Document:

REVOLVING CREDIT
AGREEMENT 

DATED AS OF OCTOBER
29, 2004 

AMONG 

JOHNSON OUTDOORS INC., 

THE SUBSIDIARY
BORROWERS 

FROM TIME TO TIME
PARTIES HERETO, 

and 

LASALLE BANK NATIONAL
ASSOCIATION 

TABLE OF CONTENTS 

			Page
	
		
	
ARTICLE 1	DEFINITIONS	1 
	
            1.1	Certain Defined Terms	1 
			
	
            1.2	References	18 
			
	
            1.3	Supplemental Disclosure	18 
			
	
ARTICLE 2	THE CREDITS	19 
	
            2.1	Commitment	19 
			
	
            2.2	[Reserved]	19 
			
	
            2.3	Determination of Dollar Amounts; Required Payments; Termination	19 
			
	
            	2.3.1    Determination of Dollar Amounts	19 
			
	
            	2.3.2    Required Payments	19 
			
	
            	2.3.3    Termination	20 
			
	
            2.4	[Reserved]	20 
			
	
            2.5	Types of Advances	20 
			
	
            2.6	Commitment Fee; Reductions in Commitment	20 
			
	
            	2.6.1    Commitment Fee	20 
			
	
            	2.6.2    Reductions in Commitment	20 
			
	
            2.7	Minimum Amount of Each Advance	20 
			
	
            2.8	Principal Payments	20 
			
	
            	2.8.1    Optional Principal Payments	21 
			
	
            	2.8.2    Mandatory Principal Payments	21 
			
	
            2.9	Method of Selecting Types and Interest Periods for New Advances; Method 
	            	of Borrowing; Advances to be Made in euro	21 
			
	
            	2.9.1    Method of Selecting Types and Interest Periods for New Advances	21 
			
	
            	2.9.2    Method of Borrowing	22 
			
	
            	2.9.3    Advances to be Made in euro	22 
			
	
            2.10	Conversion and Continuation of Outstanding Advances	22 
			
	
            2.11	Changes in Interest Rate, etc	23 
			
	
            2.12	No Conversion or Continuation of Eurocurrency Advances After Default; 
	            	Rates Applicable After Default	23 
			
	
            2.13	Method of Payment	23 
			
	
            2.14	Noteless Agreement; Evidence of Indebtedness	24 
			

i 

TABLE OF CONTENTS
(Continued) 

			Page
	
		
	
            2.15	Telephonic Notices	25 
			
	
            2.16	Interest Payment Dates; Interest and Fee Basis	25 
			
	
            2.17	[Reserved]	25 
			
	
            2.18	Lending Installations	25 
			
	
            2.19	[Reserved]	25 
			
	
            2.20	[Reserved]	26 
			
	
            2.21	Facility LCs	26 
			
	
            	2.21.1    Issuance; Transitional Facility LCs	26 
			
	
            	2.21.2    [Reserved]	26 
			
	
            	2.21.3    Notice	26 
			
	
            	2.21.4    LC Fees	26 
			
	
            	2.21.5    Administration	27 
			
	
            	2.21.6    Reimbursement by the Borrowers	27 
			
	
            	2.21.7    Obligations Absolute	28 
			
	
            	2.21.8    Actions of LC Issuer	28 
			
	
            	2.21.9    Indemnification	28 
			
	
            	2.21.10    [Reserved]	29 
			
	
            	2.21.11    Facility LC Collateral Account	29 
			
	
            2.22	Subsidiary Borrowers	29 
			
	
            2.23	Judgment Currency	29 
			
	
ARTICLE 3	YIELD PROTECTION; TAXES	30 
	
            3.1	Yield Protection	30 
			
	
            3.2	Changes in Capital Adequacy Regulations	31 
			
	
            3.3	Availability of Types of Advances	31 
			
	
            3.4	Funding Indemnification	32 
			
	
            3.5	Taxes	32 
			
	
            3.6	Lender Statements; Survival of Indemnity	32 
			
	
ARTICLE 4	CONDITIONS PRECEDENT	33 
	
            4.1	Initial Credit Extension	33 
			
	
            4.2	Each Credit Extension	34 
			
	
            4.3	Initial Advance to Each New Subsidiary Borrower	35 
			

ii 

TABLE OF CONTENTS
(Continued) 

			Page
	
		
	
ARTICLE 5	REPRESENTATIONS AND WARRANTIES	35 
	
            5.1	Existence and Standing	35 
			
	
            5.2	Authorization and Validity	36 
			
	
            5.3	No Conflict; Government Consent	36 
			
	
            5.4	Financial Statements	36 
			
	
            5.5	Material Adverse Change	36 
			
	
            5.6	Taxes	37 
			
	
            5.7	Litigation and Contingent Obligations	37 
			
	
            5.8	Subsidiaries	37 
			
	
            5.9	Accuracy of Information	37 
			
	
            5.10	Regulation U	37 
			
	
            5.11	Material Agreements	37 
			
	
            5.12	Compliance With Laws	38 
			
	
            5.13	Ownership of Properties	38 
			
	
            5.14	ERISA; Foreign Pension Matters	38 
			
	
            5.15	Plan Assets; Prohibited Transactions	39 
			
	
            5.16	Environmental Matters	39 
			
	
            5.17	Investment Company Act	39 
			
	
            5.18	Public Utility Holding Company Act	39 
			
	
            5.19	Insurance	39 
			
	
ARTICLE 6	COVENANTS	39 
	
            6.1	Reporting	40 
			
	
            6.2	Use of Proceeds	42 
			
	
            6.3	Notice of Default	42 
			
	
            6.4	Conduct of Business	42 
			
	
            6.5	Taxes	43 
			
	
            6.6	Insurance	43 
			
	
            6.7	Compliance with Laws; Maintenance of Plans	43 
			
	
            6.8	Maintenance of Properties	43 
			
	
            6.9	Inspection; Keeping of Books and Records	43 
			
	
            6.10	Addition of Guarantors	43 
			

iii 

TABLE OF CONTENTS
(Continued) 

			Page
	
		
	
            6.11	Dividends and Distributions	44 
			
	
            6.12	Indebtedness	44 
			
	
            6.13	Merger	45 
			
	
            6.14	Sale of Assets	45 
			
	
            6.15	Investments and Acquisitions	46 
			
	
            6.16	Liens	48 
			
	
            6.17	Transactions with Affiliates	48 
			
	
            6.18	Financial Contracts	49 
			
	
            6.19	ERISA	49 
			
	
            6.20	Environmental Compliance	49 
			
	
            6.21	Financial Covenants	49 
			
	
            	6.21.1    Maximum Leverage Ratio	49 
			
	
            	6.21.2    Minimum Fixed Charge Coverage Ratio	50 
			
	
            	6.21.3    Minimum Consolidated Net Worth	50 
			
	
ARTICLE 7	DEFAULTS	50 
	
            7.1	Breach of Representations or Warranties	50 
			
	
            7.2	Failure to Make Payments When Due	50 
			
	
            7.3	Breach of Covenants	50 
			
	
            7.4	Other Breaches	50 
			
	
            7.5	Default as to Other Indebtedness	51 
			
	
            7.6	Voluntary Bankruptcy; Appointment of Receiver; Etc	51 
			
	
            7.7	Involuntary Bankruptcy; Appointment of Receiver; Etc	51 
			
	
            7.8	Custody or Control of Property	51 
			
	
            7.9	Judgments	52 
			
	
            7.10	ERISA Liabilities	52 
			
	
            7.11	Environmental Matters	52 
			
	
            7.12	Change in Control	52 
			
	
            7.13	Guarantor Revocation	52 
			
	
ARTICLE 8	ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES	52 
			
	
            8.1	Acceleration	53 
			
	
            8.2	Amendments	54 
			

iv 

TABLE OF CONTENTS
(Continued) 

			Page
	
		
	
            8.3	Preservation of Rights	54 
			
	
ARTICLE 9	GUARANTY	54 
			
	
            9.1	Guarantee of Obligations	54 
			
	
            	9.1.1    Company Guaranty	54 
			
	
            	9.1.2    Performance by Company	54 
			
	
            	9.1.3    Nature of Guaranty	55 
			
	
            	9.1.4    Waivers and Other Agreements	55 
			
	
            	9.1.5    Obligations Absolute	55 
			
	
            9.2	No Investigation by Lenders or Administrative Agent	56 
			
	
            9.3	Indemnity	56 
			
	
            9.4	Reinstatement	56 
			
	
ARTICLE 10	GENERAL PROVISIONS	56 
	
            10.1	Survival of Representations	56 
			
	
            10.2	Governmental Regulation	56 
			
	
            10.3	Headings	57 
			
	
            10.4	Entire Agreement	57 
			
	
            10.5	Benefits of this Agreement	57 
			
	
            10.6	Expenses; Indemnification	57 
			
	
            10.7	[Reserved]	57 
			
	
            10.8	Accounting	57 
			
	
            10.9	Severability of Provisions	58 
			
	
            10.10	Nonliability of Lenders	58 
			
	
            10.11	Confidentiality	58 
			
	
            10.12	Lender Not Utilizing Plan Assets	59 
			
	
            10.13	Nonreliance	59 
			
	
            10.14	Disclosure	59 
			
	
            10.15	Subordination of Intercompany Indebtedness	59 
			
	
ARTICLE 11	[reserved]	60 
			
	
ARTICLE 12	SETOFF	60 
			
	
            12.1	Setoff	60 
			

v 

TABLE OF CONTENTS
(Continued) 

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ARTICLE 13	BENEFIT OF AGREEMENT; PARTICIPATIONS	60 
			
	
            13.1	Successors and Assigns	60 
			
	
            13.2	Participations	60 
			
	
            	13.2.1    Permitted Participants; Effect	60 
			
	
            	13.2.2    Voting Rights	61 
			
	
            	13.2.3    Benefit of Setoff	61 
			
	
            13.3	Dissemination of Information	61 
			
	
ARTICLE 14	NOTICES	61 
	
            14.1	Notices	61 
			
	
            14.2	Change of Address	62 
			
	
ARTICLE 15	COUNTERPARTS	62 
			
	
ARTICLE 16	CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL	62 
			
	
            16.1	CHOICE OF LAW	62 
			
	
            16.2	CONSENT TO JURISDICTION	62 
			
	
            16.3	WAIVER OF JURY TRIAL	63 
			
	
ARTICLE 17	TERMINATION OF EXISTING CREDIT AGREEMENT	63 

vi 

Exhibits  

Exhibit A Form of Borrowers’ Counsel’s
Opinion 

Exhibit B Form of Compliance
Certificate 

Exhibit C Form of Loan/Credit
Related Money Transfer Instruction 

Exhibit D Form of Promissory Note 

Exhibit E List of Closing
Documents 

Exhibit F Form of Guaranty 

Exhibit G Form of Assumption
Letter 

Schedules  

Pricing Schedule 

Commitment Schedule 

Eurocurrency Payment Office
Schedule 

Schedule 1.1 Subsidiary Borrowers 

Schedule 5.4 Financial Statements 

Schedule 5.7 Litigation 

Schedule 5.8 Subsidiaries 

Schedule 5.14 ERISA Matters 

Schedule 5.16 Environmental
Matters 

Schedule 6.12 Existing
Indebtedness 

Schedule 6.15 Existing Investments 

Schedule 6.16 Existing Liens 

vii 

REVOLVING CREDIT
AGREEMENT  

        This
Revolving Credit Agreement, dated as of October 29, 2004, is among JOHNSON OUTDOORS
INC., one or more other Subsidiary Borrowers from time to time parties hereto (whether
now existing or hereafter formed), and LASALLE BANK NATIONAL ASSOCIATION, a national
banking association having its principal office in Chicago, Illinois. The parties hereto
agree as follows:  

ARTICLE 1  

DEFINITIONS  

        1.1     
Certain Defined Terms. As used in this Agreement:  

        “Accounting
Changes” is defined in Section 10.8 hereof.  

        “Acquisition”means
any transaction, or any series of related transactions, consummated on or after the date
of this Agreement, by which the Company or any of its Subsidiaries (i) acquires any going
business or all or substantially all of the assets of any firm, corporation or limited
liability company, or division thereof, whether through purchase of assets, merger or
otherwise or (ii) directly or indirectly acquires (in one transaction or as the most
recent transaction in a series of transactions) at least a majority (in number of votes)
of the securities of a corporation which have ordinary voting power for the election of
directors (other than securities having such power only by reason of the happening of a
contingency) or a majority (by percentage of voting power) of the outstanding ownership
interests of a partnership or limited liability company.  

        “Advance”means
a borrowing hereunder consisting of the aggregate amount of several Loans (i) made by the
Lender on the same Borrowing Date, or (ii) converted or continued by the Lender on the
same date of conversion or continuation, consisting, in either case, of the aggregate
amount of the several Loans of the same Type and, in the case of Eurocurrency Loans, in
the same Agreed Currency and for the same Interest Period.  

        “Affiliate”of
any Person means any other Person directly or indirectly controlling, controlled by or
under common control with such Person. A Person shall be deemed to control another Person
if the controlling Person is the “beneficial owner” (as defined in Rule 13d-3
under the Securities Exchange Act of 1934) of five percent (5%) or more of any class of
voting securities (or other voting interests) of the controlled Person or possesses,
directly or indirectly, the power to direct or cause the direction of the management or
policies of the controlled Person, whether through ownership of voting securities, by
contract or otherwise.  

        “Agreed
Currencies” means (i) Dollars, (ii) so long as such currencies remain Eligible
Currencies, Australian Dollars, British Pounds Sterling, Canadian Dollars, German
Deutsche Marks, Dutch Guilders, French Francs, Swiss Francs, Japanese Yen, and, from and
after becoming generally available in the international currency and exchange markets,
the euro, and (iii) any other Eligible Currency which the applicable Borrower requests
the Lender to include as an Agreed Currency hereunder and which is acceptable to the
Lender. For the purposes of this definition, each of the specific currencies referred to
in clause (ii), above, shall mean and be deemed to refer to the lawful currency of the
jurisdiction referred to in connection with such currency, e.g., “Australian Dollars” means
the lawful currency of Australia.  

1 

        “Agreement”means
this Revolving Credit Agreement, as it may be amended, restated, supplemented or
otherwise modified and as in effect from time to time.  

        “Agreement
Accounting Principles” means generally accepted accounting principles as in
effect in the United States from time to time, applied in a manner consistent with that
used in preparing the financial statements of the Company referred to in Section 5.4;
provided, however, that except as provided in Section 10.8, with respect to the
calculation of financial ratios and other financial tests required by this Agreement,
“Agreement Accounting Principles” means generally accepted accounting
principles as in effect in the United States as of the date of this Agreement, applied in
a manner consistent with that used in preparing the financial statements of the Company
referred to in Section 5.4 hereof.  

        “Alternate
Base Rate” means, for any day, a fluctuating rate of interest per annum equal to
the higher of (i) the Prime Rate for such day and the sum of (a) the Federal Funds
Effective Rate for such day and (b) one-half of one percent (0.5%) per annum.  

        “Applicable
Commitment Fee Rate” means, at any time, the percentage rate per annum at which
Commitment Fees are accruing on the unused portion of the Commitment at such time as set
forth in the Pricing Schedule.  

        “Applicable
Margin” means, with respect to Eurocurrency Advances at any time, the percentage
rate per annum which is applicable at such time with respect to Eurocurrency Advances as
set forth in the Pricing Schedule.  

        “Applicable
Performance LC Fee” means, with respect to Performance LCs at any time, the
percentage rate per annum which is applicable at such time with respect to Performance
LCs as set forth in the Pricing Schedule.  

        “Approximate
Equivalent Amount” of any currency with respect to any amount of Dollars shall
mean the Equivalent Amount of such currency with respect to such amount of Dollars on or
as of such date, rounded up to the nearest whole unit of such currency as determined by
the Lender from time to time.  

        “Article”means
an article of this Agreement unless another document is specifically referenced.  

        “Assumption
Letter” means a letter of a Subsidiary of the Company addressed to the Lender,
and acknowledged by the Lender, in substantially the form of Exhibit G hereto,
pursuant to which such Subsidiary agrees to become a “Subsidiary Borrower” and
agrees to be bound by the terms and conditions hereof.  

        “Authorized
Officer” means any of the chief executive officer, president, chief operating
officer, chief financial officer, chief accounting officer or treasurer of the Company,
acting singly.  

2 

        “Available
Commitment” means, at any time, the Commitment then in effect minus the
Outstanding Credit Exposure at such time.  

        “Benefit
Plan” shall mean a defined benefit plan as defined in Section 3(35) of ERISA
(other than a Multiemployer Plan) in respect of which the Company or any ERISA Affiliate
is, or within the immediately preceding six (6) years was, an “employer” as
defined in Section 3(5) of ERISA.  

        “Borrower”means,
as applicable, any of the Company or any of the Subsidiary Borrowers, together with their
respective permitted successors and assigns, and “Borrowers” means,
collectively, the Company and the Subsidiary Borrowers.  

        “Borrowing
Date” means a date on which an Advance is made hereunder.  

        “Borrowing
Notice”is defined in Section 2.9.1.  

        “Business
Day” means (i) with respect to any borrowing, payment or rate selection of
Eurocurrency Advances, a day (other than a Saturday or Sunday) on which banks generally
are open in Chicago, Illinois for the conduct of substantially all of their commercial
lending activities, interbank wire transfers can be made on the Fedwire system and
dealings in Dollars and the other Agreed Currencies are carried on in the London
interbank market (and, if the Advances which are the subject of such borrowing, payment
or rate selection are denominated in euro, a day upon which such clearing system as is
determined by the Lender to be suitable for clearing or settlement of the euro is open
for business) and (ii) for all other purposes, a day (other than a Saturday or Sunday) on
which banks generally are open in Chicago, Illinois for the conduct of substantially all
of their commercial lending activities and interbank wire transfers can be made on the
Fedwire system.  

        “Capitalized
Lease” of a Person means any lease of Property by such Person as lessee which
would be capitalized on a balance sheet of such Person prepared in accordance with
Agreement Accounting Principles.  

        “Capitalized
Lease Obligations” of a Person means the amount of the obligations of such
Person under Capitalized Leases which would be shown as a liability on a balance sheet of
such Person prepared in accordance with Agreement Accounting Principles.  

        “Capital
Stock” means (i) in the case of a corporation, corporate stock, (ii) in the case
of an association or business entity, any and all shares, interests, participations,
rights or other equivalents (however designated) of corporate stock, (iii) in the case of
a partnership, partnership interests (whether general or limited) and (iv) any other
interest or participation that confers on a Person the right to receive a share of the
profits and losses of, or distributions of assets of, the issuing Person.  

        “Cash
Equivalent Investments” means, as to any Person, (i) securities issued or
directly and fully guaranteed or insured by the United States or any agency or
instrumentality thereof (provided that the full faith and credit of the United States is
pledged in support thereof) having maturities of not more than one year from the date of
acquisition, (ii) time deposits and certificates of deposit of any investment grade
commercial bank having, or which is the principal banking subsidiary of an investment
grade bank holding company organized under the laws of the United States, any State
thereof, the District of Columbia or any foreign jurisdiction having capital, surplus and
undivided profits aggregating in excess of $500,000,000, with maturities of not more than
one year from the date of acquisition by such Person, (iii) repurchase obligations with a
term of not more than ninety (90) days for underlying securities of the types described
in clause (i) above entered into with any bank meeting the qualifications specified in
clause (ii) above, provided that such repurchase obligations are secured by a first
priority security interest in such underlying securities which have, on the date of
purchase thereof, a fair market value of at least 100% of the amount of the repurchase
obligations, (iv) commercial paper issued by any Person incorporated in the United States
rated at least A-1 by S&P or P-1 by Moody’s and in each case maturing not more
than 270 days after the date of acquisition by such Person, (v) investments in money
market funds substantially all of the assets of which are comprised of securities of the
types described in clauses (i) through (iv) above, and (vi) demand deposit accounts
maintained in the ordinary course of business.  

3 

        “Change”is
defined in Section 3.2. 

        “Change
in Control” means (i) the Johnson Family shall at any time fail to own stock
having, in the aggregate, votes sufficient to elect at least a fifty-one percent (51%)
majority of the Board of Directors of the Company, (ii) the acquisition by any Person, or
two or more Persons acting in concert, of beneficial ownership (within the meaning of
Rule 13d-3 of the Securities and Exchange Commission under the Securities Exchange Act of
1934), directly or indirectly, of thirty percent (30%) or more of the outstanding shares
of voting stock of the Company; or (iii) the majority of the Board of Directors of the
Company fails to consist of Continuing Directors; or (iv) except as expressly permitted
under the terms of this Agreement, the Company consolidates with or merges into another
Person or conveys, transfers or leases all or substantially all of its property to any
Person, or any Person consolidates with or merges into the Company, in either event
pursuant to a transaction in which the outstanding Capital Stock of the Company is
reclassified or changed into or exchanged for cash, securities or other property; or (v)
except as otherwise expressly permitted under the terms of this Agreement, the Company
shall cease to own and control, directly or indirectly, all of the economic and voting
rights associated with all of the outstanding Capital Stock of each of the Company’s
Subsidiaries or shall cease to have the power, directly or indirectly, to elect all of
the members of the board of directors of each of the Company’s Subsidiaries.  

        “Closing
Date” means October 29, 2004. 

        “Collateral
Shortfall Amount” is defined in Section 8.1.  

        “Commitment”means
the obligation of the Lender to make Revolving Loans to a Borrower in an aggregate amount
not exceeding the amount set forth on the Commitment Schedule, as such amount may be
modified from time to time pursuant to the terms hereof.  

        “Commitment
Fee” is defined in Section 2.6.1.  

        “Commitment
Schedule”means the Schedule identifying the Lender’s Commitment as of the
Closing Date attached hereto and identified as such.  

4 

        “Company”means
Johnson Outdoors Inc., a Wisconsin corporation, and its permitted successors and assigns
(including, without limitation, a debtor-in-possession on its behalf).  

        “Computation
Date” is defined in Section 2.3.  

        “Consolidated
Net Income”means, with reference to any period, the net after-tax income (or
loss) of the Company and its Subsidiaries calculated on a consolidated basis for such
period determined in accordance with Agreement Accounting Principles.  

        “Consolidated
Net Worth” means, as of the date of any determination thereof, the amount of the
par or stated value of all outstanding capital stock, capital surplus and retained
earnings of the Company and its Subsidiaries, net of all cumulative translation
adjustments and contingent compensation adjustments determined on a consolidated basis in
accordance with Agreement Accounting Principles.  

        “Consolidated
Tangible Assets” means the Consolidated Total Assets of the Company, excluding
all items that are treated as intangibles under Agreement Accounting Principles.  

        “Consolidated
Tangible Net Worth” means the consolidated stockholders’ equity of the
Company and its Subsidiaries minus, to the extent included as assets in determining
Consolidated Net Worth, the net book value of all (i) goodwill, including, without
limitation, the excess of cost over book value of any asset, (ii) organization or
experimental expenses, (iii) unamortized debt discount and expense, (iv) patents,
trademarks, trade names and copyrights, (v) treasury stock, (vi) franchises, licenses and
permits, and (vii) other assets which are deemed intangible assets under Agreement
Accounting Principles.  

        “Consolidated
Total Assets” means the total amount of all assets of the Company and its
consolidated Subsidiaries, and including amounts attributable to minority interests in
Affiliates of the Company to the extent deducted in calculating the Consolidated Total
Assets of the Company and its Subsidiaries but only to the extent such Affiliate shall be
a Guarantor hereunder, calculated on a consolidated basis as of such time in accordance
with Agreement Accounting Principles.  

        “Continuing
Director” means, with respect to any Person as of any date of determination, any
member of the board of directors of such Person who (a) was a member of such board of
directors on the Closing Date, or (b) was nominated for election or elected to such board
of directors with the approval of the required majority of the Continuing Directors who
were members of such board at the time of such nomination or election; provided that any
individual who is so elected or nominated in connection with a merger, consolidation,
acquisition or similar transaction shall not be a Continuing Director unless such
individual was a Continuing Director prior thereto.  

        “Contractual
Obligation” of any Person shall mean any provision of any security issued by
such Person or of any agreement, instrument or undertaking under which such Person is
obligated or by which it or any of the property owned by it is bound.  

        “Conversion/Continuation
Notice” is defined in Section 2.10.  

5 

        “Credit
Extension” means the making of an Advance or the issuance of a Facility LC
hereunder.  

        “Credit
Extension Date” means the Borrowing Date for an Advance or the issuance date for
a Facility LC.  

        “Default”means
an event described in Article VII.  

        “Disqualified
Stock” means any Capital Stock that, by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or redeemable at the option of the holder thereof, in whole or
in part, on or prior to the date that is ninety-one (91) days after the Facility
Termination Date.  

        “DOL”shall
mean the United States Department of Labor and any successor department or agency.  

        “Dollar
Amount” of any currency at any date shall mean (i) the amount of such currency
if such currency is Dollars or (ii) the equivalent in such currency of such amount of
Dollars if such currency is any currency other than Dollars, calculated on the basis of
the arithmetical mean of the buy and sell spot rates of exchange of the Lender for such
currency on the London market at 11:00 a.m., London time, on or as of the most recent
Computation Date provided for in Section 2.3.  

        “Dollars”and
“$”shall mean the lawful currency of the United States of America.  

        “Domestic
Subsidiary” means a Subsidiary of the Company organized under the laws of a
jurisdiction located in the United States of America.  

        “EBITDA”shall
mean, for any period for the Company and its consolidated Subsidiaries, the sum of the
amounts for such period, without duplication, calculated in each case in accordance with
Agreement Accounting Principles, of (i) Net Income, plus (ii) Interest Expense to the
extent deducted in computing Net Income, plus (iii) charges against income for foreign,
federal, state and local taxes to the extent deducted in computing Net Income, plus (iv)
depreciation expense to the extent deducted in computing Net Income, plus (v)
amortization expense, including, without limitation, amortization of goodwill and other
intangible assets to the extent deducted in computing Net Income, plus (vi) any other
non-recurring charges to the extent deducted in computing Net Income, minus (vii) any
non-recurring credits to the extent added in computing Net Income, plus (viii)
non-recurring after-tax losses (or minus non-recurring after-tax gains); provided, that
the aggregate adjustment pursuant to clauses (vi) through (viii) of this definition shall
not exceed $2,000,000 for the four-quarter period ending on such date (exclusive of any
such adjustments for the closing of the Escape Sailboats operation in Portsmouth, Rhode
Island and the closing of certain of the Necky Kayak operations located in Abbotsfort,
British Columbia (collectively, the “Identified Plants”) in an aggregate amount
not to exceed $2,500,000).  

        “Eligible
Currency” means any currency other than Dollars (i) that is readily available,
(ii) that is freely traded, (iii) in which deposits are customarily offered to banks in
the London interbank market, (iv) which is convertible into Dollars in the international
interbank market and (v) as to which an Equivalent Amount may be readily calculated. If,
after the designation by the Lender of any currency as an Agreed Currency, (x) currency
control or other exchange regulations are imposed in the country in which such currency
is issued with the result that different types of such currency are introduced, (y) such
currency is, in the determination of the Lender, no longer readily available or freely
traded or (z) in the determination of the Lender, an Equivalent Amount of such currency
is not readily calculable, the Lender shall promptly notify the Borrowers, and such
currency shall no longer be an Agreed Currency until such time as the Lender agrees to
reinstate such currency as an Agreed Currency and promptly, but in any event within five
Business Days of receipt of such notice from the Lender, the Borrowers shall repay all
Loans in such affected currency or convert such Loans into Loans in Dollars or another
Agreed Currency, subject to the other terms set forth in Article II.  

6 

        “Environmental
Laws” means any and all federal, state, local and foreign statutes, laws,
judicial decisions, regulations, ordinances, rules, judgments, orders, decrees, plans,
injunctions, permits, concessions, grants, franchises, licenses, agreements and other
governmental restrictions relating to (i) the protection of the environment, (ii) the
effect of the environment on human health, (iii) emissions, discharges or releases of
pollutants, contaminants, hazardous substances or wastes into surface water, ground water
or land, or (iv) the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of pollutants, contaminants, hazardous substances or
wastes or the clean-up or other remediation thereof.  

        “Equivalent
Amount” of any currency with respect to any amount of Dollars at any date shall
mean the equivalent in such currency of such amount of Dollars, calculated on the basis
of the arithmetical mean of the buy and sell spot rates of exchange of the Lender for
such other currency at 11:00 a.m., London time, on the date on or as of which such amount
is to be determined.  

        “ERISA”means
the Employee Retirement Income Security Act of 1974, as amended from time to time,
including (unless the context otherwise requires) any rules or regulations promulgated
thereunder.  

        “ERISA
Affiliate” shall mean any (i) corporation which is a member of the same
controlled group of corporations (within the meaning of Section 414(b) of the IRC) as the
Company, (ii) partnership or other trade or business (whether or not incorporated) under
common control (within the meaning of Section 414(c) of the IRC) with the Company, and
(iii) member of the same affiliated service group (within the meaning of Section 414(m)
of the IRC) as the Company, any corporation described in clause (i) above or any
partnership or trade or business described in clause (ii) above.  

        “Euro”and/or
“EUR” means the euro referred to in Council Regulation (EC) No. 1103/97
dated June 17, 1997 passed by the Council of the European Union, or, if different, the
then lawful currency of the member states of the European Union that participate in the
third stage of Economic and Monetary Union.  

        “Eurocurrency” means
any Agreed Currency. 

7 

        “Eurocurrency
Advance” means an Advance which, except as otherwise provided in Section 2.12,
bears interest at a Eurocurrency Rate requested by a Borrower pursuant to Sections 2.9 and
2.10.  

        “Eurocurrency
Loan” means a Loan which, except as otherwise provided in Section 2.12,
bears interest at a Eurocurrency Rate requested by a Borrower pursuant to Sections 2.9 and
2.10.  

        “Eurocurrency
Payment Office” of the Lender shall mean, for each of the Agreed Currencies, the
office, branch, affiliate or correspondent bank of the Lender specified as the “Eurocurrency
Payment Office” for such currency on the Eurocurrency Payment Office Schedule hereto
or such other office, branch, affiliate or correspondent bank of the Lender as it may
from time to time specify to the Borrowers as its Eurocurrency Payment Office.  

        “Eurocurrency
Payment Office Schedule” means the Schedule identifying the Eurocurrency Payment
Office of the Lender for each of the Agreed Currencies attached hereto identified as
such.  

        “Eurocurrency
Rate” means, with respect to a Eurocurrency Advance for the relevant Interest
Period, the sum of (i) the quotient of (a) the Eurocurrency Reference Rate applicable to
such Interest Period, divided by (b) one minus the Reserve Requirement (expressed as a
decimal) applicable to such Interest Period, plus (ii) the then Applicable Margin,
changing as and when the Applicable Margin changes.  

        “Eurocurrency
Reference Rate” means, with respect to a Eurocurrency Advance for the relevant
Interest Period, the applicable British Bankers’ Association Interest Settlement
Rate for deposits in the applicable Agreed Currency appearing on Reuters Screen FRBD or
the applicable Reuters Screen for such Agreed Currency as of 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period, and having a maturity equal
to such Interest Period, provided that, (i) if Reuters Screen FRBD or the applicable
Reuters Screen for such Agreed Currency is not available to the Lender for any reason,
the applicable Eurocurrency Reference Rate for the relevant Interest Period shall instead
be the applicable British Bankers’ Association Interest Settlement Rate for deposits
in the Applicable Agreed Currency as reported by any other generally recognized financial
information service as of 11:00 a.m. (London time) two Business Days prior to the first
day of such Interest Period, and having a maturity equal to such Interest Period, and
(ii) if no such British Bankers’ Association Interest Settlement Rate is available,
the applicable Eurocurrency Reference Rate for the relevant Interest Period shall instead
be the rate determined by the Lender to be the rate at which it offers to place deposits
in the applicable Agreed Currency with first-class banks in the London interbank market
at approximately 11:00 a.m. (London time) two Business Days prior to the first day of
such Interest Period, in the approximate amount of the Lender’s relevant
Eurocurrency Loan and having a maturity equal to such Interest Period.  

        “Excluded
Taxes” means, in the case of the Lender or applicable Lending Installation and
the Lender, taxes imposed on its overall net income, and franchise taxes imposed on it,
by (i) the jurisdiction under the laws of which the Lender is incorporated or organized
or any political combination or subdivision or taxing authority thereof or (ii) the
jurisdiction in which the Lender’s principal executive office or the Lender’s
applicable Lending Installation is located or in which, other than as a result of the
transaction evidenced by this Agreement, the Lender otherwise is, or at any time was,
engaged in business.  

8 

        “Exhibit”refers
to an exhibit to this Agreement, unless another document is specifically referenced.  

        “Existing
Credit Agreement” means that certain 3-Year Revolving Credit Agreement dated as
of August 31, 2001 among the Company, the subsidiary borrowers parties thereto, the
lenders parties thereto, and Bank One, NA, as Administrative Agent, as the same has been
amended, restated, supplemented or otherwise modified from time to time.  

        “Facility
LC” is defined in Section 2.21.1.  

        “Facility
LC Application” is defined in Section 2.21.3.  

        “Facility
LC Collateral Account” is defined in Section 2.21.11.  

        “Facility
Termination Date” means the earlier of (a) October 28, 2005, and (b) the date of
termination in whole of the Commitment pursuant to Sections 2.6 or 8.1 hereof.  

        “Federal
Funds Effective Rate” means, for any day, an interest rate per annum equal to
the weighted average of the rates on overnight Federal funds transactions with members of
the Federal Reserve System arranged by Federal funds brokers on such day, as published
for such day (or, if such day is not a Business Day, for the immediately preceding
Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day which is a Business Day, the average of the quotations at
approximately 10:00 a.m. (Chicago time) on such day on such transactions received by the
Lender from three Federal funds brokers of recognized standing selected by the Lender in
its sole discretion.  

        “Financial
Contract” of a Person means (i) any exchange-traded or over-the-counter futures,
forward, swap or option contract or other financial instrument with similar
characteristics or (ii) any agreements, devices or arrangements providing for payments
related to fluctuations of interest rates, exchange rates, forward rates or commodity
prices, including, but not limited to, interest rate swap or exchange agreements, forward
currency exchange agreements, interest rate cap or collar protection agreements, forward
rate currency, interest rate options puts or warrants.  

        “Fixed
Charge Coverage Ratio” is defined in Section 6.21.2.  

        “Floating
Rate” means, for any day, a rate per annum equal to the Alternate Base Rate for
such day, changing when and as the Alternate Base Rate changes.  

        “Floating
Rate Advance” means an Advance which, except as otherwise provided in Section
2.12, bears interest at the Floating Rate.  

        “Floating
Rate Loan” means a Loan or portion thereof, which, except as otherwise provided
in Section 2.12, bears interest at the Floating Rate.  

9 

        “Foreign
Pension Plan” means any employee benefit plan as described in Section 3(3) of
ERISA for which the Company or any member of its Controlled Group is a sponsor or
administrator and which (i) is maintained or contributed to for the benefit of employees
of the Company, any of its respective Subsidiaries or any member of its Controlled Group,
(ii) is not covered by ERISA pursuant to Section 4(b)(4) of ERISA, and (iii) under
applicable local law, is required to be funded through a trust or other funding vehicle.  

        “Foreign
Subsidiary” means a Subsidiary of the Company which is not a Domestic
Subsidiary.  

        “Funded
Debt”of any Person shall mean, without duplication (a) all Indebtedness for or
in respect of borrowed money or which has been incurred in connection with the
acquisition of property or assets, in each case having a final maturity of more than one
year from the date of origin thereof (or which is renewable or extendible at the option
of the obligor for a period or periods more than one year from the date of origin),
including all payments in respect thereof that are required to be made within one year
from the date of any determination of Funded Debt, whether or not the obligation to make
such payment shall constitute a current liability of the obligor under Agreement
Accounting Principles; provided that any portion of such obligations incurred in
connection with the acquisition of property or assets specifically including, without
limitation, obligations which have been incurred by such Person in connection with any
sale, transfer or issuance of capital stock in accordance with the terms of this
Agreement and which are at the date of any determination of Funded Debt contingent as to
amount or as to payment shall not be treated as Funded Debt on such date, (b) all
Capitalized Lease Obligations, (c) all guaranties by such Person of Funded Debt of
others, (d) all obligations of such Person with respect to receivables sold or otherwise
discounted with recourse, (e) all obligations of such Person in an aggregate amount in
excess of $1,000,000 with respect to all standby letters of credit and (f) all
Disqualified Stock.  

        “Guarantor”shall
mean the Company and each Domestic Subsidiary (other than Uwatec USA, Inc.) as of the
Closing Date and each other Subsidiary that has become a guarantor of the Obligations
hereunder in accordance with the terms of Section 6.10.  

        “Guaranty”means
that certain Guaranty (and any and all supplements thereto) executed from time to time by
each Guarantor (other than the Company) in favor of the Lender, in substantially the form
of Exhibit F attached hereto, as amended, restated, supplemented or otherwise
modified from time to time.  

        “Identified
Plants” is defined in the definition of “EBITDA.” 

        “Indebtedness”of
a Person means, without duplication, (a) the obligations of such Person (i) for borrowed
money or which has been incurred in connection with the acquisition of property or
assets, (ii) under or with respect to notes payable and drafts accepted which represent
extensions of credit (whether or not representing obligations for borrowed money) to such
Person, (iii) constituting reimbursement obligations with respect to letters of credit
issued for the account of such Person or (iv) for the deferred purchase price of property
or services (other than current accounts payable arising in the ordinary course of such
Person’s business payable on terms customary in the trade), (b) the obligations of
others, whether or not assumed, secured by Liens on property of such Person or payable
out of the proceeds of, or production from, property or assets now or hereafter owned or
acquired by such Person, (c) the Capitalized Lease Obligations of such Person, (d) the
obligations of such Person under guaranties by such Person of any Indebtedness (other
than obligations for borrowed money incurred to finance the purchase of property leased
to such Person pursuant to a Capitalized Lease of such Person) of any other Person, (e)
all Off-Balance Sheet Liabilities of such Person, (f) all Disqualified Stock and (g) any
other obligation or other financial accommodation which in accordance with Agreement
Accounting Principles would be shown as a liability on the consolidated balance sheet of
such Person.  

10 

        “Interest
Expense” means, for any period for any group of Persons, the total gross
interest expense of such group of Persons, whether paid or accrued, including, without
duplication, the interest component of Capitalized Leases, commitment and letter of
credit fees, the discount or implied interest component of Off-Balance Sheet Liabilities,
capitalized interest expense, pay-in-kind interest expense, amortization of debt discount
and net payments (if any) pursuant to Financial Contracts relating to interest rate
protection, all as determined in conformity with Agreement Accounting Principles.  

        “Interest
Period” means, with respect to a Eurocurrency Advance, a period of one, two,
three or six months or such other period agreed to by the Lender and the Borrowers,
commencing on a Business Day selected by the applicable Borrower pursuant to this
Agreement. Such Interest Period shall end on but exclude the day which corresponds
numerically to such date one, two, three or six months or such other agreed upon period
thereafter, provided, however, that if there is no such numerically corresponding day in
such next, second, third or sixth succeeding month or such other succeeding period, such
Interest Period shall end on the last Business Day of such next, second, third or sixth
succeeding month or such other succeeding period. If an Interest Period would otherwise
end on a day which is not a Business Day, such Interest Period shall end on the next
succeeding Business Day, provided, however, that if said next succeeding Business Day
falls in a new calendar month, such Interest Period shall end on the immediately
preceding Business Day.  

        “Investment”of
a Person means any loan, advance (other than commission, travel and similar advances to
officers and employees made in the ordinary course of business), extension of credit
(other than accounts receivable arising in the ordinary course of business on terms
customary in the trade, but including accounts receivable from other Persons which are
not current assets or did not arise from sales to such other Person in the ordinary
course of business) or contribution of capital by such Person; stocks, bonds, mutual
funds, partnership interests, notes, debentures or other securities owned by such Person;
any deposit accounts and certificate of deposit owned by such Person; structured notes,
Financial Contracts, derivative financial instruments and other similar instruments or
contracts owned by such Person; any other direct or indirect purchase or acquisition by
such Person of any assets other than assets used in the ordinary course of business; and
any non-arms length transaction by such Person with another Person or any other transfer
of assets by such Person in another Person, with the amount of such Investment being an
amount equal to the net benefit derived by such other Person resulting from any such
transactions.  

11 

        “IRC”shall
mean the Internal Revenue Code of 1986, as amended from time to time, and any successor
statute.  

        “IRS”shall
mean the United States Internal Revenue Service and any successor agency.  

        “Johnson
Family” shall mean at any time, collectively, Mrs. Samuel C. Johnson, and the
children and grandchildren of Mr. and Mrs. Samuel C. Johnson, the executor or
administrator of the estate or other legal representative of any such Person, all trusts
for the benefit of the foregoing or their heirs or any one or more of them, and all
partnerships, corporations or other entities directly or indirectly controlled by the
foregoing or any one or more of them.  

        “LC
Fee” is defined in Section 2.21.4.  

        “LC
Issuer”means the Lender (or any Affiliate of the Lender designated by the
Lender), in its capacity as issuer of Facility LCs hereunder.  

        “LC
Obligations” means, at any time, the sum, without duplication, of (i) the
aggregate undrawn stated amount of all Facility LCs outstanding at such time plus (ii)
the aggregate unpaid amount at such time of all Reimbursement Obligations.  

        “LC
Payment Date” is defined in Section 2.21.5.  

        “Lender”means
LaSalle Bank National Association and its successors and assigns.  

        “Lending
Installation” means, with respect to the Lender, the office, branch, subsidiary
or Affiliate of the Lender with respect to each Agreed Currency listed on a Schedule or
otherwise selected by the Lender pursuant to Section 2.18.  

        “Leverage
Ratio” is defined in Section 6.21.1.  

        “Leverage
Ratio (Pricing)” is defined in the Pricing Schedule.  

        “Lien” means
any lien (statutory or other), mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance or preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever (including, without limitation,
the interest of a vendor or lessor under any conditional sale, Capitalized Lease or other
title retention agreement, and, in the case of stock, stockholders agreements, voting
trust agreements and all similar arrangements).  

        “Loan” means
a Revolving Loan. 

        “Loan
Documents” means this Agreement, the Facility LC Applications, the Guaranty,
each Assumption Letter executed hereunder, and all other documents, instruments, notes
(including any Notes issued pursuant to Section 2.14 (if requested)) and
agreements executed in connection therewith or contemplated thereby, as the same may be
amended, restated or otherwise modified and in effect from time to time.  

        “Loan
Party” is defined in Section 4.1.1. 

12 

        “Material
Adverse Effect” means a material adverse effect on (i) the business, Property,
condition (financial or otherwise), operations, performance, properties, results of
operations or prospects of the Company, or the Company and its Subsidiaries taken as a
whole, (ii) the ability of the Company or any of its Subsidiaries to perform its
respective obligations under the Loan Documents to which it is a party, or (iii) the
validity or enforceability of any of the Loan Documents or the rights or remedies of the
Lender and the LC Issuer thereunder.  

        “Material
Indebtedness” is defined in Section 7.5.  

        “Maximum
Eurocurrency Amount” means $20,000,000. 

        “Modify”and
“Modification” are defined in Section 2.21.1.  

        “Moody’s”means
Moody’s Investors Service, Inc. and any successor thereto.  

        “Multiemployer
Plan” shall mean a “multiemployer plan” as defined in Section 4001(a)
(3) of ERISA which is, or within the immediately preceding six (6) years was, contributed
to by either the Company or any ERISA Affiliate.  

        “National
Currency Unit” means the unit of currency (other than a euro unit) of each
member state of the European Union that participates in the third stage of Economic and
Monetary Union.  

        “Net
Income” means, for any period for any group of Persons, the net earnings (or
loss) after taxes of such group of Persons on a consolidated basis for such period taken
as a single accounting period determined in conformity with Agreement Accounting
Principles.  

        “Note” is
defined in Section 2.14. 

        “Obligations”means
all Loans, Reimbursement Obligations, advances, debts, liabilities, obligations,
covenants and duties owing by the Borrowers to any of the LC Issuer, the Lender, or any
Affiliate of the LC Issuer or the Lender, or any indemnitee under the provisions of Section
10.6 or any other provisions of the Loan Documents, in each case of any kind or
nature, present or future, arising under this Agreement or any other Loan Document,
whether or not evidenced by any note, guaranty or other instrument, whether or not for
the payment of money, whether arising by reason of an extension of credit, loan, foreign
exchange risk, guaranty, indemnification, or in any other manner, whether direct or
indirect (including those acquired by assignment), absolute or contingent, due or to
become due, now existing or hereafter arising and however acquired. The term includes,
without limitation, all interest, charges, expenses, fees, attorneys’ fees and
disbursements, paralegals’ fees (in each case whether or not allowed), and any other
sum chargeable to the Company or any of its Subsidiaries under this Agreement or any
other Loan Document.  

        “Off-Balance
Sheet Liability” of a Person means (i) any repurchase obligation or liability of
such Person or any of its Subsidiaries with respect to receivables sold by such Person or
any of its Subsidiaries (calculated to include the unrecovered investment of purchasers
or transferees of receivables or any other obligation of the Company or such transferor
to purchasers/transferees of interests in receivables or the agent for such
purchasers/transferees), (ii) any liability under any sale and leaseback transaction
which is not a Capitalized Lease, (iii) any liability under any financing lease or
Synthetic Lease or “tax ownership operating lease” transaction entered into by
such Person, including any Synthetic Lease Obligations, or (iv) any obligation arising
with respect to any other transaction which is the functional equivalent of or takes the
place of borrowing but which does not constitute a liability on the consolidated balance
sheets of such Person, but excluding from this clause (iv) Operating Leases.  

13 

        “Operating
Lease”of a Person means any lease of Property (other than a Capitalized Lease)
by such Person as lessee which has an original term (including any required renewals and
any renewals effective at the option of the lessor) of one year or more.  

        “Other
Taxes” is defined in Section 3.5.2.  

        “Outstanding
Credit Exposure” means, at any time, the sum of (i) the aggregate principal
amount of Revolving Loans outstanding at such time, plus (ii) an amount equal to the LC
Obligations at such time.  

        “Participants” is
defined in Section 13.2.1. 

        “Payment
Date” means the last day of each March, June, September and December and the
Facility Termination Date.  

        “PBGC”means
the Pension Benefit Guaranty Corporation, or any successor thereto.  

        “Performance
LC” means a Facility LC that is a documentary or trade letter of credit which is
drawable upon presentation of documents evidencing the sale or shipment of goods
purchased by the Company or a Subsidiary in the ordinary course of its business.  

        “Permitted
Acquisition” is defined in Section 6.15.5.  

        “Permitted
Refinancing Indebtedness” means any replacement, renewal, refinancing or
extension of any Indebtedness permitted by this Agreement that (i) does not exceed the
aggregate principal amount (plus accrued interest and any applicable premium and
associated fees and expenses) of the Indebtedness being replaced, renewed, refinanced or
extended, (ii) does not have a Weighted Average Life to Maturity at the time of such
replacement, renewal, refinancing or extension that is less than the Weighted Average
Life to Maturity of the Indebtedness being replaced, renewed, refinanced or extended,
(iii) does not rank at the time of such replacement, renewal, refinancing or extension
senior to the Indebtedness being replaced, renewed, refinanced or extended, and (iv) does
not contain terms (including, without limitation, terms relating to security,
amortization, interest rate, premiums, fees, covenants, event of default and remedies)
materially less favorable to the Borrowers or to the Lender than those applicable to the
Indebtedness being replaced, renewed, refinanced or extended.  

        “Person”means
any natural person, corporation, firm, joint venture, partnership, limited liability
company, association, enterprise, trust or other entity or organization, or any
government or political subdivision or any agency, department or instrumentality thereof.  

14 

        “Plan”means
an employee benefit plan which is covered by Title IV of ERISA or subject to the minimum
funding standards under Section 412 of the Code as to which the Company or any member of
its Controlled Group may have any liability.  

        “Pricing
Schedule” means the Schedule identifying the Applicable Margin, the Applicable
Performance LC Fee, and the Applicable Commitment Fee Rate attached hereto identified as
such.  

        “Prime
Rate” means a rate per annum equal to the prime rate of interest announced from
time to time by the Lender (which is not necessarily the lowest rate charged to any
customer), changing when and as said prime rate changes.  

        “Property”of
a Person means any and all property, whether real, personal, tangible, intangible, or
mixed, of such Person, or other assets owned, leased or operated by such Person.  

        “Purchase
Price” means the total consideration and other amounts payable in connection
with any Acquisition or Investment, including, without limitation, any portion of the
consideration payable in cash, the value of any Capital Stock or other equity interests
of the Company or any Subsidiary issued as consideration for such Acquisition or
Investment, all Indebtedness, liabilities and contingent obligations incurred or assumed
in connection with such Acquisition or Investment and all transaction costs and expenses
incurred in connection with such Acquisition or Investment.  

        “Regulation
D”means Regulation D of the Board of Governors of the Federal Reserve System as
from time to time in effect and any successor thereto or other regulation or official
interpretation of said Board of Governors relating to reserve requirements applicable to
member banks of the Federal Reserve System.  

        “Regulation
T” means Regulation T of the Board of Governors of the Federal Reserve System as
from time to time in effect and any successor or other regulation or official
interpretation of said Board of Governors relating to the extension of credit by and to
brokers and dealers of securities for the purpose of purchasing or carrying margin stock
(as defined therein).  

        “Regulation
U” means Regulation U of the Board of Governors of the Federal Reserve System as
from time to time in effect and any successor or other regulation or official
interpretation of said Board of Governors relating to the extension of credit by banks,
non-banks and non-broker lenders for the purpose of purchasing or carrying margin stocks
applicable to member banks of the Federal Reserve System.  

        “Regulation
X” means Regulation X of the Board of Governors of the Federal Reserve System as
from time to time in effect and any successor or other regulation or official
interpretation of said Board of Governors relating to the extension of credit by foreign
lenders for the purpose of purchasing or carrying margin stock (as defined therein).  

        “Reimbursement
Obligations” means with respect to the LC Issuer, at any time, the aggregate of
all obligations of the Borrowers then outstanding under Section 2.21 to reimburse
the LC Issuer for amounts paid by the LC Issuer in respect of any one or more drawings
under Facility LCs issued by the LC Issuer; or, as the context may require, all such
Reimbursement Obligations then outstanding to reimburse the LC Issuer.  

15 

        “Rentals”means
the aggregate fixed amounts payable by the Company and its Subsidiaries on a consolidated
basis under any lease of real or personal property having an original term (including any
required renewals or any renewals at the option of the lessor or lessee) of one year or
more, but does not include any amounts payable under Capitalized Leases.  

        “Reportable
Event” shall mean any Reportable Event as defined in Section 4043 of ERISA or
the regulations thereunder for which the 30-day notice requirement has not been waived by
the PBGC.  

        “Reserve
Requirement” means, with respect to an Interest Period, the maximum aggregate
reserve requirement (including all basic, supplemental, marginal and other reserves)
which is imposed under Regulation D on “Eurocurrency liabilities” (as defined
in Regulation D).  

        “Revolving
Loan” means the Lender’s loan made pursuant to its commitment to lend set
forth in Section 2.1 (or any conversion or continuation thereof).  

        “Risk
Based Capital Guidelines” is defined in Section 3.2.  

        “S&P” means
Standard and Poor's Ratings Services,  a division of The McGraw-Hill  Companies,  Inc.
and any successor thereto. 

        “Schedule”refers
to a specific schedule to this Agreement, unless another document is specifically
referenced.  

        “Section”means
a numbered section of this Agreement, unless another document is specifically referenced.  

        “Single
Employer Plan” means a Plan maintained by the Company or any member of its
Controlled Group for employees of the Company or any member of its Controlled Group.  

        “Standby
LC” means any Facility LC other than a Performance LC.  

        “Subsidiary”of
a Person means (i) any corporation more than fifty percent (50%) of the outstanding
securities having ordinary voting power of which shall at the time be owned or
controlled, directly or indirectly, by such Person or by one or more of its Subsidiaries
or by such Person and one or more of its Subsidiaries, or (ii) any partnership, limited
liability company, association, joint venture or similar business organization more than
fifty percent (50%) of the ownership interests having ordinary voting power of which
shall at the time be so owned or controlled. Unless otherwise expressly provided, all
references herein to a “Subsidiary” shall mean a Subsidiary of the Company.  

        “Subsidiary
Borrower” means each of the Company’s Subsidiaries listed on Schedule 1.1,
and any other Subsidiaries of the Company duly designated by the Company pursuant to Section
2.22 to request Credit Extensions hereunder, which Subsidiary shall have delivered to
the Lender an Assumption Letter in accordance with Section 2.22 and such other
documents as may be required pursuant to this Agreement, in each case, together with its
respective successors and assigns, including a debtor-in-possession on behalf of such
Subsidiary Borrower.  

16 

        “Substantial
Portion” means, with respect to the Property of the Company and its
Subsidiaries, Property which (i) represents more than ten percent (10%) of the
consolidated assets of the Company and its Subsidiaries as would be shown in the
consolidated financial statements of the Company and its Subsidiaries as at the end of
the four fiscal quarter period ending with the fiscal quarter immediately prior to the
fiscal quarter in which such determination is made, or (ii) is responsible for more than
ten percent (10%) of the Consolidated Net Income of the Company and its Subsidiaries as
reflected in the financial statements referred to in clause (i) above.  

        “Synthetic
Lease” means a so-called “synthetic” lease that is not treated as a
capital lease under Agreement Accounting Principles, but that is treated as a financing
under the Code.  

        “Synthetic
Lease Obligations” means, collectively, the payment obligations of the Company
or any of its Subsidiaries pursuant to a Synthetic Lease.  

        “Taxes”means
any and all present or future taxes, duties, levies, imposts, deductions, charges or
withholdings, and any and all liabilities with respect to the foregoing, but excluding
Excluded Taxes.  

        “Termination
Event”shall mean (i) a Reportable Event with respect to any Benefit Plan; (ii)
the withdrawal of the Company or any ERISA Affiliate from a Benefit Plan during a plan
year in which the Company or such ERISA Affiliate was a “substantial employer”as
defined in Section 4001(a) (2) of ERISA; (iii) the imposition of an obligation on the
Company or any ERISA Affiliate under Section 4041 of ERISA to provide affected parties
written notice of intent to terminate a Benefit Plan in a distress termination described
in Section 4041(c) of ERISA; (iv) the institution by the PBGC of proceedings to terminate
a Benefit Plan; (v) any event or condition which might constitute grounds under Section
4042 of ERISA for the termination of, or the appointment of a trustee to administer, any
Benefit Plan; or (vi) the partial or complete withdrawal of the Company or any ERISA
Affiliate from a Multiemployer Plan.  

        “Total
Funded Debt” shall mean, without duplication, Funded Debt of the Company and its
Subsidiaries determined on a consolidated basis eliminating intercompany items.  

        “Transferee” is
defined in Section 13.3. 

        “Type”means,
with respect to any Advance, its nature as a Floating Rate Advance or a Eurocurrency
Advance.  

        “Unfunded
Liabilities” means the amount (if any) by which the present value of all vested
and unvested accrued benefits under all Single Employer Plans exceeds the fair market
value of all such Plan assets allocable to such benefits, all determined as of the then
most recent valuation date for such Plans using PBGC actuarial assumptions for single
employer plan terminations.  

17 

        “Unmatured
Default” means an event which but for the lapse of time or the giving of notice,
or both, would constitute a Default.  

        “Weighted
Average Life to Maturity” means when applied to any Indebtedness at any date,
the number of years obtained by dividing (i) the sum of the products obtained by
multiplying (a) the amount of each then remaining installment, sinking fund, serial
maturity or other required payments of principal, including payment at final maturity, in
respect thereof, by (b) the number of years (calculated to the nearest one-twelfth) that
will elapse between such date and the making of such payment, by (ii) the then
outstanding principal amount of such Indebtedness.  

        “Wholly-Owned
Subsidiary” of a Person means (i) any Subsidiary all of the outstanding voting
securities of which shall at the time be owned or controlled, directly or indirectly, 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, or (ii) any partnership,
limited liability company, association, joint venture or similar business organization
100% of the ownership interests having ordinary voting power of which shall at the time
be so owned or controlled.  

        The
foregoing definitions shall be equally applicable to both the singular and plural forms
of the defined terms.  

        Any
accounting terms used in this Agreement which are not specifically defined herein shall
have the meanings customarily given them in accordance with Agreement Accounting
Principles.  

        1.2     
References. Any references to the Company’s Subsidiaries shall not in any way
be construed as consent by the Lender to the establishment, maintenance or acquisition of
any Subsidiary, except as may otherwise be permitted hereunder.  

        1.3     
Supplemental Disclosure. At any time at the request of the Lender and at such
additional times as the Company determines, the Company shall supplement each schedule or
representation herein or in the other Loan Documents with respect to any matter hereafter
arising which, if existing or occurring at the date of this Agreement, would have been
required to be set forth as an exception to such representation or which is necessary to
correct any information in such representation which has been rendered inaccurate
thereby. Notwithstanding that any such supplement to such representation may disclose the
existence or occurrence of events, facts or circumstances which are either prohibited by
the terms of this Agreement or any other Loan Documents or which result in the breach of
any representation or warranty, such supplement to such representation shall not be
deemed either an amendment thereof or a waiver of such breach unless expressly consented
to in writing by the Lender under Section 8.2, and no such amendments, except as
the same may be consented to in a writing which expressly includes a waiver, shall be or
be deemed a waiver by the Lender of any Default disclosed therein. Any items disclosed in
any such supplemental disclosures shall be included in the calculation of any limits,
baskets or similar restrictions contained in this Agreement or any of the other Loan
Documents.  

18 

ARTICLE 2  

THE CREDITS  

        2.1     
Commitment. From and including the date of this Agreement and prior to the
Facility Termination Date, upon the satisfaction of the conditions precedent set forth in
Sections 4.1, 4.2and 4.3, as applicable, the Lender agrees, on
the terms and conditions set forth in this Agreement, to make Revolving Loans to the
Borrowers in Agreed Currencies from time to time in amounts not to exceed in the
aggregate at any one time outstanding the Dollar Amount of the Available Commitment;
provided that (i) at no time shall the Outstanding Credit Exposure hereunder exceed the
Commitment, (ii) at no time shall the aggregate outstanding Dollar Amount of all
Eurocurrency Advances denominated in an Agreed Currency other than Dollars exceed the
Maximum Eurocurrency Amount, (iii) all Floating Rate Loans shall be made in Dollars, and
(iv) at no time shall the Outstanding Credit Exposure of the Lender to all Borrowers that
are Foreign Subsidiaries exceed an amount equal to ten and one-half percent (10.5%) of
the Company’s Consolidated Tangible Assets as of the end of the most recently ended
fiscal year. Subject to the terms of this Agreement, the Borrowers may borrow, repay and
reborrow Revolving Loans at any time prior to the Facility Termination Date. The
Commitment to lend hereunder shall expire automatically on the Facility Termination Date.
The LC Issuer will issue Facility LCs hereunder on the terms and conditions set forth in
Section 2.21.  

        2.2     
[Reserved]  

        2.3     
     Determination of Dollar Amounts; Required Payments; Termination. 

	 	        2.3.1    
   Determination of Dollar Amounts.  The Lender will determine the Dollar Amount of: 

	 	        2.3.1.1    
each Credit Extension as of the date three Business Days prior to the Credit Extension
Borrowing Date or, if applicable, date of conversion/continuation of such Credit
Extension, and  

	 	        2.3.1.2    
all outstanding Credit Extensions on and as of the last Business Day of each quarter and
on any other Business Day elected by the Lender in its discretion. Each day upon or as of
which the Lender determines Dollar Amounts as described in the preceding Section
2.3.1.1 and this Section 2.3.1.2 is herein described as a “Computation
Date” with respect to each Credit Extension for which a Dollar Amount is determined
on or as of such day. If at any time the Dollar Amount of the sum of the aggregate
principal amount of all outstanding Credit Extensions (calculated, with respect to those
Credit Extensions denominated in Agreed Currencies other than Dollars, as of the most
recent Computation Date with respect to each such Credit Extension) exceeds the
Commitment, the Borrowers shall immediately repay Advances in an aggregate principal
amount sufficient to eliminate any such excess.  

	 	        2.3.2    
Required Payments. Any outstanding Advances and all other unpaid Obligations shall
be paid in full by the Borrowers on the Facility Termination Date. Notwithstanding
anything to the contrary herein or in any other Loan Document, in no event shall any of
the Subsidiary Borrowers that are Foreign Subsidiaries be deemed to have any liability
for the Obligations hereunder of the other Borrowers.  

19 

	 	        2.3.3    
Termination. Notwithstanding the termination of this Agreement on the Facility
Termination Date, until all of the Obligations (other than contingent indemnity
obligations) shall have been fully paid and satisfied and all financing arrangements
among the Borrowers and the Lender hereunder and under the other Loan Documents shall
have been terminated, all of the rights and remedies under this Agreement and the other
Loan Documents shall survive and the Lender shall be entitled to retain its security
interest in and to all existing and future collateral (if any).  

        2.4     
[Reserved]  

        2.5     
Types of Advances. The Advances may be Revolving Loans consisting of Floating Rate
Advances or Eurocurrency Advances, or a combination thereof, selected by the applicable
Borrower in accordance with Sections 2.9 and 2.10.  

        2.6     
Commitment Fee; Reductions in Commitment.  

	 	        2.6.1    
Commitment Fee. The Borrowers agree to pay to the Lender a commitment fee (the
“Commitment Fee”) at a per annum rate equal to the Applicable Commitment Fee
Rate on the daily unused portion of the Commitment from the Closing Date to and including
the date on which this Agreement is terminated in full and all Obligations hereunder have
been paid in full pursuant to Section 2.3, payable quarterly in arrears on each
Payment Date hereafter and until all Obligations hereunder have been paid in full.  

	 	        2.6.2    
Reductions in Commitment. The Borrowers may permanently reduce the Commitment in
whole, or in part in a minimum amount of $1,000,000 (and in multiples of $500,000 if in
excess thereof) (or the Approximate Equivalent Amount if denominated in an Agreed
Currency other than Dollars), upon at least three (3) Business Days’ prior written
notice to the Lender of such reduction, which notice shall specify the amount of any such
reduction; provided, however, that the amount of the Aggregate Commitment may not be
reduced below the Dollar Amount of the Outstanding Credit Exposure. All accrued
Commitment Fees shall be payable on the effective date of any termination of all or any
part of the obligations of the Lender to make Credit Extensions hereunder. For purposes
of calculating the Commitment Fee hereunder, the principal amount of each Credit
Extension made in an Agreed Currency other than Dollars shall be at any time the Dollar
Amount of such Credit Extension as determined on the most recent Computation Date with
respect to such Credit Extension.  

        2.7     
Minimum Amount of Each Advance. Each Eurocurrency Advance shall be in the minimum
amount of $1,000,000 (and in multiples of $500,000 if in excess thereof) (or the
Approximate Equivalent Amount if denominated in an Agreed Currency other than Dollars),
and each Floating Rate Advance shall be in the minimum amount of $1,000,000 (and in
multiples of $500,000 if in excess thereof), provided, however, that any Floating Rate
Advance may be in the amount of the Available Commitment.  

20 

        2.8     
Principal Payments.  

	 	        2.8.1    
Optional Principal Payments. The Borrowers may from time to time pay, without
penalty or premium, all outstanding Floating Rate Advances or any portion of the
outstanding Floating Rate Advances, in a minimum aggregate amount of $1,000,000 or any
integral multiple of $500,000 in excess thereof, upon prior notice to the Lender at or
before 12:00 noon (Chicago time) one (1) Business Day prior to the date of such payment.
The Borrowers may from time to time pay, subject to the payment of any funding
indemnification amounts required by Section 3.4 but without penalty or premium,
all outstanding Eurocurrency Ratable Advances, or, in a minimum aggregate amount of
$1,000,000 or any integral multiple of $500,000 in excess thereof (or the Approximate
Equivalent Amount if denominated in an Agreed Currency other than Dollars), any portion
of the outstanding Eurocurrency Ratable Advances upon five (5) Business Days’ prior
notice to the Lender.  

	 	        2.8.2    
Mandatory Principal Payments. Upon the consummation of any issuance of
Indebtedness permitted under Section 6.12.7, at any time the Leverage Ratio
(determined as of the last day of the most recent fiscal quarter for which a compliance
certificate shall have been delivered in accordance with Section 6.1) shall be
greater than or equal to 3.00 to 1.00, within two (2) Business Days after the Company’s
or any of its Subsidiaries’ receipt of any net cash proceeds from such issuance of
Indebtedness, the Company shall make a mandatory prepayment of the Obligations in an
amount equal to 100% of such net cash proceeds. All of the mandatory prepayments made
under this Section 2.8.2 shall be applied first to Floating Rate Loans and to any
Eurocurrency Rate Loans maturing on such date and then to subsequently maturing
Eurocurrency Rate Loans.  

        2.9     
     Method of Selecting  Types and Interest  Periods for New Advances;  Method of
 Borrowing;  Advances to be Made in euro. 

	 	        2.9.1    
Method of Selecting Types and Interest Periods for New Advances. The applicable
Borrower shall select the Type of Advance and, in the case of each Eurocurrency Advance,
the Interest Period and Agreed Currency applicable thereto from time to time; provided
that there shall be no more than eight (8) Interest Periods in effect with respect to all
of the Revolving Loans at any time, unless such limit has been waived by the Lender in
its sole discretion. The applicable Borrower shall give the Lender irrevocable notice (a
“Borrowing Notice”) not later than 10:00 a.m. (Chicago time) on the Borrowing
Date of each Floating Rate Advance, three (3) Business Days before the Borrowing Date for
each Eurocurrency Advance denominated in Dollars, and four (4) Business Days before the
Borrowing Date for each Eurocurrency Advance denominated in an Agreed Currency other than
Dollars, specifying:  

	 	        2.9.1.1    
 the Borrowing Date, which shall be a Business Day, of such Advance, 

	 	        2.9.1.2    
 the aggregate amount of such Advance, 

	 	        2.9.1.3    
 the Type of Advance selected, and 

	 	        2.9.1.4    
in the case of each Eurocurrency Advance, the Interest Period and Agreed Currency
applicable thereto.  

21 

	 	        2.9.2    
Method of Borrowing. On each Borrowing Date, the Lender shall make available its
Loan or Loans, if any, (i) if such Loan is denominated in Dollars, not later than noon,
Chicago time, in Federal or other funds immediately available to the Lender, in Chicago,
Illinois at its address specified in or pursuant to Article XIV and, (ii) if such Loan is
denominated in an Agreed Currency other than Dollars, not later than noon, local time, in
the city of the Lender’s Eurocurrency Payment Office for such currency, in such
funds as may then be customary for the settlement of international transactions in such
currency in the city of and at the address of the Lender’s Eurocurrency Payment
Office for such currency. Unless the Lender determines that any applicable condition
specified in Article IV has not been satisfied, the Lender will make the funds available
to the applicable Borrower at the Lender’s aforesaid address. Notwithstanding the
foregoing provisions of this Section 2.9.2, to the extent that a Loan matures on
the Borrowing Date of a requested Loan, the Lender shall apply the proceeds of the Loan
it is then making to the repayment of principal of the maturing Loan.  

	 	        2.9.3    
Advances to be Made in euro. If any Advance would, but for the provisions of this
Section 2.9.3, be capable of being made in either euro or in a National Currency
Unit, such Advance shall be made in euro.  

        2.10    
Conversion and Continuation of Outstanding Advances. Floating Rate Advances shall
continue as Floating Rate Advances unless and until such Floating Rate Advances are
converted into Eurocurrency Advances pursuant to this Section 2.10 or are repaid
in accordance with Section 2.8. Each Eurocurrency Advance shall continue as a
Eurocurrency Advance until the end of the then applicable Interest Period therefor, at
which time:  

	 	        2.10.1    
each such Eurocurrency Advance denominated in Dollars shall be automatically converted
into a Floating Rate Advance unless (x) such Eurocurrency Advance is or was repaid in
accordance with Section 2.8 or (y) the applicable Borrower shall have given the
Lender a Conversion/Continuation Notice (as defined below) requesting that, at the end of
such Interest Period, such Eurocurrency Advance continue as a Eurocurrency Advance for
the same or another Interest Period or be converted into a Floating Rate Advance; and  

	 	        2.10.2    
each such Eurocurrency Advance denominated in an Agreed Currency other than Dollars shall
automatically continue as a Eurocurrency Advance in the same Agreed Currency with an
Interest Period of one month unless (x) such Eurocurrency Advance is or was repaid in
accordance with Section 2.8, or (y) the applicable Borrower shall have given the
Lender a Conversion/Continuation Notice (as defined below) requesting that, at the end of
such Interest Period, such Eurocurrency Advance continue as a Eurocurrency Advance for
the same or another Interest Period. Subject to the terms of Section 2.7, the
Borrowers may elect from time to time to convert all or any part of an Advance of any
Type into any other Type or Types of Advances denominated in the same or any other Agreed
Currency; provided that any conversion of any Eurocurrency Advance shall be made on, and
only on, the last day of the Interest Period applicable thereto. The applicable Borrower
shall give the Lender irrevocable notice (a “Conversion/Continuation Notice”)
of each conversion of an Advance or continuation of a Eurocurrency Advance not later than
10:00 a.m. (Chicago time) at least one (1) Business Day, in the case of a conversion into
a Floating Rate Advance, three (3) Business Days, in the case of a conversion into or
continuation of a Eurocurrency Advance denominated in Dollars, or four (4) Business Days,
in the case of a conversion into or continuation of a Eurocurrency Advance denominated in
an Agreed Currency other than Dollars, prior to the date of the requested conversion or
continuation, specifying:  

22 

	 	        2.10.2.1    
the requested date, which shall be a Business Day, of such conversion or continuation,  

	 	        2.10.2.2    
the Agreed  Currency,  the aggregate amount and Type of the Advance which is to be
converted or continued, and 

	 	        2.10.2.3    
the amount of such Advance which is to be converted into or continued as a Eurocurrency
Advance and the duration of the Interest Period applicable thereto.  

        2.11    
Changes in Interest Rate, etc. Each Floating Rate Advance shall bear interest on
the outstanding principal amount thereof, for each day from and including the date such
Advance is made or is automatically converted from a Eurocurrency Advance into a Floating
Rate Advance pursuant to Section 2.10, to but excluding the date it is paid or is
converted into a Eurocurrency Advance pursuant to Section 2.10 hereof, at a rate
per annum equal to the Floating Rate for such day. Changes in the rate of interest on
that portion of any Advance maintained as a Floating Rate Advance will take effect
simultaneously with each change in the Alternate Base Rate. Each Eurocurrency Advance
shall bear interest on the outstanding principal amount thereof from and including the
first day of the Interest Period applicable thereto to (but not including) the last day
of such Interest Period at the interest rate determined by the Lender as applicable to
such Eurocurrency Advance based upon the applicable Borrower’s selections under Sections
2.9 and 2.10 and otherwise in accordance with the terms hereof. No Interest
Period may end after the Facility Termination Date.  

        2.12    
No Conversion or Continuation of Eurocurrency Advances After Default; Rates Applicable
After Default. Notwithstanding anything to the contrary contained in Section 2.10,
no Advance may be converted or continued as a Eurocurrency Advance (except with the
consent of the Lender) when any Default or Unmatured Default is continuing. During the
continuance of a Default (including the Borrowers’ failure to pay any Loan at
maturity) the Lender may, at its option, by notice to the Borrowers (which notice may be
revoked at the option of the Lender), declare that (i) the Advances, all fees or any
other Obligations hereunder shall bear interest at the Floating Rate plus 2% per annum
and (ii) the LC Fee shall be increased by 2% per annum, provided that, during the
continuance of a Default under Section 7.6 or 7.7, such interest rate and
such increase in the LC Fee set forth above shall be applicable to all Credit Extensions,
Advances, fees and other Obligations hereunder without any election or action on the part
of the LC Issuer or the Lender.  

        2.13    
Method of Payment.  

	 	        2.13.1    
Each Advance shall be repaid and each payment of interest thereon shall be paid in the
currency in which such Advance was made or, where such currency has converted to the
euro, in the euro. All payments of the Obligations hereunder shall be made, without
setoff, deduction, or counterclaim, in immediately available funds to the Lender at
(except as set forth in the next sentence) the Lender’s address specified pursuant
to Article XIV, or at any other Lending Installation of the Lender specified in writing
by the Lender to the Company, by 12:00 noon (Chicago time) on the date when due. All
payments to be made by the Borrowers hereunder in any currency other than Dollars shall
be made in such currency on the date due in such funds as may then be customary for the
settlement of international transactions in such currency for the account of the Lender
at its Eurocurrency Payment Office for such currency. Each reference to the Lender in
this Section 2.13 shall also be deemed to refer, and shall apply equally, to the
LC Issuer, in the case of payments required to be made by the applicable Borrower to the
LC Issuer pursuant to Section 2.21.6. The Lender is hereby authorized to charge
the account of the Borrowers maintained with Lender or any of its Affiliates for each
payment of principal, interest and fees as it becomes due hereunder.  

23 

	 	        2.13.2    
Notwithstanding the foregoing provisions of this Section, if, after the making of any
Advance in any currency other than Dollars, currency control or exchange regulations are
imposed in the country which issues such currency with the result that the type of
currency in which the Advance was made (the “Original Currency”) no longer
exists or any Borrower is not able to make payment to the Lender in such Original
Currency, then all payments to be made by any Borrower hereunder in such currency shall
instead be made when due in Dollars in an amount equal to the Dollar Amount (as of the
date of repayment) of such payment due, it being the intention of the parties hereto that
the Borrowers take all risks of the imposition of any such currency control or exchange
regulations. For purposes of this Section 2.13.2, the commencement of the
third stage of European Economic and Monetary Union shall not constitute the imposition
of currency control or exchange regulations.  

        2.14    
Noteless Agreement; Evidence of Indebtedness.  

	 	        2.14.1    
The Lender shall maintain in accordance with its usual practice an account or accounts
evidencing the indebtedness of the Borrowers to the Lender resulting from each Loan made
by the Lender from time to time, including the amounts of principal and interest payable
and paid to the Lender from time to time hereunder.  

	 	        2.14.2    
The Lender shall also maintain accounts in which it will record (a) the date and the
amount of each Revolving Loan made hereunder, the Agreed Currency and Type thereof and
the Interest Period, if any, applicable thereto, (b) the amount of any principal or
interest due and payable or to become due and payable from any Borrower to the Lender
hereunder, (c) the original stated amount of each Facility LC and the amount of LC
Obligations outstanding at any time, (d) the amount of any sum received by the Lender
hereunder from the Borrowers, and (e) all other appropriate debits and credits as
provided in this Agreement, including, without limitation, all fees, charges, expenses
and interest.  

	 	        2.14.3    
The entries maintained in the accounts maintained pursuant to Sections 2.14.1 and
2.14.2 above shall be prima facie evidence of the existence and amounts of the
Obligations therein recorded; provided, however, that the failure of the Lender to
maintain such accounts or any error therein shall not in any manner affect the obligation
of the Borrowers to repay the Obligations in accordance with their terms.  

	 	        2.14.4    
The Lender may request that its Loans be evidenced by a promissory note, substantially in
the form of Exhibit D(a “Note”). In such event, the Borrowers shall
prepare, execute and deliver to the Lender such Note payable to the order of the Lender.  

24 

        2.15    
Telephonic Notices. The Borrowers hereby authorize the Lender to extend, convert
or continue Advances, effect selections of Types of Advances and transfer funds based on
telephonic notices made by any person or persons the Lender in good faith believes to be
acting on behalf of a Borrower, it being understood that the foregoing authorization is
specifically intended to allow Borrowing Notices and Conversion/Continuation Notices to
be given telephonically. The Borrowers agree to deliver promptly to the Lender a written
confirmation, signed by an Authorized Officer, if such confirmation is requested by the
Lender, of each telephonic notice. If the written confirmation differs in any material
respect from the action taken by the Lender, the records of the Lender shall govern
absent manifest error.  

        2.16    
Interest Payment Dates; Interest and Fee Basis. Interest accrued on each Floating
Rate Advance shall be payable in arrears on each Payment Date, commencing with the first
such date to occur after the Closing Date, on any date on which the Floating Rate Advance
is prepaid, whether due to acceleration or otherwise, and at maturity. Interest accrued
on that portion of the outstanding principal amount of any Floating Rate Advance
converted into a Eurocurrency Advance on a day other than a Payment Date shall be payable
on the date of conversion. Interest accrued on each Eurocurrency Advance shall be payable
on the last day of its applicable Interest Period, on any date on which the Eurocurrency
Advance is prepaid, whether by acceleration or otherwise, and at maturity; provided, that
interest accrued on each Eurocurrency Advance having an Interest Period longer than three
(3) months shall also be payable on the last day of each three-month interval during such
Interest Period. Interest on Eurocurrency Advances (other than Eurocurrency Advances
denominated in British Pounds Sterling), LC Fees and Commitment Fees shall be calculated
for actual days elapsed on the basis of a 360-day year; interest on Floating Rate
Advances for which the Prime Rate is the basis and Eurocurrency Advances denominated in
British Pounds Sterling shall be calculated for actual days elapsed on the basis of a
365/366-day year. Interest shall be payable for the day an Advance is made but not for
the day of any payment on the amount paid if payment is received prior to 12:00 noon
(Chicago time) at the place of payment. If any payment of principal of or interest on an
Advance, any fees or any other amounts payable to the Lender hereunder shall become due
on a day which is not a Business Day, such payment shall be made on the next succeeding
Business Day and, in the case of a principal payment, such extension of time shall be
included in computing interest, fees and commissions in connection with such payment.  

        2.17    
[Reserved]  

        2.18    
Lending Installations. The Lender may book its Loans and the LC Issuer may book
the Facility LCs at any Lending Installation selected by the Lender or the LC Issuer, as
the case may be, and may change its Lending Installation from time to time. All terms of
this Agreement shall apply to any such Lending Installation and the Loans, the Facility
LCs, and any Notes issued hereunder shall be deemed held by the Lender or the LC Issuer,
as the case may be, for the benefit of any such Lending Installation. The Lender and the
LC Issuer may, by written notice to the Company in accordance with Article XIV, designate
replacement or additional Lending Installations through which Loans will be made by it or
Facility LCs will be issued by it and for whose account Loan payments or payments with
respect to Facility LCs are to be made.  

        2.19    
[Reserved]  

25 

        2.20    
[Reserved]  

        2.21    
Facility LCs.  

	 	        2.21.1    
Issuance; Transitional Facility LCs.  

	 	        2.21.1.1    
Issuance. The LC Issuer hereby agrees, on the terms and conditions set forth in
this Agreement, to issue standby and performance letters of credit in Agreed Currencies
(each, together with the letters of credit deemed issued by the LC Issuer hereunder
pursuant to Section 2.21.1.2, a “Facility LC”) and to renew, extend,
increase, decrease or otherwise modify each Facility LC (“Modify,” and each
such action a “Modification”), from time to time from and including the date of
this Agreement and prior to the Facility Termination Date upon the request of any
Borrower; provided that immediately after each such Facility LC is issued or Modified,
(i) the aggregate amount of the outstanding LC Obligations shall not exceed $6,000,000
and (ii) the Outstanding Credit Exposure shall not exceed the Commitment. No Facility LC
shall have an expiry date later than the earlier of the fifth Business Day prior to the
Facility Termination Date and (y) one year after its issuance.  

	 	        2.21.1.2    
[Reserved]  

	 	        2.21.2    
[Reserved]  

	 	        2.21.3    
Notice. Subject to Section 2.21.1, the applicable Borrower shall give the
LC Issuer notice prior to 10:00 a.m. (Chicago time) at least five (5) Business Days prior
to the proposed date of issuance or Modification of each Facility LC, specifying the
beneficiary, the proposed date of issuance (or Modification) and the expiry date of such
Facility LC, and describing the proposed terms of such Facility LC and the nature of the
transactions proposed to be supported thereby. The issuance or Modification by the LC
Issuer of any Facility LC shall, in addition to the conditions precedent set forth in
Article IV (the satisfaction of which the LC Issuer shall have no duty to ascertain), be
subject to the conditions precedent that such Facility LC shall be satisfactory to the LC
Issuer and that the applicable Borrower shall have executed and delivered such
application agreement and/or such other instruments and agreements relating to such
Facility LC as the LC Issuer shall have reasonably requested (each, a “Facility LC
Application”). In the event of any conflict between the terms of this Agreement and
the terms of any Facility LC Application, the terms of this Agreement shall control.  

	 	        2.21.4    
LC Fees. The Borrowers shall pay to the LC Issuer, a letter of credit fee at a per
annum rate equal to (x) with respect to each Standby LC, the Applicable Margin for
Eurocurrency Loans in effect from time to time on the average daily undrawn stated amount
under such Standby LC, and (y) with respect to each Performance LC, the Applicable
Performance LC Fee in effect from time to time on the average daily undrawn stated amount
under each Performance LC, such fees to be payable in arrears on each Payment Date (each
such fee described in this sentence being an “LC Fee”). The Borrowers shall
also pay to the LC Issuer (x) at the time of the LC Issuer’s issuance of any
Facility LC, a fronting fee equal to 0.15% per annum on the initial stated amount
available for drawing under each such Facility LC issued by the LC Issuer, and (y)
documentary and processing charges in connection with the issuance or Modification of and
draws under Facility LCs in accordance with the LC Issuer’s standard schedule for
such charges as in effect from time to time.  

26 

	 	        2.21.5    
Administration. Upon receipt from the beneficiary of any Facility LC of any demand
for payment under such Facility LC, the LC Issuer shall notify the Company as to the
amount to be paid by the LC Issuer as a result of such demand and the proposed payment
date (the “LC Payment Date”). The responsibility of the LC Issuer to the
Borrowers shall be only to determine that the documents (including each demand for
payment) delivered under each Facility LC issued by the LC Issuer in connection with such
presentment shall be in conformity in all material respects with such Facility LC.  

	 	        2.21.6    
Reimbursement by the Borrowers.  

	 	        2.21.6.1    
Each Borrower shall be irrevocably and unconditionally obligated to reimburse the LC
Issuer on or before the applicable LC Payment Date for any amounts to be paid by the LC
Issuer upon any drawing under any Facility LC issued by the LC Issuer for the account of
such Borrower (such obligation being a “Reimbursement Obligation”), without
presentment, demand, protest or other formalities of any kind; provided that no Borrower
shall be precluded from asserting any claim for direct (but not consequential) damages
suffered by such Borrower to the extent, but only to the extent, caused by (a) the
willful misconduct or gross negligence of the LC Issuer in determining whether a request
presented under any Facility LC issued by it complied with the terms of such Facility LC
or (b) the LC Issuer’s failure to pay under any Facility LC issued by it after the
presentation to it of a request strictly complying with the terms and conditions of such
Facility LC.  

	 	        2.21.6.2    
If any Borrower at any time fails to repay a Reimbursement Obligation on or before the
applicable LC Payment Date, such unpaid Reimbursement Obligation shall at that time be
automatically converted into an obligation denominated in Dollars and such Borrower shall
be deemed to have elected to borrow Revolving Loans from the Lender, as of the date of
the advance giving rise to the Reimbursement Obligation, equal in amount to the Dollar
Amount of the unpaid Reimbursement Obligation. Such Revolving Loans shall be made as of
the date of the payment giving rise to such Reimbursement Obligation, automatically,
without notice and without any requirement to satisfy the conditions precedent otherwise
applicable to an Advance of Revolving Loans. Such Revolving Loans shall constitute a
Floating Rate Advance, the proceeds of which Advance shall be used to repay such
Reimbursement Obligation. If, for any reason, any Borrower fails to repay a Reimbursement
Obligation on the day such Reimbursement Obligation arises and, for any reason, the
Lender is unable to make or has no obligation to make Revolving Loans, then such
Reimbursement Obligation shall bear interest, payable on demand, for each day until paid
at a rate per annum equal to the sum of two percent (2%) plus the rate applicable to
Floating Rate Advances for such day (or, in the case of a Reimbursement Obligation
denominated in an Agreed Currency other than Dollars, at the rate determined by the LC
Issuer in good faith to represent such LC Issuer’s cost of overnight or short-term
funds in the applicable Agreed Currency plus the then effective Applicable Eurodollar
Margin). The Borrowers agree to indemnify the LC Issuer against any loss or expense
determined by the LC Issuer in good faith to have resulted from any conversion pursuant
to this Section 2.21.6.2 by reason of the inability of the LC Issuer to convert
the Dollar Amount received from the applicable Borrower into an amount in the applicable
Agreed Currency of such Letter of Credit equal to the amount of such Reimbursement
Obligation.  

27 

	 	        2.21.7    
Obligations Absolute. The Borrowers’ obligations under this Section 2.21 shall
be absolute and unconditional under any and all circumstances and irrespective of any
setoff, counterclaim or defense to payment which any Borrower may have or have had
against the LC Issuer, the Lender or any beneficiary of a Facility LC. The Borrowers
further agree with the LC Issuer and the Lender that the LC Issuer and the Lender shall
not be responsible for, and no Borrower’s Reimbursement Obligation in respect of any
Facility LC shall be affected by, among other things, the validity or genuineness of
documents or of any endorsements thereon, even if such documents should in fact prove to
be in any or all respects invalid, fraudulent or forged, or any dispute between or among
any Borrower, any of its Affiliates, the beneficiary of any Facility LC or any financing
institution or other party to whom any Facility LC may be transferred or any claims or
defenses whatsoever of any Borrower or of any of its Affiliates against the beneficiary
of any Facility LC or any such transferee. The LC Issuer shall not be liable for any
error, omission, interruption or delay in transmission, dispatch or delivery of any
message or advice, however transmitted, in connection with any Facility LC. The Borrowers
agree that any action taken or omitted by the LC Issuer or the Lender under or in
connection with each Facility LC and the related drafts and documents, if done without
gross negligence or willful misconduct, shall be binding upon the Borrowers and shall not
put the LC Issuer or the Lender under any liability to the Borrowers. Nothing in this Section
2.21.7 is intended to limit the right of the Borrowers to make a claim against the LC
Issuer for damages as contemplated by the proviso to the first sentence of Section
2.21.6.  

	 	        2.21.8    
Actions of LC Issuer. The LC Issuer shall be entitled to rely, and shall be fully
protected in relying, upon any Facility LC, draft, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype message,
statement, order or other document believed by it to be genuine and correct and to have
been signed, sent or made by the proper Person or Persons, and upon advice and statements
of legal counsel, independent accountants and other experts selected by the LC Issuer.  

	 	        2.21.9    
Indemnification. The Borrowers hereby agree to indemnify and hold harmless the
Lender and the LC Issuer, and their respective directors, officers, agents and employees
from and against any and all claims and damages, losses, liabilities, costs or expenses
which the Lender and the LC Issuer may incur (or which may be claimed against the Lender
or the LC Issuer by any Person whatsoever) by reason of or in connection with the
issuance, execution and delivery or transfer of or payment or failure to pay under any
Facility LC or any actual or proposed use of any Facility LC, including, without
limitation, any claims, damages, losses, liabilities, costs or expenses which the LC
Issuer may incur by reason of or on account of the LC Issuer issuing any Facility LC
which specifies that the term “Beneficiary” included therein includes any
successor by operation of law of the named Beneficiary, but which Facility LC does not
require that any drawing by any such successor Beneficiary be accompanied by a copy of a
legal document, satisfactory to the LC Issuer, evidencing the appointment of such
successor Beneficiary; provided that the Borrowers shall not be required to indemnify the
LC Issuer for any claims, damages, losses, liabilities, costs or expenses to the extent,
but only to the extent, caused by (x) the willful misconduct or gross negligence of the
LC Issuer in determining whether a request presented under any Facility LC issued by the
LC Issuer complied with the terms of such Facility LC or (y) the LC Issuer’s failure
to pay under any Facility LC issued by the LC Issuer after the presentation to it of a
request strictly complying with the terms and conditions of such Facility LC. Nothing in
this Section 2.21.9 is intended to limit the obligations of the Borrowers under
any other provision of this Agreement.  

28 

	 	        2.21.10    
[Reserved]  

	 	        2.21.11    
Facility LC Collateral Account. Each Borrower agrees that it will, as required by
Section 8.1 and until the final expiration date of any Facility LC and thereafter
as long as any amount is payable to the LC Issuer or the Lender in respect of any
Facility LC, maintain a special collateral account pursuant to arrangements satisfactory
to the Lender (the “Facility LC Collateral Account”) at the Lender’s
office at the address specified pursuant to Article XIV, in the name of such Borrower but
under the sole dominion and control of the Lender and in which such Borrower shall have
no interest other than as set forth in Section 8.1. Each Borrower hereby pledges,
assigns and grants to the Lender, on behalf of and for the benefit of the Lender and the
LC Issuer, a security interest in all of such Borrower’s right, title and interest
in and to all funds which may from time to time be on deposit in the Facility LC
Collateral Account to secure the prompt and complete payment and performance of the
Obligations. The Lender will invest any funds on deposit from time to time in the
Facility LC Collateral Account in certificates of deposit of the Lender having a maturity
not exceeding 30 days. Nothing in this Section 2.21.11 shall either obligate the
Lender to require the Borrowers to deposit any funds in the Facility LC Collateral
Account or limit the right of the Lender to release any funds held in the Facility LC
Collateral Account in each case other than as required by Section 8.1.  

        2.22    
Subsidiary Borrowers. The Company may at any time or from time to time, with the
consent of the Lender, add as a party to this Agreement any Subsidiary to be a Subsidiary
Borrower hereunder by the execution and delivery to the Lender of (a) a duly completed
Assumption Letter by such Subsidiary, with the written consent of the Borrowers at the
foot thereof, (b) such guaranty and subordinated intercompany indebtedness documents and,
if applicable, security documents as may be reasonably required by the Lender and such
other opinions, agreements, documents, certificates or other items as may be required by
Section 4.3, such documents with respect to any additional Subsidiaries to be
substantially similar in form and substance to the Loan Documents executed on or about
the date hereof by the Subsidiaries parties hereto as of the Closing Date. No Domestic
Subsidiary may be a Subsidiary Borrower. Upon such execution, delivery and consent such
Subsidiary shall for all purposes be a party hereto as a Subsidiary Borrower as fully as
if it had executed and delivered this Agreement. So long as the principal of and interest
on any Credit Extensions made to any Subsidiary Borrower under this Agreement shall have
been repaid or paid in full, all Facility LCs issued for the account of such Subsidiary
Borrower have expired or been returned and terminated and all other obligations of such
Subsidiary Borrower under this Agreement shall have been fully performed, the Company
may, by not less than five (5) Business Days’ prior notice to the Lender, terminate
such Subsidiary Borrower’s status as a “Subsidiary Borrower.” 

        2.23    
Judgment Currency. If, for the purposes of obtaining judgment in any court, it is
necessary to convert a sum due from any Borrower hereunder in the currency expressed to
be payable herein (the “specified currency”) into another currency, the parties
hereto agree, to the fullest extent that they may effectively do so, that the rate of
exchange used shall be that at which in accordance with normal banking procedures the
Lender could purchase the specified currency with such other currency at the Lender’s
main office in Chicago, Illinois on the Business Day preceding that on which the final,
non-appealable judgment is given. The obligations of each Borrower in respect of any sum
due to the Lender hereunder shall, notwithstanding any judgment in a currency other than
the specified currency, be discharged only to the extent that on the Business Day
following receipt by the Lender of any sum adjudged to be so due in such other currency
the Lender may in accordance with normal, reasonable banking procedures purchase the
specified currency with such other currency. If the amount of the specified currency so
purchased is less than the sum originally due to the Lender in the specified currency,
each Borrower agrees, to the fullest extent that it may effectively do so, as a separate
obligation and notwithstanding any such judgment, to indemnify the Lender against such
loss, and if the amount of the specified currency so purchased exceeds the sum originally
due to the Lender in the specified currency, the Lender agrees to remit such excess to
such Borrower.  

29 

ARTICLE 3 

YIELD PROTECTION; TAXES  

        3.1     
Yield Protection. If, on or after the date of this Agreement, the adoption of any
law or any governmental or quasi-governmental rule, regulation, policy, guideline or
directive (whether or not having the force of law), or any change in any such law, rule,
regulation, policy, guideline or directive or in the interpretation or administration
thereof by any governmental or quasi-governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance by the
Lender or applicable Lending Installation or the LC Issuer with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency:  

	 	        3.1.1    
subjects the Lender or any applicable Lending Installation or the LC Issuer to any Taxes,
or changes the basis of taxation of payments (other than with respect to Excluded Taxes)
to the Lender or the LC Issuer in respect of its Eurocurrency Loans, Facility LCs or
participations therein, or  

	 	        3.1.2    
imposes or increases or deems applicable any reserve, assessment, insurance charge,
special deposit or similar requirement against assets of, deposits with or for the
account of, or credit extended by, the Lender or any applicable Lending Installation or
the LC Issuer (other than reserves and assessments taken into account in determining the
interest rate applicable to Eurocurrency Advances), or  

	 	        3.1.3    
imposes any other condition the result of which is to increase the cost to the Lender or
any applicable Lending Installation or the LC Issuer of making, funding or maintaining
its Eurocurrency Loans or Commitment (including, without limitation, any conversion of
any Loan denominated in an Agreed Currency other than euro into a Loan denominated in
euro), or of issuing Facility LCs, or reduces any amount receivable by the Lender or any
applicable Lending Installation or the LC Issuer in connection with its Eurocurrency
Loans or Commitment, Facility LCs or participations therein, or requires the Lender or
any applicable Lending Installation or the LC Issuer to make any payment calculated by
reference to the amount of Eurocurrency Loans or Commitment, Facility LCs or participants
therein held or interest of LC Fees received by it, by an amount deemed material by the
Lender or the LC Issuer, as the case may be, and the result of any of the foregoing is to
increase the cost to the Lender or applicable Lending Installation or the LC Issuer, as
the case may be, of making or maintaining its Eurocurrency Loans (including, without
limitation, any conversion of any Loan denominated in an Agreed Currency other than euro
into a Loan denominated in euro) or Commitment or of issuing Facility LCs or to reduce
the return received by the Lender or applicable Lending Installation or the LC Issuer, as
the case may be, in connection with such Eurocurrency Loans or Commitment, or Facility
LCs, then, within fifteen (15) days of demand by the Lender, the Borrowers shall pay the
Lender such additional amount or amounts as will compensate the Lender or the LC Issuer,
as the case may be, for such increased cost or reduction in amount received.  

30 

        3.2     
Changes in Capital Adequacy Regulations. If the Lender or the LC Issuer determines
the amount of capital required or expected to be maintained by the Lender, the LC Issuer,
any Lending Installation of the Lender or the LC Issuer, or any corporation controlling
the Lender or the LC Issuer, is increased as a result of a Change, then, within fifteen
(15) days of demand by the Lender or the LC Issuer, the Borrowers shall pay the Lender or
the LC Issuer the amount necessary to compensate for any shortfall in the rate of return
on the portion of such increased capital which the Lender or the LC Issuer determines is
attributable to this Agreement, its Outstanding Credit Exposure or its Commitment to make
Loans and issue Facility LCs, as the case may be, hereunder (after taking into account
the Lender’s or the LC Issuer’s policies as to capital adequacy). “Change” means
(i) any change after the date of this Agreement in the Risk-Based Capital Guidelines or
(ii) any adoption of, change in, or change in the interpretation or administration of any
other law, governmental or quasi-governmental rule, regulation, policy, guideline,
interpretation, or directive (whether or not having the force of law) after the date of
this Agreement which affects the amount of capital required or expected to be maintained
by the Lender or the LC Issuer or any Lending Installation or any corporation controlling
the Lender or the LC Issuer. “Risk-Based Capital Guidelines” means (i) the
risk-based capital guidelines in effect in the United States on the date of this
Agreement, including transition rules, and (ii) the corresponding capital regulations
promulgated by regulatory authorities outside the United States implementing the July
1988 report of the Basle Committee on Banking Regulation and Supervisory Practices
Entitled “International Convergence of Capital Measurements and Capital Standards,” including
transition rules, and any amendments to such regulations adopted prior to the date of
this Agreement.  

        3.3     
Availability of Types of Advances. If (x) the Lender determines that maintenance
of its Eurocurrency Loans at a suitable Lending Installation would violate any applicable
law, rule, regulation or directive, whether or not having the force of law, or (y) the
Lender determines that (i) deposits of a type, currency and maturity appropriate to match
fund Eurocurrency Advances are not available or (ii) the interest rate applicable to
Eurocurrency Advances does not accurately reflect the cost of making or maintaining
Eurocurrency Advances, then the Lender shall suspend the availability of Eurocurrency
Advances and require any affected Eurocurrency Advances to be repaid or converted to
Floating Rate Advances, subject to the payment of any funding indemnification amounts
required by Section 3.4.  

31 

        3.4     
Funding Indemnification. If any payment of a Eurocurrency Advance occurs on a date
which is not the last day of the applicable Interest Period, whether because of
acceleration, prepayment or otherwise, or a Eurocurrency Advance is not made on the date
specified by any Borrower for any reason other than default by the Lender, or a
Eurocurrency Advance is not prepaid on the date specified by the applicable Borrower for
any reason, the Borrowers will indemnify the Lender for any loss or cost incurred by it
resulting therefrom, including, without limitation, any loss or cost in liquidating or
employing deposits acquired to fund or maintain such Eurocurrency Advance.  

        3.5     
     Taxes. 

	 	        3.5.1    
All payments by the Borrowers to or for the account of the Lender or the LC Issuer or
under any Note or Facility LC Application shall be made free and clear of and without
deduction for any and all Taxes. If any Borrower shall be required by law to deduct any
Taxes from or in respect of any sum payable hereunder to the Lender or the LC Issuer, (a)
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
3.5) the Lender or the LC Issuer (as the case may be) receives an amount equal to the
sum it would have received had no such deductions been made, (b) such Borrower shall make
such deductions, (c) such Borrower shall pay the full amount deducted to the relevant
authority in accordance with applicable law and (d) such Borrower shall furnish to the
Lender the original copy of a receipt evidencing payment thereof within thirty (30) days
after such payment is made.  

	 	        3.5.2    
In addition, the Borrowers hereby agree to pay any present or future stamp or documentary
taxes and any other excise or property taxes, charges or similar levies which arise from
any payment made hereunder or under any Note or Facility LC Application or from the
execution or delivery of, or otherwise with respect to, this Agreement or any Note or
Facility LC Application (“Other Taxes”).  

	 	        3.5.3    
The Borrowers hereby agree to indemnify the Lender and the LC Issuer for the full amount
of Taxes or Other Taxes (including, without limitation, any Taxes or Other Taxes imposed
on amounts payable under this Section 3.5) paid by the LC Issuer or the Lender and
any liability (including penalties, interest and expenses) arising therefrom or with
respect thereto. Payments due under this indemnification shall be made within thirty (30)
days of the date the LC Issuer or the Lender makes demand therefor pursuant to Section
3.6.  

	 	        3.5.4    
If the Lender is entitled to an exemption from or reduction of withholding tax with
respect to payments under this Agreement or any Note pursuant to the law of any relevant
jurisdiction or any treaty, it shall deliver to the Company at the time or times
prescribed by applicable law, such properly completed and executed documentation
prescribed by applicable law as will permit such payments to be made without withholding
or at a reduced rate.  

        3.6     
Lender Statements; Survival of Indemnity. To the extent reasonably possible, the
Lender shall designate an alternate Lending Installation with respect to its Eurocurrency
Loans to reduce any liability of the Borrowers to the Lender under Sections 3.1, 3.2 and
3.5 or to avoid the unavailability of Eurocurrency Advances under Section 3.3,
so long as such designation is not, in the judgment of the Lender, disadvantageous to the
Lender. The Lender shall deliver a written statement to the Company as to the amount due,
if any, under Sections 3.1, 3.2, 3.4 or 3.5; provided, that no Borrower
shall be obligated to pay any amount or amounts under Sections 3.1, 3.2, 3.4 or 3.5in
respect of which an officer of the Lender responsible for the administration of this
Agreement shall have had actual knowledge for more than 180 days prior to the date of
such statement. Such written statement shall set forth in reasonable detail the
calculations upon which the Lender determined such amount and shall be final, conclusive
and binding on the Borrowers in the absence of manifest error. Determination of amounts
payable under such Sections in connection with a Eurocurrency Loan shall be calculated as
though the Lender funded its Eurocurrency Loan through the purchase of a deposit of the
type, currency and maturity corresponding to the deposit used as a reference in
determining the Eurocurrency Rate applicable to such Loan, whether in fact that is the
case or not. Unless otherwise provided herein, the amount specified in the written
statement of the Lender shall be payable on demand after receipt by the Company of such
written statement. The obligations of the Borrowers under Sections 3.1, 3.2, 3.4 and
3.5 shall survive payment of the Obligations and termination of this Agreement.  

32 

ARTICLE 4  

CONDITIONS PRECEDENT  

        4.1     
Initial Credit Extension. The Lender shall not be required to make the initial
Credit Extension hereunder unless (a) the representations and warranties contained in
Article V are true and correct as of such date and (b) the Company has furnished to the
Lender:  

	 	        4.1.1    
Copies of the articles or certificates of incorporation (or similar constitutive
documents) of the Company and each Guarantor (each a “Loan Party”), together
with all amendments thereto, and a certificate of active status or good standing, each
certified by the appropriate governmental officer in its jurisdiction of incorporation or
organization.  

	 	        4.1.2    
Copies, certified by the Secretary or Assistant Secretary of each Loan Party of its
by-laws (or similar constitutive documents) and of its Board of Directors’ resolutions
and of resolutions or actions of any other body authorizing the execution of the Loan
Documents to which it is a party.  

	 	        4.1.3    
An incumbency certificate, executed by the Secretary or Assistant Secretary of each Loan
Party, which shall identify by name and title and bear the signatures of the Authorized
Officers and any other officers of such Loan Party authorized to sign the Loan Documents
to which it is a party and, in the case of the Borrowers, to request Loans hereunder,
upon which certificate the Lender shall be entitled to rely until informed of any change
in writing by the applicable Loan Party.  

	 	        4.1.4    
An opening compliance certificate in substantially the form of Exhibit B, signed
by the chief financial officer or treasurer of the Company, showing the calculations
necessary to determine compliance with this Agreement on the initial Credit Extension
Date and stating that on the initial Credit Extension Date no Default or Unmatured
Default has occurred and is continuing.  

33 

	 	        4.1.5    
A written opinion of each Borrower’s and each Guarantor’s counsel, in form and
substance satisfactory to the Lender in substantially the form of Exhibit A.  

	 	        4.1.6    
Any Note requested by the Lender pursuant to Section 2.14 payable to the order of
the Lender.  

	 	        4.1.7    
If the initial Credit Extension shall be the issuance of a Facility LC, a properly
completed Facility LC Application.  

	 	        4.1.8    
Written money transfer instructions, in substantially the form of Exhibit C,
addressed to the Lender and signed by an Authorized Officer, together with such other
related money transfer authorizations as the Lender may have reasonably requested.  

	 	        4.1.9    
Evidence satisfactory to the Lender that the Existing Credit Agreement shall have been or
shall simultaneously on the Closing Date be terminated (except for those provisions that
expressly survive the termination thereof) and all loans outstanding and other amounts
owed to the lenders or agents thereunder shall have been or shall simultaneously with the
initial Advance hereunder be paid in full.  

	 	        4.1.10    
Such other documents as the Lender or its counsel may have reasonably requested
including, without limitation, each document identified on the List of Closing Documents
attached hereto as Exhibit E.  

        4.2     
     Each  Credit  Extension.  The Lender  shall not be  required  to make any Credit
 Extension  unless on the applicable Credit Extension Date: 

	 	         

	 	        4.2.1    
   There exists no Default or Unmatured Default. 

	 	        4.2.2    
The representations and warranties contained in Article V are true and correct as of such
Credit Extension Date except to the extent any such representation or warranty is stated
to relate solely to an earlier date, in which case such representation or warranty shall
have been true and correct on and as of such earlier date.  

	 	        4.2.3    
The Available Commitment shall not be less than the aggregate face amount (plus accrued
interest, if any) of the outstanding short-term unsecured debt obligations (interest
bearing or discounted) of the Company or its Subsidiaries having maturities of 270 days
or less excluding in any case, Credit Extensions under this Agreement and borrowings by
Subsidiaries in currencies other than Dollars.  

	 	        4.2.4    
All legal matters incident to the making of such Credit Extension shall be satisfactory
to the Lender and its counsel.  

        Each
Borrowing Notice or request for issuance of a Facility LC, as the case may be, with
respect to each such Credit Extension shall constitute a representation and warranty by
the Borrowers that the conditions contained in Sections 4.2.1, 4.2.2 and
4.2.3 have been satisfied. 

34 

        4.3     
Initial Advance to Each New Subsidiary Borrower. The Lender shall not be required
to make a Credit Extension hereunder to a new Subsidiary Borrower added after the Closing
Date unless the Company has furnished or caused to be furnished to the Lender:  

	 	        4.3.1    
The Assumption Letter executed and delivered by such Subsidiary Borrower and containing
the written consent of the Borrowers, as contemplated by Section 2.22.  

	 	        4.3.2    
Copies, certified by the Secretary, Assistant Secretary, Director or Authorized Officer
of the Subsidiary Borrower, of its Board of Directors’ resolutions (and/or
resolutions of other bodies, if any are deemed necessary by the Lender) approving the
Assumption Letter.  

	 	        4.3.3    
An incumbency certificate, executed by the Secretary, Assistant Secretary, Director or
Authorized Officer of the Subsidiary Borrower, which shall identify by name and title and
bear the signature of the officers of such Subsidiary Borrower authorized to sign the
Assumption Letter and the other documents to be executed and delivered by such Subsidiary
Borrower hereunder, upon which certificate the Lender shall be entitled to rely until
informed of any change in writing by the Company.  

	 	        4.3.4    
An opinion of counsel to such Subsidiary Borrower, substantially in the form of Exhibit
A hereto.  

	 	        4.3.5    
Guaranty documentation from each Guarantor that is a Domestic Subsidiary in form and
substance acceptable to the Lender as required pursuant to Section 6.10.  

	 	        4.3.6    
With respect to the initial Credit Extension made to any Subsidiary Borrower that is a
Foreign Subsidiary, the Lender shall have received originals and/or copies, as
applicable, of all filings required to be made and such other evidence as the Lender may
require establishing to the Lender’s satisfaction that the Lender and the LC Issuer
is entitled to receive payments under the Loan Documents without deduction or withholding
of any taxes or with such deductions and withholding of taxes as may be acceptable to the
Lender, including, without limitation, English taxes;.  

	 	        4.3.7    
With respect to each such Subsidiary Borrower that is a Foreign Subsidiary, evidence
reasonably satisfactory to the Lender that such Subsidiary Borrower has appointed an
agent for service of process in the State of Illinois.  

ARTICLE 5  

REPRESENTATIONS AND
WARRANTIES  

        The
Company represents and warrants as follows to the Lender as of the Closing Date, on the
date of the initial Loans hereunder (if different from the Closing Date) and thereafter
on each date as required by Section 4.2:  

        5.1     
Existence and Standing. The Company and each of its Subsidiaries is a corporation,
partnership or limited liability company duly and properly incorporated or organized, as
the case may be, validly existing and (to the extent such concept applies to such entity)
in active status or good standing under the laws of its jurisdiction of incorporation or
organization and has all requisite authority to conduct its business in each jurisdiction
in which its business is conducted, except to the extent that the failure to have such
authority could not reasonably be expected to have a Material Adverse Effect.  

35 

        5.2     
Authorization and Validity. The Company and each of its Subsidiaries (to the
extent applicable) has the power and authority and legal right to execute and deliver the
Loan Documents to which it is a party and to perform its obligations thereunder. The
execution and delivery by the Company and any such Subsidiary of the Loan Documents to
which it is a party and the performance of its obligations thereunder have been duly
authorized by proper corporate proceedings, and the Loan Documents to which such entity
is a party constitute legal, valid and binding obligations of such entity enforceable
against such entity in accordance with their terms, except as enforceability may be
limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights
generally.  

        5.3     
No Conflict; Government Consent. Neither the execution and delivery by the Company
or any of its Subsidiaries of the Loan Documents, nor the consummation of the
transactions therein contemplated, nor compliance with the provisions thereof will
violate (i) any law, rule, regulation, order, writ, judgment, injunction, decree or award
binding on the Company or any of its Subsidiaries or (ii) the Company’s or any
Subsidiary’s articles or certificate of incorporation, partnership agreement,
certificate of partnership, articles or certificate of organization, by-laws, or
operating agreement or other management agreement, as the case may be, or (iii) the
provisions of any indenture, instrument or agreement to which the Company or any of its
Subsidiaries is a party or is subject, or by which it, or its Property, is bound, or
conflict with, or constitute a default under, or result in, or require, the creation or
imposition of any Lien in, of or on the Property of the Company or a Subsidiary pursuant
to the terms of, any such indenture, instrument or agreement. No order, consent,
adjudication, approval, license, authorization, or validation of, or filing, recording or
registration with, or exemption by, or other action in respect of any governmental or
public body or authority, or any subdivision thereof, which has not been obtained by the
Company or any of its Subsidiaries, is required to be obtained by the Company or any of
its Subsidiaries in connection with the execution and delivery of the Loan Documents, the
borrowings under this Agreement, the payment and performance by any Borrower of the
Obligations or the legality, validity, binding effect or enforceability of any of the
Loan Documents.  

        5.4     
Financial Statements. The June 30, 2004 consolidated financial statements of the
Company and its Subsidiaries heretofore delivered to the Lender, copies of which are
attached hereto as Schedule 5.4, were prepared in accordance with generally
accepted accounting principles in effect on the date such statements were prepared and
fairly present, the consolidated financial condition and operations of the Company and
its Subsidiaries at such date and the consolidated results of their operations and cash
flows for the fiscal quarter then ended.  

        5.5     
Material Adverse Change. Since June 30, 2004 there has been no change in the
business, Property, condition (financial or otherwise) operations, performance or
prospects of any Borrower, or the Company and its Subsidiaries taken as a whole, which
could reasonably be expected to have a Material Adverse Effect.  

36 

        5.6     
Taxes. The Company and its Subsidiaries have filed all United States federal tax
returns and all other tax returns which are required to be filed and have paid all taxes
due pursuant to said returns or pursuant to any assessment received by the Company or any
of its Subsidiaries, except such taxes, if any, as are being contested in good faith and
as to which adequate reserves have been provided in accordance with Agreement Accounting
Principles. The United States income tax returns of the Company and its Subsidiaries have
been audited by the IRS through the fiscal year ended September 30, 1994. No tax liens
have been filed and no claims are being asserted with respect to any such taxes. The
charges, accruals and reserves on the books of the Company and its Subsidiaries in
respect of any taxes or other governmental charges are adequate.  

        5.7     
Litigation and Contingent Obligations. Except as disclosed on Schedule 5.7,
there is no litigation, arbitration, governmental investigation, proceeding or inquiry
pending or, to the knowledge of any of their officers, threatened against or affecting
the Company or any of its Subsidiaries which could reasonably be expected to have a
Material Adverse Effect or which seeks to prevent, enjoin or delay the making of any
Loans. Other than any liability incident to any litigation, arbitration or proceeding
which could not reasonably be expected to have a Material Adverse Effect, neither the
Company nor any of its Subsidiaries have any contingent obligations not provided for or
disclosed in the financial statements referred to in Section 5.4.  

        5.8     
Subsidiaries. Schedule 5.8 (as supplemented from time to time by the
Company promptly after the formation or acquisition of any new Subsidiary as permitted
under this Agreement) contains an accurate list of all Subsidiaries of the Company as of
the date of this Agreement, setting forth their respective jurisdictions of organization
and the percentage of their respective capital stock or other ownership interests owned
by the Company or other Subsidiaries. All of the issued and outstanding shares of capital
stock or other ownership interests of such Subsidiaries 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.  

        5.9     
Accuracy of Information. No information, schedule, exhibit or report furnished by
the Company or any of its Subsidiaries to the Lender in connection with the negotiation
of, or compliance with, the Loan Documents contained any material misstatement of fact or
omitted to state a material fact or any fact necessary to make the statements contained
therein not misleading.  

        5.10    
Regulation U. Neither the Company nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending credit
for the purpose, whether immediate, incidental or ultimate of buying or carrying margin
stock (within the meaning of Regulations U or X); and after applying the proceeds of each
Advance, margin stock (as defined in Regulation U) constitutes less than twenty-five
(25%) of the value of those assets of the Company and its Subsidiaries which are subject
to any limitation on sale or pledge, or any other restriction hereunder.  

        5.11    
Material Agreements. Neither the Company nor any Subsidiary is a party to any
agreement or instrument or subject to any charter or other corporate restriction which
could reasonably be expected to have a Material Adverse Effect. Neither the Company nor
any Subsidiary is in default in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in (i) any agreement to which it is a
party, which default could reasonably be expected to have a Material Adverse Effect or
(ii) any agreement or instrument evidencing or governing Indebtedness.  

37 

        5.12    
Compliance With Laws. The Company and its Subsidiaries have complied in all
material respects with all applicable statutes, rules, regulations, orders and
restrictions of any domestic or foreign government or any instrumentality or agency
thereof having jurisdiction over the conduct of their respective businesses or the
ownership of their respective Property.  

        5.13    
Ownership of Properties. On the date of this Agreement, the Company and its
Subsidiaries will have good title, free of all Liens other than those permitted by Section
6.16, to all of the Property and assets reflected in the Company’s most recent
consolidated financial statements provided to the Lender as owned by the Company and its
Subsidiaries, other than Property an assets sold or otherwise disposed of in the ordinary
course of business.  

        5.14    
ERISA; Foreign Pension Matters. The Company and all ERISA Affiliates, and Plan
fiduciaries indemnified by them who are employees of the Company or an ERISA Affiliate
have complied with the responsibilities, obligations, and duties imposed upon them by
ERISA and the IRC and the rules and regulations promulgated thereunder with respect to
any Plan, where the failure so to comply might be reasonably expected materially to
adversely affect the ability of the Company and its ERISA Affiliates, taken as a whole,
to carry on business substantially as now being or heretofore conducted, or to materially
adversely affect the financial condition of the Company and its ERISA Affiliates taken as
whole. Except as disclosed in Schedule 5.14 neither the Company nor any ERISA
Affiliate maintains or contributes to any employee welfare benefit plan within the
meaning of Section 3(l) of ERISA which provides benefits to employees after termination
of employment other than as required by Section 601 of ERISA. No Benefit Plan has
incurred any accumulated funding deficiency (as defined in Sections 302 (a)(2) of ERISA
or 412(a) of the IRC) whether or not waived. Neither the Company nor any ERISA Affiliate
has taken or failed to take any action which would constitute or result in a Termination
Event which might be reasonably expected materially to adversely affect the ability of
the Company and its ERISA Affiliates, taken as a whole, to carry on business
substantially as now being or heretofore conducted, or to materially adversely affect the
financial condition of the Company and its ERISA Affiliates taken as a whole. Neither the
Company nor any ERISA Affiliate has incurred with respect to any Benefit Plan liability
to the PBGC or any Multiemployer Plan under Title IV of ERISA which remains outstanding
other than the payment of premiums to the PBGC, and there are no premium payments which
have become due which are unpaid. Neither the Company nor any ERISA Affiliate has failed
to make a required contribution or payment to a Multiemployer Plan. Neither the Company
nor any ERISA Affiliate has failed to make a required installment or any other required
payment under Section 412 of the IRC on or before the due date for such installment or
other payment. Neither the Company nor any ERISA Affiliate is required to provide
security to a Benefit Plan under Section 401(a) (29) of the IRC due to a Plan amendment
that results in an increase in current liability for the plan year. The present value of
the aggregate unfunded liabilities to provide the accrued benefits under all Foreign
Pension Plans do not in the aggregate exceed an amount equal to five percent (5%) of the
fair market value of the assets held in trust or other funding vehicles for accrued
benefits under all Foreign Pension Plans. Each Foreign Pension Plan complies in all
material respects with all applicable requirements of law and regulations.  

38 

        5.15    
Plan Assets; Prohibited Transactions. No Borrower is an entity deemed to hold
“plan assets” within the meaning of 29 C.F.R. ss. 2510.3-101 of an employee
benefit plan (as defined in Section 3(3) of ERISA) which is subject to Title I of ERISA
or any plan (within the meaning of Section 4975 of the Code), and neither the execution
of this Agreement nor the making of Loans hereunder gives rise to a prohibited
transaction within the meaning of Section 406 of ERISA or Section 4975 of the Code.  

        5.16    
Environmental Matters.  

5.16.1 In the ordinary course of its
business, the officers of the Company consider the effect of Environmental Laws on the
business of the Company and its Subsidiaries, in the course of which they identify and
evaluate potential risks and liabilities accruing to the Company and its Subsidiaries due
to Environmental Laws. On the basis of this consideration, the Company has concluded that
Environmental Laws cannot reasonably be expected to have a Material Adverse Effect. Except
as set forth on Schedule 5.16, neither the Company nor any Subsidiary has received
any notice to the effect that its operations are not in compliance with any of the
requirements of applicable Environmental Laws or are the subject of any federal or state
investigation evaluating whether any remedial action is needed to respond to a release of
any toxic or hazardous waste or substance into the environment, which non-compliance or
remedial action could reasonably be expected to have a Material Adverse Effect. 

5.16.2 The Company and each of its
Subsidiaries have obtained all necessary governmental permits, licenses and approvals
which are material to the operations conducted on their respective properties, including
without limitation, all required permits, licenses and approvals for (i) the emission of
air pollutants or contaminates, (ii) the treatment or pretreatment and discharge of waste
water or storm water, (iii) the treatment, storage, disposal or generation of hazardous
wastes, (iv) the withdrawal and usage of ground water or surface water, and (v) the
disposal of solid wastes, except where a failure to obtain such permits, licenses and
approvals would not result in a Material Adverse Effect. 

        5.17    
Investment Company Act. Neither the Company nor any Subsidiary is an “investment
company” or a company “controlled” by an “investment company,” within
the meaning of the Investment Company Act of 1940, as amended.  

        5.18    
Public Utility Holding Company Act. Neither the Company nor any Subsidiary is a
“holding company”or a “subsidiary company” of a “holding company,” or
an “affiliate” of a “holding company” or of a “subsidiary company” of
a “holding company,” within the meaning of the Public Utility Holding Company
Act of 1935, as amended.  

        5.19    
Insurance. The Property of the Company and its Subsidiaries is insured with
financially sound and reputable insurance companies which are not Affiliates of the
Company, in such amounts, with such deductibles and covering such risks as are
customarily carried by companies engaged in similar business and owning similar
properties.  

39 

ARTICLE 6  

COVENANTS  

        During
the term of this Agreement, unless the Lender shall otherwise consent in writing:  

        6.1     
Reporting. The Company will maintain, for itself and each Subsidiary, a system of
accounting established and administered in accordance with generally accepted accounting
principles, and furnish to the Lender:  

	 	        6.1.1    
Within ninety (90) days after the close of each of its fiscal years, an unqualified audit
report certified by independent certified public accountants acceptable to the Lender,
prepared in accordance with Agreement Accounting Principles on a consolidated basis for
itself and its Subsidiaries, including a balance sheet as of the end of such period,
related statements of income, shareholders’ equity and cash flows, all certified as
accurate by its chief financial officer, chief accounting officer or treasurer.  

	 	        6.1.2    
Within forty-five (45) days after the close of the first three (3) quarterly periods of
each of its fiscal years, for itself and its Subsidiaries, a consolidated unaudited
balance sheet as at the close of each such period and consolidated statements of income,
shareholders’ equity and cash flows for the period from the beginning of such fiscal
year to the end of such quarter, all certified as accurate by its chief financial
officer, chief accounting officer or treasurer.  

	 	        6.1.3    
Together with the financial statements required under Sections 6.1.1 and 6.1.2,
a compliance certificate in substantially the form of Exhibit B signed by its chief
financial officer, chief accounting officer or treasurer showing the calculations
necessary to determine compliance with this Agreement and stating that no Default or
Unmatured Default exists, or if any Default or Unmatured Default exists, stating the
nature and status thereof.  

	 	        6.1.4    
Within forty-five (45) days (or ninety (90) days with respect to the fourth quarter)
after the end of each fiscal quarter of each fiscal year of the Company, a consolidating
“MD&A” of the Company and its Subsidiaries for the portion of such fiscal
year elapsed through the end of such fiscal quarter, prepared on a basis consistent with
the most recent such report of the Company dated on or about June 30, 2004 and certified
as accurate by an Authorized Officer.  

	 	        6.1.5    
Within ten (10) Business Days after the Company or any ERISA Affiliate knows or has
reason to know that a Termination Event has occurred which might be reasonably expected
materially to adversely affect the ability of the Company and its Subsidiaries, taken as
a whole, to carry on business substantially as now being or heretofore conducted, or to
materially adversely affect the financial condition of the Company and its Subsidiaries
taken as a whole, a written statement of an Authorized Officer describing such
Termination Event and the action, if any, which the Company or any ERISA Affiliate has
taken, is taking or proposes to take with respect thereto, and when known, any action
taken or threatened by the IRS, DOL, PBGC or a Multiemployer Plan with respect thereto.  

	 	        6.1.5.1    
Within ten (10) Business Days after the Company or any ERISA Affiliate knows or has
reason to know that a prohibited transaction (defined in Sections 406 of ERISA and 4975
of the IRC) has occurred, a statement of an Authorized Officer describing such
transaction and the action which the Company or any ERISA Affiliate has taken, is taking
or proposes to take with respect thereto.  

40 

	 	        6.1.5.2    
Within ten (10) Business Days after the filing thereof with the IRS, a copy of each
funding waiver request filed with respect to any Benefit Plan and all communications
received by the Company or any ERISA Affiliate with respect to such request.  

	 	        6.1.5.3    
Within ten (10) Business Days after receipt by the Company or any ERISA Affiliate of the
PBGC’s intention to terminate a Benefit Plan or to have a trustee appointed to
administer a Benefit Plan, which termination or appointment might be reasonably expected
materially to adversely affect the ability of the Company and its Subsidiaries, taken as
a whole, to carry on business substantially as now being or heretofore conducted, or to
materially adversely affect the financial condition of the Company and its Subsidiaries
taken as a whole, copies of each such notice.  

	 	        6.1.5.4    
Within ten (10) Business Days after receipt by the Company or any ERISA Affiliate of any
unfavorable determination letter from the IRS regarding the qualification of a Plan under
Section 401(a) of the IRC which might be reasonably expected materially to adversely
affect the ability of the Company and its Subsidiaries, taken as a whole, to carry on
business substantially as now being or heretofore conducted, or to materially adversely
affect the financial condition of the Company and its Subsidiaries taken as a whole,
copies of each such letter.  

	 	        6.1.5.5    
Within ten (10) Business Days after receipt by the Company or any ERISA Affiliate of a
notice from a Multiemployer Plan regarding the imposition of withdrawal liability which
liability might be reasonably expected materially to adversely affect the ability of the
Company and its Subsidiaries, taken as a whole, to carry on business substantially as now
being or heretofore conducted, or to materially adversely affect the financial condition
of the Company and its Subsidiaries taken as a whole, copies of each such notice.  

	 	        6.1.5.6    
Within ten (10) Business Days after the Company or any ERISA Affiliate fails to make a
required installment or any other required payment under Section 412 of the IRC on or
before the due date for such installment or payment which failure might be reasonably
expected materially to adversely affect the ability of the Company and its Subsidiaries,
taken as a whole, to carry on business substantially as now being or heretofore
conducted, or to materially adversely affect the financial condition of the Company and
its Subsidiaries taken as a whole, a notification of such failure.  

	 	        6.1.5.7    
Within ten (10) Business Days after the Company or any ERISA Affiliate knows or has
reason to know (a) a Multiemployer Plan has been terminated, (b) the administrator or
plan sponsor of a Multiemployer Plan intends to terminate a Multiemployer Plan, or (c)
the PBGC has instituted or will institute proceedings under Section 4042 of ERISA to
terminate a Multiemployer Plan, which termination or proceedings might be reasonably
expected materially to adversely affect the ability of the Company and its Subsidiaries,
taken as a whole, to carry on business substantially as now being or heretofore
conducted, or to materially adversely affect the financial condition of the Company and
its Subsidiaries taken as a whole.  

	 	        6.1.5.8    
As soon as possible and in any event within ten (10) days after the Company knows that
any material unfunded liability has arisen with respect to any Foreign Pension Plan, a
statement, signed by the chief financial officer or treasurer of the Company, describing
said material unfunded liability and the action which the Company proposes to take with
respect thereto.  

41 

	 	        6.1.5.9    
As soon as possible and in any event within ten (10) days after receipt by the Company, a
copy of (a) any notice or claim to the effect that the Company or any of its Subsidiaries
is or may be liable to any Person as a result of the release by the Company, any of its
Subsidiaries, or any other Person of any toxic or hazardous waste or substance into the
environment, and (b) any notice alleging any violation of any federal, state or local
environmental, health or safety law or regulation by the Company or any of its
Subsidiaries, which, in either case, could reasonably be expected to have a Material
Adverse Effect.  

	 	        6.1.5.10    
Promptly upon the furnishing thereof to the shareholders of the Company, copies of all
financial statements, reports and proxy statements so furnished.  

	 	        6.1.5.11    
Promptly upon the filing thereof, copies of all registration statements or other regular
reports not otherwise provided pursuant to this Section 6.1 which the Company or
any of its Subsidiaries files with the Securities and Exchange Commission.  

	 	        6.1.5.12    
Such other information (including non-financial information) as the Lender may from time
to time reasonably request.  

        For
purposes of this Section 6.1, the Company and any ERISA Affiliate shall be deemed
to know all facts known by the administrator of any Plan of which the Company or any ERISA
Affiliate is the plan sponsor. 

        6.2     
Use of Proceeds. The Company will, and will cause each Subsidiary to, use the
proceeds of the Credit Extensions for general corporate purposes, including for working
capital, refinancing the Indebtedness under the Existing Credit Agreement and Permitted
Acquisitions. The Borrowers shall use the proceeds of Credit Extensions in compliance
with all applicable legal and regulatory requirements and any such use shall not result
in a violation of any such requirements, including, without limitation, Regulations T, U
and X, the Securities Act of 1933 and the Securities Exchange Act of 1934 and the
regulations promulgated thereunder.  

        6.3     
Notice of Default. The Company will, and will cause each Subsidiary to, give
prompt notice in writing to the Lender of the occurrence of any Default or Unmatured
Default and of any other development, financial or otherwise, which could reasonably be
expected to have a Material Adverse Effect.  

        6.4     
Conduct of Business. The Company will, and will cause each Subsidiary to, carry on
and conduct its business in substantially the same manner and only in substantially the
same fields of enterprise as conducted by the Company or its Subsidiaries as of the
Closing Date, and, except as otherwise permitted by Section 6.13, do all things
necessary to remain duly incorporated or organized, validly existing and (to the extent
such concept applies to such entity) in active status or good standing as a corporation,
partnership or limited liability company in its jurisdiction of incorporation or
organization, as the case may be, and maintain all requisite authority to conduct its
business in each jurisdiction in which its business is conducted. Notwithstanding any
term herein to the contrary, the Company covenants and agrees that Uwatec USA, Inc. will
not own any assets or conduct any business operations from the Closing Date until and
including the Facility Termination Date.  

42 

        6.5     
Taxes. The Company will, and will cause each Subsidiary to, file on a timely basis
complete and correct United States federal and applicable foreign, state and local tax
returns required by law and pay when due all taxes, assessments and governmental charges
and levies upon it or its income, profits or Property, except those which are being
contested in good faith by appropriate proceedings and with respect to which adequate
reserves have been set aside in accordance with Agreement Accounting Principles.  

        6.6     
Insurance. The Company will, and will cause each Subsidiary to, maintain with
financially sound and reputable insurance companies insurance on their Property in such
amounts and covering such risks as is consistent with sound business practice, and the
Company will furnish to the Lender upon request full information as to the insurance
carried.  

        6.7     
Compliance with Laws; Maintenance of Plans. The Company will, and will cause each
Subsidiary to, (i) comply with all laws, rules, regulations, orders, writs, judgments,
injunctions, decrees or awards to which it may be subject including, without limitation,
all Environmental Laws, and (ii) establish, maintain and operate all Plans to comply in
all material respects with the provisions of ERISA and the IRC, and the regulations and
interpretations thereunder, where the failure to so comply might reasonably be expected
materially to impair the ability of the Company and the Subsidiaries, taken as a whole,
to carry on business substantially as now being conducted or to affect materially and
adversely the financial condition of the Company and the Subsidiaries, taken as a whole.  

        6.8     
Maintenance of Properties. The Company will, and will cause each Subsidiary to, do
all things necessary to maintain, preserve, protect and keep its Property in good repair,
working order and condition, and make all necessary and proper repairs, renewals and
replacements so that its business carried on in connection therewith may be properly
conducted at all times.  

        6.9     
Inspection; Keeping of Books and Records. The Company will, and will cause each
Subsidiary to, permit the Lender, by its representatives and agents, to inspect any of
the Property, books and financial records of the Company and each Subsidiary, to examine
and make copies of the books of accounts and other financial records of the Company and
each Subsidiary, and to discuss the affairs, finances and accounts of the Company and
each Subsidiary with, and to be advised as to the same by, their respective officers at
such reasonable times and intervals as the Lender may designate. The Company shall keep
and maintain, and cause each of its Subsidiaries to keep and maintain, in all material
respects, proper books of record and account in which entries in conformity with
Agreement Accounting Principles shall be made of all dealings and transactions in
relation to their respective businesses and activities. If a Default has occurred and is
continuing, the Company, upon the Lender’s request, shall turn over copies of any
such records to the Lender or its representatives.  

        6.10    
Addition of Guarantors. As promptly as possible but in any event within thirty
(30) days after any Domestic Subsidiary becomes a Subsidiary of the Company, the Company
shall cause each such Domestic Subsidiary to deliver to the Lender a duly executed
supplement to the Guaranty pursuant to which such Subsidiary agrees to be bound by the
terms and provisions of the Guaranty.  

43 

        6.11    
Dividends and Distributions. The Company will not, nor will it permit any of its
Subsidiaries to, declare or pay any dividends on its capital stock (other than dividends
payable in its own capital stock), make any distributions to any of its equity owners,
redeem, repurchase or otherwise acquire or retire any of its capital stock or other
equity interests at any time outstanding or pay any royalties to any Affiliate
(collectively, “Distributions”) other than:  

	 	        6.11.1    
Purchases, redemptions or retirements of the Company’s Capital Stock or any
warrants, rights or options to purchase or acquire any Capital Stock (i) in exchange for
or out of the net cash proceeds to the Company obtained within three (3) months of such
purchase, redemption or retirement from the issue or sale of other shares of Capital
Stock of the Company or warrants, rights or options to purchase or acquire any shares of
its Capital Stock, or (ii) that was sold, transferred or issued (a) as directors’ qualifying
shares of Capital Stock, (b) as any de minimus number of shares of Capital Stock to
foreign domiciliaries as may be required by law, or (c) in connection with any Permitted
Acquisition.  

	 	        6.11.2    
Repurchases of up to 50,000 shares of Capital Stock of the Company per year for use in
connection with employee stock option and other employee benefit plans.  

	 	        6.11.3    
Distributions by any Subsidiary of the Company to the Company or to a Wholly-Owned
Subsidiary of the Company.  

	 	        6.11.4    
Other Distributions, provided the aggregate amount of Distributions (excluding
Distributions pursuant to Section 6.11.2 and 6.11.3) made during the period
from and after June 30, 2004 to and including the date of the making of the Distribution
in question would not exceed the sum of (1) $10,000,000 plus (2) fifty percent (50%) of
Consolidated Net Income for such period, computed on a cumulative basis for said entire
period (or if such Consolidated Net Income is a deficit figure, then minus 100% of such
deficit).  

Distributions described in
Sections 6.11.1, 6.11.2 and 6.11.4 above shall not be permitted to be
made or declared at a time when a Default or Unmatured Default is continuing or would
result therefrom. 

        6.12    
Indebtedness. The Company will not, nor will it permit any Subsidiary to, create,
incur or suffer to exist any Indebtedness, except:  

	 	        6.12.1    
  The Loans and any other Obligations hereunder. 

	 	        6.12.2    
Indebtedness existing on the date hereof and described on Schedule 6.12, and
Permitted Refinancing Indebtedness in respect thereof.  

	 	        6.12.3    
Indebtedness owed (a) to the Company by any Guarantor, (b) to any Guarantor by the
Company or any other Guarantor, (c) to any Subsidiary of the Company that is not a
Guarantor by any other Subsidiary of the Company that is not a Guarantor, and (d) to the
Company or any Guarantor by any Subsidiary of the Company that is not a Guarantor
existing as of the date hereof and described on Schedule 6.12.  

44 

	 	        6.12.4    
Indebtedness constituting (a) accounts payable of the Company and its Subsidiaries
arising in the ordinary course of business payable on terms customary in the trade and
consistent with past practice, (b) payroll accruals, (c) tax, assessments and other
governmental charges which are not yet due or which are being contested in good faith by
appropriate proceedings and with respect to which adequate reserves have been set aside
in accordance with Agreement Accounting Principles, and (d) other similar unsecured
Indebtedness incurred in the ordinary course of business and consistent with past
practice, but not incurred through the borrowing of money or the obtaining of credit.  

	 	        6.12.5    
Indebtedness in connection with overdraft facilities in an aggregate outstanding
principal amount not to exceed $10,000,000.  

	 	        6.12.6    
Indebtedness evidenced by letters of credit (other than Facility LCs) in an aggregate
face amount not to exceed $10,000,000 at any time.  

	 	        6.12.7    
So long as the Company shall have prepaid the outstanding Obligations in accordance with
Section 2.8.2, additional unsecured Indebtedness in an aggregate amount not to
exceed $50,000,000.  

        6.13    
Merger. The Company will not, nor will it permit any Subsidiary to, merge or
consolidate with or into any other Person, except that, if after giving effect to any
such merger or consolidation no Default or Unmatured Default would exist, a Subsidiary
may merge or consolidate (i) into the Company or a Wholly-Owned Subsidiary such that the
Company or such Wholly-Owned Subsidiary is the surviving entity, provided that in any
merger or consolidation involving a Domestic Subsidiary and a Foreign Subsidiary, the
Domestic Subsidiary shall be the surviving entity, or (ii) in connection with a Permitted
Acquisition.  

        6.14    
Sale of Assets. The Company will not, nor will it permit any Subsidiary to, lease,
sell, transfer or otherwise dispose of its Property to any other Person, except:  

	 	        6.14.1    
  Sales of inventory and obsolete or excess assets in the ordinary course of business. 

	 	        6.14.2    
Sales, leases and transfers of Property (a) from the Company to any Guarantor, and (b)
from any Subsidiary of the Company to the Company or any Guarantor.  

	 	        6.14.3    
Sales, transfers or issuances of Capital Stock, warrants, rights or options to purchase
or otherwise acquire Capital Stock, or other securities exchangeable for or convertible
into Capital Stock, of any Subsidiary (a) constituting directors’ qualifying shares
of Capital Stock, (b) constituting any de minimus number of shares of Capital Stock to
foreign domiciliaries as may be required by law, (c) in connection with any Permitted
Acquisition or (d) to employees of any Subsidiary as part of any incentive stock
arrangement (other than in connection with a Permitted Acquisition) so long as, after
giving effect to such issuance under this clause (d), (1) no Subsidiary shall cease to be
a Subsidiary and (2) the aggregate fair value (as determined in good faith at the time of
such issuance by the Board of Directors of the Company or such person or committee as the
Board of Directors of the Company may authorize to make such determination pursuant to
the terms of any such incentive stock arrangement) of all such Capital Stock under this
clause (d) shall not exceed $2,000,000.  

45 

	 	        6.14.4    
Sales, assignments, transfers, leases, conveyances or other dispositions of its Property
and other assets if such transaction (a) is for consideration consisting at least
eighty-five percent (85%) of cash, (b) is for not less than fair market value (as
determined in good faith by the Company’s board of directors), (c) after giving
effect to such sale, lease, transfer or disposal, no Default or Unmatured Default shall
exist, and (d) together with all other Property of the Company and its Subsidiaries
previously leased, sold or disposed of (other than inventory and obsolete or excess
assets in the ordinary course of business) calculated at book value (1) during the
immediately preceding twelve-month period, represents the disposition of (A) not greater
than twenty percent (20%) of the Company’s Consolidated Total Assets at the end of
the fiscal year immediately preceding that in which such transaction is proposed to be
entered into and (B) assets that contributed not greater than twenty percent (20%) of the
Company’s Consolidated Net Income for such preceding fiscal year, and (2) during the
period from the Closing Date to the date of such proposed transaction, represents the
disposition of (A) not greater than thirty-five percent (35%) of the Company’s
Consolidated Total Assets at the end of the fiscal year immediately preceding that in
which such transaction is proposed to be entered into and (B) assets that contributed not
greater than thirty-five percent (35%) of the Company’s Consolidated Net Income for
such preceding fiscal year.  

        6.15    
Investments and Acquisitions. The Company will not, nor will it permit any
Subsidiary to, make or suffer to exist any Investments (including without limitation,
loans and advances to, and other Investments in, Subsidiaries), or commitments therefor,
or to create any Subsidiary or to become or remain a partner in any partnership or joint
venture, or to make any Acquisition, except:  

	 	        6.15.1    
Cash Equivalent Investments.  

	 	        6.15.2    
Existing Investments in Subsidiaries and other Investments in existence on the date
hereof and described in Schedule 6.15.  

	 	        6.15.3    
Investments (a) by any Subsidiary in the Company or any Guarantor and (b) constituting
Indebtedness permitted under Section 6.12.3.  

	 	        6.15.4    
Investments resulting from Financial Contracts entered into in the ordinary course of
business and which do not violate the terms of Section 6.18.  

	 	        6.15.5    
Acquisitions meeting the following requirements or otherwise approved by the Required
Lenders (each such Acquisition constituting a “Permitted Acquisition”):  

	 	        6.15.5.1    
as of the date of the consummation of such Acquisition, no Default or Unmatured Default
shall have occurred and be continuing or would result from such Acquisition, and the
representation and warranty contained in Section 5.10 shall be true both before
and after giving effect to such Acquisition;  

	 	        6.15.5.2    
such Acquisition is consummated on a non-hostile basis pursuant to a negotiated
acquisition agreement approved by the board of directors or other applicable governing
body of the seller or entity to be acquired, and no material challenge to such
Acquisition (excluding the exercise of appraisal rights) shall be pending or threatened
by any shareholder or director of the seller or entity to be acquired;  

46 

	 	        6.15.5.3    
the business to be acquired in such Acquisition is similar or related to one or more of
the lines of business in which the Company and its Subsidiaries are engaged on the
Closing Date;  

	 	        6.15.5.4    
as of the date of the consummation of such Acquisition, all material approvals required
in connection therewith shall have been obtained and the Company shall be in compliance
with Section 6.10;  

	 	        6.15.5.5    
the Purchase Price for the Acquisition shall (1) at any time the Leverage Ratio shall be
greater than or equal to 3.00 to 1.00, not exceed an amount equal to (A) $10,000,000 per
transaction or (B) together with all other Permitted Acquisitions permitted under this Section
6.15.5, $15,000,000 per year, (2) at any time the Leverage Ratio shall be greater
than or equal to 2.50 to 1.00 but less than 3.00 to 1.00, not exceed an amount equal to
(A) $15,000,000 per transaction or (B) together with all other Permitted Acquisitions
permitted under this Section 6.15.5, $30,000,000 per year, in each case, including
the incurrence or assumption of any Indebtedness in connection therewith, and, for
purposes of this Section 6.15.5.5, Leverage Ratio shall be determined as of the
last day of the most recent fiscal quarter for which a compliance certificate shall have
been delivered in accordance with Section 6.1, and (3) at any other time, not be
subject to any limitation under this Section 6.15.5.5; and  

	 	        6.15.5.6    
with respect to each Permitted Acquisition with respect to which the Purchase Price shall
be greater than $2,000,000, not less than ten (10) days prior to the consummation of such
Permitted Acquisition, the Company shall have delivered to the Lender, in form and
substance reasonably satisfactory to the Lender, a pro forma consolidated balance sheet,
income statement and cash flow statement of the Company and its Subsidiaries (the “Acquisition
Pro Forma”), based on the Company’s most recent financial statements delivered
pursuant to Section 6.1.1 and using historical financial statements for the
acquired entity provided by the seller(s) or which shall be complete and shall fairly
present, in all material respects, the financial condition and results of operations and
cash flows of the Company and its Subsidiaries in accordance with Agreement Accounting
Principles, but taking into account such Permitted Acquisition and the funding of all
Credit Extensions in connection therewith, and such Acquisition Pro Forma shall reflect
that, on a pro forma basis, the Company would have been in compliance with the financial
covenants set forth in Section 6.21 for the four fiscal quarter period reflected
in the compliance certificate most recently delivered to the Lender pursuant to Section
6.1.3 prior to the consummation of such Permitted Acquisition (giving effect to such
Permitted Acquisition and all Credit Extensions funded in connection therewith as if made
on the first day of such period).  

	 	        6.15.5.7    
Investments consisting of loans or advances made by the Company or any of its
Subsidiaries to employees and officers of the Company or any of the Company’s
Subsidiaries for travel, entertainment and relocation expenses in the ordinary course of
business in an aggregate principal amount outstanding at any one time not to exceed
$2,000,000.  

	 	        6.15.5.8    
Investments consisting of receivables arising from the sale of goods and services in the
ordinary course of business of the Company and its Subsidiaries.  

47 

	 	        6.15.5.9    
Investments not otherwise permitted by Section 6.15.5.1 through Section 6.15.5.8,
above, provided that at the time such Investment is made, (a) the Purchase Price of all
Investments made pursuant to this Section 6.15.5.9 (including such Investment) in
the aggregate shall not exceed twenty-five percent (25%) of Consolidated Tangible Net
Worth as of the end of the fiscal quarter ending immediately prior to the fiscal quarter
in which such Investment is made and (b) no Default or Unmatured Default is continuing or
would result therefrom.  

        6.16    
Liens. The Company will not, nor will it permit any Subsidiary to, create, incur,
or suffer to exist any Lien in, of or on the Property of the Company or any of its
Subsidiaries, except:  

	 	        6.16.1.1    
Liens for taxes, assessments or governmental charges or levies on its Property if the
same shall not at the time be delinquent or thereafter can be paid without penalty, or
are being contested in good faith and by appropriate proceedings and for which adequate
reserves in accordance with Agreement Accounting Principles shall have been set aside on
its books.  

	 	        6.16.1.2    
Liens imposed by law, such as carriers’, warehousemen’s and mechanics’ liens
and other similar liens arising in the ordinary course of business which secure payment
of obligations not more than sixty (60) days past due or which are being contested in
good faith by appropriate proceedings and for which adequate reserves in accordance with
Agreement Accounting Principles shall have been set aside on its books.  

	 	        6.16.1.3    
Liens arising out of pledges or deposits under worker’s compensation laws,
unemployment insurance, old age pensions, or other social security or retirement
benefits, or similar legislation.  

	 	        6.16.1.4    
Utility easements, building restrictions and such other encumbrances or charges against
real property as are of a nature generally existing with respect to properties of a
similar character and which do not in any material way affect the marketability of the
same or interfere with the use thereof in the business of the Company or its
Subsidiaries.  

	 	        6.16.1.5    
Liens existing on the date hereof and described on Schedule 6.16.  

	 	        6.16.1.6    
Liens, if any, securing the Loans and other Obligations hereunder.  

        6.17    
Transactions with Affiliates. The Company will not, and will not permit any
Subsidiary to, enter into any transaction (including, without limitation, the purchase or
sale of any Property or service) with, or make any payment or transfer to, any Affiliate
except in the ordinary course of business and pursuant to the reasonable requirements of
the Company’s or such Subsidiary’s business and upon fair and reasonable terms
no less favorable to the Company or such Subsidiary than the Company or such Subsidiary
would obtain in a comparable arm’s-length transaction.  

48 

        6.18    
Financial Contracts. The Company shall not and shall not permit any of its
consolidated Subsidiaries to enter into any Financial Contract, other than Financial
Contracts pursuant to which the Company or such Subsidiary hedged its actual or
anticipated interest rate, foreign currency or commodity exposure existing or anticipated
at the time thereof.  

        6.19    
ERISA. Except to the extent that such act, or failure to act would not result
singly, or in the aggregate, after taking into account all other such acts or failures to
act, in a liability which might be reasonably expected materially to adversely affect the
ability of the Company and its ERISA Affiliates, taken as a whole, to carry on business
substantially as now being or heretofore conducted, or to materially adversely affect the
financial condition of the Company and its ERISA Affiliates taken as a whole, (i) engage,
or permit any ERISA Affiliate to engage, in any prohibited transaction described in
Sections 406 of ERISA or 4975 of the IRC for which a statutory or class exemption is not
available or a private exemption has not been previously obtained from the DOL; (ii)
permit to exist any accumulated funding deficiency (as defined in Sections 302 of ERISA
and 412 of the IRC); (iii) fail, or permit any ERISA Affiliate to fail, to pay timely
required contributions or annual installments due with respect to any waived funding
deficiency of any Benefit Plan; (iv) terminate, or permit any ERISA Affiliate to
terminate, any Benefit Plan which would result in any liability of the Company or any
ERISA Affiliate under Title IV of ERISA; (v) fail to make any contribution or payment to
any Multiemployer Plan which the Company or any ERISA Affiliate may be required to make
under any agreement relating to such Multiemployer Plan, or any law pertaining thereto;
(vi) fail, or permit any ERISA Affiliate to fail, to pay any required installment or any
other payment required under Section 412 of the IRC on or before the due date for such
installment or other payment; (vii) amend, or permit any ERISA Affiliate to amend, a
Benefit Plan resulting in an increase in current liability for the plan year such that
the Company or any ERISA Affiliate is required to provide security to such Plan under
Section 401(a)(29) of the IRC.  

        6.20    
Environmental Compliance. The Company will not become, or permit any Subsidiary to
become, subject to any liabilities or costs which might be reasonably expected materially
to adversely affect the ability of the Company and its Subsidiaries, taken as a whole, to
carry on business substantially as now being or heretofore conducted, or to materially
adversely affect the financial condition of the Company and its Subsidiaries taken as a
whole, arising out of or related to (i) the release or threatened release at any location
of any contaminant into the environment, or any remedial action in response thereto, or
(ii) any violation of any environmental, health or safety requirements of law (including,
without limitation, any Environmental Laws).  

        6.21    
Financial Covenants.  

	 	        6.21.1    
Maximum Leverage Ratio. As of the last day of each fiscal quarter, the Company and
its consolidated Subsidiaries shall not permit the ratio (the “Leverage Ratio”)
of (i) Total Funded Debt to (ii) EBITDA of the Company and its Subsidiaries as at the end
of and for any period of four consecutive fiscal quarters ending to be greater than 3.50
to 1.00 for the period ending on or about September 30, 2004 and thereafter. The Leverage
Ratio shall be calculated, in each case, determined as of the last day of each fiscal
quarter based upon (a) for Total Funded Debt, the average month-end Total Funded Debt for
the twelve-month period ending as of the last day of each such fiscal quarter; and (b)
for EBITDA, the actual amount for the four-quarter period ending on such day, calculated,
with respect to Permitted Acquisitions, on a pro forma basis using historical audited and
reviewed unaudited financial statements obtained from the seller(s) in such Permitted
Acquisition, broken down by fiscal quarter in the Company’s reasonable judgment and
reasonably satisfactory to the Lender and as reported to the Lender pursuant to the
provisions of Section 6.15.5 

49 

	 	        6.21.2    
Minimum Fixed Charge Coverage Ratio. The Company and its consolidated Subsidiaries
shall not permit the ratio (“Fixed Charge Coverage Ratio”), without
duplication, of (i) the sum of (a) EBITDA for such period, plus (b) Rentals for such
period, to (ii) the sum of (a) cash Interest Expense during such period, plus (b) Rentals
for such period, as at the end of and for any period of four consecutive fiscal quarters
ending, to be less than 1.75 to 1.00 for the period ending on or about September 30, 2004
and thereafter. The Fixed Charge Coverage Ratio shall be determined as of the last day of
each fiscal quarter based upon, for all components thereof, the actual amount for the
four-quarter period ending on such day, calculated, with respect to Permitted
Acquisitions, on a pro forma basis using historical audited and reviewed unaudited
financial statements obtained from the seller(s) in such Permitted Acquisition, broken
down by fiscal quarter in the Company’s reasonable judgment and reasonably
satisfactory to the Lender and as reported to the Lender pursuant to the provisions of Section
6.15.5.  

	 	        6.21.3    
Minimum Consolidated Net Worth. The Company shall not permit its Consolidated Net
Worth at any time to be less than $126,500,000.  

ARTICLE 7  

DEFAULTS  

        The
occurrence of any one or more of the following events shall constitute a Default:  

        7.1     
Breach of Representations or Warranties. Any representation or warranty made or
deemed made by or on behalf of the Company or any of its Subsidiaries to the Lender under
or in connection with this Agreement, any Credit Extension, or any certificate or
information delivered in connection with this Agreement or any other Loan Document shall
be false in any material respect on the date as of which made.  

        7.2     
Failure to Make Payments When Due. Nonpayment of (i) principal of any Loan when
due, (ii) any Reimbursement Obligation within one (1) Business Day after the same becomes
due, or (iii) interest upon any Loan or any Commitment Fee, LC Fee or other Obligations
under any of the Loan Documents within five (5) Business Days after such interest, fee or
other Obligation becomes due.  

        7.3     
Breach of Covenants. The breach by any Borrower of any of the terms or provisions
of Section 6.3 or Sections 6.10 through 6.21; or the breach by any
Borrower of any of the other terms or provisions of Article VI which is not remedied
within five (5) Business Days after the occurrence thereof.  

        7.4     
Other Breaches. The breach by any Borrower (other than a breach which constitutes
a Default under another Section of this Article VII) of any of the terms or provisions of
this Agreement or any other Loan Document which is not remedied within thirty (30) days
after the earlier of (i) the date the applicable Borrower obtains knowledge thereof, or
(ii) the date written notice thereof shall have been given to the applicable Borrower by
the Lender.  

50 

        7.5     
Default as to Other Indebtedness.  

	 	        7.5.1    
Failure of the Company or any of its Subsidiaries to pay when due any Indebtedness which,
individually or in the aggregate exceeds $5,000,000 (or the Approximate Equivalent Amount
in currencies other than Dollars) (such Indebtedness being referred to as “Material
Indebtedness”); or  

	 	        7.5.2    
Any Material Indebtedness of the Company or any of its Subsidiaries shall be declared to
be due and payable or required to be prepaid or repurchased (other than by a regularly
scheduled payment) prior to the stated maturity thereof; or  

	 	        7.5.3    
The Company or any of its Subsidiaries shall fail to pay, or shall admit in writing its
inability to pay, its debts generally as they become due; or  

	 	        7.5.4    
The default by the Company or any of its Subsidiaries in the performance (beyond the
applicable grace period with respect thereto, if any) of any term, provision or condition
contained in any agreement under which any such Material Indebtedness was created or is
governed, or any other event shall occur or condition exist, the effect of which default
or event is to cause, or to permit the holder or holders of such Material Indebtedness to
cause such Material Indebtedness to become due prior to its stated maturity.  

        7.6     
Voluntary Bankruptcy; Appointment of Receiver; Etc. Any Borrower or any Guarantor
shall (i) have an order for relief entered with respect to it under the Federal
bankruptcy laws as now or hereafter in effect, (ii) make an assignment for the benefit of
creditors, (iii) apply for, seek, consent to, or acquiesce in, the appointment of a
receiver, custodian, trustee, examiner, liquidator or similar official for it or any
Substantial Portion of its Property, (iv) institute any proceeding seeking an order for
relief under the Federal bankruptcy laws as now or hereafter in effect or seeking to
adjudicate it a bankrupt or insolvent, or seeking dissolution, winding up, liquidation,
reorganization, arrangement, adjustment or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors or fail to file
an answer or other pleading denying the material allegations of any such proceeding filed
against it, (v) take any corporate or partnership action to authorize or effect any of
the foregoing actions set forth in this Section 7.6, or (vi) fail to contest in
good faith any appointment or proceeding described in Section 7.7.  

        7.7     
Involuntary Bankruptcy; Appointment of Receiver; Etc. Without the application, approval or consent of the Company or any of its Subsidiaries, a receiver, trustee,
examiner, liquidator or similar official shall be appointed for the Company or any of its
Subsidiaries or any Substantial Portion of its Property, or a proceeding described in Section
7.6(iv) shall be instituted against the Company or any of its Subsidiaries and such
appointment continues undischarged or such proceeding continues undismissed or unstayed
for a period of sixty (60) consecutive days.  

        7.8     
Custody or Control of Property. Any court, government or governmental agency shall
condemn, seize or otherwise appropriate, or take custody or control of, all or any
portion of the Property of the Company and its Subsidiaries which, when taken together
with all other Property of the Company and its Subsidiaries so condemned, seized,
appropriated, or taken custody or control of, during the twelve-month period ending with
the month in which any such action occurs, constitutes a Substantial Portion.  

51 

        7.9     
Judgments. The Company or any of its Subsidiaries shall fail within thirty (30)
days to pay, bond or otherwise discharge one or more (i) judgments or orders for the
payment of money (except to the extent covered by independent third-party insurance as to
which the insurer has not disclaimed coverage) in excess of $5,000,000 (or the
Approximate Equivalent Amount thereof in currencies other than Dollars) in the aggregate,
or (ii) nonmonetary judgments or orders which, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect, which judgment(s), in any such
case, is/are not stayed on appeal or otherwise being appropriately contested in good
faith.  

        7.10    
ERISA Liabilities. Any of (i) a Termination Event occurs with respect to any Plan
and, within thirty (30) days after the reporting of such Termination Event to the Lender,
the Lender shall have notified the Company in writing that (a) the Lender has determined
that such Termination Event might be reasonably expected materially to impair the right
of the Company and its ERISA Affiliates, taken as a whole, to carry on business
substantially as now being or heretofore conducted, or (b) materially adversely affects
the financial condition of the Company and its ERISA Affiliates taken as a whole, and as
a result thereof, an Default exists hereunder; or (ii) the plan administrator of any Plan
applies under Section 412(d) of the IRC for a waiver of the minimum funding standards of
Section 412(a) of the IRC and the Lender believes that the substantial business hardship
upon which the application for the waiver is based might be reasonably expected
materially to impair the right of the Company and its ERISA Affiliates, taken as a whole,
to carry on business substantially as now being or heretofore conducted, or materially
adversely affects the financial condition of the Company and its ERISA Affiliates taken
as a whole; or (iii) the present value of the aggregate unfunded liabilities to provide
the accrued benefits under all Foreign Pension Plans exceeds in the aggregate an amount
equal to five percent (5%) of the fair market value of the assets held in trust or other
funding vehicles for accrued benefits under all Foreign Pension Plans.  

        7.11    
Environmental Matters. The Company or any of its Subsidiaries shall (i) be the
subject of any proceeding or investigation pertaining to the release by the Company, any
of its Subsidiaries or any other Person of any toxic or hazardous waste or substance into
the environment, or (ii) violate any Environmental Law, which, in the case of an event
described in clause (i) or clause (ii), could reasonably be expected to
have a Material Adverse Effect.  

        7.12    
    Change in Control.  Any Change in Control shall occur. 

        7.13    
Guarantor Revocation. Any guarantor of the Obligations shall terminate or revoke
any of its obligations under the applicable Guaranty or breach any of the material terms
of such Guaranty.  

52 

ARTICLE 8  

ACCELERATION, WAIVERS,
AMENDMENTS AND REMEDIES  

        8.1     
     Acceleration.  Facility LC Collateral Account. 

	 	        8.1.1    
If any Default described in Section 7.6 or 7.7 occurs with respect to any
Borrower, the obligations of the Lender to make Loans hereunder and the obligation and
power of the LC Issuer to issue Facility LCs shall automatically terminate and the
Obligations shall immediately become due and payable without any election or action on
the part of the LC Issuer or the Lender, and the Borrowers will be and become thereby
unconditionally obligated, without any further notice, act or demand, to pay to the
Lender an amount in immediately available funds, which funds shall be held in the
Facility LC Collateral Account, equal to the difference of (x) the amount of LC
Obligations at such time, less (y) the amount on deposit in the Facility LC Collateral
Account at such time which is free and clear of all rights and claims of third parties
and has not been applied against the Obligations (such difference, the “Collateral
Shortfall Amount”). If any other Default occurs, the Lender may (a) terminate or
suspend the obligations of the Lender to make Loans hereunder and the obligation and
power of the LC Issuer to issue Facility LCs, or declare the Obligations to be due and
payable, or both, whereupon the Obligations shall become immediately due and payable,
without presentment, demand, protest or notice of any kind, all of which the Borrowers
hereby expressly waive, and (b) upon notice to the Borrowers and in addition to the
continuing right to demand payment of all amounts payable under this Agreement, make
demand on the Borrowers to pay, and the Borrowers will, forthwith upon such demand and
without any further notice or act, pay to the Lender the Collateral Shortfall Amount,
which funds shall be deposited in the Facility LC Collateral Account.  

	 	        8.1.2    
If at any time while any Default is continuing, the Lender determines that the Collateral
Shortfall Amount at such time is greater than zero, the Lender may make demand on the
Borrowers to pay, and the Borrowers will, forthwith upon such demand and without any
further notice or act, pay to the Lender the Collateral Shortfall Amount, which funds
shall be deposited in the Facility LC Collateral Account.  

	 	        8.1.3    
The Lender may at any time or from time to time after funds are deposited in the Facility
LC Collateral Account, apply such funds to the payment of the Obligations and any other
amounts as shall from time to time have become due and payable by any Borrower to the
Lender or the LC Issuer under the Loan Documents.  

	 	        8.1.4    
At any time while any Default is continuing, neither the Borrowers nor any Person
claiming on behalf of or through the Borrowers shall have any right to withdraw any of
the funds held in the Facility LC Collateral Account. After all of the Obligations have
been indefeasibly paid in full and the Commitment has been terminated, any funds
remaining in the Facility LC Collateral Account shall be returned by the Lender to the
Borrowers or paid to whomever may be legally entitled thereto at such time.  

	 	        8.1.5    
If, within thirty (30) days after acceleration of the maturity of the Obligations or
termination of the obligations of the Lender to make Loans and the obligation and power
of the LC Issuer to issue Facility LCs hereunder as a result of any Default (other than
any Default as described in Section 7.6 or 7.7), with respect to any
Borrower and before any judgment or decree for the payment of the Obligations due shall
have been obtained or entered, the Lender may (in its sole discretion), by notice to the
Borrowers, rescind and annul such acceleration and/or termination.  

53 

        8.2     
Amendments. Subject to the provisions of this Article VIII, the Lender and the
Borrowers may enter into agreements supplemental hereto for the purpose of adding or
modifying any provisions to the Loan Documents or changing in any manner the rights of
the Lender or the Borrowers hereunder or thereunder or waiving any Default hereunder or
thereunder.  

        8.3     
Preservation of Rights. No delay or omission of the Lender or the LC Issuer to
exercise any right under the Loan Documents shall impair such right or be construed to be
a waiver of any Default or an acquiescence therein, and the making of a Credit Extension
notwithstanding the existence of a Default or Unmatured Default or the inability of the
Borrowers to satisfy the conditions precedent to such Credit Extension shall not
constitute any waiver or acquiescence. Any single or partial exercise of any such right
shall not preclude other or further exercise thereof or the exercise of any other right,
and no waiver, amendment or other variation of the terms, conditions or provisions of the
Loan Documents whatsoever shall be valid unless in writing signed by, or by the Lender,
and then only to the extent in such writing specifically set forth. All remedies
contained in the Loan Documents or by law afforded shall be cumulative and all shall be
available to the LC Issuer and the Lender until all of the Obligations have been paid in
full.  

ARTICLE 9  

GUARANTY  

        9.1     
Guarantee of Obligations.  

	 	        9.1.1    
Company Guaranty. The Company hereby (i) guarantees, as principal obligor and not
as surety only, to the Lender and the LC Issuer the prompt payment of the principal of
and any and all accrued and unpaid interest (including interest which otherwise may cease
to accrue by operation of any insolvency law, rule, regulation or interpretation thereof)
on the Credit Extensions and all other Obligations of the Subsidiary Borrowers to the
Lender under this Agreement when due, whether by scheduled maturity, acceleration or
otherwise, all in accordance with the terms of this Agreement and the Notes, including,
without limitation, fees, reimbursement obligations, default interest, indemnification
payments and all reasonable costs and expenses incurred by the Lender or the LC Issuer in
connection with enforcing any obligations of the Subsidiary Borrowers hereunder,
including without limitation the reasonable fees and disbursements of counsel, (ii)
guarantees the prompt and punctual performance and observance of each and every term,
covenant or agreement contained in this Agreement and the Notes to be performed or
observed on the part of any Subsidiary Borrower and (iii) agrees to make prompt payment,
on demand, of any and all reasonable costs and expenses incurred by the Lender or the LC
Issuer in connection with enforcing the obligations of the Company hereunder, including,
without limitation, the reasonable fees and disbursements of counsel (all of the
foregoing being collectively referred to as the “Guaranteed Obligations”).  

	 	        9.1.2    
Performance by Company. If for any reason any duty, agreement or obligation of any
Subsidiary Borrower contained in this Agreement shall not be performed or observed by
such Subsidiary Borrower as provided therein, or if any amount payable under or in
connection with this Agreement shall not be paid in full when the same becomes due and
payable, the Company undertakes to perform or cause to be performed promptly each of such
duties, agreements and obligations and to pay forthwith each such amount to the Lender
regardless of any defense or setoff or counterclaim which such Subsidiary Borrower may
have or assert, and regardless of any other condition or contingency.  

54 

	 	        9.1.3    
Nature of Guaranty. The obligations of the Company hereunder constitute an
absolute and unconditional and irrevocable guaranty of payment and not a guaranty of
collection and are wholly independent of and in addition to other rights and remedies of
the Lender and are not contingent upon the pursuit by the Lender of any such rights and
remedies, such pursuit being hereby waived by the Company.  

	 	        9.1.4    
Waivers and Other Agreements. The Company hereby unconditionally (a) waives any
requirement that the Lender, upon the occurrence of a Default, first make demand upon or
seek to enforce remedies against any Subsidiary Borrower before demanding payment under
or seeking to enforce the obligations of the Company hereunder, (b) covenants that the
obligations of the Company hereunder will not be discharged except by complete
performance of all obligations of each Subsidiary Borrower contained in this Agreement
and the Notes, (c) agrees that the obligations of the Company hereunder shall remain in
full force and effect without regard to, and shall not be affected or impaired, without
limitation, by any invalidity, irregularity or unenforceability in whole or in part of
this Agreement or the Notes, or any limitation on the liability of any Subsidiary
Borrower thereunder, or any limitation on the method or terms of payment thereunder which
may or hereafter be caused or imposed in any manner whatsoever (including, without
limitation, usury laws), (d) waives diligence, presentment and protest with respect to,
and any notice of default or dishonor in the payment of any amount at any time payable by
any Subsidiary Borrower under or in connection with this Agreement or the Notes, and
further waives any requirement of notice of acceptance of, or other formality relating
to, the obligations of the Company hereunder and (e) agrees that the Guaranteed
Obligations shall include any amounts paid by any Subsidiary Borrower to the Lender which
may be required to be returned to such Subsidiary Borrower or to their representative or
to a trustee, custodian or receiver for such Subsidiary Borrower.  

	 	        9.1.5    
Obligations Absolute. The obligations, covenants, agreements and duties of the
Company under this Agreement shall not be released, affected or impaired by any of the
following whether or not undertaken with notice to or consent of the Company: (a) an
assignment or transfer, in whole or in part, of the Loans made to any Subsidiary Borrower
or of this Agreement or any Note although made without notice to or consent of the
Company, or (b) any waiver by the Lender or by any other Person, of the performance or
observance by any Subsidiary Borrower of any of the agreements, covenants, terms or
conditions contained in this Agreement or in the Notes, or (c) any indulgence in or the
extension of the time for payment by any Subsidiary Borrower of any amounts payable under
or in connection with this Agreement or any Note, or of the time for performance by any
Subsidiary Borrower of any other obligations under or arising out of this Agreement or
any Note, or the extension or renewal thereof, or (d) the modification, amendment or
waiver (whether material or otherwise) of any duty, agreement or obligation of any
Subsidiary Borrower set forth in this Agreement or any Note (the modification, amendment
or waiver from time to time of this Agreement and the Notes being expressly authorized
without further notice to or consent of the Company), or (e) the voluntary or involuntary
liquidation, sale or other disposition of all or substantially all of the assets of any
Subsidiary Borrower or any receivership, insolvency, bankruptcy, reorganization, or other
similar proceedings, affecting any Subsidiary Borrower or any of its assets, or (f) the
merger or consolidation of any Subsidiary Borrower or the Company with any other person,
or (g) the release of discharge of any Subsidiary Borrower or the Company from the
performance or observance of any agreement, covenant, term or condition contained in this
Agreement or any Note, by operation of law, or (h) any other cause whether similar or
dissimilar to the foregoing which would release, affect or impair the obligations,
covenants, agreements or duties of the Company hereunder.  

55 

        9.2     
No Investigation by Lenders or Administrative Agent. The Company hereby waives
unconditionally any obligation which, in absence of such provision, the Lender might
otherwise have to investigate or to assure that there has been compliance with the law of
any jurisdiction with respect to the Guaranteed Obligations recognizing that, to save
both time and expense, the Company has requested that the Lender not undertake such
investigation. The Company hereby expressly confirms that the obligations of the Company
hereunder shall remain in full force and effect without regard to compliance or
noncompliance with any such law and irrespective of any investigation or knowledge of the
Lender of any such law.  

        9.3     
Indemnity. As a separate, additional and continuing obligation, the Company
unconditionally and irrevocably undertakes and agrees with the Lender that, should the
Guaranteed Obligations not be recoverable from the Company under Section 9.1 for
any reason whatsoever (including, without limitation, by reason of any provision of this
Agreement or the Notes or any other agreement or instrument executed in connection
herewith being or becoming void, unenforceable, or otherwise invalid under any applicable
law) then, notwithstanding any knowledge thereof by the Lender at any time, the Company
as sole, original and independent obligor, upon demand by the Lender, will make payment
to the Lender of the Guaranteed Obligations by way of a full indemnity in such currency
and otherwise in such manner as is provided in this Agreement and the Notes.  

        9.4     
Reinstatement. If at any time any payment of any Guaranteed Obligations by any
Subsidiary Borrower is rescinded or must be otherwise restored or returned upon the
insolvency, bankruptcy or reorganization of any Subsidiary Borrower or otherwise, each of
the Company’s obligations hereunder with respect to such payment shall be reinstated
as though such payment had been due but not made at such time.  

ARTICLE 10  

GENERAL PROVISIONS  

        10.1    
Survival of Representations. All representations and warranties of the Borrowers
contained in this Agreement shall survive the making of the Credit Extensions herein
contemplated.  

        10.2    
Governmental Regulation. Anything contained in this Agreement to the contrary
notwithstanding, neither the LC Issuer nor the Lender shall be obligated to extend credit
to the Borrowers in violation of any limitation or prohibition provided by any applicable
statute or regulation.  

56 

        10.3    
Headings. Section headings in the Loan Documents are for convenience of reference
only, and shall not govern the interpretation of any of the provisions of the Loan
Documents.  

        10.4    
Entire Agreement. The Loan Documents embody the entire agreement and understanding
among the Borrowers, the LC Issuer and the Lender and supersede all prior agreements and
understandings among the Borrowers, the LC Issuer and the Lender relating to the subject
matter thereof.  

        10.5    
Benefits of this Agreement. This Agreement shall not be construed so as to confer
any right or benefit upon any Person other than the parties to this Agreement and their
respective successors and assigns.  

        10.6    
Expenses; Indemnification.  

	 	        10.6.1    
The Borrowers shall reimburse the Lender and the LC Issuer for any costs, internal
charges and out-of-pocket expenses (including reasonable attorneys’ and paralegals’ fees,
time charges and expenses of attorneys and paralegals for the Lender and the LC Issuer,
which attorneys and paralegals may or may not be employees of the Lender and the LC
Issuer, and expenses of and fees for other advisors and professionals engaged by the
Lender and the LC Issuer) paid or incurred by the Lender and the LC Issuer in connection
with the investigation, preparation, negotiation, documentation, execution, delivery,
syndication, distribution (including, without limitation, via the internet), review,
amendment, modification, administration, enforcement and collection of the Loan
Documents.  

	 	        10.6.2    
The Borrowers hereby further agree to indemnify the LC Issuer, the Lender, their
respective Affiliates, and each of their directors, officers and employees against all
losses, claims, damages, penalties, judgments, liabilities and expenses (including,
without limitation, all reasonable expenses of litigation or preparation therefore
whether or not the LC Issuer, the Lender or any Affiliate is a party thereto, and all
reasonable attorneys’ and paralegals’ fees, time charges and expenses of
attorneys and paralegals of the party seeking indemnification, which attorneys and
paralegals may or may not been employees of such party seeking indemnification) which any
of them may pay or incur arising out of or relating to this Agreement, the other Loan
Documents, the transactions contemplated hereby or the direct or indirect application or
proposed application of the proceeds of any Credit Extension hereunder, except to the
extent that they are determined in a final, non-appealable judgment by a court of
competent jurisdiction to have resulted from the gross negligence or willful misconduct
of the party seeking indemnification. The obligations of the Borrowers under this Section
10.6 shall survive the termination of this Agreement.  

        10.7    
[Reserved]  

        10.8    
Accounting. Except as provided to the contrary herein, all accounting terms used
herein shall be interpreted and all accounting determinations hereunder shall be made in
accordance with Agreement Accounting Principles. If any changes in generally accepted
accounting principles are hereafter required or permitted and are adopted by the Company
or any of its Subsidiaries with the agreement of its independent certified public
accountants and such changes result in a change in the method of calculation of any of
the financial covenants, tests, restrictions or standards herein or in the related
definitions or terms used therein (“Accounting Changes”), the parties hereto
agree, at the Company’s request, to enter into negotiations, in good faith, in order
to amend such provisions in a credit neutral manner so as to reflect equitably such
changes with the desired result that the criteria for evaluating the Company’s and
its Subsidiaries’ financial condition shall be the same after such changes as if
such changes had not been made; provided, however, until such provisions are amended in a
manner reasonably satisfactory to the Lender, no Accounting Change shall be given effect
in such calculations and all financial statements and reports required to be delivered
hereunder shall be prepared in accordance with Agreement Accounting Principles without
taking into account such Accounting Changes. In the event such amendment is entered into,
all references in this Agreement to Agreement Accounting Principles shall mean generally
accepted accounting principles as of the date of such amendment.  

57 

        10.9    
Severability of Provisions. Any provision in any Loan Document that is held to be
inoperative, unenforceable, or invalid in any jurisdiction shall, as to that
jurisdiction, be inoperative, unenforceable, or invalid without affecting the remaining
provisions in that jurisdiction or the operation, enforceability, or validity of that
provision in any other jurisdiction, and to this end the provisions of all Loan Documents
are declared to be severable.  

        10.10   
Nonliability of Lenders. The relationship between the Borrowers on the one hand
and the Lender and the LC Issuer on the other hand shall be solely that of borrower and
lender. Neither the LC Issuer nor the Lender shall have any fiduciary responsibilities to
the Borrowers. Neither the LC Issuer nor the Lender undertakes any responsibility to the
Borrowers to review or inform the Borrowers of any matter in connection with any phase of
any Borrower’s business or operations. The Borrowers agree that neither the LC
Issuer nor the Lender shall have liability to the Borrowers (whether sounding in tort,
contract or otherwise) for losses suffered by the Borrowers in connection with, arising
out of, or in any way related to, the transactions contemplated and the relationship
established by the Loan Documents, or any act, omission or event occurring in connection
therewith, unless it is determined in a final, non-appealable judgment by a court of
competent jurisdiction that such losses resulted from the gross negligence or willful
misconduct of the party from which recovery is sought. Neither the LC Issuer nor the
Lender shall have any liability with respect to, and the Borrowers hereby waive, releases
and agrees not to sue for, any special, indirect, consequential or punitive damages
suffered by the Borrowers in connection with, arising out of, or in any way related to
the Loan Documents or the transactions contemplated thereby.  

        10.11   
Confidentiality. The Lender agrees to hold any confidential information which it
may receive from any Borrower pursuant to this Agreement in confidence, except for
disclosure (i) to its Affiliates, (ii) to legal counsel, accountants, and other
professional advisors to the Lender or to a Transferee or prospective Transferee (each of
whom, by its acceptance thereof, agrees to be bound by the terms of this Section 10.11),
(iii) to regulatory officials, (iv) to any Person as required by law, regulation, or
legal process, (v) to any Person, if required, in connection with any legal proceeding to
which the Lender is a party, (vi) to the Lender’s direct or indirect contractual
counterparties in swap agreements or to legal counsel, accountants and other professional
advisors to such counterparties (each of whom, by its acceptance thereof, agrees to be
bound by the terms of this Section 10.11), and (vii) permitted by Section 13.3.  

58 

        10.12   
Lender Not Utilizing Plan Assets. None of the consideration used by the Lender or
the LC Issuer to make its Credit Extensions constitutes for any purpose of ERISA or
Section 4975 of the Code assets of any “plan” as defined in Section 3(3) of
ERISA or Section 4975 of the Code and the rights and interests of the Lender and the LC
Issuer in and under the Loan Documents shall not constitute such “plan assets” under
ERISA.  

        10.13   
Nonreliance. The Lender hereby represents that it is not relying on or looking to
any margin stock (as defined in Regulation U) as collateral in the extension or
maintenance of the credit provided for herein.  

        10.14   
Disclosure. The Borrowers and the Lender hereby acknowledge and agree that the
Lender and/or its respective Affiliates from time to time may hold investments in, make
other loans to or have other relationships with the Borrowers and their Affiliates.  

        10.15   
Subordination of Intercompany Indebtedness. The Borrowers agree that any and all
claims of any Borrower against any Guarantor with respect to any “Intercompany
Indebtedness” (as hereinafter defined), any endorser, obligor or any other guarantor
of all or any part of the Obligations, or against any of its properties shall be
subordinate and subject in right of payment to the prior payment, in full and in cash, of
all Obligations. Notwithstanding any right of any Borrower to ask, demand, sue for, take
or receive any payment from any Guarantor, all rights, liens and security interests of
the Borrowers, whether now or hereafter arising and howsoever existing, in any assets of
any Guarantor (whether constituting part of any collateral given to the Lender to secure
payment of all or any part of the Obligations or otherwise) shall be and are subordinated
to the rights of the LC Issuer and the Lender in those assets. No Borrower shall have any
right to possession of any such asset or to foreclose upon any such asset, whether by
judicial action or otherwise, unless and until all of the Obligations (other than
contingent indemnity obligations) shall have been fully paid and satisfied (in cash) and
all financing arrangements pursuant to all of the Loan Documents have been terminated. If
all or any part of the assets of any Guarantor, or the proceeds thereof, are subject to
any distribution, division or application to the creditors of any Guarantor, whether
partial or complete, voluntary or involuntary, and whether by reason of liquidation,
bankruptcy, arrangement, receivership, assignment for the benefit of creditors or any
other action or proceeding, or if the business of any Guarantor is dissolved or if
substantially all of the assets of any Guarantor are sold, then, and in any such event
(such events being herein referred to as an “Insolvency Event”), any payment or
distribution of any kind or character, either in cash, securities or other property,
which shall be payable or deliverable upon or with respect to any indebtedness of any
Guarantor to any Borrower (“Intercompany Indebtedness”) shall be paid or
delivered directly to the Lender for application on any of the Obligations, due or to
become due, until such Obligations (other than contingent indemnity obligations) shall
have first been fully paid and satisfied (in cash). Should any payment, distribution,
security or instrument or proceeds thereof be received by any Borrower upon or with
respect to the Intercompany Indebtedness after any Insolvency Event and prior to the
satisfaction of all of the Obligations (other than contingent indemnity obligations) and
the termination of all financing arrangements pursuant to all of the Loan Documents, such
Borrower shall receive and hold the same in trust, as trustee, for the benefit of the LC
Issuer and the Lender and shall forthwith deliver the same to the Lender, for the benefit
of the LC Issuer and the Lender, in precisely the form received (except for the
endorsement or assignment of such Borrower where necessary), for application to any of
the Obligations, due or not due, and, until so delivered, the same shall be held in trust
by such Borrower as the property of the LC Issuer and the Lender. If any Borrower fails
to make any such endorsement or assignment to the Lender, the Lender or any of its
officers or employees is irrevocably authorized to make the same. Each Borrower agrees
that until the Obligations (other than the contingent indemnity obligations) have been
paid in full (in cash) and satisfied and all financing arrangements pursuant to any Loan
Document among the Borrowers, the LC Issuer and the Lender have been terminated, no
Borrower will assign or transfer to any Person (other than the Lender) any claim any
Borrower has or may have against any Guarantor.  

59 

ARTICLE 11  

[RESERVED] 

ARTICLE 12  

SETOFF  

        12.1    
Setoff. In addition to, and without limitation of, any rights of the Lender under
applicable law, if any Default occurs, any and all deposits (including all account
balances, whether provisional or final and whether or not collected or available) and any
other Indebtedness at any time held or owing by the Lender or any Affiliate of the Lender
to or for the credit or account of any Borrower may be offset and applied toward the
payment of the Obligations owing to the Lender, whether or not the Obligations, or any
part thereof, shall then be due.  

ARTICLE 13  

BENEFIT OF AGREEMENT;
PARTICIPATIONS  

        13.1    
Successors and Assigns. The terms and provisions of the Loan Documents shall be
binding upon and inure to the benefit of the Borrowers, the Lender and their respective
successors and assigns, except that (i) no Borrower shall have the right to assign its
rights or obligations under the Loan Documents without the consent of the Lender, and any
such assignment in violation of this Section 13.1 shall be null and void, and (ii)
the Lender may not assign its rights or obligations under the Loan Documents without the
consent of the Company, but may grant participations in compliance with Section 13.2.
The parties to this Agreement acknowledge that Section 13.1 relates only to
absolute assignments and does not prohibit assignments creating security interests,
including, without limitation, any pledge or assignment by the Lender of all or any
portion of its rights under this Agreement and any Note to a Federal Reserve Bank.  

        13.2    
Participations.  

	 	        13.2.1    
Permitted Participants; Effect. The Lender may, in the ordinary course of its
business and in accordance with applicable law, at any time sell to one or more banks or
other entities (“Participants”) participating interests in any Outstanding
Credit Exposure of the Lender, any Note held by the Lender, any Commitment of the Lender
or any other interest of the Lender under the Loan Documents. In the event of any such
sale by the Lender of participating interests to a Participant, the Lender’s
obligations under the Loan Documents shall remain unchanged, the Lender shall remain
solely responsible to the other parties hereto for the performance of such obligations,
the Lender shall remain the owner of its Outstanding Credit Exposure and the holder of
any Note issued to it in evidence thereof for all purposes under the Loan Documents, all
amounts payable by the Borrowers under this Agreement shall be determined as if the
Lender had not sold such participating interests, and the Borrowers shall continue to
deal solely and directly with the Lender in connection with the Lender’s rights and
obligations under the Loan Documents.  

60 

	 	        13.2.2    
Voting Rights. The Lender shall retain the sole right to approve, without the
consent of any Participant, any amendment, modification or waiver of any provision of the
Loan Documents other than any amendment, modification or waiver with respect to any
Credit Extension or Commitment in which such Participant has an interest which (i)
extends the final maturity of any Loan or any Facility LC beyond the Facility Termination
Date or forgives all or a portion of the principal amount thereof or interest or fees
thereon, or reduces the rate or extends the time of payment of interest or fees on any
such Loan or the related Commitment or (ii) extends the Facility Termination Date, or
releases any guarantor of the Obligations or all or substantially all of the collateral,
if any, securing the Obligations.  

	 	        13.2.3    
Benefit of Setoff. The Borrowers agree that each Participant shall be deemed to
have the right of setoff provided in Section 12.1 in respect of its participating
interest in amounts owing under the Loan Documents to the same extent as if the amount of
its participating interest were owing directly to it as a Lender under the Loan
Documents, provided that the Lender shall retain the right of setoff provided in Section
12.1 with respect to the amount of participating interests sold to each Participant.
The Lender agrees to share with each Participant, and each Participant, by exercising the
right of setoff provided in Section 12.1, agrees to share with the Lender, any
amount received pursuant to the exercise of its right of setoff, such amounts to be
shared on a pro rata basis as if each Participant were a Lender.  

        13.3    
Dissemination of Information. The Borrowers authorize the Lender to disclose to
any Participant or any other Person acquiring an interest in the Loan Documents by
operation of law (each a “Transferee”) and any prospective Transferee any and
all information in the Lender’s possession concerning the creditworthiness of the
Company and its Subsidiaries, including without limitation any information contained in
any reports or other information delivered by any Borrower pursuant to Section 6.1;
provided that each Transferee and prospective Transferee agrees to be bound by Section
10.11 of this Agreement.  

ARTICLE 14  

NOTICES  

        14.1    
Notices. Except as otherwise permitted by Section 2.14 with respect to
borrowing notices, all notices, requests and other communications to any party hereunder
shall be in writing (including electronic transmission, facsimile transmission or similar
writing) and shall be given to such party: (x) in the case of the Borrowers or the
Lender, at its respective address or facsimile number set forth on the signature pages
hereof or (y) in the case of any party, at such other address or facsimile number as such
party may hereafter specify for the purpose by notice to the Company in accordance with
the provisions of this Section 14.1. Each such notice, request or other
communication shall be effective (i) if given by facsimile transmission, when transmitted
to the facsimile number specified in this Section and confirmation of receipt is
received, (ii) if given by mail, 72 hours after such communication is deposited in the
mails with first class postage prepaid, addressed as aforesaid, or (iii) if given by any
other means, when delivered (or, in the case of electronic transmission, received) at the
address contemplated by this Section; provided that notices to the Lender under Article
II shall not be effective until received. For all purposes under this Agreement and the
other Loan Documents, (A) notice to the Lender from any Borrower shall not be deemed to
be effective until actually received by the Lender, and (B) delivery of any notice to the
Company shall be deemed to have been delivered to the Borrowers.  

61 

        14.2    
Change of Address. The Borrower and the Lender may each change the address for
service of notice upon it by a notice in writing to the other parties hereto.  

ARTICLE 15  

COUNTERPARTS  

        This
Agreement may be executed in any number of counterparts, all of which taken together
shall constitute one agreement, and any of the parties hereto may execute this Agreement
by signing any such counterpart. This Agreement shall be effective when it has been
executed by the Company, the LC Issuer and the Lender.  

ARTICLE 16  

CHOICE OF LAW; CONSENT
TO JURISDICTION; WAIVER OF JURY TRIAL  

        16.1    
CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A CONTRARY EXPRESS
CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS
(INCLUDING, WITHOUT LIMITATION, 735 ILCS 105/5-1 ET SEQ., BUT OTHERWISE WITHOUT REGARD TO
THE CONFLICT OF LAWS PROVISIONS) OF THE STATE OF ILLINOIS, BUT GIVING EFFECT TO FEDERAL
LAWS APPLICABLE TO NATIONAL BANKS.  

        16.2    
CONSENT TO JURISDICTION. EACH BORROWER HEREBY IRREVOCABLY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE COURT SITTING
IN CHICAGO, ILLINOIS IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN
DOCUMENTS AND EACH BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH
ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES
ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING
HEREIN SHALL LIMIT THE RIGHT OF THE LC ISSUER OR THE LENDER TO BRING PROCEEDINGS AGAINST
ANY BORROWER IN THE COURTS OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY ANY
BORROWER AGAINST THE LC ISSUER OR THE LENDER OR ANY AFFILIATE OF THE LC ISSUER OR THE
LENDER INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED
TO, OR CONNECTED WITH ANY LOAN DOCUMENT SHALL BE BROUGHT ONLY IN A COURT IN CHICAGO,
ILLINOIS OR THE CITY IN WHICH THE PRINCIPAL OFFICE OF THE LENDER OR AFFILIATE, AS THE
CASE MAY BE, IS LOCATED.  

62 

        16.3    
WAIVER OF JURY TRIAL. THE BORROWERS, THE LC ISSUER AND THE LENDER HEREBY WAIVE
TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER
(WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO,
OR CONNECTED WITH ANY LOAN DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER.  

ARTICLE 17 

TERMINATION OF
EXISTING CREDIT AGREEMENT  

        The
Company and the Lender agree that upon (i) the execution and delivery of this Agreement
by each of the parties hereto and (ii) satisfaction (or waiver by the aforementioned
parties) of the conditions precedent set forth in Section 4.1, the “Commitments” (as
defined in the Existing Credit Agreement) shall be reduced to zero and terminated
permanently as of the date immediately preceding the Closing Date of this Agreement. All
facility fees and related fees payable pursuant to the Existing Credit Agreement shall be
due and payable on the effective date of the termination of such agreement, which date
shall be concurrent with the Closing Date of this Agreement.  

[Signature Pages Follow] 

63 

        IN
WITNESS WHEREOF, the Company, the Lender and the LC Issuer have executed this Agreement
as of the date first above written.  

		JOHNSON OUTDOORS INC., as a Borrower

		By:   	  /s/ David Harrington 

			David Harrington, Assistant Treasurer

		

555 Main Street, Suite 28

Racine, WI  53403

Attention:  David Harrington

Phone:  262/631-6634

Fax:  262/631-6608

E-mail:  dharring@johnsonoutdoors.com

		LASALLE BANK NATIONAL ASSOCIATION, 
as the Lender and the LC Issuer

		By:   	  /a/ Lou D. Banach 

			Lou D. Banach, Senior Vice President

                                                              Senior Lender

		

411 East Wisconsin Avenue

Milwaukee, Wisconsin 53202

Attention:  Lou D. Banach

Phone:  414-224-0394

Fax:  414-224-0071

E-mail:  lou.d.banach@abnamro.com

64 

Exhibit A  

Form of Borrower’s
Counsel’s Opinion
[LETTERHEAD OF FOLEY & LARDNER]  

[October 29, 2004]  

LaSalle Bank National Association
411
East Wisconsin Avenue
Milwaukee, WI 53202  

Re: Johnson Outdoors Inc.  

Ladies and Gentlemen:  

        This
opinion is furnished to you pursuant to Section 4.1.5 of the Revolving Credit Agreement
dated as of October 29, 2004 (the “Credit Agreement”) among Johnson Outdoors
Inc., a Wisconsin corporation (the “Company”), one or more other Subsidiary
Borrowers that may from time to time become parties thereto, and LaSalle Bank National
Association. Terms not otherwise defined herein are used as defined in the Credit
Agreement, except that the term Guarantor shall mean only those subsidiaries of the
Company that are Domestic Subsidiaries on the date hereof. 

        1.     We
have acted as special counsel for the Company and the Guarantors in connection with the
preparation, execution and delivery of the Credit Agreement and the following related
documents: 

        2.     The
Guaranty, dated October ___, 2004 (the “Guaranty”), executed by each Guarantor
in favor of the Lender; 

        3.     Note,
dated October ___, 2004 (the “Note”), executed by the Borrower and made payable
to the Lender pursuant to Section 2.14 of the Credit Agreement; and 

        The
other documents furnished by, or pertaining to, the Company and each Guarantor pursuant to
Sections 4.1.1, 4.1.2 and 4.1.3 of the Credit Agreement. 

        In
addition, we have examined the originals, or copies certified to our satisfaction, of such
other corporate records of the Company and each Guarantor, certificates of public
officials and of officers of the Company and each Guarantor, and agreements, instruments
and documents, as we have deemed necessary as a basis for the opinions hereinafter
expressed. 

        In
rendering this opinion we have, with your permission, relied on the officer’s
certificate annexed hereto as Exhibit A (the “Officer’s
Certificate”) as to certain factual matters and assumed, without investigation,
verification or inquiry that: 

        (a)     Each
of the parties (other than the Company and the Guarantors) is a corporation or association
duly organized and validly existing under the laws of its jurisdiction of incorporation or
organization; 

A-1 

LaSalle Bank National Association

October 29, 2004 
Page 2 

        (b)     Each
of the parties (other than the Company and the Guarantors) has the necessary right, power
and authority to execute, deliver and perform its obligations under the Credit Agreement,
the Note and the Guaranty; the transactions therein contemplated have been duly authorized
by all parties thereto (other than the Company and the Guarantors); and the Credit
Agreement, the Note and the Guaranty constitute the legal, valid and binding obligations
of all parties thereto (other than the Company and the Guarantors); 

        (c)     The
Credit Agreement, the Note and the Guaranty have been duly executed, delivered, and
accepted by all parties thereto (other than the Company and the Guarantors); 

        (d)     There
is no oral or written agreement, understanding, course of dealing or usage of trade that
affects the rights and obligations of the parties set forth in the Credit Agreement, the
Note or the Guaranty, or that would have an effect on the opinions expressed herein; there
are no judgments, decrees or orders that impair or limit the ability of the Company or any
Guarantor, as the case may be, to enter into, execute, deliver and perform, observe and be
bound by the Credit Agreement, the Note and the Guaranty and the transactions contemplated
therein (however we have no knowledge of any such judgments, decrees or orders); all
material terms and conditions of the relevant transactions between the Company, the Lender
and the Guarantors are correctly and completely reflected in the Credit Agreement, the
Note and the Guaranty; and there has been no waiver of any of the provisions of the Credit
Agreement, the Note or the Guaranty by conduct of the parties or otherwise; 

        (e)     All
natural persons who are signatories to the Credit Agreement, the Note or the Guaranty were
legally competent at the time of execution; all signatures on behalf of parties other than
the Company and the Guarantors on the Credit Agreement, the Note, the Guaranty and the
other documents reviewed by us are genuine; the copies of all documents submitted to us
are accurate and complete, each such document that is original is authentic and each such
document that is a copy conforms to an authentic original; and the documents executed and
delivered by the parties are in substantially the same form as the forms of those
documents that we have reviewed in rendering this opinion; 

        (f)     The
Company has received adequate consideration with respect to the execution and delivery of
the Credit Agreement and the Note; and 

        (g)     Each
Guarantor has received adequate consideration with respect to the execution and delivery
of the Guaranty. 

        (h)     Based
upon the foregoing, but subject to the assumptions, qualifications and limitations set
forth herein, we are of the opinion that: 

	 	        (1)     The
Company is a corporation validly existing under the laws of the State of Wisconsin and,
based solely on a certificate of the Wisconsin Department of Financial Institutions, has
filed its most recent required annual report, and has not filed articles of dissolution,
with the Wisconsin Department of Financial Institutions. Each Guarantor is a corporation
or association validly existing under the laws of its jurisdiction of incorporation or
organization.  

A-2 

LaSalle Bank National Association

October 29, 2004 
Page 3 

	 	        (2)     (a)               The
Company has the corporate power to enter into, and perform its obligations
          under, the Credit Agreement and the Note. The execution, delivery and
          performance of the Credit Agreement have been duly authorized by all necessary
          corporate action on the part of the Company.  

	 	                 (b)             Each
Guarantor has the corporate power to enter into, and perform its           obligations
under, the Guaranty. The execution, delivery and performance of the           Guaranty
have been duly authorized by all necessary corporate action on the part           of each
Guarantor.  

	 	        (3)     The
Credit Agreement and the Note are the legal, valid and binding obligations of the
Company, enforceable against the Company in accordance with their terms. The Guaranty is
the legal, valid and binding obligation of the Guarantor executing the Guaranty,
enforceable against such Guarantor in accordance with its terms.  

	 	        (4)     The
execution and delivery of, and performance by the Company and each Guarantor of their
respective obligations under, the Credit Agreement, the Note and the Guaranty do not: (a)
constitute a breach or violation of the organizational documents of the Company or any
Guarantor; (b) as to payment obligations only, result in a violation of any applicable
law, statute, or regulation of the United States or the States of Wisconsin and Illinois
or the Delaware General Corporation Law which is known by us to be applicable to the
Company or the Guarantors; (c) result in a violation of any judgment, order, writ,
injunction, decree, determination or award of which we have knowledge; (d) constitute an
event of default under or result in a breach or violation of any indenture, agreement or
other instrument to which the Company is a party or by which any of its property or
assets is bound (i) of which we have knowledge which affects or purports to affect the
Company’s right to borrow money, or the right of any Guarantor to incur contingent
obligations or (ii) violation of which could, according to the Officer’s
Certificate, have a material adverse effect on the property, financial condition, or
business operations of the Company; or (e) to our knowledge, result in the creation of
any lien, charge or encumbrance on any property or assets of the Company or any
Guarantor.  

	 	        (5)     No
authorization, consent, approval or other action by, and no notice to or filing with, any
governmental authority or regulatory body is required to be obtained or made by the
Company or any Guarantor for the due execution and delivery of, or performance of their
respective payment obligations under, the Credit Agreement, the Note and the Guaranty,
except (a) such as have been duly obtained or made and are in full force and effect; (b)
such as may be required by orders, decrees and the like that are specifically applicable
to the Company or any Guarantor and of which we have no knowledge; and (c) such as may be
required by applicable federal or state securities laws or pursuant to any rule or
regulation of the U.S. Securities Exchange Commission or the New York Stock Exchange.  

	 	        (6)     To
our knowledge, (i) neither the Company nor any Guarantor is a party to any litigation or
administrative proceeding that relates to the execution and delivery of, or performance
of obligations under, the Credit Agreement, the Note or the Guaranty and (ii) there is
not now pending or threatened any litigation, contest, claim or governmental proceeding
by or against the Company or any Guarantor, other than the litigation, contests, claims
or governmental proceedings described on Schedule 1 hereto.  

A-3 

LaSalle Bank National Association

October 29, 2004 
Page 4 

        The
foregoing opinions are subject to the following additional assumptions and
qualifications:  

        A.               Wherever
we indicate that our opinion with respect to the existence or absence           of facts
is “to our knowledge” or the like, our opinion is, with your
          permission, based solely on the Officer’s Certificate and the current
          conscious awareness of facts or other information of the attorneys currently
          with our firm who have represented the Company and Guarantors in connection
with           the transactions contemplated by the Credit Agreement. Without limiting
the           generality of the foregoing, we have relied on the Officer’s
Certificate as           to the effect of the borrowing under the Credit Agreement and
the Note on the           financial covenants found in any indenture, agreement or other
instrument to           which the Company is a party or by which any of its property or
assets is bound,           and we have not reviewed any computations or calculations
related thereto.           Accordingly, we express no opinion as to the effect of such
borrowings on the           calculations or computations of such covenants.  

        B.     Our
opinion is limited by:  

	 	i. 	Applicable
bankruptcy, receivership, reorganization, insolvency, moratorium,
               fraudulent conveyance or transfer, and other laws and judicially developed
               doctrines relating to or affecting creditors’ (or secured creditors’)
               rights and remedies generally; 

	 	ii. 	General
principles of equity, regardless of whether such enforcement is                considered
in a proceeding in equity or at law, and limitations on the                availability
of specific performance, injunctive relief and other equitable                remedies;
and 

	 	iii. 	The
possibility that certain rights, remedies, waivers, and other provisions of
               the Credit Agreement and the Guaranty may not be enforceable;
nevertheless, such                unenforceability will not render the Credit Agreement
or the Guaranty invalid as                a whole or preclude (a) judicial enforcement of
the obligation of the Company to                repay the principal, together with
interest thereon (to the extent not deemed a                penalty) as provided in the
Credit Agreement and the Note or (b) acceleration of                the obligation of the
Company to repay such principal, together with such                interest, upon a
material default in a material provision of the Credit                Agreement and the
Note. 

        C.          We
have not examined the records of Lenders, the Company or any Guarantor or any
          court or any public, quasi-public, private or other office in any jurisdiction,
          or the files of our firm, and our opinions are subject to matters that an
          examination of such records would reveal.  

        D.          In
connection with our opinions expressed herein, we have assumed, with your
          permission, that (i) no Guarantor is insolvent; (ii) no Guarantor will be
          rendered insolvent by the transactions contemplated by the Guaranty; (iii)
after           giving effect to such transactions, no Guarantor will be left with
unreasonably           small capital with which to engage in its anticipated business;
and (iv) that no           Guarantor intends or believes that it will incur debts beyond
its ability to pay           as the debts mature.  

A-4 

LaSalle Bank National Association

October 29, 2004 
Page 5 

        The
opinions expressed herein are limited to the federal laws of the United States, the
Delaware General Corporation Law and the laws of the States of Wisconsin and Illinois in
effect on the date hereof as they presently apply, and we express no opinion herein as to
the laws of any other jurisdiction. These opinions are given as of the date hereof, they
are intended to apply only to those facts and circumstances that exist as of the date
hereof, and we assume no obligation or responsibility to update or supplement these
opinions to reflect any facts or circumstances that may hereafter come to our attention or
any changes in laws that may hereafter occur, or to inform the addressee(s) of any change
in circumstances occurring after the date hereof that would alter the opinions rendered
herein. 

        This
opinion is limited to the matters set forth herein, and no opinion may be inferred or
implied beyond the matters expressly contained herein. Except as expressly set forth
herein, this opinion is being provided solely for the purpose of complying with the
requirements of Section 4.1.5 of the Credit Agreement, and is being rendered solely for
the benefit of the addressee hereof. This opinion may not be used or relied upon for any
other purpose, relied upon by any other party, or filed with or disclosed to any
governmental authority other than a court in connection with the enforcement or protection
of the rights or remedies of the Lender under the Credit Agreement, the Note or the
Guaranty or to a banking examiner or regulator in connection with an examination of the
Lender by such governmental authority, without our prior written consent. 

		Very truly yours,

FOLEY & LARDNER

		By:   	   

			

A-5 

EXHIBIT A  

OFFICER’S
CERTIFICATE  

Attached Hereto  

A-6 

SCHEDULE 1  

LITIGATION  

A-7 

Exhibit B  

Form of Compliance
Certificate  

	To:  	LaSalle
Bank National Association
411 E. Wisconsin Avenue
Milwaukee, WI 53202

        This
Compliance Certificate is furnished pursuant to that certain Revolving Credit Agreement
dated as of October 29, 2004 (as amended, modified, renewed or extended from time to
time, (the “Agreement”) among Johnson Outdoors, Inc, a Wisconsin corporation
(the “Company”), the subsidiary borrowers from time to time parties thereto,
and LaSalle Bank National Association. Unless otherwise defined herein, capitalized terms
used in this Compliance Certificate have the meanings ascribed thereto in the Agreement.  

        THE
UNDERSIGNED HEREBY CERTIFIES THAT:  

        1.     I
am the duly elected _____________________ of the Company; 

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

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

        4.     Schedule
I attached hereto sets forth financial data and computations evidencing the Company’s
compliance with certain covenants of the Agreement, all of which data and computations
are true, complete and correct.  

        5.     Schedule
II attached hereto sets forth the determination of the Applicable Margin, the Applicable
Performance LC Fees and the Applicable Commitment Fee Rates commencing on the fifth day
following the delivery hereof.  

        6.     Schedule
III attached hereto sets forth the various reports and deliveries which are required at
this time under the Agreement and the other Loan Documents and the status of compliance.  

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

B-2 

        The
foregoing certifications, together with the computations set forth in Schedule I and
Schedule 11 hereto and the financial statements delivered with this Certificate in
support hereof, are made and delivered this ___ day of _________________, 2004.  

		

		By:   	   

			Name
Title:

B-2 

SCHEDULE 1 TO
COMPLIANCE CERTIFICATE  

Compliance as of
___________, ____ with
Provisions of Section
6.21 of
the Agreement  

	I. 	FINANCIAL
COVENANTS	

	 	 A. 	MAXIMUM
leverage RATIO (Section 6.21.1)	

	 	 (1) 	Total
Funded Debt 	=    $__________

	 	 (2) 	EBITDA 	

	 	 (a) 	Net
Income 	=    $__________

	 	 (b) 	Interest
Expense 	+    $__________

	 	 (c) 	Taxes
 	+    $__________

	 	 (d) 	Depreciation
expense 	+    $__________

	 	 (e) 	Amortization
expense 	+    $__________

	 	 (f) 	Other
non-recurring charges 	+    $__________

	 	 (g) 	Other
non-recurring credits 	–    $__________

	 	 (h) 	Other
non-recurring after-tax losses 
[Maximum of (e), (f)
and (g): $2,000,000 (other 
than adjustments for
Escape Sailboats and 
Necky Kayak operations up to
 $2,500,000] 	

	 	 B. 	MINIMUM
FIXED CHARGE COVERAGE RATIO 
(Section 6.21.2)	

	 	 (1) 	Numerator: 	

	 	 (a) 	EBITDA
(Section A(2)(i) above) 	    $__________

	 	 (b) 	Rentals
 	+    $__________

	 	 (c) 	Numerator
 	=    $__________

	 	 (2) 	Denominator: 	

	 	 (a) 	Cash
Interest Expenses on Indebtedness 	    $__________

B-3 

	 	 (b) 	Rentals	+    $__________

	 	 (c) 	Denominator	=    $__________

	 	 (3) 	Fixed
Charge Coverage Ratio 	 _____ to 1.00

	 	 (4) 	State
whether the Fixed Charge Coverage Ratio was 
less than the
permitted under Section 6.21.2 	Yes/No

	 	 C. 	MINIMUM
CONSOLIDATED NET WORTH (Section 6.21.3).	

	 	 (1) 	State
whether Consolidated Net Worth (as defined) was 
less than
[$100,000,000] at any time during the period 
from _________ to
____________ 	Yes/No

	II. 	OTHER
MISCELLANEOUS PROVISIONS	

	 	 A. 	DIVIDENDS
AND DISTRIBUTIONS (Section 6.11)	

	 	 (1) 	Aggregate
amount of cash dividends paid by the 
Company and its
Subsidiaries (other than as permitted 
under Sections 6.11.1
through 6.11.3 
[Maximum: $10,000,000 plus 50% of Consolidated

Net Income for the period from June 30, 2004 to the 
most
recent fiscal quarter] 	

	 	 B. 	INDEBTEDNESS
(Section 6.12)	

	 	 (1) 	Aggregate
principal amount of intercompany 
Indebtedness
 from the Company or any Guarantor 
to any Subsidiary that
 is not a Guarantor 
[Note: Includes
only such Indebtedness outstanding 
as of the Closing Date]	    $__________

	 	 (2) 	Aggregate
principal amount of Indebtedness in 
connection
 with overdraft facilities 
[Maximum:
$10,000,000] 	    $__________

	 	 (3) 	Aggregate
principal amount of Indebtedness 
evidenced by
 letters of credit (other than Facility LCs

 [Maximum: $10,000,000] 	    $__________

B-4 

	 	 (4) 	Aggregate
principal amount of other unsecured 
Indebtedness
 incurred by the Company and its Subsidiaries 
not otherwise
 permitted under Section 6.12

 [Maximum: $50,000,000] 
[Please
attached a detailed schedule setting forth all 
such
Indebtedness] 	    $__________

	 	 C. 	ASSET
SALES (Section 6.14)	

	 	 (1) 	State
whether any asset sales (other than (i) sales of 

 inventory or obsolete or excess assets, (ii) transfers 
of
 assets between the Company and the Guarantors, 
or from any
 Subsidiary to the Company or any 
Guarantor and (iii)
 certain other sales permitted under 
Section 6.14.3 have
 occurred. 	Yes/No

	 	 (2) 	If
yes, attach as a schedule hereto the details of such asset

sales and calculation of compliance with Section 6.14.4. 	

	 	 D. 	INVESTMENTS
(Section 6.15)	

	 	 (1) 	State
whether any Permitted Acquisitions occurred 
during
 the period. 
[Maximum: If Leverage
Ratio is greater than or equal 
to 3.0 to 1.0, $10,000,000 per
transaction and 
$15,000,000 per year; and if Leverage Ratio is
greater 
than or equal to 2.50 to 1.00 but less than 3.0 to
1.0, 
$15,000,000 per transaction and $30,000,000 per 
year; at
all other times no maximum purchase price 
limitations are in
effect] 	    $__________

	 	 (2) 	Aggregate
amount of Investments not otherwise 
permitted
 under Sections 6.15.5.1 through 6.15.5.9 
[Maximum: 25% of
 Consolidated Net Worth as of 
the end of the immediately
 preceding Fiscal Quarter] 	    $__________

	 	 E. 	GUARANTORS
(Sections 6.10)	

	 	 (1) 	Set
forth below is a list of all Domestic Subsidiaries 
of the
Company. Also set forth below is an indication 
of whether
such Subsidiaries are parties to the Guaranty. 	

B-5 

		
	
	

	Name of Domestic Subsidiaries and Jurisdiction of Formation
	Signatory to

Guaranty (Yes/No)

	
	

		Yes
	
	

		 
	
	

		Yes
	
	

B-6 

SCHEDULE II TO
COMPLIANCE CERTIFICATE  

Company’s
Applicable Margin, Applicable Performance L/C Fee, 
and Applicable Commitment Fee Rate
Calculation
[Attached]  

B-7 

SCHEDULE III TO
COMPLIANCE CERTIFICATE
Reports and Deliveries
Currently Due 

B-8 

Exhibit C  

Form of Loan/Credit
Related Money Transfer Instruction  

	         To:  	LaSalle
Bank National Association
411 East Wisconsin Avenue
Milwaukee, WI  53202

	Re:  	Revolving
Credit Agreement, dated as of October 29, 2004 (as the same may be amended, restated,
supplemented or otherwise modified, the “Credit Agreement”), among Johnson
Outdoors Inc., a Wisconsin corporation (the “Company”), the subsidiary
borrowers from time to time parties thereto, and LaSalle Bank National Association. 

        Capitalized
terms used herein and not otherwise defined herein shall have the meanings assigned
thereto in the Credit Agreement. 

        The
Lender is specifically authorized and directed to act upon the following standing money
transfer instructions with respect to the proceeds of Advances or other extensions of
credit from time to time until receipt by the Administrative Agent of a specific written
revocation of such instructions by the applicable Borrower, provided, however, that
the Lender may otherwise transfer funds as hereafter directed in writing by the applicable
Borrower in accordance with Section 13.1 of the Credit Agreement or based on any
telephonic notice made in accordance with Section 2.15 of the Credit Agreement. 

Facility Identification Number(s): 

Customer/Account Name: Johnson
Outdoors Inc. 

Transfer Funds To: 

For Account No.: 

Reference/Attention To: 

	Authorized Officer (Customer Representative):  	Date:

	(Please Print): ______________________________ 	Signature ______________________________

	Bank Officer Name _________________________ 	Date:

	(Please Print) ______________________________ 	Signature ______________________________

(Deliver Completed Form
to Credit Support Staff For Immediate Processing) 

C-1 

Exhibit D  

Form of Promissory
Note  

October 29, 2004 

        Johnson
Outdoors Inc. (the “Borrower”) promises to pay to the order of LaSalle Bank
National Association (the “Lender”) the aggregate unpaid principal amount of all
Loans made by the Lender to the Borrower pursuant to Article 2 of the Agreement (as
hereinafter defined), in immediately available funds at the office of the Lender in
Chicago, Illinois, together with interest on the unpaid principal amount hereof at the
rates and on the dates set forth in the Agreement. The Borrower shall pay the principal of
and accrued and unpaid interest on the Loans in full on the Facility Termination Date. 

        The
Lender shall, and is hereby authorized to, record on the schedule attached hereto, or to
otherwise record in accordance with its usual practice, the date and amount of each Loan
and the date and amount of each principal payment hereunder. 

        This
Note is the Note issued pursuant to, and is entitled to the benefits of, the Revolving
Credit Agreement dated as of October 29, 2004 (which, as it may be amended, restated,
supplemented or otherwise modified and in effect from time to time, is herein called the
(“Agreement”), among the Borrower, the Subsidiary Borrowers from time to time
parties thereto and the Lender to which Agreement reference is hereby made for a statement
of the terms and conditions governing this Note, including the terms and conditions under
which this Note may be prepaid or its maturity date accelerated. Capitalized terms used
herein and not otherwise defined herein are used with the meanings attributed to them in
the Agreement. 

        The
Borrower hereby waives presentment, demand, protest and any notice of any kind. No failure
to exercise and no delay in exercising, any rights hereunder on the part of the holder
hereof shall operate as a waiver of such rights. 

        This
Note shall be governed by and construed in accordance with the internal laws of the State
of Illinois, but giving effect to applicable federal laws. 

D-1 

		JOHNSON OUTDOORS INC.

		By:   	   

			Print Name:
Title:

D-2 

SCHEDULE OF LOANS AND
PAYMENTS OF PRINCIPAL TO NOTE 

DATED OCTOBER 29, 2004  

					
	Date	Principal 
Amount of 
Loan	Maturity 
of Interest 
Period	Principal 
Amount Paid	Unpaid 
Balance
	
	
	
	
	

D-3 

Exhibit E  

List of Closing
Documents  

CLOSING CHECKLIST
Revolving Credit
Agreement
by and among
Johnson Outdoors Inc.,
one or more other
Subsidiary Borrowers
from time to time
party thereto, and
LaSalle Bank National
Association
October 29, 2004  

		ITEM 
		PARTY
RESPONSIBLE

FOR
PREPARATION 

	
1	Revolving Credit Agreement	Q&B
	 	
a.	Exhibit A (Form of Opinion of Borrowers' and	 Q&B/F&L
			Guarantors' Counsel)
		b.	Exhibit B (Form of Compliance Certificate)	Q&B
		c.	Exhibit C (Form of Loan/Credit Related	Q&B
			Money Transfer Instruction)
		d.	Exhibit D (Form of Note)	Q&B
		e.	Exhibit E (List of Closing Documents)	Q&B
		f.	Exhibit F (Form of Guaranty)	Q&B
		g.	Exhibit G (Form of Assumption Letter)	Q&B
		h.	Pricing Schedule	LaSalle
		i.	Commitment Schedule	LaSalle
		j.	Eurocurrency Payment Office Schedule	LaSalle
		k.	Schedule 1.1 (Subsidiary Borrowers)	JOI
		l.	Schedule 2.21 (Existing Letters of Credit)	JOI
		m.	Schedule 5.4 (Financial Statements)	JOI
		n.	Schedule 5.7 (Litigation)	JOI
		o.	Schedule 5.8 (Subsidiaries)	JOI
		p.	Schedule 5.14 (ERISA Matters)	JOI
		q.	Schedule 5.16 (Environmental Matters)	JOI
		r.	Schedule 6.12 (Existing Indebtedness)	JOI
		s.	Schedule 6.15 (Existing Investments)	JOI
		t.	Schedule 6.16 (Existing Liens)	Q&B/JOI
	
2	Secretary's Certificates (Bylaws, Resolutions and Incumbency) 	JOI
		
a.	Johnson Outdoors Inc.
		b.	Leisure Life Limited
		c.	Old Town Canoe Company
		d.	Techsonic Industries, Inc.
		e.	Under Sea Industries, Inc.

E-1 

		ITEM 
		PARTY
RESPONSIBLE

FOR
PREPARATION 

	
3	Articles or Certificates of Incorporation	JOI
		
a.	Johnson Outdoors Inc.	
		b.	Leisure Life Limited
		c.	Old Town Canoe Company
		d.	Techsonic Industries, Inc.
		e.	Under Sea Industries, Inc.
	
4	Good Standing or Active Status Certificates	JOI
		
a.	Johnson Outdoors Inc.
		b.	Leisure Life Limited
		c.	Old Town Canoe Company
		d.	Techsonic Industries, Inc.
		e.	Under Sea Industries, Inc.
	
5	Compliance Certificate	Q&B
	
6	Opinion of Borrower's and Guarantors' Counsel	Q&B/F&L
	
7	Note	Q&B
	
8	Guaranty	Q&B
	
9	Provide satisfactory evidence that the Existing Credit	JOI
		Agreement has been terminated and that all
		amounts payable thereunder have been paid in full

E-2 

Exhibit F  

Form of Guaranty  

        THIS
GUARANTY (this “Guaranty”) is made as of the 29th day of October,
2004, by and among Leisure Life Limited, a Michigan corporation, Old Town Canoe Company, a
Delaware corporation, Techsonic Industries, Inc., an Alabama corporation, and Under Sea
Industries, Inc., a Delaware corporation (the “Initial Guarantors” and along
with any additional Subsidiaries of the Borrower which become parties to this Guaranty by
executing a supplement hereto in the form attached as Annex I, the
“Guarantors”), in favor of the Lender, under the Credit Agreement referred to
below. 

WITNESSETH: 

        WHEREAS,
JOHNSON OUTDOORS INC., a Wisconsin corporation (the “Company”), the Subsidiary
Borrowers from time to time parties thereto (together with the Company, the
“Borrowers”), and the Lender have entered into a certain Revolving Credit
Agreement dated as of October 29, 2004 (as the same may be amended, modified,
supplemented and/or restated, and as in effect from time to time, the “Credit
Agreement”), providing, subject to the terms and conditions thereof, for extensions
of credit and other financial accommodations to be made by the Lender to the Borrower; 

        WHEREAS,
it is a condition precedent to the initial extensions of credit by the Lender under the
Credit Agreement that each of the Guarantors (constituting all of the Domestic
Subsidiaries required to execute this Guaranty pursuant to Section 6.10 of the Credit
Agreement) execute and deliver this Guaranty, whereby each of the Guarantors shall
guarantee the payment when due of all Obligations (as defined in the Credit Agreement),
including, without limitation, all principal, interest, letter of credit reimbursement
obligations and other amounts that shall be at any time payable by the Borrowers under the
Credit Agreement, the other Loan Documents, and any Financial Contract to which the Lender
or any affiliate of the Lender shall be a party (each a “Designated Financial
Contract”); and 

        WHEREAS,
in consideration of the direct and indirect financial and other support that one or more
of the Borrowers has provided, and such direct and indirect financial and other support as
the Borrowers may in the future provide, to the Guarantors, and in order to induce the
Lender to enter into the Credit Agreement, each of the Guarantors is willing to guarantee
the obligations of the Borrowers under the Credit Agreement, any Designated Financial
Contract and the other Loan Documents; 

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

        SECTION
1.     Definitions. Terms defined in the Credit Agreement and not otherwise defined herein
have, as used herein, the respective meanings provided for therein. For purposes of this
Guaranty, “Holders of Obligations” means the holders of the Obligations from
time to time and shall include (i) the Lender and LC Issuer in respect of its Credit
Extensions, (ii) the Lender in respect of all other present and future obligations and
liabilities of the Borrowers of every type and description arising under or in connection
with the Credit Agreement or any other Loan Document, (iii) each indemnified party under
Section 10.6 of the Credit Agreement in respect of the obligations and liabilities of the
Borrowers to such Person hereunder and under the other Loan Documents, and (iv) their
respective successors, transferees and assigns. 

F-1  

        SECTION
2.     Representations, Warranties and Covenants. Each of the Guarantors represents and
warrants (which representations and warranties shall be deemed to have been renewed at the
time of the making, conversion or continuation of any Loan or issuance of any Facility LC)
that: 

	 	        (A)        It
is a corporation, partnership or limited liability company duly and properly
               incorporated or organized, as the case may be, validly existing and (to
the                extent such concept applies to such entity) in good standing under the
laws of                its jurisdiction of incorporation or organization and has all
requisite                authority to conduct its business in each jurisdiction in which
its business is                conducted, except to the extent that the failure to have
such authority could                not reasonably be expected to have a Material Adverse
Effect.  

	 	        (B)        It
(to the extent applicable) has the power and authority and legal right to
               execute and deliver this Guaranty and to perform its obligations
hereunder. The                execution and delivery by each Guarantor of this Guaranty
and the performance by                each of its obligations hereunder have been duly
authorized by proper                proceedings, and this Guaranty constitutes a legal,
valid and binding obligation                of each Guarantor, respectively, enforceable
against such Guarantor,                respectively, in accordance with its terms, except
as enforceability may be                limited by bankruptcy, insolvency or similar laws
affecting the enforcement of                creditors’ rights generally.  

	 	        (C)        Neither
the execution and delivery by it of this Guaranty, nor the consummation                of
the transactions herein contemplated, nor compliance with the provisions
               hereof will (i) violate any law, rule, regulation, order, writ, judgment,
               injunction, decree or award binding on it or its articles or certificate
of                incorporation, limited liability company or partnership agreement,
certificate                of partnership, articles or certificate of organization,
by-laws, or operating                agreement or other management agreement, as the case
may be, or the provisions                of any indenture, instrument or agreement to
which it is a party or is subject,                or by which it, or its Property, is
bound, or (ii) conflict with, or constitute                a default under, or result in,
or require, the creation or imposition of any                Lien in, of or on its
Property pursuant to the terms of, any such indenture,                instrument or
agreement. No order, consent, adjudication, approval, license,
               authorization, or validation of, or filing, recording or registration
with, or                exemption by, or other action in respect of any governmental or
public body or                authority, or any subdivision thereof, which has not been
obtained by it, is                required to be obtained by it in connection with the
execution, delivery and                performance by it of, or the legality, validity,
binding effect or                enforceability against it of, this Guaranty.  

F-2  

	 	        In
addition to the foregoing, each of the Guarantors covenants that, so long as the Lender
has any Commitment outstanding under the Credit Agreement or any amount payable under the
Credit Agreement or any other Guaranteed Obligations (as defined below) shall remain
unpaid, it will, and, if necessary, will enable the Borrowers to, fully comply with those
covenants and agreements of the Borrowers applicable to such Guarantor set forth in the
Credit Agreement.  

        SECTION
3.     The Guaranty. Each of the Guarantors hereby unconditionally guarantees, jointly with
the other Guarantors and severally, the full and punctual payment when due (whether at
stated maturity, upon acceleration or otherwise) of the Obligations, including, without
limitation, (i) the principal of and interest on each Advance made to any of the Borrowers
pursuant to the Credit Agreement, (ii) any Reimbursement Obligations of the Borrowers,
(iii) all obligations of the Borrowers owing to any Lender or any affiliate of any Lender
under any Designated Financial Contract, and (iv) all other amounts payable by any of the
Borrowers or any of their Subsidiaries under the Credit Agreement, any Designated
Financial Contract and the other Loan Documents (all of the foregoing being referred to
collectively as the “Guaranteed Obligations”). Upon failure by any Borrower or
any of their respective Affiliates, as applicable, to pay punctually any such amount, each
of the Guarantors agrees that it shall forthwith on demand pay such amount at the place
and in the manner specified in the Credit Agreement, any Designated Financial Contract or
the relevant Loan Document, as the case may be. Each of the Guarantors hereby agrees that
this Guaranty is an absolute, irrevocable and unconditional guaranty of payment and is not
a guaranty of collection. 

        SECTION
4.     Guaranty Unconditional. The obligations of each of the Guarantors hereunder shall be
unconditional and absolute and, without limiting the generality of the foregoing, shall
not be released, discharged or otherwise affected by: 

	 	        (A)          any
extension, renewal, settlement, indulgence, compromise, waiver or release of
               or with respect to the Guaranteed Obligations or any part thereof or any
               agreement relating thereto, or with respect to any obligation of any other
               guarantor of any of the Guaranteed Obligations, whether (in any such case)
by                operation of law or otherwise, or any failure or omission to enforce
any right,                power or remedy with respect to the Guaranteed Obligations or
any part thereof                or any agreement relating thereto, or with respect to any
obligation of any                other guarantor of any of the Guaranteed Obligations;  

	 	        (B)          any
modification or amendment of or supplement to the Credit Agreement, any
               Designated Financial Contract or any other Loan Document, including,
without                limitation, any such amendment which may increase the amount of,
or the interest                rates applicable to, any of the Obligations guaranteed
hereby;  

F-3  

	 	        (C)          any
release, surrender, compromise, settlement, waiver, subordination or
               modification, with or without consideration, of any other guaranties with
               respect to the Guaranteed Obligations or any part thereof, or any other
               obligation of any person or entity with respect to the Guaranteed
Obligations or                any part thereof, or any nonperfection or invalidity of any
direct or indirect                security, if any, for the Guaranteed Obligations;  

	 	        (D)          any
change in the corporate, partnership or other existence, structure or
               ownership of any Borrower or any other guarantor of any of the Guaranteed
               Obligations, or any insolvency, bankruptcy, reorganization or other
similar                proceeding affecting any Borrower or any other guarantor of the
Guaranteed                Obligations, or any of their respective assets or any resulting
release or                discharge of any obligation of any Borrower or any other
guarantor of any of the                Guaranteed Obligations;  

	 	        (E)          the
existence of any claim, setoff or other rights which the Guarantors may have
               at any time against any Borrower, any other guarantor of any of the
Guaranteed                Obligations, any Holder of Obligations or any other Person,
whether in                connection herewith or in connection with any unrelated
transactions, provided                that nothing herein shall prevent the assertion of
any such claim by separate                suit or compulsory counterclaim;  

	 	        (F)          the
enforceability or validity of the Guaranteed Obligations or any part thereof
               or the genuineness, enforceability or validity of any agreement relating
thereto                or with respect to any collateral securing the Guaranteed
Obligations or any                part thereof, or any other invalidity or
unenforceability relating to or against                an Borrower or any other guarantor
of any of the Guaranteed Obligations, for any                reason related to the Credit
Agreement, any Designated Financial Contract, any                other Loan Document, or
any provision of applicable law or regulation purporting                to prohibit the
payment by any Borrower or any other guarantor of the Guaranteed
               Obligations, of any of the Guaranteed Obligations;  

	 	        (G)          the
failure of the Lender to take any steps to perfect and maintain any security
               interest in, or to preserve any rights to, any security or collateral for
the                Guaranteed Obligations, if any;  

	 	        (H)          the
election by, or on behalf of, any one or more of the Holders of Obligations,
               in any proceeding instituted under Chapter 11 of Title 11 of the United
States                Code (11 U.S.C. 101 et seq.) (the “Bankruptcy Code”), of
the                application of Section 1111(b)(2) of the Bankruptcy Code;  

	 	        (I)          any
borrowing or grant of a security interest by any Borrower, as
               debtor-in-possession, under Section 364 of the Bankruptcy Code;  

	 	        (J)          the
disallowance, under Section 502 of the Bankruptcy Code, of all or any
               portion of the claims of any of the Holders of Obligations or the Lender
for                repayment of all or any part of the Guaranteed Obligations;  

F-4  

	 	        (K)          the
failure of any other Guarantor to sign or become party to this Guaranty or
               any amendment, change, or reaffirmation hereof; or  

	 	        (L)          any
other act or omission to act or delay of any kind by any Borrower, any other
               guarantor of the Guaranteed Obligations, the Lender, any Holder of
Obligations                or any other Person or any other circumstance whatsoever which
might, but for                the provisions of this Section 4, constitute a legal or
equitable discharge of                any Guarantor’s obligations hereunder.  

        SECTION
5.     Discharge Only Upon Payment In Full: Reinstatement In Certain Circumstances. Each of
the Guarantors’ obligations hereunder shall remain in full force and effect until
all Guaranteed Obligations shall have been paid in full in cash and the Commitments and
all Facility LCs issued under the Credit Agreement shall have terminated or expired. If
at any time any payment of the principal of or interest on any Advance, any Reimbursement
Obligation or any other amount payable by any Borrower or any other party under the
Credit Agreement, any Designated-Financial Contract or any other Loan Document is
rescinded or must be otherwise restored or returned upon the insolvency, bankruptcy or
reorganization of any Borrower or otherwise, each of the Guarantors’ obligations
hereunder with respect to such payment shall be reinstated as though such payment had
been due but not made at such time.  

        SECTION
6.     General Waivers. Each of the Guarantors irrevocably waives acceptance hereof,
presentment, demand or action on delinquency, protest, the benefit of any statutes of
limitations 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 Borrower, any other guarantor of the Guaranteed Obligations, or any other
Person.  

        SECTION
7.     Subordination of Subrogation; Subordination of Intercompany Indebtedness. 

	 	        (A)         Subordination
of Subrogation. Until the Guaranteed Obligations have been                indefeasibly
paid in full in cash, the Guarantors (i) shall have no right of
               subrogation with respect to such Guaranteed Obligations and (ii) waive any
right                to enforce any remedy which the Holders of Obligations, LC Issuers
or the Lender                now have or may hereafter have against any Borrower, any
endorser or any                guarantor of all or any part of the Guaranteed Obligations
or any other Person,                and the Guarantors waive any benefit of, and any
right to participate in, any                security or collateral given to the Holders
of Obligations, the LC Issuers and                the Lender to secure the payment or
performance of all or any part of the                Guaranteed Obligations or any other
liability of the Borrowers to the Holders of                Obligations or LC Issuers.
Should any Guarantor have the right, notwithstanding                the foregoing, to
exercise its subrogation rights, each Guarantor hereby                expressly and
irrevocably (A) subordinates any and all rights at law or in                equity to
subrogation, reimbursement, exoneration, contribution, indemnification                or
set off that the Guarantor may have to the indefeasible payment in full in
               cash of the Guaranteed Obligations, and (B) waives any and all defenses
               available to a surety, guarantor or accommodation co-obligor until the
               Guaranteed Obligations are indefeasibly paid in full in cash. Each
Guarantor                acknowledges and agrees that this subordination is intended to
benefit the                Lender and the Holders of Obligations and shall not limit or
otherwise affect                such Guarantor’s liability hereunder or the
enforceability of this                Guaranty, and that the Lender, the Holders of
Obligations and their respective                successors and assigns are intended third
party beneficiaries of the waivers and                agreements set forth in this
Section 7(A).  

F-5  

	 	        (B)          Subordination
of Intercompany Indebtedness. Each Guarantor agrees that any and                all
claims of such Guarantor against either any Borrower or any other Guarantor
               hereunder (each an “Obligor”) with respect to any “Intercompany
               Indebtedness” (as hereinafter defined), any endorser, obligor or any
other                guarantor of all or any part of the Guaranteed Obligations, or
against any of                its properties shall be subordinate and subject in right of
payment to the prior                payment, in full and in cash, of all Guaranteed
Obligations. Notwithstanding any                right of any Guarantor to ask, demand,
sue for, take or receive any payment from                any Obligor, all rights, liens
and security interests of such Guarantor, whether                now or hereafter arising
and howsoever existing, in any assets of any other                Obligor shall be and
are subordinated to the rights of the Holders of                Obligations and the
Lender in those assets. No Guarantor shall have any right to                possession of
any such asset or to foreclose upon any such asset, whether by                judicial
action or otherwise, unless and until all of the Guaranteed Obligations
               (other than contingent indemnity obligations) shall have been fully paid
and                satisfied (in cash) and all financing arrangements pursuant to any
Loan Document                or any Designated Financial Contract have been terminated.
If all or any part of                the assets of any Obligor, or the proceeds thereof,
are subject to any                distribution, division or application to the creditors
of such Obligor, whether                partial or complete, voluntary or involuntary,
and whether by reason of                liquidation, bankruptcy, arrangement,
receivership, assignment for the benefit                of creditors or any other action
or proceeding, or if the business of any such                Obligor is dissolved or if
substantially all of the assets of any such Obligor                are sold, then, and in
any such event (such events being herein referred to as                an “Insolvency
Event”), any payment or distribution of any kind or                character, either
in cash, securities or other property, which shall be payable                or
deliverable upon or with respect to any indebtedness of any Obligor to any
               Guarantor (“Intercompany Indebtedness”) shall be paid or
delivered                directly to the Lender for application on any of the Guaranteed
Obligations, due                or to become due, until such Guaranteed Obligations
(other than contingent                indemnity obligations) shall have first been fully
paid and satisfied (in cash).                Should any payment, distribution, security
or instrument or proceeds thereof be                received by the applicable Guarantor
upon or with respect to the Intercompany                Indebtedness after any Insolvency
Event and prior to the satisfaction of all of                the Guaranteed Obligations
(other than contingent indemnity obligations) and the                termination of all
financing arrangements pursuant to any Loan Document among                the Borrower
and the Holders of Obligations, such Guarantor shall receive and                hold the
same in trust, as trustee, for the benefit of the Holders of                Obligations
and shall forthwith deliver the same to the Lender, for the benefit                of the
Holders of Obligations, in precisely the form received (except for the
               endorsement or assignment of the Guarantor where necessary), for
application to                any of the Guaranteed Obligations, due or not due, and,
until so delivered, the                same shall be held in trust by the Guarantor as
the property of the Holders of                Obligations. If any such Guarantor fails to
make any such endorsement or                assignment to the Lender or any of its
officers or employees is irrevocably                authorized to make the same. Each
Guarantor agrees that until the Guaranteed                Obligations (other than the
contingent indemnity obligations) have been paid in                full (in cash) and
satisfied and all financing arrangements pursuant to any Loan                Document
among the Borrowers and the Holders of Obligations have been                terminated,
no Guarantor will assign or transfer to any Person (other than the                Lender)
any claim any such Guarantor has or may have against any Obligor.  

F-6  

        SECTION
8.     Contribution with Respect to Guaranteed Obligations. 

	 	        (A)           To
the extent that any Guarantor shall make a payment under this Guaranty (a
               “Guarantor Payment”) which, taking into account all other
Guarantor                Payments then previously or concurrently made by any other
Guarantor, exceeds                the amount which otherwise would have been paid by or
attributable to such                Guarantor if each Guarantor had paid the aggregate
Guaranteed Obligations                satisfied by such Guarantor Payment in the same
proportion as such                Guarantor’s “Allocable Amount” (as
defined below) (as determined                immediately prior to such Guarantor Payment)
bore to the aggregate Allocable                Amounts of each of the Guarantors as
determined immediately prior to the making                of such Guarantor Payment,
then, following indefeasible payment in full in cash                of the Guaranteed
Obligations and termination of the Credit Agreement and the                Designated
Financial Contracts, such Guarantor shall be entitled to receive
               contribution and indemnification payments from, and be reimbursed by, each
other                Guarantor for the amount of such excess, pro rata based upon their
respective                Allocable Amounts in effect immediately prior to such Guarantor
Payment.  

	 	        (B)        As
of any date of determination, the “Allocable Amount” of any
               Guarantor shall be equal to the maximum amount of the claim which could
then be                recovered from such Guarantor under this Guaranty without
rendering such claim                voidable or avoidable under Section 548 of Chapter 11
of the Bankruptcy Code or                under any applicable state Uniform Fraudulent
Transfer Act, Uniform Fraudulent                Conveyance Act or similar statute or
common law.  

	 	        (C)        This
Section 8 is intended only to define the relative rights of the Guarantors,
               and nothing set forth in this Section 8 is intended to or shall impair the
               obligations of the Guarantors, jointly and severally, to pay any amounts
as and                when the same shall become due and payable in accordance with the
terms of this                Guaranty.  

	 	        (D)        The
parties hereto acknowledge that the rights of contribution and
               indemnification hereunder shall constitute assets of the Guarantor to
which such                contribution and indemnification is owing.  

F-7  

	 	        (E)       The
rights of the indemnifying Guarantors against other Guarantors under this
               Section 8 shall be exercisable upon the full and indefeasible payment of
the                Guaranteed Obligations in cash and the termination of the Credit
Agreement and                the Designated Financial Contracts.  

        SECTION
9.     Stay of Acceleration. If acceleration of the time for payment of any amount payable by
the Borrowers under the Credit Agreement, any Designated Financial Contract or any other
Loan Document is stayed upon the insolvency, bankruptcy or reorganization of any
Borrower, all such amounts otherwise subject to acceleration under the terms of the
Credit Agreement, any Designated Financial Contract or any other Loan Document shall
nonetheless be payable by each of the Guarantors hereunder forthwith on demand by the
Lender.  

        SECTION
10.    Notices. All notices, requests and other communications to any party hereunder shall
be given in the manner prescribed in Article 14 of the Credit Agreement with respect to
the Lender at its notice address therein and with respect to any Guarantor at the address
set forth below or such other address or telecopy number as such party may hereafter
specify for such purpose by notice to the Lender in accordance with the provisions of
such Article 14.  

	 	
Notice
Address for Guarantors:  

	 	
c/o
Johnson Outdoors Inc.
555 Main Street, Suite 28
Racine, WI  53403
Attention:  David Harrington

Phone:  262/631-6634
Fax:  262/631-6608 

        SECTION 11.    
No Waivers. No failure or delay by the Lender or any Holder of Obligations in exercising
any right, power or privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies provided in this
Guaranty, the Credit Agreement, any Designated Financial Contract and the other Loan
Documents shall be cumulative and not exclusive of any rights or remedies provided by law. 

        SECTION
12.    Successors and Assigns. This Guaranty is for the benefit of the Lender and the Holders
of Obligations and their respective successors and permitted assigns, provided, that no
Guarantor shall have any right to assign its rights or obligations hereunder without the
consent of the Lender, and any such assignment in violation of this Section 12 shall be
null and void; and in the event of an assignment of any amounts payable under the Credit
Agreement, any Designated Financial Contract or the other Loan Documents in accordance
with the respective terms thereof, the rights hereunder, to the extent applicable to the
indebtedness so assigned, may be transferred with such indebtedness. This Guaranty shall
be binding upon each of the Guarantors and their respective successors and assigns. 

F-8  

        SECTION
13.    Changes in Writing. Other than in connection with the addition of additional
Subsidiaries, which become parties hereto by executing a supplement hereto in the form
attached as Annex I, neither this Guaranty nor any provision hereof may be changed,
waived, discharged or terminated orally, but only in writing signed by each of the
Guarantors and the Lender under the Credit Agreement. 

        SECTION
14.    GOVERNING LAW. THIS GUARANTY SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS
(INCLUDING, WITHOUT LIMITATION, 735 ILCS 105/5-1 ET SEQ, BUT OTHERWISE WITHOUT REGARD TO
THE CONFLICT OF LAWS PROVISIONS) OF THE STATE OF ILLINOIS, BUT GIVING EFFECT TO FEDERAL
LAWS APPLICABLE TO NATIONAL BANKS. 

        SECTION
15.    CONSENT TO JURISDICTION; SERVICE OF PROCESS; JURY TRIAL. 

	 	        (A)          CONSENT
TO JURISDICTION. EACH GUARANTOR HEREBY IRREVOCABLY SUBMITS TO THE
               NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE
COURT                SITTING IN CHICAGO, ILLINOIS IN ANY ACTION OR PROCEEDING ARISING OUT
OF OR                RELATING TO THIS GUARANTY AND EACH GUARANTOR HEREBY IRREVOCABLY
AGREES THAT ALL                CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE
HEARD AND DETERMINED IN                ANY SUCH COURT AND IRREVOCABLY WANES ANY OBJECTION
IT MAY NOW OR HEREAFTER HAVE                AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN SUCH A COURT                OR THAT SUCH COURT IS AN INCONVENIENT
FORUM. NOTHING HEREIN SHALL LIMIT THE                RIGHT OF THE LENDER OR THE LC ISSUER
TO BRING PROCEEDINGS AGAINST ANY GUARANTOR                IN THE COURTS OF ANY OTHER
JURISDICTION. ANY JUDICIAL PROCEEDING BY ANY                GUARANTOR AGAINST THE LENDER
OR THE LC ISSUER OR ANY AFFILIATE OF THE LENDER, OR                THE LC ISSUER
INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING                OUT OF,
RELATED TO, OR CONNECTED WITH THIS GUARANTY OR ANY OTHER LOAN DOCUMENT
               SHALL BE BROUGHT ONLY IN A COURT IN CHICAGO, ILLINOIS OR THE CITY IN WHICH
THE                PRINCIPAL OFFICE OF THE LENDER OR AFFILIATE, AS THE CASE MAY BE, IS
LOCATED.  

	 	        (B)          WAIVER
OF JURY TRIAL. EACH GUARANTOR HEREBY WAIVES TRIAL BY JURY IN ANY JUDICIAL
               PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING
IN                TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR
CONNECTED                WITH THIS GUARANTY OR ANY OTHER LOAN DOCUMENT OR THE
RELATIONSHIP ESTABLISHED                THEREUNDER.  

F-9  

        SECTION
16. No Strict Construction. The parties hereto have participated jointly in the
negotiation and drafting of this Guaranty. In the event an ambiguity or question of intent
or interpretation arises, this Guaranty shall be construed as if drafted jointly by the
parties hereto and no presumption or burden of proof shall arise favoring or disfavoring
any party by virtue of the authorship of any provisions of this Guaranty. 

        SECTION
17.    Taxes, Expenses of Enforcement, etc. 

	 	        (A)       Taxes.  

	 	        (i)                 All
payments by any Guarantor to or for the account of the Lender or the LC
               Issuer hereunder or under any Note or Facility LC Application shall be
made free                and clear of and without deduction for any and all Taxes. If any
Guarantor shall                required by law to deduct any Taxes from or in respect of
any sum payable                hereunder to the Lender or the LC Issuer, (a) 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 17(A)) the Lender or                the LC Issuer (as the case may be)
receives an amount equal to the sum it would                have received had no such
deductions been made, (b) such Guarantor shall make                such deductions, (c)
such Guarantor shall pay the full amount deducted to the                relevant
authority in accordance with applicable law and (d) such Guarantor                shall
furnish to the Lender the original copy of a receipt evidencing payment
               thereof within thirty (30) days after such payment is made.  

	 	        (ii)           In
addition, the Guarantors hereby agree to pay any present or future stamp or
               documentary taxes and any other excise or property taxes, charges or
similar                levies which arise from any payment made hereunder or under any
Note or Facility                LC Application or from the execution or delivery of, or
otherwise with respect                to, this Guaranty or any Note or Facility LC
Application (“Other                Taxes”).  

	 	        (iii)          The
Guarantors hereby agree to indemnify the Lender and the LC Issuer for the
               full amount of Taxes or Other Taxes (including, without limitation, any
Taxes or                Other Taxes imposed on amounts payable under this Section 17(A))
paid by the                Lender or the LC Issuer and any liability (including
penalties, interest and                expenses) arising therefrom or with respect
thereto. Payments due under this                indemnification shall be made within
thirty (30) days of the date the Lender or                the LC Issuer makes demand
therefor.  

	 	        (B)          Expenses
of Enforcement, Etc. Subject to the terms of the Credit Agreement,                after
the occurrence of a Default under the Credit Agreement, the Lender may
               commence enforcement proceedings with respect to the Guaranteed
Obligations. The                Guarantors agree to reimburse the Lender and the Holders
of Obligations for any                reasonable costs and out-of-pocket expenses
(including reasonable                attorneys’ fees and time charges of attorneys
for the Lender and the                Holders of Obligations, which attorneys may be
employees of the Lender or the                Holders of Obligations) paid or incurred by
the Lender or any Holders of                Obligation in connection with the collection
and enforcement of amounts due                under the Loan Documents, including without
limitation this Guaranty. The Lender                agrees to distribute payments
received from any of the Guarantors hereunder to                the Holders of
Obligations on a pro rata basis for application in accordance                with the
terms of the Credit Agreement.  

F-10  

        SECTION
18.    Setoff. At any time after all or any part of the Guaranteed Obligations have become
due and payable (by acceleration or otherwise), each Holder of Obligations and the Lender
may, without notice to any Guarantor and regardless of the acceptance of any security or
collateral for the payment hereof, appropriate and apply toward the payment of all or any
part of the Guaranteed Obligations (i) any indebtedness due or to become due from such
Holder of Obligations or the Lender to any Guarantor, and (ii) any moneys, credits or
other property belonging to any Guarantor, at any time held by or coming into the
possession of such Holder of Obligations or the Lender or any of their respective
affiliates.  

        SECTION
19.    Financial Information. Each Guarantor hereby assumes responsibility for keeping
itself informed of the financial condition of the Borrowers and any and all endorsers
and/or other Guarantors of all or any part of the Guaranteed Obligations, and of all the
circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations, or any
part thereof, that diligent inquiry would reveal, and each Guarantor hereby agrees that
none of the Holders of Obligations or the Lender shall have any duty to advise such
Guarantor of information known to any of them regarding such condition or any such
circumstances. In the event any Holder of Obligations or the Lender, in its sole
discretion, undertakes at any time or from time to time to provide any such information
to a Guarantor, such Holder of Obligations or the Lender shall be under no obligation (i)
to undertake any investigation not a part of its regular business routine, (ii) to
disclose any information which such Holder of Obligations or the Lender, pursuant to
accepted or reasonable commercial finance or banking practices, wishes to maintain
confidential or (iii) to make any other or future disclosures of such information or any
other information to such Guarantor.  

        SECTION
20.    Severability. Wherever possible, each provision of this Guaranty shall be interpreted
in such manner as to be effective and valid under applicable law, but if any provision of
this Guaranty shall be prohibited by or invalid under such law, such provision shall be
ineffective to the extent of such prohibition or invalidity without invalidating the
remainder of such provision or the remaining provisions of this Guaranty.  

        SECTION
21.    Merger. This Guaranty represents the final agreement of each of the Guarantors with
respect to the matters contained herein and may not be contradicted by evidence of prior
or contemporaneous agreements, or subsequent oral agreements, between the Guarantor and
any Holder of Obligations or the Lender.  

F-11  

        SECTION
22.    Headings. Section headings in this Guaranty are for convenience of reference only and
shall not govern the interpretation of any provision of this Guaranty.  

REMAINDER OF PAGE
INTENTIONALLY BLANK 

F-12  

        IN
WITNESS WHEREOF, the Initial Guarantors have caused this Guaranty to be duly executed by
its authorized officer as of the day and year first above written. 

		LEISURE LIFE LIMITED

		By:   	  

		Its:   	 

		OLD TOWN CANOE COMPANY

		By:   	  

		Its:   	 

		TECHSONIC INDUSTRIES, INC.

		By:   	  

		Its:   	 

		UNDER SEA INDUSTRIES, INC.

		By:   	  

		Its:   	 

F-13  

ANNEX I TO GUARANTY 

        Reference
is hereby made to the Guaranty (the “Guaranty”) made as of the 29th
day of October, 2004, by and among Leisure Life Limited, a Michigan corporation, Old Town
Canoe Company, a Delaware corporation, Techsonic Industries, Inc., an Alabama corporation,
Under Sea Industries, Inc., a Delaware corporation, and Uwatec USA, Inc., a Maine
corporation (the “Initial Guarantors” and along with any additional Subsidiaries
of the Borrower, which become parties thereto and together with the undersigned, the
“Guarantors”) in favor of the Lender, for the ratable benefit of the Holders of
Obligations, under the Credit Agreement. Capitalized terms used herein and not defined
herein shall have the meanings given to them in the Guaranty. By its execution below, the
undersigned [NAME OF NEW GUARANTOR], a [corporation] [partnership] [limited liability
company], agrees to become, and does hereby become, a Guarantor under the Guaranty and
agrees to be bound by such Guaranty as if originally a party thereto. By its execution
below, the undersigned represents and warrants as to itself that all of the
representations and warranties contained in Section 2 of the Guaranty are true and correct
in all respects as of the date hereof. 

        IN
WITNESS WHEREOF, [NAME OF NEW GUARANTOR], a [corporation] [partnership] [limited liability
company] has executed and delivered this Annex I counterpart to the Guaranty as of this
____ day of _____________, _____. 

		[NAME OF NEW GUARANTOR]

		By:   	  

		Its:   	 

F-14  

Exhibit G  

Form of Assumption
Letter  

____________________,
20___ 

LaSalle Bank National Association
411
E. Wisconsin Avenue
Milwaukee, WI 53202  

Ladies and Gentlemen:  

        Reference
is made to that certain Revolving Credit Agreement dated as of October 29, 2004 by and
among Johnson Outdoors Inc., the Subsidiary Borrowers from time to time parties thereto,
and LaSalle Bank National Association (having its principal office in Chicago, IL) (as the
same may be amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”). Terms defined in the Credit Agreement and used herein are
used herein as defined therein. 

        The
undersigned, ______________________ (the “Subsidiary”), a ______________
[corporation], wishes to become a “Subsidiary Borrower” under the Credit
Agreement, and accordingly hereby agrees that from the date hereof it shall become a
“Subsidiary Borrower” under the Credit Agreement and agrees that from the date
hereof and until the payment in full of the principal of and interest on all Advances made
to it under the Credit Agreement and performance of all of its other obligations
thereunder, and termination hereunder of its status as a “Subsidiary Borrower”
as provided below, it shall perform, comply with and be bound by each of the provisions of
the Credit Agreement which are stated to apply to a “Borrower” or a
“Subsidiary Borrower.” Without limiting the generality of the foregoing, the
Subsidiary hereby represents and warrants that: (i) each of the representations and
warranties set forth in Sections 6.1, 6.2, 6.3 and 6.18 of the Credit Agreement is hereby
made by such Subsidiary on and as of the date hereof as if made on and as of the date
hereof and as if such Subsidiary is the “Borrower” and this Assumption Letter is
the “Agreement” referenced therein, and (ii) it has heretofore received a true
and correct copy of the Credit Agreement (including any modifications thereof or
supplements or waivers thereto) as in effect on the date hereof. In addition, the
Subsidiary hereby authorizes each of the Borrowers to act on its behalf as and to the
extent provided for in Article II of the Credit Agreement in connection with the selection
of Types and Interest Periods for Advances and the conversion and continuation of
Advances. 

        The
Subsidiary further represents and warrants: 

        (A)     Organization
and Corporate Powers. Such Subsidiary (i) is a company duly           formed and
validly existing and in good standing under the laws of the state of           its
organization (such jurisdiction being hereinafter referred to as the           “Home
State”) and (ii) has the requisite power and authority to own           its property
and assets and to carry on its business substantially as now           conducted except
where the failure to have such requisite authority would not           reasonably be
expected to have a Material Adverse Effect.  

G-1 

        (B)     Binding
Effect. Each Loan Document executed by such Subsidiary is the           legal, valid
and binding obligation of such Subsidiary enforceable in accordance           with its
respective terms, except as enforceability may be limited by           bankruptcy,
insolvency or similar laws affecting the enforcement of           creditors’ rights
generally and general equitable principles.  

        (C)     No
Conflict; Government Consent. Neither the execution and delivery by           such
Subsidiary of the Loan Documents to which it is a party, nor the           consummation
by it of the transactions therein contemplated to be consummated-by           it, nor
compliance by such Subsidiary with the provisions thereof will violate           any
material law, rule, regulation, order, writ, judgment, injunction, decree or
          award binding on such Subsidiary or any of its Subsidiaries or such
          Subsidiary’s or any of its Subsidiaries’ memoranda or articles of
          association or the provisions of any indenture, instrument or agreement to
which           such Subsidiary or any of its Subsidiaries is a party or is subject, or
by which           it, or its property, is bound, or conflict with or constitute a
default           thereunder, or result in the creation or imposition of any lien in, of
or on the           property of such Subsidiary or any of its Subsidiaries pursuant to
the terms of           any such indenture, instrument or agreement in any such case which
violation,           conflict, default, creation or imposition could not reasonably be
expected to           have a Material Adverse Effect. No order, consent, approval,
license,           authorization, or validation of, or filing, recording or registration
with, or           exemption by, any governmental authority is required to authorize, or
is           required in connection with the execution, delivery and performance of, or
the           legality, validity, binding effect or enforceability of, any of the Loan
          Documents, except for such as have been obtained or made.  

        So
long as the principal of and interest on all Advances made to the Subsidiary Borrower
under the Credit Agreement shall have been repaid or paid in full, all Facility LCs issued
for the account of the Subsidiary Borrower have expired or been returned and terminated
and all other obligations of the Subsidiary Borrower under this Agreement shall have been
fully performed, the Company may, by not less than five (5) Business Days’ prior
notice to the Lender, terminate its status as a “Subsidiary Borrower.” 

        CHOICE
OF LAW. THIS ASSUMPTION LETTER SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS
(INCLUDING 735 ILCS 105/5-1 ET SEQ. BUT OTHERWISE WITHOUT REGARD TO CONFLICTS OF LAW
PROVISIONS) OF THE STATE OF ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO
NATIONAL BANKS. 

        IN
WITNESS WHEREOF, the Subsidiary has duly executed and delivered this Assumption Letter as
of the date and year first above written. 

		[Name of Subsidiary Borrower]

		By:  	  

		Title:  	 
		
Address for Notices under the Credit Agreement:

G-2 

Consented to: 

	JOHNSON OUTDOORS INC.

	
	By:   	  
	
		Name:

Title:	

G-3 

Pricing Schedule 

		LEVEL I
STATUS 
	LEVEL II
STATUS 
	LEVEL III
STATUS 
	LEVEL IV
STATUS 
	LEVEL V
STATUS 

	
Applicable Margin	 	 	 	0.0	%	 	0.0	%	 	0.0	%	 	0.0	%	 	0.0	%
	  (Floating Rate)	 	 
	
Applicable Margin	 	 	 	1.00	%	 	1.25	%	 	1.50	%	 	1.75	%	 	2.00	%
	  (Eurocurrency Rate)	 	 
	
Applicable Performance	 	 	 	0.500	%	 	0.625	%	 	0.750	%	 	0.875	%	 	1.00	%
	  LC Fee	 	 
	
Applicable Commitment	 	 	 	.20	%	 	.25	%	 	0.30	%	 	0.35	%	 	0.40	%
	  Fee Rate	 	 

For the purposes of this Schedule,
the following terms have the following meanings, subject to the final paragraph of this
Schedule: 

        “Financials”
means the annual or quarterly financial statements of the Company delivered pursuant to
Section 6.1.1 or 6.1.2, respectively. 

        “Level
1 Status” exists at any date if, as of the last day of the fiscal quarter of
the Company referred to in the most recent Financials, the Leverage Ratio (Pricing) on
such date is less than 2.25 to 1.00. 

        “Level
II Status” exists at any date if, on such date, (i) the Company has not
qualified for Level I Status and (ii) as of the last day of the fiscal quarter of the
Company referred to in the most recent Financials, the Leverage Ratio (Pricing) on such
date is greater than or equal to 2.25 to 1.00 and less than 2.75 to 1.00. 

        “Level
III Status” exists at any date if, on such date, (i) the Company has not
qualified for Level I Status or Level II Status and (ii) as of the last day of the fiscal
quarter of the Company referred to in the most recent Financials, the Leverage Ratio
(Pricing) on such date is greater than or equal to 2.75 to 1.00 and less than 3.25 to
1.00. 

        “Level
IV Status” exists at any date if, on such date, (i) the Company has not
qualified for Level I Status, Level II Status or Level III Status and (ii) as of the last
day of the fiscal quarter of the Company referred to in the most recent Financials, the
Leverage Ratio (Pricing) on such date is greater than or equal to 3.25 to 1.00 and less
than 3.75 to 1.00. 

        “Level
V Status” exists at any date if, on such date, the Company has not qualified
for Level I Status, Level II Status, Level III Status or Level IV Status. 

        “Leverage
Ratio (Pricing)” means, as of any date of determination, the Leverage Ratio
as of the last day of the most recently completed fiscal quarter, exclusive of the
adjustments described in clauses (vi) through (viii) of the definition of
“EBITDA”, but inclusive of the adjustments in respect of the Identified Plants
to the extent permitted under the proviso in the definition of “EBITDA”. 

        “Status”
means Level I Status, Level II Status, Level III Status, Level IV Status, or Level V
Status. 

        The
Applicable Margin, the Applicable Commitment Fee Rate and the Applicable Performance LC
Fee shall be determined in accordance with the foregoing table based on the Company’s
Status as reflected in the then most recent Financials. Adjustments, if any, to the
Applicable Margin, the Applicable Commitment Fee Rate or the Applicable Performance Fee
shall be effective as of the date the Lender has received the applicable Financials. If
the Company fails to deliver the Financials to the Lender at the time required pursuant to
Section 6.1.1 or 6.1.2, as applicable, then the Applicable Margin, the
Applicable Commitment Fee Rate and the Applicable Performance LC Fee shall be the highest
Applicable Margin, Applicable Commitment Fee Rate and Applicable Performance LC Fee set
forth in the foregoing table until the fifth Business Day following the date such
Financials are so delivered. 

        Notwithstanding
anything to the contrary herein, the Applicable Margin, the Applicable Commitment Fee Rate
and the Applicable Performance LC Fee shall be based on Level III Status for the period
commencing on the Closing Date through and including the first day of the calendar month
beginning immediately after the date the Lender has received the Financials for the period
ending September 30, 2004. 

	
Commitment
Schedule  

	LENDER  	COMMITMENT 

	LaSalle Bank National Association  	$30,000,000

	
Eurocurrency Payment
Office Schedule  

	
EUROCURRENCY
PAYMENT OFFICES OF THE LENDER  

	 Currency  	Eurocurrency
Payment Office 

	         All  	LaSalle
Bank National Association
135 South LaSalle
Chicago, IL  60603

Schedule 1.1  

Subsidiary Borrowers  

	 	
None.  

Schedule 5.4  

Financial Statements  

	 	
See
attached.  

Schedule 5.7  

Litigation  

	 	
None.  

Schedule 5.8  

Subsidiaries  

		
	Johnson Outdoors Canada Inc.	Canada
	Old Town Canoe Company	Delaware
	    Leisure Life Limited	Michigan
	Scubapro Scandinavia AB (5)	Sweden
	Techsonic Industries, Inc.	Alabama
	Under Sea Industries, Inc.	Delaware
	    JWA Holding B.V	Netherlands
	        Johnson Beteiligungsgesellschaft GmbH	Germany
	          Johnson Outdoors V GmbH (5)	Germany
	          Scubapro Taucherauser GmbH	Germany
	          Uwatec AG	Switzerland
	              Uwatec USA, Inc.	Maine
	              Scubapro Asia Pacific Ltd.	Hong Kong
	              Uwatec Batam	Indonesia
	      Scubapro Taucheraustrustungengesellschaft GmbH (5)	Austria
	      Scubapro Asia, Ltd.	Japan
	      Scubapro Espana, S.A.(3)	Spain
	      Scubapro Eu AG	Switzerland
	      Scubapro Europe Benelux, S.A	Belgium
	          Johnson Outdoors France	France
	              Scuba/Uwatec S.A	France
	      Scubapro Europe S.r.l	Italy
	          Scubapro Italy S.r.l	Italy
	      Scubapro (UK) Ltd.(4)	United Kingdom
	      Scubapro-Uwatec Australia Pty. Ltd.	Australia
	      Johnson Outdoors Watercraft UK	United Kingdom
	Johnson Outdoors Watercraft Ltd.	New Zealand
	UWATEC USA, Inc. (5)	Maine

	(1) 	          Unless
otherwise indicated in brackets, each company does business only under           its
legal name. 

	(2) 	          Unless
otherwise indicated by footnote, each company is a wholly-owned           subsidiary of
Johnson Outdoors Inc. (through direct or indirect ownership). 

	(3) 	          Percentage
of stock owned is 98%. 

	(4) 	          Percentage
of stock owned is 99%. 

	(5) 	          Subsidiary
is currently inactive or in liquidation 

Schedule 5.14  

ERISA Matters  

	 	
None.  

Schedule 5.16 

Environmental Matters 

None. 

Schedule 6.12  

Existing Indebtedness  

		
	Indebtedness per Section 6.12.2 	 
	Johnson Outdoors Canada Inc.	C$500,000 
	Scubapro Europe srl	(euro)191,000 
	Scubapro Italy srl	(euro)2,777,400 
	UWATEC AG	SFr 4,000,000 
	Scuba/UWATEC SA	(euro)700,000 
	Scubapro (UK) Ltd	(pound)10,000 
	

Indebtedness per Section 6.12.3 	 
	Johnson Outdoors Canada Inc.	$2,000,000 
	Johnson Outdoors Watercraft Ltd	$1,000,000 
	Scubapro Uwatec Australia Pty. Ltd.	$300,000 
	Johnson Outdoors France	$250,000 

			
	Beneficiary 	Amount  	Expiration  
	
The Travelers Indemnity Company	$666,930 	07/01/2005 
	Safeco Insurance Company	$100,100 	08/15/2005 
	Lumbermen's Mutual Casualty Company	$122,000 	08/25/2005 
	Lumbermen's Mutual Casualty Company	$265,560 	08/25/2005 
	Lumbermen's Mutual Casualty Company	$266,312 	08/25/2005 
	Lumbermen's Mutual Casualty Company	$285,440 	08/25/2005 

	 	
All
letters of credits are issued by Bank One, N.A.  

Schedule 6.15  

Existing Investments  

	 	
None
except for equity investment in Subsidiaries as detailed on Schedule 5.8 and cash
equivalents permitted under 6.15.1  

Schedule 6.16  

Existing Liens  

	 	
NoneMASTER AMENDMENT 

        MASTER
AMENDMENT, dated as of October 29, 2004 (the “Amendment”), to each of the
following agreements entered into as of October 20, 2004 and closed on October 25, 2004,
between WIDEPOINT CORPORATION, a corporation organized and existing under the laws
of the State of Delaware (“WIDEPOINT” or the
“Company”), and Barron Partners L.P., a Delaware limited
partnership (hereinafter referred to collectively as
“Investor”): (i) the Preferred Stock Purchase Agreement
(the “Purchase Agreement”); (ii) the Registration Rights Agreement (the
“Registration Rights Agreement”); (iii) the Certificate of Designations, Rights
and Preferences relating to the Company’s Series A Preferred Stock; (iv) the Warrant
Agreement; and (v) the Escrow Agreement. All of the foregoing agreements are hereinafter
collectively referred to as the “Agreements.” 

PRELIMINARY STATEMENT: 

        WHEREAS,
the Investor has already purchased from the Company as of October 25, 2004, upon the terms
and subject to the conditions of the Purchase Agreement, Two Million Dollars
($2,000,000.00) worth of Series A Preferred Stock of the Company (the “Initial
Preferred Stock”), with such series of preferred stock being as described in the
Certificate of Designations, Rights and Preferences attached as Exhibit A to the
Purchase Agreement (the “Preferred Stock”), with the Initial
Preferred Stock being convertible at any time into an aggregate of 11,428,570 shares of
common stock of the Company, par value $0.001 per share (the “Common Stock”). In
addition, the Company issued Common Stock Purchase Warrants (the “First
Warrants”) to the Investor to purchase up to an additional 5,714,286 shares
of Common Stock of the Company at an exercise price of forty cents ($0.40) per common
share; and 

        WHEREAS,
the Investor wishes to purchase from the Company, upon the terms and subject to the
conditions of this Amendment, an additional One Million Five Hundred Eighty Thousand
Dollars ($1,580,000.00) worth of Preferred Stock, with additional warrants to purchase
additional shares of Common Stock, all as set forth in greater detail herein; and 

        WHEREAS,
the parties intend to memorialize the purchase and sale of such additional shares of
Preferred Stock and the additional warrants. 

        NOW,
THEREFORE, in consideration of the mutual covenants and premises contained herein, and
for other good and valuable consideration, the receipt and adequacy of which are hereby
conclusively acknowledged, the parties hereto, intending to be legally bound, agree as
follows: 

PREFERRED STOCK
PURCHASE AGREEMENT BETWEEN
WIDEPOINT CORPORATION AND BARRON PARTNERS LP  
PAGE 1 OF 6  

I. INCORPORATION BY
REFERENCE, SUPERSEDER AND DEFINITIONS 

1.1     Incorporation by
Reference. The foregoing recitals and the Exhibits attached hereto and referred to
herein, are hereby acknowledged to be true and accurate, and are incorporated herein by
this reference. 

1.2     Superseder. This
Amendment, to the extent that it is inconsistent with any other instrument or
understanding among the parties governing the affairs of the Company, shall supersede such
instrument or understanding to the fullest extent permitted by law, including being an
amendment to each and all of the Agreements. In the event of any conflict between this
Amendment and any of the Agreements, the provisions of this Amendment shall supercede and
control over any inconsistent provisions of the Agreements. A copy of this Amendment shall
be filed at the Company’s principal office. 

1.3     Certain Definitions. For
purposes of this Amendment, all capitalized terms used in this Amendment shall have the
same meanings as given to such terms in the Agreements unless otherwise provided herein. 

II.          SALE
AND PURCHASE OF WIDEPOINT PREFERRED STOCK AND WARRANTS PURCHASE PRICE 

2.1     Sale of Additional Preferred
Stock and Issuance of Additional Warrants.  

        (a)                 Upon
the terms and subject to the conditions set forth herein, and in accordance
          with applicable law, the Company agrees to sell to the Investor, and the
          Investor agrees to purchase from the Company, on October 29, 2004 (the
          “Additional Closing Date”) 902,857 shares of Preferred Stock (the
          “Additional Preferred Stock”) and additional warrants (the
          “Additional Warrants”) to purchase 4,514,285 shares of Common Stock,
          at an exercise price of $0.40 per share (the “Additional Warrants”)
          for the aggregate purchase price (the “Purchase Price”) of One
Million           Five Hundred Eighty Thousand Dollars ($1,580,000.00). The Purchase
Price shall           be paid by the Investor to the Company on or before the Additional
Closing Date           by a wire transfer of the Purchase Price to the Company or the
Escrow Agent. The           Company shall cause the Additional Preferred Stock and the
Additional Warrants           to be issued to the Investor upon the receipt by the
Company of the Purchase           Price. The Company shall register the shares of Common
Stock into which the           Additional Preferred Stock is convertible pursuant to the
terms and conditions           of the Registration Rights Agreement, subject to the
provisions of Section 3.3.  

PREFERRED STOCK
PURCHASE AGREEMENT BETWEEN
WIDEPOINT CORPORATION AND BARRON PARTNERS LP  
PAGE 2 OF 6  

        (b)                 The
Additional Preferred Stock shall be convertible by the Investor into an
          aggregate total of 9,028,570 shares of Common Stock (the “Additional
          Conversion Shares”); provided, however, that the Investor shall not be
          entitled to convert any shares of the Preferred Stock (consisting of both the
          Initial Preferred Stock and the Additional Preferred Stock) into shares of
          Common Stock that would result in beneficial ownership by the Investor and its
          affiliates of more than 4.99% of the then outstanding number of shares of
Common           Stock on such date; provided, however, that the Investor may revoke the
          restriction described in this paragraph upon sixty-one (61) days prior written
          notice from the Investor to the Company, but in such event the Investor hereby
          agrees that no person or entity (including but not limited to the Investor and
          its affiliates) shall have any right to vote the number of shares of Common
          Stock, including but not limited to all Conversion Shares and the Additional
          Conversion Shares, then held by or at the direction of or for the benefit of
the           Investor and/or its affiliates which would result in the Investor and/or
its           affiliates having the right to vote more than twenty-two percent (22%) of
the           total votes able to be voted at any time by all the then outstanding shares
of           voting stock of the Company. For the purposes of the immediately preceding
          sentence, beneficial ownership shall be determined in accordance with Section
          13(d) of the Securities Exchange Act of 1934, as amended, and Regulation 13d-3
          thereunder.  

        (c)                 Upon
execution and delivery of this Agreement and the Company’s receipt of           the
Purchase Price from the escrow agent pursuant to the terms of the Escrow
          Agreement, the Company shall issue to the Investor the Additional Warrant to
          purchase an aggregate of 4,514,285 shares of Common Stock at an exercise price
          of $0.40 per share, all pursuant to the terms and conditions of the form of
          Warrant previously issued by the Company to the Investor; provided, however,
          that the Investor shall not be entitled to exercise the Additional Warrant and
          receive shares of Common Stock that would result in beneficial ownership by the
          Investor and its affiliates of more than 4.99% of the then outstanding number
of           shares of Common Stock on such date; provided, however, that the Investor
may           revoke the restriction described in this paragraph upon sixty-one (61) days
          prior written notice from the Investor to the Company, but in such event the
          Investor hereby agrees that no person or entity (including but not limited to
          the Investor and its affiliates) shall have any right to vote the number of
          shares of Common Stock, including but not limited to all shares of Common Stock
          issued upon exercise of the Warrant and the Additional Warrant, then held by or
          at the direction of or for the benefit of the Investor and/or its affiliates
          which would result in the Investor and/or its affiliates having the right to
          vote more than twenty-two percent (22%) of the total votes able to be voted at
          any time by all the then outstanding shares of voting stock of the Company. For
          the purposes of the immediately preceding sentence, beneficial ownership shall
          be determined in accordance with Section 13(d) of the Securities Exchange Act
of           1934, as amended, and Regulation 13d-3 thereunder.  

2.2     Purchase Price. The
Purchase Price shall be delivered by the Investor in the form of a check or wire transfer
made payable to the Company in United States Dollars from the Investor to the escrow agent
pursuant to the Escrow Agreement on the Closing Date. 

PREFERRED STOCK
PURCHASE AGREEMENT BETWEEN
WIDEPOINT CORPORATION AND BARRON PARTNERS LP  
PAGE 3 OF 6  

III. OTHER CHANGES 

3.1     Reimbursement of Due
Diligence Expenses. Section 5.10 of the Purchase Agreement is amended to
provide that due diligence expenses shall not exceed $16,000, subject to Investor
providing proof of payment of such expenses to the Company. 

3.2     Reimbursement of Legal
Expenses. Section 5.11 of the Purchase Agreement is amended to provide that
legal expenses shall not exceed $8,000, subject to Investor providing proof of payment of
such expenses to the Company. 

3.3     Reservation Of Common
Stock. The shares of Common Stock underlying the Additional Preferred Stock
and the Additional Warrant are subject to the shareholders of the Company approving an
increase in the total number of authorized shares of Common Stock of the Company. The
Company agrees that it will use all reasonable efforts to cause a Stockholders Meeting to
be convened by December 31, 2004 or as soon thereafter as possible, at which the
Company’s stockholders will be asked to (i) approve an increase in the total number
of authorized shares of Common Stock of the Company to an amount which is mutually
acceptable to the Investor and the Company and (ii) to increase the number of shares of
Common Stock underlying the Company’s Stock Option Plan to equal 10% of the total
number of authorized shares of Common Stock of the Company, including a vesting schedule
of one third of the shares upon award, and one third in each of the two consecutive
following years, after the increase referred to in Clause (i) above. The Company further
agrees that it will not issue or otherwise utilize any Common Stock not currently reserved
as of the date of this Agreement for any additional purposes until such time as the
shareholders have approved the increase in the number of authorized shares in an amount
sufficient to cover the Shares underlying the Preferred Stock and Warrants issuable to the
Investor 

3.4     Sale or Merger of
Company. Paragraph 6.16 of the Preferred Stock Purchase Agreement is hereby
modified to read as follows: 

	 	
In
the event of a sale or merger of substantially all of the Company or an underwritten
minimum public offering of $5.0 Million of the Common Stock of the Company, then the 4.99%
restriction in the Preferred Stock and in the Warrants will immediately be terminated and
the Investors will have the right to convert the Preferred Stock and exercise the Warrants
concurrent with the sale, subject to the conversion by the Investor of the Preferred Stock
and the payment by the Investor to the Company of the aggregate exercise price of the
Warrant; provided, however that, in such event the Investor hereby agrees that no person
or entity (including but not limited to the Investor and its affiliates) shall have any
right to vote the number of shares of Common Stock then held by or at the direction of or
for the benefit of the Investor and/or its affiliates which would result in the Investor
and/or its affiliates having the right to vote more than twenty-two percent (22%) of the
total votes able to be voted at any time by all the then outstanding shares of voting
stock of the Company. 

PREFERRED STOCK
PURCHASE AGREEMENT BETWEEN
WIDEPOINT CORPORATION AND BARRON PARTNERS LP  
PAGE 4 OF 6  

3.5     Use of
Proceeds. The Company will use the proceeds from the sale of the Additional
Preferred Stock and the Additional Warrants (excluding amounts paid by the Company for
legal and administrative fees in connection with the sale of such securities) for working
capital and acquisitions. 

3.6     Restrictive Legend.
The Investor acknowledges and agrees that the Additional Preferred Stock, the
Additional Warrants and the shares of Common Stock underlying the Additional Preferred
Stock and Additional Warrants shall contain the same restrictive legend as contained in
the Agreements. 

3.7     Entire
Agreement. This Amendment, together with the Agreements, constitutes the
entire agreement of the parties and this Amendment supersedes all prior agreements
(including the Agreements) and undertakings, both written and oral, between the parties,
or any of them, with respect to the subject matter hereof. All provisions of the
Agreements which are not amended by the provisions of this Amendment shall remain
unchanged and continue in full force and effect. 

[SIGNATURES ON
FOLLOWING PAGE] 

PREFERRED STOCK
PURCHASE AGREEMENT BETWEEN
WIDEPOINT CORPORATION AND BARRON PARTNERS LP  
PAGE 5 OF 6  

        IN
WITNESS WHEREOF, the Investors and the Company have as of the date first written above
executed this Agreement. 

WIDEPOINT: 

WIDEPOINT CORPORATION 

/s/ Steve Komar
By: Steve
Komar 
Chairman, President and Chief Executive Officer  

INVESTOR: 

BARRON PARTNERS LP 

/s/ Andrew Barron
Worden
Andrew Barron Worden
President, General Partner of Barron Partners LP
730 Fifth
Avenue, 9th Floor
New York NY 10019  

PREFERRED STOCK
PURCHASE AGREEMENT BETWEEN
WIDEPOINT CORPORATION AND BARRON PARTNERS LP  
PAGE 6 OF 6

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