, as the rate for U.S. Dollar
deposits in an amount comparable to the amount of such Eurodollar Borrowing and
with a maturity comparable to such Interest Period.  In the event that such rate is not available
at such time for any reason, then the “LIBO Rate” with respect to such
Eurodollar Borrowing for such Interest Period shall be the rate at which U.S.
Dollar deposits of an amount comparable to the amount of such Eurodollar
Borrowing and for a maturity comparable to such Interest Period are offered by
the principal London office of the Administrative Agent in immediately
available funds in the London interbank market at approximately 11:00 a.m.,
London time, two Business Days prior to the commencement of such Interest
Period.

 

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

 

“Loan
Documents” means this Agreement, any promissory notes issued pursuant to
this Agreement, the Original Credit Agreement (solely with respect to
representations and warranties made with respect to matters arising out of, or
in any way related to, facts or events existing or occurring on or prior to the
Restatement Effective Date), any Letter of Credit applications, the Collateral
Documents, the Intercreditor Agreement, the Loan Guaranty and all other
agreements, instruments, documents and 

 

32

 

certificates identified in Section 4.01
executed and delivered to, or in favor of, the Administrative Agent or any
Lenders and including all other pledges, powers of attorney, consents,
assignments, contracts and letter of credit agreements whether heretofore, now
or hereafter executed by or on behalf of any Loan Party, or any employee of any
Loan Party, and delivered to the Administrative Agent or any Lender in
connection with the Agreement or the transactions contemplated thereby.  Any reference in the Agreement or any other
Loan Document to a Loan Document shall include all appendices, exhibits or
schedules thereto, and all amendments, restatements, supplements or other
modifications thereto, and shall refer to the Agreement or such Loan Document
as the same may be in effect at any and all times such reference becomes
operative.  For purposes of clarity, “Loan
Documents” shall be deemed not to include the Senior Secured Notes Documents,
the Acquisition Documents or any documentation executed and delivered for the
purpose of consummating the Equity Contribution.

 

“Loan
Guarantors” means, collectively, the U.S. Loan Guarantors and the Foreign
Loan Guarantors.

 

“Loan
Guaranty” means Article X of this Agreement and, to the extent
necessary, each separate Guarantee, in form and substance reasonably
satisfactory to the Administrative Agent, delivered by each Loan Guarantor that
is a Foreign Subsidiary (which Guarantee shall be governed by the laws of the
applicable jurisdiction in which such Foreign Subsidiary is located), as it may
be amended or modified and in effect from time to time.

 

“Loan
Parties” means Holdings, the Parent Borrower, the Canadian Subsidiary
Borrower, the Domestic Subsidiary Loan Parties and the Foreign Subsidiary Loan
Parties.

 

“Loans”
means the loans and advances made by the Lenders pursuant to this Agreement,
including Swingline Loans, and any loans made by the Lenders to the Borrowers
under the Original Credit Agreement that are outstanding on the Restatement
Effective Date.

 

“Local Time”
means (a) with respect to a Loan or Borrowing made to the Parent Borrower
or a Letter of Credit issued for the account of the Parent Borrower or a
Domestic Subsidiary, New York City time, and (b) with respect to a Loan or
Borrowing made to the Canadian Subsidiary Borrower or a B/A accepted and
purchased by a Lender, or a Letter of Credit issued for the account of the
Canadian Subsidiary Borrower or a Foreign Subsidiary, Toronto time.

 

“Management
Services Agreement” means the Management Services Agreement dated as of February 2,
2006, between the Parent Borrower and the Sponsor.

 

“Material
Adverse Effect” means a material adverse effect on (a) the business,
assets, results of operations or financial condition of Holdings, the Parent
Borrower and the Subsidiaries, taken as a whole, (b) the ability of any
Loan Party to perform any of its material obligations under any Loan Document, (c) the
Collateral, taken as a whole, or the Administrative Agent’s Liens (on behalf of
itself and the Lenders) on the Collateral, taken as a whole, or the priority of
such Liens, or (d) the rights and remedies, taken as a whole, of the
Administrative Agent, the Issuing Bank or the Lenders under the Loan Documents.

 

“Material
Indebtedness” means Indebtedness (other than the Loans, Letters of Credit
and B/As), or obligations in respect of one or more Swap Agreements, of any one
or more of Holdings, the Parent Borrower and the Subsidiaries in an aggregate
principal amount exceeding $7,500,000. 
For purposes of determining Material Indebtedness, the “principal amount”
of the obligations of Holdings, the Parent Borrower or any Subsidiary in
respect of any Swap Agreement at any time shall be the maximum aggregate amount
(giving effect to any netting agreements) that Holdings, the Parent Borrower or
such 

 

33

 

Subsidiary would be required to pay if such
Swap Agreement were terminated at such time.

 

“Maturity
Date” means February 2, 2011, or any earlier date on which the
Commitments are reduced to zero or otherwise terminated pursuant to the terms
hereof.

 

“Maximum
Liability” has the meaning assigned to such term in Section 10.09.

 

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

 

“Mortgage”
means a U.S. Mortgage, a Canadian Mortgage, a Foreign Mortgage or a Canadian
Hypothec in respect of Mortgaged Property, as the context may require.

 

“Mortgaged
Property” means, initially, each parcel of real property and the
improvements thereto owned by a Loan Party and identified on Schedule 1.03,
and includes each other parcel of real property and the improvements thereto
owned by a Loan Party with respect to which a Mortgage is granted pursuant to Section 5.11.

 

“Multiemployer
Plan” means a multiemployer plan as defined in Section 4001(a)(3) of
ERISA that is contributed to by the Parent Borrower or any Domestic Subsidiary
Loan Party or any ERISA Affiliate.

 

“Net
Orderly Liquidation Value” means, at any time, with respect to Inventory,
Eligible Real Property or Eligible Machinery and Equipment of any Person, the
orderly liquidation value thereof (or, in the case of calculations made in
respect of the Canadian Borrowing Base, the U.S. Dollar Equivalent of the
orderly liquidation value thereof) as determined in a manner reasonably
acceptable to the Administrative Agent by an appraiser reasonably acceptable to
the Administrative Agent, net of all costs of liquidation thereof.

 

“Net
Proceeds” means, with respect to any event, (a) the cash proceeds
received in respect of such event, including (i) any cash received in
respect of any non-cash proceeds (including any cash payments received by way
of deferred payment of principal pursuant to a note or installment receivable
or purchase price adjustment receivable, earn-out or otherwise, but excluding
any reasonable interest payments), but only as and when received, (ii) in
the case of a casualty, cash insurance proceeds, and (iii) in the case of
a condemnation or similar event, cash condemnation awards and similar payments
received in connection therewith, minus (b) the sum of (i) all
reasonable fees and out-of-pocket expenses (including commissions and legal,
accounting and other professional and transaction fees) paid by Holdings, the
Parent Borrower and the Subsidiaries to third parties (other than Affiliates)
in connection with such event, (ii) in the case of a sale, transfer or
other disposition of an asset (including pursuant to a sale and leaseback
transaction or a casualty or a condemnation or similar proceeding), the amount
of all payments that are permitted hereunder and are made by Holdings, the
Parent Borrower and the Subsidiaries as a result of such event to repay
Indebtedness (other than Loans) secured by such asset or otherwise subject to
mandatory prepayment as a result of such event and (iii) the amount of all
taxes paid (or reasonably estimated to be payable) by Holdings, the Parent
Borrower and the Subsidiaries and the amount of any reserves established to
fund contingent liabilities reasonably estimated to be payable, in each case
during the year that such event occurred or the next succeeding year and that
are directly attributable to such event (as determined reasonably and in good
faith by a Financial Officer), provided that any reduction at any time
in the amount of any such reserves (other than as a result of payments made in
respect thereof) shall be deemed to constitute the receipt by the Parent Borrower
at such time of Net Proceeds in the amount of such reduction, but shall only
then be payable if otherwise required hereunder.

 

“Net
Recovery Liquidation Rate” means, at any time, with respect to Inventory of
any 

 

34

 

Person, the quotient (expressed as a
percentage) of (i) the Net Orderly Liquidation Value thereof divided
by (ii) the Inventory Value thereof (or, in the case of calculations made
in respect of the Canadian Borrowing Base, the U.S. Dollar Equivalent of the
Inventory Value thereof), determined on the basis of the then most recent
independent Inventory appraisal in form, scope and substance reasonably
satisfactory to the Administrative Agent.

 

“New
Securities” has the meaning assigned to such term in Section 9.24(b).

 

“Non-B/A
Lender” has the meaning assigned to such term in Section 2.06(k).

 

“Non-Paying Guarantor” has the meaning assigned to
such term in Section 10.10(b).

 

“Obligated Party” has the meaning assigned to such
term in Section 10.02.

 

“Obligation
Currency” has the meaning assigned to such term in Section 9.19(a).

 

“Obligations”
means, collectively, the U.S. Obligations and the Canadian Obligations.

 

“Off-Balance
Sheet Liability” of a Person means (a) any repurchase obligation or
liability of such Person with respect to accounts or notes receivable sold by
such Person to the extent such amounts could reasonably be expected to become
due, (b) any indebtedness, liability or monetary obligation under any
so-called “synthetic lease” transaction entered into by such Person or (c) any
indebtedness, liability or obligation arising with respect to any other
transaction that is the functional equivalent of or takes the place of
borrowing but that does not constitute a liability on the balance sheets of
such Person (other than operating leases).

 

“Original Credit Agreement” means the Credit Agreement dated as
of February 2, 2006 (as amended from time to time prior to the date
hereof), among Holdings, the Parent Borrower, 6461948 Canada Inc., the other
Subsidiaries of the Parent Borrower party thereto, the lenders party thereto
and JPMorgan Chase Bank, N.A., as administrative agent.

 

“Original
Transactions” means, collectively, (a) the Equity Contributions, (b) the
Acquisition and the other transactions contemplated by the Acquisition
Documents, (c) the execution, delivery and performance by each Loan Party
of each Loan Document (as defined under the Original Credit Agreement) to which
it is a party and, in the case of the Borrowers, the making of the initial
borrowings under the Original Credit Agreement and, to the extent requested,
the initial issuance of Letters of Credit and the initial acceptance and
purchase of B/As under the Original Credit Agreement, (d) the execution,
delivery and performance by Holdings, the Parent Borrower and each Domestic
Subsidiary Loan Party of the Senior Secured Notes Documents to which it is a
party, (e) the issuance of the Senior Secured Notes and the use of the
proceeds thereof, (f) the consummation of the amalgamation of 6461948
Canada Inc. with the Canadian Company, (g) the consummation of any
other transactions in connection with the foregoing and (h) the payment of
the fees and expenses incurred in connection with any of the foregoing.

 

“Other
Eligible Inventory” means, at any time, the portion of Eligible Inventory
of (x) the Parent Borrower and the wholly-owned Domestic Subsidiary Loan
Parties at such time, in the case of the Domestic Borrowing Base, or (y) the
Canadian Subsidiary Borrower and the wholly-owned Canadian Subsidiary Loan
Parties at such time, in the case of the Canadian Borrowing Base, in each case
that is comprised of Inventory other than aluminum billets and logs as shown on
the applicable Loan Party’s Inventory records in accordance with such Loan Party’s
current and historical accounting practices.

 

35

 

“Other
Taxes” means any and all present or future recording, stamp or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made under any Loan Document or from the execution, delivery
or enforcement of, or otherwise with respect to, any Loan Document, provided
that, for the avoidance of doubt, Other Taxes shall not include any income
taxes or withholding taxes.

 

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

 

“Participant”
has the meaning assigned to such term in Section 9.04(c)(i).

 

“Participation
Fee” has the meaning assigned to such term in Section 2.12(b).

 

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

 

“Perfection
Certificates” means, collectively, the Domestic Perfection Certificate and
the Canadian Perfection Certificate.

 

“Permitted
Acquisition” means any acquisition by either Borrower or any wholly-owned
Subsidiary Loan Party of all the outstanding Equity Interests (other than
directors’ qualifying shares) in, all or substantially all the assets of, or
all or substantially all the assets constituting a division or line of business
of, a Person if (a) such acquisition was not preceded by, or consummated
pursuant to, a hostile offer (including a proxy contest), (b) to the
knowledge of any Responsible Officer of any Loan Party, no Default has occurred
and is continuing or would result therefrom, (c) such acquisition and all
transactions related thereto are consummated in accordance with applicable
laws, (d) all actions required to be taken with respect to such acquired
or newly-formed Subsidiary or such acquired assets under Section 5.11
shall have been taken (or simultaneously with the consummation of such
acquisition shall be taken), (e) after giving effect to such acquisition,
Reference Availability shall not be less than $35,000,000, (f) the
business of such Person or such assets, as the case may be, constitutes a
business permitted by Section 6.03(b), and (g) the Parent Borrower
has delivered to the Administrative Agent a certificate of a Financial Officer
to the effect set forth in clauses (a) through (f) above, together
with all relevant financial information for the Person or assets to be acquired
as reasonably requested by the Administrative Agent.

 

“Permitted
Discretion” means a determination made in good faith and in the exercise of
reasonable (from the perspective of a secured asset-based lender) business
judgment.

 

“Permitted Encumbrances”
means:

 

(a) Liens
imposed by law for Taxes (including customs duties), assessments or other
governmental charges or levies that are not yet due, are being contested in
compliance with Section 5.04 or are permitted to be due hereunder;

 

(b) carriers’,
warehousemen’s, mechanics’, materialmen’s, suppliers’, repairmen’s,
construction, builders’, landlords’ and other like Liens imposed by statutory
or common law, arising in the ordinary course of business and securing
obligations that are not overdue by more than 60 days or are being contested in
compliance with Section 5.04;

 

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

 

36

 

(d) deposits
to secure the performance of bids, tenders, trade contracts, government
contracts, leases, statutory obligations, self-insurance or reinsurance
obligations, stay customs, surety and appeal or similar bonds, performance
bonds, security deposits (including (x) security deposits for import or
customs duties and other amounts that are being contested in compliance with Section 5.04
and (y) customary security deposits for the payment of rent) and other
obligations of a like nature, in each case in the ordinary course of business;

 

(e) judgment
liens in respect of judgments that do not constitute an Event of Default
hereunder;

 

(f) immaterial
survey exceptions, easements, zoning restrictions, rights-of-way, agreements
with Governmental Authorities disclosed by registered titles to the Mortgaged
Properties and similar encumbrances on real property imposed by law or arising
in the ordinary course of business that do not secure any monetary obligations
and that either (i) in the aggregate do not materially detract from the
value of the affected property or interfere with the ordinary conduct of
business of the Parent Borrower or any Subsidiary or (ii) are described in
a mortgage policy of the title insurance or surveys issued in favor of and
accepted by the Administrative Agent with respect to any property; and

 

(g) Liens
arising from Permitted Investments described in clause (d) of the
definition of the term “Permitted Investments”,

 

provided
that the term “Permitted Encumbrances” shall not include any Lien securing
Indebtedness (other than Indebtedness in respect of Permitted Investments
described in clause (g) above).

 

“Permitted
Holders” means the Sponsor, the Sponsor Affiliates and the Co-Investors.

 

“Permitted Investments”
means:

 

(a) direct
obligations of, or obligations the principal of and interest on which are
unconditionally guaranteed by, the United States of America (or by any agency
thereof to the extent such obligations are backed by the full faith and credit
of the United States of America), in each case maturing within one year from
the date of acquisition thereof;

 

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

 

(c) investments
in certificates of deposit, banker’s acceptances and time or demand deposits
maturing within 365 days from the date of acquisition thereof issued or
guaranteed by or placed with, and money market deposit accounts issued or
offered by, any domestic office of any commercial bank organized under the laws
of the United States of America or any State thereof which has a combined
capital and surplus and undivided profits of not less than $500,000,000;

 

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

 

(e) investments
in securities with maturities of 365 days or less from the date of acquisition
thereof issued or fully guaranteed by any state, commonwealth or territory of
the United States of America, or by any political subdivision or taxing
authority thereof, and with a 

 

37

 

rating of A or higher by S&P and A2 or higher by Moody’s;

 

(f) Indebtedness
issued by Persons (other than the Sponsor or any of Sponsor Affiliate) with a
rating of A or higher by S&P and A2 or higher by Moody’s;

 

(g) investments
in any money market fund that invests at least 95% of its assets in securities
of the types described in clauses (a) through (f) above; and

 

(h) in
the case of the Canadian Subsidiary Borrower or any Foreign Subsidiary, (i) investments
of the type and maturity described in clauses (a) through (g) above
of foreign obligors, which investments or obligors (or the parents of such
obligors) have ratings described in clause (b) above or equivalent
ratings from comparable foreign rating agencies or (ii) investments of the
type and maturity described in clauses (a) through (g) above of foreign
obligors (or the parents of such obligors), which investments or obligors (or
the parents of such obligors) are not rated as provided in such clauses or in
clause (i) above but which are, in the reasonable judgment of the Parent
Borrower, comparable in investment quality to such investments and obligors (or
the parents of such obligors).

 

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

 

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

 

“PP&E Component” means, at the time of any
determination, (a) with respect to the Domestic Borrowing Base, an amount
equal to the sum of (i) 85% of the Net Orderly Liquidation Value of
Eligible Machinery and Equipment of the Parent Borrower and the wholly-owned
Domestic Subsidiary Loan Parties at such time, provided that the
aggregate amount determined pursuant to this subclause (a)(i) shall not
constitute more than 20% of the aggregate Domestic Borrowing Base at such time,
and (ii) the lesser of (A) 50% of the fair market value (as set forth
in the then most recent independent appraisal in form, scope and substance reasonably
satisfactory to the Administrative Agent) of Eligible Real Property of the
Parent Borrower and the wholly-owned Domestic Subsidiary Loan Parties at such
time, and (B) $15,000,000, provided that beginning on the first
anniversary of the Effective Date such amount referred to in this subclause (B) shall
decrease by $3,000,000 per annum, and (b) with respect to the Canadian
Borrowing Base, an amount equal to the sum of (i) 85% of the U.S. Dollar
Equivalent of the Net Orderly Liquidation Value of Eligible Machinery and
Equipment of the Canadian Subsidiary Borrower and the wholly-owned Canadian
Subsidiary Loan Parties at such time, provided that the aggregate amount
determined pursuant to this subclause (b)(i) shall not constitute more
than 20% of the aggregate Canadian Borrowing Base at such time, and (ii) the
lesser of (A) 50% of the U.S. Dollar Equivalent of the fair market value
(as set forth in the then most recent independent appraisal in form, scope and
substance reasonably satisfactory to the Administrative Agent) of Eligible Real
Property of the Canadian Subsidiary Borrower and the wholly-owned Canadian
Subsidiary Loan Parties at such time, and (B) $5,000,000, provided
that beginning on the first anniversary of the Effective Date such amount referred
to in this subclause (B) shall decrease by $1,000,000 per annum.  Notwithstanding the foregoing, (x) at
the time of any determination, the aggregate amount of the PP&E Component
with respect to the Domestic Borrowing Base and the Canadian Borrowing Base, on
a combined basis, shall not exceed $50,000,000 and (y) the Parent Borrower
shall have the option, at one time during the term of this Agreement, to
reallocate the amounts between clauses (a)(ii)(B) and (b)(ii)(B) (so
long as the aggregate amount under 

 

38

 

such clauses does not exceed $20,000,000 less
the aggregate amount of decreases to the date of determination pursuant to the
provisos to clauses (a)(ii)(B) and (b)(ii)(B)) and the amounts of such
decreases set forth in the provisos to clauses (a)(ii)(B) and (b)(ii)(B) shall
be adjusted in a manner reasonably satisfactory to the Administrative Agent to
reflect such reallocation effected by the Parent Borrower.

 

“Prepayment
Account” means an account established by the Canadian Subsidiary Borrower
with the Administrative Agent and over which the Administrative Agent shall
have exclusive dominion and control, including the exclusive right of
withdrawal for application in accordance with Section 2.11(e).

 

“Prepayment
Amount” has the meaning assigned to such term in Section 5.12.

 

“Prime Rate”
means the rate of interest per annum publicly announced from time to time by
JPMorgan Chase Bank, N.A., as its prime rate in effect at its principal office
in New York City (the Prime Rate not being intended to be the lowest rate of
interest charged by JPMorgan Chase Bank, N.A., in connection with extensions of
credit to debtors).

 

“Projections”
has the meaning assigned to such term in Section 5.01(e).

 

“Proposed
Change” has the meaning assigned to such term in Section 9.04(d).

 

“Public
Company” means Holdings (or, if applicable, the Parent Borrower) after the
consummation of, and giving effect to, an IPO of such Person.

 

“Purchase
Agreement” means the Stock Purchase Agreement dated as of September 16,
2005, by and among the Parent Borrower, Novar USA Holdings Inc., Novar Overseas
Holdings B.V. and Honeywell International Inc.

 

“Purchase
Date” has the meaning assigned to such term in Section 9.26(b).

 

“Purchase
Event” has the meaning assigned to such term in Section 9.26(a).

 

“Purchase
Price” has the meaning assigned to such term in the Purchase Agreement.

 

“Purchase
Price Adjustment Proceeds” means the proceeds, if any, received by either
Borrower in connection with any working capital adjustment to the Purchase
Price pursuant to the terms of the Purchase Agreement.

 

“Purchasing
Party” has the meaning assigned to such term in Section 9.26(a).

 

“Qualified
Equity Interests” means Equity Interests of Holdings other than Disqualified
Equity Interests.

 

“Reference
Availability” means, on any day, an amount equal to the lesser of (a) Average
Availability as of such date and (b) the end of day Availability on the
immediately preceding Business Day (or, for the purposes of any determination
made under the definition of “Permitted Acquisition” or Section 2.11(a), Section 6.04(m),
Section 6.08(b)(vi) or Section 6.08(b)(ix), an amount equal to
the lesser of (x) Average Availability and (y) Availability, in each
case as determined on a pro forma basis immediately after giving effect to any
Loans incurred in connection with the applicable prepayment, acquisition,
investment or purchase, as the case may be).

 

39

 

“Register”
has the meaning set forth in Section 9.04(b)(iv).

 

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

 

“Release”
means any actual or threatened release, spill, emission, leaking, dumping,
injection, pouring, deposit, disposal, discharge, dispersal, leaching or
migration into or through the environment (including ambient air, surface
water, groundwater, land surface or subsurface strata) or within or upon any
building, structure, facility or fixture.

 

“Report”
means reports prepared by the Administrative Agent or another Person showing
the results of appraisals, field examinations or audits pertaining to the
Parent Borrower or any Subsidiary’s assets from information furnished by or on
behalf of the Parent Borrower or any such Subsidiary, after the Administrative
Agent has exercised its rights of inspection pursuant to this Agreement, which
Reports may be distributed to the Lenders by the Administrative Agent.

 

“Required
Lenders” means, at any time, Lenders having Revolving Exposure, Term Loans
and unused Revolving Commitments representing more than 50% of the sum of the
aggregate Revolving Exposure, aggregate outstanding Term Loans and the
aggregate unused Revolving Commitments at such time.

 

“Required
Restatement Lenders” means, collectively, (a) the Required Lenders (as
such term is defined in the Original Credit Agreement) immediately prior to the
Restatement Effective Date and (b) the Initial Term Lender.

 

“Requirement
of Law” means, with respect to any Person, (a) the charter, articles
or certificate of organization or incorporation and bylaws or other
organizational or governing documents of such Person and (b) any statute,
law, treaty, rule, regulation, order, decree, writ, injunction or determination
of any arbitrator or court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to which
such Person or any of its property is subject, and including Environmental
Laws.

 

“Reserves”
means any and all reserves that the Administrative Agent deems necessary, in
its Permitted Discretion, to maintain (including, without duplication, reserves
for overdue or accrued and unpaid interest on the Secured Obligations, reserves
for up to three months’ rent at locations leased by any Loan Party and for
consignee’s, warehousemen’s and bailee’s charges (in each case to the extent
the Inventory located at such leased location or warehouse or subject to such
consignment or bailment is not covered by a Collateral Access Agreement),
reserves for lower of cost or market Inventory valuation, reserves for
Inventory shrinkage, reserves for customs charges and shipping charges related
to any Inventory in transit, reserves for Swap Obligations in excess of
$5,000,000 and any cash collateral posted with respect to any Swap Obligations,
reserves for contingent liabilities of any Loan Party that are reasonably
likely to become actual liabilities, reserves for uninsured losses of any Loan
Party, reserves for uninsured, underinsured, un-indemnified or
under-indemnified liabilities or potential liabilities with respect to any
litigation that are reasonably likely to become actual liabilities and reserves
for taxes, fees, assessments and other governmental charges and employee source
deductions, workers’ compensation obligations, vacation pay or pension fund
obligations) with respect to the Collateral or any Loan Party.  Any Reserve (including the amount of such
Reserve) shall bear a reasonable relationship to the events, conditions or
circumstances that are the basis for such Reserve.  The amount of any Reserve shall not be
duplicative of the amount of any other Reserve taken by any Loan Party with
respect to the same events, conditions or circumstances.  In the event that the Administrative Agent
determines in its Permitted 

 

40

 

Discretion that (a) the events,
conditions or circumstances underlying the maintenance of any Reserve shall
cease to exist or (b) the liability that is the basis for any Reserve has
been reduced, then such Reserve shall be rescinded or reduced in an amount as
determined in the Administrative Agent’s Permitted Discretion, as applicable,
at the request of the Parent Borrower.

 

“Responsible
Officer” means the chief executive officer or president of any Person or
any Financial Officer of such Person, and any other officer of such Person with
responsibility for the administration of the obligations of such Person under
this Agreement.  Unless otherwise
expressly indicated, “Responsible Officer” shall mean a Responsible Officer of
the Parent Borrower.

 

“Restatement
Effective Date” means the date on which the conditions specified in Section 4.01
are satisfied (or waived in accordance with Section 9.02).

 

“Restatement
Transactions” means, collectively, (a) the execution, delivery and
performance by each Loan Party of each Loan Document (or any amendment or amendment
and restatement thereto contemplated by this Agreement) to which it is a party
and, in the case of the Borrowers, the making of the Term Borrowings hereunder,
(b) the use of the proceeds from the Term Borrowings to repay U.S.
Revolving Borrowings in accordance with Section 5.08, (c) the
consummation of any other transactions in connection with the foregoing and (d) the
payment of the fees, costs and expenses incurred in connection with any of the
foregoing.

 

“Restricted
Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests in Holdings,
the Parent Borrower or any Subsidiary, or any payment (whether in cash,
securities or other property), including any sinking fund or similar deposit,
on account of the purchase, redemption, retirement, acquisition, cancelation or
termination of any Equity Interests in Holdings, the Parent Borrower or any
Subsidiary or any option, warrant or other right to acquire any such Equity
Interests in Holdings, the Parent Borrower or any Subsidiary, or any other
payment (including any payment under any Swap Agreement) that has a
substantially similar effect to any of the foregoing, other than compensation
in the ordinary course of business.

 

“Reuters Screen
CDOR Page” means the display designated as page CDOR on the Reuters
Monitor Money Rates Service or such other page as may, from time to time,
replace that page on that service for the purpose of displaying bid
quotations for bankers’ acceptances accepted by leading Canadian banks.

 

“Revolving
Commitment” means, with respect to each Revolving Lender, the commitment,
if any, of such Lender to make Revolving Loans and to acquire participations in
Letters of Credit and Swingline Loans and to accept and purchase, or arrange
for the purchase of, B/As hereunder during the Availability Period, expressed
as an amount in U.S. Dollars representing the maximum potential aggregate
amount of such Lender’s Revolving Exposure, as such commitment may be (a) reduced
from time to time pursuant to Section 2.09 or Section 2.19(b), (b) reduced
or increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 9.02(d), Section 9.02(e) or Section 9.04
and (c) increased from time to time pursuant to Revolving Commitment
Increases made pursuant to Section 2.21. 
The initial amount of each Revolving Lender’s Revolving Commitment is
set forth on the Commitment Schedule directly below the column entitled “Revolving
Commitments” or in the Assignment and Assumption or Commitment Increase
Amendment pursuant to which such Lender shall have assumed its Revolving
Commitment, as the case may be.  The
initial aggregate amount of the Revolving Lenders’ Revolving Commitments is
$200,000,000.

 

“Revolving
Commitment Increase” has the meaning assigned to such term in Section 2.21(a).

 

41

 

“Revolving
Exposure” means, with respect to any Revolving Lender at any time, the sum
of the outstanding principal amount of such Lender’s U.S. Revolving Exposure
and Canadian Revolving Exposure at such time. 
The aggregate Revolving Exposure at any time shall be the aggregate
amount of the Revolving Exposure of all Revolving Lenders at such time.

 

“Revolving
Lender” means a Lender with a Revolving Commitment or, if the Revolving
Commitments have terminated or expired, a Lender with Revolving Exposure.

 

“Revolving
Loans” means, collectively, the U.S. Revolving Loans and the Canadian
Revolving Loans.

 

“S&P”
means Standard & Poor’s Ratings Group, Inc.

 

“Schedule I
Lender”  means any Lender
named on Schedule I to the Bank Act (Canada).

 

“Schedule I
Reference Lenders”  means any
one or more of the Schedule I Lenders as may be agreed by the Canadian
Subsidiary Borrower and the Administrative Agent from time to time.

 

“Schedule
II Lender” means any Lender named on Schedule II to the Bank Act (Canada)
or any Lender that is a Canadian financial institution other than a Canadian
chartered bank and is not a Schedule III Lender.

 

“Schedule
II Reference Lender” means JPMorgan Chase Bank, N.A., Toronto Branch.

 

“Schedule
III Lender”  means any Lender
named on Schedule III to the Bank Act (Canada).

 

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

 

“Secured
Obligations” means, collectively, the U.S. Secured Obligations and the
Canadian Secured Obligations.

 

“Secured
Revolving Obligations” means the Secured Obligations other than the U.S.
Term Obligations.

 

“Secured
Parties” has the meaning assigned to such term in the Domestic Security
Agreement.

 

“Security
Agreements” means, collectively, the Domestic Security Agreement, the
Canadian Security Agreement, the U.K. Charge of Shares, the Canadian
Reaffirmation Agreement and any Foreign Security Agreement.

 

“Senior
Secured Notes” means the 11.5% Second-Priority Senior Secured Notes due
2014 issued by the Parent Borrower under the Senior Secured Notes Indenture on
the Effective Date, and any substantially identical second-priority senior
secured notes that are registered under the Securities Act of 1933, as amended,
and issued in exchange for the senior secured notes described in this
definition.

 

“Senior
Secured Notes Documents” means the Senior Secured Notes Indenture, all side
letters, instruments, agreements and other documents evidencing or governing
the Senior Secured Notes, providing for any Guarantee or other right in respect
thereof, affecting the terms of the foregoing or 

 

42

 

entered into in connection therewith and all
schedules, exhibits and annexes to each of the foregoing.

 

“Senior
Secured Notes Indenture” means the Indenture dated as of February 2,
2006, among the Parent Borrower, the Subsidiaries listed therein and U.S. Bank,
National Association, as trustee, in respect of the Senior Secured Notes.

 

“Sponsor”
means Sun Capital Partners, Inc.

 

“Sponsor
Affiliate” means any Affiliate of the Sponsor other than (a) Holdings,
the Parent Borrower and the Subsidiaries and (b) any other operating
company or a Person controlled by such an operating company.

 

“SPV”
has the meaning assigned to such term in Section 9.04(e).

 

“Statutory
Reserve Rate” means a fraction (expressed as a decimal), the numerator of
which is the number one and the denominator of which is the number one minus
the aggregate of the maximum reserve percentages (including any marginal,
special, emergency or supplemental reserves) expressed as a decimal established
by the Board to which the Administrative Agent is subject with respect to
the Adjusted LIBO Rate, for eurocurrency funding (currently referred to as “Eurocurrency
Liabilities” in Regulation D of the Board).  Such reserve percentages shall include those
imposed pursuant to such Regulation D. 
Eurodollar Loans shall be deemed to constitute eurocurrency funding and
to be subject to such reserve requirements without benefit of or credit for
proration, exemptions or offsets that may be available from time to time to any
Lender under such Regulation D or any comparable regulation.  The Statutory Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage.

 

“subsidiary”
means, with respect to any Person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other
entity the accounts of which would be consolidated with those of the parent in
the parent’s consolidated financial statements if such financial statements
were prepared in accordance with GAAP as of such date, as well as any other
corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing
more than 50% of the equity or more than 50% of the ordinary voting power or,
in the case of a partnership, more than 50% of the general partnership
interests are, as of such date, owned, controlled or held, or (b) that is,
as of such date, otherwise Controlled, by the parent or one or more
subsidiaries of the parent or by the parent and one or more subsidiaries of the
parent.

 

“Subsidiary”
means any subsidiary of the Parent Borrower.

 

“Subsidiary
Loan Parties” means, collectively, the Domestic Subsidiary Loan Parties and
the Foreign Subsidiary Loan Parties.

 

“Swap
Agreement” means any agreement with respect to any swap, forward, future or
derivative transaction or option or similar agreement involving, or settled by
reference to, one or more rates, currencies, commodities, equity or debt
instruments or securities, or economic, financial or pricing indices or
measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions, provided that no
phantom stock or similar plan providing for payments only on account of
services provided by current or former directors, officers, employees or
consultants of Holdings, the Parent Borrower or the Subsidiaries shall be a
Swap Agreement.

 

“Swap
Obligations” of a Person means any and all obligations of such Person,
whether absolute or contingent and howsoever and whensoever created, arising,
evidenced or acquired (including 

 

43

 

all renewals, extensions and modifications
thereof and substitutions therefor), under (a) any and all Swap Agreements
and (b) any and all cancellations, buy backs, reversals, terminations or
assignments of any Swap Agreement transaction.

 

“Swingline
Commitment” means the commitment of the Swingline Lender to make Swingline
Loans.

 

“Swingline
Lender” means JPMorgan Chase Bank, N.A., in its capacity as lender of
Swingline Loans hereunder (or, with respect to Swingline Loans made to the
Canadian Subsidiary Borrower, JPMorgan Chase Bank, N.A., Toronto Branch).

 

“Swingline
Loan” means a Loan made pursuant to Section 2.04 and any loan made by
a Swingline Lender pursuant to Section 2.04 of the Original Credit
Agreement that is outstanding on the Restatement Effective Date.

 

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

 

“Term
Commitments” means, collectively, the Initial Term Commitment and any
commitment to make an Incremental Term Loan.

 

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

 

“Term Loans”
means, collectively, the Initial Term Loan and the Incremental Term Loans, if
any.  Each Term Loan shall be an ABR Term
Loan or a Eurodollar Term Loan.

 

“Total
Borrowing Base” means, at any time, the aggregate of the Domestic Borrowing
Base and the Canadian Borrowing Base at such time.

 

“Total L/C
Exposure” means, at any time, the aggregate of the U.S. L/C Exposure and
the U.S. Dollar Equivalent of the Canadian L/C Exposure at such time.

 

“Total
Swingline Exposure” means, at any time, the aggregate of the U.S. Swingline
Exposure and the U.S. Dollar Equivalent of the Canadian Swingline Exposure at
such time.  The Total Swingline Exposure
of any Revolving Lender at any time shall be its Applicable Percentage of the
Total Swingline Exposure at such time.

 

“Transactions”
means, collectively, the Original Transactions and the Restatement
Transactions.

 

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

 

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

 

“U.K.
Charge of Shares” means the U.K. Charge of Shares dated as of February 2,
2006, as amended as of the date hereof (as further amended, amended and
restated, supplemented or modified from time to time in accordance with this Agreement),
among the Canadian Subsidiary Borrower, each 

 

44

 

Subsidiary Loan Party party thereto and the
Administrative Agent.

 

“Unliquidated
Obligations” means, at any time, any Secured Obligations (or portion
thereof) that are contingent in nature or unliquidated at such time, including
any Secured Obligation that is (a) an obligation to reimburse a bank for
drawings not yet made under a letter of credit issued by it, (b) any other
obligation (including any guarantee or indemnity) that is contingent in nature
at such time or (c) an obligation to provide collateral to secure any of
the foregoing types of obligations.

 

“U.S. Base
Rate” means, for any day, the rate of interest per annum equal to the
greater of (a) the interest rate per annum publicly announced from time to
time by the Administrative Agent as its reference rate in effect on such day at
its principal office in Toronto for determining interest rates applicable to
commercial loans denominated in U.S. Dollars in Canada and (b) the Federal
Funds Effective Rate in effect on such day plus 1⁄2 of 1%.  Any change in the U.S. Base Rate due to a
change in such reference rate or the Federal Funds Effective Rate shall be
effective as of the opening of business on the effective day of such change in
the reference rate or the Federal Funds Effective Rate, respectively.

 

“U.S.
Company” means Indalex Inc., a Delaware corporation.

 

“U.S.
Dollar Equivalent” means, on any date of determination, (a) with
respect to any amount in U.S. Dollars, such amount, and (b) with respect
to any amount in Canadian Dollars, the equivalent in U.S. Dollars of such
amount, determined by the Administrative Agent pursuant to Section 1.05
using the Exchange Rate with respect to such currency at that time in effect
under the provisions of such Section.

 

“U.S.
Dollars” or “$” means lawful money of the United States of America.

 

“U.S.
Guaranteed Obligations” has the meaning assigned to such term in Section 10.01(a).

 

“U.S. L/C
Disbursement” means a payment made by the Issuing Bank pursuant to a Letter
of Credit issued for the account of the Parent Borrower or for the account of
any Domestic Subsidiary.

 

“U.S. L/C
Exposure” means, at any time, the sum of (a) the aggregate undrawn
amount of all outstanding Letters of Credit issued for the account of the
Parent Borrower and the Domestic Subsidiaries at such time, plus (b) the
aggregate amount of all U.S. L/C Disbursements that have not yet been
reimbursed (including by the making of Loans hereunder) by or on behalf of the
Parent Borrower and the Domestic Subsidiaries at such time.  The U.S. L/C Exposure of any Lender at any
time shall be its Applicable Percentage of the U.S. L/C Exposure at such time.

 

“U.S.
Lending Office” means, as to any Lender, the applicable branch, office or
Affiliate of such Lender designated by such Lender to make Loans to the Parent
Borrower.

 

“U.S. Loan
Guarantor” means Holdings, each Domestic Subsidiary Loan Party and, with
respect to the Canadian Secured Obligations, the Parent Borrower.

 

“U.S.
Mortgage” means a mortgage, deed of trust, assignment of leases and rents,
leasehold mortgage or other security document (including any amendment,
modification or supplement thereto) granting a Lien on any Mortgaged Property
located in the United States of America or any state thereof to secure the U.S.
Secured Obligations and/or the Canadian Secured Obligations, as the case may
be.  Each U.S. Mortgage shall be
reasonably satisfactory in form and substance to the Administrative 

 

45

 

Agent.

 

“U.S.
Non-Paying Guarantor” has the meaning assigned to such term in Section 10.10(a).

 

“U.S.
Obligations” means, collectively, the U.S. Revolving Obligations and the
U.S. Term Obligations.

 

“U.S. Paying
Guarantor” has the meaning assigned to such term in Section 10.10(a).

 

“U.S.
Revolving Exposure” means, at any time, the sum of (a) the outstanding
principal amount of U.S. Revolving Loans at such time, (b) the U.S. L/C
Exposure at such time and (c) the U.S. Swingline Exposure at such
time.  The U.S. Revolving Exposure of any
Revolving Lender at any time shall be such Lender’s Applicable Percentage of
the U.S. Revolving Exposure at such time.

 

“U.S.
Revolving Loan” means a Loan made by a Revolving Lender pursuant to Section 2.01(a) and
any loan made by a Revolving Lender pursuant to Section 2.01(a) of
the Original Credit Agreement that is outstanding on the Restatement Effective
Date.  Each U.S. Revolving Loan shall be
an ABR Revolving Loan or a Eurodollar Revolving Loan.

 

“U.S.
Revolving Obligations” means (a) all unpaid principal of and accrued
and unpaid interest on the Revolving Loans and Swingline Loans made to the
Parent Borrower (including all interest accrued or accruing (or which would,
absent commencement of an Insolvency or Liquidation Proceeding, accrue) after
commencement of an Insolvency or Liquidation Proceeding in accordance with the
rate specified in this Agreement, whether or not the claim for such interest is
allowed as a claim in such Insolvency or Liquidation Proceeding), (b) all
U.S. L/C Exposure in respect of Letters of Credit issued for the account of the
Parent Borrower and the Domestic Subsidiaries and (c) all accrued and
unpaid fees and all expenses, reimbursements, indemnities and other obligations
of Holdings, the Parent Borrower and the Domestic Subsidiary Loan Parties owed
to the Revolving Lenders or to any Revolving Lender, the Administrative Agent,
the Issuing Bank or any Related Party of any of the foregoing arising under the
Loan Documents (including the Guarantees provided by the U.S. Loan Guarantors
pursuant to Article X in respect of such obligations).

 

“U.S.
Secured Obligations” means all U.S. Obligations, together with (a) Banking
Services Obligations of Holdings, the Parent Borrower and the Domestic
Subsidiary Loan Parties and (b) Swap Obligations entered into by Holdings,
the Parent Borrower and the Domestic Subsidiary Loan Parties owing to one or
more Revolving Lenders or their respective Affiliates (including any such Swap
Obligations set forth on Schedule 1.06), provided that, solely with
respect to any Swap Obligation arising on or after the Restatement Effective
Date, at or prior to the time that any transaction relating to any such Swap
Obligation is executed, the Revolving Lender or applicable Affiliate, in each
case party thereto (other than JPMorgan Chase Bank, N.A. or any of its
Affiliates) shall have delivered written notice to the Administrative Agent
that such a transaction has been or will be entered into and that it
constitutes a Secured Obligation entitled to the benefits of the Collateral
Documents.

 

“U.S.
Swingline Exposure” means, at any time, the aggregate principal amount of
all Swingline Loans made to the Parent Borrower at such time.  The U.S. Swingline Exposure of any Revolving
Lender at any time shall be its Applicable Percentage of the U.S. Swingline
Exposure at such time.

 

“U.S. Term
Obligations” means (a) all unpaid principal of and accrued and unpaid
interest on the Term Loans made to the Parent Borrower and (b) all accrued
and unpaid fees and all expenses, reimbursements, indemnities and other
obligations of Holdings, the Parent Borrower and the 

 

46

 

Domestic Subsidiary Loan Parties owed to the
Term Lenders or to any Term Lender or to any Related Party of any Term Lender
arising under the Loan Documents (including the Guarantees provided by the U.S.
Loan Guarantors pursuant to Article X in respect of such obligations).

 

“wholly-owned
subsidiary” means, with respect to any Person at any date, a subsidiary of
such Person of which securities or other ownership interests representing 100%
of the Equity Interests (other than directors’ qualifying shares) are, as of
such date, owned, controlled or held by such Person or one or more wholly-owned
Subsidiaries of such Person or by such Person and one or more wholly-owned
Subsidiaries of such Person.  For
purposes of this Agreement, “wholly-owned Subsidiary” means a direct or
indirect wholly-owned subsidiary of the Parent Borrower.

 

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

 

SECTION 1.02.  Classification of Loans and Borrowings.  For purposes of this Agreement, (a) Loans
may be classified and referred to by Class (e.g., a “U.S. Revolving
Loan”) or by Type (e.g., a “Eurodollar Loan”) or by Class and Type
(e.g., a “Eurodollar U.S. Revolving Loan”), and Borrowings also may be
classified and referred to by Class (e.g., a “U.S. Revolving
Borrowing”) or by Type (e.g., a “Eurodollar Borrowing”) or by Class and
Type (e.g., a “Eurodollar U.S. Revolving Borrowing”) and (b) “Revolving
Borrowings” means the U.S. Revolving Borrowings, the Canadian Revolving
Borrowings or both, as the context may require.

 

SECTION 1.03.  Terms Generally.  The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun
shall include the corresponding masculine, feminine and neuter forms.  The words “include”, “includes” and “including”
shall be deemed to be followed by the phrase “without limitation”.  The word “will” shall be construed to have
the same meaning and effect as the word “shall”.  Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document
herein shall be construed as referring to such agreement, instrument or other
document as from time to time amended, amended and restated, supplemented or
otherwise modified (subject to any restrictions on such amendments, supplements
or modifications set forth herein), (b) any reference herein to any Person
shall be construed to include such Person’s successors and assigns, (c) the
words “herein”, “hereof” and “hereunder”, and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular
provision hereof, (d) all references herein to Articles, Sections,
Exhibits and Schedules shall be construed to refer to Articles and Sections of,
and Exhibits and Schedules to, this Agreement, (e) the words “asset” and “property”
shall be construed to have the same meaning and effect and to refer to any and
all tangible and intangible assets and properties, including cash, securities,
accounts and contract rights and (f) any reference to any Requirement of
Law shall, unless otherwise specified, refer to such Requirement of Law as
amended, modified or supplemented from time to time.

 

SECTION 1.04.  Accounting Terms; GAAP.  Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time, consistently applied, provided
that if the Parent Borrower notifies the Administrative Agent that the Parent
Borrower requests an amendment to any provision hereof (including any defined
term) to eliminate the effect of any change occurring after the date hereof in
GAAP or in the application thereof on the operation of such provision (or if
the Administrative Agent notifies the Parent Borrower that the Required Lenders
request an amendment to any provision (including any definition) hereof for
such purpose), regardless of whether any such notice is given before or after
such change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall 

 

47

 

have been
withdrawn or such provision amended in accordance herewith.  Upon any such request for an amendment, the
Parent Borrower, the Required Lenders and the Administrative Agent agree to
consider in good faith any such amendment in order to amend the provisions of
this Agreement so as to reflect equitably such accounting changes so that the
criteria for evaluating the Parent Borrower’s financial condition shall be the
same after such accounting changes as if such accounting changes had not
occurred.  In no event shall any capital
stock be deemed to constitute Indebtedness or any payment of any dividend or
distribution thereon be deemed to constitute interest solely as a result of the
application of Financial Accounting Standards No. 150.

 

SECTION 1.05.  Currency Translation.  (a)  Except as specifically provided in
clause (b) of this Section 1.05, for purposes of determining
compliance as of any date with the terms of any Loan Document (other than the
limits and sublimits for Revolving Exposure set forth in Article II of
this Agreement), amounts incurred or outstanding in Canadian Dollars shall be
translated into U.S. Dollars at the exchange rates in effect on the first
Business Day of the fiscal quarter in which such determination occurs or in
respect of which such determination is being made, as such exchange rates shall
be determined in good faith by the Parent Borrower.  No Default or Event of Default shall arise as
a result of any limitation or threshold set forth in U.S. Dollars in any Loan
Document (other than the limits and sublimits for Revolving Exposure set forth
in Article II of this Agreement) being exceeded solely as a result of
changes in currency exchange rates from those rates applicable on the first day
of the fiscal quarter in which such determination occurs or in respect of which
such determination is being made.

 

(b)  (i)The Administrative Agent shall determine
the U.S. Dollar Equivalent of any Letter of Credit denominated in Canadian
Dollars, as well as of each component of the Domestic Borrowing Base and the
Canadian Borrowing Base, as of each date (with such date to be reasonably
determined by the Administrative Agent) that is on or about the date of each
request for the issuance, amendment, renewal or extension of such Letter of
Credit, using the Exchange Rate for the applicable currency in relation to U.S.
Dollars in effect on the date of determination, and each such amount shall be
the U.S. Dollar Equivalent of such Letter of Credit (or such Domestic Borrowing
Base component or Canadian Borrowing Base component, as the case may be) until
the next required calculation thereof pursuant to this paragraph (b)(i) (or,
in the case of such Domestic Borrowing Base component or Canadian Borrowing
Base component, pursuant to paragraph (b)(ii) or (b)(v)) of this Section 1.05.

 

(ii) The Administrative Agent
shall determine the U.S. Dollar Equivalent of any Borrowing denominated in
Canadian Dollars or any B/A accepted and purchased under Section 2.06, as
well as of each component of the Domestic Borrowing Base and the Canadian
Borrowing Base, as of each date (with such date to be reasonably determined by
the Administrative Agent) that is on or about the date of a Borrowing Request,
Interest Election Request or request for an acceptance and purchase of B/As
with respect to any such Borrowing or B/A, or as of each date of any
termination or reduction of Commitments hereunder or the prepayment of Loans
hereunder, in each case using the Exchange Rate for the applicable currency in
relation to U.S. Dollars in effect on the date of determination, and each such
amount shall be the U.S. Dollar Equivalent of such Borrowing or B/A (or such
Domestic Borrowing Base component or Canadian Borrowing Base component, as the
case may be) until the next required calculation thereof pursuant to this
paragraph (b)(ii) (or, in the case of such Domestic Borrowing Base
component or Canadian Borrowing Base component, pursuant to paragraph (b)(i) or
(b)(v)) of this Section 1.05.

 

(iii) The U.S. Dollar
Equivalent of any Canadian L/C Disbursement made by the Issuing Bank in
Canadian Dollars and not reimbursed by the Canadian Subsidiary Borrower shall
be determined as set forth in paragraphs (e) or (k) of Section 2.05,
as applicable.  In addition, the 

 

48

 

U.S. Dollar Equivalent of the Canadian L/C
Exposure shall be determined as set forth in paragraph (k) of Section 2.05,
at the time and in the circumstances specified therein.

 

(iv) The Administrative
Agent shall notify the Borrowers, the applicable Lenders and the Issuing Bank
of each calculation of the U.S. Dollar Equivalent of each Letter of Credit,
Borrowing, B/A accepted and purchased hereunder and L/C Disbursement.

 

(v) In addition to the
requirements set forth in paragraphs (b)(i) and (b)(ii) of this Section 1.05,
the Administrative Agent shall determine the U.S. Dollar Equivalent of each
applicable component of the Domestic Borrowing Base and the Canadian Borrowing
Base as of each date (with such date to be reasonably determined by the
Administrative Agent) that is on or about the date of delivery of each
Borrowing Base Certificate hereunder, in each case using the Exchange Rate for
the applicable currency in relation to U.S. Dollars in effect on the date of
determination, and each such amount shall be the U.S. Dollar Equivalent of such
Domestic Borrowing Base component or Canadian Borrowing Base component until
the next required calculation thereof pursuant to paragraph (b)(i), (b)(ii) or
(b)(v) of this Section 1.05.

 

ARTICLE II

 

The Credits

 

SECTION 2.01.  Commitments.  Subject to the terms and conditions set forth
herein,

 

(a)  each
Revolving Lender agrees to make U.S. Revolving Loans to the Parent Borrower in
U.S. Dollars, from time to time during the Availability Period, in an aggregate
principal amount that will not result in (i) such Lender’s Revolving
Exposure exceeding such Lender’s Revolving Commitment, (ii) the U.S.
Revolving Exposure exceeding the Domestic Borrowing Base then in effect or (iii) the
aggregate Revolving Exposure exceeding the lesser of (A) the aggregate
Revolving Commitments and (B) an amount equal to (x) the Total
Borrowing Base then in effect minus (y) the Availability Block;

 

(b)  each
Revolving Lender agrees to make Canadian Revolving Loans to the Canadian
Subsidiary Borrower in Canadian Dollars and/or U.S. Dollars and/or to accept
and purchase, or arrange for the acceptance and purchase of, drafts drawn by
the Canadian Subsidiary Borrower in Canadian Dollars as B/As, from time to time
during the Availability Period, in an aggregate principal amount that will not
result in (i) such Lender’s Canadian Revolving Exposure exceeding such
Lender’s Canadian Revolving Sub-Commitment, (ii) such Lender’s Revolving
Exposure exceeding such Lender’s Revolving Commitment, (iii) the Canadian
Revolving Exposure exceeding the lesser of (A) the aggregate Canadian
Revolving Sub-Commitments and (B) the Canadian Borrowing Base then in
effect or (iv) the aggregate Revolving Exposure exceeding the lesser of (A) the
aggregate Revolving Commitments and (B) an amount equal to (x) the
Total Borrowing Base then in effect minus (y) the Availability
Block; and

 

(c)  the
Initial Term Lender agrees to make a Term Loan to the Parent Borrower in U.S.
Dollars in an aggregate principal amount that will not exceed the Initial Term
Commitment.

 

Within the foregoing limits and
subject to the terms and conditions set forth herein, the Borrowers may borrow,
prepay and reborrow Revolving Loans. 
Amounts repaid or prepaid in respect of Term Loans may not be
reborrowed.  All Revolving Loans and B/As
outstanding under the Original Credit Agreement on the Restatement Effective
Date shall remain outstanding hereunder on the terms set forth herein.

 

SECTION 2.02.  Loans and Borrowings.  (a)  Each Loan (other than a Swingline
Loan) shall be made as part of a Borrowing consisting of Loans of the same Class and
Type made by the 

 

49

 

Lenders (i) in
the case of U.S. Revolving Borrowings, ratably in accordance with their
respective Revolving Commitments as of the date of borrowing, (ii) in the
case of Canadian Revolving Borrowings, ratably in accordance with their
respective Canadian Revolving Sub-Commitments as of the date of borrowing, and (iii) in
the case of Term Borrowings, ratably in accordance with their respective Term
Commitments as of the date of borrowing. 
Any Swingline Loan shall be made in accordance with the procedures set
forth in Section 2.04.  Any failure
of any Lender to make any Loan required to be made by it shall not relieve any
other Lender of its obligations hereunder, provided that each of the
Revolving Commitments, Canadian Revolving Sub-Commitments and Term Commitments
of the Lenders are several and no Lender shall be responsible for any other
Lender’s failure to make Loans as required.

 

(b) 
Subject to Section 2.14, (i) each U.S. Revolving Borrowing shall be
comprised entirely of ABR Revolving Loans or Eurodollar Revolving Loans as the
Parent Borrower may request in accordance herewith, (ii) each Canadian
Revolving Borrowing (A) denominated in U.S. Dollars shall be comprised
entirely of U.S. Base Rate Revolving Loans or Eurodollar Revolving Loans, as
the Canadian Subsidiary Borrower may request in accordance herewith, and (B) denominated
in Canadian Dollars shall be comprised entirely of Canadian Base Rate Revolving
Loans, and (iii) each Term Borrowing shall be comprised entirely of ABR
Term Loans or Eurodollar Term Loans as the Parent Borrower may request in
accordance herewith.  Each Swingline Loan
(x) made to the Parent Borrower shall be an ABR Loan and (y) made to
the Canadian Subsidiary Borrower and denominated in (1) U.S. Dollars shall
be a U.S. Base Rate Loan and (2) Canadian Dollars shall be a Canadian Base
Rate Loan.  Subject to Section 2.19,
each Lender at its option may make any Eurodollar Loan by causing any domestic
or foreign branch or Affiliate of such Lender to make such Loan, provided
that any exercise of such option shall not affect the obligation of the
applicable Borrower to repay such Loan in accordance with the terms of this
Agreement.

 

(c)  At
the commencement of each Interest Period for any Eurodollar Borrowing, such
Borrowing shall be in an aggregate amount that is an integral multiple of
$1,000,000 and not less than $5,000,000. 
At the time that (i) each ABR Borrowing is made, such Borrowing
shall be in an aggregate amount that is an integral multiple of $500,000 and
not less than $1,000,000, (ii) each U.S. Base Rate Revolving Borrowing is
made, such Borrowing shall be in an aggregate amount that is an integral
multiple of $500,000 and not less than $1,000,000, and (iii) each Canadian
Base Rate Revolving Borrowing is made, such Borrowing shall be in an aggregate
amount that is an integral multiple of C$500,000 and not less than
C$1,000,000.  Each Swingline Loan shall
be in an amount that is an integral multiple of (x) in the case of
Swingline Loans denominated in U.S. Dollars, $250,000 and not less than $500,000
and (y) in the case of Swingline Loans denominated in Canadian Dollars,
C$250,000 and not less than C$500,000. 
Borrowings of more than one Class and Type may be outstanding at
the same time, provided that there shall not at any time be more than a
total of eight Eurodollar Borrowings outstanding.  Notwithstanding anything to the contrary
herein, (A) an ABR Revolving Borrowing or a Swingline Loan made to the
Parent Borrower may be in an aggregate amount that is equal to the entire
unused balance of the aggregate Revolving Commitments or that is required to
finance the reimbursement of an L/C Disbursement as contemplated by Section 2.05(e) and
(B) a U.S. Base Rate Revolving Borrowing, Canadian Base Rate Revolving
Borrowing or a Swingline Loan made to the Canadian Subsidiary Borrower may be
in an aggregate amount which is equal to (or, in the case of a Canadian Base
Rate Revolving Borrowing or a Swingline Loan denominated in Canadian Dollars,
the U.S. Dollar Equivalent of which is equal to) the entire unused balance of
the aggregate Canadian Revolving Sub-Commitments or that is required to finance
the reimbursement of an L/C Disbursement as contemplated by Section 2.05(e).

 

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

 

50

 

SECTION 2.03.  Requests for Borrowings.  To request a Borrowing, the applicable
Borrower shall notify the Administrative Agent of such request either in
writing (delivered by hand or facsimile) in a form approved by the
Administrative Agent and signed by the applicable Borrower or by telephone (a) in
the case of a Eurodollar Borrowing, not later than 12:00 noon, Local Time,
three Business Days before the date of the proposed Borrowing, (b) in the
case of an ABR Borrowing, not later than 12:00 noon, New York City time, one
Business Day before the date of the proposed Borrowing, provided that
any such notice of an ABR Revolving Borrowing to finance the reimbursement of
an L/C Disbursement as contemplated by Section 2.05(e) may be given
not later than 11:00 a.m., New York City time, on the date of the proposed
Borrowing, (c) in the case of a Canadian Base Rate Revolving Borrowing,
not later than 12:00 p.m., Toronto time, one Business Day before the date
of the proposed borrowing, provided any such notice of a Canadian Base
Rate Revolving Borrowing to finance the reimbursement of an L/C Disbursement as
contemplated by Section 2.05(e) may be given not later than 11:00 a.m.,
Toronto time, on the date of the proposed Borrowing, and (d) in the case
of a U.S. Base Rate Revolving Borrowing, not later than 12:00 noon, Toronto
time, one Business Day before the date of the proposed Borrowing.  Each such Borrowing Request shall be
irrevocable and, if telephonic, shall be confirmed promptly by hand delivery or
facsimile to the Administrative Agent of a written Borrowing Request in a form
approved by the Administrative Agent and signed by the applicable
Borrower.  Each such written and
telephonic Borrowing Request shall specify the following information:

 

(i) the Borrower requesting such
Borrowing;

 

(ii) whether such Borrowing is to be a
U.S. Revolving Borrowing, a Canadian Revolving Borrowing or a Term Borrowing;

 

(iii) the currency and aggregate amount
of such Borrowing;

 

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

 

(v) whether such Borrowing is to be an
ABR Borrowing, U.S. Base Rate Revolving Borrowing, Canadian Base Rate Revolving
Borrowing or Eurodollar Borrowing;

 

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

 

(vii) the location and number of the
applicable Borrower’s account to which funds are to be disbursed, which shall
comply with the requirements of Section 2.07; and

 

(viii) that as of such date Section 4.02(a) is
satisfied.

 

If no election as to the Type of Borrowing is
specified, then the requested Borrowing shall be (A) in the case of a U.S.
Revolving Borrowing, an ABR Revolving Borrowing, (B) in the case of a Canadian
Revolving Borrowing, a Canadian Base Rate Revolving Borrowing, and (C) in
the case of a Term Borrowing, an ABR Term Borrowing.  If no Interest Period is specified with
respect to any requested Eurodollar Borrowing, then the applicable Borrower
shall be deemed to have selected an Interest Period of one month’s
duration.  Promptly following receipt of
a Borrowing Request in accordance with this Section 2.03, the
Administrative Agent shall advise each Lender of the details thereof and the
amount of such Lender’s Loan to be made as part of the requested
Borrowing.  If no currency is specified
with respect to any Canadian Revolving Borrowing, then the currency of such
Canadian Revolving Borrowing shall be Canadian Dollars (unless the applicable
Borrowing Request otherwise specified that such Borrowing shall be a U.S. Base
Rate Canadian Revolving Borrowing or a Eurodollar Canadian Revolving

 

51

 

Borrowing, in which case the currency of such
Canadian Revolving Borrowing shall be U.S. Dollars).

 

SECTION 2.04.  Swingline Loans.  (a)  Subject to the terms and conditions
set forth herein, the Swingline Lender agrees to make Swingline Loans to the
Parent Borrower and the Canadian Subsidiary Borrower, from time to time during
the Availability Period, in an aggregate principal amount at any time
outstanding that will not result in (i) the U.S. Dollar Equivalent of the
aggregate principal amount of outstanding Swingline Loans exceeding $5,000,000,
(ii) the U.S. Revolving Exposure exceeding the Domestic Borrowing Base
then in effect, (iii) the Canadian Revolving Exposure exceeding the lesser
of (A) the aggregate Canadian Revolving Sub-Commitments and (B) the
Canadian Borrowing Base then in effect or (iv) the aggregate Revolving
Exposure exceeding the lesser of (A) the aggregate Revolving Commitments
and (B) an amount equal to (x) the Total Borrowing Base then in
effect minus (y) the Availability Block, provided that the
Swingline Lender shall not be required to make a Swingline Loan to refinance an
outstanding Swingline Loan.  Within the
foregoing limits and subject to the terms and conditions set forth herein, the
Parent Borrower may borrow, prepay and reborrow Swingline Loans.  All Swingline Loans outstanding under the
Original Credit Agreement on the Restatement Effective Date shall remain
outstanding hereunder on the terms set forth herein.

 

(b)  To request a
Swingline Loan, the applicable Borrower shall notify the Administrative Agent
of such request by telephone (confirmed by facsimile) not later than 12:00
noon, Local Time, on the day of a proposed Swingline Loan.  Each such telephonic request shall be
irrevocable and shall specify the requested date (which shall be a Business
Day) and amount of the requested Swingline Loan.  The Administrative Agent will promptly advise
the Swingline Lender of any such request received from the applicable
Borrower.  The Swingline Lender shall
make each Swingline Loan available to the applicable Borrower by means of a
credit to the applicable Funding Account (or, in the case of a Swingline Loan
made to finance the reimbursement of an L/C Disbursement as provided in Section 2.05(e),
by remittance to the Issuing Bank or, to the extent that the Revolving Lenders
have made payments pursuant to Section 2.05(e) to reimburse the
Issuing Bank, to such Lenders and the Issuing Bank as their interests may
appear, or, in the case of repayment of another Loan or fees or expenses as
provided by Section 2.18(c), by remittance to the Administrative Agent to
be distributed to the Lenders) by 3:00 p.m., Local Time, on the requested
date of such Swingline Loan.

 

(c)  The Swingline
Lender may by written notice given to the Administrative Agent not later than
12:00 noon, Local Time, on any Business Day, require the Revolving Lenders to
acquire participations on such Business Day in all or a portion of the
Swingline Loans outstanding.  Such notice
shall specify the aggregate amount of Swingline Loans in which Revolving Lenders
will participate.  Promptly upon receipt
of such notice, the Administrative Agent will give notice thereof to each
Revolving Lender, specifying in such notice such Lender’s Applicable Percentage
of such Swingline Loan or Loans.  Each
Revolving Lender hereby absolutely and unconditionally agrees, upon receipt of
notice as provided above, to pay to the Administrative Agent, for the account
of the Swingline Lender, such Lender’s Applicable Percentage of such Swingline
Loan or Loans.  Each Revolving Lender
acknowledges and agrees that its obligation to acquire participations in
Swingline Loans pursuant to this paragraph is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including the occurrence
and continuance of a Default or reduction or termination of the Commitments,
and that each such payment shall be made without any offset, abatement,
withholding or reduction whatsoever. 
Each Revolving Lender shall comply with its obligation under this
paragraph by wire transfer of immediately available funds, in the same manner
as provided in Section 2.07 with respect to Loans made by such Lender (and
Section 2.07 shall apply, mutatis  mutandis, to the payment
obligations of the Revolving Lenders), and the Administrative Agent shall
promptly pay to the Swingline Lender the amounts so received by it from the
Revolving Lenders.  The Administrative
Agent shall notify the applicable Borrower of any participations in any
Swingline Loan acquired pursuant to this paragraph and, thereafter, payments in
respect of such Swingline Loan shall be made to the Administrative Agent and
not to the 

 

52

 

Swingline Lender.  Any amounts received by the Swingline Lender
from a Borrower (or other party on behalf of such Borrower) in respect of a
Swingline Loan after receipt by the Swingline Lender of the proceeds of a sale
of participations therein shall be promptly remitted to the Administrative
Agent; any such amounts received by the Administrative Agent shall be promptly
remitted by the Administrative Agent to the Revolving Lenders that shall have
made their payments pursuant to this paragraph and to the Swingline Lender, as
their interests may appear, provided that any such payment so remitted
shall be repaid to the Swingline Lender or to the Administrative Agent, as
applicable, if and to the extent such payment is required to be refunded to
such Borrower for any reason.  The
purchase of participations in a Swingline Loan pursuant to this paragraph shall
not relieve the applicable Borrower of any default in the payment thereof.

 

SECTION 2.05.  Letters of Credit.  (a)  General.  Upon satisfaction of the conditions specified
in Section 4.01 on the Restatement Effective Date, each Existing Letter of
Credit will, automatically and without any action on the part of any Person, be
deemed to be a Letter of Credit issued hereunder for all purposes of this
Agreement and the other Loan Documents. 
Subject to the terms and conditions set forth herein, at any time and from
time to time during the Availability Period, (i) each Borrower may request
the issuance of Letters of Credit for its own account, (ii) the Parent
Borrower may request the issuance of Letters of Credit for the account of any
Domestic Subsidiary (so long as the Parent Borrower and such Domestic
Subsidiary are co-applicants in respect of such Letter of Credit) and (iii) the
Canadian Subsidiary Borrower may request the issuance of Letters of Credit for
the account of any Foreign Subsidiary (so long as the Canadian Subsidiary
Borrower and such Foreign Subsidiary are co-applicants in respect of such
Letter of Credit), in each case, in a form reasonably acceptable to the
Administrative Agent and the Issuing Bank. 
All Letters of Credit issued shall be denominated in (A) U.S.
Dollars, in the case of Letters of Credit issued for the account of the Parent
Borrower or any Domestic Subsidiary, and (B) Canadian Dollars, in the case
of Letters of Credit issued for the account of the Canadian Subsidiary Borrower
or any Foreign Subsidiary.  In the event
of any inconsistency between the terms and conditions of this Agreement and the
terms and conditions of any form of letter of credit application or other
agreement submitted by the applicable Borrower or Subsidiary to, or entered
into by the applicable Borrower or Subsidiary with, the Issuing Bank relating
to any Letter of Credit, the terms and conditions of this Agreement shall
control.

 

(b)  Notice of
Issuance, Amendment, Renewal, Extension; Certain Conditions.  To request the issuance of a Letter of Credit
(or the amendment, renewal or extension of an outstanding Letter of Credit),
the applicable Borrower (and, as applicable, Subsidiary) shall hand deliver or
facsimile (or transmit by electronic communication, if arrangements for doing
so have been approved by the Issuing Bank) to the Issuing Bank and the
Administrative Agent (reasonably in advance of the requested date of issuance,
amendment, renewal or extension) a notice (i) requesting the issuance of a
Letter of Credit or identifying the Letter of Credit to be amended, renewed or
extended, (ii) specifying the date of such issuance, amendment, renewal or
extension (which shall be a Business Day), (iii) the date on which such
Letter of Credit is to expire (which shall comply with paragraph (c) of
this Section 2.05), (iv) the amount of such Letter of Credit, (v) the
name and address of the beneficiary thereof and (vi) such other
information as shall be necessary to prepare, issue, amend, renew or extend
such Letter of Credit.  The applicable
Borrower (and, as applicable, Subsidiary) shall also submit a letter of credit
application on the Issuing Bank’s standard form in connection with any request
for the issuance of a Letter of Credit. 
A Letter of Credit shall be issued, amended, renewed or extended only if
(and, upon issuance, amendment, renewal or extension of each Letter of Credit,
the applicable Borrower (and, as applicable, Subsidiary) shall be deemed to
represent and warrant that), after giving effect to such issuance, amendment,
renewal or extension (A) the Total L/C Exposure shall not exceed
$30,000,000, (B) the aggregate Revolving Exposure shall not exceed the
lesser of (1) the aggregate Revolving Commitments and (2) an amount
equal to (x) the Total Borrowing Base then in effect minus (y) the
Availability Block, (C) in respect of Letters of Credit issued for the
account of the Parent Borrower or any Domestic Subsidiary, the U.S. 

 

53

 

Revolving Exposure shall not
exceed the Domestic Borrowing Base then in effect, and (D) in respect of
Letters of Credit issued for the account of the Canadian Subsidiary Borrower or
any Foreign Subsidiary, the Canadian Revolving Exposure shall not exceed the
lesser of (1) the aggregate Canadian Revolving Sub-Commitments and (2) the
Canadian Borrowing Base then in effect.

 

(c)  Expiration
Date.  Each Letter of Credit shall
expire at or prior to the close of business on the earlier of (i) the date
that is one year after the date of the issuance of such Letter of Credit (or,
in the case of any renewal or extension thereof (including any automatic
renewal or extension), one year after such renewal or extension) and (ii) the
date that is five Business Days prior to the Maturity Date, provided
that a Letter of Credit may, upon the request of the applicable Borrower (or,
as applicable, Subsidiary), include a provision whereby such Letter of Credit
shall be renewed automatically for additional consecutive periods of one year
or less (but not beyond the date that is five Business Days prior to the
Maturity Date) unless the Issuing Bank notifies the beneficiary thereof at
least 30 days (or such longer period as the Administrative Agent and the
Issuing Bank shall approve) prior to the then-applicable expiration date that
such Letter of Credit will not be renewed, and provided  further
that a Letter of Credit may, upon the request of the applicable Borrower (and,
as applicable, Subsidiary) and subject to the consent of the Issuing Bank,
acting in its sole discretion, be renewed for a period beyond the date that is
five Business Days prior to the Maturity Date on terms and conditions
acceptable to the Issuing Bank (for purposes of clarity, no Revolving Lender
will be required to acquire a participation in such Letter of Credit after the
Maturity Date).

 

(d)  Participations.  By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) for the account
of the Parent Borrower, the Canadian Subsidiary Borrower or any Subsidiary and
without any further action on the part of the Issuing Bank or the Lenders, the
Issuing Bank hereby grants to each Revolving Lender, and each Revolving Lender
hereby acquires from the Issuing Bank, a participation in such Letter of Credit
equal to such Lender’s Applicable Percentage of the aggregate amount available
to be drawn under such Letter of Credit. 
In consideration and in furtherance of the foregoing, (i) each
Revolving Lender hereby absolutely and unconditionally agrees to pay to the
Administrative Agent, for the account of the Issuing Bank, such Lender’s
Applicable Percentage of each U.S. L/C Disbursement made by the Issuing Bank
and not reimbursed by the Parent Borrower or applicable Domestic Subsidiary on
the date due as provided in paragraph (e) of this Section 2.05 or of
any reimbursement payment required to be refunded to the Parent Borrower or
applicable Domestic Subsidiary for any reason and (ii) each Revolving
Lender hereby absolutely and unconditionally agrees to pay to the
Administrative Agent, for the account of the Issuing Bank, such Lender’s
Applicable Percentage of each Canadian L/C Disbursement made by the Issuing
Bank and not reimbursed by the Canadian Subsidiary Borrower or applicable
Foreign Subsidiary on the date due as provided in paragraph (e) of this Section 2.05
or of any reimbursement payment required to be refunded to the Canadian
Subsidiary Borrower or applicable Foreign Subsidiary for any reason.  Each Revolving Lender acknowledges and agrees
that its obligation to acquire participations pursuant to this paragraph in
respect of Letters of Credit is absolute and unconditional and shall not be
affected by any circumstance whatsoever, including any amendment, renewal or
extension of any Letter of Credit or the occurrence and continuance of a
Default or reduction or termination of the Commitments, and that each such
payment shall be made without any offset, abatement, withholding or reduction
whatsoever.

 

(e)  Reimbursement.  If the Issuing Bank shall make any L/C
Disbursement in respect of a Letter of Credit, the applicable Borrower or
Subsidiary shall reimburse such L/C Disbursement by paying to the
Administrative Agent an amount equal to such L/C Disbursement not later than
3:00 p.m., Local Time, on the date that such L/C Disbursement is made, if
the applicable Borrower or Subsidiary shall have received notice of such L/C
Disbursement prior to 10:00 a.m., Local Time, on such date, or, if such
notice has not been received by the applicable Borrower or Subsidiary prior to
such time on such date, then not later than (i) 3:00 p.m., Local
Time, on the Business Day that the applicable Borrower or 

 

54

 

Subsidiary receives such
notice, if such notice is received prior to 10:00 a.m., Local Time, on the
day of receipt, or (ii) 12:00 noon, Local Time, on the Business Day
immediately following the day that the applicable Borrower or Subsidiary
receives such notice, if such notice is not received prior to 10:00 a.m.,
Local Time, on the day of receipt, provided that, if such L/C
Disbursement is not less than $500,000, the applicable Borrower or Subsidiary
may, subject to the conditions to borrowing set forth herein, request in
accordance with Section 2.03 or 2.04 that such payment be financed with (A) in
the case of a Letter of Credit issued for the account of the Parent Borrower or
any Domestic Subsidiary, an ABR Revolving Borrowing or Swingline Loan made to
the Parent Borrower, or (B) in the case of a Letter of Credit issued for
the account of the Canadian Subsidiary Borrower or any Foreign Subsidiary, a
Canadian Base Rate Revolving Loan or a Swingline Loan made to the Canadian
Subsidiary Borrower and denominated in Canadian Dollars, in each case, in an
equivalent amount and, to the extent so financed, the obligation of the
applicable Borrower or Subsidiary to make such payment shall be discharged and
replaced by the resulting ABR Revolving Borrowing, Canadian Base Rate Revolving
Borrowing or Swingline Loan, as the case may be.  If the applicable Borrower or Subsidiary
fails to make such payment when due, the Administrative Agent shall notify each
Revolving Lender of the applicable L/C Disbursement, the payment then due from
the applicable Borrower or Subsidiary in respect thereof and such Lender’s
Applicable Percentage thereof.  Promptly
following receipt of such notice, each Revolving Lender shall pay to the
Administrative Agent its Applicable Percentage of the payment then due from the
applicable Borrower or Subsidiary, in the same manner as provided in Section 2.07
with respect to Loans made by such Lender (and Section 2.07 shall apply
(other than with respect to any time limits set forth therein), mutatis  mutandis,
to the payment obligations of the Revolving Lenders), and the Administrative
Agent shall promptly pay to the Issuing Bank the amounts so received by it from
the Revolving Lenders.  Promptly
following receipt by the Administrative Agent of any payment from the
applicable Borrower or Subsidiary pursuant to this paragraph, the
Administrative Agent shall distribute such payment to the Issuing Bank or, to
the extent that Revolving Lenders have made payments pursuant to this paragraph
to reimburse the Issuing Bank, then to such Lenders and the Issuing Bank as
their interests may appear.  Any payment
made by a Revolving Lender pursuant to this paragraph to reimburse the Issuing
Bank for any L/C Disbursement (other than the funding of ABR Revolving Loans,
Canadian Base Rate Revolving Loans or Swingline Loans as contemplated above)
shall not constitute a Loan and shall not relieve the applicable Borrower or
Subsidiary of its obligation to reimburse such L/C Disbursement.

 

(f)  Obligations
Absolute.  The applicable Borrower or
Subsidiary’s obligation to reimburse L/C Disbursements as provided in
paragraph (e) of this Section 2.05 shall be absolute,
unconditional and irrevocable and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter
of Credit or this Agreement or any term or provision therein or herein, (ii) any
draft or other document presented under a Letter of Credit proving to be
forged, fraudulent or invalid in any respect or any statement therein being
untrue or inaccurate in any respect, (iii) payment by the Issuing Bank
under a Letter of Credit against presentation of a draft or other document that
does not comply with the terms of such Letter of Credit or (iv) any other
event or circumstance whatsoever, whether or not similar to any of the
foregoing, that might, but for the provisions of this Section 2.05,
constitute a legal or equitable discharge of, or provide a right of setoff
against, the obligations of the applicable Borrower or Subsidiary
hereunder.  Neither the Administrative
Agent, the Lenders nor the Issuing Bank, nor any of their Related Parties,
shall have any liability or responsibility by reason of or in connection with
the issuance or transfer of any Letter of Credit or any payment or failure to
make any payment thereunder (irrespective of any of the circumstances referred
to in the preceding sentence) or any error, omission, interruption, loss or
delay in transmission or delivery of any draft, notice or other communication
under or relating to any Letter of Credit (including any document required to
make a drawing thereunder), any reasonable error in interpretation of technical
terms or any consequence arising from causes beyond the control of the Issuing
Bank, provided that the foregoing shall not be construed to excuse the
Issuing Bank from liability to the applicable Borrower or Subsidiary to the
extent of any direct damages (as opposed to 

 

55

 

consequential damages,
claims in respect of which are hereby waived by such Borrower or Subsidiary to
the extent permitted by applicable law) suffered by the such Borrower or
Subsidiary that are caused by the Issuing Bank’s failure to exercise care when
determining whether drafts and other documents presented under a Letter of Credit
comply with the terms thereof.  The
parties hereto expressly agree that, in the absence of gross negligence or
wilful misconduct on the part of the Issuing Bank (as finally determined by a
court of competent jurisdiction), the Issuing Bank shall be deemed to have
exercised care in each such determination. 
In furtherance of the foregoing and without limiting the generality
thereof, the parties agree that, with respect to documents presented which
appear on their face to be in substantial compliance with the terms of a Letter
of Credit, the Issuing Bank may, in its sole discretion, either accept and make
payment upon such documents without responsibility for further investigation,
regardless of any notice or information to the contrary, or refuse to accept
and make payment upon such documents if such documents are not in strict
compliance with the terms of such Letter of Credit, and any such acceptance or
refusal shall be deemed not to constitute gross negligence or wilful
misconduct.

 

(g)  Disbursement Procedures.  The Issuing Bank shall, promptly following
its receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit.  The
Issuing Bank shall promptly notify the Administrative Agent and the applicable
Borrower or Subsidiary by telephone (confirmed by facsimile) of such demand for
payment and whether the Issuing Bank has made or will make an L/C Disbursement
thereunder, provided that any failure to give or delay in giving such
notice shall not relieve such Borrower or Subsidiary of its obligation to
reimburse the Issuing Bank and the Revolving Lenders with respect to any such
L/C Disbursement in accordance with Section 2.05(e).

 

(h)  Interim
Interest.  If the Issuing Bank shall
make any L/C Disbursement, then, unless the applicable Borrower or Subsidiary
shall reimburse such L/C Disbursement in full on the date such L/C Disbursement
is made, the unpaid amount thereof shall bear interest, for each day from and
including the date such L/C Disbursement is made to but excluding the date that
such Borrower or Subsidiary reimburses such L/C Disbursement, at the rate per
annum then applicable to (i) ABR Revolving Loans, in the case of Letters
of Credit issued for the account of the Parent Borrower or any Domestic Subsidiary,
or (ii) Canadian Base Rate Revolving Loans, in the case of Letters of
Credit issued for the account of the Canadian Subsidiary Borrower or any
Foreign Subsidiary, provided that, if the applicable Borrower or
Subsidiary fails to reimburse such L/C Disbursement when due pursuant to
paragraph (e) of this Section 2.05, then Section 2.13(c) shall
apply.  Interest accrued pursuant to this
paragraph shall be for the account of the Issuing Bank, except that interest
accrued on and after the date of payment by any Revolving Lender pursuant to
paragraph (e) of this Section 2.05 to reimburse the Issuing Bank
shall be for the account of such Lender to the extent of such payment.

 

(i)  Replacement of
the Issuing Bank.  The Issuing Bank
may be replaced at any time by written agreement among the Parent Borrower, the
Administrative Agent, the replaced Issuing Bank and the successor Issuing
Bank.  The Administrative Agent shall
notify the Lenders of any such replacement of the Issuing Bank.  At the time any such replacement shall become
effective, the applicable Borrower shall pay all unpaid fees accrued for the
account of the replaced Issuing Bank pursuant to Section 2.12(b).  From and after the effective date of any such
replacement, (i) the successor Issuing Bank shall have all the rights and
obligations of the Issuing Bank under this Agreement with respect to Letters of
Credit to be issued thereafter and (ii) references herein to the term “Issuing
Bank” shall be deemed to refer to such successor or to any previous Issuing
Bank, or to such successor and all previous Issuing Banks, as the context shall
require.  After the replacement of an
Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto
and shall continue to have all the rights and obligations of an Issuing Bank
under this Agreement with respect to Letters of Credit issued by it prior to
such replacement, but shall not be required to issue additional Letters of
Credit.

 

56

 

(j)  Cash Collateralization.  If any Event of Default shall occur and be
continuing, on the Business Day that the Parent Borrower receives notice from
the Administrative Agent or the Required Lenders (or, if the maturity of the
Loans has been accelerated, the Revolving Lenders with a Total L/C Exposure
representing greater than 50% of the Total L/C Exposure) demanding the deposit
of cash collateral pursuant to this paragraph, (i) the Parent Borrower and
the Canadian Subsidiary Borrower shall deposit in an account with the applicable
Administrative Agent, in the name of the Administrative Agent and for the
benefit of the Revolving Lenders (each, an “L/C Collateral Account”), an
amount in cash equal to 105% of the U.S. L/C Exposure and the Canadian L/C
Exposure, respectively, as of such date plus accrued and unpaid interest
thereon, provided that the obligation to deposit such cash collateral
shall become effective immediately, and such deposit shall become immediately
due and payable, without demand or other notice of any kind, upon the
occurrence of any Event of Default with respect to the Parent Borrower
described in clause (h) or (i) of Article VII.  Such deposit shall be held by the
Administrative Agent as collateral for the payment and performance of the
Secured Obligations.  The Administrative
Agent shall have exclusive dominion and control, including the exclusive right
of withdrawal, over such accounts and the Borrowers hereby grant the
Administrative Agent a security interest in the L/C Collateral Accounts.  Other than any interest earned on the
investment of such deposits, which investments shall be made at the option and
sole discretion of the Administrative Agent and at the Borrowers’ risk and
expense, such deposits shall not bear interest. 
Interest or profits, if any, on such investments shall accumulate in
such accounts.  Moneys in such accounts
shall be applied by the Administrative Agent to reimburse the Issuing Bank for
L/C Disbursements for which it has not been reimbursed and, to the extent not
so applied, shall be held for the satisfaction of the reimbursement obligations
of the Borrowers for the Total L/C Exposure at such time or, if the maturity of
the Loans has been accelerated (but subject to the consent of Revolving Lenders
with a Total L/C Exposure representing greater than 50% of the Total L/C
Exposure), be applied to satisfy other Secured Obligations.  If any Borrower is required to provide an
amount of cash collateral hereunder as a result of the occurrence of an Event
of Default, such amount (to the extent not applied as aforesaid) shall be
returned to the applicable Borrower within three Business Days after all such
Events of Defaults have been cured or waived.

 

(k)  Conversion.  In the event that the Loans become
immediately due and payable on any date pursuant to Article VII, all
amounts (i) that the Canadian Subsidiary Borrower or any Foreign
Subsidiary is at the time or thereafter becomes required to reimburse or
otherwise pay to the Administrative Agent in respect of Canadian L/C
Disbursements (other than amounts in respect of which the Canadian Subsidiary
Borrower has deposited cash collateral pursuant to paragraph (j) above, if
such cash collateral was deposited in Canadian Dollars to the extent so
deposited or applied), (ii) that the Revolving Lenders are at the time or
thereafter become required to pay to the Administrative Agent and that the
Administrative Agent is at the time or thereafter becomes required to
distribute to the Issuing Bank pursuant to paragraph (e) of this Section 2.05
in respect of any unreimbursed Canadian L/C Disbursements and (iii) of
each Revolving Lender’s participation in any Letter of Credit issued for the
account of the Canadian Subsidiary Borrower or any Foreign Subsidiary under
which a Canadian L/C Disbursement has been made shall, automatically and with
no further action required, be converted into the U.S. Dollar Equivalent,
calculated using the Exchange Rates on such date (or, in the case of any
Canadian L/C Disbursement made after such date, on the date such Canadian L/C
Disbursement is made), of such amounts. 
On and after such conversion, all amounts accruing and owed to the
Administrative Agent, the Issuing Bank or any Revolving Lender in respect of
the obligations described in this paragraph shall accrue and be payable in U.S.
Dollars at the rates otherwise applicable hereunder.

 

SECTION 2.06.  Canadian Bankers’ Acceptances.  (a)  Each acceptance and purchase of
B/As of a single Contract Period pursuant to Section 2.01(b) or Section 2.08
shall be made ratably by the Lenders in accordance with the amounts of their
Canadian Revolving Sub-Commitments.  The
failure of any Revolving Lender to accept any B/A required to be accepted by it
shall not relieve any other Revolving Lender of its obligations hereunder, provided
that the Canadian Revolving Sub-Commitments 

 

57

 

are several and no Lender
shall be responsible for any other Lender’s failure to accept B/As as required.

 

(b)  The B/As of a
single Contract Period accepted and purchased on any date shall be in an
aggregate amount that is an integral multiple of C$500,000 and not less than
C$1,000,000.  The face amount of each B/A
shall be C$100,000 or any whole multiple thereof.  If any Revolving Lender’s ratable share of the
B/As of any Contract Period to be accepted on any date would not be an integral
multiple of C$100,000, the face amount of the B/As accepted by such Lender may
be increased or reduced to the nearest integral multiple of C$100,000 by the
Administrative Agent in its sole discretion. 
B/As of more than one Contract Period may be outstanding at the same
time, provided that there shall not at any time be more than a total of
five B/A Drawings outstanding (or such greater number as the Administrative
Agent shall agree).

 

(c)  To request an
acceptance and purchase of B/As, the Canadian Subsidiary Borrower shall notify
the Administrative Agent of such request in writing (delivered by hand or
facsimile) in a form approved by the Administrative Agent and signed by the
Canadian Subsidiary Borrower or by telephone not later than 12:00 noon,
Toronto time, two Business Days before the date of such acceptance and
purchase.  Each such request shall be
irrevocable and, if telephonic, shall be confirmed promptly by hand delivery or
facsimile to the Administrative Agent of a written request in a form approved
by the Administrative Agent and signed by the Canadian Subsidiary
Borrower.  Each such written and
telephonic request shall specify the following information:

 

(i) the aggregate face amount of the
B/As to be accepted and purchased;

 

(ii) the date of such acceptance and
purchase, which shall be a Business Day;

 

(iii) the Contract Period to be
applicable thereto, which shall be a period contemplated by the definition of
the term “Contract Period” (and which shall in no event end after the Maturity
Date); and

 

(iv) the location and number of the
Canadian Subsidiary Borrower’s account to which any funds are to be disbursed,
which shall comply with the requirements of Section 2.07.

 

If no Contract Period is specified with
respect to any requested acceptance and purchase of B/As, then the Canadian
Subsidiary Borrower shall be deemed to have selected a Contract Period of
30 days’ duration.  Promptly
following receipt of a request in accordance with this Section 2.06, the
Administrative Agent shall advise each Revolving Lender of the details thereof
and the amount of B/As to be accepted and purchased by such Lender.

 

(d)  The Canadian
Subsidiary Borrower hereby appoints each Revolving Lender as its attorney to
sign and endorse on its behalf, manually or by facsimile or mechanical
signature, as and when deemed necessary by such Lender, blank forms of
B/As.  It shall be the responsibility of
each Revolving Lender to maintain an adequate supply of blank forms of B/As for
acceptance under this Agreement.  The
Canadian Subsidiary Borrower recognizes and agrees that all B/As signed and/or
endorsed on its behalf by any Lender shall bind the Canadian Subsidiary
Borrower as fully and effectually as if manually signed and duly issued by
authorized officers of the Canadian Subsidiary Borrower.  Each Revolving Lender is hereby authorized to
issue such B/As endorsed in blank in such face amounts as may be determined by
such Lender, provided that the aggregate face amount thereof is equal to
the aggregate face amount of B/As required to be accepted by such Lender.  No Revolving Lender shall be liable for any
damage, loss or claim arising by reason of any loss or improper use of any such
instrument unless such loss or improper use results from the bad faith, gross
negligence or wilful misconduct of such Lender. 
Each Revolving Lender shall maintain a record with respect to B/As (i) received
by it from the Administrative 

 

58

 

Agent in blank hereunder, (ii) voided
by it for any reason, (iii) accepted and purchased by it hereunder and (iv) canceled
at their respective maturities.  Each
Revolving Lender further agrees to retain such records in the manner and for
the periods provided in applicable provincial or Federal statutes and
regulations of Canada and to provide such records to the Canadian Subsidiary
Borrower upon its request and at its expense. 
Upon request by the Canadian Subsidiary Borrower, a Revolving Lender
shall cancel all forms of B/A that have been pre-signed or pre-endorsed on
behalf of the Canadian Subsidiary Borrower and that are held by such Lender and
are not required to be issued pursuant to this Agreement.

 

(e)  Drafts of the
Canadian Subsidiary Borrower to be accepted as B/As hereunder shall be signed
as set forth in paragraph (d) above. 
Notwithstanding that any Person whose signature appears on any B/A may
no longer be an authorized signatory for any of the Revolving Lenders or the
Canadian Subsidiary Borrower at the date of issuance of such B/A, such
signature shall nevertheless be valid and sufficient for all purposes as if
such authority had remained in force at the time of such issuance and any such
B/A so signed shall be binding on the Canadian Subsidiary Borrower.

 

(f)  Upon acceptance of
a B/A by a Revolving Lender, such Lender shall purchase, or arrange the
purchase of, such B/A from the Canadian Subsidiary Borrower at the Discount B/A
Rate for such Lender applicable to such B/A accepted by it and provide to the
Administrative Agent the Discount Proceeds for the account of the Canadian
Subsidiary Borrower as provided in Section 2.07.  The Acceptance Fee payable by the Canadian
Subsidiary Borrower to a Revolving Lender under Section 2.12(c) in
respect of each B/A accepted by such Lender shall be set off against the
Discount Proceeds payable by such Lender under this paragraph.  Notwithstanding the foregoing, in the case of
any B/A Drawing resulting from the conversion or continuation of a B/A Drawing
or Canadian Revolving Loan pursuant to Section 2.08, the net amount that
would otherwise be payable to the Canadian Subsidiary Borrower by each
Revolving Lender pursuant to this paragraph will be applied as provided in Section 2.08(d).

 

(g)  Each Revolving
Lender may at any time and from time to time hold, sell, rediscount or
otherwise dispose of any or all B/As accepted and purchased by it, provided that no such sale or
disposition shall cause the amount payable by the Canadian Subsidiary Borrower
under Section 2.17 to exceed the amount that would have been payable
thereunder in the absence of such sale or disposition.

 

(h)  Each B/A accepted
and purchased hereunder shall mature at the end of the Contract Period
applicable thereto.

 

(i)  The Canadian
Subsidiary Borrower waives presentment for payment and any other defense to
payment of any amounts due to a Revolving Lender in respect of a B/A accepted
and purchased by it pursuant to this Agreement that might exist solely by
reason of such B/A being held, at the maturity thereof, by such Lender in its
own right and the Canadian Subsidiary Borrower agrees not to claim any days of
grace if such Lender as holder sues the Canadian Subsidiary Borrower on the B/A
for payment of the amounts payable by the Canadian Subsidiary Borrower
thereunder.  On the specified maturity
date of a B/A, or such earlier date as may be required pursuant to the
provisions of this Agreement, the Canadian Subsidiary Borrower shall pay the
Revolving Lender that has accepted and purchased such B/A the full face amount
of such B/A (or shall make provision for the conversion or continuation of such
B/A in accordance with Section 2.08) in Canadian Dollars, and, after such
payment, the Canadian Subsidiary Borrower shall have no further liability in
respect of such B/A and such Lender shall be entitled to all benefits of, and
be responsible for all payments due to third parties under, such B/A.

 

(j)  At the option of
the Canadian Subsidiary Borrower and any Revolving Lender, B/As under this
Agreement to be accepted by such Lender may be issued in the form of depository
bills for 

 

59

 

deposit with The Canadian
Depository for Securities Limited pursuant to the Depository Bills and Notes Act
(Canada).  All depository bills so issued
shall be governed by the provisions of this Section 2.06.

 

(k)  If a Revolving
Lender is not a chartered bank under the Bank
Act (Canada) or if a Revolving Lender notifies the Administrative Agent
in writing that it is otherwise unable to accept B/As (each such Lender, a “Non-B/A
Lender”), such Lender will, instead of accepting and purchasing B/As, make
a Loan (a “B/A Equivalent Loan”) to the Canadian Subsidiary Borrower in
the amount and for the same term as the draft that such Lender would otherwise
have been required to accept and purchase hereunder.  Each such Lender may request that such B/A
Equivalent Loan be evidenced by a non-interest bearing promissory note, in a form
approved by the Parent Borrower and the Administrative Agent.  Each such Lender will provide to the
Administrative Agent the Discount Proceeds of such B/A Equivalent Loan for the
account of the Canadian Subsidiary Borrower in the same manner as such Lender
would have provided the Discount Proceeds in respect of the draft that such
Lender would otherwise have been required to accept and purchase
hereunder.  Each such B/A Equivalent Loan
will bear interest at the same rate that would result if such Lender had
accepted (and been paid an Acceptance Fee) and purchased (on a discounted
basis) a B/A for the relevant Contract Period (it being the intention of the
parties that each such B/A Equivalent Loan shall have the same economic
consequences for the Revolving Lenders and the Canadian Subsidiary Borrower as
the B/A that such B/A Equivalent Loan replaces).  All such interest shall be paid in advance on
the date such B/A Equivalent Loan is made and will be deducted from the
principal amount of such B/A Equivalent Loan in the same manner in which the Discount
Proceeds of a B/A would be deducted from the face amount of the B/A.  Subject to the repayment requirements of this
Agreement, on the last day of the relevant Contract Period for such B/A
Equivalent Loan, the Canadian Subsidiary Borrower shall be entitled to convert
each such B/A Equivalent Loan into another type of Loan, or to roll over each
such B/A Equivalent Loan into another B/A Equivalent Loan, all in accordance
with the applicable provisions of this Agreement.

 

(l)  If the
Administrative Agent determines and promptly notifies the Parent Borrower that,
by reason of circumstances affecting the money market, there is no market for
B/As, (i) the right of the Canadian Subsidiary Borrower to request an
acceptance and purchase of B/As shall be suspended until the Administrative
Agent determines that the circumstances causing such suspension no longer exist
and so notifies the Parent Borrower, and (ii) any notice relating to an
acceptance and purchase of B/As that is outstanding at such time shall be deemed
to be a notice requesting a Canadian Base Rate Revolving Borrowing (as if it
were a notice given pursuant to Section 2.03).

 

SECTION 2.07.  Funding of Borrowings.  (a)  Each Lender shall make each Loan to
be made by it and disburse the Discount Proceeds (net of applicable Acceptance
Fees) of each B/A to be accepted and purchased by it hereunder on the proposed
date thereof by wire transfer of immediately available funds by 1:00 p.m.,
Local Time, to the account of the Administrative Agent most recently designated
by it for such purpose by notice to the Lenders, provided that Swingline
Loans shall be made as provided in Section 2.04.  The Administrative Agent will make such Loans
or Discount Proceeds (net of applicable Acceptance Fees) available to the applicable
Borrower by promptly crediting the amounts so received, in like funds, to the
such Borrower’s Funding Account, provided that ABR Revolving Loans, U.S.
Base Rate Revolving Loans, Canadian Base Rate Revolving Loans and Swingline
Loans made to finance the reimbursement of an L/C Disbursement and
reimbursements as provided in Section 2.05(e) shall be remitted by
the Administrative Agent to the Issuing Bank or, to the extent that the
Revolving Lenders have made payments to the Issuing Bank pursuant to Section 2.05(e) to
reimburse the Issuing Bank, then to such Lenders and the Issuing Bank as their
interests may appear.

 

(b)  Unless the
Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing or acceptance and purchase of B/As that such
Lender will not make available to the Administrative Agent such Lender’s share
of such Borrowing or the applicable Discount 

 

60

 

Proceeds (net of the
applicable Acceptance Fees), the Administrative Agent may assume that such
Lender has made such share available on such date in accordance with paragraph (a) of
this Section 2.07 and may, in reliance upon such assumption, make
available to the applicable Borrower a corresponding amount.  In such event, if a Lender has not in fact
made its share of such Borrowing or Discount Proceeds (net of the applicable
Acceptance Fees) available to the Administrative Agent, then the applicable
Lender and the applicable Borrower severally agree to pay to the Administrative
Agent forthwith on demand such corresponding amount with interest thereon, for
each day from and including the date such amount is made available to the
applicable Borrower to but excluding the date of payment to the Administrative
Agent, at (i) in the case of such Lender, the greater of (A)(1) if
such amount corresponds to a Borrowing made by the Parent Borrower, the Federal
Funds Effective Rate, or (2) if such amount corresponds to a Borrowing
made by the Canadian Subsidiary Borrower, the rate reasonably determined by the
Administrative Agent to be the cost to it of funding such amount, and (B) a
rate determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation, (ii) in the case of the Parent
Borrower, the interest rate applicable to ABR Revolving Loans or ABR Term
Loans, as the case may be, or (iii) in the case of the Canadian Subsidiary
Borrower, (A) if such amount corresponds to a Borrowing made in U.S.
Dollars, the interest rate applicable to U.S. Base Rate Revolving Loans, and (B) if
such amount corresponds to a B/A Drawing or a Borrowing made in Canadian
Dollars, the interest rate applicable to Canadian Base Rate Revolving
Loans.  If such Lender pays such amount
to the Administrative Agent, then such amount shall constitute such Lender’s
Loan included in such Borrowing or such Lender’s acceptance and purchase of
B/As.

 

SECTION 2.08.  Interest Elections.  (a)  Each Borrowing initially shall be
of the Type specified in the applicable Borrowing Request and, in the case of a
Eurodollar Borrowing, shall have an initial Interest Period as specified in
such Borrowing Request.  Each B/A Drawing
shall have a Contract Period as specified in the applicable request
therefor.  Thereafter, the Borrower may
elect to convert such Borrowing or B/A Drawing to a different Type or to
continue such Borrowing or B/A Drawing and, in the case of a Eurodollar
Revolving Borrowing, may elect Interest Periods therefor, all as provided in
this Section 2.08, it being understood that no B/A Drawing may be
converted or continued other than at the end of the Contract Period applicable
thereto.  The applicable Borrower may
elect different options with respect to different portions of the affected
Borrowing or B/A Drawing, in which case each such portion shall be allocated
ratably among the Lenders holding the Loans comprising such Borrowing or
accepting B/As comprising such B/A Drawing, as the case may be, and the Loans
or B/As resulting from an election made with respect to any such portion shall
be considered a separate Borrowing or B/A Drawing.  This Section 2.08 shall not apply to
Swingline Borrowings, which may not be converted or continued.

 

(b)  To make an
election pursuant to this Section 2.08, the applicable Borrower shall
notify the Administrative Agent of such election by telephone (i) in the
case of an election that would result in a Borrowing, by the time that a
Borrowing Request would be required under Section 2.03 if such Borrower
were requesting a Revolving Borrowing of the Type resulting from such election
to be made on the effective date of such election, and (ii) in the case of
an election that would result in a B/A Drawing or the continuation of a B/A
Drawing, by the time that a request would be required under Section 2.06
if such Borrower were requesting an acceptance and purchase of B/As to be made
on the effective date of such election. 
Each such telephonic Interest Election Request shall be irrevocable and
shall be confirmed promptly by hand delivery or facsimile to the Administrative
Agent of a written Interest Election Request in a form approved by the
Administrative Agent and signed by the applicable Borrower.  Notwithstanding any other provision of this Section 2.08,
no Borrower shall be permitted to (i) change the currency of any
Borrowing, (ii) elect an Interest Period for Eurodollar Loans that does
not comply with Section 2.02(d) or a Contract Period for B/As that
does not comply with Section 2.06(c)(iii) or (iii) convert any
Borrowing or B/A Drawing to a Revolving Borrowing or B/A Drawing not available
under the Class of Commitments pursuant to which such Borrowing or B/A
Drawing was made.  Each such written and
telephonic Interest Election Request shall specify the following information:

 

61

 

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

 

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

 

(iii) whether the resulting outstanding
credit extension is to be an ABR Borrowing, U.S. Base Rate Revolving Borrowing,
Canadian Base Rate Revolving Borrowing, Eurodollar Borrowing or B/A Drawing;

 

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

 

(v) in the case of an election of a B/A
Drawing, the Contract Period to be applicable thereto, which shall be a period
contemplated by the definition of the term Contract Period.

 

If any such Interest Election Request
requests a Eurodollar Borrowing or B/A Drawing but does not specify an Interest
Period or Contract Period, then the applicable Borrower shall be deemed to have
selected an Interest Period or Contract Period of one month’s or 30 days’
duration, as applicable.  Promptly
following receipt of an Interest Election Request, the Administrative Agent
shall advise each Lender of the details thereof and of such Lender’s portion of
each resulting Borrowing or B/A Drawing.

 

(c)  If a Borrower
fails to deliver a timely Interest Election Request with respect to a Eurodollar
Borrowing or a B/A Drawing prior to the end of the Interest Period or Contract
Period applicable thereto, then, unless such Borrowing or B/A is repaid as
provided herein, at the end of such Interest Period such Borrowing or B/A
Drawing shall (i) in the case of a Eurodollar U.S. Revolving Borrowing, be
converted to an ABR Revolving Borrowing, (ii) in the case of a Eurodollar
Canadian Revolving Borrowing, be converted to a U.S. Base Rate Revolving
Borrowing, (iii) in the case of a Eurodollar Term Borrowing, be converted
to an ABR Term Borrowing, and (iv) in the case of a B/A Drawing, be
converted to a Canadian Base Rate Revolving Borrowing.  Notwithstanding any contrary provision
hereof, if an Event of Default has occurred and is continuing and the Administrative
Agent, at the request of the Required Lenders, so notifies the Parent Borrower,
then, so long as an Event of Default is continuing, (i) no outstanding
Borrowing may be converted to or continued as a Eurodollar Borrowing or a B/A
Drawing and no B/A Drawing outstanding may be continued as a B/A Drawing, (ii) unless
repaid, each Eurodollar Borrowing shall (A) in the case of a Eurodollar
U.S. Revolving Borrowing, be converted to an ABR Revolving Borrowing at the end
of the Interest Period applicable thereto, (B) in the case of a Eurodollar
Canadian Revolving Borrowing, be converted to a U.S. Base Rate Revolving
Borrowing at the end of the Interest Period applicable thereto, and (C) in
the case of a Eurodollar Term Borrowing, be converted to an ABR Term Borrowing
at the end of the Interest Period applicable thereto, and (iii) unless
repaid, each B/A Drawing shall be converted to a Canadian Base Rate Revolving
Borrowing.

 

(d)  Upon the
conversion of any Canadian Revolving Borrowing (or portion thereof) to, or the
continuation of any B/A Drawing (or portion thereof) as, a B/A Drawing, the net
amount that would otherwise be payable to the Canadian Subsidiary Borrower by
each Revolving Lender pursuant to Section 2.06(f) in respect of such
new B/A Drawing shall be applied against the principal of the Canadian 

 

62

 

Revolving Loans made by each
Revolving Lender as part of such Canadian Revolving Borrowing (in the case of a
conversion) or the reimbursement obligation owed to such Lender under Section 2.06(i) in
respect of the B/As accepted by such Lender as part of such maturing B/A
Drawing (in the case of a continuation) and the Canadian Subsidiary Borrower
shall pay to such Lender an amount equal to the difference between the
principal amount of such Canadian Revolving Loans or the aggregate face amount
of such maturing B/As, as the case may be, and such net amount.

 

SECTION 2.09.  Termination and Reduction of Commitments.  (a)  Unless previously terminated, (i) the
Initial Term Commitment shall terminate at 5:00 p.m., New York City time,
on the Restatement Effective Date and (ii) all Revolving Commitments shall
terminate on the Maturity Date.

 

(b)  The Borrowers may
at any time terminate, or from time to time reduce, the Commitments of any
Class, provided that (i) each partial reduction of the Commitments
of any Class shall be in an amount that is an integral multiple of
$1,000,000 and not less than $2,000,000, (ii) the Borrowers shall not
terminate or reduce the Revolving Commitments if, after giving effect to any
concurrent prepayment of the Revolving Loans in accordance with Section 2.11,
the aggregate Revolving Exposure would exceed the lesser of (A) the
aggregate Revolving Commitments and (B) an amount equal to (x) the
Total Borrowing Base then in effect minus (y) the Availability
Block, (iii) the Borrowers shall not terminate or reduce the Revolving
Commitments if, after giving effect to any concurrent prepayment of the U.S.
Revolving Loans in accordance with Section 2.11, the U.S. Revolving
Exposure would exceed the Domestic Borrowing Base then in effect, (iv) the
Borrowers shall not terminate or reduce the Canadian Revolving Sub-Commitments
if, after giving effect to any concurrent prepayment of the Canadian Revolving
Loans in accordance with Section 2.11, the Canadian Revolving Exposure
would exceed the lesser of (A) the aggregate Canadian Revolving
Sub-Commitments and (B) the Canadian Borrowing Base then in effect and (v) the
Borrowers shall not terminate or reduce the Revolving Commitments if, after
giving effect to such termination or reduction, the aggregate Canadian
Revolving Sub-Commitments would exceed the aggregate Revolving Commitments.

 

(c)  The applicable
Borrower shall notify the Administrative Agent of any election to terminate or
reduce the Revolving Commitments, Canadian Revolving Sub-Commitments or Term
Commitments under paragraph (b) of this Section 2.09 at least
three Business Days prior to the effective date of such termination or
reduction, specifying such election and the effective date thereof.  Promptly following receipt of any notice, the
Administrative Agent shall advise the Lenders of the contents thereof.  Each notice delivered by a Borrower pursuant
to this Section 2.09 shall be irrevocable, provided that a notice
of termination of the Revolving Commitments or the Canadian Revolving
Sub-Commitments delivered by a Borrower may state that such notice is
conditioned upon consummation of an acquisition or sale transaction or upon the
effectiveness of other credit facilities or the receipt of proceeds from the
issuance of other Indebtedness, in which case such notice may be revoked by
such Borrower (by notice to the Administrative Agent on or prior to the
specified effective date) if such condition is not satisfied.  Any termination or reduction of the
Commitments of any Class shall be permanent.  Each reduction of the Commitments of any Class shall
be made ratably among the Lenders in accordance with their respective
Commitments of such Class.

 

SECTION 2.10.  Repayment of Loans and B/As; Evidence of
Debt.  (a)  Each Borrower hereby
unconditionally promises to pay (i) to the Administrative Agent for the
account of each Revolving Lender the then unpaid principal amount of each
Revolving Loan of such Lender made to such Borrower on the Maturity Date and
the face amount of each B/A of such Borrower, if any, accepted by such Lender
as provided in Section 2.06, (ii) to the Administrative Agent for the
account of each Term Lender the then unpaid principal amount of each Term Loan
of such Lender made to such Borrower on the Maturity Date and (iii) to the
Swingline Lender the then unpaid principal amount of each Swingline Loan on the
earlier of the Maturity Date and the first date after such Swingline Loan is
made that is the 15th or last day of a 

 

63

 

calendar month and is at
least two Business Days after such Swingline Loan is made, provided that
on each date that a U.S. Revolving Loan is made, the Parent Borrower shall
repay all Swingline Loans then outstanding.

 

(b)  At all times that
full cash dominion is in effect pursuant to Section 3.06 of the Domestic
Security Agreement and the Canadian Security Agreement (or the applicable
provisions, if any, of the other Collateral Documents), on each Business Day,
at or before 12:00 noon, Local Time, the Administrative Agent shall apply all
immediately available funds to prepay first, the Revolving Loans (including
Swingline Loans) and amounts owing in respect of B/A Drawings and second,
subject to Section 2.05(j), to cash collateralize outstanding Total L/C
Exposure, provided that such prepayments shall be applied in a manner
that minimizes payments due pursuant to Section 2.16.

 

(c)  Each Lender shall
maintain in accordance with its usual practice an account or accounts
evidencing the Indebtedness of each Borrower to such Lender resulting from each
Loan made or B/A accepted by such Lender, including the amounts of principal
and interest and amounts in respect of B/As payable and paid to such Lender
from time to time hereunder.

 

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

 

(e)  The entries made
in the accounts maintained pursuant to paragraph (c) or (d) of this Section 2.10
shall be, absent manifest error, prima  facie evidence of the
existence and amounts of the obligations recorded therein, provided that
the failure of any Lender or the Administrative Agent to maintain such accounts
or any error therein shall not in any manner affect the obligation of any
Borrower to repay the Loans or amounts owing in respect of B/A Drawings in
accordance with the terms of this Agreement.

 

(f)  Any Lender may
request that Loans of any Class made by it be evidenced by a promissory
note.  In such event, the applicable
Borrower shall prepare, execute and deliver to such Lender a promissory note
payable to the order of such Lender (or, if requested by such Lender, to such
Lender and its registered assigns) and in a form approved by the Administrative
Agent unless the applicable Borrower shall have already delivered a note
representing such Loans, in which case the applicable Borrower shall have the
right to have such note returned to it prior to delivering a new note.  Thereafter, the Loans evidenced by such
promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 9.04) be represented by one or more
promissory notes in such form payable to the order of the payee named therein
(or, if such promissory note is a registered note, to such payee and its
registered assigns).

 

SECTION 2.11.  Prepayments.  (a)  Each Borrower shall have the right
at any time and from time to time to prepay any Borrowing or amount owed in
respect of outstanding B/As, in whole or in part, without premium or penalty
(but subject to Section 2.16), subject to the requirements of this Section 2.11,
provided that no Term Borrowing shall be prepaid unless, at the time of
and immediately after giving effect to such prepayment, (i) no Default
described in clause (a), (b), (h), (i) or (j) of Article VII has
occurred and is continuing, (ii) no Event of Default described in clause (g) (but
only if such Default or Event of Default results from (A) an event or
condition that results in any Material Indebtedness becoming due prior to its
scheduled maturity or (B) a default or event of default in respect of any
Material Indebtedness of the kind described in clauses (a), (b), (h), (i) or
(j) of Article VII) or (k) of 

 

64

 

Article VII has
occurred and is continuing and (iii) Reference Availability shall exceed
$45,000,000.

 

(b)  In the event and
on such occasion that (i) the aggregate Revolving Exposure exceeds the
lesser of (A) the aggregate Revolving Commitments and (B) an amount
equal to (x) the Total Borrowing Base then in effect minus (y) the
Availability Block, (ii) the U.S. Revolving Exposure exceeds the Domestic
Borrowing Base then in effect or (iii) the Canadian Revolving Exposure
exceeds the lesser of (A) the aggregate Canadian Revolving Sub-Commitments
or (B) the Canadian Borrowing Base then in effect, the applicable Borrower
shall prepay the applicable Revolving Borrowings or Swingline Borrowings or
amounts owing in respect of outstanding B/A Drawings (or, if no such Borrowings
or B/A Drawings are outstanding, deposit cash collateral in the applicable L/C
Collateral Account pursuant to Section 2.05(j)) in an aggregate amount
equal to such excess within one Business Day after the day of such event or
occasion.  In addition, the Borrowers
shall make (1) any prepayments required by Section 5.12 and (2) any
prepayments required by the Senior Secured Notes Indenture as a condition to
making an Excess Cash Flow Offer (as defined in the Senior Secured Notes Indenture).

 

(c)  Prior to any
optional or mandatory prepayment of Borrowings or amounts owing in respect of
outstanding B/A Drawings, the applicable Borrower shall select the Borrowing or
Borrowings or the B/A Drawing or B/A Drawings to be prepaid and shall specify
such selection in the notice of such prepayment pursuant to paragraph (d) of
this Section 2.11.

 

(d)  The applicable
Borrower shall notify the Administrative Agent (and, in the case of prepayment
of a Swingline Loan, the Swingline Lender) by telephone (confirmed by
facsimile) of any prepayment hereunder (i) in the case of prepayment of a
Eurodollar Borrowing, not later than 12:00 noon, Local Time, three Business
Days before the date of prepayment, (ii) in the case of prepayment of any
ABR Borrowing, U.S. Base Rate Revolving Borrowing, Canadian Base Rate Revolving
Borrowing or B/A Drawing, not later than 12:00 noon, Local Time, one Business
Day before the date of prepayment or (iii) in the case of prepayment of a
Swingline Loan, not later than 1:00 p.m., New York City time, on the date
of prepayment.  Each such telephonic
notice shall be irrevocable and shall specify the prepayment date, the
principal amount of each Borrowing or portion thereof, or amount owed in respect
of an outstanding B/A Drawing or portion thereof, to be prepaid and, in the
case of a mandatory prepayment, a reasonably detailed calculation of the amount
of such prepayment, provided that if a notice of prepayment is given in
connection with a conditional notice of termination of the Revolving
Commitments or Canadian Revolving Sub-Commitments as contemplated by Section 2.09,
then such notice of prepayment may be revoked if such notice of termination is
revoked in accordance with Section 2.09. 
In addition, a notice of optional prepayment may state that such notice
is conditional upon the consummation of an acquisition or asset sale or upon
the effectiveness of other credit facilities or the receipt of proceeds from
the issuance of other Indebtedness, in which case such notice may be revoked if
the applicable contingency has not occurred. 
Promptly following receipt of any such notice, the Administrative Agent
shall advise the Lenders of the contents thereof.  Each partial prepayment of any Borrowing or
amounts owing in respect of an outstanding B/A Drawing shall be in an amount
that would be permitted in the case of an advance of a Borrowing of the same
Type as provided in Section 2.02 or an acceptance and purchase of B/As as
provided in Section 2.06, except as necessary to apply fully the required
amount of a mandatory prepayment.  Each
prepayment of a Borrowing or amounts owing in respect of an outstanding B/A
Drawing shall be applied ratably to the Loans included in such prepaid
Borrowing or the B/As included in such B/A Drawing.  Prepayments shall be accompanied by accrued
interest to the extent required by Section 2.13.

 

(e)  Amounts to be
applied pursuant to this Section 2.11 or Article VII to prepay or
repay amounts to become due with respect to outstanding B/As shall be deposited
in the Prepayment Account.  On the last
day of the Contract Period of each B/A to be prepaid or repaid, the
Administrative Agent shall apply any cash on deposit in the Prepayment Account
to amounts due in respect of the relevant B/As until 

 

65

 

the aggregate face amount
due in respect of the relevant outstanding B/As has been reimbursed (with any
remaining funds being returned to the Canadian Subsidiary Borrower) or until
all the allocable cash on deposit has been exhausted.  The Administrative Agent will, at the request
of the Canadian Subsidiary Borrower, use commercially reasonable efforts to
invest amounts on deposit in the Prepayment Account in short-term, cash
equivalent investments selected by the Administrative Agent in consultation
with the Canadian Subsidiary Borrower that mature prior to the last day of the
applicable Contract Periods of the B/As to be prepaid, provided that the
Administrative Agent shall have no obligation to invest amounts on deposit in
the Prepayment Account if an Event of Default shall have occurred and be
continuing.  The Canadian Subsidiary
Borrower shall indemnify the Administrative Agent for any losses relating to
the investments made at the request or direction of the Canadian Subsidiary
Borrower so that the amount available to prepay amounts due in respect of B/As
on the last day of the applicable Contract Period is not less than the amount
that would have been available had no investments been made pursuant thereto.  Other than any interest earned on such
investments (which shall be for the account of the Canadian Subsidiary
Borrower, to the extent not necessary for the prepayment of B/As in accordance
with this Section 2.11), the Prepayment Account shall not bear
interest.  Interest or profits, if any,
on such investments shall be deposited in the Prepayment Account and reinvested
and disbursed as specified above.  If the
maturity of the Loans and all amounts due hereunder has been accelerated
pursuant to Article VII, the Administrative Agent may, in its sole
discretion, apply all amounts on deposit in the Prepayment Account to satisfy
the Canadian Obligations (and the Canadian Subsidiary Borrower hereby grants to
the Administrative Agent a security interest in the Prepayment Account to
secure such Canadian Obligations).

 

SECTION 2.12.  Fees. 
(a)  The Parent Borrower agrees to pay to the Administrative Agent
for the account of each Revolving Lender a commitment fee (a “Commitment Fee”),
which shall accrue at the Applicable Rate on the average daily unused amount of
the Revolving Commitment of such Lender during the period from and including
the Effective Date to but excluding the date on which such Lender’s Revolving
Commitment terminates.  Commitment Fees
accrued through and including the last day of each March, June, September and
December shall be payable on the third Business Day following such last
day, commencing on the first such date to occur after the date hereof, provided
that all such accrued Commitment Fees shall be payable on the date on which the
Revolving Commitments terminate.  All
Commitment Fees shall be computed on the basis of a year of 360 days and shall
be payable for the actual number of days elapsed (including the first day but
excluding the last day).  For purposes of
computing Commitment Fees, a Revolving Commitment of a Revolving Lender shall
be deemed to be used to the extent of the outstanding Revolving Loans and Total
L/C Exposure of such Lender (and the Total Swingline Exposure of such Lender
shall be disregarded for such purpose).

 

(b)  The Parent
Borrower agrees to pay (i) to the Administrative Agent for the account of
each Revolving Lender a participation fee (a “Participation Fee”) with
respect to its participations in Letters of Credit, which shall accrue at the
same Applicable Rate used to determine the interest rate applicable to
Eurodollar Revolving Loans on the average daily amount of such Lender’s Total
L/C Exposure (excluding any portion thereof attributable to unreimbursed L/C
Disbursements) during the period from and including the Effective Date to but
excluding the later of the date on which such Lender’s Revolving Commitments
terminate and the date on which such Lender ceases to have any Total L/C
Exposure, and (ii) to the Issuing Bank a fronting fee (a “Fronting Fee”),
which shall accrue at the rate of 0.25% per annum on the average daily amount
of the Total L/C Exposure (excluding any portion thereof attributable to
unreimbursed L/C Disbursements) during the period from and including the Effective
Date to but excluding the later of the date of termination of the Revolving
Commitments and the date on which there ceases to be any Total L/C Exposure, as
well as the Issuing Bank’s standard fees with respect to the issuance,
amendment, renewal or extension of any Letter of Credit or processing of
drawings thereunder.  Participation Fees
and Fronting Fees accrued through and including the last day of each March,
June, September and December shall be payable on the third Business
Day following such last day, 

 

66

 

commencing on the first such
date to occur after the Effective Date, provided that all such accrued
fees shall be payable on the date on which the Revolving Commitments terminate
and any such fees accruing after the date on which the Revolving Commitments
terminate shall be payable on demand. 
Any other fees payable to the Issuing Bank pursuant to this paragraph
shall be payable within 10 Business Days after written demand.  All Participation Fees and Fronting Fees
shall be computed on the basis of a year of 360 days and shall be payable for
the actual number of days elapsed (including the first day but excluding the
last day).

 

(c)  The Canadian
Subsidiary Borrower agrees to pay to the Administrative Agent, for the account
of each Revolving Lender, on each date on which B/As drawn by the Canadian
Subsidiary Borrower are accepted hereunder, in Canadian Dollars, an acceptance
fee (an “Acceptance Fee”) computed by multiplying the face amount of
each such B/A by the product of (i) the Applicable Rate for B/A Drawings
on such date and (ii) a fraction, the numerator of which is the number of
days in the Contract Period applicable to such B/A and the denominator of which
is 365.

 

(d)  Each Borrower
agrees to pay to the Administrative Agent, for its own account, fees payable in
the amounts and at the times separately agreed upon between the Parent Borrower
and the Administrative Agent.

 

(e)  All fees payable
hereunder shall be paid on the dates due, in immediately available funds, to
the Administrative Agent (or to the Issuing Bank, in the case of fees payable
to it) for distribution, in the case of Commitment Fees, Participation Fees and
Acceptance Fees, to the Lenders entitled thereto.  Fees paid (other than any portion of such
fees that represent overpayments) shall not be refundable under any
circumstances.

 

(f)  For purposes of
clarification, (i) any fee required to be paid under this Section 2.12
for a payment period ending prior to the Restatement Effective Date shall be
deemed to have been paid for purposes of this Section 2.12 to the extent
that such fee was paid under, and in accordance with the terms of, the Original
Credit Agreement and (ii) any fee required to be paid under this Section 2.12
for any portion of a payment period that occurs prior to the Restatement
Effective Date shall, solely with respect to such portion of such payment
period, be determined in the manner and in accordance with the terms set forth
in Section 2.12 of the Original Credit Agreement.

 

SECTION 2.13.  Interest.  (a)  (i) The Loans comprising each
ABR Borrowing (including each Swingline Loan made to the Parent Borrower)
shall bear interest at the Alternate Base Rate plus the Applicable Rate,
(ii) the Loans comprising each U.S. Base Rate Revolving Borrowing
(including each Swingline Loan made to the Canadian Subsidiary Borrower that is
denominated in U.S. Dollars) shall bear interest at the U.S. Base Rate plus
the Applicable Rate and (iii) the Loans comprising each Canadian Base Rate
Revolving Borrowing (including each Swingline Loan made to the Canadian
Subsidiary Borrower that is denominated in Canadian Dollars) shall bear
interest at the Canadian Base Rate plus the Applicable Rate, provided
that, solely in respect of the Term Loans, if the Alternate Base Rate shall, at
any time, be less than 4.25%, then the Alternate Base Rate at such time shall
be deemed to be 4.25%.

 

(b)  The Loans
comprising each Eurodollar Borrowing shall bear interest at the Adjusted LIBO
Rate for the Interest Period in effect for such Borrowing plus the
Applicable Rate, provided that, solely in respect of the Term Loans, if
the Adjusted LIBO Rate shall, at any time, be less than 3.25%, then the
Adjusted LIBO Rate at such time shall be deemed to be 3.25%.

 

(c)  Notwithstanding
the foregoing, if any principal of or interest on any Loan or any fee or other
amount payable by any Borrower hereunder is not paid when due, whether at
stated maturity, upon acceleration or otherwise, such overdue amount shall bear
interest, after as well as before judgment, 

 

67

 

at a rate per annum equal to
(i) in the case of overdue principal of any Loan, 2.00% plus the
rate otherwise applicable to such Loan as provided in the preceding paragraphs
of this Section 2.13 or (ii) in the case of any other amount, 2.00% plus
the rate applicable to (A) in the case of an amount owed by the Parent
Borrower, an ABR Loan, (B) in the case of an amount owed by the Canadian
Subsidiary Borrower and denominated in U.S. Dollars, a U.S. Base Rate Loan or (C) in
the case of an amount owed by the Canadian Subsidiary Borrower and denominated
in Canadian Dollars, a Canadian Base Rate Loan.

 

(d)  Accrued interest
on each Loan shall be payable in arrears on each Interest Payment Date for such
Loan and, in the case of Loans in respect of any Class, upon termination of the
Revolving Commitments in respect of such Class, provided that (i) interest
accrued pursuant to paragraph (c) of this Section 2.13 shall be payable
on demand, (ii) in the event of any repayment or prepayment of any Loan
(other than a prepayment of an ABR Revolving Borrowing, U.S. Base Rate
Revolving Borrowing or Canadian Base Rate Revolving Borrowing prior to the end
of the Availability Period), accrued interest on the principal amount repaid or
prepaid shall be payable on the date of such repayment or prepayment, and (iii) in
the event of any conversion of any Eurodollar Loan prior to the end of the
current Interest Period therefor, accrued interest on such Loan shall be
payable on the effective date of such conversion.  Notwithstanding anything in this agreement
contrary, accrued interest on the Term Loans shall not be payable at any time
when a Default or Event of Default described in clause (a), (b), (h) or (i) of
Article VII has occurred and is continuing, provided that interest
shall continue to accrue on the Term Loans during such period in accordance
with this Section 2.13, and such accrued interest shall be payable on the
first Interest Payment Date after the date on which all such Defaults and
Events of Default cease to exist or the Discharge of Revolving Lender Claims
shall have occurred.

 

(e)  All interest
hereunder shall be computed on the basis of a year of 360 days, except that
interest computed by reference to (i) the Alternate Base Rate at times
when the Alternate Base Rate is based on the Prime Rate and (ii) the U.S.
Base Rate or the Canadian Base Rate shall be, in each case, computed on the
basis of a year of 365 days (or 366 days in a leap year) and, in each case,
shall be payable for the actual number of days elapsed (including the first day
(which, in the case of any Loan made under the Original Credit Agreement and
continuing under this Agreement, as contemplated by Section 2.01, shall be
the day on which such Loan was made under the Original Credit Agreement) but
excluding the last day).  The applicable
Alternate Base Rate, U.S. Base Rate, Canadian Base Rate and Adjusted LIBO Rate
shall be determined by the Administrative Agent and such determination shall be
conclusive absent manifest error.

 

(f)  Solely for
purposes of the Interest Act (Canada), (i) whenever any interest or fee
under this Agreement is calculated using a rate based on a year of 360 days or
365 days, as the case may be, the rate determined pursuant to such calculation,
when expressed as an annual rate, is equivalent to the applicable rate based on
a year of 360 days or 365 days, as the case may be, multiplied by a
fraction, the numerator of which is the actual number of days in the calendar
year in which the period for which such interest or fee is payable (or
compounded) ends and the denominator of which is 360 or 365, as the case may
be, (ii) the rates of interest under this Agreement are nominal rates and
not effective rates or yields and (iii) the principle of deemed
reinvestment of interest does not apply to any interest calculation under this
Agreement.

 

(g)  For purposes of
clarification, any interest required to be paid under this Section 2.13
for any portion of a payment period that occurs prior to the Restatement
Effective Date shall, solely with respect to such portion of such payment
period, be determined in the manner and in accordance with the terms set forth
in Section 2.13 of the Original Credit Agreement (giving effect to any
defined term used in such Section 2.13 as such term is defined in the
Original Credit Agreement).

 

SECTION 2.14.  Alternate Rate of Interest.  If prior to the commencement of any Interest 

 

68

 

Period for a Eurodollar
Borrowing:

 

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

 

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

 

then the Administrative Agent shall give
notice thereof to the applicable Borrower and the Lenders by telephone or
facsimile as promptly as practicable thereafter and, until the Administrative
Agent notifies the applicable Borrower and the Lenders that the circumstances
giving rise to such notice no longer exist, (i) any Interest Election
Request that requests the conversion of any Borrowing to, or continuation of
any Borrowing as, a Eurodollar Borrowing shall be ineffective, and (ii) if
any Borrowing Request requests a Eurodollar Borrowing, such Borrowing shall be
made as (A) in the case of a Borrowing Request made by the Parent Borrower,
an ABR Borrowing, and (B) in the case of a Borrowing Request made by the
Canadian Subsidiary Borrower denominated in U.S. Dollars, a U.S. Base Rate
Revolving Borrowing.

 

SECTION 2.15.  Increased Costs.  (a)  If any Change in Law shall:

 

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

 

(ii) impose on any Lender or the Issuing
Bank or the London interbank market any other condition affecting this
Agreement or Eurodollar Loans or B/A Drawings made by such Lender or any Letter
of Credit or participation therein,

 

and the result of any of the foregoing shall
be to increase the cost to such Lender of making or maintaining any Eurodollar
Loan or obtaining funds for the purchase of B/As (or of maintaining its
obligation to make any such Loan or to accept and purchase B/As) or to increase
the cost to such Lender or the Issuing Bank of participating in, issuing or
maintaining any Letter of Credit or to reduce the amount of any sum received or
receivable by such Lender or the Issuing Bank hereunder (whether of principal,
interest or otherwise), then the applicable Borrower will pay to such Lender or
the Issuing Bank, as the case may be, such additional amount or amounts as will
compensate such Lender or the Issuing Bank, as the case may be, for such
additional costs incurred or reduction suffered.

 

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

 

69

 

(c)  A certificate of a
Lender or the Issuing Bank setting forth the amount or amounts necessary to
compensate such Lender or the Issuing Bank or its holding company in reasonable
detail, as the case may be, as specified in paragraph (a) or (b) of
this Section 2.15, shall be delivered to the applicable Borrower and shall
be conclusive absent manifest error.  The
applicable Borrower shall pay such Lender or the Issuing Bank, as the case may
be, the amount shown as due on any such certificate within 10 days after
receipt thereof.

 

(d)  Failure or delay
on the part of any Lender or the Issuing Bank to demand compensation pursuant
to this Section 2.15 shall not constitute a waiver of such Lender’s or the
Issuing Bank’s right to demand such compensation, provided that no
Borrower shall be required to compensate a Lender or the Issuing Bank pursuant
to this Section 2.15 for any increased costs or reductions incurred more
than 180 days prior to the date that such Lender or the Issuing Bank, as the
case may be, notifies such Borrower of the Change in Law giving rise to such
increased costs or reductions and of such Lender’s or the Issuing Bank’s
intention to claim compensation therefor; provided  further that
if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the 180-day period referred to above shall be extended to
include the period of retroactive effect thereof.

 

SECTION 2.16.  Break Funding Payments.  In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default), (b) the
conversion of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto, (c) the failure to borrow, convert, continue or
prepay any Eurodollar Loan or to issue B/As for acceptance and purchase on the
date specified in any notice delivered pursuant hereto (regardless of whether
such notice may be revoked under Section 2.11(d) and is revoked in
accordance therewith), or (d) the assignment of any Eurodollar Loan or
right to receive payment in respect of a B/A other than on the last day of the
Interest Period or Contract Period applicable thereto as a result of a request
by the applicable Borrower pursuant to Section 2.19, then, in any such
event, the applicable Borrower shall compensate each Lender for the loss, cost
and expense attributable to such event. 
In the case of a Eurodollar Loan, such loss, cost or expense to any Lender
shall be deemed to include an amount determined by such Lender to be the
excess, if any, of (i) the amount of interest which would have accrued on
the principal amount of such Loan had such event not occurred, at the Adjusted
LIBO Rate that would have been applicable to such Loan, for the period from the
date of such event to the last day of the then current Interest Period therefor
(or, in the case of a failure to borrow, convert or continue, for the period
that would have been the Interest Period for such Loan), over (ii) the
amount of interest which would accrue on such principal amount for such period
at the interest rate which such Lender would bid were it to bid, at the
commencement of such period, for dollar deposits of a comparable amount and
period from other banks in the Eurodollar market.  A certificate of any Lender setting forth any
amount or amounts that such Lender is entitled to receive pursuant to this Section 2.16
shall be delivered to the applicable Borrower and shall be conclusive absent
manifest error.  The applicable Borrower
shall pay such Lender the amount shown as due on any such certificate within 10
Business Days after receipt thereof.

 

SECTION 2.17.  Taxes. 
(a)  Any and all payments by or on account of any obligation of any
Loan Party under any Loan Document shall be made free and clear of and without
deduction for any Indemnified Taxes or Other Taxes, provided that if any
Loan Party shall be required to deduct any Indemnified Taxes, Other Taxes or
Excluded Taxes from such payments, then (i) in the case of Indemnified
Taxes and Other Taxes, the sum payable shall be increased as necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section 2.17) the Administrative Agent,
Issuing Bank or Lender (as the case may be) receives an amount equal to the sum
it would have received had no such deductions been made, (ii) such Loan
Party shall make such deductions and (iii) such Loan Party shall pay the
full amount deducted to the relevant Governmental Authority in accordance with
and within the time required by applicable law.

 

70

 

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

 

(c)  Each Loan Party
shall indemnify the Administrative Agent, the Issuing Bank and each Lender,
within 10 days after written demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes paid by the Administrative Agent, the Issuing
Bank or such Lender, as the case may be, on or with respect to any payment by
or on account of any obligation of such Loan Party under any Loan Document
(including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section 2.17) and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such
payment or liability delivered to the applicable Loan Party by the Issuing Bank
or a Lender, or by the Administrative Agent on its own behalf or on behalf of a
Lender or the Issuing Bank, shall be conclusive absent manifest error.

 

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

 

(e)  The Administrative
Agent, the Issuing Bank or any Lender that is entitled to an exemption from or
reduction of withholding tax under the law of the jurisdiction in which the
applicable Borrower is resident, or any treaty to which such jurisdiction is a
party, with respect to payments under this Agreement shall deliver to such
Borrower (in the case of the Issuing Bank or such Lender, with a copy to the
Administrative Agent), at the time or times prescribed by applicable law, such
properly completed and executed documentation prescribed by applicable law, if
any, or reasonably requested by such Borrower as will permit such payments to
be made without withholding or at a reduced rate, provided that the
Administrative Agent, the Issuing Bank or such Lender has received written
notice from such Borrower advising it of the availability of such exemption and
supplying all applicable documentation. 
The Administrative Agent, the Issuing Bank or such Lender, as the case
may be, shall cooperate with the applicable Borrower in good faith to identify
the potential availability of such exemption or reduction.

 

(f) 
If the Administrative Agent, the Issuing Bank or a Lender, as the case may be,
determines, in its sole discretion, that it has received a refund of any
Indemnified Taxes or Other Taxes as to which it has been indemnified by any
Loan Party or with respect to which any Loan Party has paid additional amounts
pursuant to this Section 2.17, it shall pay over such refund to such Loan
Party (but only to the extent of indemnity payments made, or additional amounts
paid, by such Loan Party under this Section 2.17 with respect to the
Indemnified Taxes or Other Taxes giving rise to such refund), net of all
out-of-pocket expenses of the Administrative Agent, the Issuing Bank or such
Lender and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund), provided that such
Loan Party, upon the request of the Administrative Agent, the Issuing Bank or
such Lender, as the case may be, agrees to repay the amount paid over to such
Loan Party (plus any penalties, interest or other charges imposed by the
relevant Governmental Authority) to the Administrative Agent, the Issuing Bank
or such Lender in the event the Administrative Agent, the Issuing Bank or such
Lender, as the case may be, is required to repay such refund to such
Governmental Authority.  This Section 2.17
shall not be construed to require the Administrative Agent, the Issuing Bank or
any Lender to make available its tax returns (or any other information relating
to its taxes which it deems confidential) to any Loan Party or any other
Person.

 

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(g)  If the Canadian
Subsidiary Borrower or any Canadian Subsidiary Loan Party shall receive an
assessment, reassessment or similar document assessing taxes whereby the
Canadian Subsidiary Borrower or such Canadian Subsidiary Loan Party shall be
required to pay any Excluded Taxes referred to in paragraph (e) of
the definition of “Excluded Taxes” in Section 1.01 as a result of the
Canadian Subsidiary Borrower or such Canadian Subsidiary Loan Party having paid
or credited (or been deemed to have paid or credited) an amount hereunder to a
Lender or other Person that is not a Canadian Resident, and such taxes were not
withheld from payments made hereunder in accordance with applicable law, then
such Lender or other Person shall promptly upon written demand therefor
reimburse the Canadian Subsidiary Borrower or such Canadian Subsidiary Loan
Party for the full amount of such Excluded Taxes.

 

(h)  The Canadian
Subsidiary Borrower shall, upon request, cooperate in good faith with the
Administrative Agent, the Issuing Bank or the applicable Lender, as the case
may be, in seeking a recovery of any Excluded Taxes remitted by the Canadian
Subsidiary Borrower or any Canadian Subsidiary Loan Party on behalf of such
Persons to a Governmental Authority in accordance with this Agreement.

 

SECTION 2.18.  Payments Generally; Pro Rata Treatment;
Sharing of Set-offs.  (a)  Each
Borrower shall make each payment required to be made by it under any Loan
Document (whether of principal, amounts owing in respect of B/A Drawings,
interest, fees or reimbursement of L/C Disbursements, or of amounts payable
under Section 2.15, 2.16 or 2.17, or otherwise) prior to the time
expressly required under such Loan Document for such payment (or, if no such
time is expressly required, prior to 12:00 noon, Local Time), on the date when
due, in immediately available funds, without set-off or counterclaim.  Any amounts received after such time on any
date may, in the discretion of the Administrative Agent, be deemed to have been
received on the next succeeding Business Day for purposes of calculating
interest thereon.  All such payments
(other than those required to be made to the Prepayment Account) shall be made
to the Administrative Agent at its offices at 270 Park Avenue, New York, New
York 10017 (or, in the case of payments made in respect of the Canadian
Obligations, to the Administrative Agent at its offices at 200 Bay Street, 18th
Floor, Royal Bank Plaza, South Tower, Toronto, Ontario M5J 2J2), except
payments to be made directly to the Issuing Bank or Swingline Lender as
expressly provided herein and except that payments pursuant to Sections 2.15, 2.16,
2.17 and 9.03 shall be made directly to the Persons entitled thereto and
payments pursuant to other Loan Documents shall be made directly to the Persons
specified therein.  The Administrative
Agent shall distribute any such payments received by it for the account of any
other Person to the appropriate recipient promptly following receipt
thereof.  If any payment under any Loan
Document shall be due on a day that is not a Business Day, the date for payment
shall be extended to the next succeeding Business Day, and, in the case of any
payment accruing interest, interest thereon shall be payable for the period of
such extension.  All payments under each
Loan Document of principal or interest in respect of any Loan or amounts owing
in respect of any B/A Drawing (or of any breakage indemnity in respect of any
Loan or B/A Drawing) shall be made in the currency of such Loan or B/A Drawing;
all other payments under each Loan Document shall be made in U.S. Dollars,
except as otherwise expressly provided therein. 
At all times that full cash dominion is in effect pursuant to Section 3.06
of the Domestic Security Agreement and the Canadian Security Agreement (or the
applicable provisions, if any, of the other Collateral Documents), solely for
purposes of determining the amount of Loans available for borrowing purposes or
B/As available for drawing, checks and cash or other immediately available
funds from collections of items of payment and proceeds of any Collateral shall
be applied in whole or in part against the Obligations, on the day of receipt,
subject to actual collection.

 

(b)  If at any time
insufficient funds are received by and available to the Administrative Agent to
pay fully all amounts of principal, amounts owing in respect of B/A Drawings,
unreimbursed L/C Disbursements, interest and fees then due hereunder, such
funds shall be applied (i) first, towards 

 

72

 

payment of interest and fees
then due hereunder, ratably among the parties entitled thereto in accordance
with the amounts of interest and fees then due to such parties (based on the
U.S. Dollar Equivalent of such amounts or the U.S. Dollar amount thereof, as
applicable), and (ii) second, towards the payment of principal, amounts
owing in respect of B/A Drawings and unreimbursed L/C Disbursements then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of principal, face amounts of B/As and amounts of unreimbursed L/C
Disbursements then due to such parties (based on the U.S. Dollar Equivalent of
such amounts or the U.S. Dollar amount thereof, as applicable), except that, in
the case of any such payment of funds by a Foreign Loan Guarantor on behalf of
the Canadian Subsidiary Borrower, the application of such funds set out in
clauses (i) and (ii) of this Section 2.18(b) may be
reversed in the Administrative Agent’s sole discretion.

 

(c)  At the election of
the Administrative Agent, all payments of principal, interest, amounts owing in
respect of any B/A Drawing, L/C Disbursements, fees, premiums, reimbursable
expenses (including, without limitation, all reimbursement for fees and
expenses pursuant to Section 9.03), and other sums payable under the Loan
Documents (in each case, solely to the extent such amounts are payable to the
Revolving Lenders), may be paid from the proceeds of Borrowings or B/A Drawings
made hereunder, whether made following a request by the applicable Borrower
pursuant to Section 2.03 or Section 2.06, as applicable, or deemed a
request as provided in this Section 2.18, or may be deducted from any
deposit account of the applicable Borrower maintained with the Administrative
Agent.  Each Borrower hereby irrevocably
authorizes (i) the Administrative Agent to make a Borrowing for the
purpose of paying each payment of principal, interest, fees and any other
amount as it becomes due under any Loan Document and agrees that all such
amounts charged shall constitute Loans (including Swingline Loans) and that all
such Borrowings shall be deemed to have been requested pursuant to Sections
2.03, 2.04 or 2.05, as applicable, and (ii) the Administrative Agent to
charge any deposit account of such Borrower maintained with the Administrative
Agent for each payment of principal, interest, fees and any other amount due
under any Loan Document.

 

(d)  If any Revolving
Lender shall, by exercising any right of set-off or counterclaim or otherwise,
obtain payment in respect of any principal of or interest on any of its
Revolving Loans, amounts owing in respect of B/A Drawings or participations in
L/C Disbursements or Swingline Loans resulting in such Lender receiving payment
of a greater proportion of the aggregate amount of its Revolving Loans, amounts
owing in respect of B/A Drawings and participations in L/C Disbursements and
Swingline Loans and accrued interest thereon than the proportion received by
any other Revolving Lender, then the Revolving Lender receiving such greater
proportion shall purchase (for cash at face value) participations in the
Revolving Loans, amounts owing in respect of B/A Drawings and participations in
L/C Disbursements and Swingline Loans of other Revolving Lenders to the extent
necessary so that the benefit of all such payments shall be shared by the
Revolving Lenders ratably in accordance with the aggregate amount of principal
of and accrued interest on their respective Revolving Loans, amounts owing in
respect of B/A Drawings and participations in L/C Disbursements and Swingline
Loans, provided that (i) if any such participations are purchased
and all or any portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to the extent
of such recovery, without interest, and (ii) the provisions of this
paragraph shall not be construed to apply to any payment made by any Borrower
pursuant to and in accordance with the express terms of this Agreement or any
payment obtained by a Revolving Lender as consideration for the assignment of
or sale of a participation in any of its Loans or participations in L/C
Disbursements to any assignee or participant, other than to the Parent Borrower
or any Subsidiary or Affiliate thereof (as to which the provisions of this
paragraph shall apply).  Each Borrower
consents to the foregoing and agrees, to the extent it may effectively do so
under applicable law, that any Revolving Lender acquiring a participation
pursuant to the foregoing arrangements may exercise against such Borrower
rights of set-off and counterclaim with respect to such participation as fully
as if such Lender were a direct creditor of such Borrower in the amount of such
participation.

 

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(e)  If any Term Lender
shall, by exercising any right of set-off or counterclaim or otherwise, obtain
payment in respect of any principal of or interest on any of its Term Loans
resulting in such Lender receiving payment of a greater proportion of the
aggregate amount of its Term Loans and accrued interest thereon than the
proportion received by any other Term Lender, then the Term Lender receiving
such greater proportion shall purchase (for cash at face value) participations
in the Term Loans of other Term Lenders to the extent necessary so that the
benefit of all such payments shall be shared by the Term Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Term Loans, provided that (i) if any such
participations are purchased and all or any portion of the payment giving rise
thereto is recovered, such participations shall be rescinded and the purchase
price restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph shall not be construed to apply to any payment
made by any Borrower pursuant to and in accordance with the express terms of
this Agreement or any payment obtained by a Term Lender as consideration for
the assignment of or sale of a participation in any of its Loans to any
assignee or participant, other than to the Parent Borrower or any Subsidiary thereof
(as to which the provisions of this paragraph shall apply).  Each Borrower consents to the foregoing and
agrees, to the extent it may effectively do so under applicable law, that any
Term Lender acquiring a participation pursuant to the foregoing arrangements
may exercise against such Borrower rights of set-off and counterclaim with
respect to such participation as fully as if such Lender were a direct creditor
of such Borrower in the amount of such participation.

 

(f)  Unless the
Administrative Agent shall have received notice from the applicable Borrower
prior to the date on which any payment is due to the Administrative Agent for
the account of the Lenders or the Issuing Bank hereunder that such Borrower
will not make such payment, the Administrative Agent may assume that such
Borrower has made such payment on such date in accordance herewith and may, in
reliance upon such assumption, distribute to the Lenders or the Issuing Bank,
as the case may be, the amount due.  In
such event, if the applicable Borrower has not in fact made such payment, then
each of the Lenders or the Issuing Bank, as the case may be, severally agrees
to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender or Issuing Bank with interest thereon, for each day
from and including the date such amount is distributed to it to but excluding
the date of payment to the Administrative Agent, at the greater of (i)(A) in
the case of Loans made to the Parent Borrower or U.S. L/C Disbursements, the
Federal Funds Effective Rate, or (B) in the case of Loans made to the
Canadian Subsidiary Borrower, Canadian L/C Disbursements or amounts owing in
respect of B/A Drawings, the rate reasonably determined by the Administrative
Agent to be the cost to it of funding such amount, and (ii) a rate
determined by the Administrative Agent in accordance with banking industry rules on
interbank compensation.

 

(g)  If any Lender
shall fail to make any payment required to be made by it pursuant to Section 2.04(c),
Section 2.05(d) or (e), Section 2.06(f), Section 2.07(a) or
(b), Section 2.18(f) or Section 9.03(c), then the Administrative
Agent may, in its discretion (notwithstanding any contrary provision hereof),
apply any amounts thereafter received by the Administrative Agent for the
account of such Lender to satisfy such Lender’s obligations under such Sections
until all such unsatisfied obligations are fully paid.

 

SECTION 2.19.  Mitigation Obligations; Replacement of
Lenders.  (a)  If any Lender
requests compensation under Section 2.15, or if any Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.17, then
such Lender shall use reasonable efforts to designate a different lending office
for funding or booking its Loans hereunder or to assign its rights and
obligations hereunder to another of its offices, branches or affiliates, if, in
the reasonable judgment of such Lender, such designation or assignment (i) would
eliminate or reduce amounts payable pursuant to Section 2.15 or 2.17, as
the case may be, in the future and (ii) would not subject such Lender to
any unreimbursed cost or expense and would not otherwise be 

 

74

 

disadvantageous to such
Lender.  Each Borrower hereby agrees to
pay all reasonable costs and expenses incurred by any Lender in connection with
any such designation or assignment.

 

(b)  If any Lender
requests compensation under Section 2.15, or if any Borrower is required
to pay any additional amount to any Lender or any Governmental Authority for
the account of any Lender pursuant to Section 2.17, or if any Lender
defaults in its obligation to fund Loans hereunder, then the applicable
Borrower may, at its sole expense and effort, upon notice to such Lender and
the Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in Section 9.04),
all its interests, rights and obligations under this Agreement to an assignee
that shall assume such obligations (which assignee may be another Lender, if a
Lender accepts such assignment), provided that (i) the applicable
Borrower shall have received the prior written consent of the Administrative Agent
and the Issuing Bank, which consent shall not unreasonably be withheld, (ii) such
Lender shall have received payment of an amount equal to the outstanding
principal amount of its Loans, amounts owing in respect of B/A Drawings and
participations in L/C Disbursements and Swingline Loans, accrued interest
thereon, accrued fees and all other amounts payable to it under any Loan
Document, from the assignee (to the extent of such outstanding principal,
amounts owing in respect of B/A Drawings and accrued interest and fees) or the
applicable Borrower (in the case of all other amounts) and (iii) in the
case of any such assignment resulting from a claim for compensation under Section 2.15
or payments required to be made pursuant to Section 2.17, such assignment will
result in a reduction in such compensation or payments.  A Lender shall not be required to make any
such assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the applicable Borrower
to require such assignment and delegation cease to apply.

 

SECTION 2.20.  Returned Payments.  If after receipt of any payment which is
applied to the payment of all or any part of the Obligations, the
Administrative Agent or any Lender is for any reason compelled to surrender
such payment or proceeds to any Person because such payment or application of
proceeds is invalidated, declared fraudulent, set aside, determined to be void
or voidable as a preference, impermissible setoff, or a diversion of trust
funds, or for any other reason, then the Obligations or part thereof intended
to be satisfied shall be revived and continued and this Agreement shall
continue in full force as if such payment or proceeds had not been received by
the Administrative Agent or such Lender. 
The provisions of this Section 2.20 shall be and remain effective
notwithstanding any contrary action which may have been taken by the
Administrative Agent or any Lender in reliance upon such payment or application
of proceeds.  The provisions of this Section 2.20
shall survive the termination of this Agreement.

 

SECTION 2.21.  Revolving Commitment Increases;
Incremental Term Loans.  (a)  At
any time and from time to time during the Availability Period, but in any
event, no more than two times during the Availability Period, the Parent
Borrower may, by notice to the Administrative Agent (whereupon the
Administrative Agent shall promptly deliver a copy of such notice to each of
the Lenders), request to add (x) one or more increases in the aggregate
amount of the Revolving Commitments (each such increase, a “Revolving
Commitment Increase”) having terms identical to the existing Revolving
Commitments or (y) one or more additional tranches of term loans (the “Incremental
Term Loans”), provided that at the time of each such request and
upon the effectiveness of each Commitment Increase Amendment (as defined
below), (i) no Default has occurred and is continuing or shall result
therefrom, (ii) solely with respect to any Revolving Commitment Increase, the
Parent Borrower shall be in compliance on a pro forma basis with the covenant
contained in Section 6.12 recomputed as of the last day of the
most-recently ended fiscal quarter of the Parent Borrower and (iii) the
Parent Borrower shall have delivered a certificate of a Financial Officer to
the effect set forth in clauses (i) and, solely with respect to any
Revolving Commitment Increase, (ii) above, together with reasonably
detailed calculations demonstrating compliance with clause (ii) above.  Notwithstanding anything to contrary herein,
the aggregate principal amount of (A) the Revolving Commitment Increases
shall not 

 

75

 

exceed $40,000,000 and (B) the
Incremental Term Loans shall not exceed $15,000,000.  Each Revolving Commitment Increase shall be in
an integral multiple of $2,000,000 and be in an aggregate principal amount that
is not less than $15,000,000, provided that such amount may be less than
$15,000,000 if such amount represents all the remaining availability under the
aggregate principal amount of Revolving Commitment Increases set forth
above.  Each Incremental Term Loan shall
be in an integral multiple of $1,000,000 and be in an aggregate principal
amount that is not less than $2,000,000, provided that such amount may
be less than $2,000,000 if such amount represents all the remaining
availability under the aggregate principal amount of the Incremental Term Loans
set forth above.

 

(b)  The Incremental
Term Loans (i) shall rank pari  passu in right of payment in
respect of the Collateral and with the Obligations in respect of the Initial
Term Loan, (ii) for purposes of prepayments, shall be treated
substantially the same as (and in any case no more favorably than) the Initial
Term Loan and (iii) shall have terms no less favorable to the Revolving
Lenders than the Initial Term Loan.

 

(c)  Each notice from
the Parent Borrower pursuant to this Section 2.21 shall set forth the
requested amount of the relevant Revolving Commitment Increases or Incremental
Term Loans.  Any additional bank,
financial institution, existing Lender or other Person that elects to extend a
Revolving Commitment Increase shall be reasonably satisfactory to the Parent
Borrower, the Administrative Agent and the Issuing Bank (any such bank,
financial institution, existing Lender or other Person being called an “Additional
Lender”) and, if not already a Lender, shall become a Lender under this
Agreement pursuant to an amendment (a “Commitment Increase Amendment”)
to this Agreement and, as appropriate, the other Loan Documents, executed by
Holdings, the Parent Borrower, such Additional Lender and the Administrative
Agent.  Any Incremental Term Loan shall
be made only by the Initial Term Lender or a Sponsor Affiliate.  No Lender shall be obligated to provide any
Revolving Commitment Increase or Incremental Term Loan unless it so
agrees.  Commitments in respect of any
Revolving Commitment Increase or Incremental Term Loan shall become Commitments
(or in the case of any Revolving Commitment Increase to be provided by an
existing Revolving Lender, an increase in the Revolving Commitment of such
Lender) under this Agreement.  A
Commitment Increase Amendment may, without the consent of any other Lenders, effect
such amendments to any Loan Documents as may be necessary or appropriate, in
the opinion of the Administrative Agent, to effect the provisions of this Section 2.21.  The effectiveness of any Commitment Increase
Amendment shall, unless otherwise agreed to by the Administrative Agent and the
Additional Lenders, be subject to the satisfaction of each of the conditions
set forth in Section 4.02 on the date thereof.  The proceeds of (i) any Revolving
Commitment Increases will be used only for working capital and general
corporate purposes and to finance any Permitted Acquisition and (ii) any
Incremental Term Loans will be used only to repay outstanding U.S. Revolving
Loans and fees, costs and expenses in connection with the incurrence of such
Incremental Term Loans.

 

(d)  Upon each
Revolving Commitment Increase pursuant to this Section 2.21, (i) each
Revolving Lender immediately prior to such increase will automatically and
without further act be deemed to have assigned to each Additional Lender, and
each such Additional Lender will automatically and without further act be
deemed to have assumed, a portion of such Revolving Lender’s (x) Canadian
Revolving Sub-Commitment and (y) participations hereunder in outstanding
Letters of Credit and Swingline Loans such that, after giving effect to such
Revolving Commitment Increase and each such deemed assignment and assumption,
the percentage of the aggregate (A) Canadian Revolving Sub-Commitments, (B) outstanding
participations hereunder in Letters of Credit and (C) outstanding
participations hereunder in Swingline Loans, in each case held by each
Revolving Lender (including each such Additional Lender), will equal such
Revolving Lender’s Applicable Percentage and (ii) if, on the date of such
Revolving Commitment Increase, there are any Revolving Loans outstanding or
amounts owing in respect of outstanding B/A Drawings, such Revolving Loans and
amounts owing in respect of outstanding B/A Drawings shall on or prior to the
effectiveness of such Revolving Commitment Increase 

 

76

 

be prepaid from the proceeds
of additional Revolving Loans made and B/As accepted and purchased hereunder
(reflecting such Revolving Commitment Increase), which prepayment shall (x) be
accompanied by accrued interest on the Revolving Loans being prepaid and any
costs incurred by any Lender in accordance with Section 2.16 and (y) in
the case of outstanding B/A Drawings, be done in accordance with Section 2.11(e).  The Administrative Agent and the Lenders
hereby agree that the minimum borrowing, pro  rata borrowing and pro
rata payment requirements contained elsewhere in this Agreement shall
not apply to the transactions effected pursuant to the immediately preceding
sentence.

 

SECTION 2.22.  Delivery of a Borrowing Base Certificate.  Notwithstanding any provision of this
Agreement to the contrary, subsequent to each date on which (x) the Average
Availability or (y) Availability for the preceding period of four consecutive
Business Days, in either case is less than $30,000,000 (each such date, a “Delivery
Trigger Date”), neither Borrower shall be permitted to make a Borrowing,
request the issuance of a Letter of Credit or request an acceptance and
purchase of a B/A pursuant to this Agreement unless such Borrower shall have
delivered to the Administrative Agent a Borrowing Base Certificate pursuant to Section 5.01(f) as
of a date no earlier than seven days prior to the date of such Borrowing; provided,
however, that after the date that is (i) in the case of the first
Delivery Trigger Date, 45 consecutive days after such Delivery Trigger Date, or
(ii) in the case of any subsequent Delivery Trigger Date, 180 consecutive
days after any such Delivery Trigger Date, neither Borrower shall be required
to deliver a Borrowing Base Certificate pursuant to this Section 2.22 if
the Reference Availability following such 45 or 180 consecutive days, as the
case may be, shall have exceeded $35,000,000 for a period of five consecutive
Business Days prior to the date of such Borrowing.

 

ARTICLE III

 

Representations and Warranties

 

Each Loan Party represents and warrants to the Lenders that:

 

SECTION 3.01.  Organization; Powers.  Each of the Loan Parties and each of its
subsidiaries is duly organized, validly existing and, to the extent such
concept is applicable in the corresponding jurisdiction, in good standing under
the laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted and as proposed to be
conducted, to execute, deliver and perform its obligations under each Loan
Document to which it is a party and to effect the Transactions and, except
where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, is qualified to
do business in, and is in good standing in, every jurisdiction where the
conduct of its business requires such qualification.

 

SECTION 3.02.  Authorization; Enforceability.  The Transactions are within each Loan Party’s
corporate (or, to the extent applicable, other organization) powers and have
been duly authorized by all necessary corporate (or, to the extent applicable,
other organization) action and, if required, stockholder action.  The Loan Documents to which each Loan Party
is a party have been duly executed and delivered by such Loan Party and
constitute a legal, valid and binding obligation of such Loan Party,
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors’
rights generally and subject to general principles of equity, regardless of
whether considered in a proceeding in equity or at law.

 

SECTION 3.03.  Governmental Approvals; No Conflicts.  Except as otherwise set forth in Schedule
3.03, the Transactions (a) do not require any material consent or approval
of, registration or filing with, or any other action by, any Governmental
Authority, except (i) such as have been obtained or made and are in full
force and effect and (ii) for filings necessary to perfect Liens created
pursuant to the Loan Documents, (b) will not violate any Requirement of
Law applicable to any Loan Party or any of its 

 

77

 

subsidiaries, (c) will
not violate or result in a default under any material indenture, agreement or
other instrument binding upon any Loan Party or any of its subsidiaries or its
assets, or give rise to a right thereunder to require any payment to be made by
any Loan Party or any of its subsidiaries or give rise to a right of, or result
in, termination, cancelation or acceleration of any obligation thereunder, and (d) will
not result in the creation or imposition of any Lien on any asset of any Loan
Party or any of its subsidiaries, except Liens created pursuant to the Loan
Documents.

 

SECTION 3.04.  Financial Condition; No Material Adverse
Change.  (a)  The Parent
Borrower has heretofore furnished to the Administrative Agent the consolidated
balance sheet and statements of income, stockholders equity and cash flows of
Holdings and its consolidated subsidiaries, in each case (i) as of and for
the fiscal year ended December 31, 2007, reported on by Crowe Chizek and
Company LLC, independent public accountants, and (ii) as of and for the
fiscal quarter ended March 31, 2008, certified by a Financial
Officer.  Such financial statements
present fairly, in all material respects, the financial position and results of
operations and cash flows of Holdings and its consolidated subsidiaries as of such
dates and for such periods and, in the case of the financial statements
referred to in clause (i) above, were prepared in accordance with GAAP,
subject to year-end audit adjustments and the absence of footnotes.

 

(b)  No event, change,
effect or circumstance has occurred that, individually or in the aggregate, has
had, or could reasonably be expected to have, a Material Adverse Effect, since December 31,
2007.

 

SECTION 3.05.  Properties.  (a)  As of the date of this Agreement, Schedule
3.05(a) sets forth the address of each parcel of real property that is
owned or leased by each Loan Party after giving effect to the
Transactions.  Each of such leases and
subleases is valid and enforceable in accordance with its terms and is in full
force and effect, and no default by any party to any such lease or sublease
exists, except any such default that could not reasonably be expected to result
in a Material Adverse Effect.  Each of
the Loan Parties and its subsidiaries has good title to, or valid leasehold
interests in, all its real and personal property material to its business
(including the Mortgaged Properties), except for Permitted Encumbrances and
minor defects in title that do not materially interfere with its ability to
conduct its business as currently conducted or are described in a mortgage policy
of the title insurance or surveys issued in favor of, and accepted by, the
Administrative Agent in respect of any property.

 

(b) 
Each Loan Party and its subsidiaries owns, or is licensed to use, all
trademarks, tradenames, copyrights, patents and other intellectual property material to its business as currently
conducted, a list (correct and complete in all material respects) of which, as
of the date of this Agreement, is set forth on Schedule 3.05(b),
and the use thereof by the Loan Parties and their respective subsidiaries does
not infringe in any material respect upon the rights of any other Person, and,
as of the date of this Agreement, the Loan Parties’ rights thereto are not subject to any licensing agreement or
similar arrangement, except as set forth on Schedule 3.05(b).

 

(c)  As of the
Restatement Effective Date, no Loan Party nor any of its subsidiaries has
received notice of, or, to the knowledge of any Responsible Officer of any Loan
Party or any of its subsidiaries, has knowledge of, any pending or contemplated
condemnation or expropriation proceeding affecting any Mortgaged Property or
any sale or disposition thereof in lieu of condemnation.  Except in respect of any purchase agreement
entered into for Mortgaged Property that does not conflict with the terms
hereof, neither any Mortgaged Property nor any interest therein is subject to
any right of first refusal, option or other contractual right to purchase such
Mortgaged Property or interest therein.

 

SECTION 3.06.  Litigation and Environmental Matters.  (a)  There are no actions, suits or
proceedings by or before any arbitrator or Governmental Authority pending
against or, to the 

 

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knowledge of any Responsible
Officer of any Loan Party or any of its subsidiaries, threatened against or
affecting the Loan Parties or any of their respective subsidiaries (i) that
could reasonably be expected, individually or in the aggregate, to result in a
Material Adverse Effect (other than the Disclosed Matters) or (ii) that
involve any of the Loan Documents or the Transactions.

 

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

 

SECTION 3.07.  Compliance with Laws and Agreements.  Each Loan Party and its subsidiaries is in
compliance with (a) all Requirements of Law applicable to it or its
property and (b) all indentures, agreements and other instruments binding
upon it or its property, except, in the case of each of clauses (a) and
(b), where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.

 

SECTION 3.08.  Investment Company Status.  No Loan Party nor any of its subsidiaries is
an “investment company” as defined in, or subject to regulation under, the
Investment Company Act of 1940.

 

SECTION 3.09.  Taxes. 
Except as set forth on Schedule 3.09, each Loan Party and its
subsidiaries (a) has timely filed or caused to be filed all Tax returns
and reports required to have been filed, except to the extent that failure to
do so could not reasonably be expected to result in a Material Adverse Effect
and (b) has paid or caused to be paid all material Taxes required to have
been paid by it, except Taxes that are being contested in good faith by
appropriate proceedings, provided that such Loan Party or such
subsidiary, as applicable, has set aside on its books adequate reserves as
required by GAAP and the failure to pay such Taxes could not be expected to
result in a Material Adverse Effect.

 

SECTION 3.10.  ERISA. 
(a)  Except as would not reasonably be expected to result in a
Material Adverse Effect, each of the Parent Borrower and its Subsidiaries is in
compliance in all material respects with the applicable provisions of ERISA and
the Code and the regulations thereunder as applicable to any Plan.  No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events
for which liability is reasonably expected to occur, could reasonably be expected
to result in a Material Adverse Effect. 
The present value of all accumulated benefit obligations under all Plans
(based on the assumptions used for purposes of Statement of Financial
Accounting Standards No. 87) did not, as of the date of the most recent
financial statements reflecting such amounts, exceed the fair market value of
the assets of such Plans by an amount that could reasonably be expected to
result in a Material Adverse Effect, and the present value of all accumulated
benefit obligations of all underfunded Plans (based on the assumptions used for
purposes of Statement of Financial Accounting Standards No. 87) did not,
as of the date of the most recent financial statements reflecting such amounts,
exceed by more than $40,000,000 the fair market value of the assets of all such
underfunded Plans.  The minimum funding
standards of ERISA and the Code with respect to each Plan have been satisfied.

 

(b)  Canadian
Benefit and Pension Plans.  The
Canadian Pension Plans are duly registered in accordance with any Requirement
of Law that requires registration and no event has 

 

79

 

occurred which is reasonably
likely to cause the loss of such registered status.  All material obligations of the Borrowers and
each Subsidiary (including fiduciary, funding, investment and administration
obligations) required to be performed in connection with the Canadian Pension
Plans and the funding agreements therefor have been performed in a timely
fashion.  As of the Restatement Effective
Date, there are no outstanding disputes concerning the assets held under the
funding agreements for the Canadian Pension Plans or the Canadian Benefit
Plans.  The funded status, on a partial
wind-up or full wind-up basis, as specified in the attached Schedule 3.10(b),
of each of the Canadian Pension Plans as determined in the actuarial valuations
last filed with the applicable Governmental Authorities prior to the
Restatement Effective Date, which were prepared in accordance with applicable
law and based on methods and assumptions that are consistent with generally
accepted actuarial principles, is set out in Schedule 3.10(b).  To the knowledge of the Loan Parties, except
as set out in Schedule 3.10(b), there has been no full or partial terminations
of any Canadian Pension Plan.  As of the
Restatement Effective Date, except as set out in Schedule 3.10(b), the Loan
Parties have received no inquiries from any Governmental Authority and no
notice of any dispute with respect to the potential application of the decision
of the Supreme Court of Canada in Monsanto Canada Inc. v. Superintendent of
Financial Services (Ontario) [2004], 3 S.C.R. 152 to any Canadian Pension
Plan.  No promises of benefit
improvements under the Canadian Pension Plans or the Canadian Benefit Plans
have been made except where such improvement could not reasonably be expected
to have a Material Adverse Effect.  All
contributions or premiums required to be made or paid by either Borrower or any
Subsidiary to the Canadian Pension Plans, any Canadian Multi-Employer Plan or
the Canadian Benefit Plans have been made or paid in a timely fashion in
accordance with the terms of such plans and all Requirements of Law.  All employee contributions to the Canadian
Pension Plans or the Canadian Benefit Plans by way of authorized payroll
deduction or otherwise have been properly withheld or collected by each of the
Borrowers and the Subsidiaries, as the case may be, and fully paid into such
plans in a timely manner.  Schedule 3.10(b) lists,
as of the Restatement Effective Date, all “participation agreements” entered
into by either Borrower or any Subsidiary and a labor union with respect to
such Borrower or Subsidiary’s participation in a Canadian Multi-Employer Plan
and the most current executed supplement thereto as of the Restatement
Effective Date.  The pension fund under
each Canadian Pension Plan is exempt from the payment of any income tax and, to
the knowledge of the Loan Parties, there are no taxes, penalties or interest
owing in respect of any such pension fund. 
All material reports and disclosures relating to the Canadian Pension
Plans required by such plans and any Requirement of Law to be filed or
distributed have been filed or distributed in a timely manner.

 

SECTION 3.11.  Disclosure.  Neither the Information Memorandum nor any of
the other reports, financial statements, certificates or other information
furnished by or on behalf of any Loan Party to the Administrative Agent or any
Lender in connection with the negotiation of this Agreement or any other Loan
Document (as modified or supplemented by other information so furnished and
excluding information of a general economic or industry-specific nature), when
taken as a whole, contains any material misstatement of fact or omits to state
any material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, provided that
with respect to projected financial information, the Parent Borrower and
Holdings represent only that such information was prepared in good faith based
upon assumptions believed to be reasonable at the time delivered and, if such
projected financial information was delivered prior to the Restatement
Effective Date, as of the Restatement Effective Date.

 

SECTION 3.12.  Solvency.  (a)  To the knowledge of any Loan Party
or any of its subsidiaries, immediately after the consummation of the
Transactions to occur on the Restatement Effective Date, (i) the fair
value of the assets of each Loan Party, at a fair valuation, will exceed its
debts and liabilities, subordinated, contingent or otherwise, (ii) the
present fair saleable value of the property of each Loan Party will be greater
than the amount that will be required to pay the probable liability of its
debts and other liabilities, subordinated, contingent or otherwise, as such
debts and other liabilities become absolute and matured, (iii) each Loan
Party will be able to pay its debts and liabilities, 

 

80

 

subordinated, contingent or
otherwise, as such debts and liabilities become absolute and matured and shall
not have ceased to pay its current obligations in the ordinary course of
business as they generally become due and (iv) each Loan Party will not
have unreasonably small capital with which to conduct the business in which it
is engaged as such business is now conducted and is proposed to be conducted
after the Restatement Effective Date, in each case after giving effect to any
rights of indemnification, contribution or subrogation arising among the
Subsidiary Loan Parties pursuant to any Loan Document or by law.

 

(b)  To the knowledge
of any Loan Party or any of its subsidiaries, no Loan Party intends to, or will
permit any of its subsidiaries to, and no Loan Party believes that it or any of
its subsidiaries will, incur debts beyond its ability to pay such debts as they
mature, taking into account the timing of and amounts of cash to be received by
it or any such subsidiary and the timing of the amounts of cash to be payable
on or in respect of its Indebtedness or the Indebtedness of any such subsidiary
and after giving effect to any rights of indemnification, contribution or
subrogation arising among the Subsidiary Loan Parties pursuant to any Loan
Document or by law.

 

SECTION 3.13.  Insurance.  Schedule 3.13 sets forth a
description of all insurance maintained by or on behalf of the Loan Parties and
their respective subsidiaries as of the Restatement Effective Date.  As of the Restatement Effective Date, all
premiums then due in respect of such insurance have been paid or have been
satisfied by a financing expressly permitted hereunder.  Each Loan Party believes that the insurance
maintained by or on behalf of Loan Parties and its subsidiaries is in such amounts
(with no greater risk retention) and against such risks as is (i) customarily
maintained by companies of established repute engaged in the same or similar
businesses operating in the same or similar locations and (ii) considered
adequate by Holdings and the Parent Borrower.

 

SECTION 3.14.  Capitalization and Subsidiaries.  Holdings does not have any subsidiaries other
than the Parent Borrower and the Subsidiaries. 
Schedule 3.14 sets forth (a) a correct and complete list of
the name and relationship to the Parent Borrower of each Subsidiary, (b) a
true and complete listing of each class of each of the Parent Borrower’s and
each Subsidiary’s authorized Equity Interests, of which all of such issued
shares are validly issued, outstanding, fully paid and non-assessable, and
owned beneficially and of record by the Persons identified on Schedule 3.14,
and (c) the type of entity of the Parent Borrower and each Subsidiary, in
each case as of the Restatement Effective Date. 
All of the issued and outstanding Equity Interests issued by any
Subsidiary that are owned by any Loan Party have been (to the extent such
concepts are relevant with respect to such ownership interests) duly authorized
and issued and are fully paid and non-assessable.

 

SECTION 3.15.  Labor Disputes.  As of the Restatement Effective Date, there
are no strikes, lockouts or slowdowns or any other material labor disputes
against any Loan Party or any of its subsidiaries pending or, to the knowledge
of any Responsible Officer of any Loan Party or any of its subsidiaries,
threatened.  The hours worked by and
payments made to employees of the Loan Parties and their respective
subsidiaries have not been in violation of the Fair Labor Standards Act or any
other applicable federal, state, provincial, local or foreign law dealing with
such matters, except for any such violations that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.  All payments due from any Loan
Party or any of its subsidiaries, or for which any claim may be made against
any Loan Party or any of its subsidiaries, on account of wages and employee
health and welfare insurance and other benefits, have been paid or accrued as a
liability on the books of the Loan Party or such subsidiary, except for any
such failures to do so that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.  There is no organizing activity involving any
Loan Party or any of its subsidiaries pending or, to the knowledge of any
Responsible Officer of any Loan Party or any of its subsidiaries, threatened by
any labor union or group of employees, except those that, in the aggregate,
could not reasonably be expected to have a Material Adverse Effect.  There are no representation proceedings
pending or, to the knowledge of any Loan Party or any of its 

 

81

 

subsidiaries, threatened
with the National Mediation Board, and no labor organization or group of
employees of any Loan Party or any of its subsidiaries has made a pending
demand for recognition, except those that, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.  There are no material complaints or charges
against any Loan Party or any of its subsidiaries pending or, to the knowledge
of any Responsible Officer of any Loan Party or any of its subsidiaries,
threatened to be filed with any Governmental Authority or arbitrator based on,
arising out of, in connection with, or otherwise relating to the employment or
termination of employment by any Loan Party or any of its subsidiaries of any
individual, except those that, in the aggregate, could not reasonably be
expected to have a Material Adverse Effect. 
The consummation of the Transactions will not give rise to any right of
termination or right of renegotiation on the part of any union under any
collective bargaining agreement to which any Loan Party or any of its
subsidiaries is bound.

 

SECTION 3.16.  Indalex UK Limited.  As of the Restatement Effective Date, Indalex
UK Limited does not own, lease, manage or operate any properties or assets
(including cash), other than de minimis properties and assets.

 

ARTICLE IV

 

Conditions

 

SECTION 4.01.  Restatement Effective Date.  The amendment and restatement of the Original
Credit Agreement and the obligations of the Lenders to make Loans and accept
and purchase B/As hereunder and of the Issuing Bank to issue Letters of Credit
hereunder shall not become effective until the date on which each of the
following conditions is satisfied (or waived in accordance with Section 9.02):

 

(a)  Credit Agreement and Loan
Documents.  The Administrative Agent
(or its counsel) shall have received (i) from each Loan Party party hereto
and the Required Restatement Lenders either (A) a counterpart of this
Agreement signed on behalf of such party or (B) written evidence
reasonably satisfactory to the Administrative Agent (which may include
facsimile transmission of a signed signature page of this Agreement) that
such party has signed a counterpart of this Agreement and (ii) duly
executed copies of the other Loan Documents (or any amendment or amendment and
restatement thereof contemplated by this Agreement to be dated the date hereof)
and such other certificates, documents, instruments and agreements as the
Administrative Agent shall reasonably request in connection with the
transactions contemplated by this Agreement and the other Loan Documents,
including any promissory notes requested by a Lender pursuant to Section 2.10(f) payable
to the order of each such requesting Lender.

 

(b)  Legal Opinions.  The Administrative Agent shall have received
a favorable written opinion (addressed to the Administrative Agent and the
Lenders and dated the Restatement Effective Date) of each of (i) Kirkland &
Ellis LLP, counsel for Holdings, the Parent Borrower and the Subsidiaries,
substantially in the form of Exhibit B-1 and (ii) Blake,
Cassels & Graydon LLP, Canadian local counsel for the Canadian
Subsidiary Borrower, substantially in the form of Exhibit B-2.  Each of Holdings and the Parent Borrower
hereby requests such counsel to deliver such opinions.

 

(c)  Closing Certificates; Certified
Certificate of Incorporation; Good Standing Certificates.  The Administrative Agent shall have received (i) a
certificate of each Loan Party, dated the Restatement Effective Date and
executed by its Secretary or Assistant Secretary, which shall (A) certify
the resolutions of its Board of Directors, members or other body authorizing
the execution, delivery and performance of the Loan Documents to which it is a
party, (B) identify by name and title and bear the signatures of the
Financial Officers and any other officers of such Loan Party authorized 

 

82

 

to sign the Loan Documents to which it is a party, and (C) contain
appropriate attachments, including the certificate or articles of incorporation
or organization of each Loan Party certified by the relevant authority of the
jurisdiction of organization of such Loan Party and a true and correct copy of
its by-laws or operating, management or partnership agreement or a statement
that such by-laws or operating, management or partnership agreement has not
been amended or otherwise modified since the Effective Date, and (ii) a
long-form good standing certificate for each Loan Party from its jurisdiction
of organization, all in form and substance reasonably satisfactory to the
Administrative Agent and its counsel.

 

(d)  No Default Certificate.  The Administrative Agent shall have received
a certificate, dated the Restatement Effective Date and signed by a Financial
Officer, (i) stating that, as of the Restatement Effective Date and after
giving effect to the Restatement Transactions, no Default has occurred and is
continuing, (ii) stating that the representations and warranties contained
in Article III that are qualified by materiality shall be true and
correct, and the representations and warranties that are not so qualified shall
be true and correct in all material respects, as of the Restatement Effective
Date, and (iii) certifying any other factual matters as may be reasonably
requested by the Administrative Agent.

 

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

 

(f)  Perfection Certificates; Lien
Searches.  The Administrative Agent
shall have received (i) completed Perfection Certificates, dated the
Restatement Effective Date and signed by a Financial Officer or legal officer
of the Parent Borrower or the Canadian Subsidiary Borrower, as applicable,
together with all attachments contemplated thereby, and (ii) the results
of a recent lien search in (A) each of the jurisdictions where assets of
the Loan Parties are located and (B) the jurisdiction of formation of each
Loan Party, and such search shall reveal no Liens on any of the assets of the
Loan Parties or their respective subsidiaries except for Liens permitted by Section 6.02
or discharged on or prior to the Restatement Effective Date pursuant to
documentation reasonably satisfactory to the Administrative Agent.

 

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

 

(h)  Filings, Registrations and
Recordings.  Each document (including
any financing statement, fixture filing, mortgage, deed of trust or other
document) required by the Collateral Documents or under law or reasonably
requested by the Administrative Agent to be filed, registered or recorded in
order to create or maintain in favor of the Administrative Agent, for the
benefit of the Lenders, a perfected Lien on the Collateral described therein,
prior and superior in right to any other Person (other than with respect to Liens
expressly permitted by Section 6.02), shall be in proper form for filing,
registration or recordation.

 

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

 

83

 

(i) a Mortgage on such property;

 

(ii) evidence that a counterpart of the
Mortgage (or any necessary amendment to any Mortgage existing immediately prior
to the Restatement Effective Date to reflect the consummation of the
Restatement Transactions) has been recorded (or delivered to the title
insurance company to be recorded after the consummation of the Restatement
Transactions) in the place necessary, in the Administrative Agent’s judgment,
to create a valid and enforceable first priority Lien in favor of the
Administrative Agent for the benefit of itself and the Lenders;

 

(iii) ALTA title policy or, in respect
of any Mortgage (other than a Canadian Mortgage) existing immediately prior to
the Restatement Effective Date, a date-down endorsement in respect of the ALTA
title policy delivered to the Administrative Agent in respect of such Mortgage;
and

 

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

 

provided that (A) subject
to Section 5.13, the conditions set forth in this Section 4.01(i) shall
not apply to the Excluded Mortgages and (B) the conditions set forth in
clause (iii) of this Section 4.01(i) in respect of date-down
endorsements shall not apply to any Mortgage if the Administrative Agent shall
determine, in its reasonable discretion, that, as of the Restatement Effective
Date, the cost of satisfying such condition would be excessive in relation to
the benefit to the Lenders of satisfying such condition.

 

(j)  Consummation of Restatement
Transactions.  The Restatement
Transactions shall have been consummated or shall be consummated substantially
simultaneously with the initial funding of the Term Loans on the Restatement
Effective Date in accordance with applicable law

 

(k)  Indebtedness.  After giving effect to the Restatement
Transactions, none of Holdings, the Parent Borrower nor any Subsidiary shall
have outstanding any Indebtedness or any shares of preferred stock, other than (i) the
Loans and other Indebtedness incurred under this Agreement and the other Loan
Documents, (ii) the Senior Secured Notes, (iii) Indebtedness set
forth on Schedule 6.01 and (iv) the other Indebtedness permitted by
Section 6.01.

 

(l)  Consents and Approvals.  All requisite material Governmental
Authorities shall have approved or consented to the Restatement Transactions to
the extent required, all applicable waiting periods (including any extensions
thereof) shall have expired and there shall be no governmental or judicial
action, actual or threatened, that could reasonably be expected to restrain,
prevent or impose materially burdensome conditions on the Restatement
Transactions.

 

(m)  Other Documents.  The Administrative Agent shall have received
such other documents as the Administrative Agent, the Issuing Bank, any Lender
or their respective counsel may have reasonably requested.

 

The Administrative Agent shall notify the
Parent Borrower and the Lenders of the Restatement Effective Date, and such
notice shall be conclusive and binding. 
Notwithstanding the foregoing, the obligations of the Lenders to make
Loans and to accept and purchase B/As and of the Issuing Bank to issue Letters
of Credit hereunder shall not become effective unless each of the foregoing
conditions is satisfied (or waived pursuant to Section 9.02) at or prior
to 5:00 p.m., New York City time, on May 30, 2008 (and, in the
event such conditions are not so satisfied or waived, the Commitments shall
terminate at such time).

 

84

 

SECTION 4.02.  Each Credit Event.  (a)  The obligation of each Lender to
make a Loan on the occasion of any Borrowing and accept and purchase any B/A
and of the Issuing Bank to issue, amend, renew or extend any Letter of Credit,
is subject to the satisfaction of the following conditions:

 

(i) the representations and warranties
of each of the Loan Parties set forth in the Loan Documents that are qualified
by materiality shall be true and correct, and the representations and
warranties that are not so qualified shall be true and correct in all material
respects, in each case on and as of the date of such Borrowing, the date of the
acceptance and purchase of such B/A or the date of issuance, amendment, renewal
or extension of such Letter of Credit, as applicable (other than with respect
to any representation and warranty that expressly relates to an earlier date,
in which case such representation and warranty shall be true and correct, or
true and correct in all material respects, as the case may be, as of such
earlier date); and

 

(ii) at the time of and immediately
after giving effect to such Borrowing, the acceptance and purchase of such B/A
or the issuance, amendment, renewal or extension of such Letter of Credit, as
applicable, no Default shall have occurred and be continuing.

 

Each Borrowing, each acceptance and purchase
of a B/A and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
applicable Borrower on the date thereof as to the matters specified in this Section 4.02(a).

 

(b)  Prior to (i) the making of
each Loan (excluding Swingline Loans), the Administrative Agent shall have
received a Borrowing Request meeting the requirements of Section 2.03, (ii) the
making of each Swingline Loan, the Swingline Lender shall have received a
notice meeting the requirements of Section 2.04(b), (iii) the
acceptance and purchase of each B/A, the Administrative Agent shall have
received a written request meeting the requirements of Section 2.06(c), (iv) the
issuance, amendment, renewal or extension of each Letter of Credit, the
Administrative Agent and the Issuing Bank shall have received a notice meeting
the requirements of Section 2.05(b), and (v) the issuance of each
Letter of Credit, the Issuing Bank shall have received a properly completed
letter of credit application on the Issuing Bank’s standard form.

 

ARTICLE V

 

Affirmative Covenants

 

Until the Commitments have
expired or been terminated and the principal of and interest on each Loan,
amounts owing in respect of B/A Drawings and all fees, expenses and other
amounts payable under any Loan Document shall have been paid in full (other
than Unliquidated Obligations) and all Letters of Credit shall have expired or
terminated (or shall have been cash collateralized or supported by a letter of
credit, in each case reasonably satisfactory to the Administrative Agent) and
all L/C Disbursements and the aggregate face amount due in respect of
outstanding B/As shall have been reimbursed, the Loan Parties covenant and
agree, jointly and severally, with the Lenders that:

 

SECTION 5.01.  Financial Statements; Borrowing Base and
Other Information.  Holdings and the
Parent Borrower will furnish to the Administrative Agent and each Lender:

 

(a) within 95 days after the end of each
fiscal year of the Parent Borrower, the audited consolidated balance sheet and
related statements of income, stockholders’ equity and cash flows for the
Parent Borrower and its consolidated subsidiaries as of the end of and for such
year, setting forth in each case in comparative form the figures for the
previous fiscal year, all reported 

 

85

 

on by Crowe Chizek and Company LLC or other independent public
accountants of recognized national standing (without a “going concern” or like
qualification or exception and without any qualification or exception as to the
scope of such audit) to the effect that such consolidated financial statements
present fairly in all material respects the financial condition and results of
operations of the Parent Borrower and its consolidated subsidiaries on a
consolidated basis in accordance with GAAP consistently applied;

 

(b) within 45 days after the end of
each of the first three fiscal quarters of each fiscal year of the Parent
Borrower, the unaudited consolidated balance sheet and related statements of
income, stockholders’ equity and cash flows for each of the Parent Borrower and
its consolidated subsidiaries, on the one hand, and the Canadian Subsidiary
Borrower and its consolidated subsidiaries, on the other hand, in each case as
of the end of and for such fiscal quarter and the then elapsed portion of the
fiscal year, setting forth in each case in comparative form the figures for the
corresponding period or periods of (or, in the case of the balance sheet, as of
the end of) the previous fiscal year, all certified by a Financial Officer as
presenting fairly in all material respects the financial condition and results
of operations of the Parent Borrower and its consolidated subsidiaries or the
Canadian Subsidiary Borrower and its consolidated subsidiaries, as the case may
be, on a consolidated basis in accordance with GAAP (or, in the case of the
financial statements of the Canadian Subsidiary Borrower and its consolidated
subsidiaries, Canadian GAAP) consistently applied, subject to normal year-end
audit adjustments and the absence of footnotes;

 

(c) within 30 days after the end of each
of the first two fiscal months of each fiscal quarter of the Parent Borrower,
the unaudited consolidated balance sheet and related statements of income,
stockholders’ equity and cash flows for each of the Parent Borrower and its
consolidated subsidiaries, on the one hand, and the Canadian Subsidiary
Borrower and its consolidated subsidiaries, on the other hand, in each case as
of the end of and for such fiscal month and the then elapsed portion of the
fiscal year, setting forth in each case in comparative form the figures for the
corresponding period or periods of (or, in the case of the balance sheet, as of
the end of) the previous fiscal year, all certified by a Financial Officer as
presenting fairly in all material respects the financial condition and results
of operations of the Parent Borrower and its consolidated subsidiaries or the
Canadian Subsidiary Borrower and its consolidated subsidiaries;

 

(d) concurrently with any delivery of
financial statements under clause (a), (b) or (c) above, a
certificate of a Financial Officer in substantially the form of Exhibit D
(i) certifying as to whether a Default has occurred and, if a Default has
occurred, specifying the details thereof and any action taken or proposed to be
taken with respect thereto, (ii) setting forth reasonably detailed
calculations of the Fixed Charge Coverage Ratio as of the last day of the last
fiscal period covered by such financial statements (but only in the event the
Fixed Charge Coverage Ratio is then being tested pursuant to Section 6.12)
and (iii) stating whether any change in GAAP or in the application thereof
has occurred since the date of the audited financial statements referred to in Section 3.04
and, if any such change has occurred, specifying the effect of such change on
the financial statements accompanying such certificate;

 

(e) as soon as available, but in any
event not more than 30 days after the end of each fiscal year of the Parent
Borrower, a copy of the plan and forecast (including a projected consolidated
and consolidating balance sheet, income statement and funds flow statement) of
the Parent Borrower and the Subsidiaries on a consolidated basis for each month
of the upcoming fiscal year (the “Projections”) in form reasonably
satisfactory to the Administrative Agent and, promptly when available, any
significant revisions of such Projections;

 

86

 

(f) as soon as available but in any
event within 10 Business Days following the end of each calendar month, and at
such other times as may be required pursuant to Section 2.22 or as may be
requested by the Administrative Agent, as of the period then ended, a Borrowing
Base Certificate and supporting information in connection therewith, together
with any additional reports with respect to each Borrowing Base as the
Administrative Agent may reasonably request, provided that the Parent
Borrower may, at its election and upon notice to the Administrative Agent,
deliver the Borrowing Base Certificate required by this Section 5.01(f) on
or before the first Friday following the end of each calendar week; provided
further that, following such election, the Parent Borrower shall deliver
the Borrowing Base Certificate on or before the first Friday following the end
of each calendar week until the date that is (i) in the case of the first
of such elections, 45 days, or (ii) in the case of any other subsequent
such election, 180 days, after the date on which the first Borrowing Base
Certificate delivered pursuant to such election is delivered to the
Administrative Agent;

 

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

 

(h) promptly following any written
request therefor from the Administrative Agent (on its own behalf or on behalf
of any Lender), such other information regarding the operations, business
affairs and financial condition of Holdings, the Parent Borrower or any
Subsidiary, or compliance with the terms of this Agreement, as the
Administrative Agent (on its own behalf or on behalf of such Lender) may
reasonably request (including any information required to be provided by the
Parent Borrower and the Canadian Subsidiary Borrower pursuant to Section 9.14);
and

 

(i) promptly after the request by the
Administrative Agent or any Lender, copies of (i) any documents described
in Section 101(k)(1) of ERISA that the Parent Borrower or any of its
ERISA Affiliates may request with respect to any Multiemployer Plan and (ii) any
notices described in Section 101(l)(1) of ERISA that the Parent
Borrower or any of its ERISA Affiliates may request with respect to any
Multiemployer Plan, provided that if the Parent Borrower or any of its
ERISA Affiliates has not requested such documents or notices from the
administrator or sponsor of the applicable Multiemployer Plan, the Parent
Borrower or the applicable ERISA Affiliate shall promptly make a request for
such documents or notices from such administrator or sponsor and shall provide
copies of such documents and notices promptly after receipt thereof.

 

SECTION 5.02.  Notices of Material Events.  Holdings and the Parent Borrower will furnish
to the Administrative Agent (for distribution to each Lender) prompt written
notice of a Responsible Officer’s obtaining knowledge of any of the following:

 

(a) the occurrence of any Default;

 

(b) receipt of any notice of any
governmental investigation or any litigation or proceeding commenced or
threatened against any Loan Party that (i) seeks material damages, (ii) seeks
material injunctive relief, (iii) is asserted or instituted against any
Plan, any Canadian Pension Plan, any Canadian Benefits Plan or, in each case,
its fiduciaries or its assets, (iv) alleges criminal misconduct by any
Loan Party, (v) alleges the material violation of any law regarding, or
seeks material remedies in connection with, any Environmental Laws, (vi) contests
any material tax, fee, assessment or other governmental charge, or (vii) involves
any product recall;

 

87

 

(c) any Lien (other than Liens permitted
hereunder) or claim made or asserted against any of the Collateral;

 

(d) any loss, damage or destruction to
the Collateral in the amount of $5,000,000 or more, whether or not covered by
insurance, or the commencement of any action or proceeding for the taking of
any material portion of or material interest in the Collateral under power of
eminent domain or by condemnation or similar proceeding;

 

(e) any and all default notices received
under or with respect to any leased location or public warehouse where Collateral
is located in excess of $500,000 (which shall be delivered within five Business
Days after receipt thereof);

 

(f) the occurrence of any ERISA Event or
any fact or circumstance that gives rise to a reasonable expectation that any
ERISA Event will occur that, in either case, alone or together with any other
ERISA Events that have occurred or are reasonably expected to occur, could
reasonably be expected to result in material liability of Holdings, the Parent
Borrower and the Subsidiaries;

 

(g) any failure of either Borrower or
any Subsidiary to make any required contribution to any Canadian Pension Plan
or the receipt of any notice from the funding agent for any Canadian Pension
Plan or from any Governmental Authority to such effect that could reasonably be
expected to result in a material liability to Holdings, the Parent Borrower and
the Subsidiaries; and

 

(h) any other development that results
in, or could reasonably be expected to result in, a Material Adverse Effect.

 

Each notice delivered under this Section 5.02
shall be accompanied by a statement of a Financial Officer or other executive
officer of the Parent Borrower setting forth the details of the event or
development requiring such notice and any action taken or proposed to be taken
with respect thereto.

 

SECTION 5.03.  Existence.  Each Loan Party will, and will cause each of
its subsidiaries to, do or cause to be done all things necessary (a) to
preserve, renew and keep in full force and effect (i) its legal existence
and (ii) the rights, qualifications, privileges, permits, franchises,
governmental authorizations, intellectual property rights, licenses and permits
material to the conduct of its business, except, in the case of this subclause
(ii), to the extent that failure to do so could not reasonably be expected to
result in a Material Adverse Effect, and (b) maintain all requisite
authority to conduct its business in each jurisdiction in which its business is
conducted, except, in the case of this clause (b), to the extent that the
failure to do so could not reasonably be expected to result in a Material
Adverse Effect, provided that the foregoing shall not prohibit any
merger, consolidation, liquidation or dissolution permitted under Section 6.03.

 

SECTION 5.04.  Payment of Obligations.  Each Loan Party will, and will cause each of
its subsidiaries to, pay or discharge all Material Indebtedness, all material
Taxes and all other material liabilities and obligations that have resulted, or
may result, in a Lien being imposed on any Loan Party’s assets (other than
Liens expressly permitted by Section 6.02), in each case, before the same
shall become delinquent or in default, except where (a) the validity or
amount thereof is being contested in good faith by appropriate proceedings, (b) such
Loan Party or such subsidiary has set aside on its books adequate reserves with
respect thereto in accordance with GAAP, (c) such contest effectively
suspends collection of the contested obligation and the enforcement of any Lien
securing such obligation and (d) the failure to make payment pending such
contest could not reasonably be expected to result in a Material Adverse

 

88

 

Effect.

 

SECTION 5.05.  Maintenance of Properties.  Each Loan Party will, and will cause each of
its subsidiaries to, keep and maintain all property material to the conduct of
its business in good working order and condition, ordinary wear and tear,
casualty and condemnation excepted.

 

SECTION 5.06.  Books and Records; Inspection Rights.  (a)  Each Loan Party will, and will
cause each of its subsidiaries to, (i) keep proper books of record and
account in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities and (ii) permit
any representatives designated by the Administrative Agent or any Lender
(including employees of the Administrative Agent, any Lender or any
consultants, accountants, lawyers and appraisers retained by the Administrative
Agent), upon reasonable prior notice but not more than two times in any
twelve-month period (unless an Event of Default has occurred and is
continuing), to visit and inspect its properties during normal business hours,
to examine and make extracts from its books and records (including environmental
assessment reports and Phase I or Phase II studies), and to discuss its
affairs, finances and condition with its officers and independent accountants,
all at such reasonable times and as often as reasonably requested, provided
that a representative of the Loan Parties shall have the right to be
present.  After the occurrence and during
the continuance of any Event of Default, each Loan Party shall provide the
Administrative Agent and each Lender with access to its suppliers. The Loan
Parties acknowledge that the Administrative Agent, after exercising its rights
of inspection, may prepare and distribute to the Lenders certain Reports
pertaining to the Loan Parties’ assets for internal use by the Administrative
Agent and the Lenders.

 

(b)  Each Loan Party will,
and will cause each of its subsidiaries to, permit any representatives
designated by the Administrative Agent (including any consultants, accountants,
lawyers and appraisers retained by the Administrative Agent) to conduct
periodic collateral examinations and periodic collateral appraisals of the
Parent Borrower’s and the Canadian Subsidiary Borrower’s computation of their
respective Borrowing Base and the assets included in each such Borrowing Base,
all at such reasonable times and as often as reasonably requested by the
Administrative Agent in its sole discretion; provided, however,
that so long as no Event of Default has occurred and is continuing, the
Administrative Agent shall be limited to (i) three collateral examinations
in any twelve month period and (ii) if the Reference Availability (A) is
equal to or less than $40,000,000 at any time, two collateral appraisals in the
twelve month period commencing at such time or (B) is otherwise, one
collateral appraisal in any twelve month period.  The Parent Borrower shall pay the reasonable
fees and expenses (including internally allocated fees and expenses of
employees of the Administrative Agent) of any such representatives retained by
the Administrative Agent as to which invoices have been furnished to conduct
any such examination or appraisal, including the reasonable fees and expenses
associated with collateral monitoring services performed by the IB ABL
Portfolio Mgmt Group of the Administrative Agent.  The Loan Parties acknowledge that the
Administrative Agent, after exercising its rights with respect to collateral
examinations and collateral appraisals, may prepare and distribute (and, upon
the request of any Lender, will distribute) to the Lenders certain Reports
pertaining to the Loan Parties’ assets for internal use by the Administrative
Agent and the Lenders.  Each of the
Parent Borrower and the Canadian Subsidiary Borrower also agrees to modify or
adjust the computation of its Borrowing Base (which may include maintaining
additional reserves or modifying the eligibility criteria for the components of
the Borrowing Base) to the extent required by the Administrative Agent or the
Required Lenders as a result of any such collateral examination or collateral
appraisal or otherwise.

 

(c)  In the event that
historical accounting practices, systems or reserves relating to the components
of either Borrowing Base are modified in a manner that is adverse to the
Lenders in any material respect, the Parent Borrower and the Canadian
Subsidiary Borrower, as applicable, shall agree to maintain such additional
reserves (for purposes of computing the applicable Borrowing Base) in respect 

 

89

 

of the components of the
applicable Borrowing Base and make such other adjustments to its parameters for
including the components of the applicable Borrowing Base as the Administrative
Agent in its Permitted Discretion shall require based upon such modifications.

 

SECTION 5.07.  Compliance with Laws.  Each Loan Party will, and will cause each of
its subsidiaries to, comply with all Requirements of Law applicable to it or
its property, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.

 

SECTION 5.08.  Use of Proceeds.  The proceeds of the Initial Term Loan shall
be used on the Restatement Effective Date to repay U.S. Revolving Loans and
fees, costs and expenses in connection with the incurrence of such Initial Term
Loan (as well as any amounts payable under Section 2.16 in respect of such
repayment).  The proceeds of the
Revolving Loans and the Swingline Loans shall be used (i) to pay the fees
and expenses in connection with the Transactions, (ii) to pay the Purchase
Price and (iii) for working capital and general corporate purposes of the
applicable Borrower (including any Permitted Acquisition), provided that
no more than $15,000,000 in Revolving Loans and Swingline Loans, in the
aggregate, may be made in respect of the payment of net working capital
adjustments to the Purchase Price required by the Purchase Agreement.  The proceeds of any Incremental Term Loans
shall be used on the date such Incremental Term Loans are made to repay U.S.
Revolving Loans and fees, costs and expenses in connection with the incurrence
of such Incremental Term Loans (as well as any amounts payable under Section 2.16
in respect of such repayment).  No part
of the proceeds of any Loan will be used, whether directly or indirectly, for
any purpose that entails a violation of any of the Regulations of the Board,
including Regulations T, U and X. 
Letters of Credit and B/As will be used only for general corporate
purposes.

 

SECTION 5.09.  Insurance.  Each Loan Party will, and will cause each of
its subsidiaries to, maintain with financially sound and reputable carriers (a) insurance
in such amounts (with no greater risk retention) with customary deductibles and
against such risks (including loss or damage by fire and loss in transit;
theft, burglary, pilferage, larceny, embezzlement, and other criminal
activities; business interruption; and general liability) and such other
hazards, as is (i) customarily maintained by companies of established
repute engaged in the same or similar businesses operating in the same or
similar locations and (ii) considered adequate by Holdings and the Parent
Borrower and (b) all insurance as may be required by law.  Each Loan Party shall, and shall cause each
of its subsidiaries to, (A) cause all such property and property casualty
insurance policies to be endorsed or otherwise amended to include a lender’s
loss payable endorsement, in form and substance reasonably satisfactory to the
Administrative Agent; (B) deliver original or certified copies of all such
policies or a certificate of an insurance broker to the Administrative Agent; (C) cause
each such policy to provide that it shall not be canceled, modified or not
renewed upon less than 30 days’ prior written notice (or 10 days’ prior written
notice in the case of any failure to pay any premium due thereunder) thereof by
the insurer to the Administrative Agent; and (D) deliver to the
Administrative Agent, prior to the cancelation, modification or nonrenewal of
any such policy of insurance, a copy of a renewal or replacement policy (or
other evidence of renewal of a policy previously delivered to the
Administrative Agent), or insurance certificate with respect thereto, together
with evidence reasonably satisfactory to the Administrative Agent of payment of
the premium therefor.  The Parent
Borrower will furnish to the Lenders, upon request of the Administrative Agent,
information in reasonable detail as to the insurance so maintained.  Notwithstanding the foregoing, the provisions
of this Section 5.09 shall not apply to Caradon Lebanon Inc.

 

SECTION 5.10.  Depository Banks.  The Parent Borrower and each Subsidiary will
maintain the Administrative Agent, Bank of America, N.A., Royal Bank of Canada
or such other bank or banks that are reasonably satisfactory to the
Administrative Agent, as its principal depository bank, including for the
maintenance of operating, administrative, cash management, collection activity,
and 

 

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other deposit accounts for
the conduct of its business.

 

SECTION 5.11.  Additional Collateral; Further Assurances.  (a)  To the extent permitted by
applicable law, each Borrower and each Subsidiary Loan Party shall cause each
of its subsidiaries formed or acquired after the date of this Agreement to
become a Loan Party by executing the Joinder Agreement set forth as Exhibit E
hereto (the “Joinder Agreement”). 
Upon execution and delivery thereof, each such Person (i) shall
automatically become a U.S. Loan Guarantor or a Foreign Loan Guarantor, as
applicable, hereunder and thereupon shall have all of the rights, benefits,
duties, and obligations in such capacity under the Loan Documents and (ii) will
grant, by executing the applicable Collateral Documents (or supplements
thereto), Liens to the Administrative Agent, for the benefit of the Administrative
Agent and the Lenders, in any property of such Loan Party that constitutes
Collateral, including any parcel of real property owned by such Loan Party
having a fair market value in excess of $500,000.

 

(b)  To the extent
permitted by applicable law, Holdings, the Parent Borrower and each Domestic
Subsidiary Loan Party will cause (i) 100% of the issued and outstanding
Equity Interests of each Domestic Subsidiary and (ii) 65% (or such greater
percentage that, due to a change in applicable law after the date hereof, (A) could
not reasonably be expected to cause the undistributed earnings of such Foreign
Subsidiary as determined for U.S. Federal income tax purposes to be treated as
a deemed dividend to such Foreign Subsidiary’s U.S. parent and (B) could
not reasonably be expected to cause any material adverse tax consequences) of
the issued and outstanding Equity Interests entitled to vote (within the
meaning of Treas. Reg. Section 1.956-2(c)(2)) and 100% of the issued and
outstanding Equity Interests not entitled to vote (within the meaning of Treas.
Reg. Section 1.956-2(c)(2)) of each Foreign Subsidiary (including the
Canadian Subsidiary Borrower), in each case directly owned by the Parent
Borrower or any such Domestic Subsidiary Loan Party, to be subject at all times
to a first priority, perfected Lien (subject to Permitted Encumbrances) in
favor of the Administrative Agent to secure the Secured Obligations pursuant to
the terms and conditions of the applicable Collateral Document or other security
documents as the Administrative Agent shall reasonably request.

 

(c)  To the extent
permitted by applicable law, Holdings, the Parent Borrower, the Canadian
Subsidiary Borrower and each Subsidiary Loan Party will cause 100% of the
issued and outstanding Equity Interests (other than director’s qualifying
shares) of each Foreign Subsidiary (including the Canadian Subsidiary Borrower
and to the extent not otherwise pledged pursuant to paragraph (b) of this Section 5.11)
to be subject at all times to a first priority, perfected Lien (subject to
Permitted Encumbrances) in favor of the Administrative Agent to secure the
Canadian Secured Obligations pursuant to the terms and conditions of the
applicable Collateral Document or other security documents as the Administrative
Agent shall reasonably request.

 

(d)  Without limiting
the foregoing and to the extent permitted by applicable law, each Loan Party
will, and will cause each of its subsidiaries to, execute and deliver, or cause
to be executed and delivered, to the Administrative Agent such documents,
agreements and instruments, and will take or cause to be taken such further
actions (including the filing and recording of financing statements, fixture
filings, mortgages, deeds of trust and other documents and such other actions
or deliveries of the type required by Section 4.01, as applicable), which
may be required by law or which the Administrative Agent may, from time to
time, reasonably request to carry out the terms and conditions of this
Agreement and the other Loan Documents and to ensure perfection and priority of
the Liens created or intended to be created by the Collateral Documents, all at
the expense of the Loan Parties.

 

(e)  If any material
assets (including any real property having a fair market value in excess of
$500,000 or improvements thereto or any interest therein) are acquired by any
Loan Party after the Restatement Effective Date (other than assets constituting
Collateral under the Collateral Documents that become subject to the Lien
created by the applicable Collateral Document upon acquisition thereof), 

 

91

 

such Loan Party will notify
the Administrative Agent and the Lenders thereof, and, if requested by the
Administrative Agent or the Required Lenders and to the extent permitted by
applicable law, such Loan Party will cause such assets to be subjected to a
Lien securing the Secured Obligations (in the case of assets of Holdings, the
Parent Borrower or any Domestic Subsidiary Loan Party) or the Canadian Secured
Obligations (in the case of assets of the Canadian Subsidiary Borrower or any
Foreign Subsidiary Loan Party) and will take such actions as shall be necessary
or reasonably requested by the Administrative Agent to grant and perfect such
Liens (subject to any exceptions set forth in the Collateral Documents),
including actions described in paragraph (d) of this Section 5.11,
all at the expense of the Loan Parties.

 

(f)  Notwithstanding
the foregoing, the Administrative Agent shall not take a security interest in
those assets as to which the Administrative Agent shall determine, in its
reasonable discretion, that the cost of obtaining such security interest
(including any mortgage, stamp, intangibles or other tax) are excessive in
relation to the benefit to the Lenders of the security afforded thereby.

 

SECTION 5.12.  Purchase Price Adjustment.  Promptly upon the receipt of Purchase Price
Adjustment Proceeds, if any, each Borrower shall make a prepayment pursuant to Section 2.11(a) in
an amount equal to 75% of the Purchase Price Adjustment Proceeds so received by
such Borrower (such amount, the “Prepayment Amount”) or such lesser
amount as may be necessary to prepay in full all outstanding Borrowings and
amounts owed in respect of outstanding B/As, as the case may be, in which case
the Borrowers shall be permitted to use the remaining portion of the Prepayment
Amount for general corporate purposes, including any Permitted
Acquisitions.  The remaining 25% of Purchase
Price Adjustment Proceeds, if any, may be used by the Borrowers in accordance
with Section 6.08(a)(x).

 

SECTION 5.13.  Post-Closing Obligations.  In the event that the property subject to an
Excluded Mortgage has not been sold in accordance with Section 6.05
(including in connection with a sale and leaseback transaction permitted by Section 6.06)
prior to the date that is 90 days after the Restatement Effective Date (or such
longer period as the Administrative Agent, in its reasonable discretion, may
agree after request by the Parent Borrower), Holdings and the Parent Borrower
shall, and shall cause each Subsidiary to, promptly satisfy the conditions set
forth in Section 4.01(i) with respect to such Excluded Mortgage.

 

ARTICLE VI

 

Negative Covenants

 

Until the Commitments have
expired or been terminated and the principal of and interest on each Loan,
amounts owing in respect of B/As and all fees, expenses and other amounts
payable under any Loan Document have been paid in full (other than Unliquidated
Obligations) and all Letters of Credit have expired or terminated (or shall
have been cash collateralized or supported by a letter of credit, in each case
reasonably satisfactory to the Administrative Agent) and all LC Disbursements
and the aggregate face amount due in respect of outstanding B/As shall have
been reimbursed, the Loan Parties covenant and agree, jointly and severally,
with the Lenders that:

 

SECTION 6.01.  Indebtedness.  No Loan Party will, nor will it permit any of
its subsidiaries to, create, incur or suffer to exist any Indebtedness, except:

 

(a) the Secured Obligations;

 

(b) Indebtedness (i) existing on
the Effective Date and set forth in Schedule 6.01 and (ii) of
the Parent Borrower in respect of the Senior Secured Notes in an aggregate
principal amount not to exceed $280,000,000 and, in each case, extensions,
refinancings, renewals and 

 

92

 

replacements of, or exchange for, any such
Indebtedness in accordance with clause (f) of this Section 6.01, provided
that any such refinancing Indebtedness, if secured, is secured on a
second-priority basis only by assets of Holdings, the Parent Borrower and the
Domestic Subsidiary Loan Parties that constitute Collateral for the Secured
Obligations and shall be subject to the Intercreditor Agreement;

 

(c) Indebtedness of the Parent Borrower
to any Subsidiary and of any Subsidiary to the Parent Borrower or any other
Subsidiary, provided that (i) Indebtedness of any Subsidiary that
is not a Loan Party to the Parent Borrower or any Subsidiary Loan Party shall
be subject to Section 6.04 and (ii) Indebtedness of the Parent
Borrower to any Subsidiary and Indebtedness of any Subsidiary that is a Loan
Party to any Subsidiary that is not a Loan Party shall be subordinated to the
Secured Obligations on terms reasonably satisfactory to the Administrative
Agent;

 

(d) Guarantees by (i) the Parent
Borrower of Indebtedness of any Subsidiary and by any Subsidiary of
Indebtedness of the Parent Borrower or any other Subsidiary, provided
that (A) the Indebtedness so Guaranteed is permitted by this Section 6.01
(other than clauses (b)(i), (f), (l) and (q) of this Section 6.01),
(B) Guarantees by the Parent Borrower or any Subsidiary Loan Party of
Indebtedness of any Subsidiary that is not a Loan Party shall be subject to Section 6.04,
(C) Guarantees permitted under this clause (d) shall be
subordinated to the Secured Obligations of the applicable Subsidiary on the
same terms as the Indebtedness so Guaranteed is subordinated to the Secured
Obligations and (D) the Senior Secured Notes shall not be Guaranteed by
any Subsidiary unless such Subsidiary is a Loan Party that has Guaranteed the
Secured Obligations, (ii) Holdings of (A) the Senior Secured Notes to
the extent required by the Senior Secured Notes Documents and (B) any
Indebtedness of any Loan Party in respect of sale and leaseback transactions
permitted by Section 6.06 and (iii) any Subsidiary of Indebtedness of
AAG or any of its subsidiaries to the extent such Guarantees are required by
the AAG Shareholders Agreement, provided that the aggregate principal
amount of the Indebtedness Guaranteed pursuant to this clause (iii) shall
not exceed $12,000,000 at any time outstanding;

 

(e) Indebtedness of the Parent Borrower
or any Subsidiary incurred to finance the acquisition, construction or
improvement of any fixed or capital assets (whether or not constituting
purchase money Indebtedness), including Capital Lease Obligations (other than
Capital Lease Obligations permitted under Section 6.01(j)) and any
Indebtedness assumed by the Parent Borrower or any Subsidiary in connection
with the acquisition of any such assets or secured by a Lien on any such assets
prior to the acquisition thereof, and extensions, refinancings, renewals and
replacements of any such Indebtedness in accordance with clause (f) of
this Section 6.01, provided that (i) such Indebtedness is
incurred prior to or within 90 days after such acquisition or the completion of
such construction or improvement and (ii) the aggregate principal amount
of Indebtedness permitted by this clause (e) (including extensions,
refinancings, renewals, replacements and exchanges) shall not exceed
$15,000,000 at any time outstanding;

 

(f) Indebtedness which represents an
extension, refinancing, renewal or replacement of, or exchange for, any of the
Indebtedness described in clauses (b), (e), (i), (l) and (q) of this Section 6.01,
provided that (i) the principal amount of such Indebtedness does
not exceed the principal amount (plus any accrued but unpaid interest, premium,
fees and expenses) of the Indebtedness being extended, refinanced, renewed or
replaced, (ii) any Liens securing such Indebtedness are (A) in the
case of Indebtedness of any Subsidiary that is not a Loan Party, not extended
to any additional property of any Loan Party and (B) in the case of
Indebtedness of a Loan Party, limited to all or part of the same property that
secured or, pursuant to the written agreement under which the original Lien
arose, was required to secure the original Indebtedness, 

 

93

 

(iii) no Loan Party that is not originally obligated with respect
to repayment of such Indebtedness of a Person that is not a Loan Party is
required to become obligated with respect thereto, (iv) such extension,
refinancing, renewal, replacement or exchange does not result in a shortening
of the average weighted maturity of the Indebtedness so extended, refinanced,
renewed, replaced or exchanged, (v) the terms of any such extension,
refinancing, renewal, replacement or exchange are not materially less favorable
to the obligor thereunder than the original terms of such Indebtedness and (vi) if
the Indebtedness that is extended, refinanced, renewed, replaced or exchanged
was subordinated in right of payment to the Secured Obligations, then the terms
and conditions of the extension, refinancing, renewal, replacement or exchange
Indebtedness must include subordination terms and conditions that are at least
as favorable to the Administrative Agent and the Lenders as those that were
applicable to the extended, refinanced, renewed or replaced Indebtedness;

 

(g) Indebtedness owed to any Person
(including obligations in respect of letters of credit for the benefit of such
Person) providing workers’ compensation, health, disability or other employee
benefits or property, casualty or liability insurance, pursuant to
reimbursement or indemnification obligations to such person, in each case
incurred in the ordinary course of business;

 

(h) Indebtedness of the Parent Borrower
or any Subsidiary in respect of performance bonds, bid bonds, customs bonds,
appeal bonds, surety bonds, performance and completion guarantees and similar
obligations (other than in respect of other Indebtedness), in each case
provided in the ordinary course of business;

 

(i) Indebtedness of any Person that
becomes a Subsidiary after the date hereof, Indebtedness assumed in connection
with a Permitted Acquisition (other than Indebtedness permitted under Section 6.01(c))
and, in each case, extensions, refinancings, renewals and replacements of, and
exchanges for, any such Indebtedness in accordance with clause (f) of this
Section 6.01, provided that (i) such Indebtedness exists at
the time such Person becomes a Subsidiary or at the time such Permitted
Acquisition is consummated and is not created in contemplation of or in
connection with such Person becoming a Subsidiary or the consummation of such
Permitted Acquisition and (ii) the aggregate principal amount of
Indebtedness permitted by this clause (i) (including extensions,
refinancings, renewals, replacements, and exchanges) shall not exceed
$9,000,000 at any time outstanding;

 

(j) Indebtedness (other than
Indebtedness permitted under Section 6.01(e)) arising from sale and
leaseback transactions otherwise permitted pursuant to Section 6.06 in an
aggregate principal amount not to exceed $20,000,000 at any time outstanding;

 

(k) other unsecured Indebtedness
(including any Guarantee of Indebtedness not permitted by clause (d)(iii) of
this Section 6.01) in an aggregate principal amount not exceeding
$13,000,000 at any time outstanding;

 

(l) subordinated Indebtedness of
Holdings incurred to repurchase Equity Interests in a transaction permitted by Section 6.08(a)(iii);

 

(m) Indebtedness in respect of insurance
premium financings;

 

(n) Indebtedness of the Loan Parties in
respect of Swap Agreements to the extent such Swap Agreements are permitted
hereunder;

 

94

 

(o) to the extent constituting
Indebtedness, obligations of the Loan Parties and their subsidiaries under
operating leases;

 

(p) Indebtedness arising from the
honoring by a bank or other financial institution of a check, draft or similar
instrument drawn against insufficient funds in the ordinary course of business
and other Indebtedness arising in connection with banking services provided by
any Person that is not a Lender or an Affiliate of a Lender to the extent such
banking services are provided in the ordinary course of business; provided,
however, that such Indebtedness is extinguished within five Business
Days of its incurrence;

 

(q) (i) unsecured subordinated
Indebtedness of Holdings to holders of Equity Interests in Holdings, or to
financial institutions acting at the direction of such holders, in an aggregate
principal amount of $25,000,000, provided that (A) prior to the
Maturity Date, no interest shall be paid in respect of such Indebtedness (other
than interest payable solely in shares of Qualified Equity Interests or
additional payment-in-kind Indebtedness), (B) such Indebtedness does not
require any scheduled payment of principal (including pursuant to a sinking
fund obligation) or mandatory redemption or redemption at the option of the
holders thereof (except for redemptions in respect of asset sales and changes in
control on terms that are market terms on the date of issuance) prior to the
date that is 180 days after the Maturity Date and (C) such Indebtedness
shall otherwise be on terms reasonably satisfactory to the Administrative
Agent, and (ii) extensions, refinancings, renewals and replacements of, or
exchanges for, any such Indebtedness in accordance with clause (f) of this
Section 6.01;

 

(r) Indebtedness of Foreign Subsidiaries
(other than Canadian Subsidiaries) not to exceed an aggregate principal amount
of $2,000,000 outstanding at any time;

 

(s) Indebtedness arising from agreements
of the Parent Borrower or any Subsidiary to provide indemnification or similar
obligations in connection with the disposition of any business or assets of, or
the acquisition of any business or assets by, the Parent Borrower or such
Subsidiary, as the case may be, to the extent such disposition or acquisition
is permitted hereby, provided that (i) such Indebtedness is not
reflected on the balance sheet of the Parent Borrower or any Subsidiary (it
being understood and agreed that contingent obligations referred to in a
footnote to the financial statements of the Parent Borrower or any Subsidiary
shall not be deemed to be reflected on such balance sheet for purposes of this
clause (i)) and (ii) the maximum assumable liability in respect of all
such Indebtedness shall not exceed the gross proceeds actually received by the
Parent Borrower or the applicable Subsidiary in connection with the applicable
dispositions or the fair market value of the business or assets acquired by the
Parent Borrower or the applicable Subsidiary in connection with the applicable
acquisition, as the case may be; and

 

(t) Indebtedness owed to the Sponsor or
any Sponsor Affiliate in respect of unpaid fees and expenses referenced in Section 6.09(f),

 

provided that the
aggregate principal amount of Indebtedness incurred pursuant to clauses (e) (other
than Indebtedness incurred pursuant to such clause (e) in connection with
a sale and leaseback transaction permitted under Section 6.06), (i) and
(k) of this Section 6.01 shall not exceed (x) in the event that
Reference Availability as of the applicable date of incurrence is less than or
equal to $50,000,000, $25,000,000 as of such date or (y) in the event that
Reference Availability as of the applicable date of incurrence is greater than
$50,000,000, $35,000,000 as of such date; and provided  further
that for purposes of complying with this Section 6.01, Holdings, the
Parent Borrower and the Subsidiaries will be entitled to divide and classify an
item of Indebtedness in more than one of the types of Indebtedness described
above.

 

95

 

SECTION 6.02.  Liens. 
No Loan Party will, nor will it permit any of its subsidiaries to,
create, incur, assume or permit to exist any Lien on any property or asset now
owned or hereafter acquired by it, or assign or sell any income or revenues
(including accounts receivable) or rights in respect of any thereof, except:

 

(a) Liens created pursuant to any Loan
Document;

 

(b) Permitted Encumbrances;

 

(c) any Lien on any property or asset of
the Parent Borrower or any Subsidiary existing on the Effective Date and set
forth in Schedule 6.02, provided that (i) such Lien
shall not apply to any other property or asset of the Parent Borrower or
Subsidiary and (ii) such Lien shall secure only those obligations which it
secures on the date hereof and extensions, refinancings, renewals and
replacements thereof that do not increase the outstanding principal amount
thereof (plus any accrued but unpaid interest and premium);

 

(d) Liens on fixed or capital assets
acquired, constructed or improved (including any such assets made the subject
of a Capital Lease Obligation incurred) by the Parent Borrower or any
Subsidiary, provided that (i) such Liens secure Indebtedness
permitted by Section 6.01(e), (ii) such Liens and the Indebtedness
secured thereby (other than any such Indebtedness that represents interest or
an extension, refinancing, renewal or replacement of the Indebtedness described
in Section 6.01(e)) are incurred prior to or within 90 days after such
acquisition or the completion of such construction or improvement, (iii) the
Indebtedness secured thereby does not exceed $15,000,000 at any time
outstanding and (iv) such Liens shall not apply to any other property or
assets of the Parent Borrower or Subsidiary;

 

(e) any Lien existing on any property or
asset prior to the acquisition thereof by the Parent Borrower or any Subsidiary
or existing on any property or asset of any Person that becomes a Loan Party
after the date hereof prior to the time such Person becomes a Loan Party, provided
that (i) such Lien is not created in contemplation of or in connection
with such acquisition or such Person becoming a Loan Party, as the case may be,
(ii) such Lien shall not apply to any other property or assets of the Loan
Party and (iii) such Lien shall secure only those obligations which it
secures on the date of such acquisition or the date such Person becomes a Loan
Party, as the case may be, and extensions, refinancings, renewals and
replacements thereof that do not increase the outstanding principal amount
thereof (plus any accrued but unpaid interest, premium, fees and expenses);

 

(f) Liens of a collecting bank arising
in the ordinary course of business under Section 4-208 of the Uniform
Commercial Code in effect in the relevant jurisdiction covering only the items
being collected upon;

 

(g) Liens arising out of sale and
leaseback transactions permitted by Section 6.06 (including Liens securing
Indebtedness permitted by Section 6.01(j));

 

(h) Liens granted by (i) a
Subsidiary in favor of the Parent Borrower or another Loan Party in respect of
Indebtedness or other obligations owed by such Subsidiary to the Parent
Borrower or such Loan Party and (ii) a Subsidiary that is not a Loan Party
in favor of another Subsidiary that is not a Loan Party in respect of
Indebtedness or other obligations owed by the first such Subsidiary to the
second such Subsidiary;

 

(i) Liens not otherwise permitted by
this Section 6.02 to the extent that neither (A) the 

 

96

 

aggregate outstanding principal amount of the obligations secured
thereby nor (B) the aggregate fair market value (determined as of the date
such Lien is incurred) of the assets subject thereto exceeds $1,000,000 at any
time outstanding;

 

(j) Liens (i) created by sales
contracts documenting unconsummated asset dispositions permitted hereby and (ii) in
favor of consignors, provided that such Liens attach only to those
assets that are the subject of the applicable sales contract or that are
consigned to the applicable Loan Party or Subsidiary;

 

(k) Liens arising by operation of law or
contract on insurance policies and the proceeds thereof to secure premiums
thereunder;

 

(l) Liens consisting of the interest of (i) the
lessor or sublessor under any lease or sublease entered into by any Loan Party
or any of its subsidiaries in its ordinary course of business and (ii) the
lessee or sublessee under any lease or sublease granted to others by any Loan
Party or any of its subsidiaries in its ordinary course of business;

 

(m) Liens that are rights of set-off or
that arise solely by virtue of any statutory or common law provision relating
to deposit accounts in favor of banks and other depositary institutions arising
in the ordinary course of business;

 

(n) Liens (i) representing the
interest of the licensor or sublicensor under any license or sublicense entered
into by any Loan Party or any of its subsidiaries in its ordinary course of
business and (ii) arising from the granting of a license to any Person in
the ordinary course of business of a Loan Party or any of its subsidiaries, provided
that (A) such Liens attach only to those assets that are the subject of
the applicable license and (B) in the case of subclause (ii), the
granting of such license is permitted hereunder;

 

(o) Liens attaching solely to cash
earnest money deposits in connection with Investments permitted under Section 6.04;

 

(p) Liens on the assets of Foreign
Subsidiaries (other than Canadian Subsidiaries) in an aggregate amount not to
exceed $2,000,000;

 

(q) the filing of UCC financing statements
solely as a precautionary measure in connection with operating leases entered
into by the Parent Borrower or any Subsidiary in its ordinary course of
business;

 

(r) Liens in favor of the issuers of
surety bonds issued for the account of the Parent Borrower or any Subsidiary in
its ordinary course of business;

 

(s) Liens created in connection with (i) banking
services provided to any Loan Party or any subsidiary of a Loan Party by any
Person that is not a Lender or an Affiliate of a Lender or (ii) Swap
Agreements permitted by Section 6.07 and entered into with any Person that
is not a Lender or an Affiliate of a Lender, in each case entered into in the
ordinary course of business;

 

(t) Liens on cash collateral for letters
of credit excluded from the definition of “Indebtedness” pursuant to clause (i)(y) of
such definition, provided that such cash collateral does not exceed
$2,000,000 in the aggregate at any time outstanding; and

 

(u) Liens created under the Senior
Secured Notes Documents, provided that the 

 

97

 

Intercreditor Agreement has been executed by the parties thereto and
delivered to the Administrative Agent.

 

SECTION 6.03.  Fundamental Changes.  (a)  No Loan Party will, nor will it
permit any of its subsidiaries to, merge into or amalgamate or consolidate with
any other Person, or permit any other Person to merge into or amalgamate or
consolidate with it, or liquidate or dissolve, except that, if at the time
thereof and immediately after giving effect thereto no Event of Default shall
have occurred and be continuing (i) any Subsidiary (other than Canadian
Subsidiary Borrower) may merge into the Parent Borrower or the Canadian
Subsidiary Borrower in a transaction in which the Parent Borrower or the
Canadian Subsidiary Borrower, as applicable, is the surviving corporation, (ii) any
Subsidiary may amalgamate with the Canadian Subsidiary Borrower in a
transaction in which the resulting entity becomes, and assumes the rights and
obligations hereunder of, the Canadian Subsidiary Borrower, (iii) any
Subsidiary (other than the Canadian Subsidiary Borrower) may merge into or
amalgamate or consolidate with any Subsidiary Loan Party in a transaction in
which the surviving or resulting entity is a Loan Party, (iv) any
Subsidiary that is not a Loan Party may liquidate, dissolve or merge into or
amalgamate or consolidate with another Subsidiary that is not a Loan Party if
the Parent Borrower determines in good faith that such liquidation,
dissolution, merger, amalgamation or consolidation is in the best interests of
the Parent Borrower and is not materially disadvantageous to the Lenders, and (v) any
Subsidiary that is permitted to be sold in accordance with Section 6.05(o) may
effect such sale by way of merger into or amalgamation or consolidation with
another Person or may otherwise be liquidated or dissolved, provided
that any such merger, amalgamation or consolidation involving a Person that is
not a wholly-owned Subsidiary immediately prior to such merger, amalgamation or
consolidation shall not be permitted unless also permitted by Section 6.04.

 

(b)  The Parent Borrower and the Loan
Parties will not engage to any material extent in any business other than
businesses of the type conducted by the Parent Borrower and the Loan Parties on
the Restatement Effective Date and businesses reasonably related, complementary
or ancillary thereto.

 

(c)  Holdings will not engage in any
business or activity other than the ownership of all the outstanding shares of
capital stock of the Parent Borrower and activities incidental thereto and
compliance with its obligations under the Loan Documents and the Senior Secured
Notes Documents and other activities specifically permitted hereby.  Holdings will not own or acquire any assets
(other than Equity Interests of the Parent Borrower, the cash proceeds of any
Restricted Payments permitted by Section 6.08 and other de minimis assets
held in its ordinary course of business) or incur any liabilities (other than
liabilities under the Loan Documents, liabilities expressly permitted by the
terms hereof (including the Indebtedness of Holdings permitted by Sections
6.01(d), (l) and (q) and other liabilities of Holdings permitted by Section 6.04(e)),
unsecured Guarantees of the Senior Secured Notes to the extent required by the
Senior Secured Notes Documents, liabilities imposed by law, including tax
liabilities, and liabilities reasonably incurred in connection with its
maintenance of its existence, including payment of directors).

 

SECTION 6.04.  Investments, Loans, Advances, Guarantees
and Acquisitions.  No Loan Party
will, nor will it permit any of its subsidiaries to, purchase, hold or acquire
(including pursuant to any merger with any Person that was not a Loan Party and
a wholly-owned Subsidiary prior to such merger) any Equity Interests in or
evidences of Indebtedness or other securities (including any option, warrant or
other right to acquire any of the foregoing) of, make or permit to exist any
loans or advances to, Guarantee any obligations of, or make or permit to exist
any investment or any other interest in, any other Person, or purchase or
otherwise acquire (in one transaction or a series of transactions) any assets
of any other Person constituting a business unit (whether through purchase of
assets, merger or otherwise), except:

 

98

 

(a) cash and Permitted Investments;

 

(b) investments in existence on the
Effective Date and described in Schedule 6.04 and any extension,
modification or renewal of any such investments, but only to the extent not
involving additional advances, contributions or other investments of cash or
other assets or other increases thereof (other than as a result of the accrual
or accretion of interest or original issue discount or the issuance of
pay-in-kind securities, in each case, pursuant to the terms of such investment
as in effect on the date of hereof);

 

(c) investments by Holdings in the
Parent Borrower and by the Parent Borrower and the Subsidiaries in Equity
Interests in their respective subsidiaries, provided that (i) any
such Equity Interests held by a Loan Party shall be pledged pursuant to the
applicable Collateral Document (subject to the limitations applicable to Equity
Interests of a Foreign Subsidiary pledged to secure the U.S. Secured
Obligations referred to in Section 5.11 and to the extent permitted by
applicable law) and (ii) the aggregate amount of investments by Loan
Parties in Subsidiaries that are not Loan Parties (together with outstanding
intercompany loans permitted under clause (ii) to the proviso to Section 6.04(d) and
outstanding Guarantees permitted under the proviso to Section 6.04(e))
shall not exceed $7,500,000 at any time outstanding (in each case determined
without regard to any write-downs or write-offs);

 

(d) loans or advances made by the Parent
Borrower to any Subsidiary and made by any Subsidiary to the Parent Borrower or
any other Subsidiary, provided that (i) any such loans and advances
made by a Loan Party shall be evidenced by a promissory note pledged pursuant
to the applicable Collateral Document and (ii) the amount of such loans
and advances made by Loan Parties to Subsidiaries that are not Loan Parties
(together with outstanding investments permitted under clause (ii) to
the proviso to Section 6.04(c) and outstanding Guarantees permitted
under the proviso to Section 6.04(e)) shall not exceed $7,500,000 at any
time outstanding (in each case determined without regard to any write-downs or
write-offs);

 

(e) (i) Guarantees of Indebtedness
that are permitted by Section 6.01, provided that the
aggregate principal amount of Indebtedness of Subsidiaries that are not Loan
Parties that is Guaranteed by any Loan Party (together with outstanding
investments permitted under clause (ii) to the proviso to Section 6.04(c) and
outstanding intercompany loans permitted under clause (ii) to the
proviso to Section 6.04(d)) shall not exceed $7,500,000 at any time
outstanding (in each case determined without regard to any write-downs or
write-offs) and (ii) Guarantees of obligations (other than Indebtedness)
of any Loan Party in respect of sale and leaseback transactions permitted by Section 6.06;

 

(f) loans or advances made by a Loan
Party to its (i) directors, officers and employees in the ordinary course
of business for travel and entertainment expenses, relocation costs and similar
purposes up to a maximum of $1,000,000 in the aggregate at any one time
outstanding and (ii) directors, officers and employees to finance the
purchase of Equity Interests in a Loan Party up to a maximum of $1,000,000 in
the aggregate at any one time outstanding (in each case determined without
regard to any write-downs or write-offs);

 

(g) investments in the form of Swap
Agreements permitted by Section 6.07;

 

(h) investments of any Person existing
at the time such Person becomes a Subsidiary or consolidates, amalgamates or
merges with or into the Parent Borrower or any Subsidiary so long as such
investments were not made in contemplation of such Person becoming a Subsidiary
or of such consolidation, amalgamation or merger;

 

99

 

(i) investments received in connection
with the disposition of any asset permitted by Section 6.05;

 

(j) investments received (i) in
exchange for any other investment or account receivable in connection with or
as a result of a bankruptcy, workout, reorganization or recapitalization of the
issuer of such other investment or account receivable, (ii) as a result of
a foreclosure by the Parent Borrower or any Subsidiary with respect to any
secured investment or other transfer of title with respect to any secured
investment in default or (iii) in settlement or compromise of legal claims
and delinquent accounts receivable;

 

(k) investments constituting deposits
described in clause (c) or (d) of the definition of the term “Permitted
Encumbrances” or clause (o), (s) or (t) of Section 6.02;

 

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

 

(m) (i) investments in AAG either
directly or indirectly after the Effective Date in an aggregate amount not in
excess of $30,000,000 (plus an amount equal to any returns of capital or
sale proceeds actually received in cash in respect of such investment (which
amount shall not exceed the amount of such investment valued at cost at the
time such investment was made)) and (ii) investments in any other joint
venture or similar entity in an aggregate amount not in excess of $5,000,000 (plus
an amount equal to any returns of capital or sale proceeds actually received in
cash in respect of such investment (which amount shall not exceed the amount of
such investment valued at cost at the time such investment was made)); provided,
however, that after giving effect to any investment made pursuant to
this clause (m), Reference Availability shall be not less than $35,000,000;

 

(n) (i) the Acquisition and (ii) Permitted
Acquisitions, provided that, except to the extent that Permitted
Acquisitions are made with Excluded Proceeds, the aggregate purchase price of
all such Permitted Acquisitions, which shall be deemed to include, with respect
to any such Permitted Acquisition, (A) a good faith estimate by the
applicable Loan Party of the post-closing payment adjustments, earn-outs and
non-compete payments to be made in connection with such Permitted Acquisition
and (B) the principal amount of Indebtedness that is assumed pursuant to Section 6.01(i),
shall not exceed $175,000,000 in the aggregate since the Effective Date plus,
in each case (without duplication), an amount equal to any returns of capital
or sale proceeds actually received in cash in respect of any such Permitted
Acquisition (which amount shall not exceed the purchase price paid (including
the principal amount of Indebtedness assumed pursuant to Section 6.01(i) in
connection therewith and the amount estimated to be paid in respect of
post-closing payment adjustments, earn-outs and non-compete payments) in
respect of such Permitted Acquisition);

 

(o) other investments, loans and
advances by the Parent Borrower or any Subsidiary (including investments in any
minority-owned joint venture) in an aggregate amount, as valued at cost at the
time each such investment, loan or advance is made and including all related
commitments for future investments, loans or advances (and the principal amount
of any Indebtedness that is assumed or otherwise incurred in connection with
such investment, loan or advance), not exceeding $5,000,000 in the aggregate
for all such investments made or committed to be made from and after the
Effective Date plus an amount equal to any returns of capital or sale
proceeds actually received in cash in respect of any such investments (which
amount shall not exceed the amount of such investment valued at cost at the
time such investment was made);

 

(p) to the extent permitted by the
Senior Secured Notes Indenture, investments made with 

 

100

 

the AAG Proceeds, provided that such investments are made within
twelve months after the receipt by the Parent Borrower or any Subsidiary of
such AAG Proceeds; and

 

(q) other investments (other than any
acquisition of all the outstanding Equity Interests (other than directors’
qualifying shares) in, or substantially all the assets of, or all or
substantially all the assets constituting a division or line of business of, a
Person) made with Excluded Proceeds.

 

SECTION 6.05.  Asset Sales.  No Loan Party will, nor will it permit any of
its subsidiaries to, sell, transfer, lease or otherwise dispose of any asset,
including any Equity Interest owned by it, nor will the Parent Borrower permit
any Subsidiary to issue any additional Equity Interest in such Subsidiary
(other than to the Parent Borrower or another Subsidiary in compliance with Section 6.04(c)),
except:

 

(a) sales, transfers and dispositions of
(i) inventory, (ii) used, obsolete, worn out or surplus equipment or
property, (iii) any asset in a like-kind exchange and (iv) Permitted
Investments, in each case in the ordinary course of business;

 

(b) sales, transfers and dispositions to
the Parent Borrower or any Subsidiary, provided that any such sales,
transfers or dispositions involving a Subsidiary that is not a Loan Party shall
be made in compliance with Section 6.09;

 

(c) (i) sales, transfers and
dispositions of accounts receivable in connection with the compromise,
settlement or collection thereof consistent with past practice and (ii) the
settlement or compromise of any legal claims;

 

(d) sales, transfers and dispositions of
investments permitted by clauses (h), (i) or (j) of Section 6.04
or another asset received as consideration for the disposition of any asset
permitted by this Section 6.05 (in each case, other than Equity Interests
in a Subsidiary, unless all Equity Interests in such Subsidiary are sold);

 

(e) sale and leaseback transactions
permitted by Section 6.06;

 

(f) (i) leases or (ii) licenses,
in each case entered into the ordinary course of business, to the extent that
they do not materially interfere with the business of Holdings, the Parent
Borrower or any Subsidiary;

 

(g) licenses or sublicenses of
intellectual property in the ordinary course of business, to the extent that
they do not materially interfere with the business of Holdings, the Parent
Borrower or any Subsidiary;

 

(h) dispositions resulting from any
casualty or other insured damage to, or any taking under power of eminent
domain or by condemnation or similar proceeding of, any property or asset of
the Parent Borrower or any Subsidiary;

 

(i) any AAG Dispositions;

 

(j) the abandonment or other disposition
of intellectual property that is, in the reasonable good faith judgment of
Holdings or the Parent Borrower, no longer economically practicable or
commercially desirable to maintain or useful in the conduct of the business of
the Parent Borrower and the Subsidiaries;

 

101

 

(k) the disposition of any investments
existing on the Effective Date and set forth on Schedule 6.04;

 

(l) dispositions of non-core assets
acquired in connection with the Acquisition or any Permitted Acquisition;

 

(m) the sale of the Fostoria Plant;

 

(n) the provision of samples and
displays to consumers or prospective customers; and

 

(o) sales, transfers and other
dispositions of assets (other than Equity Interests in a Subsidiary unless all
Equity Interests in such Subsidiary (other than the Canadian Subsidiary
Borrower) are sold) that are not permitted by any other clause of this Section 6.05,
provided that the aggregate fair market value of all assets sold,
transferred or otherwise disposed of in reliance upon this paragraph (o) shall
not exceed $7,500,000 during any fiscal year of the Parent Borrower,

 

provided that all
sales, transfers, leases and other dispositions permitted hereby (other than
those permitted by clauses (a)(ii), (b), (c), (d) (solely with respect to
dispositions of investments permitted by clause (i) or (j) of Section 6.04),
(f)(ii), (g), (h), (j) and (n) above) shall be made for fair value
and (other than those permitted by clauses (a)(ii), (a)(iii), (b) (unless
the disposition is by a Loan Party to a Subsidiary that is not a Loan Party),
(c), (d), (f)(ii), (g), (h), (i), (j) or (n) above) for at least 75%
cash consideration payable at the time of such sale, transfer or other
disposition; provided  further that any consideration in the form
of (i) Permitted Investments or cash equivalents, in each case that are
disposed of for cash consideration within 30 Business Days after such sale,
transfer or other disposition or (ii) accounts receivable that are payable
in cash, have payment terms customary to the Borrowers and are received in the
ordinary course of business shall be deemed to be cash consideration in an
amount equal to the amount of such cash consideration for purposes of this
proviso.

 

SECTION 6.06.  Sale and Leaseback Transactions.  No Loan Party will, nor will it permit any of
its subsidiaries to, enter into any arrangement, directly or indirectly,
whereby it shall sell or transfer any property, real or personal, used or
useful in its business, whether now owned or hereafter acquired, and thereafter
rent or lease such property or other property that it intends to use for
substantially the same purpose or purposes as the property sold or transferred,
except for (a) any such sale of any fixed or capital assets by the Parent
Borrower or any Subsidiary that is made for cash consideration in an amount not
less than the fair value of such fixed or capital asset and is consummated
within 180 days after the Parent Borrower or such Subsidiary acquires or
completes the construction of such fixed or capital asset and (b) any such
sale of real property by the Parent Borrower or any Subsidiary that is made for
cash consideration in an amount (which amount shall exclude customary fees,
costs and expenses incurred by the Parent Borrower or such Subsidiary, as the
case may be, in connection with such sales as well as the aggregate amount of
customary security deposits associated therewith (collectively, the “Excluded
Amounts”)) not less than the fair value of the applicable real property, provided
that (i) in the case of clause (b), (x) the aggregate fair value of
all real property sold in accordance with clause (b) shall not exceed
$20,000,000 (which amount shall exclude the Excluded Amounts) and (y) the
Parent Borrower shall, on or prior to the date of each such sale, deliver to
the Administrative Agent a certificate of a Responsible Officer of the Parent
Borrower certifying that such sale complies with the requirements of clause
(b), and (ii) in the case of each of clause (a) and (b), if such
sale and leaseback results in Indebtedness, such Indebtedness is permitted by Section 6.01(d),
Section 6.01(e) or Section 6.01(j) and any Liens made the
subject of such Indebtedness is permitted by Section 6.02(b) or Section 6.02(g).

 

SECTION 6.07.  Swap Agreements.  No Loan Party will, nor will it permit any of
its 

 

102

 

subsidiaries to, enter into
any Swap Agreement, except (a) Swap Agreements entered into to hedge or
mitigate risks to which the Parent Borrower or any Subsidiary are subject or
the management of the liabilities of the Parent Borrower or any Subsidiary and
not for speculative purposes (other than those in respect of Equity Interests
of the Parent Borrower or any Subsidiary), and (b) Swap Agreements entered
into in order to effectively cap, collar or exchange interest rates (from fixed
to floating rates, from one floating rate to another floating rate or
otherwise) with respect to any interest-bearing liability or investment of the
Parent Borrower or any Subsidiary.

 

SECTION 6.08.  Restricted Payments; Certain Payments of
Indebtedness.  (a)  No Loan
Party will, nor will it permit any of its subsidiaries to, declare or make, or
agree to pay or make, directly or indirectly, any Restricted Payment, or incur
any obligation (contingent or otherwise) to do so, except (i) the
Subsidiaries may declare and pay dividends ratably with respect to their Equity
Interests, (ii) Holdings may declare and pay dividends with respect to its
Equity Interests payable solely in shares of Qualified Equity Interests, (iii) Holdings
may make (and the Parent Borrower may declare and make dividends or other
distributions to Holdings in amounts necessary to permit Holdings to make)
Restricted Payments in an aggregate amount not to exceed $3,000,000 in any
fiscal year of the Parent Borrower to cancel, redeem, acquire or repurchase
shares of its common or preferred stock held by, or stock options granted to,
directors and employees of the Loan Parties in the event of death, disability,
termination of employment or retirement of any such director or employee (it
being understood that such Restricted Payment may be in the form of
Indebtedness subordinated to the Obligations in a manner reasonably acceptable
to the Administrative Agent), (iv) Holdings may exchange its Qualified
Equity Interests for, and in repayment or prepayment of, any subordinated
Indebtedness permitted by Section 6.01(q) or refinance such
subordinated Indebtedness with other subordinated Indebtedness to the extent
permitted by Section 6.01(q), (v) Holdings may and the Parent
Borrower may, or may make Restricted Payments to Holdings so that Holdings may,
make Restricted Payments, not exceeding $1,000,000 during any fiscal year,
pursuant to and in accordance with stock option plans or other benefit plans
approved by the Parent Borrower’s board of directors for management or
employees of Holdings, the Parent Borrower and the Subsidiaries, (vi) the
Parent Borrower may make Restricted Payments to Holdings at such times and in
such amounts (A) not exceeding $500,000 during any fiscal year (or
$4,000,000 in any fiscal year of the Parent Borrower following the completion
of an IPO where Holdings is the Public Company), as shall be necessary to
permit Holdings to discharge its general corporate and overhead (including
franchise taxes and directors fees) expenses incurred in the ordinary course
and other permitted liabilities and (B) as shall be necessary to pay the
Tax liabilities of Holdings directly attributable to (or arising as a result
of) the operations of the Parent Borrower and the Subsidiaries; provided,
however, that (1) the amount of Restricted Payments pursuant to
clause (B) of this clause (vi) shall not exceed the amount
that the Parent Borrower and the Subsidiaries would be required to pay in
respect of federal, state, provincial and local taxes were the Parent Borrower
and the Subsidiaries to pay such taxes as stand-alone taxpayers and (2) all
Restricted Payments made to Holdings pursuant to this clause (vi) are used
by Holdings for the purposes specified herein within five Business Days after
Holdings’ receipt thereof, (vii) the Parent Borrower may make Restricted
Payments to the extent necessary to permit Holdings to make, and Holdings may
make, payments of or on account of (A) management, consulting and advisory
fees, (B) transaction fees and (C) reimbursement of reasonable
out-of-pocket costs and expenses incurred in connection with management,
consulting and advisory services, in each case to the Sponsor and the Sponsor
Affiliates to the extent permitted by Section 6.09(f), provided
that, solely with respect to Restricted Payments made pursuant to subclause (A) of
this clause (vii), no Event of Default shall have occurred and be continuing or
would result therefrom, (viii) concurrently with any issuance of Qualified
Equity Interests, Holdings may redeem, purchase or retire any Equity Interests
of Holdings using the proceeds of, or convert or exchange any Equity Interests
of Holdings for, such Qualified Equity Interests, (ix) to the extent
permitted by the Senior Secured Notes Indenture, the Loan Parties may make
Restricted Payments from (and within one year of the receipt of) AAG Proceeds, (x) the
Loan Parties may make Restricted Payments comprised of no more than 25% of the
Purchase Price Adjustment Proceeds, if any, 

 

103

 

(xi) Holdings may make
repurchases of Equity Interests of Holdings deemed to occur upon exercise of
stock options or warrants if such Equity Interests represent a portion of the
exercise price of such options or warrants pursuant to and in accordance with
stock option plans or other benefit plans approved by the Holdings’s or the
Parent Borrower’s board of directors for management or employees of Holdings,
the Parent Borrower and the Subsidiaries, (xii) Holdings may and the Parent
Borrower may, or may make Restricted Payments to Holdings so that Holdings may,
make cash payments in lieu of the issuance of fractional shares in connection
with the exercise of warrants, options or other securities convertible into or
exchangeable for Equity Interests of Holdings or the Parent Borrower, as the
case may be, and (xiii) the Parent Borrower may make to Holdings, and Holdings
may make, Restricted Payments using Excluded Proceeds.

 

(b)  No Loan Party will, nor will it
permit any of its subsidiaries to, make or agree to pay or make, directly or
indirectly, any payment or other distribution (whether in cash, securities or
other property) of or in respect of principal of or interest on any
Indebtedness, or any payment or other distribution (whether in cash, securities
or other property), including any sinking fund or similar deposit, on account
of the purchase, redemption, retirement, acquisition, cancellation or
termination of any Indebtedness, or any other payment (including any payment
under any Swap Agreement) that has a substantially similar effect to any of the
foregoing, except:

 

(i) payment of Indebtedness created
under the Loan Documents;

 

(ii) payment of regularly scheduled
interest and principal payments (and fees and expenses payable) as, in the form
of payment and when due in respect of any Indebtedness, other than payments in
respect of any Indebtedness subordinated to the Secured Obligations to the
extent prohibited by the subordination provisions thereof;

 

(iii) refinancings of Indebtedness to
the extent permitted by Section 6.01 and payments described in clause (a)(iv) of
this Section 6.08;

 

(iv) payment of secured Indebtedness
that becomes due as a result of the voluntary sale or transfer of the property
or assets securing such Indebtedness;

 

(v) payments and prepayments of
Indebtedness made with Excluded Proceeds;

 

(vi) to the extent permitted under the
Senior Secured Notes Indenture, (A) the purchase of Senior Secured Notes
from the AAG Proceeds, (B) the purchase of Senior Secured Notes in an
aggregate amount not to exceed $25,000,000 since the Effective Date if, in the
case of this clause (B), the Reference Availability immediately after giving
effect to any such purchase shall not be less than $75,000,000, and (C) the
purchase of Senior Secured Notes pursuant to an Excess Cash Flow Offer (as
defined in the Senior Secured Notes Indenture), provided that, in the
case of clause (C), immediately before and after giving effect to such purchase
of Senior Secured Notes, the amount equal to (x) the lesser of (1) the
Revolving Commitments at such time and (2) the Total Borrowing Base at
such time shall exceed (y) the Revolving Exposure at such time by at least
$75,000,000;

 

(vii) payment of obligations under Swap
Agreements permitted by Section 6.07 in respect of (A) any mandatory
or involuntary termination thereof and (B) any voluntary termination
thereof in the ordinary course of business;

 

(viii) payment of Indebtedness permitted
by Section 6.01 to the extent necessary to 

 

104

 

avoid any Default created by currency fluctuations caused by
application of Section 1.05; and

 

(ix) payments and prepayments of
Indebtedness permitted by Section 6.01(c), (d), (e), (g), (i), (j), (k),
(l), (m), (o) or (r), provided that, immediately after giving
effect to any such payment or prepayment, Reference Availability shall not be
less than $35,000,000.

 

SECTION 6.09.  Transactions with Affiliates.  No Loan Party will, nor will it permit any of
its subsidiaries to, sell, lease or otherwise transfer any property or assets
to, or purchase, lease or otherwise acquire any property or assets from, or
otherwise engage in any other transactions with, any of its Affiliates, except (a) transactions
that (i) are in the ordinary course of business and (ii) are at
prices and on terms and conditions not less favorable to the Parent Borrower or
such Subsidiary than could be obtained on an arm’s-length basis from unrelated
third parties, (b) transactions between or among the Parent Borrower and
any Subsidiary Loan Party not involving any other Affiliate, (c) transactions
between or among the Parent Borrower and any Affiliate that is not a Loan Party
so long as such transactions (other than transactions permitted pursuant to Section 6.05(b))
are expressly permitted hereby, (d) the payment of reasonable fees to
directors of Holdings, the Parent Borrower or any Subsidiary who are not employees
of Holdings, the Parent Borrower or any Subsidiary, and compensation and
employee benefit arrangements paid to, and indemnities provided for the benefit
of, and employment severance arrangements entered into with, directors,
officers or employees of Holdings, the Parent Borrower or the Subsidiaries in
the ordinary course of business, (e) any issuances of securities or other
payments, awards or grants in cash, securities or otherwise pursuant to, or the
funding of, employment agreements, stock options and stock ownership plans
approved by the Parent Borrower’s board of directors, (f) (A) so long
as no Event of Default has occurred and is continuing, the payment of
management, consulting and advisory fees to the Sponsor or any Sponsor
Affiliate in an amount not to exceed, in any fiscal year, the greater of (i) $1,000,000
and (ii) 2.00% of EBITDA (as such term is defined in the Management
Services Agreement) for the immediately preceding fiscal year, (B) the
payment of transaction fees in respect of the Original Transaction to the
Sponsor or any Sponsor Affiliate on the Effective Date in an amount not to
exceed $4,650,000 and otherwise as set forth in the Management Services
Agreement, a copy of which has been delivered to the Administrative Agent prior
to the Effective Date, and (C) the reimbursement of reasonable
out-of-pocket costs and expenses of the Sponsor or any Sponsor Affiliate
incurred in connection with management, consulting and advisory services, provided
that, to the extent that any of the fees and expenses referenced in this clause
(f) are not permitted to be paid at any time as a result of a failure to
meet the conditions set forth in this clause (f), such fees and expenses may be
accrued and paid at such time when such conditions are, and continue to be,
satisfied, (g) any contribution to the capital of Holdings by the
Permitted Holders or any purchase of Equity Interests of Holdings by the
Permitted Holders, (h) any Restricted Payment permitted under Section 6.08
and (i) any transactions described on Schedule 6.09.  It is hereby understood and agreed that the
incurrence of any Term Loans hereunder shall not violate this Section 6.09.

 

SECTION 6.10.  Restrictive Agreements.  No Loan Party will, nor will it permit any of
its subsidiaries to, directly or indirectly, enter into, incur or permit to
exist any agreement or other arrangement that prohibits, restricts or imposes
any condition upon (a) the ability of such Loan Party or any of its
subsidiaries to create, incur or permit to exist any Lien upon any of its
property or assets, or (b) the ability of any Subsidiary to pay dividends
or other distributions with respect to any shares of its Equity Interests or to
make or repay loans or advances to the Parent Borrower or any other Subsidiary
or to Guarantee Indebtedness of the Parent Borrower or any other Subsidiary, provided
that (i) the foregoing shall not apply to restrictions and conditions
imposed by law, by any Loan Document or by any Senior Secured Notes Document, (ii) the
foregoing shall not apply to restrictions and conditions existing on the
Effective Date identified on Schedule 6.10 (but shall apply to any
extension or renewal of, or any amendment or modification expanding the scope
of, any such restriction or condition), (iii) the foregoing

 

105

 

shall not
apply to customary restrictions and conditions contained in agreements relating
to the sale of a Subsidiary or any assets pending such sale, provided
that such restrictions and conditions apply only to the Subsidiary or the
assets that is or are to be sold and such sale is permitted hereunder, (iv) clause
(a) of the foregoing shall not apply to restrictions or conditions imposed
by any agreement relating to secured Indebtedness permitted by this Agreement
if such restrictions or conditions apply only to the property or assets
securing such Indebtedness, (v) clause (a) of the foregoing shall not
apply to customary provisions in leases, intellectual property licenses and
other contracts restricting the assignment thereof, (vi) clause (a) of
the foregoing shall not apply to restrictions or conditions imposed by any
agreement relating to any Indebtedness of a Subsidiary permitted by Section 6.01(i),
(vii) clauses (a) and (b) of the foregoing shall not apply to
any subordinated Indebtedness of Holdings or the Parent Borrower permitted
hereby and (viii) clauses (a) and (b) of the foregoing shall not
apply to restrictions on net worth or cash or other deposits imposed by
customers, suppliers or landlords under contracts entered into by the Parent
Borrower or any Subsidiary in its ordinary course of business.

 

SECTION 6.11.  Amendment of Material Documents.  No Loan Party will, nor will it permit any of
its subsidiaries to, amend, modify, waive or release any of its rights under (a) any
agreement relating to any Indebtedness permitted under Section 6.01(b), (b) its
certificate of incorporation, by-laws, operating, management or partnership
agreement or other organizational documents, (c) any Acquisition Document,
(d) any Senior Secured Notes Documents, (e) the Management Services
Agreement or (f) any agreement in respect of any joint venture to which
such Loan Party or subsidiary, as applicable, is a party, in each case, to the
extent any such amendment, modification or waiver could reasonably be expected
to be materially adverse to the Lenders.

 

SECTION 6.12.  Fixed Charge Coverage Ratio.  If, at any time, (x) Average
Availability or (y) Availability for the preceding period of four
consecutive Business Days, in either case is less than $25,000,000, then the Borrowers
will not permit the Fixed Charge Coverage Ratio at such time, determined for
the period of four consecutive fiscal quarters most recently ended at or prior
to such time, to be less than 1.10 to 1.00.

 

SECTION 6.13.  Certain Equity Securities.  No Loan Party will, nor will it permit any of
its subsidiaries to, issue any preferred Equity Interests or any Disqualified
Equity Interests, except, in the case of Holdings, preferred Equity Interests
that are Qualified Equity Interests.

 

SECTION 6.14.  Changes in Fiscal Periods.  The Parent Borrower will neither (a) permit
its fiscal year or the fiscal year of any Subsidiary to end on a day other than
December 31, nor (b) change its method of determining fiscal
quarters.

 

ARTICLE VII

 

Events of Default

 

If any of the
following events (“Events of Default”) shall occur:

 

(a) either Borrower shall
fail to pay any principal of any Loan or the face amount of any B/A or any
reimbursement obligation in respect of any L/C Disbursement when and as the
same shall become due and payable, whether at the due date thereof or at a date
fixed for prepayment thereof or otherwise;

 

(b) either Borrower shall
fail to pay any interest on any Loan or any fee or any other amount (other than
an amount referred to in clause (a) of this Article) payable under this
Agreement, when and as the same shall become due and payable, and such failure
shall continue

 

106

 

unremedied for a period of five Business
Days;

 

(c) any representation or
warranty made or deemed made by or on behalf of any Loan Party or any of its
subsidiaries in or in connection with this Agreement or any Loan Document or
any amendment or modification thereof or waiver thereunder, or in any report,
certificate, financial statement or other document furnished pursuant to or in
connection with this Agreement or any Loan Document or any amendment or
modification thereof or waiver thereunder, shall prove to have been incorrect
in any material respect when made or deemed made;

 

(d) any Loan Party shall
fail to observe or perform any covenant, condition or agreement contained in Section 5.02,
5.03 (with respect to a Loan Party’s existence) or 5.08 or in Article VI;

 

(e) any Loan Party shall
fail to observe or perform any covenant, condition or agreement contained in
this Agreement (other than those specified in clause (a), (b) or (d) of
this Article), and such failure shall continue unremedied for a period of (i) 10 days
after notice thereof from the Administrative Agent (which notice will be given
at the request of any Lender) if such breach relates to terms or provisions of Section 5.01,
5.03 through 5.07, 5.09, 5.10 or 5.12 of this Agreement or (ii) 30 days
after notice thereof from the Administrative Agent (which notice will be given
at the request of any Lender) if such breach relates to terms or provisions of
any other Section of this Agreement;

 

(f) any Loan Party or any
of its subsidiaries shall fail to make any payment (whether of principal
or interest and regardless of amount) in respect of any Material Indebtedness,
when and as the same shall become due and payable;

 

(g) any event or condition
occurs that results in any Material Indebtedness becoming due prior to its
scheduled maturity or that enables or permits (with all applicable grace
periods having expired) the holder or holders of any Material Indebtedness or
any trustee or agent on its or their behalf to cause any Material Indebtedness
to become due, or to require the prepayment, repurchase, redemption or
defeasance thereof, prior to its scheduled maturity, provided that this
clause (g) shall not apply to secured Indebtedness that becomes due
as a result of the sale, transfer or other disposition (including as a result
of a casualty or condemnation event) of the property or assets securing such
Indebtedness (to the extent such sale, transfer or other disposition is not
prohibited under this Agreement);

 

(h) an involuntary case,
action or proceeding shall be commenced or an involuntary petition shall be
filed seeking (i) liquidation, reorganization or other relief in respect
of any Loan Party or any of its subsidiaries or its debts, or of a substantial
part of its assets, under any federal, state, provincial or foreign bankruptcy,
insolvency, receivership or similar law now or hereafter in effect or (ii) the
appointment of a receiver, interim receiver, receiver manager, trustee,
custodian, sequestrator, conservator or similar official for any Loan Party or
any of its subsidiaries or for a substantial part of its assets, and, in any
such case, such case, action, proceeding or petition shall continue undismissed
for 60 days or an order or decree approving or ordering any of the
foregoing shall be entered;

 

(i) any Loan Party or any
of its subsidiaries shall (i) voluntarily commence any case, action or
proceeding or file any petition seeking liquidation, reorganization or other
relief under any federal, state, provincial or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect, (ii) consent to the
institution of, or fail to contest in a timely and appropriate manner, any
case, action, proceeding or petition described in clause (h) of this
Article, (iii) apply for or consent to the appointment of a receiver,
interim receiver, receiver manager, trustee,

 

107

 

custodian, sequestrator, conservator or
similar official for such Loan Party or any of its subsidiaries or for a
substantial part of its assets, (iv) file an answer admitting the material
allegations of a petition filed against it in any such case, action or
proceeding, (v) make a general assignment for the benefit of creditors or (vi) take
any action for the purpose of effecting any of the foregoing;

 

(j) any Loan Party or any
of its subsidiaries shall become unable, admit in writing its inability or fail
generally to pay its debts as they become due;

 

(k) one or more judgments
for the payment of money in an aggregate amount in excess of $7,500,000
(excluding amounts covered by funded indemnities or insurance as to which the
applicable insurance company is solvent and has acknowledged liability in
respect thereof) shall be rendered against any Loan Party, any of its
subsidiaries or any combination thereof, and the same shall remain undischarged
for a period of 45 consecutive days during which execution shall not be
effectively stayed, or any action shall be legally taken by a judgment creditor
to attach or levy upon any assets of any Loan Party or any of its subsidiaries
(to the extent such assets attached or levied upon have an aggregate fair
market value in excess of $100,000) to enforce any such judgment or any Loan
Party or any of its subsidiaries shall fail within 45 days to discharge one or
more non-monetary judgments or orders which, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect, which judgments
or orders, in any such case, are not stayed on appeal or otherwise being
appropriately contested in good faith by proper proceedings diligently pursued;

 

(l) an ERISA Event shall
have occurred that, in the opinion of the Required Lenders, when taken together
with all other ERISA Events that have occurred, could reasonably be expected to
result in a Material Adverse Effect;

 

(m) a Change in Control
shall occur;

 

(n) the occurrence of any “default”,
as defined in any Loan Document (other than this Agreement) or the breach of
any of the terms or provisions of any Loan Document (other than this
Agreement), which default or breach continues beyond any period of grace
therein provided, and if no grace period is provided, such period shall be
30 days after notice to the Parent Borrower;

 

(o) the Loan Guaranty
shall fail to remain in full force or effect (except as permitted by the Loan
Documents) or any action shall be taken to discontinue or to assert the
invalidity or unenforceability of the Loan Guaranty, or any Loan Guarantor
shall fail to comply with any of the terms or provisions of the Loan Guaranty
to which it is a party, or any Loan Guarantor shall deny that it has any
further liability under the Loan Guaranty to which it is a party, or shall give
notice to such effect;

 

(p) any Collateral
Document shall for any reason fail to create a valid and perfected first
priority security interest in any Collateral purported to be covered thereby,
except as permitted by the terms of any Collateral Document, or any Collateral
Document shall fail to remain in full force or effect or any action shall be
taken to discontinue or to assert the invalidity or unenforceability of any
Collateral Document, or any Loan Party shall fail to comply with any of the
terms or provisions of any Collateral Document; or

 

(q) any material provision
of any Loan Document for any reason ceases to be valid, binding and enforceable
in accordance with its terms (or any Loan Party shall challenge the

 

108

 

enforceability of any Loan Document or shall
assert in writing, or engage in any action or inaction based on any such
assertion, that any provision of any of the Loan Documents has ceased to be or
otherwise is not valid, binding and enforceable in accordance with its terms);

 

then, and in every such event
(other than an event with respect to Holdings or either Borrower described in
clause (h) or (i) of this Article), and at any time thereafter during
the continuance of such event, the Administrative Agent may, and at the request
of the Required Lenders shall, by notice to the Parent Borrower, take either or
both of the following actions, at the same or different times:  (i) terminate
the Commitments, and thereupon the Commitments shall terminate immediately, and
(ii) declare the Loans and the B/A Drawings then outstanding to be due and
payable in whole (or in part, in which case any principal not so declared to be
due and payable may thereafter be declared to be due and payable), and
thereupon the principal of the Loans, and the full face amount of all
outstanding B/As, so declared to be due and payable, together with accrued
interest thereon and all fees and other obligations of each Borrower accrued
hereunder, shall become due and payable immediately, without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
each Borrower; and in case of any event with respect to Holdings or either
Borrower described in clause (h) or (i) of this Article, the
Commitments shall automatically terminate and the principal of the Loans and
the full face amount of B/As, in each case then outstanding, together with
accrued interest thereon and all fees and other obligations of each Borrower
accrued hereunder, shall automatically become due and payable, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower.  Upon the
occurrence and the continuance of an Event of Default, the Administrative Agent
may, and at the request of the Required Lenders shall, exercise any rights and
remedies provided to the Administrative Agent under the Loan Documents or at
law or equity, including all remedies provided under the UCC and other
applicable personal property security laws in the relevant jurisdictions (it
being understood and agreed that, except as expressly provided herein
(including pursuant to Section 9.08) or in any other Loan Document, only
the Administrative Agent, acting on behalf of the Secured Parties, may exercise
such rights and remedies in respect of the Collateral).

 

Solely for
purposes of determining whether a Default has occurred under paragraph (h),
(i), (j) or (k) of Article VII, any reference in any such
paragraph to any Subsidiary shall be deemed not to include any Subsidiary
affected by any event or circumstance referred to in such paragraph that did
not, as of the last day of the fiscal quarter of the Parent Borrower most-recently
ended, have assets with a value equal to or greater than 3.75% of consolidated
total assets of the Parent Borrower and its consolidated subsidiaries as of
such date, based on the consolidated balance sheet of the Parent Borrower and
its consolidated subsidiaries as of such date, provided that if it is
necessary to exclude more than one Subsidiary from paragraph (h), (i), (j) or
(k) of Article VII pursuant to this paragraph in order to avoid a
Default, the aggregate value of the assets of all such excluded Subsidiaries as
of such last day may not exceed 7.50% of consolidated total assets of the
Parent Borrower and its consolidated subsidiaries as of such date, based on the
consolidated balance sheet of the Parent Borrower and its consolidated subsidiaries
as of such date.

 

ARTICLE VIII

 

The Administrative Agent

 

Each of the
Lenders and the Issuing Bank hereby irrevocably appoints the Administrative
Agent as its agent and authorizes the Administrative Agent to take such actions
on its behalf, including execution of the other Loan Documents, and to exercise
such powers as are delegated to the Administrative Agent by the terms of the
Loan Documents, together with such actions and powers as are reasonably
incidental thereto.  The provisions of
this Article are solely for the benefit of the Administrative Agent, the
Lenders and the Issuing Bank, and no Loan Party shall have rights as a third

 

109

 

party beneficiary of any of such provisions.

 

The bank
serving as the Administrative Agent hereunder shall have the same rights and
powers in its capacity as a Lender as any other Lender and may exercise the
same as though it were not the Administrative Agent, and such bank and its
Affiliates may accept deposits from, lend money to and generally engage in any
kind of business with the Loan Parties or any Subsidiary of a Loan Party or
other Affiliate thereof as if it were not the Administrative Agent hereunder.

 

The
Administrative Agent shall not have any duties or obligations except those
expressly set forth in the Loan Documents. 
Without limiting the generality of the foregoing, (a) the
Administrative Agent shall not be subject to any fiduciary or other implied
duties, regardless of whether a Default has occurred and is continuing, (b) the
Administrative Agent shall not have any duty to take any discretionary action
or exercise any discretionary powers, except discretionary rights and powers
expressly contemplated by the Loan Documents that the Administrative Agent is
required to exercise in writing as directed by the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary or believed by
the Administrative Agent in good faith to be necessary under the circumstances
as provided in Section 2.05(j), Section 9.02 or Section 9.04(e)),
and (c) except as expressly set forth in the Loan Documents, the
Administrative Agent shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to any Loan Party
or any of its subsidiaries that is communicated to or obtained by the bank
serving as Administrative Agent or any of its Affiliates in any capacity.  The Administrative Agent shall not be liable
for any action taken or not taken by it with the consent or at the request of
the Required Lenders (or such other number or percentage of the Lenders as
shall be necessary or believed by the Administrative Agent in good faith to be
necessary under the circumstances as provided in Section 2.05(j), Section 9.02
or Section 9.04(e)) or in the absence of its own gross negligence or
wilful misconduct.  The Administrative
Agent shall be deemed not to have knowledge of any Default unless and until
written notice thereof is given to the Administrative Agent by the Parent
Borrower or a Lender, and the Administrative Agent shall not be responsible for
or have any duty to ascertain or inquire into (i) any statement, warranty
or representation made in or in connection with any Loan Document, (ii) the
contents of any certificate, report or other document delivered under or in
connection with any Loan Document, (iii) the performance or observance of
any of the covenants, agreements or other terms or conditions set forth in any
Loan Document or the occurrence of any Default, (iv) the validity,
enforceability, effectiveness or genuineness of any Loan Document or any other
agreement, instrument or document, (v) the creation, perfection or
priority of Liens on the Collateral or the existence of the Collateral, or (vi) the
satisfaction of any condition set forth in Article IV or elsewhere in any
Loan Document, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent.

 

The
Administrative Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing (including any electronic
message, Internet or intranet website posting or other distribution)  believed by it to be genuine and to have been
signed or sent or otherwise authenticated by the proper Person.  The Administrative Agent also may rely upon
any statement made to it orally or by telephone and believed by it to be made
by the proper Person, and shall not incur any liability for relying
thereon.  The Administrative Agent may
consult with legal counsel (who may be counsel for either Borrower),
independent accountants and other experts selected by it, and shall not be
liable for any action taken or not taken by it in accordance with the advice of
any such counsel, accountants or experts.

 

The
Administrative Agent may perform any and all its duties and exercise its rights
and powers by or through any one or more sub-agents appointed by the
Administrative Agent.  The Administrative
Agent and any such sub-agent may perform any and all its duties and exercise
its rights and powers through their respective Related Parties.  The exculpatory provisions of the preceding

 

110

 

paragraphs shall apply to any such sub-agent and to the Related Parties
of the Administrative Agent and any such sub-agent, and shall apply to their
respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.

 

Subject to the
appointment and acceptance of a successor Administrative Agent as provided in
this paragraph, the Administrative Agent may resign at any time by notifying
the Lenders, the Issuing Bank and the Borrowers.  Upon any such resignation, the Required
Lenders shall have the right, in consultation with the Borrowers, to appoint a
successor.  If no successor shall have
been so appointed by the Required Lenders and shall have accepted such
appointment within 30 days after the retiring Administrative Agent gives
notice of its resignation, then the retiring Administrative Agent may, on
behalf of the Lenders and the Issuing Bank, appoint a successor Administrative
Agent which shall be a bank with an office in New York, New York or an
Affiliate of any such bank.  Upon the
acceptance of its appointment as Administrative Agent hereunder by a successor,
such successor shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations under
the Loan Documents.  The fees payable by
the Borrowers to a successor Administrative Agent shall be the same as those
payable to its predecessor unless otherwise agreed between the Borrowers and
such successor.  After the Administrative
Agent’s resignation hereunder, the provisions of this Article and Section 9.03
shall continue in effect for the benefit of such retiring Administrative Agent,
its sub-agents and their respective Related Parties in respect of any actions
taken or omitted to be taken by any of them while the retiring Administrative
Agent was acting as Administrative Agent.

 

Each Lender
and the Issuing Bank acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Lender or any of their
Related Parties and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement.  Each Lender and the Issuing
Bank also acknowledges that it will, independently and without reliance upon
the Administrative Agent or any other Lender or any of their Related Parties
and based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any other Loan Document or related
agreement or any document furnished hereunder or thereunder.

 

Each Lender
hereby agrees that (a) it has requested a copy of each Report prepared by
or on behalf of the Administrative Agent, (b) the Administrative Agent (i) makes
no representation or warranty, express or implied, as to the completeness or
accuracy of any Report or any of the information contained therein or any
inaccuracy or omission contained in or relating to a Report and (ii) shall
not be liable for any information contained in any Report, (c) the Reports
are not comprehensive audits or examinations, and that any Person performing
any field examination will inspect only specific information regarding the Loan
Parties and will rely significantly upon the Loan Parties’ books and records,
as well as on representations of the Loan Parties’ personnel and that the
Administrative Agent undertakes no obligation to update, correct or supplement
the Reports, (d) it will keep all Reports confidential and strictly for
its internal use, not share the Report with any Loan Party or any other Person
except as otherwise permitted pursuant to this Agreement, and (e) without
limiting the generality of any other indemnification provision contained in
this Agreement, it will pay and protect, and indemnify, defend, and hold
the Administrative Agent and any such other Person preparing a Report harmless
from and against, the claims, actions, proceedings, damages, costs, expenses,
and other amounts (including reasonable attorney fees) incurred by as the
direct or indirect result of any third parties who might obtain all or part of
any Report through the indemnifying Lender.

 

Notwithstanding
anything herein to the contrary, none of the Bookrunners or Arrangers listed on
the cover page hereof shall have any powers, duties or responsibilities
under any Loan

 

111

 

Document, except in its capacity, as
applicable, as the Administrative Agent, a Lender or the Issuing Bank
hereunder.

 

ARTICLE IX

 

Miscellaneous

 

SECTION 9.01.  Notices.  (a)  Except in the case of notices and
other communications expressly permitted to be given by telephone (and subject
to paragraph (b) below), all notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by facsimile, as
follows:

 

(i) if to any Loan Party,
to the Parent Borrower at:

 

Indalex
Holding Corp.

75 Tri-State International, Suite 450

Lincolnshire, IL 60069

Attention:  Patrick Lawlor

Facsimile
No:  (847) 295-3851

 

with a copy to:

 

Sun Capital
Partners, Inc.

5200 Town Center Circle, Suite 420

Boca Raton, FL  33486

Attention:  C. Deryl Couch, Esq.

Facsimile
No.:  (561) 394-0550

 

and

 

Sun Capital
Partners, Inc.

11111 Santa
Monica Boulevard

Los Angeles,
CA 90025

Attention:  Matthew Garff

Facsimile
No.:  (310) 473-1119

 

and

 

Kirkland &
Ellis LLP

200 E.
Randolph Drive

Chicago,
IL  60601

Attention:
Douglas C. Gessner P.C. and Michael D. Wright P.C.

Facsimile No.:
(312) 861-2200

 

112

 

(ii) if
to the Administrative Agent, the Issuing Bank or the Swingline Lender, to
JPMorgan Chase Bank, N.A. at:

 

Loan and
Agency Services Group

1111 Fannin
Street, 10th Floor

Houston, TX
77002

Attention:  Cynthia Freeman

Facsimile
No:  (713) 750-2223

 

(iii) if
to any other Lender, to it at its address or facsimile number set forth in its
Administrative Questionnaire.

 

All such notices and other
communications (i) sent by hand or overnight courier service, or mailed by
certified or registered mail, shall be deemed to have been given when received
or (ii) sent by facsimile shall be deemed to have been given when sent, provided
that if not given during normal business hours for the recipient, shall be
deemed to have been given at the opening of business on the next Business Day
for the recipient.

 

(b) 
Notices and other communications to the Lenders and the Issuing Bank hereunder
may be delivered or furnished by electronic communications (including e-mail
and internet or intranet websites) pursuant to procedures approved by the
Administrative Agent, provided that the foregoing shall not apply to
notices pursuant to Article II or to compliance and no Event of Default
certificates delivered pursuant to Section 5.01(d) unless otherwise
agreed by the Administrative Agent and the applicable Lender or the Issuing
Bank, as the case may be.  The
Administrative Agent or the Parent Borrower (on behalf of the Loan Parties)
may, in its discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it, provided
that approval of such procedures may be limited to particular notices or
communications. All such notices and other communications (i) sent to an
e-mail address shall be deemed received upon the sender’s receipt of an
acknowledgement from the intended recipient (such as by the “return receipt
requested” function, as available, return e-mail or other written
acknowledgement), provided that if not given during the normal
business hours of the recipient, such notice or communication shall be deemed
to have been given at the opening of business on the next Business Day for the
recipient, and (ii) posted to an Internet or intranet website shall be
deemed received upon the deemed receipt by the intended recipient at its e-mail
address as described in the foregoing clause (b)(i) of notification that
such notice or communication is available and identifying the website address
therefor.

 

(c)  Any
party hereto may change its address or facsimile number for notices and other
communications hereunder by notice to the other parties hereto.

 

SECTION 9.02.  Waivers; Amendments.  (a)  No failure or delay by the
Administrative Agent, the Issuing Bank or any Lender in exercising any right or
power hereunder or under any other Loan Document shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power,
or any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power.  The rights and remedies
of the Administrative Agent, the Issuing Bank and the Lenders hereunder and
under any other Loan Document are cumulative and are not exclusive of any
rights or remedies that they would otherwise have.  No waiver of any provision of any Loan
Document or consent to any departure by any Loan Party therefrom shall in any
event be effective unless the same shall be permitted by paragraph (b) of
this Section 9.02, and then such waiver or consent shall be effective only
in the specific instance and for the purpose for which given.  Without limiting the generality of the
foregoing, the making of a Loan, the acceptance and purchase of a B/A or the
issuance, amendment, renewal or extension of a Letter of Credit

 

113

 

shall not be
construed as a waiver of any Default, regardless of whether the Administrative
Agent, any Lender or the Issuing Bank may have had notice or knowledge of such
Default at the time.  No notice or demand
on Holdings or either Borrower in any case shall entitle Holdings or such
Borrower, as the case may be, to any other or further notice or demand in
similar or other circumstances.

 

(b) 
Except as provided in Section 2.21 in connection with any Commitment
Increase Amendment, neither this Agreement nor any other Loan Document nor any
provision hereof or thereof may be waived, amended or modified except in the
case of this Agreement, pursuant to an agreement or agreements in writing
entered into by the Parent Borrower and the Required Lenders or, in the case of
any other Loan Document, pursuant to an agreement or agreements in writing
entered into by the Administrative Agent and the Loan Party or Loan Parties
that are parties thereto, in each case with the consent of the Required Lenders,
provided that no such agreement shall (i) increase the Commitment
of any Lender without the written consent of such Lender (it being understood
that a waiver of any condition precedent in Section 4.01 or 4.02 or the
waiver of a Default or an Event of Default shall not constitute an increase of
any Commitment of a Lender for purposes of this clause (i)), (ii) reduce
or forgive the principal amount of any Loan, B/A or LC Disbursement or reduce
the rate of interest thereon, or reduce or forgive any interest or fees payable
hereunder, without the written consent of each Lender affected thereby (it
being understood that neither (A) any amendment to this Agreement that has
the effect of increasing Availability or Reference Availability and that is
approved by the Required Lenders (or, if applicable, the percentage of Lenders
required under clause (v) or (ix) of this Section 9.02(b)) nor (B) any
waiver or forgiveness of a Default or Event of Default hereunder, shall
constitute a reduction of the rate of interest or Commitment Fees for purposes
of this clause (ii)), (iii) postpone the maturity of any Loan or any
scheduled date of payment of the principal amount of any Loan, B/A or LC
Disbursement, or any date for the payment of any interest, fees or other
Obligations payable hereunder, or reduce the amount of, waive or excuse any
such payment, or postpone the scheduled date of expiration of any Commitment,
without the written consent of each Lender affected thereby, (iv) change Section 2.18(b),
(d) or (e) in a manner that would alter the manner in which payments
are shared, without the written consent of (A) in the case of Section 2.18(b),
each Lender, (B) in the case of Section 2.18(d), each Revolving
Lender and (C) in the case of Section 2.18(e), each Term Lender, (v) increase
the advance rates set forth in the definition of either Borrowing Base, add new
categories of eligible assets or eliminate Reserves that were imposed by the
Required Lenders or by the Administrative Agent at the request of the Required
Lenders, in each case in respect of either Borrowing Base, without the written
consent of Lenders having Revolving Exposure and unused Revolving Commitments
representing more than 66 2/3% of the sum of the total Revolving Exposure and
Revolving Commitments at such time (it being understood and agreed that the
rescission of a Reserve by the Administrative Agent acting in its Permitted
Discretion (as opposed to at the request of the Required Lenders) shall not
require the consent of the Lenders under this clause (v)), (vi) change any
of the provisions of this Section 9.02 or the definition of “Required
Lenders” or any other provision of any Loan Document specifying the number or
percentage of Lenders (or Lenders of any Class) required to waive, amend or
modify any rights thereunder or make any determination or grant any consent
thereunder, without the written consent of each Lender (or each Lender of such
Class, as the case may be) (it being understood that, with the consent of the
Required Lenders, additional extensions of credit pursuant to this Agreement
may be included in the determination of the Required Lenders on substantially
the same basis as the Term Loans and Revolving Commitments on the date hereof),
(vii) release any Loan Guarantor from its obligation under its Loan
Guaranty or limit its liability with respect to such Loan Guaranty (except as
otherwise expressly permitted herein or in the other Loan Documents), without
the written consent of each Lender directly and adversely affected thereby, (viii) except
as expressly provided in this Section 9.02 or in any Collateral Document,
release all or substantially all the Collateral, without the written consent of
each Lender, (ix) eliminate the ineligibility of any portion of the assets
comprising either Borrower Base (including the Availability Block), without the
written consent of Lenders having Revolving Exposure and unused Revolving
Commitments representing more than 66 2/3% of the sum of the total Revolving
Exposure and Revolving 

 

114

 

Commitments at
such time, (x) change any provisions of any Loan Document in a manner that
by its terms adversely affects the rights in respect of Collateral or payments
due to Lenders holding Loans of any Class differently than those holding
Loans of any other Class, without the written consent of Lenders holding a
majority in interest of the outstanding Loans and unused Commitments of each
affected Class, (xi) change to make less favorable to the Revolving Lenders any
of the provisions of (A) Section 9.24 of this Agreement or Section 4.02
of the Domestic Security Agreement (in each case, insofar as such change would
alter the relative priority of the Secured Revolving Obligations and the U.S.
Term Obligations in respect of Collateral and the proceeds therefrom) or Section 9.25,
in each case without the written consent of Lenders having Revolving Exposure
and Revolving Commitments representing more than 66 2/3% of the sum of the
total Revolving Exposure and Revolving Commitments or (B) Section 9.26
(insofar as such change would alter the 100% approval requirement in respect of
the purchase price payable by the Purchasing Party) without the consent of each
Revolving Lender or (xii) modify the protection afforded an SPV pursuant to the
provisions of Section 9.04(e) without the written consent of such
SPV; provided  further that (A) no such agreement shall
amend, modify or otherwise affect the rights or duties of the Administrative
Agent, the Issuing Bank or the Swingline Lender hereunder without the prior
written consent of the Administrative Agent, the Issuing Bank or the Swingline
Lender, as the case may be, (B) any waiver, amendment or modification of
this Agreement that by its terms affects the rights and duties under this
Agreement of Lenders holding Loans or Commitments of a particular Class (but
not Lenders holding Loans or Commitments of any other Class) may be effected by
an agreement or agreements in writing entered into by the Parent Borrower and
the requisite percentage in interest of the affected Class of Lenders that
would be required to consent thereto under this Section if such Class of
Lenders were the only Class of Lenders hereunder at the time, and (C) if
the terms of any waiver, amendment or modification of any Loan Document provide
that any Class of Loans (together with all accrued interest thereon and
all accrued fees payable with respect to the Commitments of such Class) will be
repaid or paid in full, and the Commitments of such Class (if any)
terminated, as a condition to the effectiveness of such waiver, amendment or
modification, then so long as the Loans of such Class (together with such
accrued interest and fees) are in fact repaid or paid and such Commitments are
in fact terminated, in each case prior to or simultaneously with the
effectiveness of such amendment, then such Loans and Commitments shall not be
included in the determination of the Required Lenders with respect to such
amendment.  The Administrative Agent may
also amend the Commitment Schedule to reflect assignments entered into pursuant
to Section 9.04.

 

(c)  The
Lenders hereby irrevocably authorize the Administrative Agent, at its option
and in its sole discretion, to release any Liens granted to the Administrative
Agent by the Loan Parties on any Collateral (i) upon the termination of
all the Commitments, payment and satisfaction in full in cash of all Secured
Obligations (other than Unliquidated Obligations), and the cash
collateralization (or support with a letter of credit reasonably satisfactory to
the Administrative Agent) of all Unliquidated Obligations in a manner
reasonably satisfactory to each affected Lender, (ii) constituting
property being sold or disposed of if the Loan Party disposing of such property
certifies to the Administrative Agent that the sale or disposition is made in
compliance with the terms of this Agreement (and the Administrative Agent may
rely conclusively on any such certificate, without further inquiry), (iii) constituting
property leased to a Loan Party under a lease which has expired or been
terminated in a transaction permitted under this Agreement, or (iv) as
required to effect any sale or other disposition of such Collateral in
connection with any exercise of remedies of the Administrative Agent and the
Lenders pursuant to Article VII. 
Any such release shall not in any manner discharge, affect, or
impair the Obligations or any Liens (other than those expressly being released)
upon (or obligations of the Loan Parties in respect of) all interests retained
by the Loan Parties, including the proceeds of any sale, all of which shall
continue to constitute part of the Collateral. 
The Liens on property described in clauses (c)(i) and (c)(ii) of
this paragraph shall be deemed to be released with no action on the part of any
Person upon the sale, transfer or other disposition thereof.

 

(d)  In
connection with any proposed amendment, modification, waiver or termination (a

 

115

 

“Proposed
Change”) requiring the consent of all Lenders or all affected Lenders, if
the consent of the Required Lenders (and, to the extent any Proposed Change
requires the consent of Lenders holding Loans of any Class pursuant to
clause (vi) or (x) of the first proviso to paragraph (b) of
this Section, the consent of a majority in interest of the outstanding Loans
and unused Commitments of such Class) to such Proposed Change is obtained, but
the consent to such Proposed Change of other Lenders whose consent is required
is not obtained (any such Lender whose consent is not obtained as described in
paragraph (b) of this Section being referred to as a “Non-Consenting
Lender”), then, so long as the Lender that is acting as Administrative
Agent is not a Non-Consenting Lender, the Parent Borrower may, at its sole expense
and effort, upon notice to such Non-Consenting Lender and the Administrative
Agent, require such Non-Consenting Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in Section 9.04),
all its interests, rights and obligations under this Agreement to an assignee
that shall assume such obligations (which assignee may be another Lender, if a
Lender accepts such assignment), provided that (a) the Parent
Borrower shall have received the prior written consent of the Administrative
Agent, the Issuing Bank and the Swingline Lender, which consent shall not
unreasonably be withheld, (b) such Non-Consenting Lender shall have
received payment of an amount equal to the outstanding principal of its Loans
and participations in L/C Disbursements and Swingline Loans and all amounts due
to such Lender in respect of outstanding B/As, accrued interest thereon,
accrued fees and all other amounts payable to it hereunder from the assignee
(to the extent of such outstanding principal and accrued interest and fees) or
the Borrowers (in the case of all other amounts) and (c) the Parent
Borrower or such assignee shall have paid to the Administrative Agent the
processing and recordation fee specified in Section 9.04(b).

 

(e)  In
the event that S&P, Moody’s and Thompson’s BankWatch (or InsuranceWatch
Ratings Service, in the case of Lenders that are insurance companies (or Best’s
Insurance Reports, if such insurance company is not rated by Insurance Watch
Ratings Service)) shall, after the date that any Lender becomes a Lender,
downgrade the long-term certificate of deposit ratings of such Lender, and the
resulting ratings shall be below BBB-, Baa3 and C (or BB, in the case of a
Lender that is an insurance company (or B, in the case of an insurance company
not rated by InsuranceWatch Ratings Service)), then the Issuing Bank shall have
the right, but not the obligation, at its own expense, upon notice to such
Lender and the Administrative Agent and following consultation with the Parent
Borrower, to replace such Lender with an assignee (in accordance with and
subject to the restrictions contained in Section 9.04(b)), and such Lender
hereby agrees to transfer and assign without recourse (in accordance with and
subject to the restrictions contained in Section 9.04(b)) all its
interests, rights and obligations under this Agreement to such assignee; provided,
however, that (i) no such assignment shall conflict with any law, rule and
regulation or order of any Governmental Authority, (ii) such Lender shall
have received payment of an amount equal to the outstanding principal of its
Loans and participations in L/C Disbursements and Swingline Loans and all
amounts due to such Lender in respect of outstanding B/As, accrued interest
thereon, accrued fees and all other amounts payable to it hereunder from the
assignee (to the extent of such outstanding principal and accrued interest and
fees) or the Borrowers (in the case of all other amounts) and (iii) the
Parent Borrower or such assignee shall have paid to the Administrative Agent
the processing and recordation fee specified in Section 9.04(b).

 

SECTION 9.03.  Expenses; Indemnity; Damage Waiver.  (a)  The Borrowers, as applicable, shall
pay (i) all reasonable out-of-pocket expenses incurred by the
Administrative Agent and its Affiliates, including the reasonable fees, charges
and disbursements of counsel for the Administrative Agent, in connection with
the syndication and distribution (including, without limitation, via the
internet or through a service such as Intralinks) of the credit facilities
provided for herein, the preparation and administration of the Loan Documents
or any amendments, modifications or waivers of the provisions of the Loan
Documents (whether or not the transactions contemplated hereby or thereby shall
be consummated), (ii) all reasonable out-of-pocket expenses incurred by
the Issuing Bank in connection with the issuance, amendment, renewal or
extension of any Letter of Credit or any demand for payment

 

116

 

thereunder and (iii) all
out-of-pocket expenses incurred by the Administrative Agent, the Issuing Bank
or any Lender, including the reasonable fees, charges and disbursements of one
counsel for the Administrative Agent, the Issuing Bank and the Lenders (in
addition to one local counsel in each relevant jurisdiction, including Canadian
local counsel), in connection with the enforcement, collection or protection of
its rights in connection with the Loan Documents, including its rights under
this Section 9.03, or in connection with the Loans made, B/As accepted and
purchased or Letters of Credit issued hereunder, including all such
out-of-pocket expenses incurred during 
any workout, restructuring or negotiations in respect of such Loans,
B/As or Letters of Credit.  Expenses
being reimbursed by the Borrowers under this Section 9.03 include, without
limiting the generality of the foregoing, reasonable costs and expenses
incurred in connection with:

 

(i) appraisals (limited to
specified per diem costs and expenses);

 

(ii) field examinations
and the preparation of Reports based on the fees charged by a third party
retained by the Administrative Agent or the internally allocated fees for each
Person employed by the Administrative Agent with respect to each field
examination (limited to specified per diem costs and expenses);

 

(iii) lien and title
searches and title insurance;

 

(iv) taxes, fees and other
charges for recording the Mortgages, filing financing statements and
continuations, and other actions to perfect, protect, and continue the
Administrative Agent’s Liens;

 

(v) sums paid or incurred
to take any action required of any Loan Party under the Loan Documents that
such Loan Party fails to pay or take; and

 

(vi) forwarding loan proceeds,
collecting checks and other items of payment, and establishing and maintaining
the accounts and lock boxes, and costs and expenses of preserving and
protecting the Collateral.

 

All of the foregoing costs and
expenses may be charged to the Parent Borrower as Revolving Loans or to another
deposit account, all as described in Section 2.18(c).  The above list shall not be construed to
negate any specific limitation on the Loan Parties’ obligations to reimburse
items hereunder.

 

(b)  The
Borrowers, as applicable, shall indemnify the Administrative Agent, the Issuing
Bank and each Lender, and each Related Party of any of the foregoing Persons
(each such Person being called an “Indemnitee”) against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, penalties,
liabilities and related expenses, including the reasonable fees, charges and
disbursements of one counsel for the Indemnitees (in addition to one local
counsel in each relevant jurisdiction, including Canadian local counsel), except
in the case where there is a divergent or conflicting interest between the
Administrative Agent and the Lenders, in which case there shall be one separate
counsel for the Administrative Agent, on the one hand, and the Lenders as a
group, on the other hand, incurred by or asserted against any Indemnitee
arising out of, in connection with, or as a result of (i) the execution or
delivery of any Loan Document or any agreement or instrument contemplated
thereby, the performance by the parties to the Loan Documents of their
respective obligations thereunder or the consummation of the Transactions or
any other transactions contemplated thereby, (ii) any Loan, B/A or Letter
of Credit or the use of the proceeds therefrom (including any refusal by the
Issuing Bank to honor a demand for payment under a Letter of Credit if the
documents presented in connection with such demand do not strictly comply with
the terms of such Letter of Credit, but subject to Section 2.05(f)), (iii) any
actual or alleged presence or Release of Hazardous Materials on or from any
property currently or

 

117

 

formerly owned
or operated by Holdings, the Parent Borrower or any Subsidiary, or any
Environmental Liability related in any way to Holdings, the Parent Borrower or
any Subsidiary, or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory, whether brought by a third party or by
Holdings, the Parent Borrower or any Subsidiary and regardless of whether any
Indemnitee is a party thereto, provided that such indemnity shall not,
as to any Indemnitee, be available to the extent that such losses, claims,
damages, penalties, liabilities or related expenses are determined by a court
of competent jurisdiction by final judgment to have resulted from the gross
negligence, bad faith or wilful misconduct of such Indemnitee or any of its
Related Parties.

 

(c)  To
the extent that either Borrower fails to pay any amount required to be paid by
it to the Administrative Agent, the Issuing Bank or the Swingline Lender under
paragraph (a) or (b) of this Section 9.03, each Lender severally
agrees to pay to the Administrative Agent, the Issuing Bank or the Swingline
Lender, as the case may be, such Lender’s pro  rata share
(determined as of the time that the applicable unreimbursed expense or
indemnity payment is sought) of such unpaid amount, provided that the
unreimbursed expense or indemnified loss, claim, damage, penalty, liability or
related expense, as the case may be, was incurred by or asserted against the
Administrative Agent, the Issuing Bank or the Swingline Lender in its capacity
as such.  For purposes hereof, a Lender’s
“pro  rata share” shall be determined based upon its share of the
aggregate Revolving Exposures, outstanding Term Loans and unused Commitments at
the time.

 

(d)  To
the extent permitted by applicable law, no Loan Party shall assert, and each
hereby waives, any claim against any Indemnitee, on any theory of liability,
for special, indirect, consequential or punitive damages (as opposed to direct
or actual damages) arising out of, in connection with, or as a result of, any
Loan Document or any agreement or instrument contemplated hereby, the
Transactions, any Loan, B/A or Letter of Credit or the use of the proceeds
thereof.

 

(e)  All
amounts due under this Section 9.03 shall be payable not later than five
Business Days after written demand therefor.

 

SECTION 9.04.  Successors and Assigns.  (a)  The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Bank that issues any Letter of Credit), except that (i) neither
Borrower may assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by either Borrower without such consent shall be null
and void) and (ii) no Lender may assign or otherwise transfer its rights
or obligations hereunder except in accordance with this Section 9.04.  Nothing in this Agreement, expressed or
implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), Participants
(to the extent provided in paragraph (c) of this Section 9.04) and,
to the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent, the Issuing Bank and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

 

(b)  (i) 
Subject to the conditions set forth in paragraph (b)(ii) below, any Lender
may assign to one or more assignees all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitment
and the Loans at the time owing to it) with the prior written consent (such
consent not to be unreasonably withheld or delayed) of:

 

(A) the Parent Borrower, provided
that no consent of the Parent Borrower shall be required for an assignment to a
Lender, an Affiliate of a Lender, an Approved Fund or,

 

118

 

if an Event of Default has occurred and is
continuing, any other assignee;

 

(B) the Administrative
Agent, provided that no consent of the Administrative Agent shall be
required for an assignment of all or any portion of a Term Loan or Term Commitment;
and

 

(C) the Issuing Bank, provided
that no consent of the Issuing Bank shall be required for an assignment of all
or any portion of a Term Loan or Term Commitment,

 

provided
that, notwithstanding anything in this Agreement to the contrary, the rights
and obligations in respect of any Term Loan may not be assigned hereunder,
except to the Initial Term Lender or a Sponsor Affiliate.

 

(ii) Assignments shall be
subject to the following additional conditions:

 

(A) except in the case of
an assignment to a Lender or an Affiliate of a Lender or an assignment of the
entire remaining amount of the assigning Lender’s Commitment or Loans of any
Class, the amount of the Commitment or Loans of the assigning Lender subject to
each such assignment (determined as of the date the Assignment and Assumption
with respect to such assignment is delivered to the Administrative Agent) shall
not be less than $5,000,000 or, in the case of a Term Loan, $1,000,000, unless
each of the Parent Borrower and the Administrative Agent otherwise consent, provided
that no such consent of the Parent Borrower shall be required if an Event of
Default has occurred and is continuing;

 

(B) each partial
assignment shall be made as an assignment of a proportionate part of all the
assigning Lender’s rights and obligations under this Agreement, provided
that this clause (B) shall not be construed to prohibit assignment of
a proportionate part of all the assigning Lender’s rights and obligations in
respect of one Class of Commitments or Loans;

 

(C) the parties to each
assignment shall execute and deliver to the Administrative Agent an Assignment
and Assumption, together with a processing and recordation fee of $3,500, provided
that assignments made pursuant to Section 2.19(b) or 9.02(d) shall
not require the signature of the assigning Lender to become effective;

 

(D) the assignee, if it
shall not be a Lender, shall deliver to the Administrative Agent an
Administrative Questionnaire and any tax forms required by Section 2.17(e);
and

 

(E) any assignment of all
or a portion of a Revolving Lender’s Revolving Commitment shall be accompanied
by a simultaneous assignment of a pro rata portion of such Lender’s Canadian
Revolving Sub-Commitment.

 

For the
purposes of this paragraph (b) of this Section 9.04, the term “Approved
Fund” has the following meaning:

 

“Approved
Fund” means (a) a CLO and (b) with respect to any Lender that is
a fund that invests in bank loans and similar extensions of credit, any other
fund that invests in bank loans and similar extensions of credit and is managed
by the same investment advisor as such Lender or by an Affiliate of such
investment advisor.

 

119

 

“CLO”
means an entity (whether a corporation, partnership, trust or otherwise) that
is engaged in making, purchasing, holding or otherwise investing in bank loans
and similar extensions of credit in the ordinary course of its business and is
administered or managed by a Lender or an Affiliate of such Lender.

 

(iii) Subject to
acceptance and recording thereof pursuant to paragraph (b)(v) of this
Section 9.04, from and after the effective date specified in each
Assignment and Assumption the assignee thereunder shall be a party hereto and,
to the extent of the interest assigned by such Assignment and Assumption, have
the rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this
Agreement (and, in the case of an Assignment and Assumption covering all of the
assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 2.15, 2.16, 2.17 and 9.03).  Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this Section 9.04
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (c) of
this Section 9.04.

 

(iv) The Administrative
Agent, acting for this purpose as an agent of the Borrowers, shall maintain at one
of its offices a copy of each Assignment and Assumption delivered to it and a
register for the recordation of the names and addresses of the Lenders, and the
Commitment of, and principal amount of the Loans, amounts in respect of B/A
Drawings and L/C Disbursements owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive, and the Borrowers, the Administrative Agent, the Issuing Bank and
the Lenders may treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary.  The Register shall be available for
inspection by the Borrowers, the Issuing Bank and any Lender, at any reasonable
time and from time to time upon reasonable prior notice.

 

(v) Upon its receipt of a
duly completed Assignment and Assumption executed by an assigning Lender and an
assignee, the assignee’s completed Administrative Questionnaire and any tax
forms required by Section 2.17(e) (unless the assignee shall already
be a Lender hereunder), the processing and recordation fee referred to in
paragraph (b) of this Section 9.04 and any written consent to
such assignment required by paragraph (b) of this Section 9.04, the
Administrative Agent shall accept such Assignment and Assumption and record the
information contained therein in the Register, provided that if either
the assigning Lender or the assignee shall have failed to make any payment
required to be made by it pursuant to Section 2.05, Section 2.06(d), Section 2.06(e),
Section 2.07(b), Section 2.18(f) or Section 9.03(c), the
Administrative Agent shall have no obligation to accept such Assignment and
Assumption and record the information therein in the Register unless and until
such payment shall have been made in full, together with all accrued interest
thereon.  No assignment shall be
effective for purposes of this Agreement unless it has been recorded in the
Register as provided in this paragraph.

 

(c)  (i) Any
Lender may, without the consent of any Loan Party, the Administrative Agent,
the Issuing Bank or the Swingline Lender, sell participations to one or more
banks or other entities (a “Participant”) in all or a portion of such
Lender’s rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans owing to it), provided that (A) such
Lender’s obligations under this Agreement shall remain unchanged, (B) such
Lender shall remain solely

 

120

 

responsible to
the other parties hereto for the performance of such obligations and (C) the
Borrowers, the Administrative Agent, the Issuing Bank and the other Lenders
shall continue to deal solely and directly with such Lender in connection with
such Lender’s rights and obligations under this Agreement.  Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement, provided that
such agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver
described in clauses (i), (ii), (iii), (vii) and (viii) of the first
proviso to Section 9.02(b) (to the extent such amendment,
modification or waiver directly and adversely affects such Participant).  Subject to paragraph (c)(ii) of this Section 9.04,
each Borrower agrees that each Participant shall be entitled to the benefits of
Sections 2.15, 2.16 and 2.17 to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to paragraph (b) of this Section 9.04.  To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 9.08 as
though it were a Lender, provided such Participant agrees to be subject
to Section 2.18(c) as though it were a Lender.

 

(ii) A Participant shall
not be entitled to receive any greater payment under Section 2.15 or 2.17
than the applicable Lender would have been entitled to receive with respect to
the participation sold to such Participant, unless the sale of the
participation to such Participant is made with the Parent Borrower’s prior
written consent.  A Participant that
would be a Foreign Lender if it were a Lender shall not be entitled to the
benefits of Section 2.17 unless the Parent Borrower is notified of the
participation sold to such Participant and such Participant agrees, for the
benefit of the Borrowers, to comply with Section 2.17(e) as though it
were a Lender.

 

(d)  Any
Lender may at any time pledge or assign a security interest in all or any
portion of its rights under this Agreement to secure obligations of such
Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section 9.04 shall not
apply to any such pledge or assignment of a security interest, provided
that no such pledge or assignment of a security interest shall release a Lender
from any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto.

 

(e)  (i) Notwithstanding
anything to the contrary contained herein, any Lender (a “Granting Lender”)
may grant to a special purpose funding vehicle organized and administered by
such Lender (an “SPV”), identified as such in writing from time to time
by such Granting Lender to the Administrative Agent and the Parent Borrower,
the option to provide to the applicable Borrower all or any part of any Loan
that such Granting Lender would otherwise be obligated to make to such Borrower
pursuant to this Agreement, provided that (i) nothing herein shall
constitute a commitment by any SPV to make any Loan, (ii) if an SPV elects
not to exercise such option or otherwise fails to provide all or any part of
such Loan, such Granting Lender shall be obligated to make such Loan pursuant
to the terms hereof, (iii) such Granting Lender’s other obligations under
this Agreement shall remain unchanged, (iv) such Granting Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, (v) the Borrowers, the Administrative Agent, the Issuing
Bank and the other Lenders shall continue to deal solely and directly with the
Granting Lender in connection with such Granting Lender’s right and obligations
under this Agreement and (vi) an SPV shall not be entitled to receive any
greater payment under Section 2.15 or Section 2.17 than the
applicable Granting Lender would have been entitled to receive.  The making of a Loan by an SPV hereunder
shall utilize the Commitment of the Granting Lender to the same extent, and as
if, such Loan were made by such Granting Lender.  Any agreement or instrument pursuant to which
the Granting Lender grants such an option to an SPV shall provide that such
Granting Lender shall retain the sole right to enforce this Agreement and to
approve any amendment, modification or waiver of any provision of this Agreement,
provided that such agreement or instrument may provide that such
Granting Lender will not, without

 

121

 

the consent of such SPV, agree to any
amendment, modification or waiver described in clauses (i), (ii), (iii), (vii) and
(viii) of the first proviso to Section 9.02(b) (to the extent
such amendment, modification or waiver directly and adversely affects such
SPV).  Subject to paragraph (e)(ii) of
this Section 9.04, each Borrower agrees that each SPV shall be entitled to
the benefits of Sections 2.15, 2.16 and 2.17 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section 9.04.  To the extent
permitted by law, each SPV also shall be entitled to the benefits of Section 9.08
as though it were a Lender, provided such SPV agrees to be subject to Section 2.18(c) as
though it were a Lender.

 

(ii) An SPV that would be
a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 2.17
unless such SPV agrees, for the benefit of the Borrowers, to comply with Section 2.17(e) as
though it were a Lender.

 

(iii) Each party hereto
hereby agrees that no SPV shall be liable for any indemnity or similar payment
obligation under this Agreement (all liability for which shall remain with the
Granting Lender).  In furtherance of the
foregoing, each party hereto hereby agrees (which agreement shall survive the
termination of this Agreement) that, prior to the date that is one year and one
day after the payment in full of all outstanding commercial paper or other
senior indebtedness of any SPV, such party will not institute against, or join
any other person in instituting against, such SPV any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings under the
laws of the United States or any state thereof or Canada or any province
thereof.

 

(iv) In addition,
notwithstanding anything to the contrary contained in this Section 9.04,
any SPV may (i) with notice to, but without the prior written consent of,
the Parent Borrower and the Administrative Agent and without paying any
processing fee therefor, assign all or a portion of its interests in any Loans
to the Granting Lender or to any financial institutions (consented to by the
Borrower and Administrative Agent) providing liquidity or credit support to or
for the account of such SPV to support the funding or maintenance of Loans and (ii) subject
to Section 9.12, disclose on a confidential basis any non-public
information relating to its Loans to any rating agency, commercial paper dealer
or provider of any surety, guarantee or credit or liquidity enhancement to such
SPV.

 

SECTION 9.05.  Survival.  All covenants, agreements, representations
and warranties made by the Loan Parties in the Loan Documents and in the
certificates or other instruments delivered in connection with or pursuant to
this Agreement or any other Loan Document shall be considered to have been
relied upon by the other parties hereto and shall survive the execution and
delivery of the Loan Documents and the making of any Loans and issuance of any
Letters of Credit, regardless of any investigation made by any such other party
or on its behalf and notwithstanding that the Administrative Agent, the Issuing
Bank or any Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any amount due in respect of any B/A or any fee
or any other amount payable under this Agreement is outstanding and unpaid or
any Letter of Credit is outstanding and so long as the Commitments have not
expired or terminated.  The provisions of
Sections 2.15, 2.16, 2.17, 9.03 and 9.12 and Article VIII shall
survive and remain in full force and effect regardless of the consummation of
the transactions contemplated hereby, the repayment of the Loans and amounts
due in respect of B/As, the expiration or termination of the Letters of Credit
and the Commitments or the termination of this Agreement or any provision
hereof.

 

SECTION 9.06.  Counterparts; Integration; Effectiveness.  This Agreement may be

 

122

 

executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract.  This
Agreement, the other Loan Documents and any separate letter agreements with
respect to fees payable to the Administrative Agent or the syndication of the
Loans and Commitments constitute the entire contract among the parties relating
to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof.  Except as provided in Section 4.01, this
Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received
counterparts hereof that, when taken together, bear the signatures of each Loan
Party party hereto and the Required Restatement Lenders, and thereafter shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns. 
Delivery of an executed counterpart of a signature page of this
Agreement by facsimile shall be effective as delivery of a manually executed
counterpart of this Agreement.

 

SECTION 9.07.  Severability.  Any provision of any Loan Document held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions thereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

 

SECTION 9.08.  Right of Setoff.  If an Event of Default shall have occurred
and be continuing, each Lender, the Issuing Bank and each of its Affiliates is
hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final, in whatever currency) at any
time held and other obligations (in whatever currency) at any time owing by
such Lender, the Issuing Bank or any such Affiliate to or for the credit or the
account of either Borrower or any Loan Guarantor against any of and all the
Secured Obligations held by such Lender or the Issuing Bank, irrespective of
whether or not such Lender or the Issuing Bank shall have made any demand under
the Loan Documents and although such obligations may be unmatured.  The applicable Lender and the Issuing Bank
shall notify the Parent Borrower and the Administrative Agent of such set-off
or application, provided that any failure to give or any delay in giving
such notice shall not affect the validity of any such set-off or application
under this Section 9.08.  The rights
of each Lender, the Issuing Bank and their respective Affiliates under this Section 9.08
are in addition to other rights and remedies (including other rights of setoff)
which such Lender, the Issuing Bank and their respective Affiliates may have.

 

SECTION 9.09.  Governing Law; Jurisdiction; Consent to
Service of Process.  (a)  The
Loan Documents (other than those containing a contrary express choice of law
provision) shall be governed by and construed in accordance with the laws of the
State of New York.

 

(b)  Each Loan Party hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of any U.S. Federal or New York State court sitting in New York,
New York in any action or proceeding arising out of or relating to any Loan
Documents, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in such
New York State or, to the extent permitted by law, in such Federal court.  Each of the parties hereto agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement or any other Loan Document shall
affect any right that the Administrative Agent, the Issuing Bank or any Lender
may otherwise have to bring any action or proceeding relating to this Agreement
or any other Loan Document against any Loan Party or its properties in the
courts of any jurisdiction.

 

123

 

(c)  Each
Loan Party hereby irrevocably and unconditionally waives, to the fullest extent
it may legally and effectively do so, any objection which it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Agreement or any other Loan Document in any court
referred to in paragraph (b) of this Section 9.09.  Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.

 

(d)  Each
party to this Agreement irrevocably consents to service of process in the
manner provided for notices in Section 9.01.  Nothing in this Agreement or any other Loan
Document will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.

 

SECTION 9.10.  WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY).  EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT
IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT
BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.10.

 

SECTION 9.11.  Headings.  Article and Section headings and
the Table of Contents used herein are for convenience of reference only, are
not part of this Agreement and shall not affect the construction of, or be
taken into consideration in interpreting, this Agreement.

 

SECTION 9.12.  Confidentiality.  (a)  Each of the Administrative Agent,
the Issuing Bank and the Lenders agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed (i) to
its and its Affiliates’ directors, officers, employees and agents, including
accountants, legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (ii) to the extent requested by any regulatory authority, provided
that, other than in connection with routine regulatory examinations, the
Administrative Agent, the Issuing Bank or the applicable Lender, as the case
may be, shall use commercially reasonable efforts to give prior notice of such
disclosure to the Parent Borrower to the extent permitted by applicable
Requirements of Law, (iii) to the extent required by Requirement of Law or
by any subpoena or similar legal process, (iv) to any other party to this
Agreement, provided that the Administrative Agent, the Issuing Bank or
the applicable Lender, as the case may be, shall use commercially reasonable
efforts to give prior notice of such disclosure to the Parent Borrower to the
extent permitted by applicable Requirements of Law, (v) in connection with
the exercise of any remedies hereunder or any suit, action or proceeding
relating to this Agreement or any other Loan Document or the enforcement of
rights hereunder or thereunder, (vi) subject to an agreement containing
provisions substantially the same as those of this Section 9.12, to (A) any
assignee of or Participant in, or any prospective assignee of or Participant
in, any of its rights or obligations under this Agreement or (B) any
actual or prospective counterparty (or its advisors) to any swap or derivative
transaction relating to the Loan Parties and their obligations, (vii) with
the consent of the Parent Borrower or (viii) to the extent such
Information (A) becomes publicly available other than as a result of a
breach of this Section 9.12 or (B) becomes available to the
Administrative Agent, the Issuing Bank or any Lender on a nonconfidential basis
from a source other than the Parent Borrower, provided that the source
is not actually known by such disclosing party to be bound by an agreement
containing

 

124

 

provisions
substantially the same as those contained in this Section 9.12.  For the purposes of this Section 9.12, “Information”
means all information received from the Parent Borrower relating to the Parent
Borrower or its business, other than any such information that is available to
the Administrative Agent, the Issuing Bank or any Lender on a nonconfidential
basis prior to disclosure by the Parent Borrower.  Any Person required to maintain the
confidentiality of Information as provided in this Section 9.12 shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.

 

(b)  EACH
LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN SECTION 9.12(a) FURNISHED
TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC
INFORMATION CONCERNING HOLDINGS, THE BORROWERS, THE LOAN PARTIES AND THEIR
RELATED PARTIES OR THEIR RESPECTIVE SECURITIES AND CONFIRMS THAT IT HAS
DEVELOPED COMPLIANCE PROCEDURES REGARDING THE USE OF MATERIAL NON-PUBLIC
INFORMATION AND THAT IT WILL HANDLE SUCH MATERIAL NON-PUBLIC INFORMATION IN
ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND
STATE SECURITIES LAWS.

 

(c)  ALL
INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS FURNISHED BY EITHER
BORROWER OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF
ADMINISTERING, THIS AGREEMENT, WILL BE SYNDICATE-LEVEL INFORMATION, WHICH MAY CONTAIN
MATERIAL NON-PUBLIC INFORMATION ABOUT HOLDINGS, THE BORROWERS, THE LOAN PARTIES
AND THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES.  ACCORDINGLY, EACH LENDER REPRESENTS TO THE
BORROWERS AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED IN ITS ADMINISTRATIVE
QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION THAT MAY CONTAIN
MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS COMPLIANCE PROCEDURES
AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.

 

SECTION 9.13.  Several Obligations; Nonreliance;
Violation of Law.  The respective
obligations of the Lenders hereunder are several and not joint and the failure
of any Lender to make any Loan or perform any of its obligations hereunder
shall not relieve any other Lender from any of its obligations hereunder. Each
Lender hereby represents that it is not relying on or looking to any margin
stock for the repayment of the Borrowings provided for herein.  Anything contained in this Agreement to the
contrary notwithstanding, neither the Issuing Bank nor any Lender shall be
obligated to extend credit to the Borrower in violation of any Requirement of
Law.

 

SECTION 9.14.  USA PATRIOT Act.  Each Lender that is subject to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Act”) hereby notifies each Borrower
that pursuant to the requirements of the Act, it is required to obtain, verify
and record information that identifies such Borrower, which information
includes the name and address of such Borrower and other information that will
allow such Lender to identify such Borrower in accordance with the Act.

 

SECTION 9.15.  Disclosure.  Each Loan Party and each Lender hereby
acknowledges and agrees that the Administrative Agent and/or its Affiliates
from time to time may hold investments in, make other loans to or have other
relationships with any of the Loan Parties and their respective Affiliates.

 

SECTION 9.16.  Appointment for Perfection.  Each Lender hereby appoints each other

 

125

 

Lender as its
agent for the purpose of perfecting Liens, for the benefit of the
Administrative Agent and the Lenders, in assets which, in accordance with Article 9
of the UCC or any other applicable law can be perfected only by
possession.  Should any Lender (other
than the Administrative Agent) obtain possession of any such Collateral, such
Lender shall notify the Administrative Agent thereof, and, promptly upon the
Administrative Agent’s request therefor shall deliver such Collateral to the
Administrative Agent or otherwise deal with such Collateral in accordance with
the Administrative Agent’s instructions.

 

SECTION 9.17.  Interest Rate Limitation.  Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan or B/A
Drawing, together with all fees, charges and other amounts which are treated as
interest on such Loan or B/A Drawing under applicable law (collectively the “Charges”),
shall exceed the maximum lawful rate (the “Maximum Rate”) which may be
contracted for, charged, taken, received or reserved by the Lender holding such
Loan or B/A Drawing in accordance with applicable law, the rate of interest
payable in respect of such Loan or B/A Drawing hereunder, together with all
Charges payable in respect thereof, shall be limited to the Maximum Rate and,
to the extent lawful, the interest and Charges that would have been payable in
respect of such Loan or B/A Drawing but were not payable as a result of the
operation of this Section 9.17 shall be cumulated and the interest and
Charges payable to such Lender in respect of other Loans or B/A Drawings or
periods shall be increased (but not above the Maximum Rate therefor) until such
cumulated amount, together with interest thereon at the Federal Funds Effective
Rate to the date of repayment, shall have been received by such Lender.

 

SECTION 9.18.  Quebec.  For greater certainty, and without limiting
the powers of the Administrative Agent or any other Person acting as an agent,
attorney-in-fact or mandatary for the Administrative Agent under this Agreement
or under any other Loan Document, each Lender and Administrative Agent hereby (a) irrevocably
constitutes, to the extent necessary, the Administrative Agent as the holder of
an irrevocable power of attorney (fondé  de  pouvoir within
the meaning of Article 2692 of the Civil
Code of Québec) for the purposes of holding any Liens, including
hypothecs, granted or to be granted by any Loan Party on movable or immovable
property pursuant to the laws of the Province of Quebec to secure obligations
of a Loan Party under any bond issued by a Loan Party; and (b) appoints
and agrees that the Administrative Agent, acting as agent for the Lenders, may
act as the bondholder and mandatary with respect to any bond that may be issued
and pledged from time to time for the benefit of the Lenders the Administrative
Agent.

 

The said
constitution of the Administrative Agent as fondé  de  pouvoir  (holder of an 
irrevocable power of attorney within the meaning of Article 2692 of
the Civil Code of Québec) and as bondholder
and mandatary with respect to any such bond shall be deemed to have been
ratified and confirmed by any assignee pursuant to Section 9.04 by the
execution of the applicable Assignment and Assumption.

 

Notwithstanding
the provisions of Section 32 of An Act respecting the special powers of
legal persons (Quebec), the Administrative Agent may purchase, acquire and
be the holder of any bond issued by any Loan Party.  Each Loan Party hereby acknowledges that any
such bond shall constitute a title of indebtedness, as such term is used in Article 2692
of the Civil Code of Québec.

 

The
Administrative Agent herein appointed as fondé  de  pouvoir
shall have the same rights, powers and immunities of the Administrative Agent
as stipulated in Article VIII, which shall apply mutatis  mutandis.  Without limitation, the provisions of Article VIII
of this Agreement shall apply mutatis  mutandis to the resignation
and appointment of a successor to the Administrative Agent acting as fondé
de  pouvoir.

 

SECTION 9.19.  Judgment Currency.  (a)  The obligations of any Loan Party
under this

 

126

 

Agreement and
the other Loan Documents to make payments in U.S. Dollars or in Canadian
Dollars (in any such case, the “Obligation Currency”) shall not be
discharged or satisfied by any tender or recovery pursuant to any judgment
expressed in or converted into any currency other than the Obligation Currency,
except to the extent that such tender or recovery results in the effective
receipt by the Administrative Agent, the Issuing Bank or the respective Lender,
as the case may be, of the full amount of the Obligation Currency expressed to
be payable to the Administrative Agent, the Issuing Bank or such Lender, as the
case may be, under this Agreement or the other Loan Documents.  If, for the purpose of obtaining or enforcing
a judgment against any Loan Party in any court or in any jurisdiction, it
becomes necessary to convert into or from any currency other than the
Obligation Currency (such other currency, the “Judgment Currency”) an
amount due in the Obligation Currency, the conversion shall be made at the rate
of exchange quoted by the Administrative Agent, determined, in each case, as of
the business day immediately preceding the day on which the judgment is given
(such business day, the “Judgment Currency Conversion Date”).

 

(b)  If
there is a change in the rate of exchange prevailing between the Judgment
Currency Conversion Date and the date of actual payment of the amount due, each
Loan Party covenants and agrees to pay, or cause to be paid, such additional
amounts, if any (but in any event not a lesser amount), as may be necessary to
ensure that the amount paid in the Judgment Currency, when converted at the
rate of exchange prevailing on the actual date of payment, will produce the
amount of the Obligation Currency that could have been purchased with the
amount of the Judgment Currency stipulated in the judgment or judicial award at
the rate of exchange prevailing on the Judgment Currency Conversion Date.

 

(c)  For
purposes of determining any rate of exchange for this Section 9.19, such
amounts shall include any premium and costs payable in connection with the
purchase of the Obligation Currency.

 

SECTION 9.20.  Obligations of the Canadian Subsidiary
Borrower and Foreign Subsidiary Loan Parties.  Notwithstanding anything contained herein or
in the other Loan Documents to the contrary, none of the Canadian Subsidiary
Borrower or any Foreign Subsidiary Loan Party shall be liable for any U.S.
Secured Obligations, and none of the Collateral pledged by the Canadian
Subsidiary Borrower or any Foreign Subsidiary Loan Party shall secure any U.S.
Secured Obligations.  In addition, any
insurance proceeds from any Collateral pledged by the Canadian Subsidiary
Borrower or any Foreign Subsidiary Loan Party shall not be available to pay any
U.S. Secured Obligations.

 

SECTION 9.21.  Intercreditor Agreement.  Each Lender hereby ratifies the appointment
under the Original Credit Agreement of JPMorgan Chase Bank, N.A. to act as
intercreditor agent (the “Intercreditor Agent”) under the Intercreditor
Agreement and hereby ratifies the execution of the Intercreditor Agreement by
the Intercreditor Agent in the name of and for the benefit of the Lenders.  Each Lender further expressly accepts and
agrees to the terms and provisions of the Intercreditor Agreement.

 

SECTION 9.22.  Effectiveness of Amendment and
Restatement; No Novation.  (a) 
Until this Agreement becomes effective in accordance with the terms hereof, the
Original Credit Agreement shall remain in full force and effect and shall not
be affected hereby.  On and after the
Restatement Effective Date, all obligations of Holdings, each Borrower and each
Subsidiary Loan Party under the Original Credit Agreement shall become
obligations of Holdings, such Borrower or such Subsidiary Loan Party, as
applicable, hereunder, secured by the Security Documents, and the provisions of
the Original Credit Agreement shall be superseded by the provisions hereof.

 

(b)  This
Agreement shall not extinguish the Loans, any Letters of Credit or any B/As
outstanding under the Original Credit Agreement or the Guarantees of the Loan
Parties under Article X

 

127

 

thereof.  Nothing herein contained shall be construed
as a substitution or novation of the Loans, Letters of Credit or B/As
outstanding under the Original Credit Agreement or of the Guarantees of the
Loan Parties under Article X thereof, which shall remain outstanding after
the Restatement Effective Date as modified hereby.  Notwithstanding any provision of this
Agreement, the provisions of Sections 2.15, 2.16, 2.17 and 9.03 of the Original
Credit Agreement as in effect immediately prior to the Restatement Effective
Date will continue to be effective as to all matters arising out of or in any
way related to facts or events existing or occurring prior to the Restatement
Effective Date.

 

SECTION 9.23.  Amendment of Security Documents.  By execution of this Agreement, the Lenders
hereby consent to the amendment or amendment and restatement, as applicable, of
the Security Agreements (as such term is defined in the Original Credit
Agreement), to the extent necessary, as contemplated by this Agreement.

 

SECTION 9.24.  Application of Collateral Proceeds.  (a)  Each of the Lenders hereby agrees
that the Administrative Agent shall apply the proceeds of any collection or
sale of Collateral, including any Collateral consisting of cash, under the
Domestic Security Agreement or any other Collateral Document securing the U.S.
Obligations as follows:

 

(i) FIRST, to the payment
of all costs and expenses incurred by the Administrative Agent in connection
with such collection or sale or otherwise in connection with any Loan Document
or any of the Secured Obligations, including all court costs and the fees and
expenses of its agents and legal counsel, the repayment of all advances made by
the Administrative Agent under any Loan Document on behalf of any Loan Party
and any other costs or expenses incurred in connection with the exercise of any
right or remedy under any Loan Document;

 

(ii) SECOND, until the
Discharge of Revolving Lender Claims has occurred, to the payment in full of
the Secured Revolving Obligations (the amounts so applied to be distributed
among the Secured Parties pro  rata in accordance with the amounts
of the Secured Revolving Obligations owed to them on the date of any such
distribution);

 

(iii) THIRD, to the
payment in full of the U.S. Term Obligations (the amounts so applied to be
distributed among the Secured Parties pro  rata in accordance with
the amounts of the U.S. Term Obligations owed to them on the date of any such
distribution); and

 

(iv) FOURTH, to the Loan
Parties, their successors or assigns, or as a court of competent jurisdiction
may otherwise direct.

 

(b) So
long as the Discharge of Revolving Lender Claims has not occurred, any
Collateral, or any proceeds of Collateral or payment with respect thereto,
received by the Term Lenders in connection with the exercise of any right or
remedy (including any right of setoff) or in connection with any Insolvency or
Liquidation Proceeding of any Grantor in contravention of the allocation
priority set forth in paragraph (a) of this Section shall be
segregated and held in trust for the benefit of and forthwith transferred or
paid over to the Administrative Agent for the benefit of the other Secured
Parties in the same form as received, with any necessary endorsements, or as a
court of competent jurisdiction may otherwise direct, and the Administrative
Agent shall apply such proceeds as provided in such paragraph (a), provided
that if, in connection with any Insolvency or Liquidation Proceeding of any
Grantor, any securities (including debt securities and equity securities;
collectively, the “New Securities”) are distributed pursuant to a plan
of reorganization or similar dispositive restructuring plan on account of the
Secured Revolving Obligations and on account of the U.S. Term Obligations, the
holders of the

 

128

 

U.S. Term
Obligations shall be entitled to retain any such New Securities distributed
under any such plan only if such New Securities are subject to transfer and
payment over to the Administrative Agent, for the benefit of the other Secured
Parties, on the terms and conditions set forth in this Section 9.24; provided
further that, so long as the Discharge of Revolving Lender Claims has
not occurred, any payments received by the Term Lenders in respect of such New
Securities shall be transferred or paid to the Administrative Agent for the
benefit of the other Secured Parties in accordance with this Section 9.24(b).  The provisions of Sections 9.24 and 9.25 will
survive the distribution of such New Securities pursuant to such plan and will
remain in full force and effect in respect of such New Securities as if the
obligations in respect of such New Securities constituted Secured Revolving
Obligations and U.S. Term Obligations, respectively, hereunder.  For purposes of the second proviso to this Section 9.24(b),
a “Discharge of Revolving Lender Claims” shall not have occurred until
the Revolving Lenders shall have been paid in full in cash in an amount equal
to (without duplication) (i) all principal, interest (including interest accruing
during the pendency of any such Insolvency or Liquidation Proceeding,
regardless of whether or not allowed in such Insolvency or Liquidation
Proceeding) and other Secured Revolving Obligations under this Agreement (or,
with respect to Letters of Credit outstanding hereunder, either termination
thereof or delivery of cash collateral in respect thereof on terms
substantially similar to those in Section 2.05(j) of this Agreement
(or, in lieu of such cash collateral, enter into a backstop letter of credit in
favor of the Administrative Agent, in form reasonably satisfactory to the
Administrative Agent, in an amount equal to 105% of the face amount of such
Letters of Credit)), in each case as such Secured Revolving Obligations are
valued immediately prior to the commencement of such Insolvency or Liquidation
Proceeding (but taking into account interest accruing during the pendency of
such Insolvency or Liquidation Proceeding, regardless of whether or not allowed
in such Insolvency or Liquidation Proceeding), plus (ii) all other
Secured Revolving Obligations that are due and payable or otherwise accrued and
owing at or prior to the time such principal and interest are paid, in each
case (A) as such Secured Revolving Obligations are valued immediately
prior to the commencement of such Insolvency or Liquidation Proceeding and (B) other
than contingent indemnities and costs and reimbursement obligations to the
extent no claim has been made, minus (iii) the value as of the date
the applicable plan of reorganization or similar dispositive restructuring plan
becomes effective of any such New Securities, as well as the value as of such
date of any other Collateral or proceeds thereof, distributed to the holders of
Secured Revolving Obligations under such plan or during the pendency of such
Insolvency or Liquidation Proceeding. 
The Administrative Agent is hereby authorized to make any such
endorsements as agent for the Term Lenders. 
This authorization is coupled with an interest and is irrevocable but
shall terminate automatically upon the Discharge of Revolving Lender Claims.

 

(c) With
respect to the value of any payments or distributions in cash, property or
other assets that any holder of U.S. Term Obligations pays over to or for the
benefit of any holder of Secured Revolving Obligations under the terms of this
Agreement, such holder of U.S. Term Obligations shall be subrogated to the
rights of the holders of Secured Revolving Obligations, provided that
such holder of U.S. Term Obligations hereby agrees not to assert or enforce any
such rights of subrogation it may acquire as a result of any payment hereunder
until the Discharge of Revolving Lender Claims has occurred.  Each Grantor acknowledges and agrees that the
value of any payments or distributions in cash, property or other assets
received by the holders of U.S. Term Obligations that are paid over to or for
the benefit of any holder of Secured Revolving Obligations shall not reduce any
of the U.S. Term Obligations.

 

(d) Each
of the Lenders hereby acknowledges that the terms of the Collateral Documents
shall govern the rights of the Lenders in respect of the Collateral.

 

SECTION 9.25.  Bankruptcy Proceedings.  (a)  The agreements contained in
Sections 9.24, 9.25 and 9.26 shall be applicable both before and after the
filing of any petition by or against any Grantor in connection with any
Insolvency or Liquidation Proceeding and all converted or succeeding

 

129

 

cases in
respect thereof, and all references herein to any Grantor shall be deemed to
apply to the trustee for such Grantor and such Grantor as a
debtor-in-possession.

 

(b) 
Notwithstanding anything herein to the contrary, until the Discharge of
Revolving Lender Claims has occurred, the Term Lenders will not, in the event
of any Insolvency or Liquidation Proceeding of any Grantor, (i) oppose or
object to (or support any other Person opposing or objecting to) the use of any
Collateral constituting cash collateral under Section 363 of the
Bankruptcy Code, or any comparable provision of any other Bankruptcy Law or any
post-petition financing, whether provided by any of the Revolving Lenders or
any other Person, under Section 364 of the Bankruptcy Code, or any
comparable provision of any other Bankruptcy Law (“DIP Financing”) so
long as the DIP Financing does not compel any Grantor to seek confirmation of a
specific plan of reorganization for which all or substantially all the material
terms are set forth in the DIP Financing documentation or a related document,
other than providing for satisfaction in full in cash of the DIP Financing on
or prior to the effective date of such plan of reorganization, (ii) oppose
or object to (or support any other Person opposing or objecting to) the payment
of interest, fees, expenses or other amounts of the Administrative Agent, the
Issuing Bank or any Revolving Lender under Section 506(b) of the
Bankruptcy Code or any comparable provision of any other Bankruptcy Law, (iii) oppose
or object to (or support any other Person opposing or objecting to) a motion to
sell or otherwise dispose of any Collateral free and clear of its Liens or
other claims under Section 363 of the Bankruptcy Code, or any comparable
provision of any other Bankruptcy Law so long as the Administrative Agent, for
the benefit of the Secured Parties, shall have a Lien on any proceeds resulting
from such sale or other disposition, (iv) except to the extent permitted
under paragraph (c) of this Section 9.25 or as otherwise agreed by
the Administrative Agent, request adequate protection with respect to its
rights in the Collateral, (v) oppose or object to (or support any other
Person opposing or objecting to) any motion for relief from the automatic stay
or from any injunction against foreclosure or enforcement in respect of claims
made by the Administrative Agent (for the benefit of the Secured Parties) or (vi) oppose
or object to (or support any other Person opposing or objecting to) any lawful
exercise by the Administrative Agent (for the benefit of the Secured Parties)
of the right to credit bid the Secured Obligations at any sale of Collateral.

 

(c)  In
any Insolvency or Liquidation Proceeding of any Grantor, the Term Lenders will
not oppose or object to (or support any other Person in opposing or objecting
to) (i) any request by the Administrative Agent, the Issuing Bank or any
Revolving Lender for adequate protection or (ii) any objection, based on a
claim of a lack of adequate protection, by the Administrative Agent, the
Issuing Bank or any Revolving Lender, to any motion, relief, action or
proceeding of any Grantor. 
Notwithstanding anything contained in Section 9.25(b) or (c),
in any Insolvency or Liquidation Proceeding, if the Administrative Agent, the
Issuing Bank or the Revolving Lenders (or any subset thereof) are granted
adequate protection in the form of a replacement Lien on additional collateral
in connection with any DIP Financing or use of cash collateral under Sections
363 or 364 of the Bankruptcy Code or any similar provision of any other
Bankruptcy Law, then the Term Lenders may seek or request adequate protection
in the form of a replacement Lien on such additional collateral, which
replacement Lien shall be pari passu with any replacement Lien granted to the
Administrative Agent, the Issuing Bank or the Revolving Lenders, as the case
may be, provided that the priority of any distributions made by any Grantor in
respect of any such replacement Lien or administrative expense claim shall be
governed by Section 9.24.

 

(d) 
Until the Discharge of Revolving Lender Claims has occurred, the Term Lenders
agree that none of them shall seek relief from, or modification of, the
automatic stay or any other stay in any Insolvency or Liquidation Proceeding or
take any action in derogation thereof, in each case in respect of any
Collateral, without the prior written consent of the Administrative Agent
(acting with the consent of Revolving Lenders holding a majority of the
Revolving Exposure at such time).

 

130

 

(e) 
Notwithstanding the foregoing, any holder of U.S. Term Obligations may (i) file
a proof of claim or statement of interest with respect to the U.S. Term
Obligations in any Insolvency or Liquidation Proceeding commenced by or against
any Grantor; (ii) take any action (other than any action that is
inconsistent with the priority of payments set forth in Section 9.24 or
that is otherwise adverse to the priority status of the Liens on the Collateral
securing the Secured Revolving Obligations or the rights of the holders of
Secured Revolving Obligations to exercise remedies in respect thereof) in order
to preserve or protect its Lien on the Collateral; (iii) file any
necessary responsive or defensive pleadings in opposition to any motion, claim,
adversary proceeding or other pleading made by any Person objecting to or
otherwise seeking the disallowance of the claims of the holders of U.S. Term
Obligations, including any claims secured by the Collateral, if any, in each
case in accordance with the terms of this Agreement; (iv) file any
pleadings, objections, motions or agreements which assert rights available to
unsecured creditors of the Grantors arising under any Bankruptcy Law or
applicable non-bankruptcy law, in each case not inconsistent with the terms of this
Agreement; (v) vote on any plan of reorganization; and (vi) exercise
any of its rights or remedies with respect to the Collateral after the
Discharge of Revolving Lender Claims.

 

SECTION 9.26.  Purchase Right.  (a)  Without limiting the rights of the holders
of Secured Revolving Obligations under Sections 9.24 and 9.25, the holders of
Secured Revolving Obligations agree that at any time following (i) acceleration
of the Obligations in accordance with the terms of this Agreement or (ii) the
commencement of an Insolvency or Liquidation Proceeding (each, a “Purchase
Event”), one or more of the holders of U.S. Term Obligations may request
within 60 days after the first date on which a Purchase Event occurs, and the
holders of Secured Revolving Obligations hereby offer the holders of U.S. Term
Obligations the option, to purchase all, but not less than all (except as
expressly set forth in paragraph (b) of this Section 9.26), of the
aggregate amount of Secured Revolving Obligations outstanding at the time of purchase
at par (or at a price otherwise approved by 100% of the Revolving Lenders)
without warranty or representation or recourse (except for representations and
warranties required to be made by assigning lenders pursuant to an Assignment
and Assumption).  If a holder of the U.S.
Term Obligations (a “Purchasing Party”) intends to exercise such right,
it shall deliver written notice to the Administrative Agent specifying the date
on which the purchase shall occur, which date shall be a Business Day not less
than three Business Days nor more than 12 Business Day after receipt by the
Administrative Agent of such written notice. 
Such notice from a Purchasing Party shall be irrevocable.   If one or more of the holders of U.S. Term
Obligations exercises such purchase right, it shall be exercised pursuant to
documentation mutually acceptable to the Administrative Agent and such
holder(s).  If none of the holders of
U.S. Term Obligations exercises such right within 60 days after the first date
on which a Purchase Event occurs, the holders of Secured Revolving Obligations
shall have no further obligations pursuant to this Section 9.26 for such
Purchase Event and may take any further actions in their sole discretion in
accordance with this Agreement and the other Loan Documents.

 

(b)  On
the date (the “Purchase Date”) specified by the Purchasing Party in any
notice delivered by such Purchasing Party in accordance with paragraph (a) of
this Section 9.26, the holders of the Secured Revolving Obligations shall,
subject to any required approval of any court or other Governmental Authority,
if any, sell to the Purchasing Party, and the Purchasing Party shall purchase
from the holders of the Secured Revolving Obligations, all of the Secured
Revolving Obligations, provided that the Secured Revolving Obligations
purchased shall not include any right of the holders of the Secured Revolving
Obligations with respect to any indemnification obligations of the Grantors
under the Loan Documents.  The Purchasing
Party shall be irrevocably and unconditionally obligated to effect such
purchase on the terms in this Section 9.26 not later than the Purchase Date.

 

(c)  On
the Purchase Date, the Purchasing Party shall remit in immediately available
funds to such bank account of the Administrative Agent as the Administrative
Agent may designate in writing to the Purchasing Party for such purpose the
following amounts: (i) the full amount of the Secured

 

131

 

Revolving
Obligations then outstanding and unpaid (including principal, interest, fees
and expenses, including attorneys’ fees and expenses and, in the case of any
Swap Agreement, if terminated, the amount that would be payable by the Parent
Borrower or any of its Subsidiaries if it were to terminate such Swap Agreement
on the date of such purchase and sale or, if not terminated, an amount
reasonably determined by the applicable Revolving Lender (or Affiliate thereof)
party to such Swap Agreement to be necessary to collateralize its credit risk
arising from such Swap Agreement) and (ii) furnish to the Administrative
Agent an amount in cash equal to 105% of the U.S. L/C Exposure and the Canadian
L/C Exposure (subject to return if the Letters of Credit expire or are
canceled).  From time to time after the
Purchase Date, upon demand, the Purchasing Party shall reimburse the
Administrative Agent and the Revolving Lenders for any loss, cost, damage or
expense (including reasonable attorneys’ fees and expenses) in connection with
any fees, costs or expenses related to any checks or other payments
provisionally credited to the Secured Revolving Obligations and/or as to which
the Revolving Lenders have not yet received final payment.

 

(d)  The
Administrative Agent shall, promptly following its receipt thereof, distribute
the amounts received by it in respect of such purchase price to the Secured
Parties ratably according to the Secured Revolving Obligations owing to the
Secured Parties.  Interest shall be
calculated to but excluding the day on which such purchase and sale occur, if
the amounts so paid by the Purchasing Party to the bank account designated by
the Administrative Agent are received in such bank account prior to 12:00 noon,
New York City time, and interest shall be calculated to and including such day
if the amounts so paid by the Purchasing Party to the bank account designated
by the Administrative Agent are received in such bank account later than 12:00
noon, New York City time.

 

ARTICLE X

 

Loan Guaranty

 

SECTION 10.01.  Guaranty.  (a)  Each U.S. Loan Guarantor hereby
agrees that it is jointly and severally liable for, and, as primary obligor and
not merely as surety, absolutely and unconditionally guarantees to the Lenders
the prompt payment when due, whether at stated maturity, upon acceleration or
otherwise, and at all times thereafter, of the Secured Obligations and all
costs and expenses including, without limitation, all court costs and attorneys’
and paralegals’ fees and expenses paid or incurred by the Administrative Agent,
the Issuing Bank and the Lenders in endeavoring to collect all or any part of
the Secured Obligations from, or in prosecuting any action against, either
Borrower, any Loan Guarantor or any other guarantor of all or any part of the
Secured Obligations (such costs and expenses, together with the Secured
Obligations, collectively the “U.S. Guaranteed Obligations”).  Each U.S. Loan Guarantor further agrees that
the U.S. Guaranteed Obligations may be extended or renewed in whole or in part
without notice to or further assent from it, and that it remains bound upon its
guarantee notwithstanding any such extension or renewal.

 

(b)  Each Foreign Loan
Guarantor hereby agrees that it is jointly and severally liable for, and, as
primary obligor and not merely as surety, absolutely and unconditionally
guarantees to the Lenders the prompt payment when due, whether at stated
maturity, upon acceleration or otherwise, and at all times thereafter, of the
Canadian Secured Obligations and all costs and expenses including, without
limitation, all court costs and attorneys’ and paralegals’ fees and expenses
paid or incurred by the Administrative Agent, the Issuing Bank and the Lenders
in endeavoring to collect all or any part of the Canadian Secured Obligations
from, or in prosecuting any action against, either Borrower, any Loan Guarantor
or any other guarantor of all or any part of the Canadian Secured Obligations
(such costs and expenses, together with the Canadian Secured Obligations,
collectively the “Foreign Guaranteed Obligations” and, together with the
U.S. Guaranteed Obligations, the “Guaranteed Obligations”).  Each Foreign Loan Guarantor further agrees
that the Foreign Guaranteed Obligations

 

132

 

may be extended or renewed in whole or in
part without notice to or further assent from it, and that it remains bound
upon its guarantee notwithstanding any such extension or renewal.

 

(c)  All terms of this
Loan Guaranty apply to and may be enforced by or on behalf of any domestic or
foreign branch or Affiliate of any Lender that extended any portion of the
Guaranteed Obligations.

 

SECTION 10.02.  Guaranty of Payment.  This Loan Guaranty is a guaranty of payment
and not of collection.  Each Loan
Guarantor waives any right to require the Administrative Agent, the Issuing
Bank or any Lender to sue either Borrower, any Loan Guarantor, any other
guarantor, or any other person obligated for all or any part of the Guaranteed
Obligations (each, an “Obligated Party”), or otherwise to enforce its
payment against any collateral securing all or any part of the Guaranteed
Obligations.

 

SECTION 10.03.  No
Discharge or Diminishment of Loan Guaranty.  (a)  Except as
otherwise provided for herein, the obligations of each Loan Guarantor hereunder
are unconditional and absolute and not subject to any reduction, limitation,
impairment or termination for any reason (other than the payment in full in
cash of the U.S. Guaranteed Obligations or the Foreign Guaranteed Obligations,
as the case may be), including:  (i) any
claim of waiver, release, extension, renewal, settlement, surrender,
alteration, or compromise of any of the Guaranteed Obligations, by operation of
law or otherwise; (ii) any change in the corporate existence, structure or
ownership of either Borrower or any other guarantor of or other person liable
for any of the Guaranteed Obligations; (iii) any insolvency, bankruptcy,
reorganization or other similar proceeding affecting any Obligated Party, or
their assets or any resulting release or discharge of any obligation of any
Obligated Party; or (iv) the existence of any claim, setoff or other
rights which any Loan Guarantor may have at any time against any Obligated
Party, the Administrative Agent, the Issuing Bank, any Lender, or any other
person, whether in connection herewith or in any unrelated transactions.

 

(b)  The
obligations of each Loan Guarantor hereunder are not subject to any defense or
setoff, counterclaim, recoupment, or termination whatsoever by reason of the
invalidity, illegality, or unenforceability of any of the Guaranteed
Obligations or otherwise, or any provision of applicable law or regulation
purporting to prohibit payment by any Obligated Party, of the Guaranteed
Obligations or any part thereof.

 

(c) 
Further, the obligations of any Loan Guarantor hereunder are not discharged or
impaired or otherwise affected by: (i) the failure of the Administrative
Agent, the Issuing Bank or any Lender to assert any claim or demand or to
enforce any remedy with respect to all or any part of the Guaranteed
Obligations; (ii) any waiver or modification of or supplement to any
provision of any agreement relating to the Guaranteed Obligations; (iii) any
release, non-perfection, or invalidity of any indirect or direct security for
the obligations of either Borrower for all or any part of the Guaranteed
Obligations or any obligations of any other guarantor of or other person liable
for any of the Guaranteed Obligations; (iv) any action or failure to act
by the Administrative Agent, the Issuing Bank or any Lender with respect to any
collateral securing any part of the Guaranteed Obligations; or (v) any
default, failure or delay, willful or otherwise, in the payment or performance
of any of the Guaranteed Obligations, or any other circumstance, act, omission
or delay that might in any manner or to any extent vary the risk of such Loan
Guarantor or that would otherwise operate as a discharge of any Loan Guarantor
as a matter of law or equity (other than the payment in full in cash of the
Guaranteed Obligations).

 

SECTION 10.04.  Defenses Waived.  To the fullest extent permitted by applicable
law, each Loan Guarantor hereby waives any defense based on or arising out of
any defense of either Borrower or any Loan Guarantor or the unenforceability of
all or any part of the Guaranteed Obligations

 

133

 

from any
cause, or the cessation from any cause of the liability of either Borrower or
any Loan Guarantor, other than the payment in full in cash of the Guaranteed
Obligations. Without limiting the generality of the foregoing, each Loan Guarantor irrevocably waives acceptance
hereof, presentment, demand, protest and, to the fullest extent permitted by
law, any notice not provided for herein, as well as any requirement that at any
time any action be taken by any person against any Obligated Party, or any other person.  The Administrative Agent may, at its
election, foreclose on any Collateral held by it by one or more judicial or
nonjudicial sales, accept an assignment of any such Collateral in lieu of
foreclosure or otherwise act or fail to act with respect to any collateral
securing all or a part of the Guaranteed Obligations, compromise or adjust any
part of the Guaranteed Obligations, make any other accommodation with any Obligated
Party or exercise any other right or remedy available to it against any
Obligated Party, without affecting or impairing in any way the liability of
such Loan Guarantor under this Loan Guaranty except to the extent the
Guaranteed Obligations have been fully paid in cash.  To the fullest extent permitted by applicable
law, each Loan Guarantor waives any defense arising out of any such election
even though that election may operate, pursuant to applicable law, to impair or
extinguish any right of reimbursement or subrogation or other right or remedy
of any Loan Guarantor against any Obligated Party or any security.

 

SECTION 10.05.  Rights
of Subrogation.  No Loan Guarantor
will assert any right, claim or cause of action, including, without limitation,
a claim of subrogation, contribution or indemnification that it has against any
Obligated Party, or any collateral, until the Loan Parties and the Loan
Guarantors have fully performed all their obligations (other than Unliquidated
Obligations) to the Administrative Agent, the Issuing Bank and the Lenders.

 

SECTION 10.06.  Reinstatement;
Stay of Acceleration.  If at any time
any payment of any portion of the Guaranteed Obligations is rescinded or must
otherwise be restored or returned upon the insolvency, bankruptcy, or
reorganization of either Borrower or otherwise, each Loan Guarantor’s
obligations under this Loan Guaranty with respect to that payment shall be
reinstated at such time as though the payment had not been made and whether or
not the Administrative Agent, the Issuing Bank and the Lenders are in
possession of this Loan Guaranty. If
acceleration of the time for payment of any of the Guaranteed Obligations is
stayed upon the insolvency, bankruptcy or reorganization of either Borrower,
all such amounts otherwise subject to acceleration under the terms of any
agreement relating to the Guaranteed Obligations shall nonetheless be payable
by the Loan Guarantors forthwith on demand by the Lender.

 

SECTION 10.07.  Information.  Each Loan Guarantor assumes all responsibility
for being and keeping itself informed of the applicable Borrower’s financial
condition and assets, and of all other circumstances bearing upon the risk of
nonpayment of the applicable Guaranteed Obligations and the nature, scope and
extent of the risks that each Loan Guarantor assumes and incurs under this Loan
Guaranty, and agrees that neither the Administrative Agent, the Issuing Bank
nor any Lender shall have any duty to advise any Loan Guarantor of information
known to it regarding those circumstances or risks.

 

SECTION 10.08.  Taxes. 
All payments of the Guaranteed Obligations will be made by each Loan
Guarantor free and clear of and without deduction for any Indemnified Taxes or
Other Taxes, provided that if any Loan Guarantor shall be required to
deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the
sum payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 10.08) the Administrative Agent, Lender or Issuing Bank (as
the case may be) receives an amount equal to the sum it would have received had
no such deductions been made, (ii) such Loan Guarantor shall make such
deductions and (iii) such Loan Guarantor shall pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable
law.

 

SECTION 10.09.  Maximum
Liability.  The provisions of this
Loan Guaranty are

 

134

 

severable, and
in any action or proceeding involving any state, provincial or foreign
corporate law, or any federal, state, provincial or foreign bankruptcy,
insolvency, reorganization or other law affecting the rights of creditors
generally, if the obligations of any Loan Guarantor under this Loan Guaranty
would otherwise be held or determined to be avoidable, invalid or unenforceable
on account of the amount of such Loan Guarantor’s liability under this Loan
Guaranty, then, notwithstanding any other provision of this Loan Guaranty to
the contrary, the amount of such liability shall, without any further action by
the Loan Guarantors or the Lenders, be automatically limited and reduced to the
highest amount that is valid and enforceable as determined in such action or
proceeding (such highest amount determined hereunder being the relevant Loan
Guarantor’s “Maximum Liability”). 
This Section 10.09 with respect to the Maximum Liability of each
Loan Guarantor is intended solely to preserve the rights of the Lenders to the
maximum extent not subject to avoidance under applicable law, and no Loan
Guarantor nor any other person or entity shall have any right or claim under
this Section 10.09 with respect to such Maximum Liability, except to the
extent necessary so that the obligations of any Loan Guarantor hereunder shall
not be rendered voidable under applicable law. 
Each Loan Guarantor agrees that the
Guaranteed Obligations may at any time and from time to time exceed the Maximum
Liability of each Loan Guarantor without impairing this Loan Guaranty or
affecting the rights and remedies of the Lenders hereunder, provided
that nothing in this sentence shall be construed to increase any Loan Guarantor’s
obligations hereunder beyond its Maximum Liability.

 

As an original
and independent obligation under this Guaranty, each U.S. Loan Guarantor or
Foreign Loan Guarantor, as the case may be, shall indemnify each of the
Administrative Agent, the Issuing Bank and each Lender (together with its
Affiliates, if applicable; such Persons, the “Guaranteed Parties”) and
keep each of them indemnified against all costs, losses, expenses and
liabilities of whatever kind resulting from the failure by any of the U.S. Loan
Guarantors or Foreign Loan Guarantors, as the case may be, to make due and
punctual payment of any of the U.S. Guaranteed Obligations or Foreign
Guaranteed Obligations, as the case may be, or resulting from any of the U.S.
Guaranteed Obligations or Foreign Guaranteed Obligations, as the case may be,
being or becoming void, voidable, unenforceable or ineffective against such
U.S. Loan Guarantors or Foreign Loan Guarantors, as the case may be (including
all legal and other costs, charges and expenses incurred by the Guaranteed
Parties, or any of them, in connection with preserving or enforcing, or
attempting to preserve or enforce, its rights under this Guaranty) and pay on
demand the amount of such costs, losses, expenses and liabilities whether or
not any of the Guaranteed Parties have attempted to enforce any rights against
any other Loan Guarantor or any other Person or otherwise.

 

SECTION 10.10.  Contribution.  (a)  In
the event any U.S. Loan Guarantor (a “U.S. Paying Guarantor”) shall make
any payment or payments under this Loan Guaranty or shall suffer any loss as a
result of any realization upon any collateral granted by it to secure its
obligations under this Loan Guaranty, each other U.S. Loan Guarantor (each a “U.S.
Non-Paying Guarantor”) shall contribute to such U.S. Paying Guarantor an
amount equal to such U.S. Non-Paying Guarantor’s Domestic Applicable Percentage
(as defined below) of such payment or payments made, or losses suffered, by
such U.S. Paying Guarantor.  For purposes
of this paragraph (a) of this Section 10.10, each U.S. Non-Paying
Guarantor’s “Domestic Applicable Percentage” with respect to any such
payment or loss by a U.S. Paying Guarantor shall be determined as of the date
on which such payment or loss was made by reference to the ratio of (i) such
U.S. Non-Paying Guarantor’s Maximum Liability as of such date (without giving
effect to any right to receive, or obligation to make, any contribution
hereunder) or, if such U.S. Non-Paying Guarantor’s Maximum Liability has not
been determined, the aggregate amount of all monies received by such U.S.
Non-Paying Guarantor from the Parent Borrower after the date hereof (whether by
loan, capital infusion or by other means) to (ii) the aggregate Maximum
Liability of all U.S. Loan Guarantors hereunder (including such U.S. Paying
Guarantor) as of such date (without giving effect to any right to receive, or
obligation to make, any contribution hereunder), or to the extent that a
Maximum Liability has not been determined for any U.S. Loan Guarantor, the
aggregate amount of all monies received by such

 

135

 

U.S. Loan
Guarantors from the Parent Borrower after the date hereof (whether by loan,
capital infusion or by other means). 
Nothing in this provision shall affect any U.S. Loan Guarantor’s several
liability for the entire amount of the U.S. Guaranteed Obligations (up to such
U.S. Loan Guarantor’s Maximum Liability).

 

(b)  In
the event any Foreign Loan Guarantor (a “Foreign Paying Guarantor”)
shall make any payment or payments under this Loan Guaranty or shall suffer any
loss as a result of any realization upon any collateral granted by it to secure
its obligations under this Loan Guaranty, each other Foreign Loan Guarantor
(each a “Foreign Non-Paying Guarantor” and, collectively together with
the Domestic Non-Paying Guarantors, the “Non-Paying Guarantors”) shall
contribute to such Foreign Paying Guarantor an amount equal to such Foreign
Non-Paying Guarantor’s Foreign Applicable Percentage (as defined below) of such
payment or payments made, or losses suffered, by such Foreign Paying Guarantor.  For purposes of this paragraph (b) of
this Section 10.10, each Foreign Non-Paying Guarantor’s “Foreign
Applicable Percentage” with respect to any such payment or loss by a
Foreign Paying Guarantor shall be determined as of the date on which such
payment or loss was made by reference to the ratio of (i) such Foreign
Non-Paying Guarantor’s Maximum Liability as of such date (without giving effect
to any right to receive, or obligation to make, any contribution hereunder) or,
if such Foreign Non-Paying Guarantor’s Maximum Liability has not been
determined, the aggregate amount of all monies received by such Foreign
Non-Paying Guarantor from the Canadian Subsidiary Borrower after the date
hereof (whether by loan, capital infusion or by other means) to (ii) the
aggregate Maximum Liability of all Foreign Loan Guarantors hereunder (including
such Foreign Paying Guarantor) as of such date (without giving effect to any
right to receive, or obligation to make, any contribution hereunder), or to the
extent that a Maximum Liability has not been determined for any Foreign Loan
Guarantor, the aggregate amount of all monies received by such Foreign Loan
Guarantors from the Canadian Subsidiary Borrower after the date hereof (whether
by loan, capital infusion or by other means). 
Nothing in this provision shall affect any Foreign Loan Guarantor’s
several liability for the entire amount of the Foreign Guaranteed Obligations
(up to such Foreign Loan Guarantor’s Maximum Liability).

 

(c)  Each
of the Loan Guarantors covenants and agrees that its right to receive any
contribution under this Loan Guaranty from a Non-Paying Guarantor shall be
subordinate and junior in right of payment to the payment in full in cash of
the Guaranteed Obligations (other than Unliquidated Obligations).  This provision is for the benefit of both the
Administrative Agent, the Issuing Bank, the Lenders and the Loan Guarantors and
may be enforced by any one, or more, or all of them in accordance with the
terms hereof.

 

SECTION 10.11.  Liability Cumulative.  The liability of each Loan Party as a Loan
Guarantor under this Article X is in addition to and shall be cumulative
with all liabilities of each Loan Party to the Administrative Agent, the
Issuing Bank and the Lenders under this Agreement and the other Loan Documents
to which such Loan Party is a party or in respect of any obligations or
liabilities of the other Loan Parties, without any limitation as to amount,
unless the instrument or agreement evidencing or creating such other liability
specifically provides to the contrary.

 

[The remainder of this page is blank.  Signature pages follow.]

 

136

 

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

 

	
   

  	
   

  	
  INDALEX HOLDINGS FINANCE, INC.,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  INDALEX HOLDING CORP., as Parent Borrower,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Name: Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Title: Secretary, Treasurer & Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  INDALEX LIMITED, as Canadian Subsidiary

  Borrower,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Name: Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Title: Secretary, Treasurer & Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  INDALEX INC., as a Subsidiary Loan Party,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Name: Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Title: Secretary, Treasurer & Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  DOLTON ALUMINUM COMPANY, INC., as a

  Subsidiary Loan Party,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Name: Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Title: Secretary, Treasurer & Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  CARADON LEBANON INC., as a Subsidiary Loan

  Party,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Name: Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Title: Secretary, Treasurer & Chief Financial Officer

  

 

137

 

	
   

  	
   

  	
  INDALEX HOLDINGS (B.C.) LTD., as a Subsidiary

  Loan Party,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Name: Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Title: Secretary, Treasurer & Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  6326765 CANADA INC., as a Subsidiary Loan Party,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Name: Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Title: Secretary, Treasurer & Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  NOVAR INC., as a Subsidiary Loan Party,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Name: Patrick Lawlor

  
	
   

  	
   

  	
   

  	
  Title: Secretary, Treasurer & Chief Financial Officer

  

 

138

 

	
   

  	
   

  	
  JPMORGAN CHASE BANK, N.A., individually and as

  Administrative Agent, Issuing Bank and Swingline

  Lender,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Linda Meyer

  
	
   

  	
   

  	
   

  	
  Name: Linda Meyer

  
	
   

  	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  JPMORGAN CHASE BANK, N.A., TORONTO

  BRANCH, as Canadian Lending Office for the

  Administrative Agent, Issuing Bank and Swingline

  Lender,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Muhammad Hasan

  
	
   

  	
   

  	
   

  	
  Name: Muhammad Hasan

  
	
   

  	
   

  	
   

  	
  Title: Vice President

  

 

139

 

	
   

  	
   

  	
  SIGNATURE
  PAGE TO AMENDED AND

  RESTATED CREDIT AGREEMENT DATED AS OF

  MAY       , 2008, AMONG INDALEX HOLDINGS

  FINANCE, INC., INDALEX HOLDING CORP.,

  INDALEX LIMITED, THE SUBSIDIARIES OF

  INDALEX HOLDING CORP. PARTY THERETO,

  THE LENDERS PARTY THERETO, AND

  JPMORGAN CHASE BANK, N.A., AS

  ADMINISTRATIVE AGENT

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name of
  Institution:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The CIT Group/Business Credit, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/
  Jacqueline Piccione

  
	
   

  	
   

  	
   

  	
  Name: Jacqueline
  Piccione

  
	
   

  	
   

  	
   

  	
  Title: AVP

  

 

140

 

	
   

  	
   

  	
  SIGNATURE
  PAGE TO AMENDED AND

  RESTATED CREDIT AGREEMENT DATED AS OF

  THE DAY AND YEAR FIRST ABOVE WRITTEN,

  AMONG INDALEX HOLDINGS FINANCE, INC.,

  INDALEX HOLDING CORP., INDALEX LIMITED,

  THE SUBSIDIARIES OF INDALEX HOLDING

  CORP. PARTY THERETO, THE LENDERS PARTY

  THERETO, AND JPMORGAN CHASE BANK, N.A.,

  AS ADMINISTRATIVE AGENT.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name of
  Institution:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  SUN INDALEX FINANCE, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Michael
  J. McConvery

  
	
   

  	
   

  	
   

  	
  Name: Michael
  J. McConvery

  
	
   

  	
   

  	
   

  	
  Title: Vice
  President

  

 

141

 

	
   

  	
   

  	
  SIGNATURE
  PAGE TO AMENDED AND

  RESTATED CREDIT AGREEMENT DATED AS OF

  MAY       , 2008, AMONG INDALEX HOLDINGS

  FINANCE, INC., INDALEX HOLDING CORP.,

  INDALEX LIMITED, THE SUBSIDIARIES OF

  INDALEX HOLDING CORP. PARTY THERETO,

  THE LENDERS PARTY THERETO, AND

  JPMORGAN CHASE BANK, N.A., AS

  ADMINISTRATIVE AGENT

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name of
  Institution:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Wachovia Capital Finance Corportation (central)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Vicky
  Geist

  
	
   

  	
   

  	
   

  	
  Name: Vicky
  Geist

  
	
   

  	
   

  	
   

  	
  Title: Director

  

 

142

 

	
   

  	
   

  	
  SIGNATURE
  PAGE TO AMENDED AND

  RESTATED CREDIT AGREEMENT DATED AS OF

  MAY       , 2008, AMONG INDALEX HOLDINGS

  FINANCE, INC., INDALEX HOLDING CORP.,

  INDALEX LIMITED, THE SUBSIDIARIES OF

  INDALEX HOLDING CORP. PARTY THERETO,

  THE LENDERS PARTY THERETO, AND

  JPMORGAN CHASE BANK, N.A., AS

  ADMINISTRATIVE AGENT

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name of
  Institution:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  WELLS FARGO FOOTHILL, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Maged
  Ghebrial

  
	
   

  	
   

  	
   

  	
  Name: Maged
  Ghebrial

  
	
   

  	
   

  	
   

  	
  Title: Vice
  President

  

 

143

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