Document:

EXHIBIT 10.21

 

THIRD AMENDMENT TO EMPLOYMENT
AGREEMENT

 

This Third Amendment to Employment Agreement (this “Agreement”)
is entered into this 26th day of April, 2010 among Rhino Energy LLC (“Employer”),
a Delaware limited liability company, and Chad Hunt (the “Employee”).  Capitalized terms used herein but not
otherwise defined herein shall have the meaning ascribed to them in the Employment
Agreement (as defined below).

 

WHEREAS, the Assignor and the Employee are parties
to an Employment Agreement dated September 1, 2006, as amended by an
Amendment to Employment Agreement dated October 31, 2006, a Second
Amendment to Employment Agreement dated March 10, 2008 and further by an
Assignment Agreement and Amendment to Employment Agreement dated August 26,
2008 (the “Employment Agreement”);

 

WHEREAS, the Employer and the Employee desire to pay
to Employee a one time cash bonus immediately in lieu of the one time $100,000
bonus payment contemplated by Section 2 of the Employment Agreement
payable upon consummation of a Transaction (the “Transaction Bonus”);

 

NOW, THEREFORE, the parties hereto agree as follows:

 

1.             The
Employer and the Employee hereby agree that Employer shall pay the Employee on
his next regularly scheduled pay date a one time cash bonus in the amount of
$100,000, less all required withholdings and less the remaining outstanding
amount of Employee’s Conditional Bonus. 
This cash bonus shall discharge and satisfy Employer’s obligation to pay
Employee the Transaction Bonus referenced in Paragraph 2 of the Employment
Agreement.  This bonus is fully earned
and Employee is not required to refund any portion of it if Employer does not
consummate a Transaction.

 

2.             This
Assignment Agreement shall be construed and enforced pursuant to the laws of
the Commonwealth of Kentucky, including matters of law relating to choice of
law.  Employee hereby consents to the
jurisdiction of the courts of the Commonwealth of Kentucky, including the
Fayette Circuit Court and hereby waives any objection to venue of any action
brought in said court.  Except as
specifically set forth herein, the Employment Agreement shall remain in full
force and effect and is hereby ratified and confirmed.

 

[The remainder of this page is intentionally left blank.]

 

1

 

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

 

 

	
   

  	
  EMPLOYER:

  
	
   

  	
   

  
	
   

  	
  RHINO ENERGY LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David G. Zatezalo

  
	
   

  	
   

  	
  David
  G. Zatezalo

  
	
   

  	
   

  	
  Chief
  Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EMPLOYEE:

  
	
   

  	
   

  
	
   

  	
  CHAD HUNT

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Chad Hunt

  

 

SIGNATURE PAGE

AGREEMENTExhibit
10.13

 

Execution Version

 

 

 

 

SECOND LIEN CREDIT AGREEMENT

 

Dated as of September 27, 2007

 

among

 

ERICKSON AIR-CRANE INCORPORATED

 

as the Borrower,

 

D.B. ZWIRN SPECIAL OPPORTUNITIES FUND, L.P.,

 

as Administrative Agent,

 

and

 

the Other Lenders Party Hereto

 

 

 

 

 

TABLE OF CONTENTS

 

	
  Section

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  I. DEFINITIONS AND ACCOUNTING
  TERMS

  	
   

  	
  1

  
	
   

  	
   

  	
   

  
	
  1.01

  	
  Defined
  Terms

  	
   

  	
  1

  
	
  1.02

  	
  Other
  Interpretive Provisions

  	
   

  	
  22

  
	
  1.03

  	
  Accounting
  Terms

  	
   

  	
  22

  
	
  1.04

  	
  UCC
  Terms

  	
   

  	
  23

  
	
  1.05

  	
  Rounding

  	
   

  	
  23

  
	
  1.06

  	
  References
  to Agreements and Laws

  	
   

  	
  23

  
	
  1.07

  	
  Conflicts

  	
   

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
  II. THE COMMITMENTS AND CREDIT
  EXTENSIONS

  	
   

  	
  23

  
	
   

  	
   

  	
   

  
	
  2.01

  	
  Loans

  	
   

  	
  23

  
	
  2.02

  	
  Borrowing,
  Conversions and Continuations of Loans

  	
   

  	
  24

  
	
  2.03

  	
  Voluntary
  Prepayment of Loans

  	
   

  	
  25

  
	
  2.04

  	
  Mandatory
  Prepayment of Loans

  	
   

  	
  25

  
	
  2.05

  	
  Repayment
  of Loans

  	
   

  	
  26

  
	
  2.06

  	
  Interest

  	
   

  	
  26

  
	
  2.07

  	
  Arrangement
  and Agency Fees

  	
   

  	
  26

  
	
  2.08

  	
  Computation
  of Interest and Fees

  	
   

  	
  26

  
	
  2.09

  	
  Evidence
  of Debt

  	
   

  	
  27

  
	
  2.10

  	
  Payments
  Generally

  	
   

  	
  27

  
	
  2.11

  	
  Sharing
  of Payments

  	
   

  	
  29

  
	
  2.12

  	
  Security

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  
	
  III. TAXES, YIELD PROTECTION AND
  ILLEGALITY

  	
   

  	
  30

  
	
   

  	
   

  	
   

  
	
  3.01

  	
  Taxes

  	
   

  	
  30

  
	
  3.02

  	
  Illegality

  	
   

  	
  31

  
	
  3.03

  	
  Inability
  to Determine Rates

  	
   

  	
  32

  
	
  3.04

  	
  Increased
  Cost and Reduced Return; Capital Adequacy; Reserves on Eurocurrency Rate
  Loans

  	
   

  	
  32

  
	
  3.05

  	
  Funding
  Losses

  	
   

  	
  33

  
	
  3.06

  	
  Survival

  	
   

  	
  34

  
	
  3.07

  	
  Replacement
  of Lenders

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  
	
  IV. CONDITIONS PRECEDENT TO
  CREDIT EXTENSIONS

  	
   

  	
  35

  
	
   

  	
   

  	
   

  
	
  4.01

  	
  Conditions
  of Borrowing

  	
   

  	
  35

  
	
  4.02

  	
  Conditions
  to All Borrowings, Conversions and Continuations

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
   

  
	
  V. REPRESENTATIONS AND WARRANTIES

  	
   

  	
  38

  

 

i

 

	
  5.01

  	
  Existence,
  Qualification and Power; Compliance with Laws

  	
   

  	
  38

  
	
  5.02

  	
  Authorization;
  No Contravention

  	
   

  	
  39

  
	
  5.03

  	
  Governmental
  Authorization; Other Consents

  	
   

  	
  39

  
	
  5.04

  	
  Binding
  Effect

  	
   

  	
  39

  
	
  5.05

  	
  Financial
  Statements; No Material Adverse Effect

  	
   

  	
  39

  
	
  5.06

  	
  Litigation

  	
   

  	
  40

  
	
  5.07

  	
  No
  Default

  	
   

  	
  40

  
	
  5.08

  	
  Ownership
  of Property; Liens

  	
   

  	
  40

  
	
  5.09

  	
  Environmental
  Compliance

  	
   

  	
  40

  
	
  5.10

  	
  Insurance

  	
   

  	
  40

  
	
  5.11

  	
  Taxes

  	
   

  	
  40

  
	
  5.12

  	
  ERISA
  Compliance

  	
   

  	
  40

  
	
  5.13

  	
  Subsidiaries

  	
   

  	
  41

  
	
  5.14

  	
  Margin
  Regulations; Investment Company Act

  	
   

  	
  41

  
	
  5.15

  	
  Intellectual
  Property; Etc.

  	
   

  	
  41

  
	
  5.16

  	
  Solvency

  	
   

  	
  41

  
	
  5.17

  	
  Disclosure

  	
   

  	
  42

  
	
   

  	
   

  	
   

  	
   

  
	
  VI. AFFIRMATIVE COVENANTS

  	
   

  	
  42

  
	
   

  	
   

  	
   

  
	
  6.01

  	
  Financial
  Statements

  	
   

  	
  42

  
	
  6.02

  	
  Certificates;
  Other Information

  	
   

  	
  42

  
	
  6.03

  	
  Notices

  	
   

  	
  43

  
	
  6.04

  	
  Payment
  of Obligations

  	
   

  	
  44

  
	
  6.05

  	
  Preservation
  of Existence, Etc.

  	
   

  	
  44

  
	
  6.06

  	
  Maintenance
  of Properties

  	
   

  	
  44

  
	
  6.07

  	
  Maintenance
  of Insurance

  	
   

  	
  44

  
	
  6.08

  	
  Compliance
  with Laws

  	
   

  	
  45

  
	
  6.09

  	
  Books
  and Records

  	
   

  	
  45

  
	
  6.10

  	
  Inspection
  Rights

  	
   

  	
  45

  
	
  6.11

  	
  Compliance
  with ERISA

  	
   

  	
  45

  
	
  6.12

  	
  Subsidiaries

  	
   

  	
  45

  
	
  6.13

  	
  Intellectual
  Property

  	
   

  	
  45

  
	
  6.14

  	
  Use
  of Proceeds

  	
   

  	
  46

  
	
  6.15

  	
  Further
  Assurances

  	
   

  	
  46

  
	
  6.16

  	
  Citizenship

  	
   

  	
  46

  
	
   

  	
   

  	
   

  	
   

  
	
  VII. NEGATIVE COVENANTS

  	
   

  	
  46

  
	
   

  	
   

  	
   

  
	
  7.01

  	
  Liens

  	
   

  	
  47

  
	
  7.02

  	
  Investments

  	
   

  	
  48

  
	
  7.03

  	
  Indebtedness

  	
   

  	
  50

  
	
  7.04

  	
  Fundamental
  Changes

  	
   

  	
  52

  
	
  7.05

  	
  Dispositions

  	
   

  	
  52

  
	
  7.06

  	
  Lease
  Obligations

  	
   

  	
  53

  
	
  7.07

  	
  Restricted
  Payments

  	
   

  	
  54

  
	
  7.08

  	
  ERISA

  	
   

  	
  54

  

 

ii

 

	
  7.09

  	
  Change
  in Nature of Business

  	
   

  	
  54

  
	
  7.10

  	
  Transactions
  with Affiliates

  	
   

  	
  55

  
	
  7.11

  	
  Burdensome
  Agreements

  	
   

  	
  55

  
	
  7.12

  	
  Margin
  Regulations

  	
   

  	
  56

  
	
  7.13

  	
  Financial
  Covenants

  	
   

  	
  56

  
	
  7.14

  	
  Maximum
  Capital Expenditures

  	
   

  	
  58

  
	
  7.15

  	
  No
  Domestic Subsidiaries

  	
   

  	
  58

  
	
  7.16

  	
  No
  Second Lien Pledge of Accounts Receivables

  	
   

  	
  58

  
	
   

  	
   

  	
   

  	
   

  
	
  VIII. EVENTS OF DEFAULT AND
  REMEDIES

  	
   

  	
  58

  
	
   

  	
   

  	
   

  
	
  8.01

  	
  Events
  of Default

  	
   

  	
  58

  
	
  8.02

  	
  Remedies
  Upon Event of Default

  	
   

  	
  61

  
	
  8.03

  	
  Application
  of Funds

  	
   

  	
  61

  
	
   

  	
   

  	
   

  	
   

  
	
  IX. ADMINISTRATIVE AGENT

  	
   

  	
  62

  
	
   

  	
   

  	
   

  
	
  9.01

  	
  Appointment
  and Authorization of Administrative Agent

  	
   

  	
  62

  
	
  9.02

  	
  Delegation
  of Duties

  	
   

  	
  62

  
	
  9.03

  	
  Liability
  of Administrative Agent

  	
   

  	
  62

  
	
  9.04

  	
  Reliance
  by Administrative Agent

  	
   

  	
  63

  
	
  9.05

  	
  Notice
  of Default

  	
   

  	
  63

  
	
  9.06

  	
  Credit
  Decision; Disclosure of Information by Administrative Agent

  	
   

  	
  64

  
	
  9.07

  	
  Indemnification
  of Administrative Agent

  	
   

  	
  64

  
	
  9.08

  	
  Administrative
  Agent in its Individual Capacity

  	
   

  	
  65

  
	
  9.09

  	
  Successor
  Administrative Agent

  	
   

  	
  65

  
	
  9.10

  	
  Collateral
  and Guaranty Matters

  	
   

  	
  65

  
	
   

  	
   

  	
   

  	
   

  
	
  X. MISCELLANEOUS

  	
   

  	
  66

  
	
   

  	
   

  	
   

  
	
  10.01

  	
  Amendments,
  Etc.

  	
   

  	
  66

  
	
  10.02

  	
  Notices
  and Other Communications; Facsimile Copies

  	
   

  	
  67

  
	
  10.03

  	
  No
  Waiver; Cumulative Remedies

  	
   

  	
  68

  
	
  10.04

  	
  Attorney
  Costs, Expenses and Taxes

  	
   

  	
  68

  
	
  10.05

  	
  Indemnification
  by the Borrower

  	
   

  	
  68

  
	
  10.06

  	
  Payments
  Set Aside

  	
   

  	
  69

  
	
  10.07

  	
  Successors
  and Assigns; Lender Assignment

  	
   

  	
  69

  
	
  10.08

  	
  Confidentiality

  	
   

  	
  72

  
	
  10.09

  	
  Set-off

  	
   

  	
  73

  
	
  10.10

  	
  Interest
  Rate Limitation

  	
   

  	
  73

  
	
  10.11

  	
  Counterparts

  	
   

  	
  73

  
	
  10.12

  	
  Integration

  	
   

  	
  73

  
	
  10.13

  	
  Survival
  of Representations and Warranties

  	
   

  	
  74

  
	
  10.14

  	
  Severability

  	
   

  	
  74

  
	
  10.15

  	
  USA
  Patriot Act Notice

  	
   

  	
  74

  
	
  10.16

  	
  No
  Foreign Control

  	
   

  	
  74

  
	
  10.17

  	
  Governing
  Law

  	
   

  	
  75

  

 

iii

 

	
  10.18

  	
  Waiver
  of Right to Trial by Jury

  	
   

  	
  75

  
	
  10.19

  	
  Forced
  Place Insurance

  	
   

  	
  75

  
	
  10.20

  	
  Time
  of the Essence

  	
   

  	
  76

  
	
  10.21

  	
  Judgment Currency

  	
   

  	
  76

  

 

SCHEDULES

 

	
  1.01

  	
  Air
  Cranes, Real Estate

  	
   

  	
   

  
	
  2.01

  	
  Commitments
  and Pro Rata Shares

  	
   

  	
   

  
	
  5.06

  	
  Litigation

  	
   

  	
   

  
	
  5.09

  	
  Environmental
  Matters

  	
   

  	
   

  
	
  5.10

  	
  Property
  Insurance

  	
   

  	
   

  
	
  5.13

  	
  Subsidiaries
  and Other Equity Investments

  	
   

  	
   

  
	
  5.15

  	
  Intellectual
  Property

  	
   

  	
   

  
	
  7.01

  	
  Existing
  Liens

  	
   

  	
   

  
	
  7.02

  	
  Existing
  Investments

  	
   

  	
   

  
	
  7.03

  	
  Existing
  Indebtedness

  	
   

  	
   

  
	
  7.06

  	
  Existing
  Leases

  	
   

  	
   

  
	
  7.10

  	
  Transactions
  with Affiliates

  	
   

  	
   

  
	
  7.11

  	
  Existing
  Burdensome Agreements

  	
   

  	
   

  
	
  10.02

  	
  Addresses
  for Notices

  	
   

  	
   

  

 

EXHIBITS

 

	
   

  	
  Form of

  	
   

  	
   

  
	
  A

  	
  Loan
  Notice

  	
   

  	
   

  
	
  B

  	
  Note

  	
   

  	
   

  
	
  C

  	
  Intentionally
  Omitted

  	
   

  	
   

  
	
  D-1

  	
  Second
  Lien Deed of Trust

  	
   

  	
   

  
	
  D-2

  	
  Second
  Lien Aircraft Security Agreement

  	
   

  	
   

  
	
  E

  	
  Intentionally
  Omitted

  	
   

  	
   

  
	
  F

  	
  Intentionally
  Omitted

  	
   

  	
   

  
	
  G

  	
  Compliance
  Certificate

  	
   

  	
   

  
	
  H

  	
  Assignment
  and Assumption

  	
   

  	
   

  
	
  I

  	
  Opinion
  of Counsel to the Borrower

  	
   

  	
   

  
	
  J-1

  	
  First
  Lien/Second Lien Intercreditor Agreement

  	
   

  	
   

  
	
  J-2

  	
  Aircraft
  Intercreditor Agreement

  	
   

  	
   

  

 

iv

 

SECOND LIEN CREDIT AGREEMENT

 

This SECOND LIEN CREDIT AGREEMENT (“Agreement”)
is made and entered into as of September 27, 2007, by and among ERICKSON
AIR-CRANE INCORPORATED, a Delaware corporation (the “Borrower”), the
lenders from time to time party hereto (collectively, the “Lenders” and
each, individually, a “Lender”), and D.B. ZWIRN SPECIAL OPPORTUNITIES
FUND, L.P. (“DBZ”), as administrative agent for the Lenders (in such
capacity, the “Administrative Agent”).

 

RECITALS

 

The Borrower has requested that the Lenders provide
a senior secured second lien credit facility in the amount of $20,000,000, and
the Lenders are willing to do so on the terms and conditions set forth herein;

 

NOW, THEREFORE, in consideration of the mutual
covenants and agreements herein contained, the parties hereto covenant and
agree as follows:

 

I.

DEFINITIONS AND ACCOUNTING TERMS

 

1.01                        Defined
Terms.  As used in this Agreement, the
following terms shall have the meanings set forth below:

 

“Account” means all of the Borrower’s accounts,
as such term is defined in the Uniform Commercial Code of the State of New York
(“UCC”), including each and every right of the Borrower to the payment
of money, whether such right to payment now exists or hereafter arises, whether
such right to payment arises out of a sale, lease or other disposition of goods
or other property, out of a rendering of services, out of a loan, out of the
overpayment of taxes or other liabilities, or otherwise arises under any
contract or agreement, whether such right to payment is created, generated or
earned by the Borrower or by some other person who subsequently transfers such
person’s interest to the Borrower, whether such right to payment is or is not
already earned by performance, and howsoever such right to payment may be
evidenced, together with all other rights and interests (including all Liens)
which the Borrower may at any time have by law or agreement against any account
debtor or other obligor obligated to make any such payment or against any
property of such account debtor or other obligor; all including but not limited
to all present and future accounts, contract rights, loans and obligations
receivable, chattel papers, bonds, notes and other debt instruments, tax
refunds and rights to payment in the nature of general intangibles.

 

“Act” means the Federal Aviation Act of 1958,
as amended.

 

“Adjusted EBITDA” means, for any period, for
the Borrower, Adjusted Net Income plus,  to the extent deducted in
determining Net Income, interest, taxes, depreciation and amortization, plus
the sum of:  (i) any expense or loss
associated with (A) any proposed or completed equity or debt financing on
or prior to the Closing Date and (B) the early retirement, extinguishment
or refinancing of debt, and (C) bonuses paid with respect to the
completion of any of the foregoing, (ii) any fees, expenses or charges
deducted in computing Adjusted Net Income which have been

 

Exhibit
J-2-1

 

determined by management of
the Borrower, which determination is acceptable to the Administrative Agent, to
be non-recurring by virtue of changes in the Borrower’s method of operations
pursuant to its cost reduction or restructuring programs, (iii) non-cash
charges resulting from the application of purchase accounting, (iv) non-cash
expenses resulting from the granting of stock options, restricted stock or
restricted stock unit awards under equity compensation programs solely with
respect to Capital Stock, (v) transaction costs and expenses incurred in
connection with Permitted Acquisitions, (vi) transaction costs incurred in
connection with the transactions consummated during the last 12 months prior to
and including the Closing Date and (vii) any other adjustments which are
mutually agreed upon.

 

“Adjusted Net Income” means, for any period,
for the Borrower and Subsidiaries on a consolidated basis, net income excluding
(i) extraordinary gains and extraordinary losses, (ii) the effect of
all non-cash currency translation adjustments (these “currency translation
adjustments” shall exclude from Adjusted Net Income all income statement
non-cash gains and losses from non-speculative, unbalanced hedge positions), (iii) involuntary
conversion gains and losses, (iv) gains and losses from the disposal of
property, plant and equipment, (v) any accretion on preferred stock, and (vi) Management
Fees to the extent deducted from net income.

 

“Administrative Agent” means DBZ, in its
capacity as administrative agent under any of the Loan Documents, or any
successor administrative agent.

 

“Administrative Agent’s Office” means, with
respect to any currency, the Administrative Agent’s address and, as
appropriate, account as set forth in Schedule  10.02  with respect to such currency,  or
such other address or account with respect to such currency as the
Administrative Agent may from time to time notify to the Borrower and the
Lenders in writing.

 

“Affiliate” means, with respect to any
Person, another Person that directly, or indirectly through one or more
intermediaries, Controls or is Controlled by or is under common Control with
the Person specified.  “Control”
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise.  “Controlling” and “Controlled”
have meanings correlative thereto. 
Without limiting the generality of the foregoing, in determining whether
a Person is Controlled by the Borrower, such Person shall be deemed to be
Controlled by the Borrower if the Borrower possesses, directly or indirectly,
power to vote 50% or more of the securities having ordinary voting power for
the election of directors, managing general partners or the equivalent.

 

“Agent-Related Persons” means the
Administrative Agent (including any successor administrative agent), together
with their respective Affiliates, and the officers, directors, employees,
agents and attorneys-in-fact of such Persons and Affiliates.

 

“Agreement” means this Second Lien Credit
Agreement.

 

“Agreement Currency” has the meaning given in
Section 10.21.

 

“Aircraft Intercreditor Agreement” means the
Aircraft Intercreditor Agreement by and among the First Lien Administrative
Agent, the Term Lender, the Administrative Agent and their

 

2

 

respective assigns, and
acknowledged by the Borrower, with respect to the Permitted Equipment Financing
and substantially in the form of Exhibit J-2 hereto.

 

“Aircranes” means, individually and collectively,
the Borrower’s now owned and hereafter acquired rotary wing aircraft and
heavy-lift crane equipment as listed in Schedule 1.01 hereto.

 

“Applicable Margin” means, on any date, 8.00%
per annum.

 

“Approved Fund” means has the meaning given
in Section 10.7(h).

 

“Arranger” means DBZ, in its capacity as sole
lead arranger and sole book manager.

 

“Assignment and Assumption” means an
Assignment and Assumption substantially in the form of Exhibit H.

 

“Attorney Costs” means and includes all
reasonable and documented fees and disbursements of any law firm or other
external counsel.

 

“Attributable Indebtedness” means, on any
date, (a) in respect of any capital lease of any Person, the capitalized
amount thereof that would appear on a balance sheet of such Person prepared as
of such date in accordance with GAAP, and (b) in respect of any Synthetic
Lease Obligation, the capitalized amount of the remaining lease payments under
the relevant lease that would appear on a balance sheet of such Person prepared
as of such date in accordance with GAAP if such lease were accounted for as a
capital lease.

 

“Audited Financial Statements” means the
audited consolidated balance sheet of the Borrower and its Subsidiaries for the
fiscal year ended December 31, 2006, prepared in accordance with GAAP, and
the related consolidated statements of income or operations, shareholders’
equity and cash flows for such fiscal year of the Borrower and its
Subsidiaries.

 

“Base Rate” means for any day a fluctuating
rate per annum equal to (a) the Applicable Margin plus the higher of (i) the
Federal Funds Rate plus 0.5% and (ii) the “prime rate” of interest
published on such day in the “Money Rates” table in The Wall Street Journal,
or if not published by The Wall Street Journal on such day, then the
prime rate published by any other nationally recognized financial publication
reasonably selected by DBZ from time to time. 
Any change in such rate shall take effect at the opening of business on
the day such change is announced.

 

“Base Rate Loan” means a Loan that bears
interest based on the Base Rate.  All
Base Rate Loans shall be denominated in Dollars.

 

“Borrower” means Erickson Air-Crane
Incorporated.

 

“Borrower Account” has the meaning given in Section 2.09(c).

 

“Borrowing” means a borrowing consisting of
Loans made by each of the Lenders pursuant to Section 2.01.

 

3

 

“Business Day” means (i) any day other
than a Saturday, Sunday or other day on which commercial banks are authorized
to close under the Laws of, or are in fact closed in, the State of New York,
and, (ii) if such day relates to any LIBO Rate Loan, any such day which is
also a day for trading by and between banks in the London interbank market for
Dollar deposits.

 

“Call Premium” means, with respect to any
applicable prepayment under Section 2.03, an amount equal to (a) 3.00%
of the aggregate principal amount of such prepayment if such prepayment is made
after the Closing Date but on or prior to the first anniversary of the Closing
Date, (b) 2.00% of the aggregate principal amount of such prepayment if
such prepayment is made after the first anniversary of the Closing Date but on
or prior to the second anniversary of the Closing Date and (c) 1.00% of
the aggregate principal amount of such prepayment if such prepayment is made
after the second anniversary of the Closing Date but on or prior to the third
anniversary of the Closing Date.  Any
prepayment made after the third anniversary of the Closing Date will not be
subject to the Call Premium.

 

“Capital Expenditures” means, for any period,
all expenditures of the Borrower during such period determined on a
consolidated basis that, in accordance with GAAP, are or should be included in “purchase
of property and equipment, goodwill, rights of way, and other long-term
tangible assets or a similar tangible or intangible property account,” or
similar items reflected in the consolidated statement of cash flows of the
Borrower.

 

“Capital Stock” shall mean (i) in the
case of a corporation, capital stock, (ii) in the case of an association
or business entity, any and all shares, interests, participations, rights or
other equivalents of capital stock, (iii) in the case of a partnership,
partnership interests (whether general or limited), (iv) in the case of a
limited liability company, membership interests and (v) 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, in
each case however designated and whether or not such shares, interests,
participations, rights, or other equivalents have voting rights.

 

“Cash” means money, currency or a credit
balance in any demand or Deposit Account.

 

“Cash Collateral” means Cash pledged to
Administrative Agent to secure Obligations.

 

“Cash Equivalents” means, as at any date of
determination, (a) marketable securities or evidence of debt (i) issued
or directly and unconditionally guaranteed as to interest and principal by the
United States Government or (ii) issued by any agency of the United States
the obligations of which are backed by the full faith and credit of the United
States, in each case maturing within one year after such date; (b) marketable
direct obligations issued by any state of the United States of America or any
political subdivision of any such state or any public instrumentality thereof,
in each case maturing within one year after such date and having, at the time
of the acquisition thereof, a rating of at least A-1 from S&P or at least P-1
from Moody’s; (c) commercial paper maturing no more than one year from the
date of creation thereof and having, at the time of the acquisition thereof, a
rating of at least A-1 from S&P or at least P-1 from Moody’s; (d) certificates
of deposit or bankers’ acceptances maturing within one year after such date and
issued or accepted by any Lender or by any commercial bank organized under the
laws of the United States of America or any state thereof or the District of
Columbia that (i) is at

 

4

 

least “adequately
capitalized” (as defined in the regulations of its primary Federal banking
regulator) and (ii) has Tier 1 capital (as defined in such regulations) of
not less than $100,000,000; (e) shares of any money market mutual fund
that (i) has substantially all of its assets invested continuously in any
of the types of investments referred to in clauses (a) through (d) above,
(ii) has net assets of not less than $500,000,000, and (iii) has the
highest rating obtainable from either S&P or Moody’s; and (f) in the
case of Foreign Subsidiaries, substantially similar foreign equivalents of
those Cash Equivalents described in clauses (a) through (e) above.

 

“Cash Interest Charges” means, for any
period, for the Borrower, the sum of (a) all interest, premium payments,
utilization fees and nonusage fees (but not including any arrangement or agency
fees or any upfront fees paid to any agent or to any lender), charges and
related expenses of the Borrower in connection with borrowed money (including
capitalized interest) or in connection with the deferred purchase price of
assets, in each case to the extent treated as interest in accordance with GAAP,
plus (b) the portion of rent expense of the Borrower with respect
to such period under capital leases that is treated as interest in accordance
with GAAP; in each case to the extent paid by the Borrower in Cash during such
period.

 

“Change of Control” means, with respect to
any Person, an event or series of events by which:

 

(a)                                  any “person” or “group” (as
such terms are used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended, but excluding any employee benefit plan of
such person or its subsidiaries, and any person or entity acting in its
capacity as trustee, agent or other fiduciary or administrator of any such
plan) (excluding the Sponsors and EAC Shareholders), becomes the “beneficial
owner” (as defined in Rules 13d-3 and 13d-5 under the Securities Exchange
Act of 1934), directly or indirectly, of more than 50% of the equity securities
of such Person entitled to vote for members of the board of directors or
equivalent governing body of such Person on a fully-diluted basis; or

 

(b)                                 a majority of the members of
the board of directors or other equivalent governing body of such Person cease
to be composed of individuals who were appointed by the Sponsors.

 

“Closing Date” means the first date all the
conditions precedent in Section 4.01 are satisfied or waived in
accordance with Section 4.01 (or, in the case of Section 4.01(d),
waived by the Person entitled to receive the applicable payment).

 

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

 

“Collateral” means all of the Borrower’s (i) Eligible
Aircranes and Engines installed thereon on the Closing Date, and including,
without limitation, tail rotor systems, main rotor systems, rotor blades,
transmissions and rotable parts, (ii) Other Aircranes, and (iii) Real
Property.

 

“Collateral Documents” means, collectively, (i) the
Second Lien Deed of Trust, the Second Lien Aircraft Security Agreement and all
other security agreements, control agreements, mortgages, deeds of trust,
patent and trademark assignments, lease assignments, guarantees and

 

5

 

other similar agreements
between the Borrower and the Lenders or the Administrative Agent for the
benefit of the Lenders pursuant to which a security interest is granted or
obligations guarantied now or hereafter delivered to the Lenders or the
Administrative Agent pursuant to or in connection with the transactions
contemplated hereby (including such documents as the Administrative Agent shall
deem appropriate pursuant to Section 6.12), and all financing
statements (or comparable documents now or hereafter filed in accordance with
the Uniform Commercial Code or comparable law) and patent, trademark and
copyright filings against the Borrower as debtor in favor of the Lenders or the
Administrative Agent as secured party for the benefit of the Lenders, and (ii) any
amendments, supplements, modifications, renewals, replacements, consolidations,
substitutions and extensions of any of the foregoing.

 

“Commitment” means, as to each Lender, its
obligation to make Loans to the Borrower pursuant to Section 2.01,
in an aggregate principal amount not to exceed the amount set forth opposite
such Lender’s name on Schedule 2.01.

 

“Compliance Certificate” means a certificate
substantially in the form of Exhibit G.

 

“Contractual Obligation” means, as to any
Person, any provision of any security issued by such Person or of any
agreement, instrument or other undertaking to which such Person is a party or
by which it or any of its property is bound.

 

“DBZ” means D.B. Zwirn Special Opportunities
Fund, L.P.

 

“Debt Amortization” means, for any period,
for the Borrower, an amount equal to the sum, without duplication, of all
scheduled amortization with respect to (including any payment or prepayment of
principal of, premium, if any, or redemption, purchase, retirement, sinking
fund or similar payment) any Indebtedness; in each case payable by the Borrower
and its Subsidiaries on a consolidated basis during such period.

 

“Debtor Relief Laws” means the Bankruptcy
Code of the United States of America, and all other liquidation,
conservatorship, bankruptcy, assignment for the benefit of creditors,
moratorium, rearrangement, receivership, insolvency, reorganization, or similar
debtor relief Laws of the United States of America or other applicable state or
foreign jurisdictions from time to time in effect and affecting the rights of
creditors generally.

 

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

 

“Default Rate” means an interest rate equal
to (a) the Base Rate or LIBO Rate (in each case, including any Applicable
Margin), as applicable, plus (b) 2% per annum, to the fullest
extent permitted by applicable Laws.

 

“Deposit Account” means a demand, time,
savings, passbook or like account with a bank, savings and loan association,
credit union or like organization, other than an account evidenced by a
negotiable certificate of deposit.

 

“Disposition” or “Dispose” means the
sale, transfer, license or other disposition (including any sale and leaseback
transaction) of any property by any Person, including any sale,

 

6

 

assignment, transfer or
other disposal, with or without recourse, of any notes or accounts receivable
or any rights and claims associated therewith.

 

“Dollar” and “$” means lawful money of
the United States of America.

 

“Domestic Subsidiary” means any Subsidiary
that is organized and existing under the laws of the United States or any state
or commonwealth thereof or under the laws of the District of Columbia.

 

“EAC Shareholders” means, individually and
collectively, ZM EAC LLC, a Delaware limited liability company, Stonehouse
Erickson Management Co. LLC, a Delaware limited liability company, and
Stonehouse Erickson Investment Co. LLC, a Delaware limited liability company.

 

“Eligible Aircrane” means each of Aircranes
by registration number listed on Schedule 1.01 as “Eligible
Aircrane”.

 

“Eligible Assignee” has the meaning specified
in Section 10.07(h).

 

“Engine”
means (i) each of the 20 engines manufactured by Pratt & Whitney
model JFTD12A-4A(5-64E) and JFTD12A-5A (5-64F), as applicable, having the
manufacturer’s serial numbers specified on Schedule 1.01 attached
hereto, whether or not from time to time installed on an Airframe or the
airframe, (ii) any replacement engine which may from time to time be
substituted for the Engine pursuant to the terms of Second Lien Aircraft
Security Agreement, and (iii) in each case, any and all parts which are
from time to time incorporated or installed in or attached to any Engine and
any and all parts removed therefrom.

 

“Environmental Laws” means all Laws relating
to environmental, health, safety and land use matters applicable to any
property.

 

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

 

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

 

“ERISA Affiliate” means any corporation which
is part of a controlled group that includes the Borrower or trade or business
(whether or not incorporated) under common control with the Borrower within the
meaning of Section 414(b) or (c) of the Code (and solely for
purposes of provisions relating to Section 412 of the Code to the extent
required by such section, Sections 414(m) and (o) of the Code).

 

7

 

“ERISA Event” means (a) a Reportable
Event with respect to a Pension Plan; (b) a withdrawal by the Borrower or
any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA
during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of
ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan
is in reorganization; (d) the filing of a notice of intent to terminate,
the treatment of a Plan amendment as a termination under Sections 4041 or
4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a
Pension Plan or Multiemployer Plan; (e) an event or condition which
constitutes grounds under Section 4042 of ERISA for the termination of, or
the appointment of a trustee to administer, any Pension Plan or Multiemployer
Plan; or (f) the imposition of any liability under Title IV of ERISA,
other than for PBGC premiums due but not delinquent under Section 4007 of
ERISA, upon the Borrower or any ERISA Affiliate.

 

“Event of Default” has the meaning specified
in Section 8.01.

 

“Event of Loss” means, with respect to any
property, any of the following:  (a) any
loss, destruction or damage of such property; (b) any pending or
threatened institution of any proceedings for the condemnation or seizure of
such property or for the exercise of any right of eminent domain; or (c) any
actual condemnation, seizure or taking, by exercise of the power of eminent
domain or otherwise, of such property, or confiscation of such property or the
requisition of the use of such property.

 

“Existing Credit Agreement” means that
certain Credit Agreement dated as of October 4, 2002, between Erickson
Air-Crane Incorporated, KeyBank National Association, as administrative agent,
and the lending institutions listed therein.

 

“FAA” means the Federal Aviation
Administration of the U.S. Department of Transportation or any successor agency
thereto.

 

“Federal Funds Rate” means, for any day, the
rate per annum (rounded upwards to the next 1/100th of 1%) 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 by the Federal Reserve Bank on the Business Day next
succeeding such day; provided that (a) if such day is not a
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on the next
succeeding Business Day, and (b) if no such rate is so published on such
next succeeding Business Day, the Federal Funds Rate for such day shall be the
average rate charged to DBZ on such day on such transactions as determined by
the Administrative Agent.

 

“Fee
Letter” means the letter agreement dated September 27, 2007, among the
Borrower, the Administrative Agent and the Arranger.

 

“Financed Aircraft Loan Documents” means (a) the
Master Aircraft Loan and Security Agreement, (b) that certain Borrower
Pledge Agreement, dated as of the date hereof, by and between the Borrower, as
pledgor, in favor of KeyBank National Association, as collateral agent for the
First Lien Administrative Agent and the Term Lender, (c) that certain
Stock Pledge 

 

8

 

Agreement, dated as of the
date hereof, by and among the EAC Shareholders, as pledgors, in favor of
KeyBank National Association, as collateral agent for the First Lien
Administrative Agent and the Term Lender, (d) the promissory notes and (e) the
other financing agreements between the Borrower and the Term Lender and/or its
assigns covering the Term Financed Aircranes that are specifically designated
as “Loan Documents” as such term is defined in the Master Aircraft Loan and
Security Agreement, in each case, subject to the Revolving Lender/Term Lender Intercreditor
Agreement and the Aircraft Intercreditor Agreement.

 

“First Lien/Second Lien Intercreditor Agreement”
means an intercreditor agreement between the First Lien Administrative Agent
and the Administrative Agent, and acknowledged by the Borrower, substantially
in the form of Exhibit J-1 hereto.

 

“First Lien Administrative Agent” means the
administrative agent under the First Lien Credit Agreement; currently, KeyBank
National Association.

 

“First Lien Collateral” means all real and
personal property and interests in property and proceeds thereof now owned or
hereafter acquired by the Borrower and any of its Subsidiaries, including,
without limitation, accounts receivable, inventory, Aircrane parts, supplies,
contract rights, general intangibles, Capital Stock, equipment, Eligible
Aircranes, Other Aircranes, all other aircraft, intellectual property,
Production Certificates, Type Certificates, Supplemental Type Certificates, and
aircraft in or upon which a Lien now or hereafter exists in favor of the Revolving
Lenders, or the First Lien Administrative Agent on behalf of the Revolving
Lenders, whether under the First Lien Credit Agreement or under any other
documents executed by any such Person and delivered to the First Lien
Administrative Agent or the Revolving Lenders, as the case may be (exclusive of
Term Financed Aircranes and other personal property of the Borrower securing
the Permitted Equipment Financing).

 

“First Lien Credit Agreement” means that
certain Credit Agreement, dated as of the Closing Date, by and among the
Borrower, the First Lien Administrative Agent and the lenders from time to time
party thereto, as such is amended, modified, supplemented, restated or replaced
in connection with a refinancing of the Indebtedness thereunder from time to
time in accordance with the terms thereof and the terms of the First
Lien/Second Lien Intercreditor Agreement.

 

“First Lien Guarantor” means each existing or
future Domestic Subsidiary of the Borrower that is a “Guarantor” under and as
defined in the First Lien Credit Agreement.

 

“First Lien Loan Documents” means the First
Lien Credit Agreement and each other document, instrument or agreement executed
from time to time by the Borrower or any Loan Party (as such term is used in
the First Lien Credit Agreement) that is specifically designated by its terms
as a “Loan Document” as defined in the First Lien Credit Agreement.

 

“Fixed Charges” means, for any period, for
the Borrower and its Subsidiaries on a consolidated basis, the sum of Cash
Interest Charges for such period, scheduled Debt Amortization for such period,
cash taxes applicable to the subject period, Restricted Payments (other than
Restricted Payment permitted under Section 7.07(a)), and Unfunded
Capital Expenditures.

 

9

 

“Fixed Charge Coverage Ratio” means, as of
any date of determination, for the Borrower and its Subsidiaries on a
consolidated basis, the ratio of (a) the sum of (i) Adjusted EBITDA
for the period of the four prior fiscal quarters ending on such date to (b) Fixed
Charges for such period.

 

“Foreign Lender” has the meaning specified in
Section 3.01(e).

 

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

 

“Funded Debt” means, as of any date of
determination, without duplication, for the Borrower and its Subsidiaries on a
consolidated basis, the sum of (a) the outstanding principal amount of all
obligations, whether current or long-term, for borrowed money and letters of
credit (including, with respect to the Borrower or any First Lien Guarantor,
Guaranty Obligations) and all obligations evidenced by bonds, debentures,
notes, loan agreements or other similar instruments, (b) all purchase
money Indebtedness, and (c) Attributable Indebtedness in respect of
capital leases and Synthetic Lease Obligations.

 

“GAAP” means generally accepted accounting
principles in the United States set forth in the opinions and pronouncements of
the Accounting Principles Board and the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board or such other principles as may be approved by a significant
segment of the accounting profession in the United States, that are applicable
to the circumstances as of the date of determination and applicable to
privately held companies.

 

“Governmental Authority” means any nation or
government, any state or other political subdivision thereof, any agency,
authority, instrumentality, regulatory body, court, administrative tribunal,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.

 

“Guaranty Obligation” means, as to any
Person, any (a) any obligation, contingent or otherwise, of such Person
guarantying or having the economic effect of guarantying any Indebtedness or
other obligation payable or performable by another Person (the “primary obligor”)
in any manner, whether directly or indirectly, and including any obligation of
such Person, direct or indirect, (i) to purchase or pay for (or advance or
supply funds for the purchase or payment of) such Indebtedness or other
obligation, (ii) to purchase or lease property, securities or services for
the purpose of assuring the obligee in respect of such Indebtedness or other
obligation of the payment or performance of such Indebtedness or other
obligation, (iii) to maintain working capital, equity capital or any other
financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness or other obligation, or (iv) entered
into for the purpose of assuring in any other manner the obligees in respect of
such Indebtedness or other obligation of the payment or performance thereof or
to protect such obligees against loss in respect thereof (in whole or in part),
or (b) any Lien on any assets of such Person securing any Indebtedness or
other obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person. 
The amount of any Guaranty Obligation shall be deemed to be an amount
equal to the stated or determinable amount of the related primary obligation,
or portion thereof, in respect of which such Guaranty

 

10

 

Obligation is made or, if
not stated or determinable, the maximum reasonably anticipated liability in
respect thereof as determined by the guarantying Person in good faith.

 

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

 

“Indebtedness” means, as to any Person at a
particular time, without duplication, all of the following, whether or not
included as indebtedness or liabilities in accordance with GAAP, to the extent
recourse may be had to the assets or properties of such Person in respect
thereof:

 

(a)           all
obligations of such Person for borrowed money and all obligations of such
Person evidenced by bonds, debentures, notes, loan agreements or other similar
instruments;

 

(b)           all
direct or contingent obligations of such Person arising under letters of credit
(including standby and commercial), bankers’ acceptances, bank guaranties,
surety bonds and similar instruments;

 

(c)           net
obligations under any Swap Contract in an amount equal to (i) if each Swap
Contract has been closed out, the Swap Termination Value thereof, or (ii) if
such Swap Contract has not been closed out, the mark-to-market value thereof
determined on the basis of readily available quotations provided by any
recognized dealer in such Swap Contract;

 

(d)           all
obligations of such Person to pay the deferred purchase price of property or
services (other than trade accounts payable in the ordinary course of
business);

 

(e)           indebtedness
(excluding prepaid interest thereon) secured by a Lien on property owned or
being purchased by such Person (including indebtedness arising under
conditional sales or other title retention agreements), whether or not such
indebtedness shall have been assumed by such Person or is limited in recourse;

 

(f)            all
obligations in respect of capital leases and Synthetic Lease Obligations; and

 

(g)           all
Guaranty Obligations of such Person in respect of any of the foregoing.

 

For all purposes hereof, the Indebtedness of any
Person shall include the Indebtedness of any partnership or joint venture
(other than a joint venture that is itself a corporation or limited liability
company) in which such Person is a general partner or a joint venturer, unless
such Indebtedness is expressly made non-recourse to such Person (subject only
to customary exceptions acceptable to the Required Lenders).  The amount of any capital lease or Synthetic
Lease Obligation as of any date shall be deemed to be the amount of Attributable
Indebtedness in respect thereof as of such date.  Notwithstanding the foregoing, any obligation
of such Person or 

 

11

 

any of its Subsidiaries in
respect of operating leases shall be deemed not to constitute Indebtedness.

 

“Indemnified Liabilities” has the meaning set
forth in Section 10.05.

 

“Indemnitees” has the meaning set forth in Section 10.05.

 

“Information” has the meaning given in Section 10.08.

 

“Intellectual Property” means, as to any
Person, all of the following:

 

(a)           all
trademarks, service marks, designs, trade names, corporate names, company
names, business names, fictitious business names, trade styles, trade dress,
logos, other source or business identifiers owned or used by such Person in its
business or hereafter adopted or acquired, all registrations and recordings
thereof, and all registration and recording applications filed in connection
therewith, including registrations and pending applications in the United
States Patent and Trademark Office, any State of the United States or any
similar offices in any other country or any political subdivision thereof, and
all extensions or renewals thereof;

 

(b)           all
letters patent of the United States or any other country or any political
subdivision thereof, all registrations and recordings thereof, and all
applications for letters patent of the United States or the equivalent thereof
in any other country owned by such Person, including registrations, recordings
and pending applications in the United States Patent and Trademark Office or
the equivalent thereof in any similar offices in any other country, and all
reissues, continuations, divisions, continuations-in part, renewals or
extensions thereof, and the inventions disclosed or claimed therein, including
the right to make, use and/or sell the inventions disclosed or claimed therein;

 

(c)           all
computer programs, computer data bases, other computer software, trade secrets,
trade secret rights, ideas, drawings, designs, schematics, algorithms, shop
manuals, process and procedures manuals, notes, and other writings, techniques,
processes and formulas owned or used by such Person in its business; and

 

(d)           all
copyright rights of such Person in any work subject to the copyright laws of
the United States, any state thereof or any other country or any political
subdivision thereof, whether registered or unregistered and whether published
or unpublished, whether as author, assignee, transferee or otherwise, and all
registrations and applications for registration of any such copyright in the United
States, any state thereof or any other country or any political subdivision
thereof, including registrations, recordings, supplemental registrations and
pending applications for registration in the United States Copyright Office or
in any similar offices in any other country.

 

“Interest Payment Date” means, (a) as to
any Loan other than a Base Rate Loan, the last day of each Interest Period
applicable to such Loan and the Maturity Date; provided, however,
that if any Interest Period for a LIBO Rate Loan exceeds three months, the
respective dates that fall every three months after the beginning of such
Interest Period shall also be Interest Payment 

 

12

 

Dates; and (b) as to
any Base Rate Loan, the last Business Day of each March, June, September and
December and the Maturity Date.

 

“Interest Period” means the period commencing
on the date such LIBO Rate Loan is disbursed or (in the case of any Base Rate
Loan) converted to or continued as a LIBO Rate Loan and ending on the date one,
two, three or six months thereafter, as selected by the Borrower in its Loan
Notice; provided that:

 

(i)            any Interest Period that would otherwise end on a day
that is not a Business Day shall be extended to the next succeeding Business
Day unless, in the case of a LIBO Rate Loan, such Business Day falls in another
calendar month, in which case such Interest Period shall end on the next
preceding Business Day;

 

(ii)           any Interest Period pertaining to a LIBO Rate Loan that
begins on the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the end of
such Interest Period) shall end on the last Business Day of the calendar month
at the end of such Interest Period; and

 

(iii)          no Interest Period shall extend beyond the scheduled
Maturity Date.

 

“Investment” means, as to any Person, any
direct or indirect acquisition or investment by such Person, whether by means
of (a) the purchase or other acquisition of capital stock or other
securities of another Person, (b) a loan, advance or capital contribution
to, guaranty or assumption of debt of, or purchase or other acquisition of any
other debt or equity participation or interest in, another Person, including
any partnership or joint venture interest in such other Person, or (c) the
purchase or other acquisition (in one transaction or a series of transactions)
of assets of another Person that constitute a business unit.  For purposes of covenant compliance, the
amount of any Investment shall be the amount actually invested, less Returned
Investments, without adjustment for subsequent increases or decreases in the
value of such Investment.

 

“IRS” means the United States Internal
Revenue Service or any successor agency thereto.

 

“Judgment Currency” has the meaning given in Section 10.21.

 

“Laws” means, collectively, all
international, foreign, Federal, state and local statutes, treaties, rules,
guidelines, regulations, ordinances, codes and administrative or judicial
precedents or authorities, including the interpretation or administration
thereof by any Governmental Authority charged with the enforcement,
interpretation or administration thereof, and all applicable administrative
orders, directed duties, requests, licenses, authorizations and permits of, and
agreements with, any Governmental Authority, in each case whether or not having
the force of law.

 

“Lender” has the meaning specified in the
introductory paragraph hereto and any Person that becomes a Lender pursuant to Section 10.07(b).

 

13

 

“Lending Office” means, as to any Lender, the
office or offices of such Lender described as such on Schedule 10.02,
or such other office or offices as a Lender may from time to time notify the
Borrower and the Administrative Agent.

 

“Letter of Credit Facility” means the letter
of credit facility for letters of credit not to exceed the Letter of Credit
Facility Commitment (as defined in the First Lien Credit Agreement) described
in the First Lien Credit Agreement.

 

“LIBO Rate” shall mean, with respect to any
LIBO Rate for any applicable Interest Period, an interest rate per annum equal
to the sum of:  (a) the Applicable
Margin and (b) the product of (i) the Euro-dollar Rate in effect for
such applicable Interest Period and (ii) in accordance with Section 3.04(c),
the Euro-dollar Reserves in effect on the first day of such applicable Interest
Period.

 

As used herein the “Euro-dollar Rate” will be
determined by reference to that rate (rounded upward to the next 1/16th of one
percent) appearing on the display designated as “Reuters Screen LIBOR01 Page”
(or on such other page on that service or such other service designated by
the British Banker’s Association for the display of that Association’s Interest
Settlement Rates for U.S. Dollar deposits) as of 11:00 a.m. (London time)
on the day which is two London Banking Days prior to the first date of the
proposed applicable Interest Period.  If
there are no applicable quotes available through Telerate Service, then the
LIBO Rate shall be deemed unavailable as provided in Section 3.03
hereof.

 

As used herein, the term “Euro-dollar Reserves”
means a fraction (expressed as a decimal), the numerator of which is the number
one and the denominator of which is the number one minus the aggregate of the
maximum reserve percentages (including, without limitation, any special,
supplemental, marginal or emergency reserves) expressed as a decimal
established by the Board of Governors of the Federal Reserve System or any
other banking authority to which Agent is subject for Eurocurrency Liability
(as defined in Regulation D of such Board of Governors).  It is agreed that for purposes hereof, each
LIBO Rate Loan shall be deemed to constitute a Eurocurrency Liability and to be
subject to the reserve requirements of Regulation D, without
benefit of credit or proration, exemptions or offsets which might otherwise be
available to any Lender from time to time under such Regulation D.  Euro-dollar Reserves shall be adjusted automatically
on and as of the effective date of any change in any reserve percentage and
shall apply to applicable Interest Periods commencing after the effective date
of such change.

 

“LIBO Rate Loan” means a Loan that bears
interest at the LIBO Rate.  All LIBO Rate
Loans shall be denominated in Dollars.

 

“Lien” means any mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
other), charge, or preference, priority or other security interest or
preferential arrangement of any kind or nature whatsoever (including any
conditional sale or other title retention agreement, and any financing lease
having substantially the same economic effect as any of the foregoing and, for
the avoidance of doubt, not including any operating leases), including the
interest of a purchaser of accounts receivable.

 

14

 

“Loan” has the meaning specified in Section 2.01.

 

“Loan Documents” means this Agreement, each
Note, each Loan Notice, each Compliance Certificate, each Collateral Document,
the First Lien/Second Lien Intercreditor Agreement, the Aircraft Intercreditor
Agreement, and each other document, instrument or agreement executed from time
to time by the Borrower that is specifically designated by its terms as a “Loan
Document” for purposes of this Agreement.

 

“Loan Notice” means a notice of (a) a
Borrowing, (b) a conversion of Loans from one Type to the other or (c) a
continuation of Loans as the same Type, pursuant to Section 2.02(a),
which, if in writing, shall be substantially in the form of Exhibit A.

 

“Management Agreement” means a management
agreement between the Borrower and the Manager entered into on or about the
Closing Date.

 

“Management Fee” means fees for services by
the Manager pursuant to the Management Agreement.

 

“Manager” means Stonehouse Capital Partners.

 

“Master Aircraft Loan and Security Agreement”
means that certain Master Aircraft Loan and Security Agreement, dated as of the
date hereof, by and between the Borrower, as grantor, and the Term Lender.

 

“Material Adverse Effect” means (a) a
material adverse change in, or a material adverse effect upon, the business,
prospects, operations, properties, liabilities (actual or contingent),
financial and other condition and creditworthiness of the Borrower or the
Borrower and its Subsidiaries taken as a whole, (b) a material impairment
of the ability of the Borrower to perform its obligations under any Loan
Document to which it is a party, taken as a whole; or (c) a material adverse
effect upon (i) the enforceability against the Borrower of any Loan
Documents to which it is a party, or (ii) the perfection or priority of
any Lien granted under any of the Collateral Documents; provided that
the Collateral subject to such Lien has a fair market value, individually or in
the aggregate, in excess of $2,000,000.

 

“Material IP” has the meaning given in Section 5.15.

 

“Maturity Date” means April 1, 2013.

 

“Maximum Rate” has the meaning given in Section 10.10.

 

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

 

“Multiemployer Plan” means any employee
benefit plan of the type described in Section 4001(a)(3) of ERISA, to
which the Borrower or any ERISA Affiliate makes or is obligated to make
contributions, or during the preceding five plan years, has made or been
obligated to make contributions.

 

15

 

“Net Proceeds” means, as to any Disposition
by a Person, proceeds in Cash, as and when received by such Person, net
of:  (a) the direct costs relating
to such Disposition excluding amounts payable to such Person or any Affiliate
of such Person, (b) sale, use or other transaction taxes paid or payable
by such Person as a result thereof, (c) income taxes paid or payable by
such Person as a result of gains recognized on such Disposition, and (d) amounts
required to be applied to repay principal, interest and prepayment premiums and
penalties on Indebtedness secured by a Lien on the asset which is the subject
of such Disposition.  “Net Proceeds”
shall also include proceeds paid on account of any Event of Loss, net of (i) all
money actually applied to repair or reconstruct the damaged property or
property affected by the condemnation or taking, (ii) all of the costs and
expenses reasonably incurred in connection with the collection of such
proceeds, award or other payments, and (iii) any amounts retained by or
paid to parties having superior rights to such proceeds, awards or other
payments.

 

“Net Worth” means, as of the date of determination,
all assets appearing on the balance sheet of Borrower and Subsidiaries on a
consolidated basis, on a GAAP basis, less, without duplication of deductions,
the sum of all liabilities, all reserves established by Borrower for
anticipated losses or expenses, (excluding the effect of currency translation
adjustments recorded in the shareholder’s equity section of Borrower’s balance
sheet and net of the after-tax value of the mark-to-market balances recorded in
the asset and liability sections of the Borrower’s balance sheet that reflect
non-speculative, unbalanced currency hedging positions, all in accordance with
GAAP).

 

“New Subsidiary” has the meaning set forth in
Section 6.12(a).

 

“Non-Consenting Lender” has the meaning
assigned to such term in Section 3.07.

 

“Note” means a promissory note made by the
Borrower in favor of a Lender evidencing Loans made by such Lender,
substantially in the form of Exhibit B.

 

“Obligations” means, without duplication, all
advances to, and debts, liabilities, obligations, covenants and duties of, the
Borrower arising under any Loan Document, whether direct or indirect (including
those acquired by assumption), absolute or contingent, due or to become due,
now existing or hereafter arising.

 

“Organization Documents” means, (a) with
respect to any corporation, the certificate or articles of incorporation and
the bylaws (or equivalent or comparable constitutional documents with respect
to any non-U.S. jurisdiction); (b) with respect to any limited liability
company, the articles of formation and operating agreement; and (c) with
respect to any partnership, joint venture, trust or other form of business
entity, the partnership, joint venture or other applicable agreement of
formation and any agreement, instrument, filing or notice with respect thereto
filed in connection with its formation with the applicable Governmental
Authority in the jurisdiction of its formation, in each case as amended from
time to time.

 

“Other Aircranes” means all “Support
Helicopters” and “Corporate Airplane” identified on Schedule 1.01 and aircraft
engines installed thereon on the Closing Date, and all completed model S-64E
Aircranes and model S-64F Aircranes, whether now owned, hereafter acquired or
manufactured by the Borrower; provided, however, Other Aircranes
shall not include all aircraft, 

 

16

 

airframes and aircraft
engines constituting Eligible Aircranes or Term Financed Aircranes, but only so
long as such Term Financed Aircranes are subject to the Financed Aircraft Loan
Documents.

 

“Outstanding Amount” means, with respect to
Loans on any date, the aggregate outstanding principal amount thereof after
giving effect to any prepayments or repayments of Loans occurring on such date.

 

“Participant” has the meaning specified in Section 10.07(d).

 

“PBGC” means the Pension Benefit Guaranty
Corporation.

 

“Pension Plan” means any “employee pension
benefit plan” (as such term is defined in Section 3(2) of ERISA),
other than a Multiemployer Plan, that is subject to Title IV of ERISA and
is sponsored or maintained by the Borrower or any ERISA Affiliate or to which
the Borrower or any ERISA Affiliate contributes or has an obligation to
contribute, or in the case of a multiple employer or other plan described in Section 4064(a) of
ERISA, has made contributions at any time during the immediately preceding five
plan years.

 

“Permitted Acquisition” means any
acquisition, whether by purchase, merger or otherwise, of all or substantially
all of the assets of, or more than 50%  of the voting
Capital Stock of, or a business line or a division of, any Person; provided
that:

 

(i)            all Persons, assets, business lines or divisions acquired
shall be in the type of business permitted to be engaged in by the Borrower and
its Subsidiaries pursuant to Section 7.09 or such other lines of business
as may be consented to by Required Lenders;

 

(ii)           no Default or Event of Default shall then exist or would
exist after giving effect to such acquisition;

 

(iii)          as of the closing of any acquisition, such acquisition
shall have been approved by the board of directors or equivalent governing body
of the Person to be acquired or from which such assets, business line or
division is to be acquired;

 

(iv)          not less than 15 Business Days prior to the consummation of
any acquisition for cash consideration (including assumed liabilities, earnout
payments and any other deferred payment) in excess of $2,500,000, the Borrower
shall have delivered to the Administrative Agent a written description of the
Person, assets, business line or division to be acquired and its operations
together with a copy of the related purchase agreement, which related purchase
agreement shall be in execution form if available and in the most recent draft
form if an execution form has not been finalized; provided, however the
Borrower shall deliver to the Administrative Agent an execution form of related
purchase agreement as soon as such agreement has been finalized for execution
by the parties thereto;

 

17

 

(v)           the Borrower shall demonstrate to the reasonable
satisfaction of the Administrative Agent that, after giving effect to such
acquisition, the Borrower will be in pro forma compliance with all of the terms
and provisions of the financial covenants set forth in Section 7.13;

 

(vi)          if such acquisition is structured as a merger, the Borrower
(or if such merger is with any Subsidiary, then such Subsidiary) shall be the
surviving Person after giving effect to such merger;

 

(vii)         if the total cash consideration (including assumed
liabilities, earnout payments and any other deferred payment) paid for all of
the Persons, assets, business lines or divisions acquired exceeds $5,000,000 in
the aggregate from the Closing Date, the Required Lenders shall have approved
such acquisition; and

 

(viii)        such acquisition is approved by a
majority of such Person’s board of directors or similar governing body.

 

“Permitted Equipment Financing” means the
approximately $65,000,000 in term loan facilities provided by Term Lender and
assigns, pursuant to the Financed Aircraft Loan Documents and subject to the
Aircraft Intercreditor Agreement and the Revolving Lender/Term Lender
Intercreditor Agreement.

 

“Permitted First Lien Financing” means,
together, the Revolving Credit Facility and the Letter of Credit Facility, in
each case, provided by the Revolving Lenders pursuant to the First Lien
Financing Documents, secured by the First Lien Collateral and subject to the
First Lien/Second Lien Intercreditor Agreement, the Aircraft Intercreditor
Agreement and the Revolving Lender/Term Lender Intercreditor Agreement.

 

“Permitted Liens” has the meaning given in Section 7.01.

 

“Person” means any individual, trustee,
corporation, general partnership, limited partnership, limited liability
company, joint stock company, trust, unincorporated organization, bank,
business association, firm, joint venture, Governmental Authority or other
legal entity.

 

“Plan” means any “employee benefit plan” (as
such term is defined in Section 3(3) of ERISA) established by the
Borrower or, with respect to any such plan that is subject to Section 412
of the Code or Title IV of ERISA, any ERISA Affiliate.

 

“Pro Rata Share” means, with respect to each
Lender, the percentage (carried out to the ninth decimal place) of the
Commitments set forth opposite the name of such Lender on Schedule 2.01,
as such share may be adjusted as contemplated herein.

 

“Real Property” means Borrower’s real
property located in Jackson County, Oregon, all as more particularly described
in Schedule 1.01 hereto.

 

“Register” has the meaning set forth in Section 10.07(c).

 

18

 

“Reportable Event” means any of the events
set forth in Section 4043(c) of ERISA, other than events for which the
30 day notice period has been waived.

 

“Required Lenders” means, as of any date of
determination, Lenders whose Voting Percentages aggregate more than 75%.

 

“Responsible Officer” means the chief
executive officer, chief legal officer, chief financial officer, treasurer or
assistant treasurer of the Borrower or any other officer designated by the
Borrower to the Administrative Agent in writing.  Any document delivered hereunder that is
signed by a Responsible Officer of the Borrower shall be conclusively presumed
to have been authorized by all necessary corporate, partnership and/or other
action on the part of the Borrower and such Responsible Officer shall be
conclusively presumed to have acted on behalf of the Borrower.

 

“Restricted Payment” means (a) any
dividend or other distribution (whether in cash, securities or other property)
with respect to any capital stock or other equity interest of the Borrower or
any Subsidiary, or any payment (whether in cash, securities or other property),
including any sinking fund or similar deposit on account of the purchase,
redemption, retirement, acquisition, cancellation or termination of any such
capital stock or other equity interest or of any option, warrant or other right
to acquire any such capital stock or other equity interest; (b) any
principal payment made in respect of any Subordinated Debt; and (c) Management
Fees; provided that no dividend or other payment or distribution by any
Subsidiary to the Borrower (directly or indirectly) for the purpose of satisfying
any obligation for the payment of taxes shall constituted a Restricted Payment
for purposes of this Agreement.

 

“Retained Aircraft” means Other Aircranes and
all Aircranes of the Borrower except the Term Financed Aircranes.

 

“Returned Investments” means, with respect to
any Investment, the aggregate amount of all payments made in respect of such
Investment that have been paid or returned, without restriction, in cash or
otherwise to the Person making such Investment.

 

“Revolving Credit Facility” means the credit
facility for revolving loans, including the letter of credit subfacility,
described in the First Lien Credit Agreement.

 

“Revolving Lenders” means the lenders from
time to time party to the First Lien Credit Agreement.

 

“Revolving Lender/Term Lender Intercreditor
Agreement” means a collateral sharing and intercreditor agreement among the
First Lien Administrative Agent, for itself and on behalf of the Revolving
Lenders, the Term Lender, KeyBank National Association, as collateral agent,
and their applicable assigns, and acknowledged by the Borrower.

 

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

 

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

 

19

 

“Second Lien Aircraft Security Agreement”
means the Second Lien Aircraft and Flight Equipment Security Agreement by
Borrower in favor of Administrative Agent covering the Retained Aircraft and
Other Aircranes, substantially in the form of Exhibit D-2.

 

“Second Lien Deed of Trust” means the Second
Lien Deed of Trust in favor of First American Title Insurance Company of
Oregon, an Oregon corporation, as Trustee, and Administrative Agent as
Beneficiary, substantially in the form of Exhibit D-1.

 

“Senior Funded Debt” means the sum of the
outstanding Total Funded Debt less outstanding Subordinated Debt.

 

“Solvent” means, as to any Person at a
particular time, if, at such time both (a) (i) the then fair saleable
value of the property of such Person on a going concern basis is (A) greater
than the total amount of liabilities (including contingent liabilities) of such
Person as they mature in the ordinary course and (B) not less than the
amount that will be required to pay the probable liabilities on such Person’s
then existing debts as they become absolute and matured considering all
financing alternatives and potential asset sales reasonably available to such
Person; (ii) such Person’s capital is not unreasonably small in relation
to its business or any contemplated or undertaken transaction; and (iii) such
Person does not intend to incur, or believe (nor should it reasonably believe)
that it will incur, debts beyond its ability to pay such debts as they become
due; and (b) such Person is “solvent” within the meaning given that term
and similar terms under applicable laws relating to fraudulent transfers and
conveyances.  For purposes of this
definition, the amount of any contingent liability at any time shall be
computed as the amount that, in light of all of the facts and circumstances
existing at such time, represents the amount that can reasonably be expected to
become an actual or matured liability in the ordinary course.

 

“Sponsors” means ZM Equity Partners, L.P., a
Delaware limited partnership, D.B. Zwirn & Co., L.P., a Delaware
limited partnership, Stonehouse Management Company, LLC, a Delaware limited
liability company and each of their respective Affiliates.

 

“Subject Lender” has the meaning assigned to
such term in Section 3.07.

 

“Subordinated Debt” means the Indebtedness
hereunder and other Indebtedness of the Borrower which has been subordinated by
written agreement to Indebtedness of Borrower owed to Lenders, in form and
substance reasonably satisfactory to Administrative Agent.

 

“Subsidiary” of a Person means a corporation,
partnership, joint venture, limited liability company or other business entity
of which a majority of the shares of securities or other interests having
ordinary voting power for the election of directors or other governing body
(other than securities or interests having such power only by reason of the
happening of a contingency) are at the time beneficially owned, or the
management of which is otherwise controlled, directly, or indirectly through
one or more intermediaries, or both, by such Person.  Unless otherwise specified, all references
herein to a “Subsidiary” or to “Subsidiaries” shall refer to a
Subsidiary or Subsidiaries of the Borrower.

 

“Swap Contract” means (a) any and all
rate swap transactions, basis swaps, credit derivative transactions, forward
rate transactions, commodity swaps, commodity options, forward commodity
contracts, equity or equity index swaps or options, bond or bond price or

 

20

 

bond index swaps or options
or forward bond or forward bond price or forward bond index transactions,
interest rate options, forward foreign exchange transactions, cap transactions,
floor transactions, collar transactions, currency swap transactions, cross-currency
rate swap transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all
transactions of any kind, and the related confirmations, which are subject to
the terms and conditions of, or governed by, any form of master agreement
published by the International Swaps and Derivatives Association, Inc.,
any International Foreign Exchange Master Agreement, or any other master
agreement (any such master agreement, together with any related schedules, a “Master
Agreement”), including any such obligations or liabilities under any Master
Agreement.

 

“Swap Termination Value” means, in respect of
any one or more Swap Contracts, after taking into account the effect of any
legally enforceable netting agreement relating to such Swap Contracts, (a) for
any date on or after the date such Swap Contracts have been closed out and
termination value(s) determined in accordance therewith, such termination
value(s), and (b) for any date prior to the date referenced in
clause (a) the amount(s) determined as the mark-to-market value(s) for
such Swap Contracts, as determined based upon one or more mid-market or other
readily available quotations provided by any recognized dealer in such Swap
Contracts (which may include any Lender).

 

“Synthetic Lease Obligation” means the
monetary obligation of a Person under (a) a so-called synthetic,
off-balance sheet or tax retention lease, or (b) an agreement for the use
or possession of property creating obligations that do not appear on the
balance sheet of such Person but which, upon the insolvency or bankruptcy of such
Person, would be characterized as the indebtedness of such Person (without
regard to accounting treatment).

 

“Term Financed Aircranes” means the Aircranes
pledged as collateral for the Permitted Equipment Financing as described on Schedule 1.01
hereto.

 

“Term Lender” means The Prudential Insurance
Company of America, its successors and assigns providing term loans for the
Term Financed Aircranes.

 

“Threshold Amount” means $500,000.00.

 

“Total Funded Debt” means, without
duplication, the sum of all outstanding liabilities for borrowed money and
other interest earning liabilities including current and long term liabilities,
guaranties of Indebtedness, and letter of credit obligations, including without
limitation the Revolving Credit Facility, the Financed Aircraft Term Loans, the
Letter of Credit Facility and the Loans.

 

“Transitional Subsidiary” means any
Subsidiary formed after the Closing Date solely for the purpose of implementing
an asset disposition or a structural transaction (including an acquisition)
permitted by this Agreement and which will cease to be a Subsidiary after the
consummation of such asset disposition or transaction (which will, in no event,
be more than 90 days after the date of the formation of such Subsidiary).

 

21

 

“Type” means with respect to a Loan, its
character as a Base Rate Loan or a LIBO Rate Loan.

 

“United States” and “U.S.” each means
the United States of America.

 

“Unfunded Capital Expenditures” means Capital
Expenditures which are not financed by a specific long term loan or Capital
Lease.

 

“Voting Percentage” means, as to any Lender,
such Lender’s Pro Rata Share of the Outstanding Amount of the Loans; provided,
however, that if any Lender has failed to fund any portion of the Loans
required to be funded by it hereunder, such Lender’s Voting Percentage shall be
deemed to be zero, and the respective Pro Rata Shares and Voting Percentages of
the other Lenders shall be recomputed for purposes of this definition and the
definition of “Required Lenders” without regard to such Lender’s
Commitment or the outstanding amount of its Loans.

 

1.02                        Other
Interpretive Provisions.  With
reference to this Agreement and each other Loan Document, unless otherwise
specified herein or in such other Loan Document:

 

(a)                                  The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.

 

(b)                                 (i)                                     The words “herein,” “hereto,” “hereof,” and “hereunder” and
words of similar import when used in any Loan Document shall refer to such Loan
Document as a whole and not to any particular provision thereof.

 

(ii)                                  Article, Section, Exhibit and Schedule references are to
the Loan Document in which such references appear.

 

(iii)                               The term “including” is by way of example and not limitation.

 

(iv)                              The term “documents” includes any and all instruments,
documents, agreements, certificates, notices, reports, financial statements and
other writings, however evidenced, whether in physical or electronic form.

 

(c)                                  In the computation of periods of time from a specified date
to a later specified date, the word “from” means “from and including”; the
words “to” and “until” each mean “to but excluding”; and the word “through”
means “to and including.”

 

(d)                                 Section headings herein and in the other Loan Documents
are included for convenience of reference only and shall not affect the
interpretation of this Agreement or any other Loan Document.

 

1.03                        Accounting Terms.

 

(a)                                  All accounting terms not specifically or completely defined
herein shall be construed in conformity with, and all financial data (including
financial ratios and other financial calculations) required to be submitted
pursuant to this Agreement shall be prepared in conformity with GAAP applied on
a consistent basis as in effect from time to time, applied in a

 

22

 

manner
consistent with that used in preparing the Audited Financial Statements, except
as otherwise specifically prescribed herein.

 

(b)                                 If at any time any change in GAAP would affect the
computation of any financial ratio or requirement set forth in any Loan
Document, and either the Borrower or the Required Lenders shall so request, the
Administrative Agent, the Lenders and the Borrower shall negotiate in good faith
to amend such ratio or requirement to preserve the original intent thereof in
light of such change in GAAP; provided that, until so amended, (i) such
ratio or requirement shall continue to be computed in accordance with GAAP
prior to such change therein and (ii) the Borrower shall provide to the
Administrative Agent and the Lenders financial statements and other documents
required under this Agreement or as reasonably requested hereunder setting
forth a reconciliation between calculations of such ratio or requirement made
before and after giving effect to such change in GAAP.

 

1.04                        UCC
Terms.  Except as otherwise provided
herein, terms used herein that are defined in the Uniform Commercial Code have
the meanings given to them in the Uniform Commercial Code as the same may, from
time to time, be in effect in the State of New York.

 

1.05                        Rounding.  Any financial ratios required to be
maintained by the Borrower pursuant to this Agreement shall be calculated by
dividing the appropriate component by the other component, carrying the result
to one place more than the number of places by which such ratio is expressed
herein and rounding the result up or down to the nearest number (with a
rounding-up if there is no nearest number).

 

1.06                        References
to Agreements and Laws. 
Unless otherwise expressly provided herein, (a) references to
agreements (including the Loan Documents) and other contractual instruments
shall be deemed to include all subsequent amendments, restatements, extensions,
supplements and other modifications thereto, but only to the extent that such
amendments, restatements, extensions, supplements and other modifications are
not expressly prohibited by any Loan Document; and (b) references to any
Law shall include all statutory and regulatory provisions consolidating,
amending, replacing, supplementing or interpreting such Law.

 

1.07                        Conflicts.  In the event of any conflict between this
Agreement and any other Loan Document, this Agreement shall control.

 

II.

THE COMMITMENTS AND CREDIT EXTENSIONS

 

2.01                        Loans.  Subject to the terms and conditions set forth
herein, each Lender severally agrees to make a loan (each such loan, a “Loan”)
to the Borrower in Dollars on the Closing Date, in an aggregate amount equal to
such Lender’s Commitment.  Any amount
borrowed under this Section 2.01 and subsequently repaid and
prepaid may not be reborrowed.  Subject
to Section 2.04, all amounts owed hereunder with respect to the
Loans shall be paid in full no later than the Maturity Date.  Each Lender’s Commitment shall terminate
immediately and without further action on the Closing Date after giving effect
to the funding of such Lender’s Commitment, if any, on such date.  Loans may be Base Rate Loans or LIBO Rate
Loans, as further provided herein.

 

23

 

2.02                        Borrowing, Conversions and Continuations of Loans.

 

(a)                                  Each Borrowing, each conversion of Loans from one Type to the
other, and each continuation of a LIBO Rate Loan shall be made upon the
Borrower’s irrevocable notice to the Administrative Agent, which may be given
by telephone.  Each such notice must be
received by the Administrative Agent not later than 12:00 p.m., New York
time, three Business Days prior to the requested date of any Borrowing of,
conversion to or continuation of LIBO Rate Loans or of any conversion of LIBO
Rate Loans to Base Rate Loans.  Each such
telephonic notice must be confirmed promptly by delivery to the Administrative
Agent of a written Loan Notice, appropriately completed and signed by a
Responsible Officer of the Borrower. 
Each Borrowing of, conversion to or continuation of LIBO Rate Loans
shall be in a principal amount of $1,000,000 or a whole multiple of $100,000 in
excess thereof.  Each Borrowing of or
conversion to Base Rate Loans shall be in a principal amount of $100,000 or a
whole multiple of $50,000 in excess thereof. 
Each Loan Notice (whether telephonic or written) shall specify (i) whether
the Borrower is requesting a Borrowing, a conversion of Loans from one Type to
the other, or a continuation of Loans as the same Type, (ii) the requested
date of the Borrowing, conversion or continuation, as the case may be (which
shall be a Business Day), (iii) the principal amount of Loans to be
borrowed, converted or continued, (iv) the Type of Loans to be borrowed or
to which existing Loans are to be converted and (v) if applicable, the
duration of the Interest Period with respect thereto.  If the Borrower fails to specify a Type of
Loan in a Loan Notice or if the Borrower fails to give a timely notice
requesting a conversion or continuation, then the applicable Loans shall be
made or continued as, or converted to, Base Rate Loans.  Any automatic conversion to Base Rate Loans
and any continuation of LIBO Rate Loans provided for in the preceding sentence
shall be effective as of the last day of the Interest Period then in effect
with respect to the applicable LIBO Rate Loans. 
If the Borrower requests a Borrowing of, conversion to, or continuation
of LIBO Rate Loans in any such Loan Notice, but fails to specify an Interest
Period, it will be deemed to have specified an Interest Period of one month.

 

(b)                                 Following receipt of a Loan Notice, the Administrative Agent
shall promptly notify each Lender of the amount of its Pro Rata Share of the
applicable Loans, and if no timely notice of a conversion or continuation is
provided by the Borrower, the Administrative Agent shall notify each Lender of
the details of any automatic conversion to Base Rate Loans as described in subsection
(a) above.  In the case of a Borrowing,
each Lender shall make the amount of its Loan available to the Administrative
Agent in immediately available funds at the Administrative Agent’s Office not
later than 12:00 p.m., New York time on the Business Day specified in the
applicable Loan Notice.  Upon
satisfaction of the applicable conditions set forth in Sections 4.02
(and, if such Loan Notice relates to the Borrowing on the Closing Date, Section 4.01),
the Administrative Agent shall make all funds so received available to the
Borrower as received by the Administrative Agent either (i) by crediting
the account of the Borrower on the books of DBZ with the amount of such funds
or (ii) wire transfer of such funds, in each case, in accordance with
instructions provided to the Administrative Agent by the Borrower.

 

(c)                                  Except as otherwise provided herein, a LIBO Rate Loan may be
continued or converted only on the last day of the Interest Period for such
LIBO Rate Loan.  During the existence of
a Default or Event of Default, no Loans may be requested as, converted to or
continued as LIBO Rate Loans without the consent of the Required Lenders.

 

24

 

(d)                                 The Administrative Agent shall promptly notify the Borrower
and the Lenders of the interest rate applicable to any LIBO Rate Loan upon
determination of such interest rate.  The
determination of the LIBO Rate by the Administrative Agent shall be conclusive
in the absence of manifest error.  The
Administrative Agent shall notify the Borrower and the Lenders of any change in
DBZ’s prime rate used in determining the Base Rate promptly following the
public announcement of such change.

 

(e)                                  After giving effect to all Borrowings, all conversions of
Loans from one Type to the other, and all continuations of Loans as the same
Type, there shall not be more than ten Interest Periods in effect with respect
to Loans.

 

2.03                        Voluntary
Prepayment of Loans.  To the
extent permitted under the First Lien Credit Agreement, the Borrower may, upon
notice from the Borrower to the Administrative Agent, at any time or from time
to time voluntarily prepay Loans in whole or in part; provided that (i) such
notice must be received by the Administrative Agent not later than 12:00 p.m.,
New York time, (A) three Business Days prior to any date of prepayment of
LIBO Rate Loans, and (B) on the date of prepayment of Base Rate Loans; (ii) any
prepayment of LIBO Rate Loans shall be whole multiples of $1,000,000 or a whole
multiple of $100,000 in excess thereof; (iii) any prepayment of Base Rate Loans
shall be in a principal amount of $100,000 or a whole multiple of $50,000 in
excess thereof; and (iv) each prepayment of Loans shall include the
applicable Call Premium (if any).  Each
such notice shall specify the date and amount of such prepayment and the Type(s) of
Loans to be prepaid.  The Administrative
Agent will promptly notify each Lender of its receipt of each such notice, and
of such Lender’s Pro Rata Share of such prepayment.  If such notice is given by the Borrower, the
Borrower shall make such prepayment and the payment amount specified in such
notice shall be due and payable on the date specified therein.  Any prepayment of a LIBO Rate Loan shall be
accompanied by all accrued interest thereon, together with any additional
amounts required pursuant to Section 3.05.  Each such prepayment shall be applied to the
Loans of the Lenders in accordance with their respective Pro Rata Shares.

 

2.04                        Mandatory Prepayment of Loans.

 

(a)                                  If the Borrower or any Domestic Subsidiary shall at any time
or from time to time make or agree to make a Disposition of any Collateral or
unencumbered assets in excess of the Threshold Amount (other than Dispositions
expressly permitted under Sections 7.05(a) through (j),
and (l)) or shall suffer an Event of Loss in excess of the Threshold
Amount, or shall obtain Net Proceeds of any debt of the Borrower (other than
Indebtedness permitted under Section 7.03), or equity issuance of
the Borrower (other than equity issued in favor of the Sponsors and the EAC
Shareholders), then, to the extent permitted under the First Lien Credit
Agreement, the Borrower shall (i) promptly notify the Administrative Agent
of such proposed Disposition or Event of Loss or debt or equity issuance
(including the amount of the estimated Net Proceeds to be received by the
Borrower or such Domestic Subsidiary in respect thereof) and, (ii) promptly
upon, and in no event later than 10 days after, receipt by the Borrower or the
Domestic Subsidiary of the Net Proceeds of such Disposition or Event of Loss or
debt or equity issuance, the Borrower shall prepay Loans in an aggregate amount
equal to the amount of such Net Proceeds (net of the reasonable costs
associated with such Disposition or Event of Loss or debt or equity issuance); provided
that Net Proceeds may be reinvested in assets useful to the

 

25

 

business of
the Borrower within 180 days (which assets do not need to be of the same type
as the assets sold or otherwise disposed of to generate such Net Proceeds).

 

(b)                                 Any prepayments pursuant to Section 2.04(a) shall
be applied (i) first, to the payment in full of Base Rate Loans
then outstanding, (ii) second, to the payment in full of LIBO Rate
Loans then outstanding in direct order of Interest Period maturities, and (iii) third,
to the Borrower; provided, however, that if the amount of Base
Rate Loans then outstanding is not sufficient to satisfy the entire prepayment
requirement, the Borrower may, at its option, place any amounts which it would
otherwise be required to use to prepay LIBO Rate Loans on a day other than the
last day of the Interest Period therefor in a blocked, interest bearing Deposit
Account at DBZ, subject to a Lien in favor of the Administrative Agent on
behalf of the Lenders until the end of such Interest Period at which time such
Cash Collateral will be applied to prepay such LIBO Rate Loans.  The Borrower shall pay, together with each
prepayment under this Section 2.04, accrued interest on the amount
prepaid and any amounts required pursuant to Section 3.05.

 

2.05                        Repayment
of Loans.  The Borrower
shall repay to the Lenders on the Maturity Date the aggregate principal amount
of Loans outstanding on such date.

 

2.06                        Interest.

 

(a)                                  Subject to the provisions of subsection (b) below,
(i) each LIBO Rate Loan shall bear interest on the outstanding principal
amount thereof for each Interest Period at a rate per annum equal to the LIBO
Rate for such Interest Period, plus the Applicable Margin; and (ii) each
Base Rate Loan shall bear interest on the outstanding principal amount thereof
from the applicable borrowing date at a rate per annum equal to the Base Rate,
plus the Applicable Margin.

 

(b)                                 While any Event of Default exists at the request of the
Required Lenders or after acceleration, the Borrower shall pay interest on the
principal amount of all outstanding Obligations at the Default Rate.  Accrued and unpaid interest on past due
amounts (including interest on past due interest) shall be due and payable within
five Business Days from receipt of written notice from the Administrative
Agent.

 

(c)                                  Interest on each Loan shall be due and payable in arrears on
each Interest Payment Date applicable thereto and at such other times as may be
specified herein.  Interest hereunder
shall be due and payable in accordance with the terms hereof before and after
judgment, and before and after the commencement of any proceeding under any
Debtor Relief Law.

 

2.07                        Arrangement
and Agency Fees.  The
Borrower agrees to pay the Arranger and the Administrative Agent, for their own
respective accounts, the arrangement and agency fees in the amounts and at the
times specified in the Fee Letter.

 

2.08                        Computation
of Interest and Fees.  Interest on
Base Rate Loans shall be calculated on the basis of a year of 365 or 366 days,
as the case may be, and the actual number of days elapsed.  Computation of all other types of interest
and all fees shall be calculated on the basis of a year of 360 days and the
actual number of days elapsed, which results in a higher yield

 

26

 

to the payee thereof than a
method based on a year of 365 or 366 days. 
Interest shall accrue on each Loan for the day on which the Loan is
made, and shall not accrue on a Loan, or any portion thereof, for the day on
which the Loan or such portion is paid, provided that any Loan that is
repaid on the same day on which it is made shall bear interest for one day.

 

2.09                        Evidence of Debt.

 

(a)                                  The Pro Rata Share of the Loans made by each Lender, the
rights to principal and interest on such Loans, and the ownership of an
interest in any Loans shall be evidenced by one or more accounts or records
maintained by such Lender and by the Administrative Agent in the ordinary
course of business.  The accounts or
records maintained by the Administrative Agent and each Lender shall be
conclusive absent manifest error of the amount of the Borrowing made by the
Borrower from each Lender and the interest and payments thereon.  Any failure to so record or any error in
doing so shall not, however, limit or otherwise affect the obligation of the
Borrower hereunder to pay any amount owing with respect to the Loans.  In the event of any conflict between the
accounts and records maintained by any Lender and the accounts and records of
the Administrative Agent in respect of such matters, the accounts and records
of the Administrative Agent shall control in the absence of manifest
error.  Upon the request of any Lender
made through the Administrative Agent, such Lender’s Loans may be evidenced by
a Note in addition to such accounts or records. 
Each Lender may attach schedules to its Note(s) and endorse thereon
the date, Type (if applicable), amount and maturity of the applicable Loans and
payments with respect thereto.

 

(b)                                 On each date when the payment of any principal, interest or
fees are due hereunder or under any Note, the Borrower agrees to maintain on
deposit in an ordinary checking account maintained by the Borrower with the
Administrative Agent (as such account shall be designated by the Borrower in a
written notice to the Administrative Agent from time to time, the “Borrower
Account”) an amount sufficient to pay such principal, interest or fees in
full.  The Borrower hereby authorizes the
Administrative Agent (i) to deduct automatically all principal, interest
or fees when due hereunder, or under the Notes from the Borrower Account, and (ii) if
and to the extent any payment under this Agreement or any other Loan Document
is not made when due, to deduct automatically any such amount from any or all
of the accounts of the Borrower maintained with Administrative Agent.  The Administrative Agent agrees to provide
timely notice to the Borrower of any automatic deduction made pursuant to this subsection (b).

 

2.10                        Payments Generally.

 

(a)                                  All payments to be made by the Borrower shall be made without
condition or deduction for any counterclaim, defense, recoupment or
setoff.  Except as otherwise expressly
provided herein, all payments by the Borrower hereunder shall be made to the
Administrative Agent, for the account of the respective Lenders to which such
payment is owed, at the applicable Administrative Agent’s Office in immediately
available funds not later than 12:00 p.m., New York time, on the date
specified herein.  The Administrative
Agent will promptly distribute to each Lender its Pro Rata Share (or other
applicable share as provided herein) of such payment by wire transfer to such
Lender’s Lending Office.  All payments
received by the Administrative Agent (i) after 12:00 p.m., New York
time shall be deemed

 

27

 

received on
the next succeeding Business Day and any applicable interest or fee shall
continue to accrue.

 

(b)                                 Subject to the definition of “Interest Period,” if any
payment to be made by the Borrower shall come due on a day other than a
Business Day, payment shall be made on the next following Business Day.

 

(c)                                  If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal,
interest and fees then due hereunder, such funds shall be applied in the
following order:  (i) first,
toward costs and expenses (including Attorney Costs and amounts payable under Article III)
incurred by the Administrative Agent and each Lender, (ii) second,
toward repayment of interest and fees then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of interest and fees
then due to such parties, and (iii) third, toward repayment of
principal then due hereunder, ratably among the parties entitled thereto in
accordance with the amounts of principal then due to such parties.

 

(d)                                 Unless the Borrower or any Lender has notified the
Administrative Agent prior to the date any payment is required to be made by it
to the Administrative Agent hereunder, that the Borrower or such Lender, as the
case may be, will not make such payment, the Administrative Agent may assume
that the Borrower or such Lender, as the case may be, has timely made such
payment and may (but shall not be so required to), in reliance thereon, make
available a corresponding amount to the Person entitled thereto.  If and to the extent that such payment was
not in fact made to the Administrative Agent in immediately available funds,
then:

 

(i)                                     if the Borrower failed to make such payment, each Lender
shall forthwith on demand repay to the Administrative Agent the portion of such
assumed payment that was made available to such Lender in immediately available
funds, together with interest thereon in respect of each day from and including
the date such amount was made available by the Administrative Agent to such
Lender to the date such amount is repaid to the Administrative Agent in
immediately available funds, at the Federal Funds Rate from time to time in effect;
and

 

(ii)                                  if any Lender failed to make such payment, such Lender shall
forthwith on demand pay to the Administrative Agent the amount thereof in
immediately available funds, together with interest thereon for the period from
the date such amount was made available by the Administrative Agent to the
Borrower to the date such amount is recovered by the Administrative Agent at a
rate per annum equal to the Federal Funds Rate from time to time in effect. If
such Lender pays such amount to the Administrative Agent, then such amount
shall constitute such Lender’s Loan included in the applicable Borrowing.  Nothing herein shall be deemed to relieve any
Lender from its obligation to fulfill its Commitment or to prejudice any rights
which the Administrative Agent or the Borrower may have against any Lender as a
result of any default by such Lender hereunder.

 

A notice of the Administrative Agent to any Lender
with respect to any amount owing under this subsection (d) shall
be conclusive, absent manifest error.

 

(e)                                  If any Lender makes available to the Administrative Agent
funds for any Loan to be made by such Lender as provided in the foregoing
provisions of this Article II, and

 

28

 

the
conditions to the Borrowing set forth in Article IV are not
satisfied or waived in accordance with the terms hereof, the Administrative
Agent shall return such funds (in like funds as received from such Lender) to
such Lender, without interest.

 

(f)                                    The obligations of the Lenders hereunder to make Loans are
several and not joint.  The failure of
any Lender to make any Loan required hereunder shall not relieve any other
Lender of its corresponding obligation to do so, and no Lender shall be
responsible for the failure of any other Lender to so make its Loan.

 

(g)                                 Nothing herein shall be deemed to obligate any Lender to
obtain the funds for any Loan in any particular place or manner or to
constitute a representation by any Lender that it has obtained or will obtain
the funds for any Loan in any particular place or manner.

 

2.11                        Sharing
of Payments.  If, other
than as expressly provided elsewhere herein, any Lender shall obtain on account
of the Loans made by it any payment in cash or otherwise (whether voluntary,
involuntary, through the exercise of any right of set-off, or otherwise) in
excess of its ratable share (or other share contemplated hereunder) thereof,
such Lender shall immediately (a) notify the Administrative Agent of such
fact, and (b) purchase from the other Lenders such participations in the
Loans made by them as shall be necessary to cause such purchasing Lender to
share the excess payment in respect of such Loans pro rata with each of them; provided,
however, that, if all or any portion of such excess payment is
thereafter recovered from the purchasing Lender, such purchase shall to that
extent be rescinded and each other Lender shall repay to the purchasing Lender
the purchase price paid therefor, together with an amount equal to such paying
Lender’s ratable share (according to the proportion of (i) the amount of
such paying Lender’s required repayment to (ii) the total amount so
recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered.  The Borrower agrees that any Lender so
purchasing a participation from another Lender may, to the fullest extent
permitted by law, exercise all of its rights of payment (including the right of
set-off), subject to Section 10.09 with respect to such
participation, as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation. 
The Administrative Agent will keep records (which shall be conclusive
and binding in the absence of manifest error) of participations purchased under
this Section 2.11 and will in each case notify the Lenders
following any such purchases or repayments. 
Each Lender that purchases a participation pursuant to this Section 2.11
shall from and after such purchase have the right to give all notices,
requests, demands, directions and other communications under this Agreement
with respect to the portion of the Obligations purchased to the same extent as
though the purchasing Lender were the original owner of the Obligations
purchased.

 

2.12                        Security.  All of the obligations of the Borrower under
this Agreement, the Notes and each of the other Loan Documents to which the
Borrower is a party shall be secured by the Collateral in accordance with the
Collateral Documents.

 

29

 

III.

TAXES, YIELD PROTECTION AND ILLEGALITY

 

3.01                        Taxes.

 

(a)                                  Except as provided in Section 3.01(f) and subsections (d) and
(e) of Section 10.07, any and all payments by the
Borrower to or for the account of the Administrative Agent or any Lender under
any Loan Document shall be made free and clear of and without deduction for any
and all present or future taxes, duties, levies, imposts, deductions,
assessments, fees, withholdings or similar charges, and all liabilities with
respect thereto (“Taxes”), excluding, in the case of the
Administrative Agent and each Lender, (i) Taxes imposed on or measured by
its overall net or gross income, and franchise Taxes imposed on it (in lieu of
net income Taxes) by the jurisdiction (or any political subdivision thereof)
under the Laws of which the Administrative Agent or such Lender, as the case
may be, is organized or maintains a lending office, or (ii) any branch
profits tax imposed by the United States or any similar tax imposed by any
other jurisdiction (all such non-excluded Taxes being hereinafter referred to
as “Indemnified Taxes”).  If the
Borrower shall be required by any Laws to deduct any Indemnified Taxes from or
in respect of any sum payable under any Loan Document to the Administrative
Agent or any Lender, (i) the sum payable shall be increased as necessary
so that after making all required deductions (including deductions applicable
to additional sums payable under this Section 3.01), each of the
Administrative Agent and such Lender receives an amount equal to the sum it
would have received had no such deductions been made, (ii) the Borrower
shall make such deductions, (iii) the Borrower shall pay or shall cause a
Subsidiary to pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable Laws, and (iv) within 30
days after the date of such payment, the Borrower shall furnish to the
Administrative Agent (which shall forward the same to such Lender) the original
or a certified copy of a receipt evidencing payment thereof.

 

(b)                                 Except as provided in Section 3.01(f) and subsections (d) and
(e) of Section 10.07, in addition, the Borrower agrees
to pay any and all present or future stamp, court, documentary or similar taxes
and any other excise or property Taxes or charges or similar levies which arise
from any payment made under any Loan Document or from the execution, delivery,
performance, enforcement or registration of any Loan Document (hereinafter
referred to as “Other Taxes”).

 

(c)                                  Intentionally omitted.

 

(d)                                 Except as provided in Section 3.01(f) and subsections (d) and
(e) of Section 10.07, the Borrower’s agreement to
indemnify the Administrative Agent and each Lender for the full amount of
Indemnified Taxes and Other Taxes (including any Indemnified Taxes or Other
Taxes imposed or asserted by any jurisdiction on amounts payable under this Section 3.01)
paid by the Administrative Agent and such Lender, is without regard to whether
or not such Indemnified Taxes or Other Taxes were correctly or legally imposed
or asserted by the relevant Governmental Authority.  Payment under this subsection (d) shall
be made within 30 days after the date the Lender or the Administrative Agent
makes a demand therefor.

 

(e)                                  Each Lender that is not a “United States person” within the
meaning of Section 7701(a)(30) of the Code (a “Foreign Lender”), in
the case of each Lender that is a party hereto, on the date of execution of
this Agreement or , in the case of each other Lender (including, without
limitation, a Lender that is an assignee or transferee of an interest under
this Agreement), on or prior to the date on which it becomes a Lender (and from
time to time thereafter), if (x) a lapse in time or change in
circumstances renders the previous certification

 

30

 

obsolete or
inaccurate in any material respect or (y) requested in writing by the
Borrower or the Administrative Agent, shall provide the Borrower and the
Administrative Agent with two accurate and complete original signed copies of
IRS Form W-8BEN or W-8ECI, as appropriate, or any successor form
prescribed by the IRS, either evidencing a complete exemption from United
States withholding tax on payments pursuant to this Agreement or any other Loan
Document or certifying that all amounts receivable pursuant to this Agreement
and any other Loan Document are effectively connected with the conduct of a
trade or business in the United States. 
In addition, each Lender that is a “United States person” within the
meaning of Section 7701(a)(30) of the Code, in the case of each Lender
that is a party hereto, on or prior to the date of its execution and delivery
of this Agreement or, in the case of each other Lender (including, without
limitation, a Lender that is an assignee or transferee of an interest under
this Agreement), on or prior to the date on which it becomes a Lender (and from
time to time thereafter) if (x) a lapse in time or change in circumstances
renders the previous certification obsolete or inaccurate in any material
respect or (y) requested in writing by the Borrower or the Administrative
Agent, shall provide the Administrative Agent with two accurate and complete
signed copies of IRS Form W-9 or any successor form prescribed by the IRS,
certifying that such Lender is a “United States person.”  If such Lender fails to deliver such form,
then the Administrative Agent may withhold from any interest payment to such
Lender an amount equivalent to the applicable back-up withholding tax imposed
by the Code, without reduction.

 

(f)                                    For any period with respect to which, for any reason, a
Lender has failed to provide the Administrative Agent with the applicable form
pursuant to Section 3.01(e), unless such failure is the result of a
change in Law occurring after the date upon which such lender becomes a Lender,
such Lender shall not be entitled to indemnification under Section 3.01(a),
3.01(b) or 3.01(d) with respect to any Taxes that would
not have been imposed had such Lender been able to provide, and provided, such
form.

 

(g)                                 If the Borrower is required to pay additional amounts to or
for the account of any Lender pursuant to this Section 3.01, then
such Lender will agree to use reasonable efforts to change the jurisdiction of
its Applicable Lending Office so as to eliminate or reduce such additional
payment which may thereafter accrue if such change, in the sole judgment of
such Lender, is not otherwise materially disadvantageous to such Lender; provided,
that in determining whether changing the jurisdiction of the applicable Lending
Office would be disadvantageous to such Lender, such Lender shall disregard any
economic disadvantage that the Borrower agrees to indemnify and hold such
Lender harmless from.

 

(h)                                 If any Lender receives or realizes any refund or Tax, any
reduction of, or credit against, its Tax liabilities or otherwise recovered any
amount in connection with any deduction or withholding, or payment of
additional amounts, by the Borrower pursuant to Section 3.01, such
Lender shall reimburse the Borrower an amount equal to the net benefit, after
Tax, that was obtained by the Lender as a consequence of such refund,
reduction, credit or recovery.

 

3.02                        Illegality.  If any Lender determines that any Law has
made it unlawful, or that any Governmental Authority has asserted that it is
unlawful, for any Lender or its applicable Lending Office to make, maintain or
fund LIBO Rate Loans, or to determine or charge interest rates based upon the
LIBO Rate, or any Governmental Authority has imposed material

 

31

 

restrictions on the
authority of such Lender to purchase or sell, or to take deposits in the London
interbank market, in each case after the date hereof, then, on notice thereof
by such Lender to the Borrower through the Administrative Agent, any obligation
of such Lender to make or continue LIBO Rate Loans or to convert Base Rate
Loans to LIBO Rate Loans shall be suspended until such Lender notifies the
Administrative Agent and the Borrower that the circumstances giving rise to
such determination no longer exist. 
Promptly upon making any such determination, such Lender shall provide
notice thereof to the Borrower (with a copy to the Administrative Agent), and
upon receipt of such notice, the Borrower shall, within three Business Days of
receipt of written notice from such Lender, prepay or convert all such LIBO
Rate Loans of such Lender to Base Rate Loans, either on the last day of the
Interest Period therefor, if such Lender may lawfully continue to maintain such
LIBO Rate Loans to such day, or immediately, if such Lender may not lawfully
continue to maintain such LIBO Rate Loans. 
Upon any such prepayment or conversion, the Borrower shall also pay
interest on the amount so prepaid or converted. 
Each Lender agrees to designate a different Lending Office if such
designation will avoid the need for such notice and will not, in the good faith
judgment of such Lender, otherwise be materially disadvantageous to such
Lender.

 

3.03                        Inability
to Determine Rates.  If the
Administrative Agent determines in connection with any request for a LIBO Rate
Loan or a conversion to or continuation thereof that (i) deposits are not
being offered to banks in the London interbank market for the applicable amount
and Interest Period of such LIBO Rate Loan, (ii) adequate and reasonable
means do not exist for determining the LIBO Rate for such LIBO Rate Loan, or (iii) the
LIBO Rate for such LIBO Rate Loan does not adequately and fairly reflect the
cost to the Lenders of funding such LIBO Rate Loan, the Administrative Agent
will promptly notify the Borrower and all Lenders.  Thereafter, the obligation of the Lenders to
make or maintain LIBO Rate Loans shall be suspended until the Administrative
Agent notifies Borrower and all Lenders that it has revoked such notice.  Upon receipt of such notice, the Borrower may
revoke any pending request for a Borrowing, conversion or continuation of LIBO
Rate Loans or, failing that, will be deemed to have converted such request into
a request for a Borrowing of Base Rate Loans in the amount specified therein.

 

3.04                        Increased Cost and Reduced Return; Capital Adequacy; Reserves
on Eurocurrency Rate Loans.

 

(a)                                  If any Lender determines that as a result of the introduction
of or any change in or in the interpretation of any Law, or such Lender’s
compliance therewith, in each case after the date hereof, there shall be any
increase in the cost to such Lender of agreeing to make or making, funding or
maintaining Eurocurrency Rate Loans, or a reduction in the amount received or
receivable by such Lender in connection with any of the foregoing (excluding
for purposes of this subsection (a) any such increased costs
or reduction in amount resulting from (i) Taxes or Other Taxes (as to
which Section 3.01 shall govern), (ii) changes in the basis of
taxation of overall net income or overall gross income by the United States or
any foreign jurisdiction or any political subdivision of either thereof under
the Laws of which such Lender is organized or has its Lending Office, or (iii) reserve
requirements contemplated by Section 3.04(c)), and the result of
any of the foregoing shall be to increase the cost to the affected Lender(s) of,
or to reduce the amount of any such received or receivable by such Lender in
respect of, making, continuing, maintaining or financing (or its obligation to
make, continue,

 

32

 

maintain or
finance) any Loan as, or of converting (or of its obligation to convert) any
Base Rate Loan into, a LIBO Rate Loan by an amount deemed by such Person to be
material, then the Borrower shall pay to such Lender such additional amounts as
will compensate such Lender for such increased cost or reduction.

 

(b)                                 If any Lender determines that the introduction of any Law
regarding capital adequacy or any change therein or in the interpretation
thereof, or compliance by such Lender (or its Lending Office) therewith, in
each case, after the date hereof, has the effect of reducing the rate of return
on the capital of such Lender or any corporation controlling such Lender as a consequence
of such Lender’s obligations hereunder (taking into consideration its policies
with respect to capital adequacy to a level below that which the affected
Lender or such controlling Person would have achieved but for the occurrence of
any such circumstance, and such Lender or controlling Person considers such
level to be material, then the Borrower shall pay to such Lender such
additional amounts as will compensate such Lender for such reduction.

 

(c)                                  The Borrower shall pay to each Lender, as long as such Lender
shall be required to maintain reserves with respect to liabilities or assets
consisting of or including Eurocurrency funds or deposits (currently known as “Eurocurrency
liabilities”), additional interest on the unpaid principal amount of each
LIBO Rate Loan equal to the actual costs of such reserves allocated to such
Loan by such Lender (as determined by such Lender in good faith), which shall
be due and payable on each date on which interest is payable on such Loan; provided
that the Borrower shall have received at least 15 days’ prior notice (with a
copy to the Administrative Agent) of such additional interest from such Lender.

 

(d)                                 Amounts required to be paid by the Borrower pursuant to subsections (a),
(b) and (c) above shall be determined by the applicable
Lender, and notified to the Borrower (with a copy to the Administrative Agent)
in the form of a certificate of such Lender stating that the calculations set
forth therein are in accordance with the terms of this Agreement and setting forth
in reasonable detail the basis for such calculations for losses suffered from
and after the date that is 180 days before the day such Lender notifies the
Borrower thereof, such certificate being conclusive and binding for all
purposes absent manifest error.  The
amount set forth in such certificate shall be payable by the Borrower on the
30th day following delivery of such certificate to the Borrower.

 

(e)                                  If, with respect to any Lender entitled to compensation under
this Section 3.04, a condition arises or an event occurs which
could result in the payment of any amount under subsections (a) through
(c) above, such Lender, promptly upon becoming aware of the same,
shall notify the Borrower thereof and shall take such steps as may be
reasonably necessary for it to mitigate the effects of such condition or event;
provided that such Lender shall have no obligation to take any step that
the Lender determines, in its sole discretion, would be disadvantageous to
Lender.

 

3.05                        Funding Losses.

 

(a)                                  The Borrower shall promptly compensate such Lender for and
hold such Lender harmless from any loss, cost or expense incurred by it as a
result of:

 

33

 

(i)                                     any continuation, conversion, payment or prepayment of any
Loan other than a Base Rate Loan on a day other than the last day of the
Interest Period for such Loan (whether voluntary, mandatory, automatic, by
reason of acceleration or otherwise); or

 

(ii)                                  any failure by
the Borrower (for a reason other than the failure of such Lender to make a
Loan) to prepay, borrow, continue or convert any Loan other than a Base Rate
Loan on the date or in the amount notified by the Borrower;

 

including any loss of
anticipated profits and any loss or expense arising from the liquidation or
reemployment of funds obtained by it to maintain such Loan or from fees payable
to terminate the deposits from which such funds were obtained.  The Borrower shall also pay any customary
administrative fees charged by such Lender in connection with the foregoing.

 

For purposes of calculating amounts payable by the
Borrower to the Lenders under this Section 3.05, each Lender shall
be deemed to have funded each LIBO Rate Loan made by it at the LIBO Rate for
such Loan by a matching deposit or other borrowing in the London interbank
market for a comparable amount and for a comparable period, whether or not such
LIBO Rate Loan was in fact so funded.

 

(b)                                 The amount of the loss or expense shall be determined by the
Lender and notified to the Borrower (with a copy to the Administrative Agent)
in the form of a certificate of such Lender stating that the calculations set
forth therein are in accordance with the terms of this Agreement and setting
forth in reasonable detail the basis for such calculations, such certificate
being conclusive and binding for all purposes absent manifest error.  The amount set forth in such certificate
shall be payable by the Borrower on the 30th day following delivery of such
certificate to the Borrower.  In
determining such amount, the Administrative Agent or such Lender may use any
reasonable averaging and attribution methods.

 

3.06                        Survival.  All of the Borrower’s obligations under this Article III
shall survive termination of the Commitments and repayment of all other
Obligations.

 

3.07                        Replacement
of Lenders.  If (i) either
(A) a Lender defaults in its obligations to fund a Loan pursuant to this
Agreement, (B) a Lender (a “Non-Consenting Lender”) refuses to
consent to an amendment, modification or waiver of this Agreement that, pursuant
to Section 10.01, requires the consent of 100% of the Lenders or
100% of the Lenders with Obligations directly affected, or (C) a Lender
imposes charges, costs and expenses unacceptable to the Borrower under Section 3.04
(any such Lender described in subclause (A), (B) or (C), a “Subject
Lender”), (ii) no Default or Event of Default shall have occurred and
be continuing, and (iii) the Borrower shall have obtained a commitment
from another Lender or an Eligible Assignee to purchase at par the Subject
Lender’s Loans and assume the Subject Lender’s Commitments and all other
obligations of the Subject Lender hereunder, then the Borrower may require the
Subject Lender to assign any or all of its Loans and Commitments to such other
Lender, Lenders, Eligible Assignee or Eligible Assignees pursuant to the
provisions of Section 10.07(b); provided that such Lender,
Lenders, Eligible Assignee or Eligible Assignees is acceptable to
Administrative Agent; provided further that, prior to or
concurrently with such replacement, (a) the Subject Lender shall have
received payment in full of all principal, interest, fees and other amounts
owing to such Subject Lender through such date of replacement in

 

34

 

respect of the applicable
portion of the Subject Lender’s Commitments to be assigned and a release from
its obligations (relating to the assigned portion) under the Loan Documents, (b) the
processing fee, if any, required to be paid under Section 10.07(b) shall
have been paid to the Administrative Agent, (c) all of the requirements
for such assignment contained in Section 10.07, including the
consent of the Administrative Agent and the receipt by the Administrative Agent
of an executed Assignment and Assumption and other supporting documents, have
been fulfilled, and (d) if such Subject Lender is a Non-Consenting Lender,
each assignee shall consent, at the time of such assignment, to each matter in
respect of which such Subject Lender was a Non-Consenting Lender and the
Borrower also requires each other Subject Lender that is a Non-Consenting
Lender to assign its Loans and Commitments.

 

IV.

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

 

4.01                        Conditions
of Borrowing.  The
obligation of each Lender to make any Loan on the Closing Date is subject to
satisfaction of the following conditions precedent:

 

(a)                                  Unless waived by all the Lenders (or by the Administrative
Agent with respect to immaterial matters or items specified in clause (v) or
(vi) below, with respect to which the Borrower has given assurances
satisfactory to the Administrative Agent that such items shall be delivered
promptly following the Closing Date), the receipt of the following by the
Administrative Agent, each of which shall be originals or facsimiles (followed
promptly by originals) unless otherwise specified, each properly executed by a
Responsible Officer of the Borrower, each dated the Closing Date (or, in the
case of certificates of governmental officials, a recent date before the
Closing Date) and each in form and substance satisfactory to the Administrative
Agent and its legal counsel:

 

(i)                                     executed counterparts of this Agreement, sufficient in number
for distribution to the Administrative Agent, each Lender and the Borrower;

 

(ii)                                  Notes executed by the Borrower in favor of each Lender
requesting such a Note, each in a principal amount equal to such Lender’s
Commitment;

 

(iii)                               Intentionally omitted;

 

(iv)                              such certificates of resolutions or other action, incumbency
certificates and/or other certificates of Responsible Officers of the Borrower
as the Administrative Agent may reasonably require to establish the identities
of and verify the authority and capacity of each Responsible Officer thereof
authorized to act as a Responsible Officer in connection with this Agreement
and the other Loan Documents;

 

(v)                                 such evidence as the Administrative Agent may reasonably
require to verify that the Borrower is duly organized or formed, validly
existing, in good standing and qualified to engage in business in each
jurisdiction in which it is required to be qualified to engage in business,
except where failure to qualify would not have a Material Adverse Effect,
including certified copies of the Borrower’s Organization Documents,
certificates of good standing and/or qualification to engage in business and
tax clearance certificates;

 

35

 

(vi)                              a certificate signed by a Responsible Officer of the Borrower
certifying (A) that the conditions specified in Sections 4.02(a) and
(b) have been satisfied, and (B) that there has been no event
or circumstance since the date of the Audited Financial Statements which has or
could be reasonably expected to have a Material Adverse Effect;

 

(vii)                           an opinion of counsel to the Borrower substantially in the form
of Exhibit I;

 

(viii)                        evidence that the Existing Credit Agreement has been or
concurrently with the Closing Date is being terminated and all Liens securing
obligations under the Existing Credit Agreement have been or concurrently with
the Closing Date are being released;

 

(ix)                                a copy of the First Lien/Second Lien Intercreditor Agreement
executed by the First Lien Administrative Agent and the Administrative Agent
and acknowledged by the Borrower;

 

(x)                                   a copy of the Aircraft Intercreditor Agreement executed by
the First Lien Administrative Agent, the Term Lender and the Administrative
Agent and acknowledged by the Borrower;

 

(xi)                                evidence that the Lenders have a second priority perfected
security interest in the Collateral (subject only to Liens expressly permitted
to be prior pursuant to Section 7.01);

 

(xii)                             receipt by the Administrative Agent of evidence that the
Sponsors have filed any required notices of change of ownership of the Borrower
with, and have received no objection thereto from, the U.S. Department of
Transportation;

 

(xiii)                          the Borrower’s Adjusted EBITDA for the trailing 12 months
prior to the Closing Date, is not be less than $25,000,000;

 

(xiv)                         evidence satisfactory to the Administrative Agent that the
Borrower’s undrawn availability under the First Lien Credit Agreement
immediately after the Closing Date is not less than $5,000,000; and

 

(xv)                            evidence satisfactory to the Administrative Agent that EAC
Acquisition Corp. has contributed to the Borrower a minimum capital investment
in the form of (a) common equity totaling $500 and (b) preferred
equity totaling $34,999,500;

 

(b)                                 Unless waived by all Lenders, the receipt of the Collateral
Documents by the Administrative Agent, each of which shall be originals or
facsimiles (followed promptly by originals) unless otherwise specified, each
properly executed by a Responsible Officer of the Borrower, each dated the
Closing Date and each in form and substance satisfactory to the Administrative
Agent and their respective legal counsel, together with:

 

(i)                                     acknowledgment copies of all Uniform Commercial Code
financing statements filed, registered or recorded or, in the discretion of
Administrative Agent, to

 

36

 

be filed,
registered or recorded to perfect the security interests of the Administrative
Agent for the benefit of the Lenders, or other evidence satisfactory to the
Administrative Agent that there has been filed, registered or recorded all
financing statements and other filings, registrations and recordings necessary
and advisable to perfect the Liens of the Administrative Agent for the benefit
of the Lenders in accordance with applicable law;

 

(ii)                                  Lien and judgment searches and such termination statements or
other documents as may be necessary to confirm that the Collateral is subject
to no other Liens in favor of any Persons (except as permitted pursuant to Section 7.01);

 

(iii)                               all certificates and instruments representing the Collateral,
stock transfer powers executed in blank with signatures;

 

(iv)                              evidence that the Second Lien Aircraft Security Agreement has
been filed or will contemporaneously with the Closing be filed with the FAA or
other applicable filing office (foreign or domestic), and the Administrative
Agent shall have received an opinion of special FAA counsel and special counsel
in any other jurisdiction in which Collateral is located, in form and substance
reasonably satisfactory to the Lenders, concluding that the Aircraft Security
and Flight Equipment Agreement is properly of record with the FAA, or such
other applicable filing office, and the Lender’s Lien against the Aircranes,
Other Aircranes and equipment described therein is properly perfected and,
except as provided herein, subject to no prior or senior Liens of record with
the FAA, or such other applicable filing office;

 

(v)                                 Intentionally omitted;

 

(vi)                              evidence that the Second Lien Deed of Trust has been filed
with the appropriate recording office, and the Administrative Agent shall have
received a policy of title insurance in form and substance satisfactory to the
Lenders covering the Second Lien Deed of Trust and the Real Property;

 

(vii)                           evidence that all other actions necessary to perfect and
protect the second priority security interest created by the Collateral
Documents have been taken; and

 

(viii)                        funds sufficient to pay any filing or recording tax or
registration or other fees including, but not limited to, any and all Uniform
Commercial Code financing statements;

 

(c)                                  Standard lenders’ payable endorsements with respect to the
insurance policies or other instruments or documents evidencing insurance
coverage on the properties of the Borrower in accordance with Section 6.07;

 

(d)                                 Any fees required to be paid in accordance with the Fee
Letter on or before the Closing Date shall have been paid;

 

(e)                                  Unless waived by the Administrative Agent, the Borrower shall
have paid all Attorney Costs of the Administrative Agent to the extent invoiced
prior to or on the Closing Date, plus such additional amounts of Attorney Costs
as shall constitute its reasonable estimate of Attorney Costs incurred or to be
incurred by it through the closing proceedings (provided that 

 

37

 

following
the Closing Date there shall be a final settling of accounts between the
Borrower and the Administrative Agent with respect to such estimated Attorney
Costs); and

 

(f)                                    The Closing Date shall have occurred on or prior to October 31,
2007.

 

4.02                        Conditions
to All Borrowings, Conversions and Continuations.  The obligation of each Lender to make any
Loan or honor any Loan Notice is subject to the following conditions precedent:

 

(a)                                  The representations and warranties of the Borrower contained
in Article V or any other Loan Document, or which are contained in
any document furnished at any time under or in connection herewith or
therewith, shall (i) with respect to representations and warranties that
contain a materiality qualification, be true and correct, (ii) with
respect to representations and warranties that do not contain a materiality
qualification, be true and correct in all material respects, on and as of the
date of such Borrowing, conversion or continuation, except to the extent that
such representations and warranties specifically refer to an earlier date, in
which case they shall be true and correct as of such earlier date, and except
that for purposes of this Section 4.02, the representations and
warranties contained in subsections (a) and (b) of
Section 5.05 shall be deemed to refer to the most recent statements
furnished pursuant to clauses (a) and (b),
respectively, of Section 6.01.

 

(b)                                 No Default or Event of Default shall exist, or would result
from such proposed Borrowing, conversion or continuation.

 

(c)                                  The Administrative Agent shall have received a Loan Notice in
accordance with the requirements hereof.

 

Each Loan Notice submitted by the Borrower shall be
deemed to be a representation and warranty that the conditions specified in Sections 4.02(a) and
(b) have been satisfied on and as of the date of the applicable
Loan Notice.

 

V.

REPRESENTATIONS AND WARRANTIES

 

The Borrower represents and warrants to the
Administrative Agent and the Lenders that:

 

5.01                        Existence,
Qualification and Power; Compliance with Laws.  The Borrower (a) is a corporation duly
organized or formed, validly existing and in good standing under the Laws of
the jurisdiction of its incorporation, (b) has all requisite power and
authority and all requisite governmental licenses, authorizations, consents and
approvals to (i) own its assets and carry on its business and (ii) execute,
deliver, and perform its obligations under the Loan Documents to which it is a
party, (c) is duly qualified and is licensed and in good standing under
the Laws of each jurisdiction where its ownership, lease or operation of
properties or the conduct of its business requires such qualification or
license, and (d) is in compliance with all Laws, except in each case
referred to in clause (b)(i), (c) or (d), to the
extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect.

 

38

 

5.02                        Authorization;
No Contravention.  The
execution, delivery and performance by the Borrower of each Loan Document to
which the Borrower is party, has been duly authorized by all necessary
corporate or other organizational action, and does not and will not (a) contravene
the terms of any of the Borrower’s Organization Documents; (b) conflict
with or result in any breach or contravention of, or the creation of any Lien
under, (i) any Contractual Obligation to which the Borrower is a party for
which Borrower may have a liability in excess of $5,000,000, or (ii) any
order, injunction, writ or decree of any Governmental Authority or any arbitral
award to which the Borrower or its property is subject; or (c) violate any
material Law.

 

5.03                        Governmental
Authorization; Other Consents.  No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority or any other Person is necessary or required in
connection with the execution, delivery or performance by, or enforcement
against, the Borrower with respect to this Agreement or any other Loan
Document, except to the extent the same has been obtained or made.

 

5.04                        Binding
Effect.  This Agreement has been, and
each other Loan Document to which the Borrower is a party, when delivered
hereunder, will have been, duly executed and delivered by the Borrower.  This Agreement constitutes, and each other
Loan Document to which the Borrower is a party when so delivered will
constitute, a legal, valid and binding obligation of the Borrower, enforceable
against the Borrower in accordance with its terms, except as enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditors’ rights generally and by
general equitable principles (whether enforcement is sought by proceedings in
equity or at law).

 

5.05                        Financial Statements; No Material Adverse Effect.

 

(a)                                  The Audited Financial Statements (i) were prepared in
accordance with GAAP consistently applied throughout the period covered
thereby, except as otherwise expressly noted therein; (ii) fairly present
the financial condition of the Borrower and its Subsidiaries as of the date
thereof and their results of operations for the period covered thereby in
accordance with GAAP consistently applied throughout the period covered
thereby, except as otherwise expressly noted therein; and (iii) show all
material Indebtedness and other liabilities, direct or contingent, of the
Borrower and its consolidated Subsidiaries as of the date thereof.

 

(b)                                 The unaudited quarterly consolidated financial statements
(and consolidating schedules) of the Borrower and its Subsidiaries dated June 30,
2007 (i) were prepared in accordance with GAAP (excluding footnotes)
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein, and subject to ordinary, good faith year end audit
adjustments; (ii) fairly present the financial condition of the Borrower
and its Subsidiaries as of the date thereof and their results of operations for
the period covered thereby; and (iii) show all material Indebtedness and
other liabilities, direct or contingent, of the Borrower and its consolidated
Subsidiaries as of the date thereof, including liabilities for Taxes, material
commitments and material Indebtedness.

 

(c)                                  Since the date of the Audited Financial Statements, there has
been no event or circumstance that has had or could reasonably be expected to
have a Material Adverse Effect.

 

39

 

5.06                        Litigation.  Except as specifically disclosed in Schedule 5.06,
there are no actions, suits, proceedings, claims or disputes pending or, to the
knowledge of the Borrower, threatened in writing, at law, in equity, in
arbitration or before any Governmental Authority, by or against the Borrower or
any of its Subsidiaries or against any of their properties or revenues, and none
of the items disclosed in Schedule 5.06 could reasonably be
expected to have a Material Adverse Effect.

 

5.07                        No
Default.  Neither the
Borrower nor any Subsidiary is in default under or with respect to any
Contractual Obligation that could be reasonably expected to have a Material
Adverse Effect.  No Default or Event of
Default has occurred and is continuing or would result from the consummation of
the transactions contemplated by this Agreement or any other Loan Document,
including the grant or perfection of the Liens of the Administrative Agent and
the Lenders on the Collateral.

 

5.08                        Ownership
of Property; Liens.  Each of the
Borrower and its Subsidiaries has good record and marketable title in fee
simple to, or valid leasehold interests in, all real property necessary in the
ordinary conduct of its business, except for such defects in title as could
not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.  As of the Closing
Date, the property of the Borrower and its Subsidiaries is subject to no Liens,
other than Liens permitted by Section 7.01.

 

5.09                        Environmental
Compliance.  Except as
specifically disclosed in Schedule 5.09, the Borrower is not in
violation of any Environmental Laws or the subject of any claims alleging
potential liability or responsibility for violation of any Environmental Law
other than as could, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.

 

5.10                        Insurance.  The properties of the Borrower and its
Subsidiaries are insured with financially sound and reputable insurance
companies not Affiliates of the Borrower, in such amounts, with such
deductibles and covering such risks as are shown in the insurance coverage
certificates attached as Schedule 5.10 hereto, and there has been
no change in such coverage.

 

5.11                        Taxes.  The Borrower and its Subsidiaries have filed
all Federal, state and other material tax returns and reports required to be
filed, and have paid all Federal, state and other material taxes, assessments,
fees and other governmental charges levied or imposed upon them or their
properties, income or assets otherwise due and payable, except (a) those
which are being contested in good faith by appropriate proceedings diligently
conducted and for which adequate reserves have been provided in accordance with
GAAP and (b) those which individually or in the aggregate do not exceed
$500,000 at any time.  There is no
proposed tax assessment asserted in writing against the Borrower or any
Subsidiary that would, if made, have a Material Adverse Effect.

 

5.12                        ERISA Compliance.

 

(a)                                  Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other Federal or state Laws,
except to the extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect.  The
prototype plan upon which each Plan that is intended to qualify under Section 401(a) of
the Code is based has

 

40

 

received a
favorable determination letter from the IRS and each Plan has been adopted
without any material substantive changes to such prototype plan and, to the
best knowledge of the Borrower, nothing has occurred which would prevent, or
cause the loss of, such qualification.

 

(b)           There are
no pending or, to the best knowledge of the Borrower, threatened in writing
claims, actions or lawsuits, or action by any Governmental Authority, with
respect to any Plan that could reasonably be expected to have a Material
Adverse Effect.  To the best knowledge of
the Borrower, there has been no “prohibited transaction” (as defined in Section 406
of ERISA) or breach by any Plan fiduciary of any responsibilities, obligations
or duties under Title IV of ERISA with respect to any Plan that has
resulted or could reasonably be expected to result in a Material Adverse
Effect.

 

5.13        Subsidiaries.  The Borrower has no Subsidiaries other than
those specifically disclosed in Part (a) of Schedule 5.13,
and has no equity investments in any other corporation or entity other than
those specifically disclosed in Part (b) of Schedule 5.13.

 

5.14        Margin
Regulations; Investment Company Act.

 

(a)           The
Borrower is not engaged and will not engage, principally or as one of its
important activities, in the business of purchasing or carrying margin stock
(within the meaning of Regulation U issued by the FRB), or extending credit for
the purpose of purchasing or carrying margin stock.

 

(b)           None of
the Borrower or any Subsidiary is required to be registered as an “investment
company” under the Investment Company Act of 1940.

 

5.15        Intellectual Property; Etc.The Borrower and its
Subsidiaries own, or possess the right to use, all Intellectual Property that
is necessary for the operation of their respective businesses (such
Intellectual Property, “Material IP”), without conflict with the rights
of any other Person.  Except for those
items of Intellectual Property disclosed in Schedule 5.15 and where
it could not reasonably be expected to have a Material Adverse Effect, all
registrations with and applications to Governmental Authorities in respect of
such Intellectual Property are valid and in full force and effect and are not
subject to the payment of any taxes or maintenance fees or the taking of any interest
therein, held by any of the Borrower to maintain their validity or
effectiveness.  Except for any default
which could not reasonably be expected to have a Material Adverse Effect, none
of the Borrower or any of its Subsidiaries is in default (or with the giving of
notice or lapse of time or both, would be in default) under any license to use
such Material IP; no claim has been asserted and is pending by any Person
challenging or questioning the use of any such Material IP or the validity or
effectiveness of any such Material IP, nor does the Borrower or any of its
Subsidiaries know of any such claim; and, to the knowledge of the Borrower or
any of its Subsidiaries, the use of such Material IP by the Borrower or any of
its Subsidiaries does not infringe on the rights of any Person.

 

5.16        Solvency.  On the Closing Date, the Borrower is Solvent
(other than as a result of inter-company transactions) on an individual and on
a consolidated basis and shall be Solvent (other than as a result of
inter-company transactions) on an individual and on a consolidated basis during
the term of this Agreement.

 

41

 

5.17        Disclosure.  To the best of Borrower’s knowledge, no
statement, information, report, certification, representation, or warranty when
made by the Borrower or any Responsible Officer of the Borrower in any Loan
Document or when furnished to the Administrative Agent or any Lender by or on
behalf of the Borrower in connection with any Loan Document (including in any
and all disclosure materials furnished by or on behalf of the Borrower)
contains any untrue statement of a material fact or omits any material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading in any
material respect.

 

VI.

AFFIRMATIVE COVENANTS

 

So long as any Lender shall have any Commitment
hereunder or any Loan or other Obligation shall remain unpaid or unsatisfied,
the Borrower shall, and shall (except in the case of the covenants set forth in
Sections 6.01, 6.02, 6.03, 6.11 and 6.16)
cause each Subsidiary to:

 

6.01        Financial Statements.  Deliver to the Administrative Agent and each
Lender, in form and detail reasonably satisfactory to the Administrative Agent:

 

(a)           as soon as
available, but in any event within 120 days after the end of each fiscal year
of the Borrower, annual audited consolidated (and unaudited consolidating
schedules) balance sheet of the Borrower and its Subsidiaries as at the end of
such fiscal year, and the related statements of income or operations,
shareholders’ equity and cash flows for such fiscal year, setting forth in each
case in comparative form the figures for the previous fiscal year, all in
reasonable detail, and accompanied by a report and opinion of an independent
certified public accountant of nationally recognized standing reasonably
acceptable to the Administrative Agent, which report and opinion shall be
prepared in accordance with GAAP and shall not be subject to any qualifications
or exceptions as to the scope of the audit nor to any qualifications and
exceptions not reasonably acceptable to the Administrative Agent; and

 

(b)           as soon as
available, but in any event within 45 days after the end of each fiscal quarter
of each fiscal year of the Borrower, unaudited quarterly consolidated and
consolidating balance sheet of the Borrower and its Subsidiaries as of the end
of such fiscal quarter, and the related Consolidated and Consolidating
statement of income and the statement of cash flows for such fiscal quarter and
for the portion of the Borrower’s fiscal year then ended, setting forth in each
case in comparative form the figures for the corresponding fiscal quarter of
the previous fiscal year and the corresponding portion of the previous fiscal
year, all in reasonable detail and certified by the Director of Finance or the
Chief Financial Officer of the Borrower as fairly presenting the financial
condition, results of operations and cash flows of the Borrower and its
Subsidiaries in accordance with GAAP, subject only to normal year-end audit
adjustments and the absence of footnotes.

 

6.02        Certificates; Other Information.  Deliver to the Administrative Agent and each
Lender, in form and substance reasonably satisfactory to Administrative Agent:

 

42

 

(a)           concurrently
with the delivery of the financial statements referred to in Sections 6.01(a) and
(b), a duly completed Compliance Certificate (in the form of Exhibit G
hereto) signed by the Director of Finance or the Chief Financial Officer of the
Borrower;

 

(b)           promptly,
such additional information regarding the business, financial or corporate
affairs of the Borrower or any Subsidiary, or compliance with the terms of the Loan
Documents, as the Administrative Agent, at the request of any Lender, may from
time to time reasonably request;

 

(c)           within 60
days after the preceding fiscal year end, the Borrower’s annual financial
forecast including pro forma balance sheet, income statement and statement of
cash flows (it being understood that forecasts and projections are subject to
many contingencies and risk factors and actual results may vary materially from
the forecasts and the projections); and

 

(d)           the
certificates of insurance required pursuant to Section 5.2 of the Second
Lien Aircraft Security Agreement.

 

6.03        Notices.  Promptly notify the Administrative Agent:

 

(a)           of the
occurrence of any Default or Event of Default;

 

(b)           of any
dispute, litigation, investigation, or proceeding (or any material development
in the same) or suspension under a Contractual Obligation between the Borrower
or any Subsidiary and any Governmental Authority, in each case, which could
reasonably be expected to have a Material Adverse Effect;

 

(c)           of any
litigation, investigation or proceeding affecting the Borrower in which the
amount involved exceeds $2,000,000, or in which injunctive relief or similar
relief is sought, which relief, if granted, could reasonably be expected to
have a Material Adverse Effect;

 

(d)           of the
occurrence of any ERISA Event;

 

(e)           upon
Borrower’s subsequent knowledge that any material disclosure by Borrower or any
of its Subsidiaries fails to comply with Section 5.17;

 

(f)            of any
material change in accounting policies or financial reporting practices by the
Borrower or any Subsidiary; and

 

(g)           any notice
required to be given pursuant to Section 3.9 of the Second Lien Aircraft
Security Agreement.

 

Each notice pursuant to this Section 6.03
shall be accompanied by a statement of a Responsible Officer of the Borrower
setting forth details of the occurrence referred to therein and stating what
action the Borrower has taken and proposes to take with respect thereto.  Each notice pursuant to subsection (a) above
shall describe with particularity any and all provisions of this Agreement or
other Loan Document that have been breached.

 

43

 

6.04        Payment of Obligations.  Pay and discharge as the same shall become
due and payable (or within any applicable grace period), all its material
obligations and liabilities, including (a) all tax liabilities,
assessments and governmental charges or levies upon it or its properties or
assets, unless the same (i) are being contested in good faith by appropriate
proceedings diligently conducted and adequate reserves in accordance with GAAP
are being maintained by the Borrower or such Subsidiary or (ii) do not
exceed, individually or in the aggregate, $1,000,000 at any time; (b) all
lawful claims which, if unpaid, would by law become a Lien upon its property;
and (c) all material Indebtedness, as and when due and payable, but
subject to any subordination provisions contained in any instrument or
agreement evidencing such Indebtedness.

 

6.05        Preservation of Existence, Etc. (a) Preserve, renew and maintain in full force and
effect its legal existence and good standing under the Laws of the jurisdiction
of its organization, except in a transaction permitted by Section 7.04
or 7.05; (b) take all reasonable action to maintain all rights,
privileges, permits, licenses and franchises necessary or desirable in the
normal conduct of its business, except to the extent that failure to do so
could not reasonably be expected to have a Material Adverse Effect; and (c) preserve
or renew all of its registered Intellectual Property, the non-preservation of
which could reasonably be expected to have a Material Adverse Effect.

 

6.06        Maintenance of Properties.  (a) Maintain, preserve and protect all
of its material properties and equipment necessary in the operation of its
business in good working order and condition, ordinary wear and tear excepted; (b) make
all necessary repairs thereto and renewals and replacements thereof except
where the failure to do so could not reasonably be expected to have a Material
Adverse Effect; (c) use the standard of care typical in the industry in
the operation and maintenance of its facilities; and (d) maintain its aircraft
in accordance with the requirements Second Lien Aircraft Security Agreement and
the FAA.

 

6.07        Maintenance of Insurance.  In addition to insurance requirements set
forth in the Collateral Documents, maintain with financially sound and
reputable insurance companies not Affiliates of the Borrower, insurance with
respect to its properties and business against loss or damage of the kinds
customarily insured against by Persons engaged in the same or similar business,
of such types and in such amounts as are customarily carried under similar
circumstances by such other Persons; including workers’ compensation insurance,
public liability and property and casualty insurance.  All casualty insurance maintained by the
Borrower or any of its Subsidiaries in respect of the Collateral shall name the
Administrative Agent as loss payee, provided that Administrative Agent
shall, so long as no Event of Default has occurred and is continuing, direct
the insurer to pay claims not exceeding $500,000 directly to Borrower, and the
amount of the coverage shall not be reduced by the Borrower without 30 days
prior written notice to the Administrative Agent, and all liability insurance
shall name the Administrative Agent as additional insured for the benefit of
the Lenders, as their interests may appear. 
Upon written request of the Administrative Agent, the Borrower shall
furnish the Administrative Agent information in reasonable detail setting forth
the nature and extent of all insurance maintained by the Borrower and its
Subsidiaries in accordance with this Section 6.07 or any Collateral
Documents.

 

44

 

6.08        Compliance with Laws.  Comply in all material respects with the
requirements of all Laws and all orders, writs, injunctions and decrees
applicable to it or to its business or property, except in such instances in
which (a) such requirement of Law or order, write, injunction or decree is
being contested in good faith by appropriate proceedings diligently conducted;
or (b) the failure to comply therewith could not reasonably be expected to
have a Material Adverse Effect.

 

6.09        Books and Records.  (a) Maintain proper books of record and
account, in which full, true and correct entries in conformity with GAAP
consistently applied shall be made of all financial transactions and matters
involving the assets and business of the Borrower or any of its Subsidiaries,
as the case may be; and (b) maintain such books of record and account in
material conformity with all applicable requirements of any Governmental
Authority having regulatory jurisdiction over the Borrower or such Subsidiary,
as the case may be.

 

6.10        Inspection Rights.  Permit representatives and independent
contractors of the Administrative Agent and each Lender to visit and inspect
any of its properties, to examine its corporate, financial and operating records,
and make copies thereof or abstracts therefrom, and to discuss its affairs,
finances and accounts with its directors, officers, and independent public
accountants all at the expense of the Administrative Agent and such Lender at
reasonable times during normal business hours up to two times per year, upon
reasonable notice to the Borrower; provided, however, that when
an Event of Default exists the Administrative Agent or any Lender (or any of
their respective representatives or independent contractors) may do any of the
foregoing, without limitation, at the reasonable expense of the Borrower at any
time during normal business hours and without advance notice.

 

6.11        Compliance with ERISA.  Do, and cause each of its ERISA Affiliates to
do, each of the following:  (a) maintain
each Plan in compliance in all material respects with the applicable provisions
of ERISA, the Code and other Federal or state Laws; (b) cause each Plan which
is qualified under Section 401(a) of the Code to maintain such
qualification; and (c) make all required contributions to any Plan subject
to Section 412 of the Code, except, with respect to each covenant listed
above, in such instances in which the failure to do so could not reasonably be
expected to have a Material Adverse Effect.

 

6.12        Subsidiaries.  Promptly notify the Administrative Agent
after any Person becomes a Subsidiary (including any Transitional Subsidiary)
of the Borrower or after an inactive subsidiary of the Borrower becomes active
(“New Subsidiary”), and in such notice set forth with respect to such
Person (i) the date on which such Person became a New Subsidiary, and (ii) all
of the data required to be set forth in Schedule 5.13 with respect
to all Subsidiaries; provided that such notice shall be deemed to
supplement Schedule 5.13 for all purposes hereof.

 

6.13        Intellectual Property.  Take all necessary actions, including in any
proceeding before the United States Patent and Trademark Office, the Canadian
Intellectual Property Office — Trademarks or the United States Copyright
Office to maintain each item of Intellectual Property of the Borrower and its
Subsidiaries material to the business of the Borrower and its Subsidiaries
taken as a whole, including payment of maintenance fees, filing of applications
for renewal, affidavits of use, affidavits of incontestability and opposition,
interference and cancellation proceedings.

 

45

 

6.14        Use of Proceeds.  Use the proceeds of the Loans (a) for
transaction costs (including appraisal fees) related to the negotiation,
execution and delivery of the Loan Documents, and (b) for working capital
and other general corporate purposes, in each case, not in contravention of any
Law or of any Loan Document.

 

6.15        Further
Assurances.

 

(a)           Ensure
that all written information, exhibits and reports when furnished to the
Administrative Agent or the Lenders do not and will not contain any untrue
statement of a material fact and do not and will not omit when furnished to
state any material fact or any fact necessary to make the statements contained
therein not misleading in light of the circumstances in which made, and will
promptly disclose to the Administrative Agent and the Lenders and correct any
defect or error that may be discovered therein or in any Loan Document or in
the execution, acknowledgement or recordation thereof.

 

(b)           Promptly
upon request by the Administrative Agent or the Required Lenders, do, execute,
acknowledge, authorize, deliver, record, re-record, file, re-file, register and
re-register, any and all such further acts, deeds, conveyances, security
agreements, mortgages, assignments, estoppel certificates, financing statements
and continuations thereof, termination statements, notices of assignment,
transfers, certificates, assurances and other instruments the Administrative
Agent or such Lenders, as the case may be, may reasonably require from time to
time in order (i) to subject to the Liens created by any of the Collateral
Documents any of the properties, rights or interests covered by any of the
Collateral Documents, (ii) to perfect and maintain the validity,
effectiveness and priority of any of the Collateral Documents and the Liens
intended to be created thereby, and (iii) to assure, convey, grant,
assign, transfer, preserve, protect and confirm to the Administrative Agent and
to the Lenders the rights granted or now or hereafter intended to be granted to
the Lenders under any Loan Document.

 

6.16        Citizenship.  The Borrower is as of the date hereof, and at
all times while this Agreement or any Loan Document is in effect, shall be, or
shall cause the Aircranes operated under United States registration to be
registered in the name of, a “citizen of the United States” within the meaning
of the U.S. Transportation Code, as amended from time to time and recodified at
Section 40102(a)(15) of Title 49 et  seq.  The Borrower shall not permit any act to be
done, or omission to occur, which might injuriously affect the ability of the
Borrower to retain its qualification as a citizen of the United States (provided,
however, that in no event shall such failure be deemed an Event of
Default hereunder if such failure occurs as the result of acts or omissions of
Administrative Agent, Lender or Persons acting under their direction or
control).

 

VII.

NEGATIVE COVENANTS

 

So long as any Lender shall have any Commitment
hereunder or any Loan or other Obligation shall remain unpaid or unsatisfied,
the Borrower shall not, nor shall it permit any Subsidiary to, directly or
indirectly:

 

46

 

7.01        Liens. 
Create, incur, assume or suffer to exist, any Lien upon any of its
property, assets or revenues, whether now owned or hereafter acquired, other
than the following (collectively, “Permitted Liens”):

 

(a)           Liens
pursuant to any Loan Document;

 

(b)           Liens
existing on the date hereof and listed on Schedule 7.01 and any
renewals or extensions thereof, provided that the property covered
thereby is not increased and any renewal or extension of the obligations secured
or benefited thereby is permitted by Section 7.03(b);

 

(c)           Liens for
Taxes or other governmental charges not yet due or which are being contested in
good faith and by appropriate proceedings diligently conducted, if adequate
reserves with respect thereto are maintained on the books of the applicable
Person in accordance with GAAP;

 

(d)           Liens
arising from operation of law, statutory liens, or carriers’, warehousemen’s,
mechanics’, materialmen’s, repairmen’s or other like Liens arising in the
ordinary course of business which are not overdue for a period of more than 30
days or which are being contested in good faith and by appropriate proceedings
diligently conducted if adequate reserves in accordance with GAAP with respect
thereto are maintained on the books of the applicable Person;

 

(e)           pledges or
deposits in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other social security legislation,
other than any Lien imposed by ERISA;

 

(f)            deposits
to secure the performance of bids, trade contracts and leases (other than
Indebtedness), statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature incurred in the ordinary course of
business;

 

(g)           title
exceptions accepted by Administrative Agent in the Second Lien Deed of Trust,
easements, rights-of-way, restrictions and other similar encumbrances affecting
real property which, in the aggregate, are not substantial in amount, and which
do not in any case materially detract from the value of the property subject
thereto or materially interfere with the ordinary conduct of the business of
the applicable Person;

 

(h)           Liens
securing judgments for the payment of money in an aggregate amount not in
excess of the $1,000,000 (except an amount in excess of the Threshold Amount to
the extent covered by independent third-party insurance as to which the insurer
does not dispute coverage), unless any such judgment remains undischarged for a
period of more than 30 consecutive days during which execution is not
effectively stayed;

 

(i)            Liens
securing Indebtedness permitted under Section 7.03(e); provided
that (i) such Liens do not at any time encumber any property other than
the property financed by such Indebtedness and the proceeds thereof and (ii) the
Indebtedness secured thereby does not exceed the cost or fair market value,
whichever is lower, of the property being acquired on the date of acquisition;

 

47

 

(j)            other
Liens securing Indebtedness in an aggregate principal amount not to exceed
$3,000,000 at any time outstanding;

 

(k)           Liens to
secure Capital Expenditures and purchase money financing not to exceed
$7,000,000;

 

(l)            Liens
securing Permitted Equipment Financing;

 

(m)          Liens
securing Indebtedness incurred pursuant to clause (t) of Section 7.03;
provided that (i) such Liens do not extend to, or encumber,
property which constitutes Collateral and (ii) such Liens extend only to
property of Foreign Subsidiaries;

 

(n)           Liens
arising in the ordinary course of business by virtue of any contractual,
statutory or common law provision relating to banker’s Liens, rights of set-off
or similar rights and remedies covering deposit or securities accounts
(including funds or other assets credited thereto) or other funds maintained
with a depository institution or securities intermediary;

 

(o)           Liens on
the property of a Person existing at the time such Person becomes a Subsidiary
of the Borrower in a transaction permitted hereunder securing Indebtedness; provided,
however, that any such Lien may not extend to any other property (other
than improvements and accessions thereto and proceeds of the assets to which
such Lien applies) of the Borrower; provided, further, that any
such Lien was not created in anticipation of or in connection with the
transaction or series of transactions pursuant to which such Person became a
Subsidiary of the Borrower;

 

(p)           Liens on
First Lien Collateral securing the Permitted First Lien Financing;

 

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

 

(r)            purported
Liens evidenced by the filing of precautionary UCC financing statements
relating solely to operating leases of personal property or consignment of
goods entered into in the ordinary course of business;

 

(s)           Liens
solely on any cash earnest money deposits made by the Borrower or any of its
Subsidiaries in connection with any letter of intent or purchase agreement
permitted hereunder;

 

(t)            licenses
of patents, trademarks and other intellectual property rights granted by the
Borrower or any of its Subsidiaries in the ordinary course of business and not
interfering in any material respect with the ordinary conduct of the business
of the Borrower or such Subsidiary; and

 

(u)           any Lien
constituting a replacement, extension, or renewal of any Lien of the type
described in clauses (a) through (t) above.

 

7.02        Investments.  Make any Investments, except:

 

48

 

(a)           Investments
other than those permitted by subsections (b) through (p) that
are existing on the date hereof and (i) are Investments in the Subsidiaries
listed on Schedule 5.13 or (ii) otherwise listed on Schedule 7.02;

 

(b)           Investments
made by the Borrower or any of its Subsidiaries in the form of Cash, Cash
Equivalents or other short-term marketable securities in accordance with the
Borrower’s investment policy as from time to time in effect;

 

(c)           advances
to officers, directors and employees of the Borrower and any of its
Subsidiaries in an aggregate amount not to exceed the Threshold Amount at any
time outstanding, for travel, entertainment, relocation and analogous ordinary
business purposes;

 

(d)           Investments
of the Borrower in any First Lien Guarantor and Investments of any First Lien
Guarantor in the Borrower or in another First Lien Guarantor;

 

(e)           Investments
consisting of advances to any Subsidiary that is not a First Lien Guarantor
evidenced by or in the nature of, as the case may be, promissory notes, open
accounts or capital contributions excluding trade accounts for services arising
in the ordinary course of business; provided that the aggregate amount
of such Investments does not exceed $1,000,000;

 

(f)            Investments
not to exceed $1,400,000 in connection with the Borrower’s purchase of the
interest of Elilario Italia SpA in European Air-Crane SpA;

 

(g)           Investments
consisting of extensions of credit in the nature of accounts receivable or
notes receivable arising from the sale or lease of goods or services in the
ordinary course of business, and Investments received in satisfaction or
partial satisfaction thereof from financially troubled account debtors to the
extent reasonably necessary in order to prevent or limit loss;

 

(h)           Guaranty
Obligations permitted by Section 7.03;

 

(i)            Investments
permitted by Section 7.04 and Section 7.05;

 

(j)            Permitted
Acquisitions made by the Borrower or any Subsidiary;

 

(k)           Capital
Expenditures permitted under Section 7.14;

 

(l)            Swap
Contracts to the extent permitted hereunder;

 

(m)          Intentionally
Omitted;

 

(n)           Intentionally
Omitted;

 

(o)           deposits,
prepayments and other credits to suppliers made in the ordinary course of
business consistent with the past practices of the Borrower and its
Subsidiaries; and

 

49

 

(p)           Investments
received in lieu of cash in connection with asset dispositions to the extent
permitted under Section 7.05.

 

7.03        Indebtedness.  Create, incur, assume or suffer to exist any
Indebtedness, except:

 

(a)           Indebtedness
under the Loan Documents;

 

(b)           Indebtedness
outstanding on the date hereof and listed on Schedule 7.03 and any
refinancings, refundings, renewals or extensions thereof; provided that
the amount of such Indebtedness is not increased at the time of such
refinancing, refunding, renewal or extension except by an amount equal to a
reasonable premium or other reasonable amount paid, and fees and expenses
reasonably incurred, in connection with such refinancing and by an amount equal
to any existing commitments unutilized thereunder;

 

(c)           Guaranty
Obligations of (i) the Borrower in respect of Indebtedness otherwise
permitted hereunder or under the First Lien Credit Agreement and (ii) any
First Lien Guarantor in respect of Indebtedness of such First Lien Guarantor
permitted under the First Lien Credit Agreement;

 

(d)           obligations
(contingent or otherwise) of the Borrower or any Subsidiary existing or arising
under any Swap Contract or currency risk management financial instrument; provided
that (i) such obligations are (or were) entered into by such Person in the
ordinary course of business for the purpose of directly mitigating risks
associated with liabilities, commitments, investments, assets, property, or
cash flows held or reasonably anticipated by such Person, or changes in the
value of securities issued by such Person and not for purposes of speculation
or taking a “market view”; and (ii) such Swap Contract or currency risk
management financial instrument does not contain any provision exonerating the
non-defaulting party from its obligation to make payments on outstanding
transactions to the defaulting party;

 

(e)           Indebtedness
in respect of capital leases, Synthetic Lease Obligations and purchase money
obligations for fixed or capital assets within the limitations set forth in Section 7.01(i);
provided that the aggregate amount of all such Indebtedness at any one
time outstanding shall not exceed $7,000,000;

 

(f)            Secured
or unsecured Indebtedness in an aggregate principal amount not to exceed
$2,000,000 at any time outstanding;

 

(g)           Guaranty
Obligations of the Borrower in respect of Indebtedness otherwise permitted
hereunder of any Subsidiary that is not a First Lien Guarantor in an aggregate
principal amount not to exceed the $2,000,000 at any time outstanding;

 

(h)           Permitted
Equipment Financing;

 

(i)            Permitted
First Lien Financing;

 

(j)            (i) loans
or advances among the Borrower and any First Lien Guarantor, (ii) loans or
advances made by a Subsidiary of the Borrower (or a Person that would become a
subsidiary of the Borrower after giving effect to such loan or advance) to the
Borrower or any

 

50

 

First Lien
Guarantor, (iii) loans or advances made by the Borrower or any First Lien
Guarantor in a Subsidiary of the Borrower that is not a First Lien Guarantor so
long as such loan or advance is permitted by Section 7.02;

 

(k)           Indebtedness
of a Person existing at the time such Person becomes a Subsidiary of the
Borrower or any First Lien Guarantor in a transaction permitted hereunder
(excluding Capital Leases and purchase money Indebtedness permitted hereunder)
in an aggregate principal amount not to exceed $1,000,000 for all such Persons
at any time outstanding; provided that any such Indebtedness was not
created in anticipation of or in connection with the transaction or series of
transactions pursuant to which such Person became a Subsidiary of the Borrower
or any First Lien Guarantor;

 

(l)            Indebtedness
incurred to repurchase Capital Stock of the Borrower from retired, deceased or
terminated employees or directors (including their heirs) of the Borrower or
any Subsidiary to the extent such Indebtedness is not secured and is
subordinated to the Obligations on terms reasonably acceptable to the
Administrative Agent; provided that no more than $1,000,000 in aggregate
principal amount of such Indebtedness may be outstanding at any time;

 

(m)          earn outs,
indemnities and purchase price adjustments pursuant to Permitted Acquisitions;

 

(n)           Indebtedness
which may be deemed to exist pursuant to any guaranties, performance, bid,
tender, appeal surety, statutory or similar obligations incurred in the
ordinary course of business;

 

(o)           Indebtedness
in respect of overdraft protections and otherwise in connection with deposit
accounts, in each case in the ordinary course of business;

 

(p)           guaranties
in the ordinary course of business of the obligations of suppliers, landlords,
customers and licensees of the Borrower and its Subsidiaries;

 

(q)           endorsements
for collection, deposit or negotiation and warranties of products or services,
in each case incurred in the ordinary course of business;

 

(r)            Indebtedness
in respect of employee benefit plans and programs, whether to current or
retired employees, including, without limitation, accrued expenses, pension
liabilities, deferred compensation, bonus plans, option plans, medical, dental
and other health plans and other similar plans providing benefits to employees
entered into in the ordinary course of business (but not including Indebtedness
under employment agreements);

 

(s)           Indebtedness
arising from judgments, orders or other awards to the extent not constituting
an Event of Default; and

 

(t)            Indebtedness
of Foreign Subsidiaries which does not exceed $2,000,000 in the aggregate at
any time outstanding.

 

51

 

7.04        Fundamental Changes.  Merge, dissolve, liquidate, consolidate with or
into another Person, or Dispose of (whether in one transaction or in a series
of transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to or in favor of any Person, except that, so long as no
Default or Event of Default exists or would result therefrom:

 

(a)           any
Subsidiary may merge with (i) the Borrower, provided that the
Borrower shall be the continuing or surviving Person, or (ii) any one or
more other Subsidiaries, provided that when any First Lien Guarantor or
wholly-owned Subsidiary is merging with another Subsidiary (which is not a
First Lien Guarantor), such First Lien Guarantor or wholly-owned Subsidiary
shall be the continuing or surviving Person;

 

(b)           any
Subsidiary that is not a First Lien Guarantor may dissolve or liquidate; provided
that the board of directors or senior management of the Borrower has determined
in good faith that the dissolution or liquidation will not be detrimental to
the business of the Borrower and its Subsidiaries, taken as a whole;

 

(c)           the
dissolution, liquidation or winding up of any Transitional Subsidiary; provided
that any assets of such Transitional Subsidiary shall be transferred to the
Borrower or any Subsidiary in connection therewith;

 

(d)           Investments
permitted under Section 7.02;

 

(e)           Dispositions
permitted under Section 7.05;

 

(f)            the
Borrower or any Subsidiary may merge with any Person as part of a Permitted
Acquisition; and

 

(g)           any
Subsidiary may Dispose of all or substantially all of its assets (upon
voluntary liquidation or otherwise), to the Borrower or to another Subsidiary; provided
that if the transferor in such a transaction is a First Lien Guarantor, then
the transferee must either be the Borrower or another First Lien Guarantor;

 

7.05        Dispositions.  Make any Disposition or enter into any
agreement to make any Disposition, except:

 

(a)           Dispositions
of obsolete, worn out property or other property no longer used or useful in
the business of the Borrower, whether now owned or hereafter acquired, in the
ordinary course of business;

 

(b)           Dispositions
of Term Financed Aircranes, inventory and other property (other than equipment
or real property) in the ordinary course of business (for the avoidance of
doubt, the sale or lease of manufactured and remanufactured aircranes is within
the ordinary course of business);

 

(c)           Dispositions
of equipment or real property to the extent that (i) such property is
exchanged for credit against the purchase price of similar replacement
property, (ii) the proceeds of such Disposition are reasonably promptly
applied to the purchase price of such replacement property or (iii) the
board of directors or senior management of the Borrower

 

52

 

or such
Subsidiary has determined in good faith that the failure to replace such
property will not be detrimental to the business of the Borrower or such
Subsidiary;

 

(d)           Dispositions
of property by any Subsidiary to the Borrower or to a wholly-owned Subsidiary; provided
that if the transferor of such property is a First Lien Guarantor, the
transferee thereof must either be the Borrower or a First Lien Guarantor;

 

(e)           Dispositions
permitted by Section 7.04;

 

(f)            Dispositions
not otherwise permitted under this Section 7.05 other than subsections (k) or
(m); provided that the Borrower shall have complied with the
requirements of Section 2.04;

 

(g)           licenses
of Intellectual Property (both exclusive and non-exclusive) in the ordinary
course of business and substantially consistent with past practice;

 

(h)           Investments
permitted under Section 7.02;

 

(i)            the sale,
transfer or disposition of accounts in connection with the collection or
compromise thereof in the ordinary course of business;

 

(j)            Capital
Stock issued in connection with Permitted Acquisitions;

 

(k)           any sale-leaseback
arrangements permitted hereby;

 

(l)            rights of
way, easements, and licenses necessary for the conduct of Borrower’s or any of
its Subsidiaries’ businesses; and

 

(m)          Dispositions
by the Borrower and its Subsidiaries not otherwise permitted under this Section 7.05;
provided that (i) at the time of such Disposition, no Default shall
exist or would result from such Disposition and (ii) the aggregate book
value of all property Disposed of in reliance on this clause (i) in
any fiscal year shall not exceed the Threshold Amount;

 

provided, however,
that any Disposition pursuant to clauses (a) through (m) shall
be for fair consideration.

 

7.06        Lease Obligations.  Create or suffer to exist any obligations for
the payment of rent for any property under lease or agreement to lease, except:

 

(a)           leases in
existence on the date hereof and listed on Schedule 7.06, and any
renewal, extension or refinancing thereof;

 

(b)           leases in
connection with any sale-leaseback arrangement permitted hereby;

 

(c)           capital
leases and Synthetic Lease Obligations to the extent permitted by Section 7.03;
and

 

53

 

(d)           operating
leases (other than those constituting Synthetic Lease Obligations) entered into
or assumed by the Borrower or any Subsidiary after the date hereof in the
ordinary course of business (for purposes hereof, all leases of real estate of
the Borrower or any Subsidiary shall be deemed operating leases), but in any
case the amount of all minimum future non-cancelable operating lease payments
shall not exceed $4,000,000.

 

7.07        Restricted Payments.  Declare or make, directly or indirectly, any
Restricted Payment, or incur any obligation (contingent or otherwise) to do so,
except that:

 

(a)           each
Subsidiary may make Restricted Payments to the Borrower and to wholly-owned
Subsidiaries (and, in the case of a Restricted Payment by a non-wholly-owned
Subsidiary, to the Borrower and any Subsidiary and to each other owner of
capital stock of such Subsidiary on a pro rata basis based on their relative
ownership interests);

 

(b)           the
Borrower and each Subsidiary may declare and make dividend payments or other
distributions payable solely in the common stock of such Person;

 

(c)           the
Borrower and each Subsidiary may purchase, redeem or otherwise acquire shares
of its common stock or other common equity interests or warrants or options to
acquire any such shares with the proceeds received from the substantially
concurrent issue of new shares of its common stock or other common equity interests;
and

 

(d)           provided
no Event of Default has occurred and is continuing under any Loan Documents, or
would result from the consummation of the transactions contemplated by this clause
(d), the Borrower may, without the Lenders’ prior consent, make payments to
the Manager for Management Fees under the Management Agreement in amounts not
exceeding $500,000 per annum, plus customary and reasonable out-of-pocket
expenses incurred in connection with performance under the Management Agreement
(for the avoidance of doubt, the payment of Management Fees shall not be
permitted after the occurrence and during the continuation of an Event of
Default; provided that, upon cure of any such Event of Default as
provided hereunder, Management Fees due and not paid during the continuation of
such cured Event of Default shall be permitted if such payment does not result
in a violation of Section 7.13.

 

7.08        ERISA.  At
any time engage in a transaction for the principal purpose of evading or
avoiding any liability under Title IV of ERISA as provided in Section 4069
or 4212(c) of ERISA, or permit any Plan to (a) engage in any
non-exempt “prohibited transaction” (as defined in Section 4975(c) of
the Code); (b) fail to comply with ERISA or any other applicable federal
or state Laws; or (c) incur any material “accumulated funding deficiency” (as
defined in Section 302 of ERISA for plan years commencing prior to 2008,
or the equivalent term under Section 302 of ERISA for plan years
commencing after 2007), which, with respect to each event listed above, could
reasonably be expected to have a Material Adverse Effect.

 

7.09        Change in Nature of Business.  Engage in any material line of business
substantially different from those lines of business conducted by the Borrower
and its Subsidiaries on the date hereof or any business substantially related
or incidental thereto or cease to conduct any line of business that constitutes
a material portion of the business of the Borrower and its Subsidiaries as of
the date hereof.

 

54

 

7.10        Transactions with Affiliates.  Enter into any transaction of any kind with
any Affiliate of the Borrower, whether or not in the ordinary course of
business, other than on fair and reasonable terms substantially as favorable to
the Borrower or such Subsidiary as would be obtainable by the Borrower or such
Subsidiary at the time in a comparable arm’s length transaction with a Person
other than an Affiliate; provided that (a) the foregoing
restriction shall not apply to transactions between or among the Borrower and
any First Lien Guarantor or between and among any First Lien Guarantors; (b) the
Borrower may make Investments consisting of advances and capital contributions
to Subsidiaries that are not First Lien Guarantors permitted under Section 7.02
at rates of interest that the Borrower deems reasonable under the
circumstances; (c) reasonable and customary fees may be paid to members of
the board of directors (or similar governing body) of U.S. Borrower or any of
its Subsidiaries; (d) compensation, benefits or indemnification
arrangements for officers and other employees of the Borrower or any of its
Subsidiaries may be entered into in the ordinary course of business; (e) the
existence of, and the performance by the Borrower of its obligations under the
terms of, any organizational documents or security holders agreement to which
it is a party on the Closing Date and which has been disclosed to the Lenders; (f) Restricted
Payments permitted hereunder; (g) transactions described in Schedule
7.10; (h) transactions among Subsidiaries of the Borrower that are not
First Lien Guarantors; (i) the transactions contemplated hereby, and (j) the
Borrower and any Subsidiary may engage in any transaction with an Affiliate (x) if
such transaction is in existence as of the date hereof, or (y) with the
prior written consent of the Administrative Agent.

 

7.11        Burdensome Agreements.  Enter into any Contractual Obligation (other
than this Agreement, any other Loan Document, the First Lien Loan Documents or
the Financed Aircraft Loan Documents) that (a) limits the ability (i) of
any Subsidiary to make Restricted Payments to the Borrower or any First Lien
Guarantor or to otherwise transfer property to the Borrower or any First Lien
Guarantor, (ii) of any Subsidiary to guarantee the Indebtedness of the
Borrower or (iii) of the Borrower or any Subsidiary to create, incur,
assume or suffer to exist Liens on property of such Person (other than Liens
permitted hereunder) (provided, however, that this clause (iv) shall
not prohibit any negative pledge incurred or provided in favor of any holder of
Indebtedness permitted under Section 7.03 solely to the extent any
such negative pledge relates to the property financed by or the subject of such
Indebtedness and the proceeds thereof); or (b) requires the grant of a
Lien to secure an obligation of such Person if a Lien is granted to secure
another obligation of such Person; provided that the foregoing
restrictions shall not apply to restrictions (i) by reason of customary
provisions restricting assignments, subletting or other transfers contained in
leases, licenses, joint venture agreements and similar agreements entered into
in the ordinary course of business; (ii) that are or were created by
virtue of any transfer of, agreement to transfer or option or right with
respect to any property, assets or Capital Stock not otherwise prohibited under
this Agreement; (iii) in any agreement for the sale or other disposition
of a Subsidiary that restricts distributions by that Subsidiary pending the
sale or other disposition; (iv) in any instrument governing Indebtedness
or Capital Stock of a Person acquired by the Borrower or any of its
Subsidiaries as in effect at the time of such acquisition (except to the extent
such Indebtedness or Capital Stock was incurred in connection with or in
contemplation of such acquisition), which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other than
the Person or the property or assets of the Person, so acquired (provided
that, in the case of Indebtedness, such Indebtedness was permitted by Section 7.03);
and (v) restrictions in effect on the Closing Date and set forth on Schedule 7.11.

 

55

 

7.12        Margin Regulations.  Use the proceeds of the Borrower, whether
directly or indirectly, and whether immediately, incidentally or ultimately, to
purchase or carry margin stock (within the meaning of Regulation U
of the FRB) or to extend credit to others for the purpose of purchasing or
carrying margin stock or to refund indebtedness originally incurred for such
purpose, in each case in violation of, or for a purpose which violates, or
would be inconsistent with, Regulation T, U or X of
the FRB.

 

7.13        Financial
Covenants.

 

(a)           Minimum
Net Worth.  Permit Net Worth of the
Borrower to be less than (i) $20,000,000 as of December 31, 2007, and
(ii) $20,000,000 as of December 31 of each year thereafter plus an
amount equal to 75% of the positive GAAP annual net income, net of the effect
of unrealized gains and losses on unbalanced currency and interest rate hedging
positions, earned in each fiscal year beginning with the fiscal year ending December 31,
2008, tested at the end of each fiscal year.

 

(b)           Minimum
Fixed Charge Coverage Ratio.  Permit
the Fixed Charge Coverage Ratio as of the end of any fiscal quarter of the
Borrower to be less than 1.00 to 1.00, beginning with the fiscal quarter ending
December 31, 2007.  (For the
purposes of calculating the Fixed Charge Coverage Ratio for the fiscal quarters
ending through March 31, 2008, there shall be excluded from the
calculation of Capital Expenditures $3,302,967 associated with Aircrane with
registration number N189AC plus $1,724,484 associated with Aircrane with
registration number N165AC incurred in 2007).

 

(c)           Maximum
Total Funded Debt to Adjusted EBITDA Ratio. 
Permit the Total Funded Debt to Adjusted EBITDA Ratio as of the end of
any fiscal quarter of the Borrower set forth for the preceding four fiscal
quarter periods to be greater than the ratio set forth below opposite such
fiscal quarter:

 

	
  Fiscal Quarters Ending

  	
   

  	
  Maximum Total Funded

  Debt to Adjusted EBITDA

  Ratio

  
	
   

  	
   

  	
   

  
	
  December 31, 2007

  	
   

  	
  5.40 to 1.00

  
	
   

  	
   

  	
   

  
	
  March 31, 2008

  	
   

  	
  5.70 to 1.00

  
	
   

  	
   

  	
   

  
	
  June 30, 2008

  	
   

  	
  5.10 to 1.00

  
	
   

  	
   

  	
   

  
	
  September 30, 2008

  	
   

  	
  5.10 to 1.00

  
	
   

  	
   

  	
   

  
	
  December 31, 2008

  	
   

  	
  4.80 to 1.00

  
	
   

  	
   

  	
   

  
	
  March 31, 2009

  	
   

  	
  5.40 to 1.00

  
	
   

  	
   

  	
   

  
	
  June 30, 2009

  	
   

  	
  5.10 to 1.00

  
	
   

  	
   

  	
   

  
	
  September 30, 2009

  	
   

  	
  5.10 to 1.00

  
	
   

  	
   

  	
   

  
	
  December 31, 2009

  	
   

  	
  4.80 to 1.00

  

 

56

 

	
  March 31, 2010

  	
   

  	
  5.10 to 1.00

  
	
   

  	
   

  	
   

  
	
  June 30, 2010

  	
   

  	
  4.80 to 1.00

  
	
   

  	
   

  	
   

  
	
  September 30, 2010

  	
   

  	
  4.80 to 1.00

  
	
   

  	
   

  	
   

  
	
  December 31, 2010

  	
   

  	
  4.50 to 1.00

  
	
   

  	
   

  	
   

  
	
  March 31, 2011

  	
   

  	
  4.80 to 1.00

  
	
   

  	
   

  	
   

  
	
  June 30, 2011

  	
   

  	
  4.50 to 1.00

  
	
   

  	
   

  	
   

  
	
  September 30, 2011

  	
   

  	
  4.50 to 1.00

  
	
   

  	
   

  	
   

  
	
  December 31, 2011 and thereafter

  	
   

  	
  4.20 to 1.00

  

 

(d)           Maximum
Senior Funded Debt to Adjusted EBITDA Ratio.  Permit the Senior Funded Debt to Adjusted
EBITDA Ratio as of the end of any fiscal quarter of Borrower set forth for the
preceding four fiscal quarter periods to be greater than the ratio set forth
opposite such fiscal quarter:

 

	
  Fiscal Quarters Ending

  	
   

  	
  Maximum Senior Debt to

  Adjusted EBITDA

  
	
   

  	
   

  	
   

  
	
  December 31,
  2007

  	
   

  	
  4.50 to 1.00

  
	
   

  	
   

  	
   

  
	
  March 31,
  2008

  	
   

  	
  4.80 to 1.00

  
	
   

  	
   

  	
   

  
	
  June 30,
  2008

  	
   

  	
  4.20 to 1.00

  
	
   

  	
   

  	
   

  
	
  September 30,
  2008

  	
   

  	
  4.20 to 1.00

  
	
   

  	
   

  	
   

  
	
  December 31,
  2008

  	
   

  	
  3.90 to 1.00

  
	
   

  	
   

  	
   

  
	
  March 31,
  2009

  	
   

  	
  4.50 to 1.00

  
	
   

  	
   

  	
   

  
	
  June 30,
  2009

  	
   

  	
  4.20 to 1.00

  
	
   

  	
   

  	
   

  
	
  September 30,
  2009

  	
   

  	
  4.20 to 1.00

  
	
   

  	
   

  	
   

  
	
  December 31,
  2009

  	
   

  	
  3.90 to 1.00

  
	
   

  	
   

  	
   

  
	
  March 31,
  2010

  	
   

  	
  4.20 to 1.00

  
	
   

  	
   

  	
   

  
	
  June 30,
  2010

  	
   

  	
  3.90 to 1.00

  
	
   

  	
   

  	
   

  
	
  September 30,
  2010

  	
   

  	
  3.90 to 1.00

  
	
   

  	
   

  	
   

  
	
  December 31,
  2010

  	
   

  	
  3.60 to 1.00

  
	
   

  	
   

  	
   

  
	
  March 31,
  2011

  	
   

  	
  3.90 to 1.00

  
	
   

  	
   

  	
   

  
	
  June 30,
  2011

  	
   

  	
  3.60 to 1.00

  

 

57

 

	
  September 30,
  2011

  	
   

  	
  3.60 to 1.00

  
	
   

  	
   

  	
   

  
	
  December 31, 2001 and thereafter

  	
   

  	
  3.30 to 1.00

  

 

7.14        Maximum Capital Expenditures.  Permit its Capital Expenditures to exceed
$7,000,000 in the aggregate during any fiscal year during the term of the Loan,
provided that the difference between $7,000,000 less the actual Capital
Expenditures in any given year greater than $0 may be carried over to the
immediately following year and shall not be included in the limitation on
Capital Expenditures in such carry-over year for purposes of this Section 7.14;
provided, further, that for the fiscal year ending December 31,
2007 there shall be excluded from the calculation of Capital Expenditures for
such fiscal year Capital Expenditures in an amount equal to $3,302,967
associated with Aircrane with registration number N189AC and Capital
Expenditures in an amount equal to $1,724,484 associated with Aircrane with
registration number N165AC.

 

7.15        No Domestic Subsidiaries.  Create or acquire any Domestic Subsidiary; provided,
however, that, notwithstanding anything to the contrary in this
Agreement, no Permitted Acquisition may result in the acquisition of any
Domestic Subsidiary.

 

7.16        No Second Lien Pledge of Accounts Receivables.  Create or
suffer to exist any Lien upon any accounts receivable to secure any obligations
other than the Liens created under the Permitted First Lien Financing.

 

VIII.

EVENTS OF DEFAULT AND REMEDIES

 

8.01        Events of Default.  The occurrence of the following events shall
constitute an “Event of Default” hereunder:

 

(a)           Non-Payment.  The Borrower fails to pay, (i) when and
as required to be paid herein, whether at stated maturity, by acceleration, by
notice of voluntary prepayment, by mandatory prepayment or otherwise, any
amount of principal of any Loan, or (ii) within five days after the same
becomes due, any interest on any Loan, or any fee due hereunder, or (iii) within
five days after the same becomes due, any other amount payable hereunder or
under any other Loan Document; or

 

(b)           Specific
Covenants.  The Borrower fails to perform
or observe any term, covenant or agreement contained in any of Sections 6.04,
6.05, 6.11, 6.14, 6.16, 7.01 (for any Lien
senior to the Lenders’ Lien and in excess of the Threshold Amount), 7.04,
7.05, 7.07, 7.08, 7.09, 7.12, or 7.13;
or

 

(c)           Other Defaults.  The Borrower fails to perform or observe any
other material covenant or agreement (not specified in subsection (a) or
(b) above) contained in any of Sections 6.01, 6.02,
6.03, 6.07, 6.09, 6.10, 6.15, 7.01
(to the extent not covered by clause (b) above), 7.03, 7.06,
or 7.11 on its part to be performed or observed and such failure
continues for 30 days; provided that, with respect to any material
covenant or agreement in Sections 6.06, 6.08, 6.12, 6.13,
7.02 or 7.10, such 30-day cure period may be extended for up to a
maximum of

 

58

 

90 days if (i) such
failure is curable or correctable, but reasonably cannot be cured within 30
days, (ii) the Borrower is diligently pursuing the cure or correction of
such failure, and (iii) no Material Adverse Effect would result from the
granting of such extension; or

 

(d)           Representations
and Warranties.  Any material
representation or warranty made or deemed made by the Borrower herein, in any
other Loan Document, or in any document delivered in connection herewith or
therewith proves to have been incorrect when made or deemed made, unless such
inaccuracy shall not be material to the recipient at the time when the notice
referred to below shall have been received by the Borrower or any material
adverse impact thereof shall have been cured or corrected within 30 days after
the earlier of (i) the Borrower becoming aware of such event, and (ii) receipt
by the Borrower of a written notice thereof from the Administrative Agent or
any Lender; or

 

(e)           Cross-Default.  (i) The Borrower or any First Lien
Guarantor (A) fails to make any payment when due (whether by scheduled
maturity, required prepayment, acceleration, demand, or otherwise) in respect
of any Indebtedness or Guaranty Obligation (other than Indebtedness hereunder
and Indebtedness under Swap Contracts) having an aggregate principal amount
(including undrawn committed or available amounts and including amounts owing
to all creditors under any combined or syndicated credit arrangement) of more
than the $1,000,000 Amount, or (B) fails to observe or perform any other
material agreement or condition relating to any other Indebtedness or Guaranty
Obligation or contained in any instrument or agreement evidencing, securing or
relating thereto, or any other event occurs, in each case under this clause (B) the
effect of which default or other event is that the holder or holders of such
Indebtedness or the beneficiary or beneficiaries of such Guaranty Obligation
(or a trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) shall have caused, with the giving of notice if required, such
Indebtedness to be demanded or to become due or to be repurchased, prepaid,
defeased or redeemed (automatically or otherwise), or offered to repurchase,
prepay, defease or redeem such Indebtedness to be made, prior to its stated
maturity, or such Guaranty Obligation to become payable or Cash Collateral in
respect thereof to be demanded; or (ii) there occurs under any Swap Contract
an Early Termination Date (as defined therein or such equivalent term)
resulting from (A) any event of default under such Swap Contract as to
which the Borrower or any Subsidiary is the defaulting party or (B) any
Termination Event (as so defined) under such Swap Contract as to which the
Borrower or any Subsidiary is an Affected Party (as so defined) and, in either
event, the Swap Termination Value (as so defined) owed by the Borrower or such
Subsidiary as a result thereof is greater than the Threshold Amount; or (iii) an
“event of default” occurs under the Permitted First Lien Financing or the
Permitted Equipment Financing (provided that, with respect to any breach
or default under the Permitted First Lien Financing, such event shall only
constitute an Event of Default under this Agreement if such event occurs and is
not cured or waived within 60 days after notice of such event from the First
Lien Administrative Agent or any Revolving Lender (other than with respect to
an acceleration under the First Lien Credit Agreement)).

 

(f)            Insolvency
Proceedings, Etc.  The Borrower
institutes or consents to the institution of any proceeding under any Debtor
Relief Law, or makes an assignment for the benefit of creditors; or applies for
or consents to the appointment of any receiver, trustee, custodian,
conservator, liquidator, rehabilitator or similar officer for it or for all or
any material part of its property; or any receiver, trustee, custodian,
conservator, liquidator, rehabilitator or

 

59

 

similar
officer is appointed without the application or consent of such Person and the
appointment continues undischarged or unstayed for 60 calendar days; or any
proceeding under any Debtor Relief Law relating to any such Person or to all or
any material part of its property is instituted without the consent of such
Person and continues undismissed or unstayed for 60 calendar days, or an order
for relief is entered in any such proceeding; or

 

(g)           Inability
to Pay Debts; Attachment.  (i) The
Borrower becomes unable or admits in writing its inability or fails generally
to pay its debts as they become due, or (ii) any writ or warrant of
attachment or execution or similar process is issued or levied against all or
any material part of the property of any such Person and is not released,
vacated or fully bonded within 60 days after its issue or levy; or

 

(h)           Judgments.  There is entered against the Borrower (i) a
final judgment or order for the payment of money in an aggregate amount
exceeding $1,000,000 (or such greater amount to the extent covered by
independent third-party insurance as to which there is no dispute regarding
coverage with respect to such judgment), or (ii) a final non-appealable
non-monetary judgment that could reasonably be expected to have a Material
Adverse Effect, and (A) enforcement proceedings are commenced by any
creditor upon such judgment or order, or (B) there is a period of 20
consecutive days during which a stay of enforcement of such judgment, by reason
of a pending appeal or otherwise, is not in effect, or (C) any final
judgment is not paid or otherwise satisfied within a period of 20 days from the
date of judgment; or

 

(i)            ERISA.  (i) An ERISA Event occurs with respect
to a Pension Plan or Multiemployer Plan which has resulted or could reasonably
be expected to result in liability of the Borrower under Title IV of ERISA to
the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in
excess of the Threshold Amount, or (ii) the Borrower or any ERISA
Affiliate fails to pay when due, after the expiration of any applicable grace
period, any installment payment with respect to its withdrawal liability under Section 4201
of ERISA under a Multiemployer Plan in an aggregate amount in excess of $1,000,000;
or

 

(j)            Change
of Control.  There occurs any Change
of Control with respect to the Borrower, except as has been approved in writing
by Lenders; or

 

(k)           Intentionally
Omitted.

 

(l)            Failure
of Security.  Any Collateral Document
ceases to be in full force and effect, or is declared by a court of competent
jurisdiction to be null and void, invalid or unenforceable in any respect; or
the Administrative Agent shall not have or shall cease to have a valid and
perfected Lien of second priority (other than Liens expressly permitted to be
prior to such Lien pursuant to Section 7.01) in the Collateral
purported to be covered thereby having a fair market value, individually or in
the aggregate, exceeding $2,000,000, in each case for any reason other than (i) the
agreement of all the Lenders or satisfaction in full of all the Obligations or (ii) the
failure of the Administrative Agent or any Lender to take any action within its
exclusive control; or

 

(m)          Invalidity
of Loan Documents.  Any other Loan
Document or any provision thereof, at any time after its execution and delivery
and for any reason other than the

 

60

 

agreement
of all the Lenders or satisfaction in full of all the Obligations, ceases to be
in full force and effect, or is declared by a court of competent jurisdiction
to be null and void, invalid or unenforceable in any respect; or the Borrower
denies that it has any or further liability or obligation under any other Loan
Document, or purports to revoke, terminate or rescind any Loan Document; or

 

(n)           Material
Adverse Effect.  A Material Adverse
Effect occurs, other than an event included within clauses (a) through (m)
above.

 

8.02        Remedies Upon Event of Default.  If any Event of Default occurs and is
continuing, the Administrative Agent shall, at the request of, or may, with the
consent of, the Required Lenders take any or all of the following actions,

 

(a)           declare
the commitment of each Lender to make Loans to be terminated, whereupon such
commitments shall be terminated;

 

(b)           declare
the unpaid principal amount of all outstanding Loans, all interest accrued and
unpaid thereon, and all other amounts owing or payable hereunder or under any
other Loan Document to be immediately due and payable, without presentment,
demand, protest or other notice of any kind, all of which are hereby expressly
waived by the Borrower; and

 

(c)           exercise
on behalf of itself and the Lenders all rights and remedies available to it and
the Lenders under the Loan Documents or applicable Law;

 

provided, however,
that upon the occurrence of an actual or deemed entry of an order for relief
with respect to the Borrower under the Bankruptcy Code of the United States,
the obligation of each Lender to make Loans shall automatically terminate and
the unpaid principal amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable, in each case,
without further act of the Administrative Agent or any Lender.

 

8.03        Application of Funds.  After the exercise of remedies provided for
in Section 8.02 (or after the Loans have automatically become
immediately due and payable as set forth in the proviso to Section 8.02),
any amounts received on account of the Obligations shall be applied by the
Administrative Agent in the following order:

 

First, to payment of that portion
of the Obligations constituting fees, indemnities, expenses and other amounts
(including Attorney Costs and amounts payable under Article III) payable
to the Administrative Agent in its capacity as such;

 

Second, to payment of that portion
of the Obligations constituting fees, indemnities and other amounts (other than
principal and interest) payable to the Lenders (including Attorney Costs and
amounts payable under Article III), ratably among them in
proportion to the amounts described in this clause Second payable to
them;

 

Third, to payment of that portion
of the Obligations constituting accrued and unpaid interest on the Loans,
ratably among the Lenders and their Affiliates in proportion to the respective
amounts described in this clause Third payable to them;

 

61

 

Fourth, to payment of that portion
of the Obligations constituting unpaid principal of the Loans, ratably among
the Lenders and their Affiliates in proportion to the respective amounts
described in this clause Fourth held by them;

 

Last, the balance, if any, after
all of the Obligations have been indefeasibly paid in full, to the Borrower or
as otherwise required by Law.

 

IX.

ADMINISTRATIVE AGENT

 

9.01        Appointment and Authorization of Administrative Agent.  Each Lender hereby irrevocably appoints,
designates and authorizes the Administrative Agent to take such action on its
behalf under the provisions of this Agreement and each other Loan Document and
to exercise such powers and perform such duties as are expressly delegated to
it by the terms of this Agreement or any other Loan Document, together with
such powers as are reasonably incidental thereto.  Notwithstanding any provision to the contrary
contained elsewhere herein or in any other Loan Document, the Administrative
Agent shall not have any duties or responsibilities, except those expressly set
forth herein, nor shall the Administrative Agent have or be deemed to have any
fiduciary relationship with any Lender or participant, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities
shall be read into this Agreement or any other Loan Document or otherwise exist
against the Administrative Agent. 
Without limiting the generality of the foregoing sentence, the use of
the term “agent” herein and in the other Loan Documents with reference to the
Administrative Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable
law.  Instead, such term is used merely
as a matter of market custom, and is intended to create or reflect only an
administrative relationship between independent contracting parties.

 

9.02        Delegation of Duties.  The Administrative Agent may execute any of
its duties under this Agreement or any other Loan Document by or through
agents, employees or attorneys-in-fact and shall be entitled to advice of
counsel and other consultants or experts concerning all matters pertaining to
such duties.  The Administrative Agent
shall not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects in the absence of gross negligence or willful
misconduct.

 

9.03        Liability of Administrative Agent.  No Agent-Related Person shall (a) be
liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct
in connection with its duties expressly set forth herein), or (b) be
responsible in any manner to any Lender or participant for any recital,
statement, representation or warranty made by the Borrower or any officer
thereof, contained herein or in any other Loan Document, or in any certificate,
report, statement or other document referred to or provided for in, or received
by the Administrative Agent under or in connection with, this Agreement or any
other Loan Document, or for the value of or title to any Collateral, or the
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document, or for any failure of the Borrower or any
other party to any Loan Document to perform its obligations hereunder or
thereunder.  No Agent-Related Person
shall be

 

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under any obligation to any
Lender or participant to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement or any other Loan Document, or to inspect the properties, books or
records of the Borrower or any Affiliate thereof.

 

9.04        Reliance
by Administrative Agent.

 

(a)           The
Administrative Agent shall be entitled to rely, and shall be fully protected in
relying, upon any writing, signature, resolution, representation, notice,
consent, certificate, affidavit, letter, telegram, facsimile, telex or
statement 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 (including counsel to the Borrower),
independent accountants and other experts selected by the Administrative
Agent.  The Administrative Agent shall be
fully justified in failing or refusing to take any action under any Loan
Document unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate and, if it so requests, it shall first
be indemnified to its reasonable satisfaction by the Lenders against any and
all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action.  The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement or any other Loan Document in
accordance with a request or consent of the Required Lenders or all the Lenders,
if required hereunder, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and participants.  Where this Agreement expressly permits or
prohibits an action unless the Required Lenders otherwise determine, the
Administrative Agent shall, and in all other instances, the Administrative
Agent may, but shall not be required to, initiate any solicitation for the
consent or a vote of the Lenders.

 

(b)           For
purposes of determining compliance with the conditions specified in Section 4.01,
each Lender that has signed this Agreement shall be deemed to have consented
to, approved or accepted or to be satisfied with, each document or other matter
either sent by the Administrative Agent to such Lender for consent, approval,
acceptance or satisfaction, or required thereunder to be consented to or
approved by or acceptable or satisfactory to a Lender.

 

9.05        Notice of Default.  The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of
Default, except with respect to defaults in the payment of principal, interest
and fees required to be paid to the Administrative Agent for the account of the
Lenders, unless the Administrative Agent shall have received written notice
from a Lender or the Borrower referring to this Agreement, describing such
Default or Event of Default and stating that such notice is a “notice of
default.”  The Administrative Agent will
notify the Lenders of its receipt of any such notice.  The Administrative Agent shall take such
action with respect to such Default or Event of Default as may be directed by
the Required Lenders in accordance with Article VIII; provided,
however, that unless and until the Administrative Agent has received any
such direction, the Administrative Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such
Default or Event of Default as it shall deem advisable or in the best interest
of the Lenders.

 

63

 

9.06        Credit Decision; Disclosure of Information by Administrative
Agent.  Each Lender acknowledges that
no Agent-Related Person has made any representation or warranty to it, and that
no act by the Administrative Agent hereafter taken, including any consent to
and acceptance of any assignment or review of the affairs of the Borrower or
any Affiliate thereof, shall be deemed to constitute any representation or
warranty by any Agent-Related Person to any Lender as to any matter, including
whether Agent-Related Persons have disclosed material information in their
possession.  Each Lender represents to
the Administrative Agent that it has, independently and without reliance upon
any Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Borrower and its Subsidiaries, the value of and title
to any Collateral, and all applicable bank or other regulatory Laws relating to
the transactions contemplated hereby, and made its own decision to enter into
this Agreement and to extend credit to the Borrower.  Each Lender also represents that it will,
independently and without reliance upon any Agent-Related Person and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to
make such investigations as it deems necessary to inform itself as to the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Borrower.  Except
for notices, reports and other documents expressly required to be furnished to
the Lenders by the Administrative Agent herein, the Administrative Agent shall
not have any duty or responsibility to provide any Lender with any credit or
other information concerning the business, prospects, operations, property,
financial and other condition or creditworthiness of any of the Borrower or any
of its Affiliates which may come into the possession of any Agent-Related
Person.

 

9.07        Indemnification of Administrative Agent.  Whether or not the transactions contemplated
hereby are consummated, the Lenders shall indemnify upon demand each
Agent-Related Person (to the extent not reimbursed by or on behalf of the
Borrower and without limiting the obligation of the Borrower to do so), pro
rata, and hold harmless each Agent-Related Person from and against any and all
Indemnified Liabilities incurred by it; provided, however, that
no Lender shall be liable for the payment to any Agent-Related Person of any
portion of such Indemnified Liabilities to the extent determined in a final,
nonappealable judgment by a court of competent jurisdiction to have resulted
from such Person’s own gross negligence or willful misconduct; provided,
however, that no action taken in accordance with the directions of the
Required Lenders shall be deemed to constitute gross negligence or willful
misconduct for purposes of this Section 9.07.  Without limitation of the foregoing, each
Lender shall reimburse the Administrative Agent upon demand for its ratable share
of any costs or out-of-pocket expenses (including Attorney Costs) incurred by
the Administrative Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of rights or responsibilities under, this Agreement, any other Loan
Document, or any document contemplated by or referred to herein, to the extent
that the Administrative Agent is not reimbursed for such expenses by or on
behalf of the Borrower.  The undertaking
in this Section 9.07 shall survive termination of the Commitments,
the payment of all Obligations hereunder and the resignation or replacement of
the Administrative Agent.

 

64

 

9.08        Administrative Agent in its Individual Capacity.  DBZ and its Affiliates may make loans to,
issue letters of credit for the account of, accept deposits from, acquire
equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with the Borrower and its
Affiliates as though DBZ were not the Administrative Agent hereunder and
without notice to or consent of the Lenders. 
The Lenders acknowledge that, pursuant to such activities, DBZ or its
Affiliates may receive information regarding the Borrower or its Affiliates
(including information that may be subject to confidentiality obligations in
favor of the Borrower or such Affiliate) and acknowledge that the Administrative
Agent shall be under no obligation to provide such information to them.  With respect to its Loans, DBZ shall have the
same rights and powers under this Agreement as any other Lender and may
exercise such rights and powers as though it were not the Administrative Agent,
and the terms “Lender” and “Lenders” shall include DBZ in its individual
capacity.

 

9.09        Successor Administrative Agent.  The Administrative Agent may resign as
Administrative Agent upon 30 days’ notice to the Lenders and the Borrower.  If the Administrative Agent resigns under
this Agreement, the Required Lenders shall appoint from among the Lenders a
successor administrative agent for the Lenders which successor administrative
agent shall be consented to by the Borrower at all times other than following
the exercise of remedies by the Lenders during the existence of an Event of
Default (which consent of the Borrower shall not be unreasonably withheld or
delayed).  If no successor administrative
agent is appointed prior to the effective date of the resignation of the
Administrative Agent, the Administrative Agent may appoint, after consulting
with the Lenders, and with the consent of the Borrower, a successor
administrative agent from among the Lenders. 
Upon the acceptance of its appointment as successor administrative agent
hereunder, the Person acting as such successor administrative agent shall
succeed to all the rights, powers and duties of the retiring Administrative
Agent and the term “Administrative Agent” shall mean such successor
administrative agent and the retiring Administrative Agent’s appointment,
powers and duties as Administrative Agent shall be terminated, without any
other or further act or deed on the part of any other Lender.  After any retiring Administrative Agent’s
resignation hereunder as Administrative Agent, the provisions of this Article IX
and Sections 10.04 and 10.05 shall inure to its benefit as
to any actions taken or omitted to be taken by it while it was Administrative
Agent under this Agreement.  If no
successor administrative agent has accepted appointment as Administrative Agent
by the date which is 30 days following a retiring Administrative Agent’s notice
of resignation, the retiring Administrative Agent’s resignation shall
nevertheless thereupon become effective and the Lenders shall perform all of
the duties of the Administrative Agent hereunder until such time, if any, as
the Required Lenders appoint a successor agent as provided for above.

 

9.10        Collateral and Guaranty Matters.  The Lenders irrevocably authorize the
Administrative Agent, at its option and in its discretion,

 

(a)           to release
any Lien on any property granted to or held by the Administrative Agent under
any Loan Document (i) upon termination of the Commitments and payment in
full of all Obligations (other than contingent indemnification obligations), (ii) that
is sold or to be sold as part of or in connection with any sale permitted
hereunder or under any other Loan Document, (iii) consisting of an
instrument evidencing Indebtedness or other debt

 

65

 

instrument,
if the indebtedness evidenced thereby has been paid in full, or (iv) subject
to Section 10.01, if approved, authorized or ratified in writing by
the Required Lenders; and

 

(b)           to subordinate
any Lien on any property granted to or held by the Administrative Agent under
any Loan Document to the holder of any Lien on such property that is permitted
by Section 7.01(i).

 

Upon request by the Administrative Agent at any
time, the Required Lenders will confirm in writing the Administrative Agent’s
authority to release or subordinate its interest in particular types or items
of property.

 

X.

MISCELLANEOUS

 

10.01      Amendments, Etc.  No amendment or
waiver of any provision of this Agreement or any other Loan Document, and no
consent to any departure by the Borrower therefrom, shall be effective unless
in writing signed by the Required Lenders and the Borrower, and acknowledged by
the Administrative Agent, and each such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given; provided,
however, that no such amendment, waiver or consent shall:

 

(a)           waive any
condition set forth in Sections 4.01(a) through (c) without
the written consent of each Lender;

 

(b)           extend or
increase the Commitment of any Lender (or reinstate any Commitment terminated
pursuant to Section 8.02) without the written consent of such
Lender;

 

(c)           postpone
any date fixed by this Agreement or any other Loan Document for any payment or
mandatory prepayment of principal, interest, fees or other amounts due to the
Lenders (or any of them) hereunder or under any other Loan Document without the
written consent of each Lender directly affected thereby;

 

(d)           reduce the
principal of, or the rate of interest specified herein on, any Loan, or
(subject to the second proviso to this Section 10.01) any fees or
other amounts payable hereunder or under any other Loan Document; provided,
however, that only the consent of the Required Lenders shall be
necessary to amend the definition of “Default Rate” or to waive any
obligation of the Borrower to pay interest at the Default Rate;

 

(e)           change Section 2.07
or Section 8.03 in a manner that would alter the pro rata sharing
of payments required thereby without the written consent of each Lender;

 

(f)            change
any provision of this Section 10.01 or the definition of “Required
Lenders” or any other provision hereof specifying the number or percentage
of Lenders required to amend, waive or otherwise modify any rights hereunder or
make any determination or grant any consent hereunder, without the written
consent of each Lender; or

 

(g)           release or
otherwise subordinate all or substantially all of the Collateral without the
written consent of each Lender, except as otherwise may be provided in the

 

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Collateral
Document or except where the consent of the Required Lenders only is
specifically provided for;

 

and, provided further,
that the Fee Letter may be amended, or rights or privileges thereunder waived,
only in a writing executed by the parties thereto.  Notwithstanding anything to the contrary
herein, any Lender that has failed to fund any portion of any Borrowing required
to be funded by it hereunder or that has a Voting Percentage deemed to be zero
shall not have any right to approve or disapprove any amendment, waiver or
consent hereunder, except that the Commitment of such Lender may not be
increased or extended without the consent of such Lender.

 

10.02      Notices
and Other Communications; Facsimile Copies.

 

(a)           General.  Unless otherwise expressly provided herein,
all notices and other communications provided for hereunder shall be in writing
(including by facsimile transmission) and mailed, faxed or delivered, to the
address, facsimile number or electronic mail address specified for notices on Schedule 10.02;
or, in the case of the Borrower or the Administrative Agent, to such other
address as shall be designated by such party in a notice to the other parties,
and in the case of any other party, to such other address as shall be
designated by such party in a notice to the Borrower and the Administrative
Agent.  All such notices and other
communications shall be deemed to be given or made upon the earlier to occur of
(i) actual receipt by the intended recipient and (ii) (A) if
delivered by hand or by courier, when signed for by the intended recipient; (B) if
delivered by mail, four Business Days after deposit in the mails, postage
prepaid; (C) if delivered by facsimile, when sent and receipt has been
confirmed by telephone; and (D) if delivered by electronic mail when
delivered; provided, however, that notices and other
communications to the Administrative Agent pursuant to Article II
shall not be effective until actually received by such Person.  Any notice or other communication permitted
to be given, made or confirmed by telephone hereunder shall be given, made or
confirmed by means of a telephone call to the intended recipient at the number
specified on Schedule 10.02, it being understood and agreed that a
voicemail message shall in no event be effective as a notice, communication or
confirmation hereunder.

 

(b)           Effectiveness
of Facsimile Documents and Signatures. 
Loan Documents may be transmitted and/or signed by facsimile.  The effectiveness of any such documents and
signatures shall, subject to applicable Law, have the same force and effect as
manually-signed originals and shall be binding on all the Borrower, the Administrative
Agent and the Lenders.  The Administrative
Agent may also require that any such documents and signatures be confirmed by a
manually-signed original thereof; provided, however, that the
failure to request or deliver the same shall not limit the effectiveness of any
facsimile document or signature.

 

(c)           Limited
Use of Electronic Mail.  Electronic
mail and internet and intranet websites may be used only to distribute routine
communications, such as financial statements and other information, and to
distribute Loan Documents for execution by the parties thereto, and may not be
used for any other purpose.

 

(d)           Reliance
by Administrative Agent and Lenders. 
The Administrative Agent and the Lenders shall be entitled to rely and
act upon any notices (including telephonic

 

67

 

Loan
Notices) purportedly given by or on behalf of the Borrower even if (i) such
notices were not made in a manner specified herein, were incomplete or were not
preceded or followed by any other form of notice specified herein, or (ii) the
terms thereof, as understood by the recipient, varied from any confirmation
thereof.  The Borrower shall indemnify
each Agent-Related Person and each Lender from all losses, costs, expenses and
liabilities resulting from the good faith reliance by such Person on each
notice purportedly given by or on behalf of the Borrower.  All telephonic notices to and other
communications with the Administrative Agent may be recorded by the
Administrative Agent and each of the parties hereto hereby consents to such
recording.

 

10.03      No Waiver; Cumulative Remedies.  No failure by any Lender or the
Administrative Agent to exercise, and no delay by any such Person in
exercising, any right, remedy, power or privilege hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder preclude any other or further exercise thereof or
the exercise of any other right, remedy, power or privilege.  The rights, remedies, powers and privileges
herein or therein provided are cumulative and not exclusive of any rights,
remedies, powers and privileges provided by law.

 

10.04      Attorney Costs, Expenses and Taxes.  Except as otherwise provided in Section 6.10,
the Borrower agrees (a) to pay or reimburse the Administrative Agent for
all reasonable and documented costs and expenses incurred in connection with
the development, preparation, negotiation and execution of this Agreement and
the other Loan Documents and any amendment, waiver, consent or other modification
of the provisions hereof and thereof (whether or not the transactions
contemplated hereby or thereby are consummated), and the consummation and
administration of the transactions contemplated hereby and thereby, including
all reasonable and documented Attorney Costs and (b) to pay or reimburse
the Administrative Agent or each Lender for all costs and expenses incurred in
connection with the enforcement, attempted enforcement, or preservation of any
rights or remedies under this Agreement or the other Loan Documents (including
all such costs and expenses incurred during any “workout” or restructuring in
respect of the Obligations and during any legal proceeding, including any
proceeding under any Debtor Relief Law), including all Attorney Costs.  The foregoing costs and expenses shall
include all search, filing, recording, title insurance and appraisal charges
and fees and taxes related thereto, and other reasonable and documented
out-of-pocket expenses incurred by the Administrative Agent and the reasonable
and documented cost of independent public accountants and other outside experts
retained by the Administrative Agent or any Lender.  The agreements in this Section 10.04
shall survive the termination of the Commitments and repayment of all other
Obligations.

 

10.05      Indemnification by the Borrower.  The Borrower shall indemnify and hold
harmless the Administrative Agent and each Lender and their respective
directors, officers, employees, counsel, agents and attorneys-in-fact
(collectively, the “Indemnitees”) from and against any and all
liabilities, obligations, losses, damages, penalties, claims, demands, actions,
judgments, suits, costs, expenses and disbursements (including Attorney Costs
limited to expenses of one lead counsel firm and one local counsel firm) of any
kind or nature whatsoever which may at any time be imposed on, incurred by or
asserted against any such Indemnitee in any way relating to or arising out of
or in connection with (a) the execution, delivery, enforcement,
performance or administration of any Loan Document or any other agreement,
letter or instrument delivered in connection with the transactions contemplated
thereby or the

 

68

 

consummation of the
transactions contemplated thereby, (b) any Commitment or Loan or the use
or proposed use of the proceeds therefrom, or (c) any actual or alleged
presence or release of Hazardous Materials on or from any property currently or
formerly owned or operated by the Borrower, or any Environmental Liability
related in any way to the Borrower, or (d) any actual or prospective
claim, litigation, investigation or proceeding relating to any of the
foregoing, whether based on contract, tort or any other theory (including any
investigation of, preparation for, or defense of any pending or threatened
claim, investigation, litigation or proceeding) and regardless of whether any
Indemnitee is a party thereto (all the foregoing, collectively, the “Indemnified
Liabilities”); provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such liabilities, obligations,
losses, damages, penalties, claims, demands, actions, judgments, suits, costs,
expenses or disbursements (including Attorney Costs) resulted from the gross
negligence or willful misconduct of such Indemnitee.  The agreements in this Section 10.05
shall survive the resignation of the Administrative Agent, the replacement of
any Lender, the termination of the Commitments and the repayment, satisfaction
or discharge of all the other Obligations. 
All amounts due under this Section 10.05 shall be payable
within ten Business Days after demand therefor.

 

10.06      Payments Set Aside.  To the extent that any payment by or on
behalf of the Borrower is made to the Administrative Agent or any Lender, or
the Administrative Agent or any Lender exercises its right of set-off, and such
payment or the proceeds of such set-off or any part thereof is subsequently
invalidated, declared to be fraudulent or preferential, set aside or required (including
pursuant to any settlement entered into by the Administrative Agent or such
Lender in its discretion) to be repaid to a trustee, receiver or any other
party, in connection with any proceeding under any Debtor Relief Law or
otherwise, then (a) to the extent of such recovery, the obligation or part
thereof originally intended to be satisfied shall be revived and continued in
full force and effect as if such payment had not been made or such set-off had
not occurred, and (b) each Lender severally agrees to pay to the
Administrative Agent upon demand its applicable share of any amount so
recovered from or paid by the Administrative Agent, plus interest
thereon from the date of such demand to the date such payment is made at a rate
per annum equal to the Federal Funds Rate from time to time in effect, in the
applicable currency of such recovery or payment.

 

10.07      Successors
and Assigns; Lender Assignment.

 

(a)           The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted
hereby, except that the Borrower may not assign or otherwise transfer any of
its rights or obligations hereunder without the prior written consent of each
Lender (and any attempted assignment or transfer by the Borrower without such
consent shall be null and void).  Nothing
in this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and assigns
permitted hereby, Participants to the extent provided in subsection (d) below
and, to the extent expressly contemplated hereby, the Indemnitees) any legal or
equitable right, remedy or claim under or by reason of this Agreement.

 

(b)           Any Lender
may at any time assign to one or more Eligible Assignees all or a portion of
its rights and obligations under this Agreement (including all or a portion of
its Commitment and the Loans at the time owing to it); provided that (i)
except in the case of an

 

69

 

assignment
of the entire remaining amount of the assigning Lender’s Commitment and the
Loans at the time owing to it or in the case of an assignment to a Lender or an
Affiliate of a Lender or an Approved Fund with respect to a Lender, the
aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) subject to each such assignment, determined as of the
date the Assignment and Assumption with respect to such assignment is delivered
to the Administrative Agent shall not be less than $5,000,000 in the case of
any assignment of a Commitment unless each of the Administrative Agent and, so
long as no Event of Default has occurred and is continuing, the Borrower
otherwise consents (each such consent not to be unreasonably withheld or
delayed), (ii) each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender’s rights and obligations under
this Agreement with respect to the Loans or the Commitment assigned, and (iii) the
parties to each assignment shall execute and deliver to the Administrative
Agent an Assignment and Assumption, together with a processing and recordation
fee of $3,500.  Subject to acceptance and
recording thereof by the Administrative Agent pursuant to subsection (c) below,
from and after the effective date specified in each Assignment and Assumption,
the Eligible Assignee thereunder shall be a party to this Agreement and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this
Agreement (and, in the case of an Assignment and Assumption covering all of the
assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 3.01, 3.04, 3.05, and 10.05
with respect to facts and circumstances occurring prior to the effective date
of such assignment).  Upon request, the
Borrower (at its expense) shall execute and deliver new or replacement Notes to
the assigning Lender and the assignee Lender. 
Any assignment or transfer by a Lender of rights or obligations under
this Agreement that does not comply with this subsection shall be treated for
purposes of this Agreement as a sale by such Lender of a Participation (as
defined in subsection (d) below) in such rights and obligations
in accordance with subsection (d) below.  The assignee shall, on or prior to the date
on which the assignment is made, deliver to the Borrower and to the
Administrative Agent the appropriate IRS form as prescribed by Section 3.01(e) of
this Agreement.  If an Assignment of all
or a portion of a Lender’s rights and obligations under this Agreement would
result (under the terms of Section 3.01) in any payment by the
Borrower of additional sums, notwithstanding Section 3.01 or any
other provision set forth in this Agreement, the Borrower shall not be
obligated to pay such additional sums.

 

(c)           The
Administrative Agent, acting solely for this purpose as an agent of the
Borrower, shall maintain at the Administrative Agent’s Office a copy of each
Assignment and Assumption delivered to it and a register for the recordation of
the names and addresses of the Lenders, and the Commitments of, and principal
amounts of the Loans owing to, each Lender pursuant to the terms hereof from
time to time (the “Register”). 
The entries in the Register shall be conclusive absent manifest error,
and the Borrower, the Administrative Agent and the Lenders may treat each
Person whose name is recorded in the Register pursuant to the terms hereof as a
Lender hereunder for all purposes of this Agreement, notwithstanding notice to
the contrary.  The Register shall be
available for inspection by the Borrower and any Lender, at any reasonable time
and from time to time upon reasonable prior notice.

 

70

 

(d)                                 Any Lender may at any time, without the consent of, or notice
to, the Borrower or the Administrative Agent, sell participations to any Person
(other than a natural person or the Borrower or any of the Borrower’s
Affiliates or Subsidiaries) (each, a “Participant”) in all or a portion
of such Lender’s rights and/or obligations under this Agreement (including all
or a portion of its Commitment and/or the Loans owing to it) (a “Participation”);
provided that (i) such Lender’s obligations under this Agreement
shall remain unchanged, (ii) such Lender shall remain solely responsible
to the other parties hereto for the performance of such obligations, (iii) the
Borrower, the Administrative Agent and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender’s rights
and obligations under this Agreement, and (iv) the Participant shall have
no rights against the Borrower or any of its Subsidiaries or the Administrative
Agent, and the Borrower and the Administrative Agent need give notices to and
deal only with such Lender and shall have no obligation to any
Participant.  Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such Lender
shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not,
without the consent of the Participant, agree to any amendment, waiver or other
modification that would (i) postpone any date upon which any payment of
money is scheduled to be paid to such Participant, (ii) reduce the
principal, interest, fees or other amounts payable to such Participant, (iii) release
any Guarantor from any Guaranty Agreement, or (iv) release all or
substantially all of the Collateral. 
Subject to subsection (e) below, the Borrower agrees
that each Participant shall be entitled to the benefits of Sections 3.01,
3.04 and 3.05 to the same extent as if it were a Lender (provided
it complies in fact with all the obligations of, and requirements imposed on,
Lenders thereunder to the same extent as were it a Lender) and had acquired its
interest by assignment pursuant to subsection (b) above.  To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 10.09
as though it were a Lender, provided such Participant agrees to be
subject to Section 2.08 as though it were a Lender.

 

(e)                                  Notwithstanding any other provision set forth in this
Agreement, a Participant shall not be entitled to receive any greater payment
under the Agreement than the applicable Lender would have been entitled to
receive with respect to the Participation sold to such Participant.

 

(f)                                    Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement (including
under its Notes, if any) to secure obligations of such Lender, including any
pledge or assignment to secure obligations, to a Federal Reserve Bank; provided
that no such pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such
Lender as a party hereto.

 

(g)                                 If the consent of the Borrower to an assignment or to an Eligible
Assignee is required hereunder (including a consent to an assignment which does
not meet the minimum assignment threshold specified in clause (i) of
the proviso to the first sentence of Section 10.07(b)), the
Borrower shall be deemed to have given its consent five Business Days after the
date notice thereof has been delivered by the assigning Lender (through the
Administrative Agent) unless such consent is expressly refused by the Borrower
prior to such fifth Business Day.

 

71

 

(h)                                 As used herein, the following terms have the following
meanings:

 

“Eligible Assignee” means (a) a Lender; (b) an
Affiliate of a Lender; (c) an Approved Fund; and (d) any other Person
(other than a natural person) that is a financial institution approved by (i) the
Administrative Agent and, (ii) unless (A) such Person is taking
delivery of an assignment in connection with physical settlement of a credit
derivative transaction or (B) an Event of Default has occurred and is continuing,
the Borrower (each such approval referred to in clauses (i) through (ii) not
to be unreasonably withheld or delayed); provided that notwithstanding
the foregoing, “Eligible Assignee” shall not include the Borrower or any
of the Borrower’s Subsidiaries.

 

“Fund” means any Person (other than a natural
person) that is (or will be) engaged in making, purchasing, holding or
otherwise investing in commercial loans and similar extensions of credit in the
ordinary course of its business.

 

“Approved Fund” means any Fund that is
administered or managed by (a) a Lender, (b) an Affiliate of a Lender
or (c) an entity or an Affiliate of an entity that administers or manages a
Lender.

 

10.08                 Confidentiality.  Each of the Administrative Agent and the
Lenders agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (a) to its and its
Affiliates’ directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential); (b) to
the extent requested by any regulatory authority; (c) to the extent required
by applicable laws or regulations or by any subpoena or similar legal process; (d) to
any other party to this Agreement; (e) in connection with the exercise of
any remedies hereunder or any suit, action or proceeding relating to this
Agreement or the enforcement of rights hereunder; (f) subject to an
agreement containing provisions substantially the same as those of this Section 10.08,
to (i) any Eligible Assignee of or Participant in, or any prospective
Eligible Assignee of or Participant in, any of its rights or obligations under
this Agreement or (ii) any direct or indirect contractual counterparty or
prospective counterparty (or such contractual counterparty’s or prospective
counterparty’s professional advisor) to any credit derivative transaction relating
to obligations of the Borrower; (g) with the consent of the Borrower; (h) to
the extent such Information (i) becomes publicly available other than as a
result of a breach of this Section 10.08 or (ii) becomes
available to the Administrative Agent or any Lender on a nonconfidential basis
from a source other than the Borrower; or (i) to the National Association
of Insurance Commissioners or any other similar organization or any nationally
recognized rating agency that requires access to information about a Lender’s
or its Affiliates’ investment portfolio in connection with ratings issued with
respect to such Lender or its Affiliates. 
In addition, the Administrative Agent and the Lenders may disclose the
existence of this Agreement and information about this Agreement to market data
collectors, similar service providers to the lending industry, and service
providers to the Administrative Agent and the Lenders in connection with the
administration and management of this Agreement, the other Loan Documents, the
Commitments, and the Loans.  For the
purposes of this Section 10.08, “Information” means all
information received from the Borrower relating to the Borrower or its

 

72

 

business, other than any
such information that is available to the Administrative Agent or any Lender on
a nonconfidential basis prior to disclosure by the Borrower.

 

10.09                 Set-off.  In addition to any rights and remedies of the
Lenders provided by law, upon the occurrence and during the continuance of any
Event of Default, each Lender is authorized at any time and from time to time,
without prior notice to the Borrower, any such notice being waived by the
Borrower to the fullest extent permitted by law, to set off and apply any and
all deposits (general or special, time or demand, provisional or final) at any
time held by, and other indebtedness at any time owing by, such Lender to or
for the credit or the account of the Borrower against any and all Obligations
becoming due and payable hereunder (whether at the stated maturity thereof, by
acceleration, or otherwise), now or hereafter existing, irrespective of whether
or not the Administrative Agent or such Lender shall have made demand under
this Agreement or any other Loan Document. 
Each Lender agrees promptly to notify the Borrower and the
Administrative Agent, after any such set-off and application made by such
Lender; provided, however, that the failure to give such
notice shall not affect the validity of such set-off and application

 

10.10                 Interest
Rate Limitation. 
Notwithstanding anything to the contrary contained in any Loan Document,
the interest paid or agreed to be paid under the Loan Documents shall not
exceed the maximum rate of non-usurious interest permitted by applicable Law (the
“Maximum Rate”).  If the
Administrative Agent or any Lender shall receive interest in an amount that
exceeds the Maximum Rate, the excess interest shall be applied to the principal
of the Loans or, if it exceeds such unpaid principal, refunded to the Borrower.  In determining whether the interest
contracted for, charged, or received by the Administrative Agent or a Lender
exceeds the Maximum Rate, such Person may, to the extent permitted by
applicable Law, (a) characterize any payment that is not principal as an
expense, fee, or premium rather than interest, (b) exclude voluntary
prepayments and the effects thereof, and (c) amortize, prorate, allocate,
and spread in equal or unequal parts the total amount of interest throughout
the contemplated term of the Obligations.

 

10.11                 Counterparts.  This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

 

10.12                 Integration.  This Agreement, together with the other Loan
Documents, comprises the complete, final and integrated agreement of the
parties on the subject matter hereof and thereof and supersedes all prior
agreements, written or oral, on such subject matter.  This Agreement, the other Loan Documents and
any separate letter agreement with respect to fees payable to the
Administrative Agent or the Arranger may not be contradicted by evidence of
prior, contemporaneous, or subsequent oral agreements of the parties, and there
are no unwritten oral agreements among the parties.  In the event of any conflict between the
provisions of this Agreement and those of any other Loan Document, the
provisions of this Agreement shall control; provided that the inclusion
of supplemental rights or remedies in favor of the Administrative Agent or the
Lenders in any other Loan Document shall not be deemed a conflict with this
Agreement.  Each Loan Document was
drafted with the joint participation of the respective parties thereto and
shall be construed neither against nor in favor of any party, but rather in
accordance with the fair meaning thereof.

 

73

 

10.13                 Survival
of Representations and Warranties.  All representations and warranties made
hereunder and in any other Loan Document or other document delivered pursuant
hereto or thereto or in connection herewith or therewith shall survive the
execution and delivery hereof and thereof. 
Such representations and warranties have been or will be relied upon by
the Administrative Agent and each Lender, regardless of any investigation made
by the Administrative Agent or any Lender or on their behalf and
notwithstanding that the Administrative Agent or any Lender may have had notice
or knowledge of any Default or Event of Default at the time of any Borrowing,
and shall continue in full force and effect as long as any Loan or any other
Obligation shall remain unpaid or unsatisfied.

 

10.14                 Severability.  Any provision of this Agreement and the other
Loan Documents to which the Borrower is a party that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions thereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

 

10.15                 USA
Patriot Act Notice.  The
Administrative Agent and each Lender hereby notifies the Borrower that,
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L.
107-56 (signed into law October 26, 2001)) (the “Patriot Act”), it
is required to obtain, verify and record information that identifies the
Borrower, which information includes the name and address of the Borrower and
other information that will allow Administrative Agent and each Lender to
identify the Borrower in accordance with the Patriot Act.

 

10.16                 No
Foreign Control.  THE
ADMINISTRATIVE AGENT AND LENDERS EXPRESSLY ACKNOWLEDGE AND AGREE THAT THE ADMINISTRATIVE
AGENT AND LENDERS SHALL HAVE NO RIGHTS UNDER THIS AGREEMENT OR ANY LOAN
DOCUMENT THAT WOULD, ALONE OR IN CONJUNCTION WITH OTHER SUCH RIGHTS, CONSTITUTE
“OWNERSHIP” OR “CONTROL” OF BORROWER BY A PERSON THAT IS NOT “A CITIZEN OF THE
UNITED STATES” WITHIN THE MEANING OF THE U.S. TRANSPORTATION CODE, AS AMENDED
FROM TIME TO TIME, AS RECODIFIED AT 49 U.S.C. § 40101 ET  SEQ.,
PROVIDED THAT THE FOREGOING SHALL NOT LIMIT THE RIGHTS OF ADMINISTRATIVE AGENT
AND LENDERS TO THE FULL RIGHTS AND REMEDIES OF LENDERS AND SECURED PARTIES
UNDER APPLICABLE LAW.

 

If any provision of this Agreement or any Loan
Document shall cause any of this Agreement or any of the Loan Documents, to be
classified as “control” of Borrower by a Person that is not a citizen of the
United States within the meaning of the U.S. Transportation Code, as amended
from time to time, recodified at 49 U.S.C. § 40101, et  seq.,
such provision, right or remedy shall be suspended and not enforced to the
extent, but only to the extent, and only so long as, required to avoid such
classification.  In the event a written
modification to this Agreement or any Loan Document is required to avoid “ownership”
or “control” of the Borrower by a Person that is not such a citizen of the
United States, by the U.S. Department of Transportation, the parties hereto
shall in good faith seek to mutually agree upon such written amendment hereto
or thereto, at the Borrower’s expense.

 

74

 

10.17                 Governing
Law.

 

(a)                                  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

(b)                                 ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF
NEW YORK SITTING IN NEW YORK CITY, NEW YORK COUNTY, NEW YORK OR OF THE UNITED
STATES FOR THE DISTRICT OF SUCH STATE, AND BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER CONSENTS, FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF
THOSE COURTS.  THE BORROWER, THE
ADMINISTRATIVE AGENT AND EACH LENDER IRREVOCABLY WAIVES ANY OBJECTION,
INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN
RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT RELATED THERETO.  THE BORROWER, THE ADMINISTRATIVE AGENT AND
EACH LENDER WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS,
WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.

 

10.18                 Waiver
of Right to Trial by Jury.  EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY
WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED
OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT
TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE,
WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR
TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL
WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT
TO TRIAL BY JURY.

 

10.19                 Forced
Place Insurance.

 

WARNING

 

Unless the Borrower provides the Administrative
Agent with evidence of insurance coverage as required by this Agreement, the
Administrative Agent may purchase insurance at the Borrower’s expense to
protect the Lenders’ interest.  This
insurance may, but need not, also protect the Borrower’s interest.  If the collateral becomes damaged, the
coverage the Administrative Agent purchases may not pay any claim the Borrower
makes or any claim made against the Borrower. 
The Borrower may later cancel this coverage by providing evidence that
the Borrower has obtained property coverage elsewhere.

 

75

 

The Borrower is responsible for the cost of any
insurance purchased by the Administrative Agent pursuant to this Section 10.19.  The cost of this insurance may be added to
the Loan balance.  If the cost is added
to the Borrower’s Loan balance, the interest rate on the Loan will apply to
this added amount.  The effective date of
coverage may be the date the Borrower’s prior coverage lapsed or the date the
Borrower failed to provide proof of coverage.

 

The coverage the Administrative Agent purchases may
be considerably more expensive than insurance the Borrower can obtain on its
own and may not satisfy any need for property damage coverage or any mandatory
liability insurance requirements imposed by applicable law.

 

10.20                 Time of
the Essence.  Time is of
the essence of the Loan Documents.

 

10.21                 Judgment
Currency.  If, for the
purposes of obtaining judgment in any court, it is necessary to convert a sum
due hereunder or any other Loan Document in one currency into another currency,
the rate of exchange used shall be that at which in accordance with normal
banking procedures the Administrative Agent could purchase the first currency
with such other currency on the Business Day preceding that on which final
judgment is given.  The obligation of the
Borrower in respect of any such sum due from it to the Administrative Agent or
the Lenders hereunder or under the other Loan Documents shall, notwithstanding
any judgment in a currency (the “Judgment Currency”) other than that in
which such sum is denominated in accordance with the applicable provisions of
this Agreement (the “Agreement Currency”), be discharged only to the
extent that on the Business Day following receipt by the Administrative Agent
of any sum adjudged to be so due in the Judgment Currency, the Administrative
Agent may in accordance with normal banking procedures purchase the Agreement
Currency with the Judgment Currency.  If the
amount of the Agreement Currency so purchased is less than the sum originally
due to the Administrative Agent from the Borrower in the Agreement Currency,
the Borrower agrees, as a separate obligation and notwithstanding any such
judgment, to indemnify the Administrative Agent and each Lender to whom such
obligation was owing against such loss. 
If the amount of the Agreement Currency so purchased is greater than the
sum originally due to the Administrative Agent or such Lender in such currency,
the Administrative Agent or such Lender, as appropriate, agrees to return the
amount of any excess paid to it to the Borrower (or to any other Person who may
be entitled thereto under applicable law).

 

[Signature page follows]

 

76

 

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

 

	
   

  	
  ERICKSON AIR-CRANE
  INCORPORATED

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By 

  	
  /s/ JAMES RILEY LOFTIN

  
	
   

  	
  Name:

  	
  James Riley Loftin

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
  Erickson Air-Crane
  Incorporated

  
	
   

  	
   

  	
   

  
	
   

  	
  D.B. ZWIRN SPECIAL
  OPPORTUNITIES FUND, L.P., as Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By 

  	
  /s/ LAWRENCE D. CUTLER

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BERNARD NATIONAL LOAN
  INVESTORS, LTD., as Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
  /s/ LAWRENCE D. CUTLER

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  STONEHOUSE ERICKSON
  INVESTMENT CO. LLC, as Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
  /s/ KIRK FERGUSON

  
	
   

  	
  Name:

  	
  Kirk Ferguson

  
	
   

  	
  Title:

  	
   

  

 

77

 

FIRST AMENDMENT TO SECOND LIEN AIRCRAFT AND FLIGHT EQUIPMENT SECURITY
AGREEMENT

 

THIS FIRST AMENDMENT TO SECOND LIEN AIRCRAFT AND
FLIGHT EQUIPMENT SECURITY AGREEMENT (“Amendment”) dated effective as of the
27th day of September, 2007, is made by and between D.B. ZWIRN
SEPCIAL OPPORTUNITIES FUND L.P., a Delaware limited
partnership, as second lien administrative agent (“Secured Party”) and ERICKSON AIR-CRANE INCORPORATED, a Delaware corporation (“Grantor”).

 

RECITALS

 

A.                                   Secured Party
and Grantor are parties to that certain Second Lien Credit Agreement dated as
of September 27, 2007 (the “Second Lien Credit Agreement”).

 

B.                                     Pursuant to the
Second Lien Credit Agreement, Grantor executed that certain Second Lien
Aircraft and Flight Equipment Security Agreement dated September 27, 2007,
filed with the Federal Aviation Administration on September 28, 2007, as
microfilm number 2324, but which has not yet been recorded (the “Security
Agreement”).

 

C.                                     Grantor and
Secured Party desire to amend the Security Agreement to add additional aircraft
engines.

 

NOW, THEREFORE, in consideration of the mutually
agreed terms and conditions set forth herein, the parties agree as follows:

 

AGREEMENT

 

1.                                      Ratification and Incorporation of
Security Agreement.  Except as expressly waived or modified under
this Agreement, the parties hereto acknowledge, confirm and ratify all of the
terms and conditions of the Security Agreement. 
Unless otherwise defined herein, capitalized terms shall have the same
meaning as those terms are defined in the Security Agreement.

 

2.                                      Amendments to Security Agreement. 
The Security Agreement is hereby amended to add the following additional
aircraft engines:

 

Airsearch
model TPE331-10N-534S

Serial
Numbers:  P-77195C and P-77186C.

(more
than 550 rated takeoff shaft horsepower or the equivalent thereof)

 

Lycoming
model T53-L-13B

Serial
Number:  LE-17459BR

(more
than 550 rated takeoff shaft horsepower or the equivalent thereof)

 

Allison model 250-C20B

Serial No. CAE823517

 

 

(less
than 550 rated takeoff shaft horsepower or the equivalent thereof)

 

3.                                      Miscellaneous.

 

3.1                               Entire Agreement. 
This Amendment, together with the Security Agreement and the Loan
Documents, is the entire agreement between Secured Party on the one hand and
Grantor on the other hand with respect to the subject matter hereof.  This Amendment supersedes all prior and
contemporaneous oral and written agreements and discussions with respect to the
subject matter hereof.  Except as
otherwise expressly modified in this Amendment, the Security Agreement remains
in full force and effect.

 

3.2                               Counterparts. 
This Amendment may be executed in one or more identical counterparts,
each of which shall be an original, but all of which shall constitute one and
the same agreement.  Delivery of an
executed counterpart of a signature page to this Amendment by facsimile
transmission shall be effective as delivery of a manually executed counterpart.

 

3.3                               Headings.  Section headings
used herein are for convenience of reference only, are not part of this
Amendment, and are not to be taken into consideration in interpreting this
Amendment.

 

3.4                               Recitals. 
The recitals set forth at the beginning of this Amendment are true and
correct, and such recitals are incorporated into and are made a part of this
Amendment.

 

3.5                               Governing Law. 
This Amendment shall be governed by, and construed in accordance with,
the laws of the State of New York.

 

3.6                               Conflicting Terms. 
In the event of any inconsistency between the provisions of this
Amendment and any provision of the Security Agreement or any other Loan
Document, the terms of this Amendment shall govern and control.

 

[SIGNATURE PAGE FOLLOWS]

 

2

 

IN WITNESS WHEREOF, this First Amendment to Security
Agreement is executed and delivered by the duly authorized officers of the parties
hereto effective as of the day and date first written above.

 

	
   

  	
  GRANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
  ERICKSON
  AIR-CRANE INCORPORATED

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  JAMES RILEY LOFTIN

  
	
   

  	
  Name:

  	
  James
  Riley Loftin

  
	
   

  	
  Title:

  	
  Chief
  Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SECURED
  PARTY:

  
	
   

  	
   

  	
   

  
	
   

  	
  D.B.
  ZWIRN SPECIAL OPPORTUNITIES FUND L.P., as Second Lien
  Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

3

 

Execution Version

 

FIRST
AMENDMENT

TO
SECOND LIEN CREDIT AGREEMENT

 

This FIRST AMENDMENT TO
SECOND LIEN CREDIT AGREEMENT (this “Amendment”), dated as of July [17], 2008, is entered into by and among
ERICKSON AIR-CRANE INCORPORATED, a Delaware corporation (the “Borrower”),
and the lenders party to the Second Lien Credit Agreement referenced below (the
“Lenders”) and is acknowledged by D.B. ZWIRN SPECIAL OPPORTUNITIES FUND,
L.P., as Administrative Agent (“Administrative Agent”).

 

RECITALS

 

WHEREAS, reference is made
to that certain Second Lien Credit Agreement, dated as of September 27,
2007 (as amended through the date hereof, the “Second Lien Credit Agreement”),
by and among the Borrower, the Lenders and the Administrative Agent.
Capitalized terms used herein without definition shall have the same meanings
herein as set forth in the Second Lien Credit Agreement after giving effect to
this Amendment.

 

WHEREAS, the Lenders have
requested that the Borrower agree to amend certain provisions of the Second
Lien Credit Agreement as provided for herein; and

 

WHEREAS, subject to certain
conditions, the Borrower is willing to agree to such amendment relating to the
Second Lien Credit Agreement.

 

NOW, THEREFORE, in
consideration of the premises and the agreements, provisions and covenants
herein contained, the parties hereto agree as follows:

 

SECTION I.                                 AMENDMENTS TO
CREDIT AGREEMENT

 

1.1                                Amendments to
Article I: Definitions and Accounting Terms.

 

A.             Section 1.1 of the
Second Lien Credit Agreement is hereby amended by adding the following
definitions in proper alphabetical sequence:

 

“First
Amendment” means that certain First Amendment Agreement to Second Lien
Second Lien Credit Agreement dated as of July [    ],
2008 among the Borrower, the Administrative Agent and the financial
institutions listed on the signature pages thereto.

 

“First
Amendment Effective Date” means the date of satisfaction of the conditions
referred to in Section II of the First Amendment.

 

B.               The definition of the term “Required
Lenders” appearing in Section 1.1 of the Second Lien Credit Agreement is
hereby amended to read in its entirety:

 

“Required
Lenders” means, as of any date of determination, Lenders whose Voting
Percentages aggregate equal to or more than 50%.

 

 

SECTION II.                          CONDITIONS TO
EFFECTIVENESS

 

This Amendment shall become
effective as of the date hereof only upon receipt by the Administrative Agent
of a counterpart signature page of this Amendment duly executed by the
Borrower and each Lender.

 

SECTION III.                       REPRESENTATIONS
AND WARRANTIES

 

The Borrower represents and
warrants to each Lender, in all material respects, that the representations and
warranties contained in Section V of the Second Lien Credit Agreement as
amended by this Amendment (the “Amended Agreement”) are and will be true
and correct in all material respects on and as of the First Amendment Effective
Date to the same extent as though made on and as of that date, except to the
extent such representations and warranties specifically relate to an earlier
date, in which case they were true and correct in all material respects on and
as of such earlier date.

 

SECTION IV.                        MISCELLANEOUS

 

A.              Reference to and Effect on
the Second Lien Credit Agreement and the Other Loan Documents.

 

(i)                       On and after
the First Amendment Effective Date, each reference in the Second Lien Credit
Agreement to “this Amendment”, “hereunder”, “hereof, “herein” or words of like
import referring to the Second Lien Credit Agreement, and each reference in the
other Loan Documents to the “Second Lien Credit Agreement”, “thereunder”, “thereof”
or words of like import referring to the Second Lien Credit Agreement shall
mean and be a reference to the Second Lien Credit Agreement as amended by this
Amendment.

 

(ii)                    Except as specifically
amended by this Amendment, the Second Lien Credit Agreement and the other Loan
Documents shall remain in full force and effect and are hereby ratified and
confirmed.

 

(iii)                 The execution, delivery and
performance of this Amendment shall not constitute a waiver of any provision
of, or operate as a waiver of any right, power or remedy of the Administrative
Agent or any Lender under, the Second Lien Credit Agreement or any of the other
Loan Documents.

 

B.                Headings.  Section and Subsection headings in this
Amendment are included herein for convenience of reference only and shall not
constitute a part of this Amendment for any other purpose or be given any
substantive effect.

 

C.                Applicable Law.    THIS AMENDMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.

 

2

 

D.               Counterparts.   This Amendment may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed and delivered shall be deemed an original, but all
such counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and
attached to a single counterpart so that all signature pages are
physically attached to the same document.

 

[Remainder of
this page intentionally left blank.]

 

3

 

IN WITNESS WHEREOF, the
parties hereto have caused this Amendment to be duly executed and delivered by
their respective officers thereunto duly authorized as of the date first
written above.

 

 

	
   

  	
  ERICKSON AIR-CRANE
  INCORPORATED,

  
	
   

  	
  a
  Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James Riley Loftin

  
	
   

  	
   

  	
  Name:

  	
  James
  Riley Loftin

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer
 Erickson Air-Crane Incorporated

  

 

 

	
   

  	
  ZM PRIVATE EQUITY FUND II,
  L.P.,

  as Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Quinn Morgan

  
	
   

  	
   

  	
  Name:

  	
  QUINN MORGAN

  
	
   

  	
   

  	
  Title:

  	
  AUTHORIZED SIGNATORY

  

 

[First Amendment to Second Lien Credit Agreement]

 

 

	
   

  	
  STONEHOUSE ERICKSON
  INVESTMENT CO. LLC,

  
	
   

  	
  as Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kirk Ferguson

  
	
   

  	
   

  	
  Name:

  	
  Kirk Ferguson

  
	
   

  	
   

  	
  Title:

  	
   

  

 

[First Amendment
to Second Lien Credit Agreement]

 

 

	
   

  	
  BERNARD NATIONAL LOAN
  INVESTORS, LTD.,

  as Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lawrence D. Cutler 

  
	
   

  	
   

  	
  Name:

  	
  LAWRENCE D. CUTLER 

  
	
   

  	
   

  	
  Title:

  	
  AUTHORIZED SIGNATORY

  

 

[First Amendment
to Second Lien Credit Agreement]

 

 

	
  Acknowledged:

  	
   

  
	
   

  	
   

  
	
  D.B. ZWIRN SPECIAL
  OPPORTUNITIES FUND, L.P,

  as Administrative Agent

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Lawrence D. Cutler

  	
   

  
	
   

  	
  Name:

  	
  LAWRENCE D. CUTLER

  	
   

  
	
   

  	
  Title:

  	
  AUTHORIZED SIGNATORY

  	
   

  

 

[First Amendment
to Second Lien Credit Agreement]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00175-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00175-of-00352.parquet"}]]