Document:

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                                                                    EXHIBIT 10.1

                                                                  EXECUTION COPY

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                            STEWART & STEVENSON LLC,
                           STEWART & STEVENSON CORP.,

                    THE SUBSIDIARY GUARANTORS PARTIES HERETO

                                       AND

                     WELLS FARGO BANK, NATIONAL ASSOCIATION,
                                   AS TRUSTEE

                            10% Senior Notes due 2014

                                   ----------

                                    INDENTURE

                            Dated as of July 6, 2006

                                   ----------

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                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                            PAGE
                                                                            ----
<S>                                                                         <C>
                                    ARTICLE I
                   DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1. Definitions.................................................      1
SECTION 1.2. Other Definitions...........................................     32
SECTION 1.3. Incorporation by Reference of Trust Indenture Act...........     33
SECTION 1.4. Rules of Construction.......................................     34

                                   ARTICLE II
                                 THE SECURITIES
SECTION 2.1. Form, Dating and Terms......................................     35
SECTION 2.2. Execution and Authentication................................     42
SECTION 2.3. Registrar and Paying Agent..................................     44
SECTION 2.4. Paying Agent to Hold Money in Trust.........................     44
SECTION 2.5. Securityholder Lists........................................     45
SECTION 2.6. Transfer and Exchange.......................................     45
SECTION 2.7. Form of Certificate to be Delivered in Connection with
                Transfers to IAIs........................................     48
SECTION 2.8. Form of Certificate to be Delivered in Connection with
                Transfers Pursuant to Regulation S.......................     50
SECTION 2.9. Mutilated, Destroyed, Lost or Stolen Securities.............     51
SECTION 2.10. Outstanding Securities.....................................     52
SECTION 2.11. Temporary Securities.......................................     53
SECTION 2.12. Cancellation...............................................     53
SECTION 2.13. Payment of Interest; Defaulted Interest....................     54
SECTION 2.14. Computation of Interest....................................     55
SECTION 2.15. CUSIP, Common Code and ISIN Numbers........................     55

                                   ARTICLE III
                                    COVENANTS
SECTION 3.1. Payment of Securities.......................................     55
SECTION 3.2. Limitation on Indebtedness..................................     56
SECTION 3.3. Limitation on Restricted Payments...........................     61
SECTION 3.4. Limitation on Liens.........................................     67
SECTION 3.5. Limitation on Sale/Leaseback Transactions...................     67
SECTION 3.6. Limitation on Restrictions on Distributions from Restricted
                Subsidiaries.............................................     67
SECTION 3.7. Limitation on Sales of Assets and Subsidiary Stock..........     70
SECTION 3.8. Limitation on Affiliate Transactions........................     73
SECTION 3.9. Change of Control...........................................     75
SECTION 3.10. SEC Reports................................................     77
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                                       ii

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<TABLE>
<S>                                                                         <C>
SECTION 3.11. Future Subsidiary Guarantors...............................     77
SECTION 3.12. Maintenance of Office or Agency............................     78
SECTION 3.13. Corporate Existence........................................     78
SECTION 3.14. Payment of Taxes and Other Claims..........................     78
SECTION 3.15. Payments for Consent.......................................     79
SECTION 3.16. Compliance Certificate.....................................     79
SECTION 3.17. Further Instruments and Acts...............................     79
SECTION 3.18. Limitation on Lines of Business............................     79
SECTION 3.19. Statement by Officers as to Default........................     79
SECTION 3.20. Restrictions on Activities.................................     79

                                   ARTICLE IV
                                SUCCESSOR COMPANY
SECTION 4.1. Merger and Consolidation....................................     80

                                    ARTICLE V
                            REDEMPTION OF SECURITIES
SECTION 5.1. Redemption..................................................     82
SECTION 5.2. Applicability of Article....................................     82
SECTION 5.3. Election to Redeem; Notice to Trustee.......................     82
SECTION 5.4. Selection by Trustee of Securities to Be Redeemed...........     82
SECTION 5.5. Notice of Redemption........................................     83
SECTION 5.6. Deposit of Redemption Price.................................     84
SECTION 5.7. Securities Payable on Redemption Date.......................     84
SECTION 5.8. Securities Redeemed in Part.................................     84

                                   ARTICLE VI
                              DEFAULTS AND REMEDIES
SECTION 6.1. Events of Default...........................................     85
SECTION 6.2. Acceleration................................................     87
SECTION 6.3. Other Remedies..............................................     87
SECTION 6.4. Waiver of Past Defaults.....................................     88
SECTION 6.5. Control by Majority.........................................     88
SECTION 6.6. Limitation on Suits.........................................     88
SECTION 6.7. Rights of Holders to Receive Payment........................     88
SECTION 6.8. Collection Suit by Trustee..................................     89
SECTION 6.9. Trustee May File Proofs of Claim............................     89
SECTION 6.10. Priorities.................................................     89
SECTION 6.11. Undertaking for Costs......................................     89

                                   ARTICLE VII
                                     TRUSTEE
SECTION 7.1. Duties of Trustee...........................................     90
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                                       iii

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<TABLE>
<S>                                                                         <C>
SECTION 7.2. Rights of Trustee...........................................     91
SECTION 7.3. Individual Rights of Trustee................................     92
SECTION 7.4. Trustee's Disclaimer........................................     92
SECTION 7.5. Notice of Defaults..........................................     92
SECTION 7.6. Reports by Trustee to Holders...............................     92
SECTION 7.7. Compensation and Indemnity..................................     93
SECTION 7.8. Replacement of Trustee......................................     94
SECTION 7.9. Successor Trustee by Merger.................................     94
SECTION 7.10. Eligibility; Disqualification..............................     95
SECTION 7.11. Preferential Collection of Claims Against the Issuers......     95
SECTION 7.12. Trustee's Application for Instruction from the Issuers.....     95
SECTION 7.13. Paying Agents..............................................     95

                                  ARTICLE VIII
                       DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.1. Discharge of Liability on Securities; Defeasance............     96
SECTION 8.2. Conditions to Defeasance....................................     97
SECTION 8.3. Application of Trust Money..................................     99
SECTION 8.4. Repayment to the Issuers....................................     99
SECTION 8.5. Indemnity for U.S. Government Obligations...................     99
SECTION 8.6. Reinstatement...............................................     99

                                   ARTICLE IX
                                   AMENDMENTS
SECTION 9.1. Without Consent of Holders..................................    100
SECTION 9.2. With Consent of Holders.....................................    101
SECTION 9.3. Compliance with Trust Indenture Act.........................    102
SECTION 9.4. Revocation and Effect of Consents and Waivers...............    102
SECTION 9.5. Notation on or Exchange of Securities.......................    102
SECTION 9.6. Trustee To Sign Amendments..................................    103

                                    ARTICLE X
                              SECURITIES GUARANTEE
SECTION 10.1. Subsidiary Guarantee.......................................    103
SECTION 10.2. Limitation on Liability; Termination, Release and
                Discharge................................................    105
SECTION 10.3. Right of Contribution......................................    106
SECTION 10.4. No Subrogation.............................................    106

                                   ARTICLE XI
                                  MISCELLANEOUS
SECTION 11.1. Trust Indenture Act Controls...............................    107
SECTION 11.2. Notices....................................................    107
SECTION 11.3. Communication by Holders with other Holders................    108
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                                       iv

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<TABLE>
<S>                                                                         <C>
SECTION 11.4. Certificate and Opinion as to Conditions Precedent.........    108
SECTION 11.5. Statements Required in Certificate or Opinion..............    108
SECTION 11.6. When Securities Disregarded................................    109
SECTION 11.7. Rules by Trustee, Paying Agent and Registrar...............    109
SECTION 11.8. Legal Holidays.............................................    109
SECTION 11.9. GOVERNING LAW..............................................    109
SECTION 11.10. No Recourse Against Others................................    109
SECTION 11.11. Successors................................................    109
SECTION 11.12. Multiple Originals........................................    110
SECTION 11.13. Qualification of Indenture................................    110
SECTION 11.14. Table of Contents; Headings...............................    110
</TABLE>

EXHIBIT A Form of the Note
EXHIBIT B Form of Indenture Supplement to Add Subsidiary Guarantors

                                        v

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                              CROSS-REFERENCE TABLE

<TABLE>
<CAPTION>
TIA                                                                Indenture
Section                                                             Section
-------                                                         ----------------
<S>                                                             <C>
310(a)(1)             .......................................   7.10
   (a)(2)             .......................................   7.10
   (a)(3)             .......................................   N.A.
   (a)(4)             .......................................   N.A.
   (a)(5)             .......................................   7.10
   (b)                .......................................   7.3; 7.8; 7.10
   (c)                .......................................   N.A.
311(a)                .......................................   7.11
   (b)                .......................................   7.11
   (c)                .......................................   N.A.
312(a)                .......................................   2.5
   (b)                .......................................   11.3
   (c)                .......................................   11.3
313(a)                .......................................   7.6
   (b)(1)             .......................................   N.A.
   (b)(2)             .......................................   7.6
   (c)                .......................................   7.6
   (d)                .......................................   7.6
314(a)                .......................................   3.10; 3.16; 11.5
   (b)                .......................................   N.A.
   (c)(1)             .......................................   11.4
   (c)(2)             .......................................   11.4
   (c)(3)             .......................................   N.A.
   (d)                .......................................   N.A.
   (e)                .......................................   11.5
315(a)                .......................................   7.1
   (b)                .......................................   7.5; 11.2
   (c)                .......................................   7.1
   (d)                .......................................   7.1
   (e)                .......................................   6.11
316(a)(last sentence) .......................................   11.6
   (a)(1)(A)          .......................................   6.5
   (a)(1)(B)          .......................................   6.4
   (a)(2)             .......................................   N.A.
   (b)                .......................................   N.A.
   (c)                .......................................   6.5
317(a)(1)             .......................................   6.8
   (a)(2)             .......................................   6.9
   (b)                .......................................   2.4
318(a)                .......................................   11.1
</TABLE>

     N.A. means Not Applicable.

                                       vi

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Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
part of this Indenture.

                                       vii
<PAGE>

          INDENTURE dated as of July 6, 2006, among STEWART & STEVENSON LLC, a
Delaware limited liability company (the "Company"), STEWART & STEVENSON CORP., a
Delaware corporation (together with the Company, the "Issuers"), THE SUBSIDIARY
GUARANTORS (as defined herein) and Wells Fargo Bank, National Association,
national banking association (the "Trustee"), as Trustee.

          For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, each party hereto covenants and agrees as
follows for the benefit of the other parties and for the equal and ratable
benefit of all Holders of (i) the Issuers' 10% Senior Notes due 2014 issued on
the date hereof and the guarantees thereof by certain of the Issuers'
subsidiaries (the "Initial Securities"), (ii) if and when issued, an unlimited
principal amount of additional 10% Senior Notes due 2014 in a non-registered
offering or 10% Senior Notes due 2014 in a registered offering of the Issuers
and the guarantees thereof by certain of the Issuers' subsidiaries that may be
offered from time to time subsequent to the Issue Date (the "Additional
Securities") and (iii) if and when issued, the Additional Securities and the
guarantees thereof by certain of the Issuers' subsidiaries that may be issued
from time to time in exchange for Initial Securities or any Additional
Securities in an offer registered under the Securities Act as provided in a
Registration Rights Agreement (as hereinafter defined) (the "Exchange
Securities," and together with the Initial Securities and Additional Securities,
the "Securities").

                                    ARTICLE I

                          DEFINITIONS AND INCORPORATION
                                  BY REFERENCE

          SECTION 1.1. Definitions.

          "Acquired Indebtedness" means Indebtedness (1) of a Person or any of
its Subsidiaries existing at the time such Person becomes a Restricted
Subsidiary or (2) assumed in connection with the acquisition of assets from such
Person, in each case whether or not Incurred by such Person in connection with,
or in anticipation or contemplation of, such Person becoming a Restricted
Subsidiary or such acquisition. Acquired Indebtedness shall be deemed to have
been Incurred, with respect to clause (1) of the preceding sentence, on the date
such Person becomes a Restricted Subsidiary and, with respect to clause (2) of
the preceding sentence, on the date of consummation of such acquisition of
assets.

          "Additional Assets" means:

          (1)  any property, plant, equipment or other assets (excluding current
               assets other than inventory) to be used by the Company or a
               Restricted Subsidiary in a Related Business;

<PAGE>

          (2)  the Capital Stock of a Person that becomes a Restricted
               Subsidiary as a result of the acquisition of such Capital Stock
               by the Company or a Restricted Subsidiary; or

          (3)  Capital Stock constituting a minority interest in any Person that
               at such time is a Restricted Subsidiary;

provided, however, that, in the case of clauses (2) and (3), such Restricted
Subsidiary is primarily engaged in a Related Business, and provided further that
for the purposes of determining fair market value of Additional Assets for the
purposes of clause (2)(c) of the first paragraph under Section 3.7, such fair
market value shall be determined conclusively by:

          (1)  the Company acting in good faith, if such fair market value is
               estimated by the Company to be less than $5 million;

          (2)  the Board of Directors of the Company acting in good faith, whose
               resolution with respect thereto shall be delivered to the
               Trustee, if such fair market value is estimated by the Board of
               Directors of the Company to be less than $20 million; and

          (3)  an opinion or appraisal issued by an accounting, appraisal or
               investment banking firm of national standing, whose opinion or
               appraisal with respect thereto shall be delivered to the Trustee,
               if such fair market value is estimated in good faith by the Board
               of Directors of the Company to exceed $20 million.

          "Affiliate" of any specified Person means any other Person, directly
or indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.

          "Asset Disposition" means any direct or indirect sale, lease (other
than an operating lease entered into in the ordinary course of business),
transfer, issuance or other disposition, or a series of related sales, leases,
transfers, issuances or dispositions that are part of a common plan, of shares
of Capital Stock of a Subsidiary (other than directors' qualifying shares),
property or other assets (each referred to for the purposes of this definition
as a "disposition") by the Company or any of its Restricted Subsidiaries,
including any disposition by means of a merger, consolidation or similar
transaction.

          Notwithstanding the preceding, the following items shall not be deemed
to be Asset Dispositions:

          (1) a disposition of assets by a Restricted Subsidiary to the Company
     or by the Company or a Restricted Subsidiary to a Restricted Subsidiary;

                                        2

<PAGE>

          (2) the sale of Cash Equivalents in the ordinary course of business;

          (3) a disposition of inventory in the ordinary course of business;

          (4) a disposition of obsolete or worn out equipment or equipment or
     other personal property that is no longer useful in the conduct of the
     business of the Company and its Restricted Subsidiaries and that is
     disposed of in each case in the ordinary course of business;

          (5) transactions permitted pursuant to Section 4.1 and Restricted
     Payments permitted under Section 3.3 and Permitted Investments;

          (6) an issuance of Capital Stock by a Restricted Subsidiary to the
     Company or to a Restricted Subsidiary;

          (7) for purposes of Section 3.7 only, the making of a Permitted
     Investment (other than a Permitted Investment to the extent such
     transaction results in the receipt of cash or Cash Equivalents by the
     Company or its Restricted Subsidiaries) or a disposition subject to Section
     3.3;

          (8) dispositions of assets in a single transaction or series of
     related transactions with an aggregate fair market value of less than $1.0
     million;

          (9) the creation of a Permitted Lien and dispositions in connection
     with Permitted Liens;

          (10) dispositions of receivables in connection with the compromise,
     settlement or collection thereof in the ordinary course of business or in
     bankruptcy or similar proceedings and exclusive of factoring or similar
     arrangements;

          (11) the issuance by a Restricted Subsidiary of Preferred Stock that
     is permitted by Section 3.2;

          (12) the licensing or sublicensing of intellectual property or other
     general intangibles and licenses, leases or subleases of other property in
     the ordinary course of business which do not materially interfere with the
     business of the Company and its Restricted Subsidiaries; and

          (13) foreclosure on assets.

          "Attributable Indebtedness" in respect of a Sale/Leaseback Transaction
means, as at the time of determination, the present value (discounted at the
interest rate implicit in the transaction) of the total obligations of the
lessee for rental payments during the remaining term of the lease included in
such Sale/Leaseback Transaction (including any period for which such lease has
been extended), determined in accordance with GAAP; provided, however, that if
such Sale/Leaseback Transaction results in a Capitalized Lease Obligation, the
amount of Indebtedness represented thereby will be determined in accordance with
the definition of "Capitalized Lease Obligations."

                                        3

<PAGE>

          "Average Life" means, as of the date of determination, with respect to
any Indebtedness or Preferred Stock, the quotient obtained by dividing (1) the
sum of the products of the numbers of years from the date of determination to
the dates of each successive scheduled principal payment of such Indebtedness or
redemption or similar payment with respect to such Preferred Stock multiplied by
the amount of such payment by (2) the sum of all such payments.

          "Bankruptcy Law" means Title 11 of the United States Code or any
similar federal or state law for the relief of debtors.

          "Board of Directors" means, as to any Person, the board of directors
or managers, as applicable, of such Person (or, if such Person is a partnership,
the board of directors or other governing body of the general partner of such
Person) or any duly authorized committee thereof.

          "Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of a Person to have been duly adopted by the
Board of Directors of such Person and to be in full force and effect on the date
of such certification, and delivered to the Trustee.

          "Borrowing Base" means, as of the date of determination, an amount
equal to the sum, without duplication of (1) 85% of the net book value of the
Company's and its Restricted Subsidiaries' accounts receivable at such date and
(2) 70% of the net book value of the Company's and its Restricted Subsidiaries'
inventories at such date. Net book value shall be determined in accordance with
GAAP and shall be calculated using amounts reflected on the most recent
available balance sheet (it being understood that the accounts receivable and
inventories of an acquired business may be included if such acquisition has been
completed on or prior to the date of determination).

          "Business Day" means each day that is not a Saturday, Sunday or other
day on which banking institutions in New York, New York are authorized or
required by law to close.

          "Capital Stock" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participation or other equivalents of or
interests in (however designated) equity of such Person, including any Preferred
Stock and limited liability or partnership interests (whether general or
limited), but excluding any debt securities convertible into such equity.

          "Capitalized Lease Obligations" means an obligation that is required
to be classified and accounted for as a capitalized lease for financial
reporting purposes in accordance with GAAP, and the amount of Indebtedness
represented by such obligation will be the capitalized amount of such obligation
at the time any determination thereof is to be made as determined in accordance
with GAAP, and the Stated Maturity thereof will be the date of the last payment
of rent or any other amount due under such lease prior to the first date such
lease may be terminated without penalty.

          "Cash Equivalents" means:

                                        4

<PAGE>

          (1) securities issued or directly and fully guaranteed or insured by
     the United States Government or any agency or instrumentality of the United
     States (provided that the full faith and credit of the United States is
     pledged in support thereof), having maturities of not more than one year
     from the date of acquisition;

          (2) marketable general obligations issued by any state of the United
     States of America or any political subdivision of any such state or any
     public instrumentality thereof maturing within one year from the date of
     acquisition of the United States (provided that the full faith and credit
     of the United States is pledged in support thereof) and, at the time of
     acquisition, having a credit rating of "A" or better from either Standard &
     Poor's Ratings Services or Moody's Investors Service, Inc.;

          (3) certificates of deposit, time deposits, eurodollar time deposits,
     overnight bank deposits or bankers' acceptances having maturities of not
     more than one year from the date of acquisition thereof issued by any
     commercial bank the long-term debt of which is rated at the time of
     acquisition thereof at least "A" or the equivalent thereof by Standard &
     Poor's Ratings Services, or "A" or the equivalent thereof by Moody's
     Investors Service, Inc., and having combined capital and surplus in excess
     of $500 million;

          (4) repurchase obligations with a term of not more than seven days for
     underlying securities of the types described in clauses (1), (2) and (3)
     entered into with any bank meeting the qualifications specified in clause
     (3) above;

          (5) commercial paper rated at the time of acquisition thereof at least
     "A-2" or the equivalent thereof by Standard & Poor's Ratings Services or
     "P-2" or the equivalent thereof by Moody's Investors Service, Inc., or
     carrying an equivalent rating by a nationally recognized rating agency, if
     both of the two named rating agencies cease publishing ratings of
     investments, and in any case maturing within one year after the date of
     acquisition thereof; and

          (6) interests in any investment company or money market fund which
     invests 95% or more of its assets in instruments of the type specified in
     clauses (1) through (5) above.

          "CFC" means a "controlled foreign corporation" within the meaning of
Section 957(a) of the Code.

          "Change of Control" means:

          (1) prior to the first public offering of Common Stock of the Company,
     the Permitted Holders cease to be the "beneficial owner" (as defined in
     Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of a
     majority in the aggregate of the total voting power of the Voting Stock of
     the Company, whether as a result of the issuance of securities of the
     Company, any merger, consolidation, liquidation or dissolution of the
     Company, any direct or indirect transfer of securities by any Permitted
     Holder or otherwise (for purposes of this clause (1) and clause (2) below,
     the Permitted

                                        5

<PAGE>

     Holders shall be deemed to beneficially own any Voting Stock of an entity
     (the "specified entity") held by any other entity (the "parent entity") so
     long as the Permitted Holders beneficially own (as so defined), directly or
     indirectly, in the aggregate a majority of the voting power of the Voting
     Stock of the parent entity); or

          (2) on the date of or after the first public offering of Common Stock
     referred to in clause (1), (A) any "person" or "group" of related persons
     (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act),
     other than one or more Permitted Holders, becomes the beneficial owner (as
     defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that such
     person or group shall be deemed to have "beneficial ownership" of all
     shares that any such person or group has the right to acquire, whether such
     right is exercisable immediately or only after the passage of time),
     directly or indirectly, of more than 35% of the total voting power of the
     Voting Stock of the Company (or its successor by merger, consolidation or
     purchase of all or substantially all of its assets) (for the purposes of
     this clause, such person or group shall be deemed to beneficially own any
     Voting Stock of the Company held by a parent entity, if such person or
     group "beneficially owns" (as defined above), directly or indirectly, more
     than 35% of the voting power of the Voting Stock of such parent entity);
     and (B) the Permitted Holders "beneficially own" (as defined in Rules 13d-3
     and 13d-5 of the Exchange Act), directly or indirectly, in the aggregate a
     lesser percentage of the total voting power of the Voting Stock of the
     Company (or its successor by merger, consolidation or purchase of all or
     substantially all of its assets) than such other person or group and do not
     have the right or ability by voting power, contract or otherwise to elect
     or designate for election a majority of the Board of Directors of the
     Company or such successor (for the purposes of this clause, such other
     person or group shall be deemed to beneficially own any Voting Stock of a
     specified entity held by a parent entity, if such other person or group
     "beneficially owns" directly or indirectly, more than 35% of the voting
     power of the Voting Stock of such parent entity and the Permitted Holders
     "beneficially own" directly or indirectly, in the aggregate a lesser
     percentage of the voting power of the Voting Stock of such parent entity
     and do not have the right or ability by voting power, contract or otherwise
     to elect or designate for election a majority of the board of directors of
     such parent entity); or

          (3) the first day on which a majority of the members of the Board of
     Directors of the Company are not Continuing Directors; or

          (4) the sale, lease, transfer, conveyance or other disposition (other
     than by way of merger or consolidation), in one or a series of related
     transactions, of all or substantially all of the assets of the Company and
     its Restricted Subsidiaries taken as a whole to any "person" (as such term
     is used in Sections 13(d) and 14(d) of the Exchange Act) other than a
     Permitted Holder; or

          (5) the adoption by the stockholders of the Company of a plan or
     proposal for the liquidation or dissolution of the Company.

          "Code" means the Internal Revenue Code of 1986, as amended.

                                        6

<PAGE>

          "Commodity Agreement" means any commodity futures contract, commodity
swap, commodity option or other similar agreement or arrangement entered into by
the Company or any Restricted Subsidiary designed to protect the Company or any
of its Restricted Subsidiaries against fluctuations in the price of commodities
actually used in the ordinary course of business of the Company and its
Restricted Subsidiaries.

          "Common Stock" means with respect to any Person, any and all shares,
interest or other participations in, and other equivalents (however designated
and whether voting or nonvoting) of such Person's common stock whether or not
outstanding on the Issue Date, and includes, without limitation, all series and
classes of such common stock.

          "Consolidated Coverage Ratio" means as of any date of determination,
with respect to any Person, the ratio of (x) the aggregate amount of
Consolidated EBITDA of such Person for the period of the most recent four
consecutive fiscal quarters ending prior to the date of such determination for
which financial statements are in existence to (y) Consolidated Interest Expense
for such four fiscal quarters, provided, however, that:

          (1) if the Company or any Restricted Subsidiary:

               (a)  has Incurred any Indebtedness since the beginning of such
                    period that remains outstanding on such date of
                    determination or if the transaction giving rise to the need
                    to calculate the Consolidated Coverage Ratio is an
                    Incurrence of Indebtedness, Consolidated EBITDA and
                    Consolidated Interest Expense for such period will be
                    calculated after giving effect on a pro forma basis to such
                    Indebtedness as if such Indebtedness had been Incurred on
                    the first day of such period (except that in making such
                    computation, the amount of Indebtedness under any revolving
                    credit facility outstanding on the date of such calculation
                    will be deemed to be (i) the average daily balance of such
                    Indebtedness during such four fiscal quarters or such
                    shorter period for which such facility was outstanding or
                    (ii) if such facility was created after the end of such four
                    fiscal quarters, the average daily balance of such
                    Indebtedness during the period from the date of creation of
                    such facility to the date of such calculation) and the
                    discharge of any other Indebtedness repaid, repurchased,
                    defeased or otherwise discharged with the proceeds of such
                    new Indebtedness as if such discharge had occurred on the
                    first day of such period; or

               (b)  has repaid, repurchased, defeased or otherwise discharged
                    any Indebtedness since the beginning of the period that is
                    no longer outstanding on such date of determination or if
                    the transaction giving rise to the need to calculate the
                    Consolidated Coverage Ratio involves a discharge of
                    Indebtedness (in each case other than Indebtedness Incurred
                    under any revolving credit facility unless such Indebtedness
                    has been permanently repaid and the related commitment
                    terminated), Consolidated EBITDA and Consolidated

                                        7

<PAGE>

                    Interest Expense for such period will be calculated after
                    giving effect on a pro forma basis to such discharge of such
                    Indebtedness, including with the proceeds of such new
                    Indebtedness, as if such discharge had occurred on the first
                    day of such period;

          (2)  if since the beginning of such period the Company or any
               Restricted Subsidiary will have made any Asset Disposition or
               disposed of any company, division, operating unit, segment,
               business, group of related assets or line of business:

               (a)  the Consolidated EBITDA for such period will be reduced by
                    an amount equal to the Consolidated EBITDA (if positive)
                    directly attributable to the assets which are the subject of
                    such disposition for such period or increased by an amount
                    equal to the Consolidated EBITDA (if negative) directly
                    attributable thereto for such period; and

               (b)  Consolidated Interest Expense for such period will be
                    reduced by an amount equal to the Consolidated Interest
                    Expense directly attributable to any Indebtedness of the
                    Company or any Restricted Subsidiary repaid, repurchased,
                    defeased or otherwise discharged with respect to the Company
                    and its continuing Restricted Subsidiaries in connection
                    with such disposition for such period (or, if the Capital
                    Stock of any Restricted Subsidiary is sold, the Consolidated
                    Interest Expense for such period directly attributable to
                    the Indebtedness of such Restricted Subsidiary to the extent
                    the Company and its continuing Restricted Subsidiaries are
                    no longer liable for such Indebtedness after such sale);

          (3)  if since the beginning of such period the Company or any
               Restricted Subsidiary (by merger or otherwise) will have made an
               Investment in any Restricted Subsidiary (or any Person which
               becomes a Restricted Subsidiary or is merged with or into the
               Company) or an acquisition of assets, including any acquisition
               of assets occurring in connection with a transaction causing a
               calculation to be made hereunder, which constitutes all or
               substantially all of a company, division, operating unit,
               segment, business, group of related assets or line of business,
               Consolidated EBITDA and Consolidated Interest Expense for such
               period will be calculated after giving pro forma effect thereto
               (including the Incurrence of any Indebtedness) as if such
               Investment or acquisition occurred on the first day of such
               period; and

          (4)  if since the beginning of such period any Person (that
               subsequently became a Restricted Subsidiary or was merged with or
               into the Company or any Restricted Subsidiary since the beginning
               of such period) will have Incurred any Indebtedness or discharged
               any Indebtedness, made any disposition or any Investment or
               acquisition of assets that would have

                                        8

<PAGE>

               required an adjustment pursuant to clause (1), (2) or (3) above
               if made by the Company or a Restricted Subsidiary during such
               period, Consolidated EBITDA and Consolidated Interest Expense for
               such period will be calculated after giving pro forma effect
               thereto as if such transaction occurred on the first day of such
               period.

For purposes of this definition, whenever pro forma effect is to be given to any
calculation under this definition, the pro forma calculations will be determined
in good faith by a responsible financial or accounting officer of the Company
(including pro forma expense and cost reductions calculated on a basis
consistent with Regulation S-X under the Securities Act). If any Indebtedness
bears a floating rate of interest and is being given pro forma effect, the
interest expense on such Indebtedness will be calculated as if the rate in
effect on the date of determination had been the applicable rate for the entire
period (taking into account any Interest Rate Agreement applicable to such
Indebtedness if such Interest Rate Agreement has a remaining term in excess of
12 months). If any Indebtedness that is being given pro forma effect bears an
interest rate at the option of the Company, the interest rate shall be
calculated by applying such optional rate chosen by the Company.

          "Consolidated EBITDA" for any period means, without duplication, the
Consolidated Net Income for such period, plus the following to the extent
deducted in calculating such Consolidated Net Income:

          (1)  Consolidated Interest Expense; plus

          (2)  Consolidated Income Taxes; plus

          (3)  consolidated depreciation expense; plus

          (4)  consolidated amortization expense or impairment charges recorded
               in connection with the application of Financial Accounting
               Standard No. 142 "Goodwill and Other Intangibles" and Financial
               Accounting Standard No. 144 "Accounting for the Impairment or
               Disposal of Long Lived Assets;" plus

          (5)  other non-cash charges reducing Consolidated Net Income
               (excluding any such non-cash charge to the extent it represents
               an accrual of or reserve for cash charges in any future period or
               amortization of a prepaid cash expense that was paid in a prior
               period not included in the calculation); plus

          (6)  the amount of any restructuring charges or reserves (which, for
               the avoidance of doubt, shall include severance contract
               termination costs, including future lease commitments, costs to
               consolidate facilities and costs to relocate employees); plus

          (7)  expenses and charges resulting from the acquisition by the
               Company on January 23, 2006 of substantially all of the
               equipment, aftermarket parts

                                        9

<PAGE>

               and service, and equipment rental businesses that primarily
               served the oil and gas services industry of Stewart & Stevenson
               Services, Inc. and its affiliates, the initial establishment of
               the senior credit facility, the offering of the Initial
               Securities, and any concurrent amendment to the senior credit
               facility; less

          (8)  non-cash items increasing Consolidated Net Income of such Person
               for such period (excluding any items which represent the reversal
               of any accrual of, or reserve for, anticipated cash charges made
               in any prior period).

Notwithstanding the preceding sentence, clauses (2) through (8) relating to
amounts of a Restricted Subsidiary of a Person will be added to Consolidated Net
Income to compute Consolidated EBITDA of such Person only to the extent (and in
the same proportion) that the net income (loss) of such Restricted Subsidiary
was included in calculating the Consolidated Net Income of such Person and, to
the extent the amounts set forth in clauses (2) through (8) are in excess of
those necessary to offset a net loss of such Restricted Subsidiary or if such
non-guarantor Restricted Subsidiary has net income for such period included in
Consolidated Net Income, only if a corresponding amount would be permitted at
the date of determination to be dividended to the Company by such non-guarantor
Restricted Subsidiary without prior approval (that has not been obtained),
pursuant to the terms of its charter and all agreements, instruments, judgments,
decrees, orders, statutes, rules and governmental regulations applicable to that
non-guarantor Restricted Subsidiary or its stockholders.

          "Consolidated Income Taxes" means, with respect to any Person for any
period, taxes imposed upon such Person or other payments required to be made by
such Person by any governmental authority which taxes or other payments are
calculated by reference to the income or profits of such Person or such Person
and its Restricted Subsidiaries (to the extent such income or profits were
included in computing Consolidated Net Income for such period), regardless of
whether such taxes or payments are required to be remitted to any governmental
authority plus any Tax Distributions taken into account in calculating
Consolidated Net Income.

          "Consolidated Interest Expense" means, for any period, the total
interest expense of the Company and its consolidated Restricted Subsidiaries,
whether paid or accrued, plus, to the extent not included in such interest
expense:

          (1)  interest expense attributable to Capitalized Lease Obligations
               and the interest portion of rent expense associated with
               Attributable Indebtedness in respect of the relevant lease giving
               rise thereto, determined as if such lease were a capitalized
               lease in accordance with GAAP and the interest component of any
               deferred payment obligations;

          (2)  amortization of debt discount and debt issuance cost; provided,
               however, that any amortization of bond premium will be credited
               to reduce Consolidated Interest Expense unless, pursuant to GAAP,
               such amortization of bond premium has otherwise reduced
               Consolidated Interest Expense;

                                       10

<PAGE>

          (3)  non-cash interest expense;

          (4)  commissions, discounts and other fees and charges owed with
               respect to letters of credit and bankers' acceptance financing;

          (5)  interest actually paid by the Company or any Restricted
               Subsidiary under any Guarantee of Indebtedness or other
               obligation of any other Person;

          (6)  net costs associated with Hedging Obligations (including
               amortization of fees) provided, however, that if Hedging
               Obligations result in net benefits rather than net costs, such
               benefits shall be credited to reduce Consolidated Interest
               Expense unless, pursuant to GAAP, such net benefits are otherwise
               reflected in Consolidated Net Income;

          (7)  the consolidated interest expense of the Company and its
               Restricted Subsidiaries that was capitalized during such period;

          (8)  the product of (a) all dividends paid, in cash, Cash Equivalents
               or Indebtedness during such period on any series of Disqualified
               Stock of the Company or on Preferred Stock of its Restricted
               Subsidiaries that are not Subsidiary Guarantors payable to a
               party other than the Company or a Restricted Subsidiary, times
               (b) a fraction, the numerator of which is one and the denominator
               of which is one minus the then current combined federal, state,
               provincial and local statutory tax rate of the Company, expressed
               as a decimal, in each case, on a consolidated basis and in
               accordance with GAAP; and

          (9)  the cash contributions to any employee stock ownership plan or
               similar trust to the extent such contributions are used by such
               plan or trust to pay interest or fees to any Person (other than
               the Company and its Restricted Subsidiaries) in connection with
               Indebtedness Incurred by such plan or trust.

For the purpose of calculating the Consolidated Coverage Ratio, the calculation
of Consolidated Interest Expense shall include all interest expense (including
any amounts described in clauses (1) through (9) above) relating to any
Indebtedness of the Company or any Restricted Subsidiary described in the final
paragraph of the definition of "Indebtedness."

          For purposes of the foregoing, total interest expense will be
determined (i) after giving effect to any net payments made or received by the
Company and its Subsidiaries with respect to Interest Rate Agreements and (ii)
exclusive of amounts classified as other comprehensive income in the balance
sheet of the Company. Notwithstanding anything to the contrary contained herein,
commissions, discounts, yield and other fees and charges Incurred in connection
with any transaction pursuant to which the Company or its Restricted
Subsidiaries may sell, convey or otherwise transfer or grant a security interest
in any accounts receivable or related assets shall be included in Consolidated
Interest Expense.

                                       11

<PAGE>

          "Consolidated Net Income" means, for any period, the net income (loss)
of the Company and its consolidated Restricted Subsidiaries determined in
accordance with GAAP; provided, however, that there will not be included in such
Consolidated Net Income:

          (1)  any net income (loss) of any Person if such Person is not a
               Restricted Subsidiary, except that:

               (a)  subject to the limitations contained in clauses (3), (4) and
                    (5) below, the Company's equity in the net income of any
                    such Person for such period will be included in such
                    Consolidated Net Income up to the aggregate amount of cash
                    actually distributed by such Person during such period to
                    the Company or a Restricted Subsidiary as a dividend or
                    other distribution (subject, in the case of a dividend or
                    other distribution to a Restricted Subsidiary, to the
                    limitations contained in clause (2) below); and

               (b)  the Company's equity in a net loss of any such Person (other
                    than an Unrestricted Subsidiary) for such period will be
                    included in determining such Consolidated Net Income to the
                    extent such loss has been funded with cash from the Company
                    or a Restricted Subsidiary;

          (2)  any net income (but not loss) of any Restricted Subsidiary if
               such Subsidiary is subject to restrictions, directly or
               indirectly, on the payment of dividends or the making of
               distributions by such Restricted Subsidiary, directly or
               indirectly, to the Company, except that:

               (a)  subject to the limitations contained in clauses (3), (4) and
                    (5) below, the Company's equity in the net income of any
                    such Restricted Subsidiary for such period will be included
                    in such Consolidated Net Income up to the aggregate amount
                    of cash that could have been distributed by such Restricted
                    Subsidiary during such period to the Company or another
                    Restricted Subsidiary as a dividend (subject, in the case of
                    a dividend to another Restricted Subsidiary, to the
                    limitation contained in this clause); and

               (b)  the Company's equity in a net loss of any such Restricted
                    Subsidiary for such period will be included in determining
                    such Consolidated Net Income;

          (3)  any gain (loss) realized upon the sale or other disposition of
               any property, plant or equipment of the Company or its
               consolidated Restricted Subsidiaries (including pursuant to any
               Sale/Leaseback Transaction) which is not sold or otherwise
               disposed of in the ordinary course of business, or abandonment or
               reserves relating thereto, and any gain (loss) realized upon the
               sale or other disposition of any Capital Stock of any Person;

                                       12

<PAGE>

          (4)  any extraordinary gain or loss; and

          (5)  the cumulative effect of a change in accounting principles; and

provided further that an amount equal to the amount of Tax Distributions
actually made to the holders of Capital Stock of the Company or any parent
company of the Company in respect of such period in accordance with clause (9)
of the second paragraph under Section 3.3 shall be reflected in Consolidated Net
Income as though such amounts had been paid as income taxes directly by the
Company for such period.

          "Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company who: (1) was a member of such
Board of Directors on the Issue Date; or (2) was nominated for election or
elected to such Board of Directors with the approval of a majority of the
Continuing Directors who were members of such Board at the time of such
nomination or election.

          "Credit Facility" means, with respect to the Company or any Subsidiary
Guarantor, one or more debt facilities (including, without limitation, the
senior credit facility or commercial paper facilities with banks or other
institutional lenders providing for revolving credit loans, term loans,
receivables financing (including through the sale of receivables to such lenders
or to special purpose entities formed to borrow from such lenders against such
receivables) or letters of credit, in each case, as amended, restated, modified,
renewed, refunded, replaced or refinanced in whole or in part from time to time
(and whether or not with the original administrative agent and lenders or
another administrative agent or agents or other lenders and whether provided
under the original senior credit facility or any other credit or other agreement
or indenture).

          "Currency Agreement" means in respect of a Person any foreign exchange
contract, currency swap agreement, futures contract, option contract or other
similar agreement as to which such Person is a party or a beneficiary.

          "Custodian" means any receiver, trustee, assignee, liquidator,
custodian or similar official under any Bankruptcy Law.

          "Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.

          "Definitive Securities" means certificated Securities.

          "Disqualified Stock" means, with respect to any Person, any Capital
Stock of such Person which by its terms (or by the terms of any security into
which it is convertible or for which it is exchangeable) or upon the happening
of any event:

          (1)  matures or is mandatorily redeemable pursuant to a sinking fund
               obligation or otherwise;

                                       13

<PAGE>

          (2)  is convertible or exchangeable for Indebtedness or Disqualified
               Stock (excluding Capital Stock which is convertible or
               exchangeable solely at the option of the Company or a Restricted
               Subsidiary); or

          (3)  is redeemable at the option of the holder of the Capital Stock in
               whole or in part,

in each case on or prior to the date that is 91 days after the earlier of the
date (a) of the Stated Maturity of the Securities or (b) on which there are no
Securities outstanding, provided that only the portion of Capital Stock which so
matures or is mandatorily redeemable, is so convertible or exchangeable or is so
redeemable at the option of the holder thereof prior to such date will be deemed
to be Disqualified Stock; provided, further that any Capital Stock that would
constitute Disqualified Stock solely because the holders thereof have the right
to require the Company to repurchase such Capital Stock upon the occurrence of a
change of control or asset sale or disposition (each defined in a substantially
identical manner to the corresponding definitions in this Indenture) shall not
constitute Disqualified Stock if the terms of such Capital Stock (and all such
securities into which it is convertible or for which it is ratable or
exchangeable) provide that the Company may not repurchase or redeem any such
Capital Stock (and all such securities into which it is convertible or for which
it is ratable or exchangeable) pursuant to such provision prior to compliance by
the Issuers with the provisions of this Indenture described under Section 3.9
and by the Company with the provisions of this Indenture described under Section
3.7; and such repurchase or redemption complies with Section 3.3.

          "Domestic Subsidiary" means any Restricted Subsidiary that (1) is
organized under the laws of the United States of America or any state thereof or
the District of Columbia and (2) a guaranty of the Securities by such Subsidiary
would not result in that Subsidiary holding "United States property" within the
meaning of Treasury Regulations Section 1.956-2(c).

          "DTC" means The Depository Trust Company, its nominees and their
respective successors and assigns, or such other depository institution
hereinafter appointed by the Company.

          "Equity Offering" means a public offering for cash by the Company of
its Common Stock, or options, warrants or rights with respect to its Common
Stock, other than (w) public offerings with respect to the Company's Common
Stock, or options, warrants or rights, registered on Form S-4 or S-8, (x) any
public sale constituting an Excluded Contribution, (y) an issuance to any
Subsidiary or (z) any offering of Common Stock issued in connection with a
transaction that constitutes a Change of Control.

          "Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the SEC promulgated thereunder.

          "Exchange Securities" has the meaning ascribed to it in the second
introductory paragraph of this Indenture.

          "Excluded Contribution" means net cash proceeds, marketable securities
or Additional Assets received by the Company from:

                                       14

<PAGE>

          (1)  contributions to its common equity capital; and

          (2)  the sale (other than to a Subsidiary of the Company or to any
               management equity plan or stock option plan or any other
               management or employee benefit plan or agreement of the Company)
               of Capital Stock (other than Disqualified Stock) of the Company;

in each case designated as Excluded Contributions pursuant to an Officers'
Certificate on the date such capital contributions are made or the date such
Capital Stock is sold, as the case may be, which are excluded from the
calculation set forth in clause (c)(ii) contained in the first paragraph of
Section 3.3.

          "Flow Through Entity" means an entity that is treated as a partnership
not taxable as a corporation, a grantor trust or a disregarded entity for U.S.
federal income tax purposes or subject to treatment on a comparable basis for
purposes of state, local or foreign tax law.

          "Foreign Subsidiary" means any Restricted Subsidiary that is not a
Domestic Subsidiary.

          "GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the Issue Date, including those set forth
in the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant segment of the
accounting profession. All ratios and computations based on GAAP contained in
this Indenture will be computed in conformity with GAAP, except that in the
event the Company is acquired in a transaction that is accounted for using
purchase accounting, the effects of the application of purchase accounting shall
be disregarded in the calculation of such ratios and other computations
contained in this Indenture.

          "Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness of any other Person
and any obligation, direct or indirect, contingent or otherwise, of such Person:

          (1)  to purchase or pay (or advance or supply funds for the purchase
               or payment of) such Indebtedness of such other Person (whether
               arising by virtue of partnership arrangements, or by agreement to
               keep-well, to purchase assets, goods, securities or services, to
               take-or-pay, to maintain financial statement conditions or
               otherwise); or

          (2)  entered into for purposes of assuring in any other manner the
               obligee of such Indebtedness of the payment thereof or to protect
               such obligee against loss in respect thereof (in whole or in
               part); provided, however, that the term "Guarantee" will not
               include endorsements for collection or deposit in the ordinary
               course of business. The term "Guarantee" used as a verb has a
               corresponding meaning.

                                       15
<PAGE>

          "Guarantor Pari Passu Indebtedness" means Indebtedness of a Subsidiary
Guarantor that ranks equally in right of payment to its Subsidiary Guarantee.

          "Guarantor Subordinated Obligation" means, with respect to a
Subsidiary Guarantor, any Indebtedness of such Subsidiary Guarantor (whether
outstanding on the Issue Date or thereafter Incurred) which is expressly
subordinated in right of payment to the obligations of such Subsidiary Guarantor
under its Subsidiary Guarantee pursuant to a written agreement.

          "Hedging Obligations" of any Person means the obligations of such
Person pursuant to any Interest Rate Agreement, Currency Agreement or Commodity
Agreement.

          "Holder" or "Securityholder" means a Person in whose name a Security
is registered on the Registrar's books.

          "IAI" means an institutional "accredited investor" as described in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act.

          "Incur" means issue, create, assume, Guarantee, incur or otherwise
become liable for; provided, however, that any Indebtedness or Capital Stock of
a Person existing at the time such person becomes a Restricted Subsidiary
(whether by merger, consolidation, acquisition or otherwise) will be deemed to
be Incurred by such Restricted Subsidiary at the time it becomes a Restricted
Subsidiary; and the terms "Incurred" and "Incurrence" have meanings correlative
to the foregoing.

          "Indebtedness" means, with respect to any Person on any date of
determination (without duplication):

          (1)  the principal of and premium (if any and only to the extent then
               due) in respect of indebtedness of such Person for borrowed
               money;

          (2)  the principal of and premium (if any and only to the extent then
               due) in respect of obligations of such Person evidenced by bonds,
               debentures, notes or other similar instruments;

          (3)  the principal component of all obligations of such Person in
               respect of letters of credit, bankers' acceptances or other
               similar instruments (including reimbursement obligations with
               respect thereto except to the extent such reimbursement
               obligation relates to a trade payable and such obligation is
               satisfied within 30 days of Incurrence);

          (4)  the principal component of all obligations of such Person to pay
               the deferred and unpaid purchase price of property (except trade
               payables), to the extent such purchase price is due more than six
               months after the date of placing such property in service or
               taking delivery and title thereto;

          (5)  Capitalized Lease Obligations and all Attributable Indebtedness
               of such Person;

                                       16

<PAGE>

          (6)  the principal component or liquidation preference of all
               obligations of such Person with respect to the redemption,
               repayment or other repurchase of any Disqualified Stock or, with
               respect to any Restricted Subsidiary that is not a Subsidiary
               Guarantor, any Preferred Stock (but excluding, in each case, any
               accrued dividends);

          (7)  the principal component of all Indebtedness of other Persons
               secured by a Lien on any asset of such Person, whether or not
               such Indebtedness is assumed by such Person; provided, however,
               that the amount of such Indebtedness will be the lesser of (a)
               the fair market value of such asset at such date of determination
               and (b) the amount of such Indebtedness of such other Persons;

          (8)  the principal component of Indebtedness of other Persons to the
               extent Guaranteed by such Person;

          (9)  to the extent not otherwise included in this definition, net
               obligations of such Person under Hedging Obligations (the amount
               of any such obligations to be equal at any time to the
               termination value of such agreement or arrangement giving rise to
               such obligation that would be payable by such Person at such
               time); and

          (10) to the extent not otherwise included in this definition, the
               amount of obligations outstanding under the legal documents
               entered into as part of a securitization transaction or series of
               transactions that would be characterized as principal if such
               transaction were structured as a secured lending transaction
               rather than as a purchase.

The amount of Indebtedness of any Person at any date will be the outstanding
balance at such date of all unconditional obligations as described above and the
maximum liability, upon the occurrence of the contingency giving rise to the
obligation, of any contingent obligations at such date. Notwithstanding the
foregoing, money borrowed and set aside at the time of the Incurrence of any
Indebtedness in order to pre-fund the payment of interest on such Indebtedness
shall not be deemed to be "Indebtedness" provided that such money is held to
secure the payment of such interest.

          "Indenture" means this Indenture as amended or supplemented from time
to time.

          "Initial Purchaser" means J.P. Morgan Securities Inc., with respect to
the Initial Securities.

          "Initial Securities" has the meaning ascribed to it in the second
introductory paragraph of this Indenture.

          "Interest Rate Agreement" means with respect to any Person any
interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge

                                       17

<PAGE>

agreement or other similar agreement or arrangement as to which such Person is
party or a beneficiary.

          "Investment" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the form of any direct or
indirect advance, loan (other than accounts receivable, trade credit or other
advances or extensions of credit to customers in the ordinary course of
business) or other extensions of credit (including by way of Guarantee or
similar arrangement, but excluding any debt or extension of credit represented
by a bank deposit other than a time deposit) or capital contribution to (by
means of any transfer of cash or other property to others or any payment for
property or services for the account or use of others), or any purchase or
acquisition of Capital Stock, Indebtedness or other similar instruments issued
by, such Person and all other items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP; provided that
none of the following will be deemed to be an Investment:

          (1)  Hedging Obligations entered into in the ordinary course of
               business and in compliance with this Indenture;

          (2)  endorsements of negotiable instruments and documents in the
               ordinary course of business; and

          (3)  an acquisition of assets, Capital Stock or other securities by
               the Company or a Subsidiary for consideration to the extent such
               consideration consists of Common Stock of the Company.

          If the Company or any Restricted Subsidiary sells or otherwise
disposes of any Voting Stock of any Restricted Subsidiary such that, after
giving effect to any such sale or disposition, such entity is no longer a
Restricted Subsidiary of the Company, the Company shall be deemed to have made
an Investment on the date of any such sale or disposition equal to the fair
market value (as conclusively determined by the Board of Directors of the
Company in good faith) of the Capital Stock of such subsidiary not sold or
disposed of.

          For purposes of Section 3.3,

          (1)  "Investment" will include the portion (proportionate to the
               Company's equity interest in a Restricted Subsidiary to be
               designated as an Unrestricted Subsidiary) of the fair market
               value of the net assets of such Restricted Subsidiary at the time
               that such Restricted Subsidiary is designated an Unrestricted
               Subsidiary; provided, however, that upon a redesignation of such
               Subsidiary as a Restricted Subsidiary, the Company will be deemed
               to continue to have a permanent "Investment" in an Unrestricted
               Subsidiary in an amount (if positive) equal to (a) the Company's
               "Investment" in such Subsidiary at the time of such redesignation
               less (b) the portion (proportionate to the Company's equity
               interest in such Subsidiary) of the fair market value of the net
               assets (as conclusively determined by the Board of Directors of
               the Company in

                                       18

<PAGE>

               good faith) of such Subsidiary at the time that such Subsidiary
               is so re-designated a Restricted Subsidiary; and

          (2)  any property transferred to or from an Unrestricted Subsidiary
               will be valued at its fair market value at the time of such
               transfer, in each case as determined in good faith by the Board
               of Directors of the Company.

          "Issue Date" means the closing date for the sale and issuance of the
Initial Securities.

          "Legal Holiday" has the meaning ascribed to it in Section 11.8.

          "Lien" means any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including any conditional sale or other title
retention agreement or lease in the nature thereof).

          "Net Available Cash" from an Asset Disposition means cash payments
received (including any cash payments received by way of deferred payment of
principal pursuant to a note or installment receivable or otherwise and net
proceeds from the sale or other disposition of any securities received as
consideration, but only as and when received, but excluding any other
consideration received in the form of assumption by the acquiring person of
Indebtedness or other obligations relating to the properties or assets that are
the subject of such Asset Disposition or received in any other non-cash form)
therefrom, in each case net of:

          (1)  all legal, accounting, investment banking, title and recording
               tax expenses, commissions and other fees and expenses Incurred,
               and all Federal, state, provincial, foreign and local taxes
               required to be paid or accrued as a liability under GAAP (after
               taking into account any available tax credits or deductions and
               any tax sharing agreements), as a consequence of such Asset
               Disposition;

          (2)  all payments made on any Indebtedness which is secured by any
               assets subject to such Asset Disposition, in accordance with the
               terms of any Lien upon such assets, or which must by its terms,
               or in order to obtain a necessary consent to such Asset
               Disposition, or by applicable law be repaid out of the proceeds
               from such Asset Disposition;

          (3)  all distributions and other payments required to be made to
               minority interest holders in Subsidiaries or joint ventures as a
               result of such Asset Disposition; and

          (4)  the deduction of appropriate amounts to be provided by the seller
               as a reserve, in accordance with GAAP, against any liabilities
               associated with the assets disposed of in such Asset Disposition
               and retained by the Company or any Restricted Subsidiary after
               such Asset Disposition.

                                       19

<PAGE>

          "Net Cash Proceeds," with respect to any issuance or sale of Capital
Stock, means the cash proceeds of such issuance or sale net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees, listing fees,
discounts or commissions and brokerage, consultant and other fees and charges
actually Incurred in connection with such issuance or sale and net of taxes paid
or payable as a result of such issuance or sale (after taking into account any
available tax credit or deductions and any tax sharing arrangements).

          "Non-Guarantor Restricted Subsidiary" means any Restricted Subsidiary
that is not a Subsidiary Guarantor.

          "Non-Recourse Debt" means Indebtedness:

          (1)  as to which neither the Company nor any Restricted Subsidiary (a)
               provides any Guarantee or credit support of any kind (including
               any undertaking, guarantee, indemnity, agreement or instrument
               that would constitute Indebtedness) or (b) is directly or
               indirectly liable (as a guarantor or otherwise);

          (2)  no default with respect to which (including any rights that the
               holders thereof may have to take enforcement action against an
               Unrestricted Subsidiary) would permit (upon notice, lapse of time
               or both) any holder of any other Indebtedness of the Company or
               any Restricted Subsidiary to declare a default under such other
               Indebtedness or cause the payment thereof to be accelerated or
               payable prior to its Stated Maturity; and

          (3)  the explicit terms of which provide there is no recourse against
               any of the assets of the Company or its Restricted Subsidiaries.

          "Non-U.S. Person" means a Person who is not a U.S. Person (as defined
in Regulation S).

          "Officer" means the Chairman of the Board, the Chief Executive
Officer, the President, the Chief Financial Officer, any Vice President, the
Treasurer or the Secretary of the Company, or, in the event that the Company has
no such officers, a person duly authorized under applicable law by the managers,
members or a similar body to act on behalf of the Company. Officer of any
Subsidiary Guarantor has a correlative meaning.

          "Officers' Certificate" means a certificate signed by two Officers or
by an Officer and either an Assistant Treasurer or an Assistant Secretary of the
Company.

          "Opinion of Counsel" means a written opinion from legal counsel who is
acceptable to the Trustee. The counsel may be an employee of or counsel to
either of the Issuers or the Trustee.

          "Pari Passu Indebtedness" means Indebtedness that ranks equally in
right of payment to the Securities.

                                       20

<PAGE>

          "Permitted Holders" means Mr. Hushang Ansary, his family members or
Persons in which all Capital Stock and other equity interests in such Persons
are owned solely or otherwise controlled by Mr. Hushang Ansary and/or members of
his family. Notwithstanding the foregoing sentence, any person or group whose
acquisition of beneficial ownership constitutes a Change of Control in respect
of which a Change of Control Offer is made in accordance with the requirements
of this Indenture (or would result in a Change of Control Offer in the absence
of the waiver of such requirement by Holders in accordance with this Indenture)
will thereafter, together with any of its Affiliates and Related Persons,
constitute additional Permitted Holders.

          "Permitted Investment" means an Investment by the Company or any
Restricted Subsidiary in:

          (1)  a Restricted Subsidiary or a Person which will, upon the making
               of, or in connection with, such Investment, become a Restricted
               Subsidiary; provided, however, that the primary business of such
               Restricted Subsidiary is a Related Business;

          (2)  another Person if as a result of such Investment such other
               Person is merged or consolidated with or into, or transfers or
               conveys all or substantially all its assets to, the Company or a
               Restricted Subsidiary; provided, however, that such Person's
               primary business is a Related Business;

          (3)  cash and Cash Equivalents;

          (4)  receivables owing to the Company or any Restricted Subsidiary
               created or acquired in the ordinary course of business and
               payable or dischargeable in accordance with customary trade
               terms; provided, however, that such trade terms may include such
               concessionary trade terms as the Company or any such Restricted
               Subsidiary deems reasonable under the circumstances;

          (5)  payroll, travel and similar advances to cover matters that are
               expected at the time of such advances ultimately to be treated as
               expenses for accounting purposes and that are made in the
               ordinary course of business;

          (6)  loans or advances to employees, officers or directors of the
               Company or any Restricted Subsidiary of the Company in the
               ordinary course of business consistent with past practices, in an
               aggregate amount outstanding at any one time not in excess of
               $0.5 million with respect to all loans or advances made since the
               Issue Date (without giving effect to the forgiveness of any such
               loan); provided, however, that the Company and its Subsidiaries
               shall comply in all material respects with applicable law;

          (7)  Capital Stock, obligations or securities received in settlement
               of debts created in the ordinary course of business and owing to
               the Company or

                                       21

<PAGE>

               any Restricted Subsidiary or in satisfaction of judgments or
               pursuant to any plan of reorganization or similar arrangement
               upon the bankruptcy or insolvency of a debtor;

          (8)  Investments made as a result of the receipt of non-cash
               consideration from an Asset Disposition that was made pursuant to
               and in compliance with Section 3.7;

          (9)  Investments in existence on the Issue Date;

          (10) Currency Agreements, Interest Rate Agreements, Commodity
               Agreements and related Hedging Obligations, which transactions or
               obligations are Incurred in compliance with Section 3.2;

          (11) Investments by the Company or any of its Restricted Subsidiaries,
               together with all other Investments pursuant to this clause (11),
               in an aggregate amount at the time of such Investment not to
               exceed $10 million outstanding at any one time (with the fair
               market value of such Investment being measured at the time made
               and without giving effect to subsequent changes in value);

          (12) Guarantees issued in accordance with Section 3.2; and

          (13) any asset acquired pursuant to an Asset Disposition in accordance
               with Section 3.7.

          "Permitted Liens" means, with respect to any Person:

          (1)  Liens securing Indebtedness and other obligations under the
               senior credit facility and related Hedging Obligations and liens
               on assets of Restricted Subsidiaries securing Guarantees of
               Indebtedness and other obligations of the Company under the
               senior credit facility permitted to be Incurred under this
               Indenture under the provisions described in clause (1) of the
               second paragraph under Section 3.2;

          (2)  pledges or deposits by such Person under workers' compensation,
               unemployment insurance or similar legislation or regulation, or
               good faith deposits in connection with bids, tenders, contracts
               (other than for the payment of Indebtedness) or leases to which
               such Person is a party, or deposits to secure public or statutory
               obligations of such Person or deposits of cash or United States
               government bonds to secure surety performance or appeal bonds to
               which such Person is a party, or deposits securing liability for
               reimbursement or indemnification obligations of (including
               obligations in respect of letters of credit, bank guarantees or
               similar instruments for the benefit of) insurance carriers
               providing property, casualty or liability insurance, or deposits
               as security for contested taxes or import or customs duties or
               for the payment of rent, and

                                       22

<PAGE>

               deposits securing other obligations of a like nature, in each
               case Incurred in the ordinary course of business;

          (3)  Liens imposed by law, including carriers', warehousemen's,
               mechanics', materialmen's, landlord's, vendors, and repairmen's
               Liens, in each case for sums not over due by 30 days or being
               contested in good faith by appropriate proceedings if a reserve
               or other appropriate provisions, if any, as shall be required by
               GAAP shall have been made in respect thereof;

          (4)  Liens for taxes, assessments or other governmental charges not
               yet subject to penalties for non-payment or which are being
               contested in good faith by appropriate proceedings provided
               appropriate reserves required pursuant to GAAP have been made in
               respect thereof;

          (5)  Liens in favor of issuers of surety or performance bonds or
               letters of credit or bankers' acceptances issued pursuant to the
               request of and for the account of such Person in the ordinary
               course of its business; provided, however, that such letters of
               credit do not constitute Indebtedness;

          (6)  ground leases, easements, encroachments, protusions, or
               reservations of, or rights of others for, licenses, rights of
               way, sewers, electric lines, telegraph and telephone lines and
               other similar purposes, or zoning, restrictive covenants,
               building codes or other restrictions and encumbrances (including,
               without limitation, minor defects or irregularities in title and
               similar encumbrances any other defects and encumbrances noted and
               disclosed in title insurance policies issued for the account of
               the Company or any Restricted Subsidiary and any state of facts
               disclosed on any survey referenced in any such title policies and
               any replacement, extension or renewal of any such lien) as to the
               use of real properties or liens incidental to the conduct of the
               business of such Person or to the ownership of its properties
               which do not in the aggregate materially adversely affect the
               value of said properties or materially impair their use in the
               operation of the business of such Person;

          (7)  Liens securing Hedging Obligations so long as the related
               Indebtedness is, and is permitted to be under this Indenture,
               secured by a Lien on the same property securing such Hedging
               Obligation;

          (8)  leases, licenses, subleases and sublicenses of assets (including,
               without limitation, real property and intellectual property
               rights) which do not materially interfere with the ordinary
               conduct of the business of the Company or any of its Restricted
               Subsidiaries;

          (9)  judgment Liens not giving rise to an Event of Default so long as
               such Lien is adequately bonded and any appropriate legal
               proceedings which may have been duly initiated for the review of
               such judgment have not been

                                       23

<PAGE>

               finally terminated or the period within which such proceedings
               may be initiated has not expired;

          (10) Liens for the purpose of securing Indebtedness represented by
               Capitalized Lease Obligations, mortgage financings, purchase
               money obligations or other payments Incurred to finance all or
               any part of the purchase price or cost of construction or
               improvement of assets or property (other than Capital Stock or
               other Investments), including without limitation, inventory
               acquired, constructed or improved in the ordinary course of
               business; provided that:

               (a)  the aggregate principal amount of Indebtedness secured by
                    such Liens is otherwise permitted to be Incurred under this
                    Indenture and does not exceed the cost of the assets or
                    property so acquired, constructed or improved; and

               (b)  such Liens are created within 180 days of construction,
                    acquisition or improvement of such assets or property and do
                    not encumber any other assets or property of the Company or
                    any Restricted Subsidiary other than such assets or property
                    and assets affixed or appurtenant thereto;

          (11) Liens arising solely by virtue of any statutory or common law
               provisions relating to banker's Liens, rights of set-off or
               similar rights and remedies as to deposit accounts or other funds
               maintained with a depositary institution; provided that:

               (a)  such deposit account is not a dedicated cash collateral
                    account and is not subject to restrictions against access by
                    the Company in excess of those set forth by regulations
                    promulgated by the Federal Reserve Board; and

               (b)  such deposit account is not intended by the Company or any
                    Restricted Subsidiary to provide collateral to the
                    depository institution;

          (12) Liens arising from Uniform Commercial Code financing statement
               filings regarding operating leases entered into by the Company
               and its Restricted Subsidiaries in the ordinary course of
               business;

          (13) Liens existing on the Issue Date (other than Liens permitted
               under clause (1) above);

          (14) Liens on property or shares of stock of a Person at the time such
               Person becomes a Restricted Subsidiary; provided, however, that
               such Liens are not created, Incurred or assumed in connection
               with, or in contemplation of, such other Person becoming a
               Restricted Subsidiary; provided further,

                                       24

<PAGE>

               however, that any such Lien may not extend to any other property
               owned by the Company or any Restricted Subsidiary;

          (15) Liens on property at the time the Company or a Restricted
               Subsidiary acquired the property, including any acquisition by
               means of a merger or consolidation with or into the Company or
               any Restricted Subsidiary; provided, however, that such Liens are
               not created, Incurred or assumed in connection with, or in
               contemplation of, such acquisition; provided further, however,
               that such Liens may not extend to any other property owned by the
               Company or any Restricted Subsidiary;

          (16) Liens securing Indebtedness or other obligations of a Restricted
               Subsidiary owing to the Company or a Wholly-Owned Subsidiary;

          (17) Liens securing the Securities and Subsidiary Guarantees;

          (18) Liens securing Refinancing Indebtedness Incurred to refinance,
               refund, replace, amend, extend or modify, as a whole or in part,
               Indebtedness that was previously so secured pursuant to clauses
               (10), (13), (14), (15), (17) and (18) of this definition,
               provided that any such Lien is limited to all or part of the same
               property or assets (plus improvements, accessions, proceeds or
               dividends or distributions in respect thereof) that secured (or,
               under the written arrangements under which the original Lien
               arose, could secure) the Indebtedness being refinanced or is in
               respect of property that is the security for a Permitted Lien
               hereunder;

          (19) any leasehold interest or title of a lessor or sublessor under
               any Capitalized Lease Obligation or operating lease;

          (20) Liens under industrial revenue, municipal or similar bonds;

          (21) any interest of a consignor in goods held by the Company or any
               Restricted Subsidiary on consignment provided that such goods are
               held on consignment in the ordinary course of business; and

          (22) Liens solely on any cash earnest money deposits made by the
               Company or any Restricted Subsidiary in connection with any
               letter of intent or purchase agreement with respect to the
               purchase of assets or property the Company or a Restricted
               Subsidiary which is permitted by this Indenture.

          "Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company, government or any agency or political subdivision
hereof or any other entity.

          "Preferred Stock," as applied to the Capital Stock of any corporation,
means Capital Stock of any class or classes (however designated) which is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or

                                       25

<PAGE>

dissolution of such corporation, over shares of Capital Stock of any other class
of such corporation.

          "Presumed Tax Rate" means the highest effective marginal statutory
combined U.S. federal, state and local income tax return prescribed for an
individual residing in New York City (taking into account (i) the deductibility
of state and local income taxes for U.S. federal income tax purposes, assuming
the limitation of Section 68(a) of the Code applies and taking into account any
impact of Section 68(f) of the Code, and (ii) the character (long-term or
short-term capital gain, dividend income or other ordinary income) of the
applicable income).

          "QIB" means any "qualified institutional buyer" as such term is
defined in Rule 144A.

          "Rating Agencies" means Standard & Poor's Ratings Group, Inc. and
Moody's Investors Service, Inc. or if Standard & Poor's Ratings Group, Inc. or
Moody's Investors Service, Inc. or both shall not make a rating on the notes
publicly available, a nationally recognized statistical rating agency or
agencies, as the case may be, selected by the Company (as certified by a
resolution of the Board of Directors) which shall be substituted for Standard &
Poor's Ratings Group, Inc. or Moody's Investors Service, Inc. or both, as the
case may be.

          "Redemption Date" means, with respect to any redemption of Securities,
the date of redemption with respect thereto.

          "Refinancing Indebtedness" means Indebtedness that is Incurred to
refund, refinance, replace, exchange, renew, repay or extend (including pursuant
to any defeasance or discharge mechanism) (collectively, "refinance;"
"refinances," and "refinanced" shall each have a correlative meaning) any
Indebtedness existing on the Issue Date or Incurred in compliance with this
Indenture (including Indebtedness of the Company that refinances Indebtedness of
any Restricted Subsidiary and Indebtedness of any Restricted Subsidiary that
refinances Indebtedness of another Restricted Subsidiary) including Indebtedness
that refinances Refinancing Indebtedness, provided, however, that:

          (1)  (a) if the Stated Maturity of the Indebtedness being refinanced
               is earlier than the Stated Maturity of the Securities, the
               Refinancing Indebtedness has a Stated Maturity no earlier than
               the Stated Maturity of the Indebtedness being refinanced or (b)
               if the Stated Maturity of the Indebtedness being refinanced is
               later than the Stated Maturity of the Securities, the Refinancing
               Indebtedness has a Stated Maturity at least 91 days later than
               the Stated Maturity of the Securities;

          (2)  the Refinancing Indebtedness has an Average Life at the time such
               Refinancing Indebtedness is Incurred that is equal to or greater
               than the Average Life of the Indebtedness being refinanced;

          (3)  such Refinancing Indebtedness is Incurred in an aggregate
               principal amount (or if issued with original issue discount, an
               aggregate issue price) that is equal to or less than the sum of
               the aggregate principal amount (or

                                       26

<PAGE>

               if issued with original issue discount, the aggregate accreted
               value) then outstanding of the Indebtedness being refinanced
               (plus, without duplication, any additional Indebtedness Incurred
               to pay interest or premiums required by the instruments governing
               such existing Indebtedness and fees Incurred in connection
               therewith); and

          (4)  if the Indebtedness being refinanced is subordinated in right of
               payment to the Securities or the Subsidiary Guarantee, such
               Refinancing Indebtedness is subordinated in right of payment to
               the Securities or the Subsidiary Guarantee on terms at least as
               favorable to the Holders as those contained in the documentation
               governing the Indebtedness being refinanced.

          "Registered Exchange Offer" shall have the meaning set forth in the
Registration Rights Agreement.

          "Registrable Securities" shall mean the Securities; provided that the
Securities shall cease to be Registrable Securities (i) when a registration
statement with respect to such Securities has become effective under the
Securities Act and such Securities have been exchanged or disposed of pursuant
to such registration statement, (ii) when such Securities are eligible to be
sold pursuant to Rule 144(k) (or any similar provision then in force, but not
Rule 144A) under the Securities Act or (iii) when such Securities cease to be
outstanding.

          "Registration Rights Agreement" means that certain registration rights
agreement dated as of the Issue Date by and among the Issuers, the Subsidiary
Guarantors and the Initial Purchaser set forth therein and, with respect to any
Additional Securities, one or more substantially similar registration rights
agreements among the Issuers and the other parties thereto, as such agreements
may be amended from time to time.

          "Related Business" means any business which is the same as or related,
ancillary or complementary to, or a reasonable extension of, any of the
businesses of the Company and its Restricted Subsidiaries on the Issue Date.

          "Related Business Assets" means assets used or useful in a Related
Business.

          "Related Person" with respect to any Permitted Holder means:

          (1)  any controlling stockholder or a majority (or more) owned
               Subsidiary of such Permitted Holder or, in the case of an
               individual, any spouse or immediate family member of such
               Permitted Holder, any trust created for the benefit of such
               individual or such individual's estate, executor, administrator,
               committee or beneficiaries; or

          (2)  any trust, corporation, partnership or other entity, the
               beneficiaries, stockholders, partners, owners or Persons
               beneficially holding a majority (or more) controlling interest of
               which consist of such Permitted Holder and/or such other Persons
               referred to in the immediately preceding clause (1).

                                       27

<PAGE>

          "Restricted Investment" means any Investment other than a Permitted
Investment.

          "Restricted Period", with respect to any Securities, means the period
of 40 consecutive days beginning on and including the later of (A) the day on
which the Securities are first offered to Persons other than distributors (as
defined in Regulation S), notice of which day shall be promptly given by the
Company to the Trustee, and (B) the issue date with respect to such Securities.

          "Restricted Securities Legend" means the Private Placement Legend set
forth in Section 2.1(d)(A) or the Regulation S Legend set forth in Section
2.1(d)(B), as applicable.

          "Restricted Subsidiary" means any Subsidiary of the Company other than
an Unrestricted Subsidiary.

          "Rule 144A" means Rule 144A under the Securities Act.

          "Sale/Leaseback Transaction" means an arrangement relating to property
now owned or hereafter acquired whereby the Company or a Restricted Subsidiary
transfers such property to a Person and the Company or a Restricted Subsidiary
leases it from such Person.

          "SEC" means the United States Securities and Exchange Commission.

          "Securities" has the meaning ascribed to it in the second introductory
paragraph of this Indenture.

          "Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.

          "Securities Custodian" means the custodian with respect to the Global
Securities (as defined below) (as appointed by DTC), or any successor Person
thereto and shall initially be the Trustee.

          "Shelf Registration Statement" shall mean a "shelf" registration
statement of the Issuers and the Subsidiary Guarantors that covers all or a
portion of the Registrable Securities (but no other securities unless approved
by a majority of the Holders whose Registrable Securities are to be covered by
such "shelf" registration statement) on an appropriate form under Rule 415 under
the Securities Act, or any similar rule that may be adopted by the SEC, and all
amendments and supplements to such registration statement, including
post-effective amendments, in each case including the prospectus contained
therein or deemed a part thereof, all exhibits thereto and any document
incorporated by reference therein.

          "senior credit facility" means the Amended and Restated Credit
Agreement dated as of July 6, 2006 among the Company, certain other borrowers
named therein, JPMorgan Chase Bank, N.A., as Administrative Agent, and the
lenders parties thereto from time to time, as the same may be amended, restated,
modified, renewed, refunded, replaced or refinanced in whole or in part from
time to time (including increasing the amount loaned thereunder provided that
such additional Indebtedness is Incurred in accordance with Section 3.2);
provided that a senior credit facility shall not (x) include Indebtedness
issued, created or Incurred pursuant to a registered

                                       28

<PAGE>

offering of securities under the Securities Act or a private placement of
securities (including under Rule 144A or Regulation S) pursuant to an exemption
from the registration requirements of the Securities Act or (y) relate to
Indebtedness that does not consist exclusively of Pari Passu Indebtedness or
Guarantor Pari Passu Indebtedness.

          "Significant Subsidiary" means any Restricted Subsidiary that would be
a "Significant Subsidiary" of the Company within the meaning of Rule 1-02 under
Regulation S-X promulgated by the SEC.

          "Stated Maturity" means, with respect to any security, the date
specified in such security as the fixed date on which the payment of principal
of such security is due and payable, including pursuant to any mandatory
redemption provision, but shall not include any contingent obligations to repay,
redeem or repurchase any such principal prior to the date originally scheduled
for the payment thereof.

          "Subordinated Obligation" means any Indebtedness of the Company
(whether outstanding on the Issue Date or thereafter Incurred) which is
subordinated or junior in right of payment to the Securities pursuant to a
written agreement.

          "Subsidiary" of any Person means (a) any corporation, association or
other business entity (other than a partnership, joint venture, limited
liability company or similar entity) of which more than 50% of the total
ordinary voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof (or persons performing similar functions) or (b) any
partnership, joint venture, limited liability company or similar entity of which
more than 50% of the capital accounts, distribution rights, total equity and
voting interests or general or limited partnership interests, as applicable, is,
in the case of clauses (a) and (b), at the time owned or controlled, directly or
indirectly, by (1) such Person, (2) such Person and one or more Subsidiaries of
such Person or (3) one or more Subsidiaries of such Person. Unless otherwise
specified herein, each reference to a Subsidiary will refer to a Subsidiary of
the Company.

          "Subsidiary Guarantee" means, individually, any Guarantee of payment
of the Securities and Exchange Securities issued in a registered exchange offer
pursuant to the Registration Rights Agreement by a Subsidiary Guarantor pursuant
to the terms of this Indenture and any supplemental indenture thereto, and,
collectively, all such Guarantees.

          "Subsidiary Guarantor" means each Domestic Subsidiary or Foreign
Subsidiary that is neither a CFC nor directly or indirectly owned by a CFC in
existence on the Issue Date that provides a Subsidiary Guarantee on the Issue
Date (and any other Domestic Subsidiary or Foreign Subsidiary that is neither a
CFC nor directly or indirectly owned by a CFC that provides a Subsidiary
Guarantee in accordance with this Indenture); provided that upon release or
discharge of such Subsidiary from its Subsidiary Guarantee in accordance with
this Indenture, such Subsidiary ceases to be a Subsidiary Guarantor.

          "Tax Distributions" means any distributions described in clause (9) of
the second paragraph of Section 3.3.

                                       29

<PAGE>

          "TIA" or "Trust Indenture Act" means the Trust Indenture Act of 1939
(15 U.S.C. Sections 77aaa-77bbbb), as in effect on the date of this Indenture.

          "Trust Officer" shall mean, when used with respect to the Trustee, any
officer within the corporate trust department of the Trustee, including any vice
president, assistant vice president, assistant treasurer, trust officer or any
other officer of the Trustee who customarily performs functions similar to those
performed by the Persons who at the time shall be such officers, respectively,
or to whom any corporate trust matter is referred because of such person's
knowledge of and familiarity with the particular subject and who shall have
direct responsibility for the administration of this Indenture.

          "Trustee" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor.

          "Unrestricted Subsidiary" means:

          (1)  any Subsidiary of the Company that at the time of determination
               shall be designated an Unrestricted Subsidiary by the Board of
               Directors of the Company in the manner provided below; and

          (2)  any Subsidiary of an Unrestricted Subsidiary.

The Board of Directors of the Company may designate any Subsidiary of the
Company (including any newly acquired or newly formed Subsidiary or a Person
becoming a Subsidiary through merger or consolidation or Investment therein) to
be an Unrestricted Subsidiary only if:

          (1)  such Subsidiary or any of its Subsidiaries does not own any
               Capital Stock or Indebtedness of or have any Investment in, or
               own or hold any Lien on any property of, any other Subsidiary of
               the Company which is not a Subsidiary of the Subsidiary to be so
               designated or otherwise an Unrestricted Subsidiary;

          (2)  all the Indebtedness of such Subsidiary and its Subsidiaries
               shall, at the date of designation, and will at all times
               thereafter, consist of Non-Recourse Debt;

          (3)  such designation and the Investment of the Company in such
               Subsidiary complies with Section 3.3;

          (4)  such Subsidiary, either alone or in the aggregate with all other
               Unrestricted Subsidiaries, does not operate, directly or
               indirectly, all or substantially all of the business of the
               Company and its Subsidiaries;

          (5)  such Subsidiary is a Person with respect to which neither the
               Company nor any of its Restricted Subsidiaries has any direct or
               indirect obligation:

               (a)  to subscribe for additional Capital Stock of such Person; or

                                       30

<PAGE>

               (b)  to maintain or preserve such Person's financial condition or
                    to cause such Person to achieve any specified levels of
                    operating results; and

          (6)  on the date such Subsidiary is designated an Unrestricted
               Subsidiary, such Subsidiary is not a party to any agreement,
               contract, arrangement or understanding with the Company or any
               Restricted Subsidiary with terms substantially less favorable to
               the Company than those that might have been obtained from Persons
               who are not Affiliates of the Company.

Any such designation by the Board of Directors of the Company shall be evidenced
to the Trustee by filing with the Trustee a resolution of the Board of Directors
of the Company giving effect to such designation and an Officers' Certificate
certifying that such designation complies with the foregoing conditions. If, at
any time, any Unrestricted Subsidiary would fail to meet the foregoing
requirements as an Unrestricted Subsidiary, it shall thereafter cease to be an
Unrestricted Subsidiary for purposes of this Indenture and any Indebtedness of
such Subsidiary shall be deemed to be Incurred as of such date.

          The Board of Directors of the Company may designate any Unrestricted
Subsidiary to be a Restricted Subsidiary; provided that immediately after giving
effect to such designation, no Default or Event of Default shall have occurred
and be continuing or would occur as a consequence thereof and the Company could
Incur at least $1.00 of additional Indebtedness pursuant to the first paragraph
of Section 3.2 on a pro forma basis taking into account such designation.

          "U.S. Government Obligations" means securities that are (a) direct
obligations of the United States of America for the timely payment of which its
full faith and credit is pledged or (b) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the timely payment of which is unconditionally guaranteed as a full
faith and credit obligation of the United States of America, which, in either
case, are not callable or redeemable at the option of the issuer thereof, and
shall also include a depositary receipt issued by a bank (as defined in Section
3(a)(2) of the Securities Act), as custodian with respect to any such U.S.
Government Obligations or a specific payment of principal of or interest on any
such U.S. Government Obligations held by such custodian for the account of the
holder of such depositary receipt; provided that (except as required by law)
such custodian is not authorized to make any deduction from the amount payable
to the holder of such depositary receipt from any amount received by the
custodian in respect of the U.S. Government Obligations or the specific payment
of principal of or interest on the U.S. Government Obligations evidenced by such
depositary receipt.

          "Voting Stock" of a Person means all classes of Capital Stock of such
Person then outstanding and normally entitled to vote in the election of
directors, managers or trustees, as applicable.

          "Wholly-Owned Subsidiary" means a Restricted Subsidiary, all of the
Capital Stock of which (other than directors' qualifying shares) is owned by the
Company or another Wholly-Owned Subsidiary.

                                       31

<PAGE>

          SECTION 1.2. Other Definitions.

<TABLE>
<CAPTION>
                                                                      Defined in
Term                                                                    Section
----                                                                  ----------
<S>                                                                   <C>
"Additional Restricted Securities".................................    2.1(b)
"Affiliate Transaction"............................................    3.8
"Agent"............................................................    3.12
"Agent Members"....................................................    2.1(e)
"Asset Disposition Offer"..........................................    3.7
"Asset Disposition Offer Amount"...................................    3.7
"Asset Disposition Offer Period"...................................    3.7
"Asset Disposition Purchase Date"..................................    3.7
"Authenticating Agent".............................................    2.2
"Change of Control Offer"..........................................    3.9
"Change of Control Payment"........................................    3.9
"Change of Control Payment Date"...................................    3.9
"Company Order"....................................................    2.2
"covenant defeasance option".......................................    8.1(b)
"cross acceleration provision".....................................    6.1(6)(b)
"Defaulted Interest"...............................................    2.13
"Event of Default".................................................    6.1
"Excess Proceeds"..................................................    3.7
"Exchange Global Note".............................................    2.1(b)
"Guarantor Obligations"............................................   10.1
"Global Securities"................................................    2.1(b)
"Institutional Accredited Investor Global Note"....................    2.1(b)
</TABLE>

                                       32

<PAGE>

<TABLE>
<CAPTION>
                                                                      Defined in
Term                                                                    Section
----                                                                  ----------
<S>                                                                   <C>
"Institutional Accredited Investor Notes"..........................    2.1(b)
"legal defeasance option"..........................................    8.1(b)
"Pari Passu Notes".................................................    3.7
"payment default"..................................................    6.1(6)(a)
"Paying Agent".....................................................    2.3
"Private Placement Legend".........................................    2.1(d)
"protected purchaser"..............................................    2.9
"Registrar"........................................................    2.3
"Regulation S Global Note".........................................    2.1(b)
"Regulation S Legend"..............................................    2.1(d)
"Regulation S Notes"...............................................    2.1(b)
"Resale Restriction Termination Date"..............................    2.6(a)
"Restricted Payment"...............................................    3.3
"Restricted Securities"............................................    2.1(a)
"Rule 144A Global Note"............................................    2.1(b)
"Rule 144A Notes"..................................................    2.1(b)
"Securities Register"..............................................    2.3
"Special Interest Payment Date"....................................    2.13(a)
"Special Record Date"..............................................    2.13(a)
"Successor Company"................................................    4.1
</TABLE>

          SECTION 1.3. Incorporation by Reference of Trust Indenture Act. This
Indenture is subject to the mandatory provisions of the TIA, which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:

          "Commission" means the SEC.

                                       33

<PAGE>

          "indenture securities" means the Securities.

          "indenture security Holder" means a Securityholder.

          "indenture to be qualified" means this Indenture.

          "indenture trustee" or "institutional trustee" means the Trustee.

          "obligor" on the indenture securities means the Issuers, the
Subsidiary Guarantors and any other obligor on the indenture securities.

          All other TIA terms used in this Indenture that are defined by the
TIA, defined in the TIA by reference to another statute or defined by SEC rule
have the meanings assigned to them by such definitions.

          SECTION 1.4. Rules of Construction. Unless the context otherwise
requires:

          (1) a term has the meaning assigned to it;

          (2) an accounting term not otherwise defined has the meaning assigned
     to it in accordance with GAAP;

          (3) "or" is not exclusive;

          (4) "including" means including without limitation;

          (5) words in the singular include the plural and words in the plural
     include the singular;

          (6) the principal amount of any noninterest bearing or other discount
     security at any date shall be the principal amount thereof that would be
     shown on a balance sheet of the issuer dated such date prepared in
     accordance with GAAP;

          (7) the principal amount of any Preferred Stock shall be (i) the
     maximum liquidation value of such Preferred Stock or (ii) the maximum
     mandatory redemption or mandatory repurchase price with respect to such
     Preferred Stock, whichever is greater;

          (8) all amounts expressed in this Indenture or in any of the
     Securities in terms of money refer to the lawful currency of the United
     States of America; and

          (9) the words "herein," "hereof" and "hereunder" and other words of
     similar import refer to this Indenture as a whole and not to any particular
     Article, Section or other subdivision.

                                       34
<PAGE>

                                   ARTICLE II

                                 THE SECURITIES

          SECTION 2.1. Form, Dating and Terms.

          (a) The aggregate principal amount of Securities that may be
authenticated and delivered under this Indenture is unlimited. The Initial
Securities issued on the date hereof will be in an aggregate principal amount of
$150,000,000. In addition, the Issuers may issue, from time to time in
accordance with the provisions of this Indenture, Additional Securities and
Exchange Securities. Furthermore, Securities may be authenticated and delivered
upon registration or transfer, or in lieu of, other Securities pursuant to
Section 2.6, 2.9, 2.11 or 9.5 or in connection with a redemption pursuant to
Section 5.8 or a Change of Control Offer pursuant to Section 3.9.

          The Initial Securities shall be known and designated as "10% Senior
Notes due 2014" of the Issuers. Additional Securities issued as securities
bearing one of the restrictive legends described in Section 2.1(d) ("Restricted
Securities") shall also be known and designated as "10% Senior Notes due 2014"
of the Company.

          With respect to any Additional Securities, each of the Issuers shall
set forth in (a) a Board Resolution of each of the Issuers and (b) (i) an
Officers' Certificate or (ii) one or more indentures supplemental hereto, the
following information:

          (1) the aggregate principal amount of such Additional Securities to be
     authenticated and delivered pursuant to this Indenture;

          (2) the issue price and the issue date of such Additional Securities,
     including the date from which interest shall accrue; and

          (3) whether such Additional Securities shall be Restricted Securities
     issued in the form of Exhibit A hereto.

          The Initial Securities, the Additional Securities and the Exchange
Securities shall be considered collectively as a single class for all purposes
of this Indenture. Holders of the Initial Securities, the Additional Securities
and the Exchange Securities will vote and consent together on all matters to
which such Holders are entitled to vote or consent as one class, and none of the
Holders of the Initial Securities, the Additional Securities or the Exchange
Securities shall have the right to vote or consent as a separate class on any
matter to which such Holders are entitled to vote or consent.

          If any of the terms of any Additional Securities are established by
action taken pursuant to a Board Resolution of each of the Issuers, a copy of an
appropriate record of such action shall be certified by the Secretary or any
Assistant Secretary of each of the Issuers and delivered to the Trustee at or
prior to the delivery of the Officers' Certificate or the indenture supplemental
hereto setting forth the terms of the Additional Securities.

                                       35

<PAGE>

          (b) The Initial Securities are being offered and sold by the Issuers
pursuant to a Purchase Agreement, dated June 29, 2006, among the Issuers, the
Subsidiary Guarantors and the Initial Purchaser. The Initial Securities and any
Additional Securities (if issued as Restricted Securities) (the "Additional
Restricted Securities") will be resold initially only to (A) QIBs in reliance on
Rule 144A and (B) Non-U.S. Persons in reliance on Regulation S. Such Initial
Securities and Additional Restricted Securities may thereafter be transferred
to, among others, QIBs, purchasers in reliance on Regulation S and IAIs in
accordance with Rule 501 of the Securities Act, in each case, in accordance with
the procedure described herein. Additional Securities offered after the date
hereof may be offered and sold by the Issuers from time to time pursuant to one
or more purchase agreements in accordance with applicable law.

          Initial Securities and Additional Restricted Securities offered and
sold to QIBs in the United States of America in reliance on Rule 144A (the "Rule
144A Notes") shall be issued in the form of a permanent global Security, without
interest coupons, substantially in the form of Exhibit A, which is hereby
incorporated by reference and made a part of this Indenture, including
appropriate legends as set forth in Section 2.1(d) (the "Rule 144A Global
Note"), deposited with the Trustee, as custodian for DTC, duly executed by the
Issuers and authenticated by the Trustee as hereinafter provided. The Rule 144A
Global Note may be represented by more than one certificate, if so required by
DTC's rules regarding the maximum principal amount to be represented by a single
certificate. The aggregate principal amount of the Rule 144A Global Note may
from time to time be increased or decreased by adjustments made on the Rule 144A
Global Note and on the records of the Trustee, as custodian for DTC or its
nominee, as hereinafter provided.

          Initial Securities and Additional Securities offered and sold outside
the United States of America (the "Regulation S Notes") in reliance on
Regulation S shall be issued in the form of a permanent global Security, without
interest coupons, substantially in the form of Exhibit A including appropriate
legends as set forth in Section 2.1(d) (the "Regulation S Global Note"). The
Regulation S Global Note will be deposited upon issuance with the Trustee, as
custodian for DTC, duly executed by the Issuers and authenticated by the Trustee
as hereinafter provided. During the Restricted Period, interests in the
Regulation S Global Note may be transferred to Non-U.S. Persons pursuant to
Regulation S or to QIBs and IAIs in accordance with this Indenture.

          The Regulation S Global Note may be represented by more than one
certificate, if so required by DTC's rules regarding the maximum principal
amount to be represented by a single certificate. The aggregate principal amount
of the Regulation S Global Note may from time to time be increased or decreased
by adjustments made on the Regulation S Global Note and on the records of the
Trustee, as custodian for DTC or its nominee, as hereinafter provided.

          Initial Securities and Additional Securities resold to IAIs (the
"Institutional Accredited Investor Notes") in the United States of America shall
be issued in the form of a permanent global Security, without interest coupons,
substantially in the form of Exhibit A including appropriate legends as set
forth in Section 2.1(d) (the "Institutional Accredited Investor Global Note")
deposited with the Trustee, as custodian for DTC, duly executed by the Issuers
and authenticated by the Trustee as hereinafter provided. The Institutional
Accredited Investor Global Note may be represented by more than one certificate,
if so required by DTC's rules

                                       36

<PAGE>

regarding the maximum principal amount to be represented by a single
certificate. The aggregate principal amount of the Institutional Accredited
Investor Global Note may from time to time be increased or decreased by
adjustments made on the Institutional Accredited Investor Note and on the
records of the Trustee, as custodian for DTC or its nominee, as hereinafter
provided.

          Exchange Securities exchanged for interests in the Rule 144A Notes,
the Regulation S Notes and the Institutional Accredited Investor Notes will be
issued in the form of a permanent global Security, without interest coupons,
substantially in the form of Exhibit A, which is hereby incorporated by
reference and made a part of this Indenture, deposited with the Trustee as
hereinafter provided, including the appropriate legend set forth in Section
2.1(d) (the "Exchange Global Note"). The Exchange Global Note will be deposited
upon issuance with, or on behalf of, the Trustee as custodian for DTC, duly
executed by the Issuers and authenticated by the Trustee as hereinafter
provided. The Exchange Global Note may be represented by more than one
certificate, if so required by DTC's rules regarding the maximum principal
amount to be represented by a single certificate.

          The Rule 144A Global Note, the Regulation S Global Note, the
Institutional Accredited Investor Global Note and the Exchange Global Note are
sometimes collectively herein referred to as the "Global Securities."

          The principal of (and premium, if any) and interest on the Securities
shall be payable at the office or agency of each of the Issuers maintained for
such purpose in the Borough of Manhattan, The City of New York, State of New
York, or at such other office or agency of each of the Issuers as may be
maintained for such purpose pursuant to Section 2.3; provided, however, that, at
the option of each of the Issuers, each installment of interest may be paid by
(i) check mailed to addresses of the Persons entitled thereto as such addresses
shall appear on the Securities Register or (ii) wire transfer to an account
located in the United States maintained by the payee. Payments in respect of
Securities represented by a Global Security (including principal, premium, if
any, and interest) will be made by wire transfer of immediately available funds
to the accounts specified by DTC. Payments in respect of Securities represented
by Definitive Securities (including principal, premium, if any, and interest)
held by a Holder of at least $1,000,000 aggregate principal amount of Securities
represented by Definitive Securities will be made by wire transfer to a U.S.
dollar account maintained by the payee with a bank in the United States if such
Holder elects payment by wire transfer by giving written notice to the Trustee
or the Paying Agent to such effect designating such account no later than 15
days immediately preceding the relevant due date for payment (or such other date
as the Trustee may accept in its discretion).

          The Securities may have notations, legends or endorsements required by
law, stock exchange rule or usage, in addition to those set forth on Exhibit A
and in Section 2.1(d). Each of the Issuers and the Trustee shall approve the
forms of the Securities and any notation, endorsement or legend on them. Each
Security shall be dated the date of its authentication. The terms of the
Securities set forth in Exhibit A are part of the terms of this Indenture and,
to the extent applicable, each of the Issuers, the Subsidiary Guarantors and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
be bound by such terms.

                                       37

<PAGE>

          (c) Denominations. The Securities shall be issuable only in fully
registered form, without interest coupons, and only in denominations of $2,000
and integral multiples of $1,000 in excess thereof.

          (d) Restrictive Legends. Unless and until (i) an Initial Security is
sold under an effective registration statement or (ii) an Initial Security is
exchanged for an Exchange Security in connection with an effective registration
statement, in each case pursuant to the Registration Rights Agreement or a
similar agreement,

          (A) the Rule 144A Global Note and the Institutional Accredited
Investor Global Note shall bear the following legend (the "Private Placement
Legend") on the face thereof:

     THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
     AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
     OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
     HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED
     OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
     TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION. THE
     HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF
     AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED
     SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO
     THE DATE (THE "RESALE RESTRICTION TERMINATION DATE") THAT IS TWO YEARS
     AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON
     WHICH AN ISSUER OR ANY AFFILIATE OF AN ISSUER WAS THE OWNER OF THIS
     SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO AN ISSUER, (B)
     PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER
     THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR
     RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT
     REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE
     144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
     ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
     TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND
     SALES THAT OCCUR OUTSIDE THE U.S. WITHIN THE MEANING OF REGULATION S UNDER
     THE SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN
     THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT
     THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS
     OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED
     INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF
     $250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR
     SALE IN CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES
     ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
     REQUIREMENTS OF THE SECURITIES ACT,

                                       38

<PAGE>

     SUBJECT TO THE ISSUERS' AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER,
     SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE
     DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/ OR OTHER INFORMATION
     SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST
     OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.

     THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, REPRESENTS AND
     WARRANTS THAT EITHER (A) NO PORTION OF THE ASSETS USED BY SUCH HOLDER TO
     ACQUIRE AND HOLD THIS SECURITY CONSTITUTES THE ASSETS OF ANY EMPLOYEE
     BENEFIT PLAN SUBJECT TO SECTION 406 OF THE U.S. EMPLOYEE RETIREMENT INCOME
     SECURITY ACT OF 1974, AS AMENDED ("ERISA"), ANY PLAN, ACCOUNT OR OTHER
     ARRANGEMENT SUBJECT TO SECTION 4975 OF THE U.S. INTERNAL REVENUE CODE OF
     1986, AS AMENDED (THE "CODE"), OR PROVISIONS UNDER ANY FEDERAL, STATE,
     LOCAL, NON-U.S. OR OTHER LAWS OR REGULATIONS THAT ARE SIMILAR TO SUCH
     PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY, "SIMILAR LAWS") (EACH, A
     "PLAN") OR ANY ENTITY WHOSE UNDERLYING ASSETS ARE CONSIDERED TO INCLUDE
     "PLAN ASSETS" OF ANY SUCH PLAN OR (B) THE ACQUISITION AND HOLDING OF THIS
     SECURITY BY YOU WILL NOT CONSTITUTE A NON-EXEMPT PROHIBITED TRANSACTION
     UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE OR A VIOLATION UNDER
     ANY APPLICABLE SIMILAR LAW.

          (B) the Regulation S Global Note shall bear the following legend (the
"Regulation S Legend") on the face thereof:

     THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
     AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
     OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
     HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED
     OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
     TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION. THE
     HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF
     AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED
     SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO
     THE DATE (THE "RESALE RESTRICTION TERMINATION DATE") THAT IS 40 DAYS AFTER
     THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH AN
     ISSUER OR ANY AFFILIATE OF AN ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY
     PREDECESSOR OF SUCH SECURITY), ONLY (A) TO AN ISSUER, (B) PURSUANT TO A
     REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE
     SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE
     PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY

                                       39

<PAGE>

     BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER
     THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF
     A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER
     IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES
     THAT OCCUR OUTSIDE THE U.S. WITHIN THE MEANING OF REGULATION S UNDER THE
     SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE
     MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS
     AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS OWN
     ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN
     EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, FOR
     INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN
     CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F)
     PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
     OF THE SECURITIES ACT, SUBJECT TO THE ISSUERS' AND THE TRUSTEE'S RIGHT
     PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR
     (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/ OR
     OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED
     UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION
     DATE.

     THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, REPRESENTS AND
     WARRANTS THAT EITHER (A) NO PORTION OF THE ASSETS USED BY SUCH HOLDER TO
     ACQUIRE AND HOLD THIS SECURITY CONSTITUTES THE ASSETS OF ANY EMPLOYEE
     BENEFIT PLAN SUBJECT TO SECTION 406 OF THE U.S. EMPLOYEE RETIREMENT INCOME
     SECURITY ACT OF 1974, AS AMENDED ("ERISA"), ANY PLAN, ACCOUNT OR OTHER
     ARRANGEMENT SUBJECT TO SECTION 4975 OF THE U.S. INTERNAL REVENUE CODE OF
     1986, AS AMENDED (THE "CODE"), OR PROVISIONS UNDER ANY FEDERAL, STATE,
     LOCAL, NON-U.S. OR OTHER LAWS OR REGULATIONS THAT ARE SIMILAR TO SUCH
     PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY, "SIMILAR LAWS") (EACH, A
     "PLAN") OR ANY ENTITY WHOSE UNDERLYING ASSETS ARE CONSIDERED TO INCLUDE
     "PLAN ASSETS" OF ANY SUCH PLAN OR (B) THE ACQUISITION AND HOLDING OF THIS
     SECURITY BY YOU WILL NOT CONSTITUTE A NON-EXEMPT PROHIBITED TRANSACTION
     UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE OR A VIOLATION UNDER
     ANY APPLICABLE SIMILAR LAW.

          (C) Each Global Security, whether or not an Initial Security, shall
bear the following legend on the face thereof:

     UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
     DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
     YORK, TO THE COMPANY OR ITS

                                       40

<PAGE>

     AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
     CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
     NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
     PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
     AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
     FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
     REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

     TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE,
     BUT NOT IN PART, TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR
     SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY
     SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET
     FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.

          (e) Book-Entry Provisions.

          (i) This Section 2.1(e) shall apply only to Global Securities
deposited with the Trustee, as custodian for DTC.

          (ii) Each Global Security initially shall (x) be registered in the
name of DTC for such Global Security or the nominee of DTC, (y) be delivered to
the Trustee as custodian for DTC and (z) bear legends as set forth in Section
2.1(d).

          (iii) Members of, or participants in, DTC ("Agent Members") shall have
no rights under this Indenture with respect to any Global Security held on their
behalf by DTC or by the Trustee as the custodian of DTC or under such Global
Security, and DTC may be treated by the Issuers, the Trustee and any agent of
the Issuers or the Trustee as the absolute owner of such Global Security for all
purposes whatsoever. Notwithstanding the foregoing, nothing herein shall (a)
prevent the Issuers, the Trustee or any agent of the Issuers or the Trustee from
giving effect to any written certification, proxy or other authorization
furnished by DTC or (b) impair, as between DTC and its Agent Members, the
operation of customary practices of DTC governing the exercise of the rights of
a Holder of a beneficial interest in any Global Security.

          (iv) In connection with any transfer of a portion of the beneficial
interest in a Global Security pursuant to subsection (f) of this Section 2.1 to
beneficial owners who are required to hold Definitive Securities, the Securities
Custodian shall reflect on its books and records the date and a decrease in the
principal amount of such Global Security in an amount equal to the principal
amount of the beneficial interest in the Global Security to be transferred, and
each of the Issuers shall execute, and the Trustee shall authenticate and make
available for delivery, one or more Definitive Securities of like tenor and
amount.

          (v) In connection with the transfer of an entire Global Security to
beneficial owners pursuant to subsection (f) of this Section 2.1, such Global
Security shall be deemed to be surrendered to the Trustee for cancellation, and
each of the Issuers shall execute, and the Trustee

                                       41

<PAGE>

shall authenticate and make available for delivery, to each beneficial owner
identified by DTC in exchange for its beneficial interest in such Global
Security, an equal aggregate principal amount of Definitive Securities of
authorized denominations.

          (vi) The registered Holder of a Global Security may grant proxies and
otherwise authorize any person, including Agent Members and persons that may
hold interests through Agent Members, to take any action which a Holder is
entitled to take under this Indenture or the Securities.

          (vii) Any Holder of a Global Security shall, by acceptance of such
Global Security, agree that transfers of beneficial interests in such Global
Security may be effected only through a book-entry system maintained by (a) the
Holder of such Global Security (or its agent) or (b) any Holder of a beneficial
interest in such Global Security, and that ownership of a beneficial interest in
such Global Security shall be required to be reflected in a book entry.

          (f) Definitive Securities. (i) Except as provided below, owners of
beneficial interests in Global Securities will not be entitled to receive
Definitive Securities. If required to do so pursuant to any applicable law or
regulation, beneficial owners may obtain Definitive Securities in exchange for
their beneficial interests in a Global Security upon written request in
accordance with DTC's and the Registrar's procedures. In addition, Definitive
Securities shall be transferred to all beneficial owners in exchange for their
beneficial interests in a Global Security if (A) DTC notifies each of the
Issuers at any time that it is unwilling or unable to continue as depositary for
such Global Security or DTC ceases to be a clearing agency registered under the
Exchange Act, at a time when DTC is required to be so registered in order to act
as depositary, and in each case a successor depositary is not appointed by the
Issuers within 90 days of such notice or, (B) each of the Issuers in its sole
discretion executes and delivers to the Trustee and Registrar an Officers'
Certificate stating that such Global Security shall be so exchangeable or (C) an
Event of Default has occurred and is continuing and the Registrar has received a
request from DTC. In the event of the occurrence of any of the events specified
in clause (A), (B) or (C) of the preceding sentence, each of the Issuers shall
promptly make available to the Trustee a reasonable supply of Definitive
Securities in fully registered form without interest coupons.

          (ii) Any Definitive Security delivered in exchange for an interest in
a Global Security pursuant to Section 2.1(e)(iv) or (v) shall, except as
otherwise provided by Section 2.6(c), bear the applicable legend regarding
transfer restrictions applicable to the Definitive Security set forth in Section
2.1(d).

          (iii) In connection with the exchange of a portion of a Definitive
Security for a beneficial interest in a Global Security, the Trustee shall
cancel such Definitive Security, and each of the Issuers shall execute, and the
Trustee shall authenticate and make available for delivery, to the transferring
Holder a new Definitive Security representing the principal amount not so
transferred.

          SECTION 2.2. Execution and Authentication. One Officer shall sign the
Securities for each of the Issuers by manual or facsimile signature. If an
Officer whose signature

                                       42

<PAGE>

is on a Security no longer holds that office at the time the Trustee
authenticates the Security, the Security shall be valid nevertheless.

          A Security shall not be valid until an authorized signatory of the
Trustee manually authenticates the Security. The signature of the Trustee on a
Security shall be conclusive evidence that such Security has been duly and
validly authenticated and issued under this Indenture. A Security shall be dated
the date of its authentication.

          At any time and from time to time after the execution and delivery of
this Indenture, the Trustee shall authenticate and make available for delivery:
(1) Initial Securities for original issue on the Issue Date in an aggregate
principal amount of $150,000,000, (2) subject to the terms of this Indenture,
Additional Securities for original issue in an unlimited principal amount and
(3) Exchange Securities for issue only in a registered exchange offer or upon
resale under an effective Shelf Registration Statement, and only in exchange for
Initial Securities or Additional Securities of an equal principal amount, in
each case upon a written order of the Issuers signed by two Officers of each of
the Issuers (the "Company Order"). Such Company Order shall specify whether the
Securities will be in the form of Definitive Securities or Global Securities,
the amount of the Securities to be authenticated and the date on which the
original issue of Securities is to be authenticated and whether the Securities
are to be Initial Securities, Additional Securities or Exchange Securities.

          The Trustee may appoint an agent (the "Authenticating Agent")
reasonably acceptable to each of the Issuers to authenticate the Securities. Any
such instrument shall be evidenced by an instrument signed by a Trust Officer, a
copy of which shall be furnished to each of the Issuers. Unless limited by the
terms of such appointment, any such Authenticating Agent may authenticate
Securities whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by the Authenticating
Agent. An Authenticating Agent has the same rights as any Registrar, Paying
Agent or agent for service of notices and demands.

          In case any of the Issuers, pursuant to Article IV, shall be
consolidated or merged with or into any other Person or shall convey, transfer,
lease or otherwise dispose of its properties and assets substantially as an
entirety to any Person, and the successor Person resulting from such
consolidation, or surviving such merger, or into which any of the Issuers shall
have been merged, or the Person which shall have received a conveyance,
transfer, lease or other disposition as aforesaid, shall have executed an
indenture supplemental hereto with the Trustee pursuant to Article IV, any of
the Securities authenticated or delivered prior to such consolidation, merger,
conveyance, transfer, lease or other disposition may, from time to time, at the
request of the successor Person, be exchanged for other Securities executed in
the name of the successor Person with such changes in phraseology and form as
may be appropriate, but otherwise in substance of like tenor as the Securities
surrendered for such exchange and of like principal amount; and the Trustee,
upon Company Order of the successor Person, shall authenticate and make
available for delivery Securities as specified in such order for the purpose of
such exchange. If Securities shall at any time be authenticated and delivered in
any new name of a successor Person pursuant to this Section 2.2 in exchange or
substitution for or upon registration of transfer of any Securities, such
successor Person, at the option of the Holders but

                                       43

<PAGE>

without expense to them, shall provide for the exchange of all Securities at the
time outstanding for Securities authenticated and delivered in such new name.

          SECTION 2.3. Registrar and Paying Agent. Each of the Issuers shall
maintain an office or agency where Securities may be presented for registration
of transfer or for exchange (the "Registrar") and an office or agency where
Securities may be presented for payment (the "Paying Agent"). Each of the
Issuers shall cause each of the Registrar and the Paying Agent to maintain an
office or agency. The Registrar shall keep a register of the Securities and of
their transfer and exchange (the "Securities Register"). Each of the Issuers may
have one or more co-registrars and one or more additional paying agents. The
term "Paying Agent" includes any additional paying agent and the term
"Registrar" includes any co-registrar.

          Each of the Issuers shall enter into an appropriate agency agreement
with any Registrar or Paying Agent not a party to this Indenture, which shall
incorporate the terms of the TIA. The agreement shall implement the provisions
of this Indenture that relate to such agent. The Issuers shall notify the
Trustee of the name and address of each such agent. If any of the Issuers fails
to maintain a Registrar or Paying Agent, the Trustee shall act as such and shall
be entitled to appropriate compensation therefor pursuant to Section 7.7. Any of
the Issuers' Wholly-Owned Subsidiaries organized in the United States may act as
Paying Agent or Registrar.

          Each of the Issuers initially appoint the Trustee as Registrar and
Paying Agent for the Securities. The Issuers may remove any Registrar or Paying
Agent upon written notice to such Registrar or Paying Agent and to the Trustee;
provided, however, that no such removal shall become effective until (i)
acceptance of any appointment by a successor as evidenced by an appropriate
agreement entered into by the Issuers and such successor Registrar or Paying
Agent, as the case may be, and delivered to the Trustee or (ii) notification to
the Trustee that the Trustee shall serve as Registrar or Paying Agent until the
appointment of a successor in accordance with clause (i) above. The Registrar or
Paying Agent may resign at any time upon written notice to the Issuers and the
Trustee.

          SECTION 2.4. Paying Agent to Hold Money in Trust. By no later than
10:00 a.m. (New York City time) on the date on which any principal of, premium,
if any, or interest on any Security is due and payable, the Company shall
deposit with the Paying Agent a sum sufficient in immediately available funds to
pay such principal, premium, if any, or interest when due. The Company shall
require each Paying Agent (other than the Trustee) to agree in writing that such
Paying Agent shall hold in trust for the benefit of Securityholders or the
Trustee all money held by such Paying Agent for the payment of principal,
premium, if any, of or interest on the Securities (whether such assets have been
distributed to it by the Company or other obligors on the Securities) and shall
notify the Trustee in writing of any default by the Company or any Subsidiary
Guarantor in making any such payment. If any of the Issuers or a Subsidiary
Guarantor of the Company acts as Paying Agent, it shall segregate the money held
by it as Paying Agent and hold it as a separate trust fund. The Company at any
time may require a Paying Agent (other than the Trustee) to pay all money held
by it to the Trustee and to account for any funds or assets disbursed by such
Paying Agent. Upon complying with this Section, the Paying Agent shall have no
further liability for the money delivered to the Trustee. Upon any

                                       44

<PAGE>

bankruptcy, reorganization or similar proceeding with respect to any of the
Issuers, the Trustee shall serve as Paying Agent for the Securities.

          SECTION 2.5. Securityholder Lists. The Trustee shall preserve in as
current a form as is reasonably practicable the most recent list available to it
of the names and addresses of Securityholders and shall otherwise comply with
TIA Section 312(a). If the Trustee is not the Registrar, or to the extent
otherwise required under the TIA, the Company shall furnish or cause the
Registrar to furnish to the Trustee, in writing at least five Business Days
before each interest payment date and at such other times as the Trustee may
request in writing, a list in such form and as of such date as the Trustee may
reasonably require of the names and addresses of Securityholders and the Issuers
shall otherwise comply with TIA Section 312(a).

          SECTION 2.6. Transfer and Exchange.

          (a) The following provisions shall apply with respect to any proposed
transfer of a Rule 144A Note or an Institutional Accredited Investor Note prior
to the date which is two years after the later of the date of its original issue
and the last date on which the Issuers or any Affiliate of the Issuers was the
owner of such Securities (or any predecessor thereto) (the "Resale Restriction
Termination Date"):

          (i) a transfer of a Rule 144A Note or an Institutional Accredited
     Investor Note or a beneficial interest therein to a QIB shall be made upon
     the representation of the transferee, in the form of assignment as set
     forth on the reverse of the Security, that it is purchasing the Security
     for its own account or an account with respect to which it exercises sole
     investment discretion and that it and any such account is a "qualified
     institutional buyer" within the meaning of Rule 144A, and is aware that the
     sale to it is being made in reliance on Rule 144A and acknowledges that it
     has received such information regarding the Issuers as the undersigned has
     requested pursuant to Rule 144A or has determined not to request such
     information and that it is aware that the transferor is relying upon its
     foregoing representations in order to claim the exemption from registration
     provided by Rule 144A;

          (ii) a transfer of a Rule 144A Note or an Institutional Accredited
     Investor Note or a beneficial interest therein to an IAI shall be made upon
     receipt by the Trustee or its agent of a certificate substantially in the
     form set forth in Section 2.7 from the proposed transferee and, if
     requested by any of the Issuers or the Trustee, the receipt by the Trustee
     or its agent of an opinion of counsel, certification and/or other
     information satisfactory to each of them; and

          (iii) a transfer of a Rule 144A Note or an Institutional Accredited
     Investor Note or a beneficial interest therein to a Non-U.S. Person shall
     be made upon receipt by the Trustee or its agent of a certificate
     substantially in the form set forth in Section 2.8 from the proposed
     transferee and, if requested by any of the Issuers or the Trustee, the
     delivery of an opinion of counsel, certification and/or other information
     satisfactory to each of them.

                                       45

<PAGE>

          (b) The following provisions shall apply with respect to any proposed
transfer of a Regulation S Note prior to the expiration of the Restricted
Period:

          (i) a transfer of a Regulation S Note or a beneficial interest therein
     to a QIB shall be made upon the representation of the transferee, in the
     form of assignment as set forth on the reverse of the Security, that it is
     purchasing the Security for its own account or an account with respect to
     which it exercises sole investment discretion and that it and any such
     account is a "qualified institutional buyer" within the meaning of Rule
     144A, and is aware that the sale to it is being made in reliance on Rule
     144A and acknowledges that it has received such information regarding the
     Issuers as the undersigned has requested pursuant to Rule 144A or has
     determined not to request such information and that it is aware that the
     transferor is relying upon its foregoing representations in order to claim
     the exemption from registration provided by Rule 144A;

          (ii) a transfer of a Regulation S Note or a beneficial interest
     therein to an IAI shall be made upon receipt by the Trustee or its agent of
     a certificate substantially in the form set forth in Section 2.7 from the
     proposed transferee and, if requested by any of the Issuers or the Trustee,
     the delivery of an opinion of counsel, certification and/or other
     information satisfactory to each of them; and

          (iii) a transfer of a Regulation S Note or a beneficial interest
     therein to a Non-U.S. Person shall be made in accordance with applicable
     law and pursuant to the Regulation S Legend upon receipt by the Trustee or
     its agent of a certificate substantially in the form set forth in Section
     2.8 hereof from the proposed transferee and, if requested by any of the
     Issuers or the Trustee, receipt by the Trustee or its agent of an opinion
     of counsel, certification and/or other information satisfactory to each of
     them.

          After the expiration of the Restricted Period, interests in the
Regulation S Note may be transferred in accordance with applicable law without
requiring the certifications set forth in Section 2.7 or 2.8 or any additional
certification.

          (c) Restricted Securities Legend. Upon the transfer, exchange or
replacement of Securities not bearing a Restricted Securities Legend, the
Registrar shall deliver Securities that do not bear a Restricted Securities
Legend. Upon the transfer, exchange or replacement of Securities bearing a
Restricted Securities Legend, the Registrar shall deliver only Securities that
bear a Restricted Securities Legend unless, (i) Initial Securities are being
exchanged for Exchange Securities in a registered exchange offer in which case
the Exchange Securities shall not bear a Restricted Securities Legend, (ii) an
Initial Security is being transferred pursuant to the Shelf Registration
Statement or other effective registration statement or (iii) there is delivered
to the Registrar an Opinion of Counsel reasonably satisfactory to the Company
and the Trustee to the effect that neither such legend nor the related
restrictions on transfer are required in order to maintain compliance with the
provisions of the Securities Act. Any Additional Securities sold in a registered
offering shall not be required to bear the Restricted Securities Legend.

          (d) The Registrar shall retain copies of all letters, notices and
other written communications received pursuant to Section 2.1 or this Section
2.6. The Issuers shall have the

                                       46

<PAGE>

right to inspect and make copies of all such letters, notices or other written
communications at any reasonable time upon the giving of reasonable prior
written notice to the Registrar.

          (e) Obligations with Respect to Transfers and Exchanges of Securities.

          (i) To permit registrations of transfers and exchanges, each of the
     Issuers shall, subject to the other terms and conditions of this Article
     II, execute, and the Trustee shall authenticate, Definitive Securities and
     Global Securities at the Registrar's request.

          (ii) No service charge shall be made to a Holder for any registration
     of transfer or exchange, but the Issuers may require the Holder to pay a
     sum sufficient to cover any transfer tax, assessments, or similar
     governmental charge payable in connection therewith (other than any such
     transfer taxes, assessments or similar governmental charges payable upon
     exchange or transfer pursuant to Sections 2.6 or 9.5).

          (iii) The Issuers (and the Registrar) shall not be required to
     register the transfer of or exchange of any Security for a period beginning
     (1) 15 days before the mailing of a notice of an offer to repurchase or
     redeem Securities and ending at the close of business on the day of such
     mailing or (2) 15 days before an interest payment date and ending on such
     interest payment date.

          (iv) Prior to the due presentation for registration of transfer of any
     Security, each of the Issuers, the Trustee, the Paying Agent or the
     Registrar may deem and treat the person in whose name a Security is
     registered as the absolute owner of such Security for the purpose of
     receiving payment of principal of, premium, if any, and interest on such
     Security and for all other purposes whatsoever, including without
     limitation the transfer or exchange of such Security, whether or not such
     Security is overdue, and none of the Issuers, the Trustee, the Paying Agent
     or the Registrar shall be affected by notice to the contrary.

          (v) Any Definitive Security delivered in exchange for an interest in a
     Global Security pursuant to Section 2.1(e) shall, except as otherwise
     provided by Section 2.6(c), bear the applicable legend regarding transfer
     restrictions applicable to the Definitive Security set forth in Section
     2.1(d).

          (vi) All Securities issued upon any transfer or exchange pursuant to
     the terms of this Indenture shall evidence the same debt and shall be
     entitled to the same benefits under this Indenture as the Securities
     surrendered upon such transfer or exchange.

          (f) No Obligation of the Trustee.

          (i) The Trustee shall have no responsibility or obligation to any
beneficial owner of a Global Security, a member of, or a participant in, DTC or
other Person with respect to the accuracy of the records of DTC or its nominee
or of any participant or member thereof, with respect to any ownership interest
in the Securities or with respect to the delivery to any participant, member,
beneficial owner or other Person (other than DTC) of any notice (including any
notice of redemption) or the payment of any amount or delivery of any Securities
(or other

                                       47

<PAGE>

security or property) under or with respect to such Securities. All notices and
communications to be given to the Holders and all payments to be made to Holders
in respect of the Securities shall be given or made only to or upon the order of
the registered Holders (which shall be DTC or its nominee in the case of a
Global Security). The rights of beneficial owners in any Global Security shall
be exercised only through DTC subject to the applicable rules and procedures of
DTC. The Trustee may rely and shall be fully protected in relying upon
information furnished by DTC with respect to its members, participants and any
beneficial owners.

          (ii) The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer imposed
under this Indenture or under applicable law with respect to any transfer of any
interest in any Security (including any transfers between or among DTC
participants, members or beneficial owners in any Global Security) other than to
require delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by, the terms
of this Indenture or reasonably requested by the Issuers, and to examine the
same to determine substantial compliance as to form with the express
requirements hereof.

          SECTION 2.7. Form of Certificate to be Delivered in Connection with
Transfers to IAIs.

                                     [Date]

Wells Fargo Bank, National Association
Sixth and Marquette
MAC N9303-120
Minneapolis, MN 55479

Attention: Corporate Trust Services

     Re: Stewart & Stevenson LLC
         Stewart & Stevenson Corp.
         10% Senior Notes due 2014

Ladies and Gentlemen:

          This certificate is delivered to request a transfer of $[_________]
principal amount of the 10% Senior Notes due 2014 (the "Securities") of Stewart
& Stevenson LLC and Stewart & Stevenson Corp. (the "Issuers").

          Upon transfer, the Securities would be registered in the name of the
new beneficial owner as follows:

          Name: ____________________________________________

          Address: _________________________________________

                                       48

<PAGE>

          Taxpayer ID Number: ______________________________

          The undersigned represents and warrants to you that:

          1. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended (the
"Securities Act")), purchasing for our own account or for the account of such an
institutional "accredited investor" at least $250,000 principal amount of the
Securities, and we are acquiring the Securities not with a view to, or for offer
or sale in connection with, any distribution in violation of the Securities Act.
We have such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risk of our investment in the Securities
and we invest in or purchase securities similar to the Securities in the normal
course of our business. We and any accounts for which we are acting are each
able to bear the economic risk of our or its investment.

          2. We understand that the Securities have not been registered under
the Securities Act and, unless so registered, may not be sold except as
permitted in the following sentence. We agree on our own behalf and on behalf of
any investor account for which we are purchasing Securities to offer, sell or
otherwise transfer such Securities prior to the date that is two years after the
later of the date of original issue and the last date on which the Issuers or
any affiliate of any of the Issuers was the owner of such Securities (or any
predecessor thereto) (the "Resale Restriction Termination Date") only (a) to the
Issuers, (b) pursuant to a registration statement that has been declared
effective under the Securities Act, (c) in a transaction complying with the
requirements of Rule 144A under the Securities Act, to a person we reasonably
believe is a "qualified institutional buyer" under Rule 144A of the Securities
Act (a "QIB") that is purchasing for its own account or for the account of a QIB
and to whom notice is given that the transfer is being made in reliance on Rule
144A, (d) pursuant to offers and sales that occur outside the United States
within the meaning of Regulation S under the Securities Act, (e) to an
institutional "accredited investor" within the meaning of Rule 501(a)(1), (2),
(3) or (7) under the Securities Act that is purchasing for its own account or
for the account of such an institutional "accredited investor," in each case in
a minimum principal amount of Securities of $250,000, for investment purposes
and not with a view to or for offer or sale in connection with any distribution
in violation of the Securities Act or (f) pursuant to any other available
exemption from the registration requirements of the Securities Act, subject in
each of the foregoing cases to any requirement of law that the disposition of
our property or the property of such investor account or accounts be at all
times within our or their control and in compliance with any applicable state
securities laws. The foregoing restrictions on resale will not apply subsequent
to the Resale Restriction Termination Date. If any resale or other transfer of
the Securities is proposed to be made pursuant to clause (e) above prior to the
Resale Restriction Termination Date, the transferor shall deliver a letter from
the transferee substantially in the form of this letter to the Issuers and Wells
Fargo Bank, National Association, as Trustee (the "Trustee"), which shall
provide, among other things, that the transferee is an institutional "accredited
investor" (within the meaning of Rule 501(a)(1), (2), (3) or (7) under the
Securities Act) and that it is acquiring such Securities for investment purposes
and not for distribution in violation of the Securities Act and other matters
discussed in this letter. Each purchaser acknowledges that the Issuers and the
Trustee reserve the right prior to any offer, sale or other transfer prior to
the Resale Restriction Termination Date of the Securities pursuant to clauses
(d), (e) or (f) above to

                                       49

<PAGE>

require the delivery of an opinion of counsel, certifications and/or other
information satisfactory to each of the Issuers and the Trustee.

          The Trustee and each of the Issuers are entitled to rely upon this
letter and are irrevocably authorized to produce this letter or a copy hereof to
any interested party in any administrative or legal proceedings or official
inquiry with respect to the matters covered hereby.

                                        TRANSFEREE:
                                                    ----------------------------

                                        BY:
                                            ------------------------------------

cc: Stewart & Stevenson LLC
    Stewart & Stevenson Corp.

          SECTION 2.8. Form of Certificate to be Delivered in Connection with
Transfers Pursuant to Regulation S.

                                     [Date]

Wells Fargo Bank, National Association
Sixth and Marquette
MAC N9303-120
Minneapolis, MN 55479

Attention: Corporate Trust Services

     Re: Stewart & Stevenson LLC
         Stewart & Stevenson Corp.
         10% Senior Notes due 2014

Ladies and Gentlemen:

          In connection with our proposed sale of $[__________] aggregate
principal amount of the 10% Senior Notes due 2014 (the "Securities") of Stewart
& Stevenson LLC and Stewart & Stevenson Corp. (the "Issuers"), we confirm that
such sale has been effected pursuant to and in accordance with Regulation S
under the United States Securities Act of 1933, as amended (the "Securities
Act"), and, accordingly, we represent that:

          (a) the offer of the Securities was not made to a person in the United
     States or to a U.S. person;

          (b) either (i) at the time the buy order was originated, the
     transferee was outside the United States or we and any person acting on our
     behalf reasonably believed that the transferee was outside the United
     States or (ii) the transaction was executed in, on

                                       50

<PAGE>

     or through the facilities of a designated off-shore securities market and
     neither we nor any person acting on our behalf knows that the transaction
     has been pre-arranged with a buyer in the United States;

          (c) no directed selling efforts have been made in the United States in
     contravention of the requirements of Rule 903(a)(2) or Rule 904(a)(2) of
     Regulation S, as applicable; and

          (d) the transaction is not part of a plan or scheme to evade the
     registration requirements of the Securities Act.

          In addition, if the sale is made during a restricted period and the
provisions of Rule 903(b)(2) or Rule 904(b)(1) of Regulation S are applicable
thereto, we confirm that such sale has been made in accordance with the
applicable provisions of Rule 903(b)(2) or Rule 904(b)(1), as the case may be.

          Wells Fargo Bank, National Association, as Trustee, and the Issuers
are entitled to rely upon this letter and are irrevocably authorized to produce
this letter or a copy hereof to any interested party in any administrative or
legal proceedings or official inquiry with respect to the matters covered
hereby. Terms used in this certificate have the meanings set forth in Regulation
S.

Very truly yours,

[Name of Transferor]

By:
    ---------------------------------

-------------------------------------
         Authorized Signature

cc: Stewart & Stevenson LLC
    Stewart & Stevenson Corp.

          SECTION 2.9. Mutilated, Destroyed, Lost or Stolen Securities. If a
mutilated Security is surrendered to the Registrar or if the Holder of a
Security claims that the Security has been lost, destroyed or wrongfully taken,
the Issuers shall issue and the Trustee shall authenticate a replacement
Security if the requirements of Section 8-405 of the Uniform Commercial Code are
met, such that the Securityholder (a) notifies the Issuers or the Trustee within
a reasonable time after such Securityholder has notice of such loss, destruction
or wrongful taking and the Registrar has not registered a transfer prior to
receiving such notification, (b) makes such request to the Issuers or Trustee
prior to the Security being acquired by a protected purchaser as defined in
Section 8-303 of the Uniform Commercial Code (a "protected purchaser") and (c)
satisfies any other reasonable requirements of the Trustee and the Issuers. If
required by the Trustee or the Issuers, such Holder shall furnish an indemnity
bond sufficient in the judgment of the Issuers and the Trustee to protect the
Issuers, the Trustee, the Paying Agent and the Registrar from any loss

                                       51

<PAGE>

which any of them may suffer if a Security is replaced, and, in the absence of
notice to the Issuers, any Subsidiary Guarantor or the Trustee that such
Security has been acquired by a bona fide purchaser, the Issuers shall execute
and, upon receipt of a Company Order, the Trustee shall authenticate and make
available for delivery, in exchange for any such mutilated Security or in lieu
of any such destroyed, lost or stolen Security, a new Security of like tenor and
principal amount, bearing a number not contemporaneously outstanding.

          In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Issuers in their discretion
may, instead of issuing a new Security, pay such Security.

          Upon the issuance of any new Security under this Section, the Issuers
may require that such Holder pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of counsel and of the Trustee) in
connection therewith.

          Every new Security issued pursuant to this Section in lieu of any
mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Issuers, any Subsidiary Guarantor (if
applicable) and any other obligor upon the Securities, whether or not the
mutilated, destroyed, lost or stolen Security shall be at any time enforceable
by anyone, and shall be entitled to all benefits of this Indenture equally and
proportionately with any and all other Securities duly issued hereunder.

          The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.

          SECTION 2.10. Outstanding Securities. Securities outstanding at any
time are all Securities authenticated by the Trustee except for those cancelled
by it, those delivered to it for cancellation and those described in this
Section as not outstanding. A Security does not cease to be outstanding in the
event either of the Issuers or an Affiliate of the Issuers holds the Security,
provided, however, that (i) for purposes of determining which are outstanding
for consent or voting purposes hereunder, the provisions of Section 11.6 shall
apply and (ii) in determining whether the Trustee shall be protected in making a
determination whether the Holders of the requisite principal amount of
outstanding Securities are present at a meeting of Holders of Securities for
quorum purposes or have consented to or voted in favor of any request, demand,
authorization, direction, notice, consent, waiver, amendment or modification
hereunder, or relying upon any such quorum, consent or vote, only Securities
which a Trust Officer of the Trustee actually knows to be held by the Issuers or
an Affiliate of any of the Issuers shall not be considered outstanding.

          If a Security is replaced pursuant to Section 2.9 (other than a
mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee and the Issuers receive proof satisfactory to them that the
replaced Security is held by a protected purchaser. A mutilated Security ceases
to be outstanding upon surrender of such Security and replacement pursuant to
Section 2.9.

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          If the Paying Agent segregates and holds in trust, in accordance with
this Indenture, on a Redemption Date or maturity date money sufficient to pay
all principal, premium, if any, and accrued interest payable on that date with
respect to the Securities (or portions thereof) to be redeemed or maturing, as
the case may be, and the Paying Agent is not prohibited from paying such money
to the Securityholders on that date pursuant to the terms of this Indenture,
then on and after that date such Securities (or portions thereof) cease to be
outstanding and interest on them ceases to accrue.

          SECTION 2.11. Temporary Securities. In the event that Definitive
Securities are to be issued under the terms of this Indenture, until such
Definitive Securities are ready for delivery, the Issuers may prepare and the
Trustee shall authenticate temporary Securities. Temporary Securities shall be
substantially in the form, and shall carry all rights, of Definitive Securities
but may have variations that the Issuers consider appropriate for temporary
Securities. Without unreasonable delay, the Issuers shall prepare and the
Trustee shall authenticate Definitive Securities. After the preparation of
Definitive Securities, the temporary Securities shall be exchangeable for
Definitive Securities upon surrender of the temporary Securities at any office
or agency maintained by the Issuers for that purpose and such exchange shall be
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities, the Issuers shall execute, and the Trustee shall
authenticate and make available for delivery in exchange therefor, one or more
Definitive Securities representing an equal principal amount of Securities.
Until so exchanged, the Holder of temporary Securities shall in all respects be
entitled to the same benefits under this Indenture as a Holder of Definitive
Securities.

          SECTION 2.12. Cancellation. The Issuers at any time may deliver
Securities to the Trustee for cancellation. The Registrar and the Paying Agent
shall forward to the Trustee any Securities surrendered to them for registration
of transfer, exchange or payment. The Trustee and no one else shall cancel all
Securities surrendered for registration of transfer, exchange, payment or
cancellation and dispose of such Securities (subject to the record retention
requirements of the Exchange Act) in accordance with its internal policies and
customary procedures. If any of the Issuers or any Subsidiary Guarantor acquires
any of the Securities, such acquisition shall not operate as a redemption or
satisfaction of the Indebtedness represented by such Securities unless and until
the same are surrendered to the Trustee for cancellation pursuant to this
Section 2.12. Except as provided in Section 2.9, each of the Issuers may not
issue new Securities to replace Securities it has paid or delivered to the
Trustee for cancellation for any reason other than in connection with a transfer
or exchange.

          At such time as all beneficial interests in a Global Security have
either been exchanged for Definitive Securities, transferred, redeemed,
repurchased or canceled, such Global Security shall be returned by DTC to the
Trustee for cancellation or retained and canceled by the Trustee. At any time
prior to such cancellation, if any beneficial interest in a Global Security is
exchanged for Definitive Securities, transferred in exchange for an interest in
another Global Security, redeemed, repurchased or canceled, the principal amount
of Securities represented by such Global Security shall be reduced and an
adjustment shall be made on the books and records of the Trustee (if it is then
the Securities Custodian for such Global Security) with respect to such Global
Security, by the Trustee or the Securities Custodian, to reflect such reduction.

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          SECTION 2.13. Payment of Interest; Defaulted Interest. Interest on any
Security which is payable, and is punctually paid or duly provided for, on any
interest payment date shall be paid to the Person in whose name such Security
(or one or more predecessor Securities) is registered at the close of business
on the regular record date for such payment at the office or agency of the
Company maintained for such purpose pursuant to Section 2.3.

          Any interest on any Security which is payable, but is not paid when
the same becomes due and payable and such nonpayment continues for a period of
30 days shall forthwith cease to be payable to the Holder on the regular record
date, and such defaulted interest and (to the extent lawful) interest on such
defaulted interest at the rate borne by the Securities (such defaulted interest
and interest thereon herein collectively called "Defaulted Interest") shall be
paid by the Issuers, at its election in each case, as provided in clause (a) or
(b) below:

          (a) The Company may elect to make payment of any Defaulted Interest to
     the Persons in whose names the Securities (or their respective predecessor
     Securities) are registered at the close of business on a Special Record
     Date (as defined below) for the payment of such Defaulted Interest, which
     shall be fixed in the following manner. The Company shall notify the
     Trustee in writing of the amount of Defaulted Interest proposed to be paid
     on each Security and the date (not less than 30 days after such notice) of
     the proposed payment (the "Special Interest Payment Date"), and at the same
     time the Company shall deposit with the Trustee an amount of money equal to
     the aggregate amount proposed to be paid in respect of such Defaulted
     Interest or shall make arrangements satisfactory to the Trustee for such
     deposit prior to the date of the proposed payment, such money when
     deposited to be held in trust for the benefit of the Persons entitled to
     such Defaulted Interest as in this clause provided. Thereupon the Trustee
     shall fix a record date (the "Special Record Date") for the payment of such
     Defaulted Interest, which date shall be not more than 15 days and not less
     than 10 days prior to the Special Interest Payment Date and not less than
     10 days after the receipt by the Trustee of the notice of the proposed
     payment. The Trustee shall promptly notify the Issuers of such Special
     Record Date, and in the name and at the expense of the Issuers, shall cause
     notice of the proposed payment of such Defaulted Interest and the Special
     Record Date and Special Interest Payment Date therefor to be given in the
     manner provided for in Section 11.2, not less than 10 days prior to such
     Special Record Date. Notice of the proposed payment of such Defaulted
     Interest and the Special Record Date and Special Interest Payment Date
     therefor having been so given, such Defaulted Interest shall be paid on the
     Special Interest Payment Date to the Persons in whose names the Securities
     (or their respective predecessor Securities) are registered at the close of
     business on such Special Record Date and shall no longer be payable
     pursuant to the following clause (b).

          (b) The Company may make payment of any Defaulted Interest in any
     other lawful manner not inconsistent with the requirements of any
     securities exchange on which the Securities may be listed, and upon such
     notice as may be required by such exchange, if, after notice given by the
     Issuers to the Trustee of the proposed payment pursuant to this clause,
     such manner of payment shall be deemed practicable by the Trustee.

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          Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of, transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.

          SECTION 2.14. Computation of Interest. Interest on the Securities
shall be computed on the basis of a 360-day year of twelve 30-day months.

          SECTION 2.15. CUSIP, Common Code and ISIN Numbers. The Issuers in
issuing the Securities may use "CUSIP," "Common Code" or "ISIN" numbers and, if
so, the Trustee shall use "CUSIP," "Common Code" or "ISIN" numbers in notices of
redemption or purchase as a convenience to Holders; provided, however, that any
such notice may state that no representation is made as to the correctness of
such numbers either as printed on the Securities or as contained in any notice
of a redemption or purchase and that reliance may be placed only on the other
identification numbers printed on the Securities, and any such redemption or
purchase shall not be affected by any defect in or omission of such CUSIP,
Common Code or ISIN number. The Issuers shall promptly notify the Trustee in
writing of any change in the CUSIP, Common Code or ISIN number.

                                  ARTICLE III
                                   COVENANTS

          SECTION 3.1. Payment of Securities. The Issuers shall promptly pay the
principal of, premium, if any, and interest on the Securities on the dates and
in the manner provided in the Securities and in this Indenture. Principal,
premium, if any, and interest shall be considered paid on the date due if on
such date the Trustee or the Paying Agent holds in accordance with this
Indenture immediately available funds sufficient to pay all principal, premium,
if any, and interest then due and the Trustee or the Paying Agent, as the case
may be, is not prohibited from paying such money to the Securityholders on that
date pursuant to the terms of this Indenture.

          The Issuers shall pay interest on overdue principal at the rate
specified therefor in the Securities, and it shall pay interest on overdue
installments of interest at the same rate to the extent lawful.

          The Issuers and the Subsidiary Guarantors will pay any present or
future stamp, court or documentary taxes or any other excise or property taxes,
charges or similar levies that arise in any jurisdiction from the execution,
delivery, enforcement or registration of the Securities, the Subsidiary
Guarantees, this Indenture or any other document or instrument in relation
thereof, or the receipt of any payments with respect to the Securities or the
Subsidiary Guarantees, excluding such taxes, charges or similar levies imposed
by any jurisdiction outside of the United States, the jurisdiction of
incorporation of any successor of any of the Issuers or any Subsidiary Guarantor
or any jurisdiction in which a paying agent is located, other than those
resulting from, or required to be paid in connection with, the enforcement of
the Securities, the Subsidiary Guarantees or any other such document or
instrument following the occurrence of

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<PAGE>

any Event of Default with respect to the Securities. The Issuers or the
Subsidiary Guarantors will agree to indemnify the Holders for any such taxes
paid by such Holders.

          Notwithstanding anything to the contrary contained in this Indenture,
the Issuers or any Subsidiary Guarantor may, to the extent it is required to do
so by law, deduct or withhold income or other similar taxes imposed by the
United States of America from principal, premium or interest payments hereunder.

          SECTION 3.2. Limitation on Indebtedness. The Company will not, and
will not permit any of its Restricted Subsidiaries to, Incur any Indebtedness
(including Acquired Indebtedness); provided, however, that the Company and the
Restricted Subsidiaries may Incur Indebtedness if on the date thereof:

          (1)  (a) on or prior to June 30, 2008, the Consolidated Coverage Ratio
               for the Company and its Restricted Subsidiaries is at least 2.00
               to 1.00; and (b) thereafter the Consolidated Coverage Ratio for
               the Company and its Restricted Subsidiaries is at least 2.50 to
               1.00; and

          (2)  no Event of Default will have occurred or be continuing or would
               occur as a consequence of Incurring the Indebtedness or
               transactions relating to such Incurrence.

          The first paragraph of this covenant will not prohibit the Incurrence
of the following Indebtedness:

          (1)  Indebtedness of the Company or any Subsidiary Guarantor Incurred
               pursuant to a Credit Facility in an aggregate amount up to the
               greater of (a) the Borrowing Base and (b) $125 million less the
               aggregate principal amount of all scheduled principal repayments
               unless refinanced on the date of such repayment under this clause
               (1) and all mandatory prepayments (including with the proceeds of
               asset dispositions) of principal thereof permanently reducing the
               commitments thereunder;

          (2)  Guarantees by (x) the Company or Restricted Subsidiaries of
               Indebtedness Incurred by the Company or a Restricted Subsidiary
               in accordance with the provisions of this Indenture, provided
               that in the event such Indebtedness that is being Guaranteed is a
               Subordinated Obligation or a Guarantor Subordinated Obligation,
               then the related Guarantee shall be subordinated in right of
               payment to the Securities or the Subsidiary Guarantee, as the
               case may be;

          (3)  Indebtedness of the Company owing to and held by any Restricted
               Subsidiary or Indebtedness of a Restricted Subsidiary owing to
               and held by the Company or any Restricted Subsidiary; provided,
               however:

               (a)  if the Company is the obligor on such Indebtedness and a
                    Sub-Guarantor is not the obligee, such Indebtedness is
                    expressly

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                    subordinated to the prior payment in full in cash of all
                    obligations with respect to the Securities; and

               (b)  if a Subsidiary Guarantor is the obligor on such
                    Indebtedness and the Company or a Subsidiary Guarantor is
                    not the obligee, such Indebtedness is subordinated in right
                    of payment to the Subsidiary Guarantee of such Subsidiary
                    Guarantor; and

               (c)  (i)  any subsequent issuance or transfer of Capital Stock or
                         any other event which results in any such Indebtedness
                         being beneficially held by a Person other than the
                         Company or a Restricted Subsidiary of the Company; and

                    (ii) any sale or other transfer of any such Indebtedness to
                         a Person other than the Company or a Restricted
                         Subsidiary of the Company

shall be deemed, in each case, to constitute an Incurrence of such Indebtedness
by the Company or such Subsidiary, as the case may be.

          (4)  Indebtedness represented by (a) the Securities issued on the
               Issue Date, the Subsidiary Guarantees and the related Exchange
               Securities and exchange guarantees issued pursuant to the
               Registration Rights Agreement, (b) any Indebtedness (other than
               the Indebtedness described in clauses (1), (2), (3), (6), (8),
               (9), (10) and (11) of this paragraph) outstanding on the Issue
               Date and (c) any Refinancing Indebtedness Incurred in respect of
               any Indebtedness described in this clause (4) or clause (5) of
               this paragraph or Incurred pursuant to the first paragraph of
               this covenant;

          (5)  Indebtedness of a Restricted Subsidiary Incurred and outstanding
               on the date on which such Restricted Subsidiary is acquired by,
               or merged into, the Company or any Restricted Subsidiary (other
               than Indebtedness Incurred (a) to provide all or any portion of
               the funds utilized to consummate the transaction or series of
               related transactions pursuant to which such Restricted Subsidiary
               became a Restricted Subsidiary or was otherwise acquired by the
               Company or (b) otherwise in connection with, or in contemplation
               of, such acquisition); provided, however, that at the time such
               Restricted Subsidiary is acquired by the Company, the Company
               would have been able to Incur $1.00 of additional Indebtedness
               pursuant to the first paragraph of this covenant, or the
               Consolidated Coverage Ratio would be improved, after giving
               effect to the Incurrence of such Indebtedness pursuant to this
               clause (5);

          (6)  Indebtedness under Hedging Obligations (including related letters
               of credit) that are Incurred in the ordinary course of business
               (and not for speculative purposes) (1) for the purpose of fixing
               or hedging interest rate risk with respect to any Indebtedness
               Incurred in accordance with this

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               Indenture; (2) for the purpose of fixing or hedging currency
               exchange rate risk with respect to any currency exchanges; or (3)
               for the purpose of fixing or hedging commodity price risk with
               respect to any commodities;

          (7)  the Incurrence by the Company or any of its Restricted
               Subsidiaries of Indebtedness represented by Capitalized Lease
               Obligations, mortgage financings, purchase money obligations or
               other payments, in each case Incurred to finance all or any part
               of the purchase price or cost of construction or improvement of
               assets or property, including design, development and
               installation, personal or real (other than Capital Stock or other
               Investments), acquired, constructed or improved in the ordinary
               course of business of the Company or such Restricted Subsidiary,
               and Attributable Indebtedness, in an aggregate principal amount,
               including all Refinancing Indebtedness Incurred to refund,
               defease, renew, extend, refinance or replace any Indebtedness
               Incurred pursuant to this clause (7), not to exceed $10 million
               at any time outstanding;

          (8)  Indebtedness Incurred in respect of workers' compensation claims,
               self-insurance obligations, or otherwise in connection with
               workers' compensation, health, disability or other employee
               benefits or property, casualty or liability insurance, pursuant
               to indemnification or reimbursement obligations, performance,
               bid, appeal, surety and similar bonds and completion guarantees
               provided by the Company or a Restricted Subsidiary in the
               ordinary course of business;

          (9)  Indebtedness arising from agreements of the Company or a
               Restricted Subsidiary providing for indemnification, adjustment
               of purchase price or similar obligations, in each case, Incurred
               or assumed in connection with the acquisition or disposition of
               any business, assets or Capital Stock of a Restricted Subsidiary,
               provided that, in the case of any disposition, the maximum
               aggregate liability in respect of all such Indebtedness shall at
               no time exceed the gross proceeds actually received by the
               Company and its Restricted Subsidiaries in connection with such
               disposition;

          (10) Indebtedness arising from the honoring by a bank or other
               financial institution of a check, draft or similar instrument
               (except in the case of daylight overdrafts) drawn against
               insufficient funds in the ordinary course of business, provided,
               however, that such Indebtedness is extinguished within five
               business days of Incurrence;

          (11) Indebtedness Incurred by Foreign Subsidiaries in an aggregate
               principal amount at any time outstanding under this clause (11),
               including all Refinancing Indebtedness Incurred to renew, refund,
               refinance, replace, defease or discharge any Indebtedness
               incurred pursuant to this clause (11), not to exceed $10 million;
               and

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          (12) in addition to the items referred to in clauses (1) through (11)
               above, Indebtedness of the Company and its Restricted
               Subsidiaries in an aggregate outstanding principal amount which,
               when taken together with the principal amount of all other
               Indebtedness Incurred pursuant to this clause (12) and then
               outstanding, will not exceed $25 million at any time outstanding.

The Company will not Incur any Indebtedness under the preceding paragraph if the
proceeds thereof are used, directly or indirectly, to refinance any Subordinated
Obligations of the Issuers unless such Indebtedness will be subordinated to the
Securities to at least the same extent as such Subordinated Obligations. No
Subsidiary Guarantor will Incur any Indebtedness under the preceding paragraph
if the proceeds thereof are used, directly or indirectly, to refinance any
Guarantor Subordinated Obligations of such Subsidiary Guarantor unless such
Indebtedness will be subordinated to the obligations of such Subsidiary
Guarantor under its Subsidiary Guarantee to at least the same extent as such
Guarantor Subordinated Obligations.

          For purposes of determining compliance with, and the outstanding
principal amount of any particular Indebtedness Incurred pursuant to and in
compliance with, this covenant:

          (1)  subject to clause (2) below, in the event that Indebtedness meets
               the criteria of more than one of the types of Indebtedness
               described in the first and second paragraphs of this covenant,
               the Company, in its sole discretion, will classify such item of
               Indebtedness on the date of Incurrence and may later classify
               such item of Indebtedness in any manner that complies with this
               covenant and only be required to include the amount and type of
               such Indebtedness in one of such clauses;

          (2)  all Indebtedness outstanding on the Issue Date under the senior
               credit facility shall be deemed Incurred under clause (1) of the
               second paragraph of this covenant and not the first paragraph or
               clause (4) of the second paragraph of this covenant;

          (3)  Guarantees of, or obligations in respect of letters of credit
               relating to, Indebtedness which is otherwise included in the
               determination of a particular amount of Indebtedness shall not be
               included;

          (4)  if obligations in respect of letters of credit are Incurred
               pursuant to a Credit Facility and are being treated as Incurred
               pursuant to clause (1) of the second paragraph above and the
               letters of credit relate to other Indebtedness, then such other
               Indebtedness shall not be included;

          (5)  the principal amount of any Disqualified Stock of the Company or
               a Restricted Subsidiary, or Preferred Stock of a Restricted
               Subsidiary that is not a Subsidiary Guarantor, will be equal to
               the greater of the maximum mandatory redemption or repurchase
               price (not including, in either case,

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<PAGE>

               any redemption or repurchase premium) or the liquidation
               preference thereof;

          (6)  Indebtedness permitted by this covenant need not be permitted
               solely by reference to one provision permitting such Indebtedness
               but may be permitted in part by one such provision and in part by
               one or more other provisions of this covenant permitting such
               Indebtedness;

          (7)  the principal amount of any Indebtedness outstanding in
               connection with a securitization transaction or series of
               transactions is the amount of obligations outstanding under the
               legal documents entered into as part of such transaction that
               would be characterized as principal if such transaction were
               structured as a secured lending transaction rather than as a
               purchase relating to such transaction; and

          (8)  the amount of Indebtedness issued at a price that is less than
               the principal amount thereof will be equal to the amount of the
               liability in respect thereof determined in accordance with GAAP.

Accrual of interest, accrual of dividends, the accretion of accreted value, the
payment of interest in the form of additional Indebtedness and the payment of
dividends in the form of additional shares of Preferred Stock or Disqualified
Stock will not be deemed to be an Incurrence of Indebtedness for purposes of
this covenant. The amount of any Indebtedness outstanding as of any date shall
be (i) the accreted value thereof in the case of any Indebtedness issued with
original issue discount and (ii) the principal amount or liquidation preference
thereof, together with any interest thereon that is more than 30 days past due,
in the case of any other Indebtedness.

          In addition, the Company will not permit any of its Unrestricted
Subsidiaries to Incur any Indebtedness or issue any shares of Disqualified
Stock, other than Non-Recourse Debt. If at any time an Unrestricted Subsidiary
becomes a Restricted Subsidiary, any Indebtedness of such Subsidiary shall be
deemed to be Incurred by a Restricted Subsidiary as of such date (and, if such
Indebtedness is not permitted to be Incurred as of such date under this Section
3.2, the Company shall be in Default of this covenant).

          For purposes of determining compliance with any U.S.
dollar-denominated restriction on the Incurrence of Indebtedness, the U.S.
dollar-equivalent principal amount of Indebtedness denominated in a foreign
currency shall be calculated based on the relevant currency exchange rate in
effect on the date such Indebtedness was Incurred, in the case of term
Indebtedness, or first committed, in the case of revolving credit Indebtedness;
provided that if such Indebtedness is Incurred to refinance other Indebtedness
denominated in a foreign currency, and such refinancing would cause the
applicable U.S. dollar-dominated restriction to be exceeded if calculated at the
relevant currency exchange rate in effect on the date of such refinancing, such
U.S. dollar-dominated restriction shall be deemed not to have been exceeded so
long as the principal amount of such refinancing Indebtedness does not exceed
the principal amount of such Indebtedness being refinanced. Notwithstanding any
other provision of this covenant, the maximum amount of Indebtedness that the
Company may Incur pursuant to this

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<PAGE>

covenant shall not be deemed to be exceeded solely as a result of fluctuations
in the exchange rate of currencies. The principal amount of any Indebtedness
Incurred to refinance other Indebtedness, if Incurred in a different currency
from the Indebtedness being refinanced, shall be calculated based on the
currency exchange rate applicable to the currencies in which such Refinancing
Indebtedness is denominated that is in effect on the date of such refinancing.

          SECTION 3.3. Limitation on Restricted Payments. The Company will not,
and will not permit any of its Restricted Subsidiaries, directly or indirectly,
to:

          (1)  declare or pay any dividend or make any distribution (whether
               made in cash, securities or other property) on or in respect of
               its Capital Stock (including any payment in connection with any
               merger or consolidation involving the Company or any of its
               Restricted Subsidiaries) except:

               (a)  dividends or distributions payable in Capital Stock of the
                    Company (other than Disqualified Stock) or in options,
                    warrants or other rights to purchase such Capital Stock of
                    the Company; and

               (b)  dividends or distributions payable to the Company or another
                    Restricted Subsidiary (and if such Restricted Subsidiary is
                    not a Wholly-Owned Subsidiary, to its other holders of
                    common Capital Stock on a pro rata basis);

          (2)  purchase, redeem, retire or otherwise acquire for value any
               Capital Stock of the Company or any direct or indirect parent of
               the Company held by Persons other than the Company or a
               Restricted Subsidiary (other than in exchange for Capital Stock
               of the Company (other than Disqualified Stock));

          (3)  purchase, repurchase, redeem, defease or otherwise acquire or
               retire for value, prior to scheduled maturity, scheduled
               repayment or scheduled sinking fund payment, any Subordinated
               Obligations or Guarantor Subordinated Obligations (other than (x)
               Indebtedness of the Company owing to and held by any Subsidiary
               Guarantor or Indebtedness of a Subsidiary Guarantor owing to and
               held by the Company or any other Subsidiary Guarantor permitted
               under clause (3) of the second paragraph of Section 3.2 or (y)
               the purchase, repurchase, redemption, defeasance or other
               acquisition or retirement of Subordinated Obligations or
               Guarantor Subordinated Obligations purchased in anticipation of
               satisfying a sinking fund obligation, principal installment or
               final maturity, in each case due within one year of the date of
               purchase, repurchase, redemption, defeasance or other acquisition
               or retirement); or

          (4)  make any Restricted Investment in any Person;

(any such dividend, distribution, purchase, redemption, repurchase, defeasance,
other acquisition, retirement or Restricted Investment referred to in clauses
(1) through (4) shall be referred to

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herein as a "Restricted Payment"), if at the time the Company or such Restricted
Subsidiary makes such Restricted Payment:

          (a)  a Default shall have occurred and be continuing (or would result
               therefrom); or

          (b)  the Company is not able to Incur $1.00 of additional Indebtedness
               pursuant to the first paragraph under Section 3.2 after giving
               effect, on a pro forma basis, to such Restricted Payment; or

          (c)  the aggregate amount of such Restricted Payment and all other
               Restricted Payments declared or made subsequent to the Issue Date
               (excluding Restricted Payments made pursuant to clauses (1), (2),
               (3), (4), (7), (8), (9), (10) and (13) of the next succeeding
               paragraph) would exceed the sum of:

               (i)  50% of Consolidated Net Income for the period (treated as
                    one accounting period) from the beginning of the fiscal
                    quarter in which the Issue Date occurs to the end of the
                    most recent fiscal quarter ending prior to the date of such
                    Restricted Payment for which financial statements are in
                    existence (or, in case such Consolidated Net Income is a
                    deficit, minus 100% of such deficit);

               (ii) 100% of (x) the aggregate Net Cash Proceeds received by the
                    Company from the issue or sale of its Capital Stock (other
                    than Disqualified Stock) or other capital contributions
                    subsequent to the Issue Date (other than Net Cash Proceeds
                    received from an issuance or sale of such Capital Stock to a
                    Subsidiary of the Company or an employee stock ownership
                    plan, option plan or similar trust to the extent such sale
                    to an employee stock ownership plan or similar trust is
                    financed by loans from or Guaranteed by the Company or any
                    Restricted Subsidiary unless such loans have been repaid
                    with cash on or prior to the date of determination) and (y)
                    the fair market value of property constituting Additional
                    Assets received by the Company subsequent to the Issue Date
                    in exchange for its Capital Stock (other than Disqualified
                    Stock); provided that this clause (ii) shall not include the
                    proceeds from or assets received as Excluded Contributions;

               (iii) the amount by which Indebtedness of the Company or its
                    Restricted Subsidiaries is reduced on the Company's balance
                    sheet upon the conversion or exchange (other than by a
                    Subsidiary of the Company) subsequent to the Issue Date of
                    any Indebtedness of the Company or its Restricted
                    Subsidiaries convertible or exchangeable for Capital Stock
                    (other than Disqualified Stock) of the Company (less the
                    amount of any cash, or the fair market value

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                    of any other property, distributed by the Company upon such
                    conversion or exchange); and

               (iv) the amount equal to the net reduction in Restricted
                    Investments made by the Company or any of its Restricted
                    Subsidiaries in any Person resulting from:

                    (A)  repurchases or redemptions of such Restricted
                         Investments by such Person, proceeds realized upon the
                         sale of such Restricted Investment to an unaffiliated
                         purchaser, repayments of loans or advances or other
                         transfers of assets (including by way of dividend or
                         distribution) by such Person to the Company or any
                         Restricted Subsidiary (other than for reimbursement of
                         tax payments);

                    (B)  the redesignation of Unrestricted Subsidiaries as
                         Restricted Subsidiaries (valued in each case as
                         provided in the definition of "Investment") not to
                         exceed, in the case of any Unrestricted Subsidiary, the
                         amount of Investments previously made by the Company or
                         any Restricted Subsidiary in such Unrestricted
                         Subsidiary; or

                    (C)  dividends and distributions received from Unrestricted
                         Subsidiaries.

                    which amount in each case under clause (iv)(A) and (B) above
                    was included in the calculation of the amount of Restricted
                    Payments; provided, however, that no amount will be included
                    under this clause (iv) to the extent it is already included
                    in Consolidated Net Income.

          The provisions of the preceding paragraph will not prohibit:

          (1)  any purchase, repurchase, redemption, defeasance or other
               acquisition or retirement of Capital Stock, Disqualified Stock or
               Subordinated Obligations of the Company or Guarantor Subordinated
               Obligations of any Subsidiary Guarantor made by exchange for, or
               out of the proceeds of the substantially concurrent sale of,
               Capital Stock of the Company (other than Disqualified Stock and
               other than Capital Stock issued or sold to a Subsidiary or an
               employee stock ownership plan or similar trust to the extent such
               sale to an employee stock ownership plan or similar trust is
               financed by loans from or Guaranteed by the Company or any
               Restricted Subsidiary unless such loans have been repaid with
               cash on or prior to the date of determination); provided,
               however, that the Net Cash Proceeds from such sale of Capital
               Stock will be excluded from clause (c)(ii) of the preceding
               paragraph;

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          (2)  any purchase, repurchase, redemption, defeasance or other
               acquisition or retirement of Subordinated Obligations of the
               Company or Guarantor Subordinated Obligations of any Subsidiary
               Guarantor made by exchange for, or out of the proceeds of the
               substantially concurrent sale of, Subordinated Obligations of the
               Company or any purchase, repurchase, redemption, defeasance or
               other acquisition or retirement of Guarantor Subordinated
               Obligations made by exchange for or out of the proceeds of the
               substantially concurrent sale of Guarantor Subordinated
               Obligations that, in each case, is permitted to be Incurred
               pursuant to Section 3.2 and that in each case constitutes
               Refinancing Indebtedness;

          (3)  any purchase, repurchase, redemption, defeasance or other
               acquisition or retirement of Disqualified Stock of the Company or
               a Restricted Subsidiary made by exchange for or out of the
               proceeds of the substantially concurrent sale of Disqualified
               Stock of the Company or such Restricted Subsidiary, as the case
               may be, that, in each case, is permitted to be Incurred pursuant
               to Section 3.2 and that in each case constitutes Refinancing
               Indebtedness;

          (4)  so long as no Default or Event of Default has occurred and is
               continuing, any purchase or redemption of Subordinated
               Obligations or Guarantor Subordinated Obligations of a Subsidiary
               Guarantor from Net Available Cash to the extent permitted under
               Section 3.7 below;

          (5)  dividends or distributions paid within 60 days after the date of
               declaration if at such date of declaration such dividend or
               distribution would have complied with this provision;

          (6)  so long as no Default or Event of Default has occurred and is
               continuing:

               (a)  the purchase, redemption or other acquisition, cancellation
                    or retirement for value of Capital Stock, or options,
                    warrants, equity appreciation rights or other rights to
                    purchase or acquire Capital Stock of the Company or any
                    Restricted Subsidiary or any direct or indirect parent of
                    the Company held by any existing or former employees or
                    management of the Company or any Subsidiary of the Company
                    or their assigns, estates or heirs, in each case in
                    connection with the repurchase provisions under employee
                    stock option or stock purchase agreements or other
                    agreements to compensate management employees; provided that
                    such Capital Stock, or options, warrants, equity
                    appreciation rights or other rights to purchase or acquire
                    Capital Stock, were received for services related to, or for
                    the benefit of, the Company and its Restricted Subsidiaries;
                    and provided further that such redemptions or repurchases
                    pursuant to this clause will not exceed $5 million in the
                    aggregate for all such redemptions and repurchases, plus the
                    amount of any capital contributions to the

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<PAGE>

                    Company as a result of sales of Capital Stock, or options,
                    warrants, equity appreciation rights or other rights to
                    purchase or acquire Capital Stock, of the Company or any
                    direct or indirect parent of the Company to such persons
                    (provided, however, that the Net Cash Proceeds from such
                    sale of Capital Stock so applied will be excluded from
                    clause (c)(ii) of the preceding paragraph); and

               (b)  loans or advances to employees, officers or directors of the
                    Company or any Subsidiary of the Company the proceeds of
                    which are used to purchase Capital Stock of the Company, in
                    an aggregate amount not in excess of $5 million with respect
                    to all loans or advances made since the Issue Date (without
                    giving effect to the forgiveness of any such loan) provided,
                    however, that the Company and its Subsidiaries shall comply
                    in all material respects with applicable law;

          (7)  so long as no Default or Event of Default has occurred and is
               continuing, the declaration and payment of dividends to holders
               of any class or series of Disqualified Stock of the Company
               issued in accordance with the terms of this Indenture to the
               extent such dividends are included in the definition of
               "Consolidated Interest Expense;"

          (8)  repurchases of Capital Stock deemed to occur upon the exercise of
               stock options, warrants or other convertible securities if such
               Capital Stock represents a portion of the exercise price thereof;

          (9)  (a)  with respect to each tax year or portion thereof that the
                    Company qualifies as a Flow Through Entity, the distribution
                    by the Company to the holders of Capital Stock of the
                    Company of an amount equal to the product of (i) the amount
                    of aggregate net taxable income of the Company allocated to
                    the holders of Capital Stock of the Company for such period
                    (it being understood that for purposes of calculating such
                    taxable income pursuant to this clause (a), any of the
                    Company's non-cash interest expense and amortization of
                    original issue discount shall be excluded) and (ii) the
                    Presumed Tax Rate for such period; and

               (b)  with respect to any tax year or portion thereof that the
                    Company does not qualify as a Flow Through Entity, the
                    payment of dividends or other distributions to any direct or
                    indirect parent company of the Company in amounts required
                    for such parent company to pay federal, state or local
                    income taxes (as the case may be) imposed directly on such
                    parent company to the extent such income taxes are
                    attributable to the income of the Company and its Restricted
                    Subsidiaries (including without limitation, by virtue of
                    such parent company being the common parent of a

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<PAGE>

                    consolidated or combined tax group of which the Company
                    and/or its Restricted Subsidiaries are members);

          (10) the purchase, repurchase, redemption, defeasance or other
               acquisition or retirement for value of any Subordinated
               Obligation (i) at a purchase price not greater than 101% of the
               principal amount of such Subordinated Obligation in the event of
               a Change of Control in accordance with provisions similar to
               Section 3.9 or (ii) at a purchase price not greater than 100% of
               the principal amount thereof in accordance with provisions
               similar to Section 3.7; provided that, prior to or
               contemporaneously with such purchase, repurchase, redemption,
               defeasance or other acquisition or retirement, the Company has
               made the Change of Control Offer or Asset Disposition Offer, as
               applicable, as provided in such covenant with respect to the
               Securities and has completed the repurchase or redemption of all
               Securities validly tendered for payment in connection with such
               Change of Control Offer or Asset Disposition Offer;

          (11) the payment of cash in lieu of fractional shares of Capital Stock
               in connection with any transaction otherwise permitted under this
               Indenture;

          (12) the payment of dividends on the Company's Common Stock following
               the first Equity Offering of the Company's Common Stock in a
               registered public offering after the Issue Date of up to 6% per
               annum of the Net Cash Proceeds received by the Company in such
               Equity Offering, other than public offerings of the Company's
               Common Stock registered on Form S-4 or S-8 and other than any
               public sale constituting an Excluded Contribution;

          (13) Investments that are made with Excluded Contributions; and

          (14) Investments in Stewart & Stevenson Truck Holdings LLC made after
               the Issue Date in an amount not to exceed at any time outstanding
               (after giving effect to any returns of capital or other repayment
               of such investment) $1 million.

The amount of all Restricted Payments (other than cash) shall be the fair market
value on the date of such Restricted Payment of the asset(s) or securities
proposed to be paid, transferred or issued by the Company or such Restricted
Subsidiary, as the case may be, pursuant to such Restricted Payment. The fair
market value of any cash Restricted Payment shall be its face amount and any
non-cash Restricted Payment shall be determined conclusively by:

          (1)  the Company acting in good faith, if such fair market value is
               estimated by the Company to be less than $5 million;

          (2)  the Board of Directors of the Company acting in good faith, whose
               resolution with respect thereto shall be delivered to the
               Trustee, if such

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<PAGE>

               fair market value is estimated by the Board of Directors of the
               Company to be less than $20 million; and

          (3)  an opinion or appraisal issued by an accounting, appraisal or
               investment banking firm of national standing, whose opinion or
               appraisal with respect thereto shall be delivered to the Trustee,
               if such fair market value is estimated in good faith by the Board
               of Directors of the Company to exceed $20 million.

Not later than the date of making any Restricted Payment, the Company shall
deliver to the Trustee an Officers' Certificate stating that such Restricted
Payment is permitted and setting forth the basis upon which the calculations
required by this Section 3.3 were computed, together with a copy of any
resolution, fairness opinion or appraisal required by this Indenture.

          SECTION 3.4. Limitation on Liens. The Company will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly, create,
Incur or suffer to exist any Lien (other than Permitted Liens) upon any of its
property or assets (including Capital Stock of Subsidiaries), whether owned on
the Issue Date or acquired after that date, which Lien is securing any
Indebtedness, unless contemporaneously with the Incurrence of such Liens
effective provision is made to secure the Indebtedness due under this Indenture
and the Securities or, in respect of Liens on any Restricted Subsidiary's
property or assets, any Subsidiary Guarantee of such Restricted Subsidiary,
equally and ratably with (or senior in priority to in the case of Liens with
respect to Subordinated Obligations or Guarantor Subordinated Obligations, as
the case may be) the Indebtedness secured by such Lien for so long as such
Indebtedness is so secured.

          SECTION 3.5. Limitation on Sale/Leaseback Transactions. The Company
will not, and will not permit any of its Restricted Subsidiaries to, enter into
any Sale/Leaseback Transaction unless:

          (1)  the Company or such Restricted Subsidiary could have Incurred
               Indebtedness in an amount equal to the Attributable Indebtedness
               in respect of such Sale/Leaseback Transaction pursuant to the
               covenant described under Section 3.2; or

          (2)  the Sale/Leaseback Transaction is treated as an Asset Disposition
               and all of the conditions of this Indenture described under
               Section 3.7 (including the provisions concerning the application
               of Net Available Cash) are satisfied with respect to such
               Sale/Leaseback Transaction, treating all of the consideration
               received in such Sale/Leaseback Transaction as Net Available Cash
               for purposes of such covenant.

          SECTION 3.6. Limitation on Restrictions on Distributions from
Restricted Subsidiaries. The Company will not, and will not permit any
Restricted Subsidiary to, create or otherwise cause or permit to exist or become
effective any consensual encumbrance or consensual restriction on the ability of
any Restricted Subsidiary to:

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<PAGE>

          (1)  pay dividends or make any other distributions on its Capital
               Stock or pay any Indebtedness or other obligations owed to the
               Company or any Restricted Subsidiary (it being understood that
               the priority of any Preferred Stock in receiving dividends or
               liquidating distributions prior to dividends or liquidating
               distributions being paid on Common Stock shall not be deemed a
               restriction on the ability to make distributions on Capital
               Stock);

          (2)  make any loans or advances to the Company or any Restricted
               Subsidiary (it being understood that the subordination of loans
               or advances made to the Company or any Restricted Subsidiary to
               other Indebtedness Incurred by the Company or any Restricted
               Subsidiary shall not be deemed a restriction on the ability to
               make loans or advances); or

          (3)  transfer any of its property or assets to the Company or any
               Restricted Subsidiary (it being understood that such transfers
               shall not include any type of transfer described in clause (1) or
               (2) above).

          The preceding provisions will not prohibit:

               (i)  any encumbrance or restriction pursuant to an agreement in
                    effect at or entered into on the Issue Date, including,
                    without limitation, this Indenture, the Securities, the
                    Exchange Securities, the Subsidiary Guarantees, and the
                    senior credit facility (and related documentation) in effect
                    on such date;

               (ii) any encumbrance or restriction with respect to a Restricted
                    Subsidiary or a Person merged into a Restricted Subsidiary
                    pursuant to an agreement relating to any Capital Stock or
                    Indebtedness Incurred by a Restricted Subsidiary on or
                    before the date on which such Restricted Subsidiary was
                    acquired by the Company or a Restricted Subsidiary (other
                    than Capital Stock or Indebtedness Incurred as consideration
                    in, or to provide all or any portion of the funds utilized
                    to consummate, the transaction or series of related
                    transactions pursuant to which such Restricted Subsidiary
                    became a Restricted Subsidiary or was acquired by the
                    Company or in contemplation of the transaction) and
                    outstanding on such date provided, that any such encumbrance
                    or restriction shall not extend to any assets or property of
                    the Company or any other Restricted Subsidiary other than
                    the assets and property so acquired and that, in the case of
                    Indebtedness, was permitted to be Incurred pursuant to this
                    Indenture;

               (iii) any encumbrance or restriction with respect to a Restricted
                    Subsidiary pursuant to an agreement effecting a refunding,
                    replacement or refinancing of Indebtedness Incurred pursuant
                    to an agreement referred to in clause (i) or (ii) of this
                    paragraph or this

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<PAGE>

                    clause (iii) or contained in any amendment, restatement,
                    modification, renewal, supplement, refunding, replacement or
                    refinancing of an agreement referred to in clause (i) or
                    (ii) of this paragraph or this clause (iii); provided,
                    however, that the encumbrances and restrictions with respect
                    to such Restricted Subsidiary contained in any such
                    agreement are no less favorable in any material respect,
                    taken as a whole, to the Holders of the Securities than the
                    encumbrances and restrictions contained in such agreements
                    referred to in clauses (i) or (ii) of this paragraph on the
                    Issue Date or the date such Restricted Subsidiary became a
                    Restricted Subsidiary or was merged into a Restricted
                    Subsidiary, whichever is applicable;

               (iv) in the case of clause (3) of the first paragraph of this
                    covenant, any encumbrance or restriction:

                    (A)  that restricts in a customary manner the subletting,
                         assignment or transfer of any property or asset that is
                         subject to a lease, license or similar contract, or the
                         assignment or transfer of any such lease, license or
                         other contract;

                    (B)  contained in mortgages, pledges or other security
                         agreements permitted under this Indenture securing
                         Indebtedness of the Company or a Restricted Subsidiary
                         to the extent such encumbrances or restrictions
                         restrict the transfer of the property subject to such
                         mortgages, pledges or other security agreements; or

                    (C)  pursuant to customary provisions restricting
                         dispositions of real property interests set forth in
                         any reciprocal easement agreements of the Company or
                         any Restricted Subsidiary;

               (v)  (A) purchase money obligations for property acquired in the
                    ordinary course of business and (B) Capitalized Lease
                    Obligations permitted under this Indenture, in each case,
                    that impose encumbrances or restrictions of the nature
                    described in clause (3) of the first paragraph of this
                    covenant on the property so acquired;

               (vi) any restriction with respect to a Restricted Subsidiary (or
                    any of its property or assets) imposed pursuant to an
                    agreement entered into for the direct or indirect sale or
                    disposition of the Capital Stock or assets of such
                    Restricted Subsidiary (or the property or assets that are
                    subject to such restriction) pending the closing of such
                    sale or disposition;

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<PAGE>

               (vii) any customary provisions in joint venture agreements
                    relating to joint ventures that are not Restricted
                    Subsidiaries and other similar agreements entered into in
                    the ordinary course of business;

               (viii) restrictions on cash and net worth provisions in leases
                    and other agreements entered into by the Company or any
                    Restricted Subsidiary in the ordinary course of business;

               (ix) encumbrances and restrictions contained in contracts entered
                    into in the ordinary course of business, not relating to any
                    Indebtedness, and that do not, individually or in the
                    aggregate, detract from the value of, or from the ability of
                    the Company and the Restricted Subsidiaries to realize the
                    value of, property or assets of the Company or any
                    Restricted Subsidiary in any manner material to the Company
                    or any Restricted Subsidiary; and

               (x)  encumbrances or restrictions arising or existing by reason
                    of applicable law or any applicable rule, regulation or
                    order.

          SECTION 3.7. Limitation on Sales of Assets and Subsidiary Stock. The
Company will not, and will not permit any of its Restricted Subsidiaries to,
make any Asset Disposition unless:

          (1)  the Company or such Restricted Subsidiary, as the case may be,
               receives consideration at least equal to the fair market value
               (such fair market value to be determined on the date of
               contractually agreeing to such Asset Disposition), as determined
               in good faith by the Board of Directors of the Company (including
               as to the value of all non-cash consideration) of the shares and
               assets subject to such Asset Disposition;

          (2)  at least 75% of the consideration from such Asset Disposition
               received by the Company or such Restricted Subsidiary, as the
               case may be, is in the form of cash or Cash Equivalents, provided
               that the following will be deemed to be cash:

               (a)  the assumption by the transferee of Indebtedness (other than
                    Subordinated Obligations or Disqualified Stock) of the
                    Company or Indebtedness of a Restricted Subsidiary (other
                    than Guarantor Subordinated Obligations or Disqualified
                    Stock of any Restricted Subsidiary that is a Subsidiary
                    Guarantor) and the release of the Company or such Restricted
                    Subsidiary from all liability on such Indebtedness in
                    connection with such Asset Disposition (in which case the
                    Company will, without further action, be deemed to have
                    applied such deemed cash to payment of Indebtedness in
                    accordance with clause (3)(a) below);

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<PAGE>

               (b)  securities, notes or other obligations received by the
                    Company or any Restricted Subsidiary from the transferee
                    that are within 30 days of receipt converted by the Company
                    or such Restricted Subsidiary into cash; and

               (c)  any Additional Assets received by the Company or such
                    Restricted Subsidiary in connection with such Asset
                    Disposition; and

          (3)  an amount equal to 100% of the Net Available Cash from such Asset
               Disposition is applied by the Company or such Restricted
               Subsidiary, as the case may be:

               (a)  first, to the extent the Company or any Restricted
                    Subsidiary, as the case may be, elects (or is required by
                    the terms of any Indebtedness), to prepay, repay or purchase
                    Indebtedness of the Company (other than any Disqualified
                    Stock or Subordinated Obligations) or Indebtedness of a
                    Restricted Subsidiary (other than any Disqualified Stock or
                    Guarantor Subordinated Obligations of a Restricted
                    Subsidiary that is a Subsidiary Guarantor) (in each case
                    other than Indebtedness owed to the Company or an Affiliate
                    of the Company) or any combination thereof within 365 days
                    from the later of the date of such Asset Disposition or the
                    receipt of such Net Available Cash; provided, however, that,
                    in connection with any prepayment, repayment or purchase of
                    Indebtedness pursuant to this clause (a), the Company or
                    such Restricted Subsidiary will retire such Indebtedness and
                    will cause the related commitment (if any) to be permanently
                    reduced in an amount equal to the principal amount so
                    prepaid, repaid or purchased; and

               (b)  second, to the extent of the balance of such Net Available
                    Cash after application in accordance with clause (a), to the
                    extent the Company or such Restricted Subsidiary elects, to
                    invest in Additional Assets within 365 days from the later
                    of the date of such Asset Disposition or the receipt of such
                    Net Available Cash (or within such 365 days, enter into a
                    definitive agreement with respect thereto that is
                    consummated within 545 days after the receipt of such Net
                    Available Cash);

               provided that pending the final application of any such Net
               Available Cash in accordance with clause (a) or clause (b) above,
               the Company and its Restricted Subsidiaries may temporarily
               reduce Indebtedness or otherwise invest such Net Available Cash
               in any manner not prohibited by the Indenture.

          Any Net Available Cash from Asset Dispositions that are not applied or
invested as provided in, and within the time period set forth in, the preceding
paragraph will be deemed to constitute "Excess Proceeds." On the day that the
aggregate amount of Excess Proceeds exceeds

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$15.0 million, the Issuers will be required to make an offer ("Asset Disposition
Offer") to all Holders of Securities and to the extent required by the terms of
other Pari Passu Indebtedness, to all holders of other Pari Passu Indebtedness
outstanding with similar provisions requiring an Issuer to make an offer to
purchase such Pari Passu Indebtedness with the proceeds from any Asset
Disposition ("Pari Passu Notes") to purchase the maximum principal amount of
Securities and any such Pari Passu Notes to which the Asset Disposition Offer
applies that may be purchased out of the Excess Proceeds, at an offer price in
cash in an amount equal to 100% of the principal amount of the Securities and
Pari Passu Notes plus accrued and unpaid interest to the date of purchase, in
accordance with the procedures set forth in the Indenture or the agreements
governing the Pari Passu Notes, as applicable, in each case in the applicable
principal amounts and integral multiples thereof. To the extent that the
aggregate amount of Securities and Pari Passu Notes so validly tendered and not
properly withdrawn pursuant to an Asset Disposition Offer is less than the
Excess Proceeds, the Issuers may use any remaining Excess Proceeds for general
corporate purposes, subject to other covenants contained in the Indenture. If
the aggregate principal amount of Securities surrendered by Holders thereof and
other Pari Passu Notes surrendered by holders or lenders, collectively, exceeds
the amount of Excess Proceeds, the Trustee shall select the Securities and the
Issuers or the applicable agent or trustee for the Pari Passu Notes to be
purchased on a pro rata basis on the basis of the aggregate principal amount of
tendered Securities and Pari Passu Notes. Upon completion of such Asset
Disposition Offer, the amount of Excess Proceeds shall be reset at zero.

          The Asset Disposition Offer will remain open for a period of 20
Business Days following its commencement, except to the extent that a longer
period is required by applicable law (the "Asset Disposition Offer Period"). No
later than five Business Days after the termination of the Asset Disposition
Offer Period (the "Asset Disposition Purchase Date"), the Company shall purchase
the principal amount of Securities and Pari Passu Notes required to be purchased
pursuant to this covenant (the "Asset Disposition Offer Amount") or, if less
than the Asset Disposition Offer Amount has been so validly tendered, all
Securities and Pari Passu Notes validly tendered in response to the Asset
Disposition Offer.

          If the Asset Disposition Purchase Date is on or after an interest
payment record date and on or before the related interest payment date, any
accrued and unpaid interest will be paid to the Person in whose name a Security
is registered at the close of business on such record date, and no additional
interest will be payable to Holders who tender Securities pursuant to the Asset
Disposition Offer.

          On or before the Asset Disposition Purchase Date, the Issuers will, to
the extent lawful, accept for payment, on a pro rata basis to the extent
necessary, the Asset Disposition Offer Amount of Securities and Pari Passu Notes
or portions of Securities and Pari Passu Notes so validly tendered and not
properly withdrawn pursuant to the Asset Disposition Offer, or if less than the
Asset Disposition Offer Amount has been validly tendered and not properly
withdrawn, all Securities and Pari Passu Notes so validly tendered and not
properly withdrawn, in each case in the applicable principal amounts and
integral multiples of $1,000. Each of the Issuers will deliver to the Trustee an
Officers' Certificate stating that such Securities or portions thereof were
accepted for payment by the Issuers in accordance with the terms of this
covenant and, in addition, each of the Issuers will deliver all certificates and
notes required, if any, by the agreements governing the Pari Passu Notes. The
Issuers or the Paying Agent, as the case may be,

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<PAGE>

will promptly (but in any case not later than five Business Days after
termination of the Asset Disposition Offer Period) mail or deliver to each
tendering Holder of Securities or holder or lender of Pari Passu Notes, as the
case may be, an amount equal to the purchase price of the Securities or Pari
Passu Notes so validly tendered and not properly withdrawn by such holder or
lender, as the case may be, and accepted by the Issuers for purchase, and the
Issuers will promptly issue a new Security, and the Trustee, upon delivery of an
Officers' Certificate from each of the Issuers, will authenticate and mail or
deliver such new Security to such Holder, in a principal amount equal to any
unpurchased portion of the Security surrendered; provided that each such new
Security will be in a principal amount of $1,000 or an integral multiple of
$1,000. In addition, the Issuers will take any and all other actions required by
the agreements governing the Pari Passu Notes. Any Security not so accepted will
be promptly mailed or delivered by the Issuers to the Holder thereof. The
Issuers will publicly announce the results of the Asset Disposition Offer on the
Asset Disposition Purchase Date.

          The Issuers will comply, to the extent applicable, with the
requirements of Rule 14e-1 under the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to this
Indenture. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this covenant, the Issuers will comply
with the applicable securities laws and regulations and will not be deemed to
have breached its obligations under this Indenture by virtue of any conflict.

          SECTION 3.8. Limitation on Affiliate Transactions. The Company will
not, and will not permit any of its Restricted Subsidiaries to, directly or
indirectly, enter into or conduct any transaction (including the purchase, sale,
lease or exchange of any property or the rendering of any service) with any
Affiliate of the Company (an "Affiliate Transaction") unless:

          (1)  the terms of such Affiliate Transaction are no less favorable to
               the Company or such Restricted Subsidiary, as the case may be,
               than those that would reasonably be expected to be obtained in a
               comparable transaction at the time of such transaction in
               arm's-length dealings with a Person who is not such an Affiliate;

          (2)  in the event such Affiliate Transaction involves an aggregate
               consideration in excess of $5 million, the terms of such
               transaction have been approved by a majority of the members of
               the Board of Directors of the Company and by a majority of the
               members of such Board having no personal stake in such
               transaction, if any (and such majority or majorities, as the case
               may be, determines that such Affiliate Transaction satisfies the
               criteria in clause (1) above); and

          (3)  in the event such Affiliate Transaction involves an aggregate
               consideration in excess of $20 million, the Company has received
               a written opinion from an independent investment banking,
               accounting or appraisal firm of nationally recognized standing
               that such Affiliate Transaction is not materially less favorable
               than those that might reasonably have been obtained in a
               comparable transaction at such time on an arm's-length basis from
               a Person that is not an Affiliate.

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          The preceding paragraph will not apply to:

          (1)  any Restricted Payment (other than a Restricted Investment)
               permitted to be made pursuant to Section 3.3;

          (2)  any issuance of securities, or other payments, awards or grants
               in cash, securities or otherwise pursuant to, or the funding of,
               employment agreements and other compensation arrangements,
               options to purchase Capital Stock of the Company, restricted
               stock plans, long-term incentive plans, stock appreciation rights
               plans, participation plans or similar employee benefits plans
               and/or indemnity provided on behalf of officers and employees
               approved by the Board of Directors of the Company;

          (3)  loans or advances to employees, officers or directors of the
               Company or any Restricted Subsidiary of the Company in the
               ordinary course of business consistent with past practices, in an
               aggregate amount not in excess of $2 million with respect to all
               loans or advances made since the Issue Date (without giving
               effect to the forgiveness of any such loan); provided, however,
               that the Company and its Subsidiaries shall comply in all
               material respects with applicable law;

          (4)  any transaction between the Company and a Restricted Subsidiary
               or between Restricted Subsidiaries, and Guarantees issued by the
               Company or a Restricted Subsidiary for the benefit of the Company
               or a Restricted Subsidiary, as the case may be, in accordance
               with Section 3.2;

          (5)  the payment of reasonable and customary fees paid to, and
               indemnity provided on behalf of, directors of the Company or any
               Restricted Subsidiary;

          (6)  the existence of, and the performance of obligations of the
               Company or any of its Restricted Subsidiaries under the terms of
               any agreement to which the Company or any of its Restricted
               Subsidiaries is a party as of or on the Issue Date, as these
               agreements may be amended, modified, supplemented, extended or
               renewed from time to time; provided, however, that any future
               amendment, modification, supplement, extension or renewal entered
               into after the Issue Date will be permitted to the extent that
               its terms are not more disadvantageous to the Holders of the
               Securities than the terms of the agreements in effect on the
               Issue Date;

          (7)  transactions with customers, clients, suppliers or purchasers or
               sellers of goods or services, in each case in the ordinary course
               of the business of the Company and its Restricted Subsidiaries
               and otherwise in compliance with the terms of this Indenture;
               provided that in the reasonable determination of the members of
               the Boards of Directors or senior management of the Company, such
               transactions are on terms that are no less favorable to the
               Company or the relevant Restricted Subsidiary than

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               those that would reasonably be expected to have been obtained in
               a comparable transaction by the Company or such Restricted
               Subsidiary with an unrelated Person;

          (8)  any issuance or sale of Capital Stock (other than Disqualified
               Stock) to Affiliates of the Company and the granting of
               registration and other customary rights in connection therewith;

          (9)  Restricted Payments to affiliates of the Company permitted under
               Section 3.3; and

          (10) any transaction or series of transactions in an aggregate amount
               not in excess of $250,000.

          SECTION 3.9. Change of Control. If a Change of Control occurs, unless
any of the Issuers has exercised its right to redeem all of the Securities as
described under Article V, each Holder will have the right to require the
Issuers to repurchase all or any part (equal to $1,000 or an integral multiple
thereof) of such Holder's Securities at a purchase price in cash equal to 101%
of the principal amount of the Securities plus accrued and unpaid interest, if
any, to the date of purchase (subject to the right of Holders of record on the
relevant record date to receive interest due on the relevant interest payment
date).

          Within 30 days following any Change of Control, unless any of the
Issuers has exercised its right to redeem all of the Securities pursuant to
Article V, the Issuers will mail a notice (the "Change of Control Offer") to
each Holder, with a copy to the Trustee, stating:

          (1)  that a Change of Control has occurred and that such Holder has
               the right to require the Issuers to purchase all or any portion
               of such Holder's Securities at a purchase price in cash equal to
               101% of the principal amount of such Securities plus accrued and
               unpaid interest, if any, to the date of purchase (subject to the
               right of Holders of record on a record date to receive interest
               on the relevant interest payment date) (the "Change of Control
               Payment");

          (2)  the repurchase date (which shall be no earlier than 30 days nor
               later than 60 days from the date such notice is mailed) (the
               "Change of Control Payment Date"); and

          (3)  the procedures determined by the Issuers, consistent with this
               Indenture, that a Holder must follow in order to have its
               Securities repurchased.

          On the Change of Control Payment Date, the Issuers will, to the extent
lawful:

          (1)  accept for payment all Securities or portions of Securities (in
               integral multiples of $1,000) properly tendered pursuant to the
               Change of Control Offer;

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          (2)  deposit with the paying agent an amount equal to the Change of
               Control Payment in respect of all Securities or portions of
               Securities so tendered; and

          (3)  deliver or cause to be delivered to the Trustee the Securities so
               accepted together with an Officers' Certificate stating the
               aggregate principal amount of Securities or portions of
               Securities being purchased by the Issuers.

          The Paying Agent will promptly transmit to each Holder of Securities
so tendered the Change of Control Payment for such Securities, and the Trustee
will promptly authenticate and mail (or cause to be transferred by book entry)
to each Holder a new Security equal in principal amount to any unpurchased
portion of the Securities surrendered, if any; provided that each such new
Security shall be in a principal amount of $1,000 or an integral multiple
thereof.

          If the Change of Control Payment Date is on or after an interest
payment record date and on or before the related interest payment date, any
accrued and unpaid interest, if any, to the Change of Control Payment Date will
be paid to the Person in whose name a Security is registered at the close of
business on such record date, and no additional interest will be payable to
Holders who tender pursuant to the Change of Control Offer.

          Prior to mailing a Change of Control Offer, and as a condition to such
mailing (i) the requisite holders of each issue of Indebtedness issued under an
indenture or other agreement that may be violated by such payment shall have
consented to such Change of Control Offer being made and waived the event of
default, if any, caused by the Change of Control or (ii) the Issuers will repay
all outstanding Indebtedness issued under an indenture or other agreement that
may be violated by a payment to the Holders of Securities under a Change of
Control Offer or the Issuers must offer to repay all such Indebtedness, and make
payment to the holders of such Indebtedness that accept such offer, and obtain
waivers of any event of default from the remaining holders of such Indebtedness.
The Issuers covenant to effect such repayment or obtain such consent within 30
days following any Change of Control, it being a default of the Change of
Control provisions of this Indenture if the Issuers fail to comply with such
covenant. A default under this Indenture will result in a cross-default under
the senior credit facility.

          The Issuers will not be required to make a Change of Control Offer
upon a Change of Control if a third party makes the Change of Control Offer in
the manner, at the times and otherwise in compliance with the requirements set
forth in this Indenture applicable to a Change of Control Offer made by the
Issuers and purchases all Securities validly tendered and not withdrawn under
such Change of Control Offer.

          The Issuers will comply, to the extent applicable, with the
requirements of Rule 14e-1 under the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to this
covenant. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Indenture, the Issuers will comply
with the applicable securities laws and regulations and will not be deemed to
have breached its obligations described in this Indenture by virtue of the
conflict.

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          SECTION 3.10. SEC Reports. Until the Company becomes subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company
will make available to the Trustee and the registered Holders of the Securities
the annual reports and the information, documents and other reports (or copies
of such portions of any of the foregoing as the SEC may by rules and regulations
prescribe) that are specified in Sections 13 and 15(d) of the Exchange Act with
respect to U.S. companies that are subject to such reporting requirements within
the time periods specified therein or in the relevant forms.

          If the Company has designated any of its Subsidiaries as Unrestricted
Subsidiaries, then the quarterly and annual financial information required by
the preceding paragraph shall include a reasonably detailed presentation, either
on the face of the financial statements or in the footnotes to the financial
statements and in Management's Discussion and Analysis of Results of Operations
and Financial Condition, of the financial condition and results of operations of
the Company and its Restricted Subsidiaries.

          In addition, the Issuers and the Subsidiary Guarantors have agreed
that they will make available to the Holders and to prospective investors, upon
the request of such Holders, the information required to be delivered pursuant
to Rule 144A(d)(4) under the Securities Act so long as the Securities are not
freely transferable under the Securities Act. For purposes of this covenant, the
Issuers and the Subsidiary Guarantors will be deemed to have furnished the
reports to the Trustee and the Holders of Securities as required by this
covenant if it has filed such reports with the SEC via the EDGAR filing system
and such reports are publicly available.

          The filing requirements set forth above for the applicable period may
be satisfied by the Company prior to the commencement of the Registered Exchange
Offer or the effectiveness of the Shelf Registration Statement by the filing
with the SEC of the exchange offer registration statement and/or Shelf
Registration Statement, and any amendments thereto, with such financial
information that satisfies Regulation S-X of the Securities Act; provided that
this paragraph shall not supersede or in any manner suspend or delay the
Company's reporting obligations set forth in the first three paragraphs of this
covenant.

          In the event that any direct or indirect parent company of the Company
becomes a guarantor of the Securities, the Company may satisfy its obligations
under this covenant by furnishing financial information relating to such parent;
provided that (x) such financial statements are accompanied by consolidating
financial information for such parent, the Company, the Subsidiary Guarantors
and the Subsidiaries of the Company that are not Subsidiary Guarantors in the
manner prescribed by the SEC and (y) such parent is not engaged in any business
in any material respect other than incidental to its ownership, directly or
indirectly of the Capital Stock of the Company.

          SECTION 3.11. Future Subsidiary Guarantors. After the Issue Date, the
Company will cause each Domestic Subsidiary or Foreign Subsidiary that is
neither a CFC nor directly or indirectly owned by a CFC and that is created or
acquired by the Company to execute and deliver to the Trustee a Subsidiary
Guarantee pursuant to which such Subsidiary Guarantor in a supplemental
Indenture will unconditionally Guarantee, on a joint and several basis, the full
and prompt payment of the principal of, premium, if any and interest on the
Securities on a senior basis.

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          The obligations of each Subsidiary Guarantor will be limited to the
maximum amount as will, after giving effect to all other contingent and fixed
liabilities of such Subsidiary Guarantor (including, without limitation, any
guarantees under the Credit Facility) and after giving effect to any collections
from or payments made by or on behalf of any other Subsidiary Guarantor in
respect of the obligations of such other Subsidiary Guarantor under its
Subsidiary Guarantee or pursuant to its contribution obligations under the
Indenture, result in the obligations of such Subsidiary Guarantor under its
Subsidiary Guarantee not constituting a fraudulent conveyance or fraudulent
transfer under federal or state law.

          SECTION 3.12. Maintenance of Office or Agency. The Issuers shall
maintain an office or agency where the Securities may be presented or
surrendered for payment, where, if applicable, the Securities may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Issuers in respect of the Securities and this Indenture may be served.
The agency of Wells Fargo Bank, National Association (the "Agent") currently
located at Sixth and Marquette, MAC N9303-120, Minneapolis, Minnesota 55479,
Attention: Corporate Trust Services, shall be such office or agency of the
Issuers, unless the Issuers shall designate and maintain some other office or
agency for one or more of such purposes. The Issuers shall give prompt written
notice to the Trustee of any change in the location of any such office or
agency. If at any time the Issuers shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Agent of the Trustee, and the Issuers hereby appoints the Trustee as its agent
to receive all such presentations, surrenders, notices and demands.

          The Issuers may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind any such designation. The
Issuers shall give prompt written notice to the Trustee of any such designation
or rescission and any change in the location of any such other office or agency.

          SECTION 3.13. Corporate Existence. Except as otherwise provided in
this Article III, Article IV and Section 10.2 (b), each of the Issuers shall do
or cause to be done all things necessary to preserve and keep in full force and
effect its limited liability company or corporate existence, as applicable, and
the corporate, partnership, limited liability company or other existence of each
Subsidiary Guarantor in accordance with their respective organizational
documents (as the same may be amended from time to time) and the rights (charter
and statutory) licenses and franchises of the Issuers and each such Subsidiary
Guarantor; provided, however, that the Issuers shall not be required to preserve
any such right, license or franchise or the corporate, partnership, limited
liability company or other existence of any Subsidiary Guarantor if the Board of
Directors of the Issuers shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Issuers and each of its
Restricted Subsidiaries, taken as a whole, and that the loss thereof is not, and
will not be, disadvantageous in any material respect to the Holders; provided,
further, that the foregoing shall not prohibit a sale, transfer, or conveyance
of a Subsidiary Guarantor or any of its assets in compliance with the terms of
this Indenture.

          SECTION 3.14. Payment of Taxes and Other Claims. The Issuers shall pay
or discharge or cause to be paid or discharged, before the same shall become
delinquent, (i) all

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material taxes, assessments and governmental charges levied or imposed upon the
Issuers or any Subsidiary Guarantor or upon the income, profits or property of
the Issuers or any Subsidiary Guarantor and (ii) all lawful claims for labor,
materials and supplies, which, if unpaid, might by law become a material
liability or lien upon the property of the Issuers or any Subsidiary; provided,
however, that the Issuers shall not be required to pay or discharge or cause to
be paid or discharged any such tax, assessment, charge or claim the amount,
applicability or validity of which is being contested in good faith by
appropriate proceedings and for which appropriate reserves, if necessary (in the
good faith judgment of management of the Issuers), are being maintained in
accordance with GAAP or where the failure to effect such payment will not be
disadvantageous to the Holders.

          SECTION 3.15. Payments for Consent. Neither the Company nor any of its
Restricted Subsidiaries will, directly or indirectly, pay or cause to be paid
any consideration, whether by way of interest, fees or otherwise, to any Holder
of any Securities for or as an inducement to any consent, waiver or amendment of
any of the terms or provisions of this Indenture or the Securities unless such
consideration is offered to be paid or is paid to all Holders of the Securities
that consent, waive or agree to amend in the time frame set forth in the
solicitation documents relating to such consent, waiver or amendment.

          SECTION 3.16. Compliance Certificate. The Issuers shall deliver to the
Trustee within 120 days after the end of each fiscal year of the Company an
Officers' Certificate stating that in the course of the performance by the
signers of their duties as Officers of the Issuers they would normally have
knowledge of any Default or Event of Default and whether or not the signers know
of any Default or Event of Default that occurred during the previous fiscal
year. If they do, the certificate shall describe the Default or Event of
Default, its status and the action the Issuers is taking or proposes to take
with respect thereto. The Issuers also shall comply with TIA Section 314(a)(4).

          SECTION 3.17. Further Instruments and Acts. Upon request of the
Trustee, the Issuers shall execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.

          SECTION 3.18. Limitation on Lines of Business. The Company shall not,
and shall not permit any Restricted Subsidiary to, engage in any business other
than a Related Business.

          SECTION 3.19. Statement by Officers as to Default. The Issuers shall
deliver to the Trustee, as soon as possible and in any event within 30 days
after the occurrence of any Event of Default or an event which, with notice or
the lapse of time or both, would constitute an Event of Default, an Officers'
Certificate setting forth the details of such Event of Default or Default, its
status and the actions which the Issuers are taking or propose to take with
respect thereto.

          SECTION 3.20. Restrictions on Activities. Stewart & Stevenson Corp.
will not hold any material assets, become liable for any material obligations or
engage in any significant business activities; provided, that Stewart &
Stevenson Corp. may be a co-obligor or guarantor with respect to Indebtedness if
the Company is an obligor on such Indebtedness and the net

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proceeds of such Indebtedness are received by the Company, Stewart & Stevenson
Corp. or one or more Subsidiary Guarantors. At any time after the Company is a
corporation, Stewart & Stevenson Corp. may consolidate or merge with or into the
Company or any Restricted Subsidiary.

                                   ARTICLE IV

                                SUCCESSOR COMPANY

          SECTION 4.1. Merger and Consolidation. The Company will not
consolidate with or merge with or into, or convey, transfer or lease all or
substantially all its assets to, any Person, unless:

          (1)  the resulting, surviving or transferee Person (the "Successor
               Company") will be a corporation, limited liability company or
               limited liability partnership organized and existing under the
               laws of the United States of America, any State of the United
               States or the District of Columbia and the Successor Company (if
               not the Company) will expressly assume, by supplemental
               indenture, executed and delivered to the Trustee, in form
               satisfactory to the Trustee, all the obligations of the Company
               under the Securities and this Indenture and will expressly
               assume, by written agreement all the obligations of the Company
               under the Registration Rights Agreement;

          (2)  immediately after giving effect to such transaction (and treating
               any Indebtedness that becomes an obligation of the Successor
               Company or any Subsidiary of the Successor Company as a result of
               such transaction as having been Incurred by the Successor Company
               or such Subsidiary at the time of such transaction), no Default
               or Event of Default shall have occurred and be continuing;

          (3)  immediately after giving effect to such transaction, the
               Successor Company would be able to Incur at least $1.00 of
               additional Indebtedness pursuant to the first paragraph of
               Section 3.2 or the Consolidated Coverage Ratio for the Successor
               Company and its Restricted Subsidiaries would be greater than
               such ratio for the Company and its Restricted Subsidiaries
               immediately prior to such transaction;

          (4)  each Subsidiary Guarantor (unless it is the other party to the
               transactions above, in which case clause (1) shall apply) shall
               have by supplemental indenture confirmed that its Subsidiary
               Guarantee shall apply to such Person's obligations in respect of
               this Indenture and the Securities and shall have by written
               agreement confirmed that its obligations under the Registration
               Rights Agreement shall continue to be in effect; and

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<PAGE>

          (5)  the Company shall have delivered to the Trustee an Officers'
               Certificate and an Opinion of Counsel, each stating that such
               consolidation, merger or transfer and such supplemental indenture
               (if any) comply with this Indenture.

For purposes of this Section 4.1, the sale, lease, conveyance, assignment,
transfer, or other disposition of all or substantially all of the properties and
assets of one or more Subsidiaries of the Company, which properties and assets,
if held by the Company instead of such Subsidiaries, would constitute all or
substantially all of the properties and assets of the Company on a consolidated
basis, shall be deemed to be the transfer of all or substantially all of the
properties and assets of the Company.

          The predecessor company shall be released from its obligations under
the Indenture and the Successor Company will succeed to, and be substituted for,
and may exercise every right and power of, the Company under this Indenture,
but, in the case of a lease of all or substantially all its assets, the
predecessor company will not be released from the obligation to pay the
principal of and interest on the Securities.

          Notwithstanding the preceding clause (3), (x) any Restricted
Subsidiary may consolidate with, merge into or transfer all or part of its
properties and assets to the Company and (y) the Company may merge with an
Affiliate incorporated solely for the purpose of reincorporating the Company in
another jurisdiction.

          In addition, the Company will not permit any Subsidiary Guarantor to
consolidate with, merge with or into any Person (other than another Subsidiary
Guarantor or the Company) and will not permit the conveyance, transfer or lease
of all or substantially all of the assets of any Subsidiary Guarantor (other
than to another Subsidiary Guarantor or the Company) unless:

          (1)  (a) if such entity remains a Subsidiary Guarantor, the resulting,
               surviving or transferee Person will be a corporation,
               partnership, trust or limited liability company organized and
               existing under the laws of the United States of America, any
               State of the United States or the District of Columbia; (b)
               immediately after giving effect to such transaction (and treating
               any Indebtedness that becomes an obligation of the resulting,
               surviving or transferee Person or any Restricted Subsidiary as a
               result of such transaction as having been Incurred by such Person
               or such Restricted Subsidiary at the time of such transaction),
               no Default of Event of Default shall have occurred and be
               continuing; and (c) the Company will have delivered to the
               Trustee an Officers' Certificate and an Opinion of Counsel, each
               stating that such consolidation, merger or transfer and such
               supplemental indenture (if any) comply with the Indenture; and

          (2)  the transaction is made in compliance with Section 3.7 (it being
               understood that only such portion of the Net Available Cash as is
               required to be applied on the date of such transaction in
               accordance with the terms of this Indenture needs to be applied
               in accordance therewith at such time) and this Section 4.1.

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                                    ARTICLE V

                            REDEMPTION OF SECURITIES

          SECTION 5.1. Redemption. The Securities may be redeemed, as a whole or
from time to time in part, subject to the conditions and at the redemption
prices specified in paragraph 5 of the form of Securities set forth in Exhibit A
hereto, which is hereby incorporated by reference and made a part of this
Indenture, together with accrued and unpaid interest, if any, to the Redemption
Date.

          SECTION 5.2. Applicability of Article. Redemption of Securities at the
election of the Issuers or otherwise, as permitted or required by any provision
of this Indenture, shall be made in accordance with such provision and this
Article.

          SECTION 5.3. Election to Redeem; Notice to Trustee. The election of
the Issuers to redeem any Securities pursuant to Section 5.1 shall be evidenced
by a Board Resolution of each of the Issuers. In case of any redemption at the
election of the Issuers, each of the Issuers shall, upon not later than the
earlier of the date that is 45 days prior to the Redemption Date fixed by the
Issuers or the date on which notice is given to the Holders (except as provided
in Section 5.5 or unless a shorter notice shall be satisfactory to the Trustee),
notify the Trustee of such Redemption Date and of the principal amount of
Securities to be redeemed and shall deliver to the Trustee such documentation
and records as shall enable the Trustee to select the Securities to be redeemed
pursuant to Section 5.4.

          SECTION 5.4. Selection by Trustee of Securities to Be Redeemed. If
less than all the Securities are to be redeemed at any time pursuant to an
optional redemption, the particular Securities to be redeemed shall be selected
not more than 40 days prior to the Redemption Date by the Trustee (unless a
shorter period shall be satisfactory to the Trustee), from the outstanding
Securities not previously called for redemption, in compliance with the
requirements of the principal national securities exchange, if any, on which
such Securities are listed, or, if such Securities are not so listed, on a pro
rata basis among the classes of Securities, by lot or by such other method as
the Trustee in its sole discretion shall deem fair and appropriate (and in such
manner as complies with applicable legal requirements) and which may provide for
the selection for redemption of portions of the principal of the Securities;
provided, however, that no such partial redemption shall reduce the portion of
the principal amount of a Security not redeemed to less than $1,000.

          The Trustee shall promptly notify the Issuers in writing of the
Securities selected for redemption and, in the case of any Securities selected
for partial redemption, the method it has chosen for the selection of Securities
and the principal amount thereof to be redeemed.

          For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to redemption of Securities shall relate, in
the case of any Security redeemed or to be redeemed only in part, to the portion
of the principal amount of such Security which has been or is to be redeemed.

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          SECTION 5.5. Notice of Redemption. Notice of redemption shall be
mailed not less than 30 nor more than 60 days prior to the Redemption Date, to
each Holder of Securities to be redeemed at such Holder's registered address. At
the Issuers' request, the Trustee shall give notice of redemption in the
Issuers' name and at the Issuers' expense; provided, however, that the Issuers
shall deliver to the Trustee, at least 45 days prior to the Redemption Date
(unless a shorter period shall be satisfactory to the Trustee), an Officers'
Certificate requesting that the Trustee give such notice at the Issuers' expense
and the form of notice that shall include the following items.

          All notices of redemption shall state:

          (1) the Redemption Date,

          (2) the redemption price and the amount of accrued interest to the
     Redemption Date payable as provided in Section 5.7, if any,

          (3) if less than all outstanding Securities are to be redeemed, the
     identification of the particular Securities (or portion thereof) to be
     redeemed, as well as the aggregate principal amount of Securities to be
     redeemed and the aggregate principal amount of Securities to be outstanding
     after such partial redemption,

          (4) in case any Security is to be redeemed in part only, the notice
     which relates to such Security shall state that on and after the Redemption
     Date, upon surrender of such Security, the Holder will receive, without
     charge, a new Security or Securities of authorized denominations for the
     principal amount thereof remaining unredeemed,

          (5) that on the Redemption Date the redemption price (and accrued
     interest, if any, to the Redemption Date payable as provided in Section
     5.7) will become due and payable upon each such Security, or the portion
     thereof, to be redeemed, and, unless the Issuers default in making the
     redemption payment, that interest on Securities called for redemption (or
     the portion thereof) will cease to accrue on and after said date,

          (6) the place or places where such Securities are to be surrendered
     for payment of the redemption price and accrued interest, if any,

          (7) the name and address of the Paying Agent,

          (8) that Securities called for redemption must be surrendered to the
     Paying Agent to collect the redemption price,

          (9) the CUSIP, Common Code and ISIN numbers, if applicable, and that
     no representation is made as to the accuracy or correctness of the CUSIP,
     Common Code and ISIN numbers, if applicable, if any, listed in such notice
     or printed on the Securities, and

          (10) the paragraph of the Securities pursuant to which the Securities
     are to be redeemed.

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          SECTION 5.6. Deposit of Redemption Price. Prior to 10:00 a.m., New
York City time, on any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if any of the Issuers or any of the Issuers'
Subsidiaries is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 2.4) an amount of money sufficient to pay the redemption
price of, and accrued interest on, all the Securities which are to be redeemed
on that date, other than Securities or portions of Securities called for
redemption that are beneficially owned by any of the Issuers and have been
delivered by any of the Issuers to the Trustee for cancellation.

          SECTION 5.7. Securities Payable on Redemption Date. Notice of
redemption having been given as aforesaid, the Securities or portions of
Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the redemption price therein specified (together with accrued
interest, if any, to the Redemption Date), and on and after such date (unless
the Company shall default in the payment of the redemption price and accrued
interest) such Securities shall cease to bear interest and the only right of the
Holders thereof will be to receive payment of the redemption price and, subject
to the next sentence, unpaid interest on such Securities to the Redemption Date.
Upon surrender of any such Security for redemption in accordance with said
notice, such Security shall be paid by the Company at the redemption price,
together with accrued interest, if any, to the Redemption Date (subject to the
rights of Holders of record on the relevant record date to receive interest due
on the relevant interest payment date).

          If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the unpaid principal (and premium, if any)
shall, until paid, bear interest from the Redemption Date at the rate borne by
the Securities.

          SECTION 5.8. Securities Redeemed in Part. Any Security which is to be
redeemed only in part (pursuant to the provisions of this Article) shall be
surrendered at the office or agency of the Issuers maintained for such purpose
pursuant to Section 3.12 (with, if the Issuers or the Trustee so require, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Issuers and the Trustee duly executed by the Holder thereof or such Holder's
attorney duly authorized in writing), and the Issuers shall execute, and the
Trustee shall authenticate and make available for delivery to the Holder of such
Security at the expense of the Issuers, a new Security or Securities, of any
authorized denomination as requested by such Holder, in an aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered, provided, that each such new Security will be in a
principal amount of $1,000 or in integral multiples in excess thereof.

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                                   ARTICLE VI

                              DEFAULTS AND REMEDIES

          SECTION 6.1. Events of Default. Each of the following is an "Event of
Default":

          (1)  default in any payment of interest or additional interest (as
               required by the Registration Rights Agreement) on any note when
               due, continued for 30 days;

          (2)  default in the payment of principal of or premium, if any, on any
               Security when due at its Stated Maturity, upon optional
               redemption, upon required repurchase, upon declaration or
               otherwise;

          (3)  failure by the Company to comply with its obligations under
               Section 4.1;

          (4)  failure by the Company to comply for 30 days after notice as
               provided below with any of its obligations under the covenants
               described in Section 3.9 above or the covenants described under
               Sections 3.2, 3.3. 3.4, 3.5, 3.6, 3.7, 3.8, 3.9, 3.11, 3.15, 3.18
               and 3.20 above (in each case, other than a failure to purchase
               Securities which constitutes an Event of Default under clause (2)
               above);

          (5)  failure by the Company to comply for 60 days after notice as
               provided below with its other agreements contained in this
               Indenture;

          (6)  default under any mortgage, indenture or instrument under which
               there may be issued or by which there may be secured or evidenced
               any Indebtedness for money borrowed by the Company or any of its
               Restricted Subsidiaries (or the payment of which is guaranteed by
               the Company or any of its Restricted Subsidiaries), other than
               Indebtedness owed to the Company or a Restricted Subsidiary,
               whether such Indebtedness or guarantee now exists, or is created
               after the Issue Date, which default:

               (a)  is caused by a failure to pay principal of, or interest or
                    premium, if any, on such Indebtedness prior to the
                    expiration of the grace period provided in such Indebtedness
                    ("payment default"); or

               (b)  results in the acceleration of such Indebtedness prior to
                    its maturity (the "cross acceleration provision");

               and, in each case, the principal amount of any such Indebtedness,
               together with the principal amount of any other such Indebtedness
               under which there has been a payment default or the maturity of
               which has been so accelerated, aggregates $10 million or more;

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          (7)  where the Company or a Significant Subsidiary or group of
               Restricted Subsidiaries that, taken together (as of the latest
               audited consolidated financial statements for the Company and its
               Restricted Subsidiaries), would constitute a Significant
               Subsidiary pursuant to or within the meaning of Bankruptcy Law:

               (a)  commences a voluntary case,

               (b)  consents to the entry of an order for relief against it in
                    an involuntary case,

               (c)  consents to the appointment of a custodian of it or for all
                    or substantially all of its property, or

               (d)  makes a general assignment for the benefit of its creditors;

               or where a court of competent jurisdiction enters an order or
               decree under any Bankruptcy Law that:

               (a)  is for relief against the Company or any of its Restricted
                    Subsidiaries that is a Significant Subsidiary or any group
                    of Restricted Subsidiaries of the Company that, taken
                    together, would constitute a Significant Subsidiary in an
                    involuntary case;

               (b)  appoints a custodian of the Company or any of its Restricted
                    Subsidiaries that is a Significant Subsidiary or any group
                    of Restricted Subsidiaries of the Company that, taken
                    together, would constitute a Significant Subsidiary or for
                    all or substantially all of the property of the Company or
                    any of its Restricted Subsidiaries that is a Significant
                    Subsidiary or any group of Restricted Subsidiaries of the
                    Company that, taken together, would constitute a Significant
                    Subsidiary; or

               (c)  orders the liquidation of the Company or any of its
                    Restricted Subsidiaries that is a Significant Subsidiary or
                    any group of Restricted Subsidiaries of the Company that,
                    taken together, would constitute a Significant Subsidiary;

               and the order or decree remains unstayed and in effect for 60
               consecutive days;

          (8)  failure by the Company or any Significant Subsidiary or group of
               Restricted Subsidiaries that, taken together (as of the latest
               audited consolidated financial statements for the Company and its
               Restricted Subsidiaries), would constitute a Significant
               Subsidiary to pay final judgments aggregating in excess of $10
               million (net of any amounts that a reputable and creditworthy
               insurance company has acknowledged liability

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               for in writing), which judgments are not paid, discharged or
               stayed for a period of 60 days; or

          (9)  any Subsidiary Guarantee of a Significant Subsidiary ceases to be
               in full force and effect (except as contemplated by the terms of
               this Indenture) or is declared null and void in a judicial
               proceeding or any Subsidiary Guarantor denies or disaffirms its
               obligations under this Indenture or its Subsidiary Guarantee.

However, a default under clauses (4) and (5) of this Section will not constitute
an Event of Default until the Trustee or the Holders of 25% in principal amount
of the outstanding Securities notify the Company of the default and the Company
does not cure such default within the time specified in clauses (4) and (5) of
this Section after receipt of such notice.

          SECTION 6.2. Acceleration. If an Event of Default (other than an Event
of Default described in clause (7) above) occurs and is continuing, the Trustee
by notice to the Company, or the Holders of at least 25% in principal amount of
the outstanding Securities by notice to the Company and the Trustee, may, and
the Trustee at the request of such Holders shall, declare the principal of,
premium, if any, and accrued and unpaid interest, if any, on all the Securities
to be due and payable. Upon such a declaration, such principal, premium and
accrued and unpaid interest will be due and payable immediately. In the event of
a declaration of acceleration of the Securities because an Event of Default
described in clause (6) above has occurred and is continuing, the declaration of
acceleration of the Securities shall be automatically annulled if the default
triggering such Event of Default pursuant to clause (6) shall be remedied or
cured by the Company or a Restricted Subsidiary or waived by the holders of the
relevant Indebtedness within 20 days after the declaration of acceleration with
respect thereto and if (1) the annulment of the acceleration of the Securities
would not conflict with any judgment or decree of a court of competent
jurisdiction and (2) all existing Events of Default, except nonpayment of
principal, premium or interest on the Securities that became due solely because
of the acceleration of the Securities, have been cured or waived. If an Event of
Default described in clause (7) above occurs and is continuing, the principal
of, premium, if any, and accrued and unpaid interest on all the Securities will
become and be immediately due and payable without any declaration or other act
on the part of the Trustee or any Holders.

          SECTION 6.3. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of principal of (or premium, if any) or
interest on the Securities or to enforce the performance of any provision of the
Securities or this Indenture.

          The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.

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          SECTION 6.4. Waiver of Past Defaults. The Holders of a majority in
principal amount of the outstanding Securities may waive all past defaults
(except with respect to nonpayment of principal, premium or interest) and
rescind any such acceleration with respect to the Securities and its
consequences if (1) rescission would not conflict with any judgment or decree of
a court of competent jurisdiction and (2) all existing Events of Default, other
than the nonpayment of the principal of, premium, if any, and interest on the
Securities that have become due solely by such declaration of acceleration, have
been cured or waived.

          SECTION 6.5. Control by Majority. The Holders of a majority in
principal amount of the outstanding Securities may direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture or that
the Trustee determines is unduly prejudicial to the rights of any other Holder
or that would involve the Trustee in personal liability. Prior to taking any
action hereunder, the Trustee will be entitled to indemnification satisfactory
to it in its sole discretion against all losses and expenses caused by taking or
not taking such action.

          SECTION 6.6. Limitation on Suits. Subject to the provisions of this
Indenture relating to the duties of the Trustee, if an Event of Default occurs
and is continuing, the Trustee shall be under no obligation to exercise any of
the rights or powers under this Indenture at the request or direction of any of
the Holders unless such Holders have offered to the Trustee reasonable indemnity
or security satisfactory to it against any loss, liability or expense. Except to
enforce the right to receive payment of principal, premium, if any, or interest
when due, no Holder may pursue any remedy with respect to this Indenture or the
Securities unless:

          (1) such Holder has previously given the Trustee notice that an Event
     of Default is continuing;

          (2) Holders of at least 25% in principal amount of the outstanding
     Securities have requested in writing that the Trustee pursue the remedy;

          (3) such Holder or Holders have offered the Trustee reasonable
     security or indemnity satisfactory to it against any loss, liability or
     expense;

          (4) the Trustee has not complied with such request within 60 days
     after the receipt of the request and the offer of security or indemnity;
     and

          (5) the Holders of a majority in principal amount of the outstanding
     Securities have not given the Trustee a direction that, in the opinion of
     the Trustee, is inconsistent with such request within such 60-day period.

          SECTION 6.7. Rights of Holders to Receive Payment. Notwithstanding any
other provision of this Indenture (including, without limitation, Section 6.6),
the right of any Holder to receive payment of principal of, premium, if any, or
interest on the Securities held by such Holder, on or after the respective due
dates expressed in the Securities, or to bring suit for the enforcement of any
such payment on or after such respective dates, shall not be impaired or
affected without the consent of such Holder.

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          SECTION 6.8. Collection Suit by Trustee. If an Event of Default
specified in clauses (1) or (2) of Section 6.1 occurs and is continuing, the
Trustee may recover judgment in its own name and as trustee of an express trust
against any of the Issuers for the whole amount then due and owing (together
with interest on any unpaid interest to the extent lawful) and the amounts
provided for in Section 7.7.

          SECTION 6.9. Trustee May File Proofs of Claim. The Trustee may file
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee (including any claim for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel) and the Holders allowed in any judicial
proceedings relative to the Issuers, its Restricted Subsidiaries or its or their
respective creditors or properties and, unless prohibited by law or applicable
regulations, may be entitled and empowered to participate as a member of any
official committee of creditors appointed in such matter and may vote on behalf
of the Holders in any election of a trustee in bankruptcy or other Person
performing similar functions, and any Custodian in any such judicial proceeding
is hereby authorized by each Holder to make payments to the Trustee and, in the
event that the Trustee shall consent to the making of such payments directly to
the Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and its counsel, and any other amounts due the Trustee under Section 7.7.

          SECTION 6.10. Priorities. If the Trustee collects any money or
property pursuant to this Article VI, it shall pay out the money or property in
the following order:

          FIRST: to the Trustee for amounts due under Section 7.7;

          SECOND: to Holders for amounts due and unpaid on the Securities for
     principal, premium, if any, and interest, ratably, without preference or
     priority of any kind, according to the amounts due and payable on the
     Securities for principal and interest, respectively; and

          THIRD: to the Issuers.

          The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section. At least 15 days before such record date, the
Issuers shall mail to each Holder and the Trustee a notice that states the
record date, the payment date and amount to be paid.

          SECTION 6.11. Undertaking for Costs. In any suit for the enforcement
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees and expenses, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section does not apply to a
suit by the Trustee, a suit by a Holder pursuant to Section 6.7 or a suit by
Holders of more than 25% in outstanding principal amount of the Securities.

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                                   ARTICLE VII

                                     TRUSTEE

          SECTION 7.1. Duties of Trustee. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and use the same degree of care and skill in
their exercise as a prudent Person would exercise or use under the circumstances
in the conduct of such Person's own affairs.

          (b) Except during the continuance of an Event of Default:

          (1) the Trustee undertakes to perform such duties and only such duties
     as are specifically set forth in this Indenture and no implied covenants or
     obligations shall be read into this Indenture against the Trustee; and

          (2) in the absence of bad faith on its part, the Trustee may
     conclusively rely, as to the truth of the statements and the correctness of
     the opinions expressed therein, upon certificates, opinions or orders
     furnished to the Trustee and conforming to the requirements of this
     Indenture. However, in the case of any such certificates or opinions which
     by any provisions hereof are specifically required to be furnished to the
     Trustee, the Trustee shall examine such certificates and opinions to
     determine whether or not they conform to the requirements of this Indenture
     (but need not confirm or investigate the accuracy of mathematical
     calculations or other facts stated therein).

          (c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:

          (1) this paragraph does not limit the effect of paragraph (b) of this
     Section;

          (2) the Trustee shall not be liable for any error of judgment made in
     good faith by a Trust Officer unless it is proved that the Trustee was
     negligent in ascertaining the pertinent facts; and

          (3) the Trustee shall not be liable with respect to any action it
     takes or omits to take in good faith in accordance with a direction
     received by it pursuant to Section 6.5.

          (d) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Issuers.

          (e) Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law.

          (f) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur financial liability in the performance
of any of its duties hereunder or in the exercise of any of its rights or
powers, if it shall have reasonable grounds to believe that repayment of such
funds or adequate indemnity against such risk or liability is not reasonably
assured to it.

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          (g) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.

          (h) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Issuers shall be sufficient if
signed by an Officer of the Issuers.

          (i) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders shall have offered to the Trustee
reasonable security or indemnity satisfactory to it, in its sole discretion,
against the costs, expenses (including reasonable attorneys' fees and expenses)
and liabilities that might be incurred by it in compliance with such request or
direction.

          SECTION 7.2. Rights of Trustee. Subject to Section 7.1:

          (a) The Trustee may conclusively rely on any document (whether in its
original or facsimile form) reasonably believed by it to be genuine and to have
been signed or presented by the proper person. The Trustee need not investigate
any fact or matter stated in the document. The Trustee shall receive and retain
financial reports and statements of the Issuers as provided herein, but shall
have no duty to review or analyze such reports or statements to determine
compliance under covenants or other obligations of the Issuers.

          (b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate and/or an Opinion of Counsel. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on an
Officers' Certificate or Opinion of Counsel.

          (c) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent appointed with due
care.

          (d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within its rights or
powers, unless the Trustee's conduct constitutes willful misconduct or
negligence.

          (e) The Trustee may consult with counsel of its selection, and the
advice or opinion of counsel with respect to legal matters relating to this
Indenture and the Securities shall be full and complete authorization and
protection from liability in respect of any action taken, omitted or suffered by
it hereunder in good faith and in accordance with the advice or opinion of such
counsel.

          (f) The Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Trust Officer of the Trustee has actual knowledge
thereof or unless written notice of any event which is in fact such a default is
received by the Trustee at the corporate trust office of the Trustee specified
in Section 11.2, and such notice references the Securities and this Indenture.

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          (g) The rights, privileges, protections, immunities and benefits given
to the Trustee, including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and to each agent, custodian and other Person employed to act
hereunder.

          (h) The Trustee shall not be deemed to have knowledge of any fact or
matter unless such fact or matter is known to a Trust Officer of the Trustee.

          (i) Whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may request, and in the absence of bad faith
or willful misconduct on its part, rely upon an Officers' Certificate and an
Opinion of Counsel.

          SECTION 7.3. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Issuers, Subsidiary Guarantors or their
Affiliates with the same rights it would have if it were not Trustee. Any Paying
Agent, Registrar, co-registrar or co-paying agent may do the same with like
rights. However, the Trustee must comply with Sections 7.10 and 7.11. In
addition, the Trustee shall be permitted to engage in transactions with the
Issuers; provided, however, that if the Trustee acquires any conflicting
interest, as defined in TIA Section 310(b), the Trustee must (i) eliminate such
conflict within 90 days of acquiring such conflicting interest, (ii) apply to
the SEC for permission to continue acting as Trustee or (iii) resign.

          SECTION 7.4. Trustee's Disclaimer. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture or the Securities, shall not be accountable for the Issuers' use
of the proceeds from the sale of the Securities, shall not be responsible for
the use or application of any money received by any Paying Agent other than the
Trustee or any money paid to the Issuers pursuant to the terms of this Indenture
and shall not be responsible for any statement of the Issuers in this Indenture
or in any document issued in connection with the sale of the Securities or in
the Securities other than the Trustee's certificate of authentication.

          SECTION 7.5. Notice of Defaults. If a Default occurs and is continuing
and is known to the Trustee, the Trustee must mail to each Holder notice of the
Default within 90 days after it occurs. Except in the case of a Default in the
payment of principal of, premium, if any, or interest on any Security, the
Trustee may withhold notice if and so long as a Trust Officer or a committee of
Trust Officers of the Trustee in good faith determines that withholding notice
is in the interests of the Holders. In addition, the Company is required to
deliver to the Trustee, within 120 days after the end of each fiscal year, a
certificate indicating whether the signers thereof know of any Default that
occurred during the previous year. The Company also is required to deliver to
the Trustee, within 30 days after the occurrence thereof, written notice of any
events which would constitute certain Defaults, their status and what action the
Company is taking or proposing to take in respect thereof.

          SECTION 7.6. Reports by Trustee to Holders. As promptly as practicable
after each May 15 following the date of this Indenture beginning May 15, 2007,
and in any event prior

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to June 15 in each year, the Trustee shall mail to each Securityholder a brief
report dated as of such mail date that complies with TIA Section 313(a) if and
to the extent required thereby. The Trustee also shall comply with TIA Section
313(b) and TIA Section 313(c).

          A copy of each report at the time of its mailing to Securityholders
shall be filed with the SEC and each stock exchange (if any) on which the
Securities are listed. The Issuers agrees to notify promptly the Trustee
whenever the Securities become listed on any stock exchange and of any delisting
thereof and the Trustee shall comply with TIA Section 313(d).

          SECTION 7.7. Compensation and Indemnity. The Issuers shall pay to the
Trustee from time to time reasonable compensation for its acceptance of this
Indenture and services hereunder as the Issuers and the Trustee shall from time
to time agree in writing. The Trustee's compensation shall not be limited by any
law on compensation of a trustee of an express trust. The Issuers shall
reimburse the Trustee upon request for all reasonable out-of-pocket expenses
incurred or made by it, including costs of collection, costs of preparing and
reviewing reports, certificates and other documents, costs of preparation and
mailing of notices to Securityholders and reasonable fees and expenses of
counsel retained by the Trustee, in addition to the compensation for its
services. Such expenses shall include the reasonable compensation and expenses,
disbursements and advances of the Trustee's agents, counsel, accountants and
experts. The Issuers shall indemnify the Trustee against any and all loss,
liability, damages, claims or expense (including reasonable attorneys' fees and
expenses) incurred by it without negligence, bad faith or willful misconduct on
its part in connection with the administration of this trust and the performance
of its duties hereunder, including the costs and expenses of enforcing this
Indenture (including this Section 7.7) and of defending itself against any
claims (whether asserted by any Securityholder, the Issuers or otherwise). The
Trustee shall notify the Issuers promptly of any claim for which it may seek
indemnity. Failure by the Trustee to so notify the Issuers shall not relieve the
Issuers of its obligations hereunder. The Issuers shall defend the claim and the
Trustee shall provide reasonable cooperation at the Issuers' expense in the
defense. The Trustee may have separate counsel and the Issuers shall pay the
fees and expenses of such counsel, provided that the Issuers shall not be
required to pay such fees and expenses if they assume the Trustee's defense,
and, in the reasonable judgment of outside counsel to the Trustee, there is no
conflict of interest between the Issuers and the Trustee in connection with such
defense. Notwithstanding the foregoing, the Issuers and the Subsidiary
Guarantors need not reimburse any expense or indemnify against any loss,
liability or expense which is finally determined by a court of competent
jurisdiction to have been incurred by the Trustee through the Trustee's own
willful misconduct, negligence or bad faith.

          To secure the Issuers' payment obligations in this Section, the
Trustee shall have a lien prior to the Securities on all money or property held
or collected by the Trustee other than money or property held in trust to pay
principal of and interest on particular Securities. Such lien shall survive the
satisfaction and discharge of this Indenture. The Trustee's right to receive
payment of any amounts due under this Section 7.7 shall not be subordinate to
any other liability or Indebtedness of the Issuers.

          The Issuers' payment obligations pursuant to this Section shall
survive the discharge of this Indenture. When the Trustee incurs expenses after
the occurrence of a Default

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specified in clause (7) of Section 6.1 with respect to the Issuers, the expenses
are intended to constitute expenses of administration under any Bankruptcy Law.

          SECTION 7.8. Replacement of Trustee. The Trustee may resign at any
time by so notifying the Issuers in writing. The Holders of a majority in
principal amount of the Securities may remove the Trustee by so notifying the
removed Trustee in writing and may appoint a successor Trustee with the Issuers'
written consent, which consent will not be unreasonably withheld. The Issuers
shall remove the Trustee if:

          (1)  the Trustee fails to comply with Section 7.10;

          (2)  the Trustee is adjudged bankrupt or insolvent;

          (3)  a receiver or other public officer takes charge of the Trustee or
               its property; or

          (4)  the Trustee otherwise becomes incapable of acting as trustee
               hereunder.

          If the Trustee resigns or is removed by the Issuers or by the Holders
of a majority in principal amount of the Securities and such Holders do not
reasonably promptly appoint a successor Trustee as described in the preceding
paragraph, or if a vacancy exists in the office of the Trustee for any reason
(the Trustee in such event being referred to herein as the retiring Trustee),
the Issuers shall promptly appoint a successor Trustee.

          A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuers. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Securityholders. The retiring Trustee, upon payment of its charges
hereunder, shall promptly transfer all property held by it as Trustee to the
successor Trustee, subject to the lien provided for in Section 7.7.

          If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee or the Holders of
at least 25% in principal amount of the Securities may petition, at the Issuers'
expense, any court of competent jurisdiction for the appointment of a successor
Trustee.

          If the Trustee fails to comply with Section 7.10, unless the Trustee's
duty to resign is stayed as provided in TIA Section 310(b), any Securityholder,
who has been a bona fide Holder of a Security for at least six months, may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.

          Notwithstanding the replacement of the Trustee pursuant to this
Section, the Issuers' obligations under Section 7.7 shall continue for the
benefit of the retiring Trustee.

          SECTION 7.9. Successor Trustee by Merger. If the Trustee consolidates
with, merges or converts into, or transfers all or substantially all its
corporate trust business or assets

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to, another corporation or banking association, the resulting, surviving or
transferee corporation without any further act shall be the successor Trustee.

          In case at the time such successor or successors by merger, conversion
or consolidation to the Trustee shall succeed to the trusts created by this
Indenture, any of the Securities shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Securities so
authenticated; and in case at that time any of the Securities shall not have
been authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor hereunder or in the name of the
successor to the Trustee; provided that the right to adopt the certificate of
authentication of any predecessor Trustee or authenticate Securities in the name
of any predecessor Trustee shall only apply to its successor or successors by
merger, consolidation or conversion.

          SECTION 7.10. Eligibility; Disqualification. This Indenture shall
always have a Trustee that satisfies the requirements of TIA Section 310(a)(1),
(2) and (5) in every respect. The Trustee shall have a combined capital and
surplus of at least $100 million as set forth in its most recent published
annual report of condition. The Trustee shall comply with TIA Section 310(b);
provided, however, that there shall be excluded from the operation of TIA
Section 310(b)(1) any indenture or indentures under which other securities or
certificates of interest or participation in other securities of the Issuers are
outstanding if the requirements for such exclusion set forth in TIA Section
310(b)(1) are met.

          SECTION 7.11. Preferential Collection of Claims Against the Issuers.
The Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated.

          SECTION 7.12. Trustee's Application for Instruction from the Issuers.
Any application by the Trustee for written instructions from the Issuers may, at
the option of the Trustee, set forth in writing any action proposed to be taken
or omitted by the Trustee under this Indenture and the date on and/or after
which such action shall be taken or such omission shall be effective. The
Trustee shall not be liable for any action taken by, or omission of, the Trustee
in accordance with a proposal included in such application on or after the date
specified in such application (which date shall not be less than three Business
Days after the date any officer of the Issuers actually receives such
application, unless any such officer shall have consented in writing to any
earlier date) unless prior to taking any such action (or the effective date in
the case of an omission), the Trustee shall have received written instructions
in response to such application specifying the action to be taken or omitted.

          SECTION 7.13. Paying Agents. The Issuers shall cause each Paying Agent
other than the Trustee to execute and deliver to it and the Trustee an
instrument in which such agent shall agree with the Trustee, subject to the
provisions of this Section 7.13:

          (1) that it will hold all sums held by it as agent for the payment of
     principal of, or premium, if any, or interest on, the Securities (whether
     such sums have been paid to

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     it by the Issuers or by any obligor on the Securities) in trust for the
     benefit of Holders of the Securities or the Trustee;

          (2) that it will at any time during the continuance of any Event of
     Default, upon written request from the Trustee, deliver to the Trustee all
     sums so held in trust by it together with a full accounting thereof; and

          (3) that it will give the Trustee written notice within three Business
     Days of any failure of the Issuers (or by any obligor on the Securities) in
     the payment of any installment of the principal of, premium, if any, or
     interest on, the Securities when the same shall be due and payable.

                                  ARTICLE VIII

                             DISCHARGE OF INDENTURE;

                                   DEFEASANCE

          SECTION 8.1. Discharge of Liability on Securities; Defeasance. (a)
Subject to Section 8.1(c), when (i)(x) the Issuers deliver to the Trustee all
outstanding Securities (other than Securities replaced pursuant to Section 2.9)
for cancellation or (y) all outstanding Securities not theretofore delivered for
cancellation have become due and payable, whether at maturity or upon redemption
or will become due and payable within one year or are to be called for
redemption within one year under arrangements satisfactory to the Trustee for
the giving of notice of redemption pursuant to Article V hereof and the Issuers
or any Subsidiary Guarantor irrevocably deposits or causes to be deposited with
the Trustee as trust funds in trust solely for the benefit of the Holders money
in U.S. dollars, U.S. Government Obligations, or a combination thereof, in such
amounts as will be sufficient, in the opinion of a nationally recognized firm of
independent accountants, without consideration of any reinvestment of interest
to pay and discharge the entire indebtedness on such Securities not theretofore
delivered to the Trustee for cancellation for principal, premium, if any, and
accrued interest to the date of maturity or redemption; (ii) no Default or Event
of Default shall occur as a result of such deposit and such deposit will not
result in a breach or violation of, or constitute a default under, any other
instrument to which the Issuers or any Subsidiary Guarantor is a party or by
which the Issuers or any Subsidiary Guarantor is bound; (iii) the Issuers or any
Subsidiary Guarantor has paid or caused to be paid all sums payable under this
Indenture and the Securities; and (iv) the Issuers has delivered irrevocable
instructions to the Trustee under this Indenture to apply the deposited money
toward the payment of such Securities at maturity or the Redemption Date, as the
case may be, then upon demand of the Issuers (accompanied by an Officers'
Certificate and an Opinion of Counsel stating that all conditions precedent
specified herein relating to the satisfaction and discharge of this Indenture
have been complied with) this Indenture shall cease to be of further effect with
respect to the Securities and the Trustee shall acknowledge satisfaction and
discharge of this Indenture, at the cost and expense of the Issuers.

          (b) Subject to Sections 8.1(c) and 8.2, any of the Issuers at any time
may terminate (i) all its obligations under the Securities and this Indenture
("legal defeasance

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option"), and after giving effect to such legal defeasance, any omission to
comply with such obligations shall no longer constitute a Default or Event of
Default or (ii) their obligations under Sections 3.2, 3.3, 3.4, 3.5, 3.6, 3.7,
3.8, 3.9, 3.10, 3.11, 3.12, 3.14, 3.15, 3.16, 3.18, 3.19, 3.20 and 4.1(3), and
the Issuers may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply with such
covenants shall no longer constitute a Default or an Event of Default under
Sections 6.1(3) (only with respect to Section 4.1(3)), 6.1(4), 6.1(5), 6.1(6),
6.1(7) (with respect to Significant Subsidiaries), 6.1(8) and 6.1(9), and the
events specified in such Sections shall no longer constitute an Event of Default
(clause (ii) being referred to as the "covenant defeasance option"), but except
as specified above, the remainder of this Indenture and the Securities shall be
unaffected thereby. Each of the Issuers may exercise its legal defeasance option
notwithstanding its prior exercise of its covenant defeasance option.

          If any of the Issuers exercises its legal defeasance option, payment
of the Securities may not be accelerated because of an Event of Default and the
Subsidiary Guarantees in effect at such time shall terminate. If any of the
Issuers exercises its covenant defeasance option, payment of the Securities may
not be accelerated because of an Event of Default specified in Sections 6.1(3)
(only with respect to Section 4.1(3)), 6.1(4), 6.1(5), 6.1(6), 6.1(7) (with
respect only to Significant Subsidiaries), 6.1(8) or 6.1(9).

          Upon satisfaction of the conditions set forth herein and upon request
of the Issuers, the Trustee shall acknowledge in writing the discharge of those
obligations that the Issuers terminate.

          (c) Notwithstanding the provisions of Sections 8.1(a) and (b), the
Issuers' obligations in Sections 2.2, 2.3, 2.4, 2.5, 2.6, 2.9, 2.10, 2.11, 2.12,
3.1, 3.13, 3.17, 6.7, 7.7 and 7.8 and in this Article VIII shall survive until
the Securities have been paid in full. After the Securities have been paid in
full, only the Issuers' obligations in Sections 7.7, 8.4 and 8.5 shall survive.

          SECTION 8.2. Conditions to Defeasance. Each of the Issuers may
exercise its legal defeasance option or its covenant defeasance option only if:

          (1)  such Issuer irrevocably deposits in trust with the Trustee for
               the benefit of the Holders money in U.S. dollars or U.S.
               Government Obligations or a combination thereof, the principal of
               and interest (without reinvestment) on which will be sufficient,
               or a combination thereof sufficient, for the payment of principal
               of, premium, if any, and interest on the Securities to maturity
               or redemption, as the case may be;

          (2)  such Issuer delivers to the Trustee a certificate from a
               nationally recognized firm of independent accountants expressing
               their opinion that the payments of principal and interest when
               due and without reinvestment on the deposited U.S. Government
               Obligations plus any deposited money without investment will
               provide cash at such times and in such amounts as

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               will be sufficient to pay principal and interest when due on all
               the Securities to maturity or redemption, as the case may be;

          (3)  no Default or Event of Default shall have occurred and be
               continuing as a result of such deposit or, with respect to
               certain bankruptcy or insolvency Events of Default, on the later
               of (i) the 91st day after such date of deposit or (ii) the day
               ending on the day following the expiration of the longest
               preference period under any bankruptcy law applicable to the
               Issuer in respect of such deposit;

          (4)  such legal defeasance or covenant defeasance shall not result in
               a breach or violation of, or constitute a default under any other
               agreement or instrument to which the Issuer or any of its
               Subsidiaries is a party or by which the Issuer or any of its
               Subsidiaries is bound;

          (5)  such Issuer shall have delivered to the Trustee an Opinion of
               Counsel (subject to customary assumptions and exclusions) to the
               effect that (A) the Securities and (B) assuming no intervening
               bankruptcy of such Issuer between the date of deposit and the
               91st day following the deposit and that no Holder of the
               Securities is an insider of such Issuer, after the 91st day
               following the deposit, the trust funds, will not be subject to
               the effect of any applicable bankruptcy, insolvency,
               reorganization or similar laws affecting creditors' rights
               generally;

          (6)  such Issuer delivers to the Trustee an Opinion of Counsel
               (subject to customary assumptions and exclusions) to the effect
               that the trust resulting from the deposit does not constitute, or
               is qualified as, a regulated investment company under the
               Investment Company Act of 1940;

          (7)  in the case of the legal defeasance option, such Issuer shall
               have delivered to the Trustee an Opinion of Counsel (subject to
               customary assumptions and exclusions) in the United States
               stating that (i) such Issuer has received from, or there has been
               published by, the Internal Revenue Service a ruling, or (ii)
               since the date of this Indenture there has been a change in the
               applicable federal income tax law, in either case to the effect
               that, and based thereon such Opinion of Counsel shall confirm
               that, the Securityholders will not recognize income, gain or loss
               for federal income tax purposes as a result of such deposit and
               legal defeasance and will be subject to federal income tax on the
               same amount, in the same manner and at the same times as would
               have been the case if such deposit and legal defeasance had not
               occurred;

          (8)  in the case of the covenant defeasance option, such Issuer shall
               have delivered to the Trustee an Opinion of Counsel (subject to
               customary assumptions and exclusions) in the United States to the
               effect that the Securityholders will not recognize income, gain
               or loss for federal income tax purposes as a result of such
               deposit and covenant defeasance and will

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               be subject to federal income tax on the same amount, in the same
               manner and at the same times as would have been the case if such
               deposit and covenant defeasance had not occurred; and

          (9)  such Issuer delivers to the Trustee an Officers' Certificate and
               an Opinion of Counsel, each stating that all conditions precedent
               to either the legal defeasance or covenant defeasance, as the
               case may be, as contemplated by this Article VIII have been
               complied with.

          SECTION 8.3. Application of Trust Money. The Trustee shall hold in
trust all money or U.S. Government Obligations (including proceeds thereof)
deposited with it pursuant to this Article VIII. It shall apply the deposited
money and the money from U.S. Government Obligations through the Paying Agent
and in accordance with this Indenture and the Securities to the Holders of the
Securities of all sums due in respect of the payment of principal of, premium,
if any, and accrued interest on the Securities.

          SECTION 8.4. Repayment to the Issuers. The Trustee and the Paying
Agent shall promptly turn over to the Company upon request any excess money,
U.S. Government Obligations or securities held by them upon payment of all the
obligations under this Indenture.

          Subject to any applicable abandoned property law, the Trustee and the
Paying Agent shall pay to the Company upon request any money held by them for
the payment of principal of or premium, if any, or interest on the Securities
that remains unclaimed by the Holders thereof for two years, and, thereafter,
Securityholders entitled to the money must look to the Company for payment as
unsecured general creditors.

          SECTION 8.5. Indemnity for U.S. Government Obligations. Each of the
Issuers shall pay and shall indemnify the Trustee against any tax, fee or other
charge imposed on or assessed against deposited U.S. Government Obligations or
the principal and interest received on such U.S. Government Obligations.

          SECTION 8.6. Reinstatement. If the Trustee or Paying Agent is unable
to apply any money or U.S. Government Obligations in accordance with this
Article VIII by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the obligations of the Issuers and each
Subsidiary Guarantor under this Indenture and the Securities shall be revived
and reinstated as though no deposit had occurred pursuant to this Article VIII
until such time as the Trustee or Paying Agent is permitted to apply all such
money or U.S. Government Obligations in accordance with this Article VIII;
provided, however, that, if the Issuers or the Subsidiary Guarantors have made
any payment of principal, premium, if any, interest on or principal of any
Securities because of the reinstatement of its obligations, the Issuers or
Subsidiary Guarantors, as the case may be, shall be subrogated to the rights of
the Holders of such Securities to receive such payment from the money or U.S.
Government Obligations held by the Trustee or Paying Agent.

          The Trustee's rights under this Article VIII shall survive termination
of this Indenture.

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                                   ARTICLE IX

                                   AMENDMENTS

          SECTION 9.1. Without Consent of Holders. Notwithstanding Section 9.02
of this Indenture, each of the Issuers, the Subsidiary Guarantors and the
Trustee may amend or supplement this Indenture or the Securities or the
Subsidiary Guarantees without consent of any Securityholder:

          (1) to cure any ambiguity, omission, defect or inconsistency;

          (2) to provide for the assumption by a Successor Company of the
     obligations of the Issuers or the assumption by a successor Person of the
     obligations of any Issuer or Subsidiary Guarantor under this Indenture;

          (3) to provide for uncertificated Securities in addition to or in
     place of certificated Securities; provided, however, that the
     uncertificated Securities are issued in registered form for purposes of
     Section 163(f) of the Code or in a manner such that the uncertificated
     Securities are described in Section 163(f)(2)(B) of the Code;

          (4) to add Guarantees with respect to the Securities or release a
     Subsidiary Guarantor upon its designation as an Unrestricted Subsidiary;
     provided, however, that the designation is in accord with the applicable
     provisions of this Indenture;

          (5) to secure the Securities;

          (6) to add to the covenants of each of the Issuers and the Restricted
     Subsidiaries for the benefit of the Holders or surrender any right or power
     conferred upon the Issuers;

          (7) to make any change that does not adversely affect the legal rights
     of any Holder;

          (8) to comply with any requirement of the SEC in connection with the
     qualification of this Indenture under the TIA;

          (9) to provide for the issuance of the Exchange Securities which will
     have terms substantially identical in all respects to the Initial
     Securities or the Additional Securities, as the case may be (except that
     the transfer restrictions contained in the Initial Securities or the
     Additional Securities, if any, shall be modified or eliminated, as
     appropriate), and which shall be treated, together with any outstanding
     Initial Securities or Additional Securities, as a single class of
     securities;

          (10) to provide for the appointment of a successor trustee, provided
     that the successor trustee be otherwise qualified and eligible to act as
     such under the terms of this Indenture; or

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          (11) upon receipt of an Officers' Certificate stating that a provision
     in the "Description of notes" included in the offering memorandum related
     to the Initial Securities is intended to be a verbatim recitation of a
     provision of this Indenture, the Securities or the Subsidiary Guarantees,
     to conform the text of this Indenture, the Securities or the Subsidiary
     Guarantees to such provision of the "Description of notes".

          After an amendment or supplement under this Section becomes effective,
the Issuers shall mail to Securityholders a notice briefly describing such
amendment or supplement. The failure to give such notice to all Securityholders,
or any defect therein, shall not impair or affect the validity of an amendment
or supplement under this Section.

          SECTION 9.2. With Consent of Holders. Each of the Issuers, the
Subsidiary Guarantors and the Trustee may amend or supplement this Indenture or
the Securities without notice to any Securityholder but with the written consent
of the Holders of at least a majority in principal amount of the Securities then
outstanding (including, without limitation, consents obtained in connection with
a purchase of, or tender offer or exchange offer for, Securities). Any past
default or compliance with any provision of this Indenture or the Securities may
be waived with the written consent of the Holders of a majority in principal
amount of the Securities then outstanding (including, without limitation,
consents obtained in connection with a purchase of, or tender offer or exchange
offer for, Securities). However, without the consent of each Holder affected, an
amendment, supplement or waiver may not (with respect to any Securities held by
a non-consenting Holder of Securities):

          (1) reduce the principal amount of Securities outstanding whose
     Holders must consent to an amendment, supplement or waiver;

          (2) reduce the stated rate of or extend the stated time for payment of
     interest or additional interest on any Security;

          (3) reduce the principal of or extend the Stated Maturity of any
     Security;

          (4) reduce the premium payable upon the redemption or repurchase of
     any Security or change the time at which any Security may or shall be
     redeemed or repurchased as described under Section 3.7 or 3.9 or Article V
     or any similar provision, whether through an amendment or waiver of Section
     3.7 or 3.9 or Article V, definitions (with the exception of the defined
     terms "Permitted Holder" and "Change of Control") or otherwise;

          (5) make any Security payable in money other than that stated in the
     Security;

          (6) impair the right of any Holder to institute suit for the
     enforcement of any payment on or with respect to such Holder's Securities;

          (7) make any change to the amendment provisions which require each
     Holder's consent or to the waiver provisions; or

          (8) modify the Subsidiary Guarantees in any manner adverse to the
     Holders.

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          It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, supplement or
waiver, but it shall be sufficient if such consent approves the substance
thereof. A consent to any amendment, supplement or waiver under this Indenture
by any Holder of the Securities given in connection with a tender or exchange of
such Holder's Securities will not be rendered invalid by such tender or
exchange.

          After an amendment or supplement under this Section becomes effective,
the Issuers shall mail to Securityholders a notice briefly describing such
amendment or supplement. The failure to give such notice to all Securityholders,
or any defect therein, shall not impair or affect the validity of an amendment
or supplement under this Section.

          SECTION 9.3. Compliance with Trust Indenture Act. Every amendment or
supplement to this Indenture or the Securities shall comply with the TIA as then
in effect.

          SECTION 9.4. Revocation and Effect of Consents and Waivers. A consent
to an amendment, supplement or a waiver by a Holder of a Security shall bind the
Holder and every subsequent Holder of that Security or portion of the Security
that evidences the same debt as the consenting Holder's Security, even if
notation of the consent or waiver is not made on the Security. Any such Holder
or subsequent Holder may revoke the consent or waiver as to such Holder's
Security or portion of the Security if the Trustee receives the notice of
revocation before the date the amendment, supplement or waiver becomes effective
or otherwise in accordance with any related solicitation documents. After an
amendment, supplement or waiver becomes effective, it shall bind every
Securityholder unless it makes a change described in any of clauses (1) through
(8) of Section 9.2, in which case the amendment, supplement, waiver or other
action shall bind each Securityholder who has consented to it and every
subsequent Securityholder that evidences the same debt as the consenting
Holder's Securities. An amendment, supplement or waiver shall become effective
upon receipt by the Trustee of the requisite number of written consents under
Section 9.1 or Section 9.2 as applicable.

          The Issuers may, but shall not be obligated to, fix a record date for
the purpose of determining the Securityholders entitled to give their consent or
take any other action described above or required or permitted to be taken
pursuant to this Indenture. If a record date is fixed, then notwithstanding the
immediately preceding paragraph, those Persons who were Securityholders at such
record date (or their duly designated proxies), and only those Persons, shall be
entitled to give such consent or to revoke any consent previously given or to
take any such action, whether or not such Persons continue to be Holders after
such record date. No such consent shall become valid or effective more than 120
days after such record date.

          SECTION 9.5. Notation on or Exchange of Securities. If an amendment,
supplement or waiver changes the terms of a Security, the Trustee may require
the Holder of the Security to deliver it to the Trustee. The Trustee may place
an appropriate notation on the Security regarding the changed terms and return
it to the Holder. Alternatively, if the Issuers or the Trustee so determine, the
Issuers in exchange for the Security shall issue and the Trustee shall
authenticate a new Security that reflects the changed terms. Failure to make the
appropriate notation or to issue a new Security shall not affect the validity of
such amendment.

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          SECTION 9.6. Trustee To Sign Amendments. The Trustee shall sign any
amendment, supplement or waiver authorized pursuant to this Article IX if the
amendment, supplement or waiver does not adversely affect the rights, duties,
liabilities or immunities of the Trustee. If, in the reasonable judgment of the
Trustee, it does, the Trustee may but need not sign it. In signing such
amendment, supplement or waiver the Trustee shall be entitled to receive
indemnity reasonably satisfactory to it and to be provided with, and (subject to
Sections 7.1 and 7.2) shall be fully protected in relying upon an Officers'
Certificate and an Opinion of Counsel stating that such amendment, supplement or
waiver is authorized or permitted by this Indenture and that such amendment,
supplement or waiver is the legal, valid and binding obligation of the Issuers
and any Subsidiary Guarantors, enforceable against them in accordance with its
terms, subject to customary exceptions, and complies with the provisions hereof
(including Section 9.3).

                                    ARTICLE X

                              SECURITIES GUARANTEE

          SECTION 10.1. Subsidiary Guarantee. Subject to the provisions of this
Article X, each Subsidiary Guarantor hereby fully, unconditionally and
irrevocably guarantees, as primary obligor and not merely as surety, jointly and
severally with each other Subsidiary Guarantor, to each Holder of the Securities
and the Trustee, the full and punctual payment when due, whether at maturity, by
acceleration, by redemption or otherwise, of the principal of, premium, if any,
and interest on the Securities and, if lawful, all other obligations and
liabilities of the Issuers to the Holders or the Trustee hereunder under this
Indenture (including without limitation interest accruing after the filing of
any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to the Issuers or any Subsidiary
Guarantor whether or not a claim for post-filing or post-petition interest is
allowed in such proceeding and the obligations under Section 7.7) (all the
foregoing being hereinafter collectively called the "Guarantor Obligations").
Each Subsidiary Guarantor agrees that the Guarantor Obligations will rank
equally in right of payment with other Indebtedness of such Subsidiary
Guarantor, except to the extent such other Indebtedness is subordinate to the
Guarantor Obligations. Each Subsidiary Guarantor further agrees (to the extent
permitted by law) that the Guarantor Obligations may be extended or renewed, in
whole or in part, without notice or further assent from it, and that it will
remain bound under this Article X notwithstanding any extension or renewal of
any Guarantor Obligation.

          Each Subsidiary Guarantor waives presentation to, demand of payment
from and protest to the Issuers of any of the Guarantor Obligations and also
waives notice of protest for nonpayment. Each Subsidiary Guarantor waives notice
of any default under the Securities or the Guarantor Obligations.

          Each Subsidiary Guarantor further agrees that its Subsidiary Guarantee
herein constitutes a Guarantee of payment when due (and not a Guarantee of
collection) and waives any right to require that any resort be had by any Holder
to any security held for payment of the Guarantor Obligations.

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          Except as set forth in Section 10.2, the obligations of each
Subsidiary Guarantor hereunder shall not be subject to any reduction,
limitation, impairment or termination for any reason (other than payment of the
Guarantor Obligations in full), including any claim of waiver, release,
surrender, alteration or compromise, and shall not be subject to any defense of
setoff, counterclaim, recoupment or termination whatsoever or by reason of the
invalidity, illegality or unenforceability of the Guarantor Obligations or
otherwise. Without limiting the generality of the foregoing, the obligations of
each Subsidiary Guarantor herein shall not be discharged or impaired or
otherwise affected by (a) the failure of any Holder to assert any claim or
demand or to enforce any right or remedy against the Issuers or any other person
under this Indenture, the Securities or any other agreement or otherwise; (b)
any extension or renewal of any thereof; (c) any rescission, waiver, amendment
or modification of any of the terms or provisions of this Indenture, the
Securities or any other agreement; (d) the release of any security held by any
Holder or the Trustee for the Guarantor Obligations or any of them; (e) the
failure of any Holder to exercise any right or remedy against any other
Subsidiary Guarantor; (f) any change in the ownership of the Issuers; (g) any
default, failure or delay, willful or otherwise, in the performance of the
Guarantor Obligations; or (h) any other act or thing or omission or delay to do
any other act or thing which may or might in any manner or to any extent vary
the risk of any Subsidiary Guarantor or would otherwise operate as a discharge
of such Subsidiary Guarantor as a matter of law or equity.

          Subject to the provisions of Section 3.11, each Subsidiary Guarantor
agrees that its Subsidiary Guarantee herein shall remain in full force and
effect until payment in full of all the Guarantor Obligations or such Subsidiary
Guarantor is released from its Subsidiary Guarantee upon the merger or the sale
of all the Capital Stock or assets of the Subsidiary Guarantor in compliance
with Section 10.2. Each Subsidiary Guarantor further agrees that its Subsidiary
Guarantee herein shall continue to be effective or be reinstated, as the case
may be, if at any time payment, or any part thereof, of principal of or interest
on any of the Guarantor Obligations is rescinded or must otherwise be restored
by any Holder upon the bankruptcy or reorganization of the Issuers or otherwise.

          In furtherance of the foregoing and not in limitation of any other
right which any Holder has at law or in equity against any Subsidiary Guarantor
by virtue hereof, upon the failure of the Issuers to pay any of the Guarantor
Obligations when and as the same shall become due, whether at maturity, by
acceleration, by redemption or otherwise, each Subsidiary Guarantor hereby
promises to and will, upon receipt of written demand by the Trustee, forthwith
pay, or cause to be paid, in cash, to the Holders an amount equal to the sum of
(i) the unpaid amount of such Guarantor Obligations then due and owing and (ii)
accrued and unpaid interest on such Guarantor Obligations then due and owing
(but only to the extent not prohibited by law).

          Each Subsidiary Guarantor further agrees that, as between such
Subsidiary Guarantor, on the one hand, and the Holders, on the other hand, (x)
the maturity of the Guarantor Obligations guaranteed hereby may be accelerated
as provided in this Indenture for the purposes of its Subsidiary Guarantee
herein, notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the Guarantor Obligations guaranteed hereby and
(y) in the event of any such declaration of acceleration of such Guarantor
Obligations, such Guarantor Obligations (whether or not due and payable) shall
forthwith become due and payable by the Subsidiary Guarantor for the purposes of
this Subsidiary Guarantee.

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          Each Subsidiary Guarantor also agrees to pay any and all costs and
expenses (including reasonable attorneys' fees and expenses) incurred by the
Trustee or the Holders in enforcing any rights under this Section.

          SECTION 10.2. Limitation on Liability; Termination, Release and
Discharge.

          (a) Any term or provision of this Indenture to the contrary
notwithstanding, the obligations of each Subsidiary Guarantor hereunder will be
limited to the maximum amount as will, after giving effect to all other
contingent and fixed liabilities of such Subsidiary Guarantor (including,
without limitation, any guarantees under the senior credit facility) and after
giving effect to any collections from or payments made by or on behalf of any
other Subsidiary Guarantor in respect of the obligations of such other
Subsidiary Guarantor under its Subsidiary Guarantee or pursuant to its
contribution obligations under this Indenture, result in the obligations of such
Subsidiary Guarantor under its Subsidiary Guarantee not constituting a
fraudulent conveyance or fraudulent transfer under federal or state law and not
otherwise being void or voidable under any similar laws affecting the rights of
creditors generally.

          (b) In addition, the Company shall not permit any Subsidiary Guarantor
to consolidate with or merge with or into any person (other than another
Subsidiary Guarantor) and shall not permit the conveyance, transfer or lease of
substantially all of the assets of any Subsidiary Guarantor unless:

          (1)  (x) the resulting, surviving or transferee Person shall be a
               corporation, partnership, trust or limited liability company
               organized and existing under the laws of the United States of
               America, any State of the United States or the District of
               Columbia and such Person (if not such Subsidiary Guarantor) shall
               expressly assume, by supplemental indenture, executed and
               delivered to the Trustee, all the obligations of such Subsidiary
               Guarantor under its Subsidiary Guarantee; (y) immediately after
               giving effect to such transaction (and treating any Indebtedness
               that becomes an obligation of the resulting, surviving or
               transferee Person or any Restricted Subsidiary as a result of
               such transaction as having been Incurred by such Person or such
               Restricted Subsidiary at the time of such transaction), no
               Default or Event of Default shall have occurred and be
               continuing; and (z) the Issuers shall have delivered to the
               Trustee an Officers' Certificate and an Opinion of Counsel, each
               stating that such consolidation, merger or transfer and such
               supplemental indenture (if any) comply with this Indenture; or

          (2)  the transaction is made in compliance with Sections 3.7, 3.9 and
4.1.

          Upon the sale or disposition of a Subsidiary Guarantor (by merger,
consolidation, the sale of its Capital Stock or the sale of all or substantially
all of its assets (other than by lease)) and whether or not the Subsidiary
Guarantor is the surviving corporation in such transaction to a Person which is
not the Issuers or a Restricted Subsidiary, such Subsidiary Guarantor will be
automatically released from all its obligations under this Indenture and its
Subsidiary Guarantee and the Registration Rights Agreement and such Subsidiary
Guarantee will terminate; provided,

                                       105

<PAGE>

however, that (x) the sale or other disposition is in compliance with this
Indenture, including Sections 3.7, 3.9 and 4.1 and (y) all the obligations of
such Subsidiary Guarantor under all Credit Facilities and related documentation
and any other obligations of such Subsidiary Guarantor relating to any other
Indebtedness of the Issuers or its Restricted Subsidiaries terminate upon
consummation of such transaction.

          (c) Each Subsidiary Guarantor shall be deemed released from all its
obligations under this Indenture and the Registration Rights Agreement and such
Subsidiary Guarantee shall terminate upon the legal defeasance of the Securities
pursuant to the provisions of Article VIII hereof.

          (d) Each Subsidiary Guarantor shall be released from its obligations
under this Indenture, its Subsidiary Guarantee and the Registration Rights
Agreement if the Issuers designate such Subsidiary Guarantor as an Unrestricted
Subsidiary and such designation complies with the other applicable provisions of
this Indenture.

          SECTION 10.3. Right of Contribution. Each Subsidiary Guarantor hereby
agrees that to the extent that any Subsidiary Guarantor shall have paid more
than its proportionate share of any payment made on the obligations under the
Subsidiary Guarantees, such Subsidiary Guarantor shall be entitled to seek and
receive contribution from and against the Issuers, or any other Subsidiary
Guarantor who has not paid its proportionate share of such payment. The
provisions of this Section 10.3 shall in no respect limit the obligations and
liabilities of each Subsidiary Guarantor to the Trustee and the Holders and each
Subsidiary Guarantor shall remain liable to the Trustee and the Holders for the
full amount guaranteed by such Subsidiary Guarantor hereunder.

          SECTION 10.4. No Subrogation. Notwithstanding any payment or payments
made by each Subsidiary Guarantor hereunder, no Subsidiary Guarantor shall be
entitled to be subrogated to any of the rights of the Trustee or any Holder
against the Issuers or any other Subsidiary Guarantor or any collateral security
or guarantee or right of offset held by the Trustee or any Holder for the
payment of the Guarantor Obligations, nor shall any Subsidiary Guarantor seek or
be entitled to seek any contribution or reimbursement from the Issuers or any
other Subsidiary Guarantor in respect of payments made by such Subsidiary
Guarantor hereunder, until all amounts owing to the Trustee and the Holders by
the Issuers on account of the Guarantor Obligations are paid in full. If any
amount shall be paid to any Subsidiary Guarantor on account of such subrogation
rights at any time when all of the Guarantor Obligations shall not have been
paid in full, such amount shall be held by such Subsidiary Guarantor in trust
for the Trustee and the Holders, segregated from other funds of such Subsidiary
Guarantor, and shall, forthwith upon receipt by such Subsidiary Guarantor, be
turned over to the Trustee in the exact form received by such Subsidiary
Guarantor (duly indorsed by such Subsidiary Guarantor to the Trustee, if
required), to be applied against the Guarantor Obligations.

                                       106

<PAGE>

                                   ARTICLE XI

                                  MISCELLANEOUS

          SECTION 11.1. Trust Indenture Act Controls. If and to the extent that
any provision of this Indenture limits, qualifies or conflicts with another
provision which is required to be included in this Indenture by the TIA, the
provision required by the TIA shall control. Each Subsidiary Guarantor in
addition to performing its obligations under its Subsidiary Guarantee shall
perform such other obligations as may be imposed upon it with respect to this
Indenture under the TIA.

          SECTION 11.2. Notices. Any notice or communication shall be in writing
and delivered in person, sent by facsimile, delivered by commercial courier
service or mailed by first-class mail, postage prepaid, addressed as follows:

               if to the Issuers:

               Stewart & Stevenson LLC
               1000 Louisiana Street
               Suite 5900
               Houston, TX 77002

               Attention: John B. Simmons

               with copies to:

               Jones Day
               222 East 41st Street
               New York, NY 10017

               Attention: William F. Henze, II, Esq.
                          J. Eric Maki, Esq.

               if to the Trustee:

               Wells Fargo Bank, National Association
               Sixth and Marquette
               MAC N9303-120
               Minneapolis, Minnesota 55479

               Attention: Corporate Trust Administration

          The Issuers or the Trustee by written notice to the other may
designate additional or different addresses for subsequent notices or
communications.

          Any notice or communication to the Issuers or the Subsidiary
Guarantors shall be deemed to have been given or made as of the date so
delivered if personally delivered; when answered back, if telexed; when receipt
is acknowledged, if telecopied; and five calendar days

                                       107

<PAGE>

after mailing if sent by registered or certified mail, postage prepaid (except
that a notice of change of address shall not be deemed to have been given until
actually received by the addressee).

          Any notice or communication mailed to a registered Securityholder
shall be mailed to the Securityholder at the Securityholder's address as it
appears on the registration books of the Registrar and shall be sufficiently
given if so mailed within the time prescribed.

          Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it, except that
notices to the Trustee shall be effective only upon receipt.

          SECTION 11.3. Communication by Holders with other Holders.
Securityholders may communicate pursuant to TIA Section 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. Each of the Issuers, the Trustee, the Registrar and anyone else
shall have the protection of TIA Section 312(c).

          SECTION 11.4. Certificate and Opinion as to Conditions Precedent.
Other than in connection with the issuance of the Initial Securities, upon any
request or application by the Issuers to the Trustee to take or refrain from
taking any action under this Indenture, the Issuers shall furnish to the
Trustee:

          (1) an Officers' Certificate in form and substance reasonably
     satisfactory to the Trustee stating that, in the opinion of the signers,
     all conditions precedent, if any, provided for in this Indenture relating
     to the proposed action have been complied with; and

          (2) an Opinion of Counsel in form and substance reasonably
     satisfactory to the Trustee stating that, in the opinion of such counsel,
     all such conditions precedent, if any, provided for in this Indenture
     relating to the proposed action have been complied with.

          SECTION 11.5. Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a covenant or condition
provided for in this Indenture shall include:

          (1) a statement that the individual making such certificate or opinion
     has read such covenant or condition;

          (2) a brief statement as to the nature and scope of the examination or
     investigation upon which the statements or opinions contained in such
     certificate or opinion are based;

          (3) a statement that, in the opinion of such individual, he has made
     such examination or investigation as is necessary to enable him to express
     an informed opinion as to whether or not such covenant or condition has
     been complied with; and

                                       108

<PAGE>

          (4) a statement as to whether or not, in the opinion of such
     individual, such covenant or condition has been complied with.

          In giving such Opinion of Counsel, counsel may rely as to factual
matters on an Officers' Certificate or on certificates of public officials.

          SECTION 11.6. When Securities Disregarded. In determining whether the
Holders of the required aggregate principal amount of Securities have concurred
in any direction, waiver or consent, Securities owned by the Issuers, any
Subsidiary Guarantor or any Affiliate of them shall be disregarded and deemed
not to be outstanding, except that, for the purpose of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Securities which the Trustee actually knows are so owned shall be so
disregarded. Also, subject to the foregoing, only Securities outstanding at the
time shall be considered in any such determination.

          SECTION 11.7. Rules by Trustee, Paying Agent and Registrar. The
Trustee may make reasonable rules for action by, or at meetings of,
Securityholders. The Registrar and the Paying Agent may make reasonable rules
for their functions.

          SECTION 11.8. Legal Holidays. A "Legal Holiday" is a Saturday, a
Sunday or other day on which commercial banking institutions are authorized or
required to be closed in New York, New York. If a payment date is a Legal
Holiday, payment shall be made on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening period. If a regular
record date is a Legal Holiday, the record date shall not be affected.

          SECTION 11.9. GOVERNING LAW. THIS INDENTURE AND THE SECURITIES SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS INDENTURE, THE SECURITIES OR THE SUBSIDIARY GUARANTEES.

          SECTION 11.10. No Recourse Against Others. No director, officer,
employee, incorporator or stockholder, as such, of the Issuers or any Subsidiary
Guarantor shall have any liability for any obligations of the Issuers or such
Subsidiary Guarantor under the Securities, this Indenture or a Subsidiary
Guarantee or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of Securities by accepting a Security
waives and releases all such liability to the extent permitted by applicable
law. The waiver and release are part of the consideration for issuance of the
Securities. Such waiver may not be effective to waive liabilities under the
federal securities laws and it is the view of the SEC that such a waiver is
against public policy.

          SECTION 11.11. Successors. All agreements of the Issuers and each
Subsidiary Guarantor in this Indenture and the Securities shall bind their
respective successors. All agreements of the Trustee in this Indenture shall
bind its successors.

                                       109

<PAGE>

          SECTION 11.12. Multiple Originals. The parties may sign any number of
copies of this Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement. One signed copy is enough to prove this
Indenture.

          SECTION 11.13. Qualification of Indenture. The Issuers shall qualify
this Indenture under the TIA in accordance with the terms and conditions of the
Registration Rights Agreement and shall pay all reasonable costs and expenses
(including attorneys' fees and expenses for the Issuers, the Trustee and the
Holders) incurred in connection therewith, including, but not limited to, costs
and expenses of qualification of this Indenture and the Securities and printing
this Indenture and the Securities. The Trustee shall be entitled to receive from
the Issuers any such Officers' Certificates, Opinions of Counsel or other
documentation as it may reasonably request in connection with any such
qualification of this Indenture under the TIA.

          SECTION 11.14. Table of Contents; Headings. The table of contents,
cross-reference sheet and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not intended
to be considered a part hereof and shall not modify or restrict any of the terms
or provisions hereof.

                                       110

<PAGE>

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

                                        STEWART & STEVENSON LLC

                                        By:    /s/ Hushang Ansary
                                               ---------------------------------
                                        Name:  Hushang Ansary
                                        Title: Chairman of the Board of Director

                                        STEWART & STEVENSON CORP.

                                        By:    /s/ Hushang Ansary
                                               ---------------------------------
                                        Name:  Hushang Ansary
                                        Title: Chairman of the Board of Director

                                        STEWART & STEVENSON DISTRIBUTOR
                                        HOLDINGS LLC
                                        STEWART & STEVENSON POWER PRODUCTS LLC
                                        STEWART & STEVENSON PETROLEUM
                                        SERVICES LLC
                                        S&S AGENT LLC

                                        By: STEWART & STEVENSON LLC, as the
                                            sole member of each of
                                            the Guarantors

                                        By:    /s/ Hushang Ansary
                                               ---------------------------------
                                        Name:  Hushang Ansary
                                        Title: Chairman of the Board of Director

<PAGE>

                                        WELLS FARGO BANK, NATIONAL ASSOCIATION,
                                        as Trustee

                                        By     /s/ Jane Schweiger
                                               ---------------------------------
                                        Name:  Jane Y. Schweiger
                                        Title: Vice President

<PAGE>

                                                                       EXHIBIT A

                             [FORM OF FACE OF NOTE]

                    [Applicable Restricted Securities Legend]
                       [Depository Legend, if applicable]

No. [___]                           Principal Amount $[___________], as
                                    revised by the Schedule of Increases and
                                    Decreases in Global Security attached hereto
                                    CUSIP NO. __________________________________
                                    ISIN: ______________________________________

                             STEWART & STEVENSON LLC
                            STEWART & STEVENSON CORP.

                            10% Senior Notes due 2014

          Stewart & Stevenson LLC, a Delaware limited liability corporation, and
Stewart & Stevenson Corp., a Delaware corporation, promise to pay to Cede & Co.,
or its registered assigns, the principal sum of _____________, as revised by the
Schedule of Increases and Decreases in Global Security attached hereto, on July
15, 2014.

          Interest Payment Dates: January 15 and July 15, commencing on January
15, 2007

          Record Dates: January 1 and July 1

                                       A-1

<PAGE>

          Additional provisions of this Security are set forth on the other side
of this Security.

                                        STEWART & STEVENSON LLC

                                        By:
                                            ------------------------------------
                                        Name:
                                              ----------------------------------
                                        Title:
                                               ---------------------------------

                                        STEWART & STEVENSON CORP.

                                        By:
                                            ------------------------------------
                                        Name:
                                              ----------------------------------
                                        Title:
                                               ---------------------------------

TRUSTEE'S CERTIFICATE OF
AUTHENTICATION

WELLS FARGO BANK, NATIONAL
ASSOCIATION
as Trustee, certifies
that this is one of
the Securities referred
to in the Indenture.

By:
    ---------------------------------
    Authorized Signatory                Date:            , 20
                                              -------- --    --

                                       A-2

<PAGE>

                         [FORM OF REVERSE SIDE OF NOTE]

                             STEWART & STEVENSON LLC
                            STEWART & STEVENSON CORP.

                            10% Senior Notes due 2014

This Security is one of a duly authorized issue of Securities of the Issuers,
issued under an Indenture dated as of July 6, 2006, among the Issuers, the
Subsidiary Guarantors named therein and Wells Fargo Bank, National Association,
as Trustee (as it may be amended or supplemented from time to time in accordance
with the terms thereof, the "Indenture"), to which Indenture reference is hereby
made for a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Issuers, the Subsidiary Guarantors, the Trustee and
the Holders and the terms upon which the Securities are, and are to be,
authenticated and delivered.

All terms used in this Security that are defined in the Indenture shall have the
meaning assigned to them in the Indenture.

1. Interest

          Stewart & Stevenson LLC (the "Company"), a Delaware limited liability
corporation and Stewart & Stevenson Corp., a Delaware corporation (such
companies, and their successors and assigns under the Indenture hereinafter
referred to, being herein called the "Issuers"), promise to pay interest on the
principal amount of this Security at the rate per annum shown above.

          The Company will pay interest semi-annually on January 15 and July 15,
commencing on January 15, 2007. Interest on the Securities will accrue from the
most recent date to which interest has been paid on the Securities or, if no
interest has been paid, from July 6, 2006. The Company shall pay interest on
overdue principal and on overdue premium, if any (plus interest on such interest
to the extent lawful), at the rate borne by the Securities to the extent lawful.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.

          [If an exchange offer (the "Exchange Offer") registered under the
Securities Act is not consummated or a shelf registration statement (the "Shelf
Registration Statement") under the Securities Act with respect to resales of the
Securities is not declared effective by the SEC on or before the date that is
270 days after the Issue Date (the "Target Registration Date") in accordance
with the terms of the Registration Rights Agreement dated July 6, 2006 among the
Issuers, the Subsidiary Guarantors and the Initial Purchaser, the annual
interest rate borne by the Securities shall be increased from the rate shown
above by (i) 0.25% per annum for the first 90-day period immediately following
the Target Registration Date and (ii) an additional 0.25% per annum with respect
to each subsequent 90-day period, in each case until the Exchange Offer is
completed or the Shelf Registration Statement, if required, is declared
effective by the SEC or the Securities become freely tradable under the
Securities Act, up to a maximum of 1.00% per

                                       A-3

<PAGE>

annum of additional interest. If the Issuers receive a request (a "Shelf
Request") from an Initial Purchaser representing that it holds Securities that
are or were ineligible to be exchanged in the Exchange Offer and requesting that
a Shelf Registration Statement be filed due to an unsold allotment of Securities
held by such Initial Purchaser, and the Shelf Registration Statement is not
declared effective by the SEC by the later of (x) 150 days after the Issue Date
and (y) 90 days after the delivery of such Shelf Request (the "Shelf Additional
Interest Date"), the annual interest rate borne by such Securities held by the
Initial Purchaser shall be increased from the rate shown above by (i) 0.25% per
annum for the first 90-day period immediately following the Shelf Additional
Interest Date and (ii) an additional 0.25% per annum with respect to each
subsequent 90-day period, in each case until the Shelf Registration Statement is
declared effective or the Securities become freely tradable under the Securities
Act, up to a maximum of 1.00% per annum of additional interest. The Holder of
this Security is entitled to the benefits of such Registration Rights
Agreement.]

2. Method of Payment

          By no later than 10:00 a.m. (New York City time) on the date on which
any principal of, premium, if any, or interest on any Security is due and
payable, the Company shall deposit with the Paying Agent a sum sufficient in
immediately available funds to pay such principal, premium, if any, or interest.
The Issuers will pay interest (except Defaulted Interest) to the Persons who are
registered Holders of Securities at the close of business on the January 1 or
July 1 next preceding the interest payment date even if Securities are
cancelled, repurchased or redeemed after the record date and on or before the
interest payment date. Holders must surrender Securities to a Paying Agent to
collect principal payments. The Company will pay principal, premium, if any, and
interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. Payments in respect of
Securities represented by a Global Security (including principal, premium, if
any, and interest) will be made by the transfer of immediately available funds
to the accounts specified by The Depository Trust Company or any successor
depository. The Company will make all payments in respect of a Definitive
Security (including principal, premium, if any, and interest) by mailing a check
to the registered address of each Holder thereof; provided, however, that
payments on the Securities may also be made, in the case of a Holder of at least
$1,000,000 aggregate principal amount of Securities, by wire transfer to a U.S.
dollar account maintained by the payee with a bank in the United States if such
Holder elects payment by wire transfer by giving written notice to the Trustee
or the Paying Agent to such effect designating such account no later than 15
days immediately preceding the relevant due date for payment (or such other date
as the Trustee may accept in its discretion).

3. Paying Agent and Registrar

          Initially, Wells Fargo Bank, National Association (the "Trustee") will
act as Trustee, Paying Agent and Registrar. The Issuers may appoint and change
any Paying Agent, Registrar or co-registrar without notice to any
Securityholder. Any of the domestically organized Wholly-Owned Subsidiaries may
act as Paying Agent, Registrar or co-registrar.

                                       A-4

<PAGE>

4. Indenture

          The Issuers issued the Securities under the Indenture. The terms of
the Securities include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as in effect on the date of the Indenture (the "Act"). The
Securities are subject to all terms and provisions of the Indenture, and
Securityholders are referred to the Indenture and the Act for a statement of
those terms.

          [The Securities are general unsecured, senior obligations of the
Issuers. The aggregate principal amount of Securities that may be authenticated
and delivered under the Indenture is unlimited. This Security is one of the 10%
Senior Notes due 2014 referred to in the Indenture. The Securities include (i)
$150,000,000 aggregate principal amount of the Issuers' 10% Senior Notes due
2014 issued under the Indenture on July 6, 2006 (herein called "Initial
Securities"), (ii) if and when issued, additional 10% Senior Notes due 2014 of
the Issuers that may be issued from time to time under the Indenture subsequent
to July 6, 2006 (herein called "Additional Securities") and (iii) if and when
issued, the Issuers' 10% Senior Notes due 2014 that may be issued from time to
time under the Indenture in exchange for Initial Securities or Additional
Securities in an offer registered under the Securities Act as provided in the
Registration Rights Agreement (herein called "Exchange Securities"). The Initial
Securities, Additional Securities and Exchange Securities are treated as a
single class of securities under the Indenture. The Indenture imposes certain
limitations on the incurrence of indebtedness, the making of restricted
payments, the sale of assets and subsidiary stock, the incurrence of certain
liens, sale/leaseback transactions, affiliate transactions, the making of
payments for consents, the entering into of agreements that restrict
distributions from restricted subsidiaries and the consummation of mergers and
consolidations. The Indenture also imposes requirements with respect to the
provision of financial information and the provision of guarantees of the
Securities by certain subsidiaries.]

          To guarantee the due and punctual payment of the principal, premium,
if any, and interest (including post-filing or post-petition interest) on the
Securities and all other amounts payable by the Issuers under the Indenture and
the Securities when and as the same shall be due and payable, whether at
maturity, by acceleration or otherwise, according to the terms of the Securities
and the Indenture, the Subsidiary Guarantors have fully, unconditionally and
irrevocably Guaranteed (and future guarantors, together with the Subsidiary
Guarantors, will fully, unconditionally and irrevocably Guarantee), jointly and
severally, to each Holder of the Securities and the Trustee the Guarantor
Obligations pursuant to Article X of the Indenture on a senior basis.

5. Redemption

          Except as set forth below, the Securities will not be redeemable at
the option of the Issuers prior to July 15, 2010. On and after such date, the
Securities will be redeemable, at the Issuers' option, in whole or in part, at
any time upon not less than 30 nor more than 60 days' prior notice mailed to
each Holder's registered address, at the following redemption prices (expressed
in percentages of principal amount), plus accrued and unpaid interest, if any,
to the applicable Redemption Date (subject to the right of Holders of record on
the relevant record date

                                       A-5

<PAGE>

to receive interest due on the relevant interest payment date), if redeemed
during the 12-month period commencing on July 15 of the years set forth below:

<TABLE>
<CAPTION>
PERIOD                PERCENTAGE
------                ----------
<S>                   <C>
2010                   105.000%
2011                   102.500%
2012 and thereafter    100.000%
</TABLE>

          In addition, at any time and from time to time prior to July 15, 2009,
the Issuers may on any one or more occasions redeem in the aggregate up to 35%
of the original principal amount of the Securities (after giving effect to any
future issuance of Additional Securities) with the Net Cash Proceeds of one or
more Equity Offerings at a redemption price (expressed as a percentage of
principal amount) of 110%, plus accrued and unpaid interest, if any, to the
Redemption Date (subject to the right of Holders of record on the relevant
record date to receive interest due on the relevant interest payment date);
provided, however, that at least 65% of the original principal amount of the
Securities (after giving effect to any future issuance of Additional Securities)
must remain outstanding after each such redemption; provided further, that each
such redemption occurs within 90 days of the date of closing of such Equity
Offering.

          Notwithstanding the preceding paragraphs, the Securities will be
redeemable, at the Issuers' option, at any time prior to July 15, 2010, in whole
or from time to time in part, at a price equal to the greater of:

          (1)  100% of the principal amount of the Securities to be redeemed
               plus accrued but unpaid interest to the date of redemption; and

          (2)  (a) the sum of the present values of the remaining scheduled
               payments of principal and interest thereon from the date of
               redemption to July 15, 2010 (except for currently accrued but
               unpaid interest) (assuming the Securities are redeemed, and based
               on the applicable redemption price, on that date) discounted to
               the date of redemption, on a semiannual basis (assuming a 360-day
               year consisting of twelve 30-day months), at the Treasury Rate,
               plus 50 basis points, plus (b) accrued but unpaid interest to the
               date of redemption.

          The actual redemption price, calculated as provided in this Section,
will be calculated and certified to the Trustee and the Issuers by the
Independent Investment Banker. For purposes of determining the optional
redemption price pursuant to this Section, the following definitions are
applicable:

          "Comparable Treasury Issue" means the United States Treasury security
     or securities selected by the Independent Investment Banker as having an
     actual or interpolated maturity comparable to the remaining term of the
     Securities to July 15, 2010 that would be utilized, at the time of
     selection and in accordance with customary financial practice, in pricing
     new issues of corporate debt securities of a comparable maturity.

                                       A-6

<PAGE>

          "Comparable Treasury Price" means, for any Redemption Date, (1) the
     average of four Reference Treasury Dealer Quotations for such Redemption
     Date, after excluding the highest and lowest such Reference Treasury Dealer
     Quotations, or (2) if the Independent Investment Banker obtains fewer than
     four such Reference Treasury Dealer Quotations, the average of all such
     quotations.

          "Independent Investment Banker" means J.P. Morgan Securities Inc. and
     any successor firm, or if such firm is unwilling or unable to select the
     Comparable Treasury Issue, an independent investment banking institution of
     national standing appointed by the Trustee after consultation with the
     Issuers.

          "Reference Treasury Dealer" means J.P. Morgan Securities Inc. and its
     successors, plus three other dealers selected by the Independent Investment
     Banker that are primary U.S. government securities dealers in New York
     City; provided, if J.P. Morgan Securities Inc. or any primary U.S.
     government securities dealer selected by the Independent Investment Banker
     shall cease to be a primary U.S. government securities dealer, then such
     other primary U.S. government securities dealers as may be substituted by
     the Independent Investment Banker.

          "Reference Treasury Dealer Quotations" means, for each Reference
     Treasury Dealer and any Redemption Date, the average, as determined by the
     Trustee, of the bid and asked prices for the Comparable Treasury Issue
     (expressed in each case as a percentage of its principal amount) at 3:30
     p.m., New York City time, on the third business day preceding such
     Redemption Date, as quoted in writing to the Trustee by such Reference
     Treasury Dealer.

          "Treasury Rate" means, with respect to any Redemption Date, (1) the
     yield, under the heading which represents the average for the immediately
     preceding week, appearing in the most recently published statistical
     release designated "H.15(519)" or any successor publication which is
     published weekly by the Board of Governors of the Federal Reserve System
     and which establishes yields on actively traded United States Treasury
     securities adjusted to constant maturity under the caption "Treasury
     Constant Maturities," for the maturity corresponding to the Comparable
     Treasury Issue (if no maturity is within three months before or after the
     remaining term of the Securities, yields for the two published maturities
     most closely corresponding to the Comparable Treasury Issue shall be
     determined and the Treasury Rate shall be interpolated or extrapolated from
     such yields on a straight line basis, rounding to the nearest month) or (2)
     if such release (or any successor release) is not published during the week
     in which the calculation date falls (or in the immediately preceding week
     if the calculation date falls on any day prior to the usual publication
     date for such release) or does not contain such yields, the rate per year
     equal to the semi-annual equivalent yield to maturity of the Comparable
     Treasury Issue, calculated using a price for the Comparable Treasury Issue
     (expressed as a percentage of its principal amount) equal to the Comparable
     Treasury Price for such Redemption Date. The Treasury Rate shall be
     calculated on the third business day preceding the Redemption Date. Any
     weekly average yields calculated by interpolation or extrapolation will be
     rounded to the nearest 1/100th of 1%, with any figure of 1/200th of 1% or
     above being rounded upward.

                                       A-7

<PAGE>

          If the optional Redemption Date is on or after an interest record date
and on or before the related interest payment date, the accrued and unpaid
interest, if any, will be paid to the Person in whose name the Security is
registered at the close of business on such record date, and no additional
interest will be payable to Holders whose Securities will be subject to
redemption by the Issuers.

          In the case of any partial redemption, selection of the Securities for
redemption will be made by the Trustee in compliance with the requirements of
the principal national securities exchange, if any, on which the Securities are
listed or, if the Securities are not listed, then on a pro rata basis, by lot or
by such other method as the Trustee in its sole discretion shall deem to be fair
and appropriate, although no Securities of $1,000 in original principal amount
or less will be redeemed in part. If any Security is to be redeemed in part
only, the notice of redemption relating to such Security shall state the portion
of the principal amount thereof to be redeemed. A new Security in principal
amount equal to the unredeemed portion thereof will be issued in the name of the
Holder thereof upon cancellation of the original Security. On and after the
Redemption Date, interest will cease to accrue on Securities or portions thereof
called for redemption as long as the Issuers have deposited with the Paying
Agent funds in satisfaction of the applicable redemption price pursuant to the
Indenture.

6. Repurchase Provisions

          If a Change of Control occurs, unless any of the Issuers has exercised
its right to redeem all of the Securities as described under paragraph 5 of this
Security, then such Change of Control shall constitute a triggering event which
shall trigger the obligation of the Issuers to offer to repurchase from each
Holder all or any part (equal to $1,000 or an integral multiple of $1,000 in
excess thereof) of such Holder's Securities at a purchase price in cash equal to
101% of the principal amount thereof, plus accrued and unpaid interest, if any,
to the date of repurchase (subject to the right of Holders of record on the
relevant record date to receive interest due on the relevant interest payment
date) as provided in, and subject to the terms of, the Indenture.

7. Denominations; Transfer; Exchange

          The Securities are in registered form without coupons in denominations
of principal amount of $2,000 and whole multiples of $1,000 in excess thereof. A
Holder may transfer or exchange Securities in accordance with the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements or transfer documents and to pay a sum sufficient to cover any
taxes and fees required by law or permitted by the Indenture. The Issuers and
the Registrar need not register the transfer of or exchange (i) any Securities
selected for redemption (except, in the case of a Security to be redeemed in
part, the portion of the Security not to be redeemed) for a period beginning 15
days before the mailing of a notice of Securities to be redeemed and ending at
the close of business on the date of such mailing or (ii) any Securities for a
period beginning 15 days before an interest payment date and ending on such
interest payment date.

                                       A-8

<PAGE>

8. Persons Deemed Owners

          The registered Holder of this Security may be treated as the owner of
it for all purposes.

9. Unclaimed Money

          If money for the payment of principal or interest remains unclaimed
for two years, the Trustee or Paying Agent shall pay the money back to the
Company at its request unless an abandoned property law designates another
Person. After any such payment, Holders entitled to the money must look only to
the Company for payment as general creditors unless an abandoned property law
designates another person and not to the Trustee for payment.

10. Defeasance

          Subject to certain exceptions and conditions set forth in the
Indenture, the Issuers at any time may terminate some or all of its obligations
under the Securities and the Indenture if the Issuers deposits with the Trustee
money or U.S. Government Obligations for the payment of principal, premium, if
any, and interest on the Securities to redemption or maturity, as the case may
be.

11. Amendment, Supplement, Waiver

          Subject to certain exceptions set forth in the Indenture, (i) the
Indenture and the Securities may be amended or supplemented by the Issuers, the
Subsidiary Guarantors and the Trustee with the written consent of the Holders of
at least a majority in principal amount of the then outstanding Securities and
(ii) any default (other than with respect to nonpayment or in respect of a
provision that cannot be amended without the written consent of each
Securityholder affected) or noncompliance with any provision may be waived with
the written consent of the Holders of a majority in principal amount of the then
outstanding Securities. Subject to certain exceptions set forth in the
Indenture, without the consent of any Securityholder, each of the Issuers, the
Subsidiary Guarantors and the Trustee may amend or supplement the Indenture or
the Securities to cure any ambiguity, omission, defect or inconsistency, to
provide for uncertificated Securities in addition to or in place of certificated
Securities, to comply with Article IV of the Indenture or Section 10.2 in
respect of the assumption by a Successor Company of an obligation of each of the
Issuers or the assumption by a successor Person of the obligations of any
Subsidiary Guarantor under this Indenture, to add Guarantees with respect to the
Securities or release a Subsidiary Guarantor in accordance with the Indenture,
to secure the Securities, to make any change that would provide any additional
rights or benefits to the Holders of the Securities or surrender any right or
power conferred upon each of the Issuers or that does not adversely affect the
rights under the Indenture of any such Holder, to comply with any requirement of
the SEC in order to effect or maintain the qualification of this Indenture under
the TIA, to provide for the issuance of the Exchange Securities, to provide for
the appointment of a successor Trustee or to conform the Indenture, the
Securities or the Subsidiary Guarantees to certain provisions of the
"Description of notes," as contained in the final offering memorandum related to
the Initial Securities, in each case as more fully described in the Indenture.

                                       A-9

<PAGE>

12. Defaults and Remedies

          Under the Indenture, Events of Default include (each of which are more
specially described in the Indenture) (i) default in any payment of interest or
additional interest (as required by the Registration Rights Agreement) on any
Security when due, continued for 30 days; (ii) default in the payment of
principal of or premium, if any, on any Security when due at its Stated
Maturity, upon optional redemption, upon required repurchase, upon declaration
or otherwise; (iii) failure by the Company to comply with its obligations under
Section 4.1 of the Indenture; (iv) failure by the Company to comply for 30 days
after notice with any of its obligations under the covenants described under
Section 3.9 of the Indenture or under certain covenants described in Article III
of the Indenture (in each case, other than a failure to purchase Securities
which constitutes an Event of Default under clause (ii) above); (v) failure by
the Company to comply for 60 days after notice with its other agreements
contained in the Indenture; (vi) default under any mortgage, indenture or
instrument under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Company or any of its
Restricted Subsidiaries (or the payment of which is guaranteed by the Company or
any of its Restricted Subsidiaries), other than Indebtedness owed to the Company
or a Restricted Subsidiary, whether such Indebtedness or guarantee now exists,
or is created after the Issue Date, which default (a) is caused by a failure to
pay principal of, or interest or premium, if any, on such Indebtedness prior to
the expiration of the grace period provided in such Indebtedness ("payment
default"); or (b) results in the acceleration of such Indebtedness prior to its
maturity; and, in each case, the principal amount of any such Indebtedness,
together with the principal amount of any other such Indebtedness under which
there has been a payment default or the maturity of which has been so
accelerated, aggregates $10 million or more; (vii) certain events of bankruptcy,
insolvency or reorganization of the Company or a Significant Subsidiary or group
of Restricted Subsidiaries that, taken together (as of the latest audited
consolidated financial statements for the Company and its Restricted
Subsidiaries), would constitute a Significant Subsidiary; (viii) failure by the
Company or any Significant Subsidiary or group of Restricted Subsidiaries that,
taken together (as of the latest audited consolidated financial statements for
the Company and its Restricted Subsidiaries), would constitute a Significant
Subsidiary to pay final judgments aggregating in excess of $10 million (net of
any amounts that a reputable and creditworthy insurance company has acknowledged
liability for in writing), which judgments are not paid, discharged or stayed
for a period of 60 days; or (ix) any Subsidiary Guarantee of a Significant
Subsidiary ceases to be in full force and effect (except as contemplated by the
terms of the Indenture) or is declared null and void in a judicial proceeding or
any Subsidiary Guarantor denies or disaffirms its obligations under the
Indenture or its Subsidiary Guarantee.

          If an Event of Default (other than an Event of Default described in
(vii) of this Section, above, occurs and is continuing, the Trustee by notice to
the Issuers or the Holders of at least 25% in principal amount of the
outstanding Securities may declare all the Securities to be due and payable
immediately. If an Event of Default described in (vii) hereof occurs and is
continuing, the principal of, premium, if any, and accrued and unpaid interest
on all the Securities will become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Holders.

                                      A-10

<PAGE>

          Holders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives reasonable indemnity or security. Subject to
certain limitations, Holders of a majority in principal amount of the Securities
may direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders notice of any continuing Default or Event of Default
(except a Default or Event of Default in payment of principal or interest) if it
determines that withholding notice is in their interest.

13. Trustee Dealings with the Issuers

          Subject to certain limitations set forth in the Indenture, the Trustee
under the Indenture, in its individual or any other capacity, may become the
owner or pledgee of Securities and may otherwise deal with the Issuers,
Subsidiary Guarantors or their Affiliates and may otherwise deal with each of
the Issuers or its Affiliates with the same rights it would have if it were not
Trustee.

14. No Recourse Against Others

          No director, officer, employee, incorporator or stockholder, as such,
of the Issuers or any Subsidiary Guarantor shall have any liability for any
obligations of each of the Issuers or such Subsidiary Guarantor under the
Securities, including this Security, the Indenture or a Subsidiary Guarantee or
for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder of this Security by accepting this Security waives
and releases all such liability to the extent permitted by applicable law. The
waiver and release are part of the consideration for issuance of this Security.
Such waiver may not be effective to waive liabilities under the federal
securities laws and it is the view of the SEC that such a waiver is against
public policy.

15. Authentication

          This Security shall not be valid until an authorized signatory of the
Trustee (or an Authenticating Agent acting on its behalf) manually signs the
certificate of authentication on the other side of this Security.

16. Abbreviations

          Customary abbreviations may be used in the name of a Securityholder or
an assignee, such as TEN COM (= tenants in common), TEN ENT (= tenants by the
entirety), JT TEN (= joint tenants with rights of survivorship and not as
tenants in common), CUST (= custodian) and U/G/M/A (= Uniform Gift to Minors
Act).

17. CUSIP, Common Code and ISIN Numbers

          The Issuers have caused CUSIP, Common Code or ISIN numbers, if
applicable, to be printed on the Securities, including this Security, and have
directed the Trustee to use CUSIP, Common Code or ISIN numbers, if applicable,
in notices of redemption as a convenience to Securityholders. No representation
is made as to the accuracy of such numbers

                                      A-11

<PAGE>

either as printed on the Securities, including this Security, or as contained in
any notice of redemption and reliance may be placed only on the other
identification numbers placed thereon.

18. Governing Law

          This Security shall be governed by, and construed in accordance with,
the laws of the State of New York.

          The Issuers will furnish to any Securityholder upon written request
and without charge to the Securityholder a copy of the Indenture. Requests may
be made to:

                             Stewart & Stevenson LLC
                              1000 Louisiana Street
                                   Suite 5900
                              Houston, Texas 77002

                           Attention: John B. Simmons

                                      A-12
<PAGE>

                                 ASSIGNMENT FORM

          To assign this Security, fill in the form below:

          I or we assign and transfer this Security to:

________________________________________________________________________________
              (Print or type assignee's name, address and zip code)

________________________________________________________________________________
               (Insert assignee's social security or tax I.D. No.)

     and irrevocably appoint ___________ agent to transfer this Security on the
     books of the Issuers. The agent may substitute another to act for him.

________________________________________________________________________________

Date:                                   Your Signature:
      -------------------------------                   ------------------------

Signature Guarantee:
                     -----------------------------------------------------------
                                    (Signature must be guaranteed)

--------------------------------------------------------------------------------
Sign exactly as your name appears on the other side of this Security.

The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.

     [In connection with any transfer or exchange of any of the Securities
evidenced by this certificate occurring prior to the date that is two years
after the later of the date of original issuance of such Securities and the last
date, if any, on which such Securities were owned by the Issuers, or any
Affiliate of the Issuers, the undersigned confirms that such Securities are
being:

CHECK ONE BOX BELOW:

     1[ ] acquired for the undersigned's own account, without transfer; or

     2[ ] transferred to the Issuers; or

     3[ ] transferred pursuant to and in compliance with Rule 144A under the
          Securities Act of 1933, as amended (the "Securities Act"); or

     4[ ] transferred pursuant to an effective registration statement under the
          Securities Act; or

     5[ ] transferred pursuant to and in compliance with Regulation S under the
          Securities Act; or

                                      A-13

<PAGE>

     6[ ] transferred to an institutional "accredited investor" (within the
          meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act),
          that has furnished to the Trustee a signed letter containing certain
          representations and agreements (the form of which letter appears as
          Section 2.7 of the Indenture); or

     7[ ] transferred pursuant to another available exemption from the
          registration requirements of the Securities Act of 1933, as amended.

Unless one of the boxes is checked, the Trustee will refuse to register any of
the Securities evidenced by this certificate in the name of any person other
than the registered Holder thereof; provided, however, that if box (5), (6) or
(7) is checked, the Trustee or the Issuers may require, prior to registering any
such transfer of the Securities, in its sole discretion, such legal opinions,
certifications and other information as the Trustee or the Issuers may
reasonably request to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933, as amended, such as the exemption
provided by Rule 144 under such Act.

                                        ----------------------------------------
                                        Signature

Signature Guarantee:

Date:
      -------------------------------   ----------------------------------------
                                        Signature of Signature Guarantee

________________________________________________________________________________

The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.

TO BE COMPLETED BY PURCHASER IF (1) OR (3) ABOVE IS CHECKED.

     The undersigned represents and warrants that it is purchasing this Security
for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, as amended, and is aware that the sale to it is being made in reliance on
Rule 144A and acknowledges that it has received such information regarding the
Issuers as the undersigned has requested pursuant to Rule 144A or has determined
not to request such information and that it is aware that the transferor is
relying upon the undersigned's foregoing representations in order to claim the
exemption from registration provided by Rule 144A.

                                        ----------------------------------------
                                        Dated:                                 ]

                                      A-14

<PAGE>

                      [TO BE ATTACHED TO GLOBAL SECURITIES]

             SCHEDULE OF INCREASES AND DECREASES IN GLOBAL SECURITY

     The following increases and decreases in this Global Security have been
made:

<TABLE>
<CAPTION>
                                                               Principal Amount of       Signature of
Date of       Amount of decrease in   Amount of increase in   this Global Security   authorized signatory
Decrease or    Principal Amount of     Principal Amount of       following such          of Trustee or
Increase       this Global Security    this Global Security   decrease or increase   Securities Custodian
-----------   ---------------------   ---------------------   --------------------   --------------------
<S>           <C>                     <C>                     <C>                    <C>

</TABLE>

                                      A-15

<PAGE>

                       OPTION OF HOLDER TO ELECT PURCHASE

          If you elect to have this Security purchased by the Issuers Pursuant
to Section 3.7 or 3.9 of the Indenture, check either box:

                                     [ ] [ ]
                                     3.7 3.9

          If you want to elect to have only part of this Security purchased by
the Issuers pursuant to Section 3.7 or Section 3.9 of the Indenture, state the
amount in principal amount (must be integral multiple of $1,000): $____________

Date:            Your Signature:
      ----------                 -----------------------------------------------
                                 (Sign exactly as your name appears on the other
                                              side of the Security)

Signature Guarantee:
                     -----------------------------------------------------------
                                    (Signature must be guaranteed)

The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
SEC Rule 17Ad-15.

                                      A-16

<PAGE>

                                                                       EXHIBIT B

            FORM OF INDENTURE SUPPLEMENT TO ADD SUBSIDIARY GUARANTORS

          This Supplemental Indenture, dated as of [_______ __], 20__ (this
"Supplemental Indenture" or "Guarantee"), among [name of future Subsidiary
Guarantor] (the "Guarantor"), Steward & Stevenson LLC, a Delaware limited
liability corporation and Stewart & Stevenson Corp., a Delaware corporation
(such companies, and their successors and assigns under the Indenture
hereinafter referred to, being herein called the "Issuers"), each other then
existing Subsidiary Guarantor under the Indenture referred to below, and Wells
Fargo Bank, National Association, as Trustee under the Indenture referred to
below.

                                   WITNESSETH:

          WHEREAS, the Issuers, the Subsidiary Guarantors and the Trustee have
heretofore executed and delivered an Indenture, dated as of July 6, 2006 (as
amended, supplemented, waived or otherwise modified, the "Indenture"), providing
for the issuance of 10% Senior Notes due 2014 of the Issuers (the "Securities");

          WHEREAS, Section 3.11 of the Indenture provides that the Issuers are
required to cause each Restricted Subsidiary that Guarantees any Indebtedness of
the Issuers or any of its Subsidiary Guarantors to execute and deliver to the
Trustee a supplemental indenture pursuant to which such Restricted Subsidiary
will unconditionally Guarantee, on a joint and several basis with the other
Subsidiary Guarantors, the full and prompt payment of the principal of, premium,
if any, and interest on the Securities on a senior basis; and

          WHEREAS, pursuant to Section 9.1 of the Indenture, the Trustee, the
Issuers and the Subsidiary Guarantors are authorized to execute and deliver this
Supplemental Indenture to amend or supplement the Indenture, without the consent
of any Securityholder;

          NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the
Guarantor, the Issuers, the other Subsidiary Guarantors and the Trustee mutually
covenant and agree for the equal and ratable benefit of the Holders of the
Securities as follows:

                                    ARTICLE I

                                   Definitions

          SECTION 1.1 Defined Terms. As used in this Supplemental Indenture,
terms defined in the Indenture or in the preamble or recital hereto are used
herein as therein defined, except that the term "Holders" in this Guarantee
shall refer to the term "Holders" as defined in the Indenture and the Trustee
acting on behalf or for the benefit of such Holders. The words "herein,"
"hereof" and "hereby" and other words of similar import used in this
Supplemental

                                       B-1

<PAGE>

Indenture refer to this Supplemental Indenture as a whole and not to any
particular section hereof.

                                   ARTICLE II

                        Agreement to be Bound; Guarantee

          SECTION 2.1 Agreement to be Bound. The Guarantor hereby becomes a
party to the Indenture as a Subsidiary Guarantor and as such will have all of
the rights and be subject to all of the obligations and agreements of a
Subsidiary Guarantor under the Indenture. The Guarantor agrees to be bound by
all of the provisions of the Indenture applicable to a Subsidiary Guarantor and
to perform all of the obligations and agreements of a Subsidiary Guarantor under
the Indenture.

          SECTION 2.2 Guarantee. The Guarantor agrees, on a joint and several
basis with all the existing Subsidiary Guarantors, to fully, unconditionally and
irrevocably Guarantee to each Holder of the Securities and the Trustee the
Guarantor Obligations pursuant to Article X of the Indenture on a senior basis.

                                   ARTICLE III

                                  Miscellaneous

          SECTION 3.1 Notices. All notices and other communications to the
Guarantor shall be given as provided in the Indenture to the Guarantor, at its
address set forth below, with a copy to the Issuers as provided in the Indenture
for notices to the Issuers.

          SECTION 3.2 Parties. Nothing expressed or mentioned herein is intended
or shall be construed to give any Person, firm or corporation, other than the
Holders and the Trustee, any legal or equitable right, remedy or claim under or
in respect of this Supplemental Indenture or the Indenture or any provision
herein or therein contained.

          SECTION 3.3 Governing Law. This Supplemental Indenture shall be
governed by, and construed in accordance with, the laws of the State of New
York.

          SECTION 3.4 Ratification of Indenture; Supplemental Indentures Part of
Indenture. Except as expressly amended hereby, the Indenture is in all respects
ratified and confirmed and all the terms, conditions and provisions thereof
shall remain in full force and effect. This Supplemental Indenture shall form a
part of the Indenture for all purposes, and every Holder of Securities
heretofore or hereafter authenticated and delivered shall be bound hereby. The
Trustee makes no representation or warranty as to the validity or sufficiency of
this Supplemental Indenture.

          SECTION 3.5 Counterparts. The parties hereto may sign one or more
copies of this Supplemental Indenture in counterparts, all of which together
shall constitute one and the same agreement.

                                       B-2

<PAGE>

          SECTION 3.6 Headings. The headings of the Articles and the Sections in
this Guarantee are for convenience of reference only and shall not be deemed to
alter or affect the meaning or interpretation of any provisions hereof.

                                       B-3

<PAGE>

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

                                        [New Guarantor]

                                        By
                                           -------------------------------------
                                        Name:
                                              ----------------------------------
                                        Title:
                                               ---------------------------------

                                       B-4

<PAGE>

                                        WELLS FARGO BANK, NATIONAL ASSOCIATION,
                                        as Trustee

                                        By
                                           -------------------------------------
                                        Name:
                                              ----------------------------------
                                        Title:
                                               ---------------------------------

                                       B-5EX-10.2

 

Exhibit 10.2

AMENDED AND RESTATED CREDIT AGREEMENT

dated as of

July 6, 2006

among

STEWART & STEVENSON LLC,

STEWART & STEVENSON DISTRIBUTOR HOLDINGS LLC,

STEWART & STEVENSON POWER PRODUCTS LLC,

STEWART & STEVENSON PETROLEUM SERVICES LLC,

STEWART & STEVENSON CORP.,

S&S AGENT LLC,

as Borrowers,

The Lenders Party Hereto,

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent,

and

JPMORGAN CHASE BANK, N.A.,

as Collateral Agent

 

J.P. MORGAN SECURITIES INC.,

as Sole Bookrunner and Sole Lead Arranger

 

CHASE BUSINESS CREDIT

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page No
	ARTICLE I DEFINITIONS	 	 	2	 
	 
	 	Section 1.1	 	Defined Terms	 	 	2	 
	 
	 	Section 1.2	 	Classification of Loans and Borrowings	 	 	39	 
	 
	 	Section 1.3	 	Terms Generally	 	 	39	 
	 
	 	Section 1.4	 	Accounting Terms; GAAP	 	 	39	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE II THE CREDITS	 	 	40	 
	 
	 	Section 2.1	 	Commitments	 	 	40	 
	 
	 	Section 2.2	 	Loans and Borrowings	 	 	40	 
	 
	 	Section 2.3	 	Requests for Borrowings	 	 	41	 
	 
	 	Section 2.4	 	Protective Advances	 	 	41	 
	 
	 	Section 2.5	 	Swingline Loans and Overadvances	 	 	42	 
	 
	 	Section 2.6	 	Letters of Credit	 	 	45	 
	 
	 	Section 2.7	 	Funding of Borrowings	 	 	49	 
	 
	 	Section 2.8	 	Interest Elections	 	 	49	 
	 
	 	Section 2.9	 	Termination and Reduction of Commitments	 	 	50	 
	 
	 	Section 2.10	 	Repayment and Amortization of Loans; Evidence of Debt	 	 	51	 
	 
	 	Section 2.11	 	Prepayment of Loans	 	 	52	 
	 
	 	Section 2.12	 	Fees	 	 	53	 
	 
	 	Section 2.13	 	Interest	 	 	54	 
	 
	 	Section 2.14	 	Alternate Rate of Interest	 	 	55	 
	 
	 	Section 2.15	 	Increased Costs	 	 	56	 
	 
	 	Section 2.16	 	Break Funding Payments	 	 	57	 
	 
	 	Section 2.17	 	Taxes	 	 	57	 
	 
	 	Section 2.18	 	Payments Generally; Allocation of Proceeds; Sharing of Set-offs	 	 	58	 
	 
	 	Section 2.19	 	Mitigation Obligations; Replacement of Lenders	 	 	61	 
	 
	 	Section 2.20	 	Returned Payments	 	 	62	 
	 
	 	Section 2.21	 	Borrowings of Revolving Loans to Satisfy Secured Obligations	 	 	62	 
	 
	 	Section 2.22	 	Joint and Several Liability; Rights of Contribution	 	 	62	 
	 
	 	Section 2.23	 	Increase of Commitments	 	 	64	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE III REPRESENTATIONS AND WARRANTIES	 	 	65	 
	 
	 	Section 3.1	 	Organization; Powers	 	 	65	 
	 
	 	Section 3.2	 	Authorization; Enforceability	 	 	65	 
	 
	 	Section 3.3	 	Governmental Approvals; No Conflicts	 	 	65	 
	 
	 	Section 3.4	 	Financial Condition; No Material Adverse Change	 	 	65	 
	 
	 	Section 3.5	 	Properties	 	 	66	 
	 
	 	Section 3.6	 	Litigation and Environmental Matters	 	 	67	 
	 
	 	Section 3.7	 	Compliance with Laws and Agreements	 	 	67	 
	 
	 	Section 3.8	 	Investment and Holding Company Status	 	 	67	 
	 
	 	Section 3.9	 	Taxes	 	 	67	 
	 
	 	Section 3.10	 	ERISA	 	 	68	 
	 
	 	Section 3.11	 	Disclosure	 	 	68	 
	 
	 	Section 3.12	 	Material Agreements	 	 	68	 

i 

 

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page No
	 
	 	Section 3.13	 	Solvency	 	 	68	 
	 
	 	Section 3.14	 	Insurance	 	 	69	 
	 
	 	Section 3.15	 	Capitalization and Subsidiaries	 	 	69	 
	 
	 	Section 3.16	 	Security Interest in Collateral	 	 	69	 
	 
	 	Section 3.17	 	Labor Disputes	 	 	69	 
	 
	 	Section 3.18	 	Affiliate Transactions	 	 	69	 
	 
	 	Section 3.19	 	Common Enterprise	 	 	70	 
	 
	 	Section 3.20	 	Casualties; Taking of Properties	 	 	70	 
	 
	 	Section 3.21	 	Perfection Certificate; Schedules to other Loan Documents	 	 	70	 
	 
	 	Section 3.22	 	Existing Indebtedness	 	 	70	 
	 
	 	Section 3.23	 	Acquisition Documents	 	 	70	 
	 
	 	Section 3.24	 	Deposit Accounts	 	 	71	 
	 
	 	Section 3.25	 	Regulation H	 	 	71	 
	 
	 	Section 3.26	 	Compliance with Anti-Terrorism and Anti-Money Laundering Laws and Regulations	 	 	71	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE IV CONDITIONS	 	 	71	 
	 
	 	Section 4.1	 	Effective Date	 	 	71	 
	 
	 	Section 4.2	 	Each Credit Event	 	 	75	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE V AFFIRMATIVE COVENANTS	 	 	76	 
	 
	 	Section 5.1	 	Financial Statements; Borrowing Base and Other Information	 	 	76	 
	 
	 	Section 5.2	 	Notices of Material Events	 	 	79	 
	 
	 	Section 5.3	 	Existence; Conduct of Business	 	 	80	 
	 
	 	Section 5.4	 	Payment of Obligations	 	 	81	 
	 
	 	Section 5.5	 	Maintenance of Properties	 	 	81	 
	 
	 	Section 5.6	 	Books and Records; Inspection Rights	 	 	81	 
	 
	 	Section 5.7	 	Compliance with Laws	 	 	81	 
	 
	 	Section 5.8	 	Use of Proceeds	 	 	81	 
	 
	 	Section 5.9	 	Insurance	 	 	81	 
	 
	 	Section 5.10	 	Casualty and Condemnation	 	 	82	 
	 
	 	Section 5.11	 	Field Examinations	 	 	82	 
	 
	 	Section 5.12	 	Appraisals	 	 	82	 
	 
	 	Section 5.13	 	Depository Bank	 	 	82	 
	 
	 	Section 5.14	 	Additional Collateral; Further Assurances	 	 	82	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE VI NEGATIVE COVENANTS	 	 	84	 
	 
	 	Section 6.1	 	Indebtedness	 	 	84	 
	 
	 	Section 6.2	 	Liens	 	 	85	 
	 
	 	Section 6.3	 	Fundamental Changes	 	 	86	 
	 
	 	Section 6.4	 	Investments, Loans, Advances, Guarantees and Acquisitions	 	 	87	 
	 
	 	Section 6.5	 	Asset Sales	 	 	88	 
	 
	 	Section 6.6	 	Sale and Leaseback Transactions	 	 	89	 
	 
	 	Section 6.7	 	Swap Agreements	 	 	90	 
	 
	 	Section 6.8	 	Restricted Payments; Certain Payments of Indebtedness	 	 	90	 
	 
	 	Section 6.9	 	Transactions with Affiliates	 	 	91	 
	 
	 	Section 6.10	 	Restrictive Agreements	 	 	91	 
	 
	 	Section 6.11	 	Amendment of Material Documents	 	 	92	 

ii 

 

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page No
	 
	 	Section 6.12	 	Operating Leases	 	 	92	 
	 
	 	Section 6.13	 	Fixed Charge Coverage Ratio	 	 	92	 
	 
	 	Section 6.14	 	Limitations on Inter-Borrower Transactions	 	 	92	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE VII EVENTS OF DEFAULT	 	 	93	 
	 
	ARTICLE VIII THE AGENTS; INTERCREDITOR ISSUES	 	 	96	 
	 
	 	Section 8.1	 	Appointment of Agents	 	 	96	 
	 
	 	Section 8.2	 	Limitation of Duties of Agents	 	 	96	 
	 
	 	Section 8.3	 	Reliance by Agents	 	 	97	 
	 
	 	Section 8.4	 	Sub-Agents	 	 	97	 
	 
	 	Section 8.5	 	Resignation of Agents; Successor Agents	 	 	97	 
	 
	 	Section 8.6	 	Lender Acknowledgments	 	 	97	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE IX MISCELLANEOUS	 	 	98	 
	 
	 	Section 9.1	 	Notices	 	 	98	 
	 
	 	Section 9.2	 	Waivers; Amendments	 	 	99	 
	 
	 	Section 9.3	 	Expenses; Indemnity; Damage Waiver	 	 	101	 
	 
	 	Section 9.4	 	Successors and Assigns	 	 	103	 
	 
	 	Section 9.5	 	Survival	 	 	106	 
	 
	 	Section 9.6	 	Counterparts; Integration; Effectiveness	 	 	106	 
	 
	 	Section 9.7	 	Severability	 	 	107	 
	 
	 	Section 9.8	 	Right of Setoff	 	 	107	 
	 
	 	Section 9.9	 	Governing Law; Jurisdiction; Consent to Service of Process	 	 	107	 
	 
	 	Section 9.10	 	WAIVER OF JURY TRIAL	 	 	108	 
	 
	 	Section 9.11	 	Headings	 	 	108	 
	 
	 	Section 9.12	 	Confidentiality	 	 	108	 
	 
	 	Section 9.13	 	Several Obligations; Nonreliance; Violation of Law	 	 	109	 
	 
	 	Section 9.14	 	USA Patriot Act	 	 	109	 
	 
	 	Section 9.15	 	Disclosure	 	 	109	 
	 
	 	Section 9.16	 	Appointment for Perfection	 	 	109	 
	 
	 	Section 9.17	 	Interest Rate Limitation	 	 	110	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE X LOAN GUARANTY	 	 	110	 
	 
	 	Section 10.1	 	Guaranty	 	 	110	 
	 
	 	Section 10.2	 	Guaranty of Payment	 	 	110	 
	 
	 	Section 10.3	 	No Discharge or Diminishment of Loan Guaranty	 	 	110	 
	 
	 	Section 10.4	 	Defenses Waived	 	 	111	 
	 
	 	Section 10.5	 	Rights of Subrogation	 	 	112	 
	 
	 	Section 10.6	 	Reinstatement; Stay of Acceleration	 	 	112	 
	 
	 	Section 10.7	 	Information	 	 	112	 
	 
	 	Section 10.8	 	Termination	 	 	112	 
	 
	 	Section 10.9	 	Taxes	 	 	112	 
	 
	 	Section 10.10	 	Maximum Liability	 	 	113	 
	 
	 	Section 10.11	 	Contribution	 	 	113	 
	 
	 	Section 10.12	 	Liability Cumulative	 	 	114	 

iii 

 

	 	 	 
	EXHIBITS	 	 
	 
	Exhibit A

	 	Assignment and Assumption
	Exhibit B

	 	Opinion of Counsel for the Borrowers
	Exhibit C

	 	Borrowing Base Certificate
	Exhibit D

	 	Compliance Certificate
	Exhibit E

	 	Joinder Agreement
	Exhibit F

	 	Commitment Increase Agreement
	Exhibit G

	 	New Lender Agreement
	Exhibit H

	 	Perfection Certificate Update
	Exhibit I

	 	Certificate of Effectiveness

	 	 	 	 	 
	SCHEDULES

	 
	Commitment Schedule
	Schedule I

	 	-
	 	Compliance
	Schedule II

	 	-
	 	Borrower Applicable Rate Calculation
	Schedule 1.1

	 	-
	 	Permitted Fixed Asset Dispositions
	Schedule 3.5

	 	-
	 	Properties
	Schedule 3.6

	 	-
	 	Disclosed Matters
	Schedule 3.12

	 	-
	 	Material Agreements
	Schedule 3.14

	 	-
	 	Insurance
	Schedule 3.15

	 	-
	 	Capitalization and Subsidiaries
	Schedule 3.18

	 	-
	 	Affiliate Transactions
	Schedule 3.22

	 	-
	 	Existing Indebtedness
	Schedule 3.24

	 	-
	 	Deposit Accounts
	Schedule 6.1

	 	-
	 	Indebtedness
	Schedule 6.2

	 	-
	 	Liens
	Schedule 6.4

	 	-
	 	Investments
	Schedule 6.10

	 	-
	 	Restrictions and Conditions

iv 

 

LIST OF DEFINED TERMS

	 	 	 	 	 
	 	 	Page No.
	$ 
	 	 	13	 
	ABR
	 	 	2	 
	Account
	 	 	2	 
	Account Debtor
	 	 	2	 
	Acquisition
	 	 	2	 
	Acquisition Agreements
	 	 	3	 
	Acquisition Documents
	 	 	3	 
	Act
	 	 	109	 
	Activation Period
	 	 	3	 
	Adjusted LIBO Rate
	 	 	3	 
	Adjusted Net Worth
	 	 	3	 
	Administrative Agent
	 	 	3	 
	Administrative Questionnaire
	 	 	3	 
	Affiliate
	 	 	3	 
	Agents
	 	 	3	 
	Aggregate Credit Exposure
	 	 	3	 
	Agreement
	 	 	1	 
	Alternate Base Rate
	 	 	3	 
	Annualized
	 	 	4	 
	Ansary Related Parties
	 	 	4	 
	Applicable Percentage
	 	 	4	 
	Applicable Rate
	 	 	4	 
	Approved Fund
	 	 	104	 
	Assignment and Assumption
	 	 	5	 
	Availability
	 	 	5	 
	Availability Period
	 	 	5	 
	Available Revolving Commitment
	 	 	5	 
	Banking Services
	 	 	5	 
	Banking Services Obligations
	 	 	5	 
	Banking Services Reserves
	 	 	6	 
	Base Value
	 	 	6	 
	Beneficially Own
	 	 	10	 
	Board
	 	 	6	 
	Borrower
	 	 	1	 
	Borrowers
	 	 	1	 
	Borrowing
	 	 	6	 
	Borrowing Base
	 	 	6	 
	Borrowing Base Certificate
	 	 	9	 
	Borrowing Base Reserves
	 	 	9	 
	Borrowing Request
	 	 	9	 
	Business Day
	 	 	9	 
	Capital Expenditures
	 	 	10	 
	Capital Lease Obligations
	 	 	10	 

v 

 

	 	 	 	 	 
	 	 	Page No.
	Certificate of Effectiveness
	 	 	10	 
	Change in Control
	 	 	10	 
	Change in Law
	 	 	11	 
	Charges
	 	 	110	 
	Chase
	 	 	11	 
	Class
	 	 	11	 
	Closing Date Acquisition
	 	 	11	 
	Code
	 	 	11	 
	Collateral
	 	 	11	 
	Collateral Access Agreement
	 	 	11	 
	Collateral Agent
	 	 	11	 
	Collateral Documents
	 	 	11	 
	Collection Accounts
	 	 	11	 
	Commitment
	 	 	11	 
	Commitment Increase Agreement
	 	 	12	 
	Commitment Increase Notice
	 	 	64	 
	Commitment Reserves
	 	 	12	 
	Commitment Schedule
	 	 	12	 
	Company
	 	 	1	 
	Control
	 	 	12	 
	Controlled
	 	 	12	 
	Controlled Disbursement Account
	 	 	12	 
	Controlling
	 	 	12	 
	Credit Exposure
	 	 	12	 
	Current Financials
	 	 	12	 
	Dated Assets
	 	 	63	 
	Dated Liabilities
	 	 	63	 
	Default
	 	 	13	 
	Departing Lender
	 	 	62	 
	Detroit Diesel
	 	 	13	 
	Deutz
	 	 	13	 
	Dilution Factors
	 	 	13	 
	Dilution Ratio
	 	 	13	 
	Dilution Reserve
	 	 	13	 
	Disclosed Matters
	 	 	13	 
	Document
	 	 	13	 
	Dollars
	 	 	13	 
	EBITDA
	 	 	13	 
	Effective Date
	 	 	14	 
	Eligible Accounts
	 	 	14	 
	Eligible Equipment
	 	 	17	 
	Eligible Inventory
	 	 	17	 
	Eligible Mortgaged Real Property
	 	 	19	 
	Engineered Products Division
	 	 	19	 
	Environmental Laws
	 	 	19	 
	Environmental Liability
	 	 	20	 

vi 

 

	 	 	 	 	 
	 	 	Page No.
	EPD Purchase Agreement
	 	 	20	 
	Equity Interests
	 	 	20	 
	ERISA
	 	 	20	 
	ERISA Affiliate
	 	 	20	 
	ERISA Event
	 	 	20	 
	Eurodollar
	 	 	21	 
	Eurodollar Borrowing
	 	 	39	 
	Eurodollar Loan
	 	 	39	 
	Eurodollar Revolving Loan
	 	 	39	 
	Eurodollar Revolving Loan Borrowing
	 	 	39	 
	Events of Default
	 	 	93	 
	Excess Cash Flow
	 	 	21	 
	Excluded Subsidiary
	 	 	21	 
	Excluded Taxes
	 	 	21	 
	Ex-Im Bank
	 	 	21	 
	Existing Borrowers
	 	 	1	 
	Existing Credit Agreement
	 	 	1	 
	Existing Loan Documents
	 	 	1	 
	Federal Funds Effective Rate
	 	 	22	 
	Fee Letter
	 	 	22	 
	Financial Accommodation
	 	 	93	 
	Financial Officer
	 	 	22	 
	Fixed Asset Collateral
	 	 	22	 
	Fixed Asset Component
	 	 	22	 
	Fixed Charge Coverage Ratio
	 	 	22	 
	Fixed Charges
	 	 	22	 
	Foreign Lender
	 	 	23	 
	Funding Account
	 	 	73	 
	GAAP
	 	 	23	 
	Governmental Authority
	 	 	23	 
	Group
	 	 	10	 
	Guarantee
	 	 	23	 
	Guaranteed Obligations
	 	 	110	 
	guarantor
	 	 	23	 
	Hazardous Materials
	 	 	23	 
	Hyster
	 	 	23	 
	Indebtedness
	 	 	23	 
	Indemnified Taxes
	 	 	24	 
	Indemnitee
	 	 	102	 
	Information
	 	 	109	 
	Information Memorandum
	 	 	24	 
	Interest Election Request
	 	 	24	 
	Interest Expense
	 	 	24	 
	Interest Payment Date
	 	 	24	 
	Interest Period
	 	 	24	 
	Inventory
	 	 	25	 

vii 

 

	 	 	 	 	 
	 	 	Page No.
	Issuing Bank
	 	 	25	 
	Joinder Agreement
	 	 	83	 
	LC Collateral Account
	 	 	48	 
	LC Disbursement
	 	 	25	 
	LC Exposure
	 	 	25	 
	LC Shortfall Amount
	 	 	25	 
	Lenders
	 	 	25	 
	Letter of Credit
	 	 	25	 
	Leverage Ratio
	 	 	25	 
	LIBO Rate
	 	 	26	 
	Lien
	 	 	26	 
	Loan Documents
	 	 	26	 
	Loan Guarantor
	 	 	26	 
	Loan Guaranty
	 	 	26	 
	Loan Parties
	 	 	26	 
	Loans
	 	 	26	 
	Lock Box
	 	 	27	 
	Lock Box Agreement
	 	 	27	 
	Material Adverse Effect
	 	 	27	 
	Material Indebtedness
	 	 	27	 
	Maturity Date
	 	 	27	 
	Maximum Liability
	 	 	113	 
	Maximum Rate
	 	 	110	 
	Monthly Fixed Asset Amortization Amount
	 	 	27	 
	Moody’s
	 	 	27	 
	Mortgages
	 	 	27	 
	Multiemployer Plan
	 	 	27	 
	Net Income
	 	 	27	 
	Net Orderly Liquidation Value
	 	 	28	 
	Net Proceeds
	 	 	28	 
	New Lender
	 	 	65	 
	New Lender Agreement
	 	 	28	 
	Non Financed Capital Expenditures
	 	 	28	 
	non SSPP Borrowings
	 	 	93	 
	Non-Consenting Lender
	 	 	101	 
	Non-Paying Guarantor
	 	 	113	 
	Obligated Party
	 	 	110	 
	Obligations
	 	 	28	 
	OFAC
	 	 	71	 
	Off-Balance Sheet Liability
	 	 	29	 
	Other Secured Parties
	 	 	29	 
	Other Taxes
	 	 	29	 
	Overadvances
	 	 	44	 
	parent
	 	 	38	 
	Participant
	 	 	105	 
	Paying Guarantor
	 	 	113	 

viii 

 

	 	 	 	 	 
	 	 	Page No.
	PBGC
	 	 	29	 
	Perfection Certificate
	 	 	29	 
	Perfection Certificate Update
	 	 	29	 
	Permitted Acquisition
	 	 	29	 
	Permitted Discretion
	 	 	31	 
	Permitted Encumbrances
	 	 	31	 
	Permitted Fixed Asset Disposition
	 	 	33	 
	Permitted Investments
	 	 	32	 
	Permitted Senior Encumbrances
	 	 	33	 
	Person
	 	 	33	 
	Plan
	 	 	33	 
	Pledge and Security Agreement
	 	 	33	 
	Power Products Division
	 	 	34	 
	PPD Purchase Agreement
	 	 	34	 
	Prepayment Event
	 	 	34	 
	primary obligor
	 	 	23	 
	Prime Rate
	 	 	34	 
	Proceeds
	 	 	34	 
	Projections
	 	 	77	 
	Protective Advances
	 	 	42	 
	Qualified Public Offering
	 	 	34	 
	Real Property
	 	 	35	 
	Register
	 	 	105	 
	Related Parties
	 	 	35	 
	Related Person
	 	 	11	 
	Rent Reserve
	 	 	35	 
	Report
	 	 	35	 
	Required Lenders
	 	 	35	 
	Requirement of Law
	 	 	35	 
	Reserves
	 	 	35	 
	Responsible Officer
	 	 	35	 
	Restricted Payment
	 	 	35	 
	Revolving Commitment
	 	 	36	 
	Revolving Exposure
	 	 	36	 
	Revolving Lender
	 	 	36	 
	Revolving Loan
	 	 	39	 
	Revolving Loan Borrowing
	 	 	39	 
	S&P
	 	 	36	 
	Secured Obligations
	 	 	36	 
	Security Agreement
	 	 	36	 
	Senior Notes
	 	 	36	 
	Senior Notes Documents
	 	 	37	 
	Senior Notes Indenture
	 	 	37	 
	Senior Notes Offering
	 	 	37	 
	Senior Notes Offering Memorandum
	 	 	37	 
	Settlement
	 	 	45	 

ix 

 

	 	 	 	 	 
	 	 	Page No.
	Settlement Date
	 	 	45	 
	Special Vendor Payable Reserve
	 	 	37	 
	SSA
	 	 	1	 
	SSC
	 	 	1	 
	SSDH
	 	 	1	 
	SSPP
	 	 	1	 
	SSPS
	 	 	1	 
	Statutory Reserve Rate
	 	 	37	 
	Subject Borrower
	 	 	63	 
	Subordinated Indebtedness
	 	 	38	 
	subsidiary
	 	 	38	 
	Subsidiary
	 	 	38	 
	Supermajority Revolving Lenders
	 	 	38	 
	Swap Agreement
	 	 	38	 
	Swap Obligations
	 	 	38	 
	Swingline Lender
	 	 	38	 
	Swingline Loan
	 	 	38	 
	Syndication Agent
	 	 	38	 
	Taxes
	 	 	38	 
	Total Indebtedness
	 	 	39	 
	Transactions
	 	 	39	 
	True-Up Loans
	 	 	2	 
	Type
	 	 	39	 
	UCC
	 	 	39	 
	Unliquidated Obligations
	 	 	39	 
	Unrelated Person
	 	 	10	 
	Withdrawal Liability
	 	 	39	 

x 

 

AMENDED AND RESTATED CREDIT AGREEMENT

     AMENDED AND RESTATED CREDIT AGREEMENT dated as of July 6, 2006 (as it may be amended or
modified from time to time, this “Agreement”), among STEWART & STEVENSON LLC, a Delaware
limited liability company (“Company”), STEWART & STEVENSON DISTRIBUTOR HOLDINGS LLC, a
Delaware limited liability company (“SSDH”), STEWART & STEVENSON POWER PRODUCTS LLC, a
Delaware limited liability company (“SSPP”), STEWART & STEVENSON PETROLEUM SERVICES LLC, a
Delaware limited liability company (“SSPS”), STEWART & STEVENSON CORP., a Delaware
corporation (“SSC”), S&S AGENT LLC, a Delaware limited liability company (“SSA” and
collectively with the Company, SSDH, SSPP, SSPS and SSC, the “Borrowers” and each
individually, a “Borrower”), the Lenders party hereto, JPMORGAN CHASE BANK, N.A., as the
Administrative Agent, and JPMORGAN CHASE BANK, N.A., as the Collateral Agent.

RECITALS:

     WHEREAS, the Company, SSDH, SSPP and SSPS (collectively, the “Existing Borrowers”),
SSC and SSA, the Agents, certain lenders party thereto and JPMorgan Chase Bank, N.A., as the Export
Related Lender (as defined in the Existing Credit Agreement), are parties to that certain Credit
Agreement dated as of January 25, 2006 (as heretofore amended, the “Existing Credit
Agreement”), pursuant to which JPMorgan Chase Bank, N.A. and certain other lenders parties
thereto extended certain financing to the Existing Borrowers in accordance with the terms and
conditions set forth therein; and

     WHEREAS, the Borrowers have requested that the Existing Credit Agreement be amended and
restated in its entirety.

AGREEMENTS:

     In consideration of the mutual covenants and agreements herein contained, the Borrowers, the
Agents, the Issuing Bank and the Lenders agree that, subject to the satisfaction of each condition
precedent contained in Section 4.1 hereof, the satisfaction of which shall be evidenced by the
execution and delivery by the Borrowers and the Administrative Agent of the Certificate of
Effectiveness (as herein defined), the Existing Credit Agreement shall be amended and restated as
of the Effective Date (as herein defined) in its entirety in the form of this Agreement. It is the
intention of the Borrowers, the Lenders, the Issuing Bank and the Agents that this Agreement
supersede and replace the Existing Credit Agreement in its entirety; provided,
that, (a) such amendment and restatement shall operate to renew, amend and modify the
rights and obligations of the parties under the Existing Credit Agreement, as provided herein, but
shall not effect a novation thereof, (b) unless otherwise provided for herein and evidenced by a
separate written agreement, amendment or release, no other Loan Document, as defined in, and
executed and/or delivered pursuant to the terms of, the Existing Credit Agreement (collectively,
the “Existing Loan Documents”) shall be amended, terminated or released in any respect and
all of such other Existing Loan Documents shall remain in full force and effect except that the
Borrowers and the Lenders agree that by executing this Agreement the definition of “Credit
Agreement” contained in such Existing Loan Documents shall be amended to refer to this Agreement as
it may hereafter be amended, modified, renewed or extended in accordance with

1

 

the terms hereof in place of the Existing Credit Agreement, and (c) the Liens securing the
Secured Obligations under and as defined in the Existing Credit Agreement and granted pursuant to
the Existing Loan Documents and the liabilities and obligations of the Borrowers shall not be
extinguished, but shall be carried forward, and such Liens shall secure such Secured Obligations,
in each case, as renewed, amended, restated and modified hereby.

     Upon delivery of the Certificate of Effectiveness, (a) each Lender who holds Revolving Loans
in an aggregate amount less than its Applicable Percentage (after giving effect to this amendment
and restatement) of all Revolving Loans shall advance new Revolving Loans which shall be disbursed
to the Administrative Agent and used to repay Revolving Loans outstanding to each Lender who holds
Revolving Loans in an aggregate amount greater than its Applicable Percentage of all Revolving
Loans, (b) each Lender’s participation in each Letter of Credit shall be automatically adjusted to
equal its Applicable Percentage (after giving effect to this amendment and restatement), (c) such
other adjustments shall be made as the Administrative Agent shall specify so that each Lender’s
Credit Exposure equals its Applicable Percentage (after giving effect to this amendment and
restatement) of the Aggregate Credit Exposure. The loans and/or adjustments described in this
paragraph are referred to herein as the “True-Up Loans”.

     The parties hereto further agree as follows:

ARTICLE I

DEFINITIONS

     Section 1.1 Defined Terms. As used in this Agreement, the following terms have the
meanings specified below:

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

     “Account” has the meaning assigned to such term in the Pledge and Security Agreement.

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

     “Acquisition” means any transaction, or any series of related transactions,
consummated on or after the date of this Agreement, by which any Loan Party (a) acquires any going
business or all or substantially all of the assets of any Person, whether through purchase of
assets, merger or otherwise or (b) directly or indirectly acquires (in one transaction or as the
most recent transaction in a series of transactions) at least a majority (in number of votes) of
the Equity Interests of a Person which has ordinary voting power for the election of directors or
other similar management personnel of a Person (other than Equity Interests having such power only
by reason of the happening of a contingency) or a majority of the outstanding Equity Interests of a
Person.

     “Acquisition Agreements” means the EPD Purchase Agreement and the PPD Purchase
Agreement.

2

 

     “Acquisition Documents” means the Acquisition Agreements and all other agreements or
instruments executed in connection with the Closing Date Acquisition.

     “Activation Period” means any period commencing on the date that Availability is less
than $25,000,000, and continuing until the date that both (a) Availability exceeds $25,000,000 for
ninety (90) consecutive calendar days and (b) no Default or Event of Default then exists or has
existed during such ninety (90) consecutive calendar day period.

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

     “Adjusted Net Worth” shall mean, with respect to SSPP, the shareholders equity of SSPP
on a consolidating balance sheet for SSPP prepared in accordance with GAAP, but adjusted to treat
as a liability on the balance sheet of SSPP the full amount outstanding of all non-SSPP Borrowings
and all Financial Accommodations then outstanding.

     “Administrative Agent” means JPMorgan Chase Bank, N.A., in its capacity as
administrative agent for the Lenders hereunder and its successors and assigns in such capacity.

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

     “Affiliate” means, with respect to a specified Person, another Person that directly,
or indirectly through one or more intermediaries, Controls or is Controlled by or is under common
Control with the Person specified.

     “Agents” shall mean the Administrative Agent and the Collateral Agent together, and
“Agent” shall mean either of such Agents individually.

     “Aggregate Credit Exposure” means, at any time, the aggregate Credit Exposure of all
the Lenders.

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

     “Ansary Related Parties” means Mr. Hushang Ansary, his family members or Persons in
which all Equity Interests in such Persons are owned or otherwise Controlled solely by Hushang
Ansary and/or members of his family.

     “Annualized” means, for purposes of calculating the Leverage Ratio hereunder for the
periods ending on (a) August 5, 2006, such actual specified amount, for the two consecutive fiscal
quarter period then ended, multiplied by 2.0, and (b) November 4, 2006, such actual

3

 

specified amount, for the three consecutive fiscal quarter period then ended, multiplied by
1.333334.

     “Applicable Percentage” means, with respect to any Lender, (a) with respect to
Revolving Loans, LC Exposure, Swingline Loans or Overadvances, a percentage equal to a fraction the
numerator of which is such Lender’s Revolving Commitment and the denominator of which is the
aggregate Revolving Commitments of all Revolving Lenders (if the Revolving Commitments have
terminated or expired, the Applicable Percentages shall be determined based upon such Revolving
Lender’s share of the aggregate Revolving Exposures at that time), and (b) with respect to
Protective Advances or with respect to the Aggregate Credit Exposure, a percentage based upon its
share of the Aggregate Credit Exposure and the unused Commitments.

     “Applicable Rate” means, for any day, with respect to any ABR Loan or Eurodollar Loan,
as the case may be, the applicable rate per annum set forth below under the caption “ABR Spread” or
“Eurodollar Spread”, as the case may be, based upon the Borrowers’ Leverage Ratio as of the most
recent determination date, provided that until the delivery to the Administrative
Agent, pursuant to Section 5.1, of the Company’s consolidated financial information for the
Company’s fiscal quarter ending August 5, 2006 the “Applicable Rate” shall be the applicable rate
per annum set forth below in Category 6:

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Eurodollar
	                       Leverage Ratio	 	ABR Spread	 	Spread
	Category 1
> 6.5 to 1.0
	 	 	0.375	%	 	 	2.125	%
	Category 2
£ 6.5 to 1.0 but
> 6.0 to 1.0
	 	 	0.25	%	 	 	2.00	%
	Category 3
£ 6.0 to 1.0 but
> 5.5 to 1.0
	 	 	0.125	%	 	 	1.875	%
	Category 4
£ 5.5 to 1.0 but
> 4.5 to 1.0
	 	 	0	%	 	 	1.75	%
	Category 5
£ 4.5 to 1.0 but
> 3.5 to 1.0
	 	 	0	%	 	 	1.625	%
	Category 6
£ 3.5 to 1.0 but
> 2.5 to 1.0
	 	 	0	%	 	 	1.50	%
	Category 7
£ 2.5 to 1.0
	 	 	0	%	 	 	1.375	%

     For purposes of the foregoing and subject to the foregoing proviso, (a) the Applicable
Rate shall be determined as of the end of each fiscal quarter of the Borrowers based upon the
Company’s annual or quarterly consolidated financial statements delivered pursuant to Section 5.1
and (b) each change in the Applicable Rate resulting from a change in the Leverage Ratio shall be
effective during the period commencing on and including the date of delivery to the Administrative
Agent of such consolidated financial statements indicating such change and ending on the date
immediately preceding the effective date of the next such change, provided

4

 

that the Leverage Ratio shall be deemed to be in Category 1 at the option of the
Administrative Agent or at the request of the Required Lenders if the Borrowers fail to deliver the
annual or quarterly consolidated financial statements required to be delivered by them pursuant to
Section 5.1, during the period from the expiration of the time for delivery thereof until such
consolidated financial statements are delivered.

     “Approved Fund” has the meaning assigned to such term in Section 9.4.

     “Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an assignee (with the consent of any party whose consent is required by Section 9.4),
and accepted by the Administrative Agent, in the form of Exhibit A or any other form
approved by the Administrative Agent.

     “Available Revolving Commitment” means, with respect to each Revolving Lender at any
time, the Revolving Commitment of such Revolving Lender then in effect minus the Revolving Exposure
of such Revolving Lenders at such time.

     “Availability” means, at any time, an amount equal to (a) the lesser of the total
Revolving Commitments and the Borrowing Base minus (b) the Commitment Reserves minus (c) the
aggregate Revolving Exposure of all Revolving Lenders.

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

     “Banking Services” means each and any of the following bank services provided to any
Loan Party by any Lender or any of its Affiliates: (a) commercial credit cards, (b) stored value
cards and (c) treasury management services (including, without limitation, controlled disbursement,
automated clearinghouse transactions, return items, overdrafts and interstate depository network
services).

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

     “Banking Services Reserves” means all Reserves which the Administrative Agent from
time to time establishes in its Permitted Discretion for Banking Services then provided or
outstanding.

     “Base Value” means, with respect to certain categories of Eligible Inventory, the
lower of (a) cost (determined on a first in first out basis in accordance with GAAP and excluding
any component of cost consisting of intercompany profit with respect to such Eligible Inventory
acquired from an Affiliate), or (b) market value.

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

5

 

     “Borrower” or “Borrowers” shall have the meanings set forth in the initial
paragraph hereof and shall include any other Person who becomes a Borrower under this Agreement and
their successors and assigns.

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

     “Borrowing Base” means, at any time, the sum of (a) 85% of the Borrowers’ Eligible
Accounts at such time, plus (b) the lesser of (i) $125,000,000 (subject to an upward adjustment on
a dollar for dollar basis not to exceed $150,000,000 upon any increase in the Revolving Commitment
pursuant to Section 2.23 hereof), and (ii) the sum of the following:

     (1) the lesser of (A) 65% of the Base Value of the Borrowers’ Eligible Inventory consisting of
primary finished goods of the Borrowers’ Engineered Products Division, and (B) the sum of (x) 85%
of the Net Orderly Liquidation Value of the Borrowers’ Eligible Inventory consisting of primary
finished goods of the Borrowers’ Engineered Products Division (as reflected on the most recent
appraisal completed pursuant to Section 5.12 (and prior to the first such appraisal, the appraisal
received by the Administrative Agent prior to the Effective Date)), plus (y) the book value of the
Borrowers’ Eligible Inventory consisting of primary finished goods of the Borrowers’ Engineered
Products Division purchased after the date of the Inventory appraisal referred to in the foregoing
clause (x), minus (z) the book value of the Borrowers’ Eligible Inventory consisting of primary
finished goods of the Borrowers’ Engineered Products Division sold, retired or otherwise disposed
of and depreciated after the date of the Inventory appraisal referred to in the foregoing clause
(x), plus

     (2) the lesser of (A) 65% of the Base Value of the Borrowers’ Eligible Inventory consisting of
engine and transmission units of the Borrowers’ Power Products Division, and (B) the sum of (x) 85%
of the Net Orderly Liquidation Value of the Borrowers’ Eligible Inventory consisting of engine and
transmission units of the Borrowers’ Power Products Division (as reflected on the most recent
appraisal completed pursuant to Section 5.12 (and prior to the first such appraisal, the appraisal
received by the Administrative Agent prior to the Effective Date)), plus (y) the book value of the
Borrowers’ Eligible Inventory consisting of engine and transmission units of the Borrowers’ Power
Products Division purchased after the date of the Inventory appraisal referred to in the foregoing
clause (x), minus (z) the book value of the Borrowers’ Eligible Inventory consisting of engine and
transmission units of the Borrowers’ Power Products Division sold, retired or otherwise disposed of
and depreciated after the date of the Inventory appraisal referred to in the foregoing clause (x),
plus

     (3) the lesser of (A) $40,000,000, and (B) the sum of the following:

     (I) the lesser of (A) 65% of the Base Value of the Borrowers’ Eligible
Inventory consisting of active parts of the Borrowers’ Power Products Division, and
(B) the sum of (x) 85% of the Net Orderly Liquidation Value of the Borrowers’
Eligible Inventory consisting of active parts of the Borrowers’ Power Products
Division (as reflected on the most recent appraisal completed pursuant to Section
5.12 (and prior to the first such appraisal, the appraisal received by the

6

 

Administrative Agent prior to the Effective Date)), plus (y) the book value of
the Borrowers’ Eligible Inventory consisting of active parts of the Borrowers’ Power
Products Division purchased after the date of the Inventory appraisal referred to in
the foregoing clause (x), minus (z) the book value of the Borrowers’ Eligible
Inventory consisting of active parts of the Borrowers’ Power Products Division sold,
retired or otherwise disposed of and depreciated after the date of the Inventory
appraisal referred to in the foregoing clause (x), plus

     (II) the lesser of (A) 65% of the Base Value of the Borrowers’ Eligible
Inventory consisting of parts of the Borrowers’ Engineered Products Division, and
(B) the sum of (x) 85% of the Net Orderly Liquidation Value of the Borrowers’
Eligible Inventory consisting of parts of the Borrowers’ Engineered Products
Division (as reflected on the most recent appraisal completed pursuant to Section
5.12 (and prior to the first such appraisal, the appraisal received by the
Administrative Agent prior to the Effective Date)), plus (y) the book value of the
Borrowers’ Eligible Inventory consisting of parts of the Borrowers’ Engineered
Products Division purchased after the date of the Inventory appraisal referred to in
the foregoing clause (x), minus (z) the book value of the Borrowers’ Eligible
Inventory consisting of parts of the Borrowers’ Engineered Products Division sold,
retired or otherwise disposed of and depreciated after the date of the Inventory
appraisal referred to in the foregoing clause (x).

     , plus

     (4) the least of (A) $2,500,000, (B) 65% of the Base Value of the Borrowers’ Eligible
Inventory consisting of dirty cores, and (C) the sum of (x) 85% of the Net Orderly Liquidation
Value of the Borrowers’ Eligible Inventory consisting of dirty cores (as reflected on the most
recent appraisal completed pursuant to Section 5.12 (and prior to the first such appraisal, the
appraisal received by the Administrative Agent prior to the Effective Date)), plus (y) the book
value of the Borrowers’ Eligible Inventory consisting of dirty cores purchased after the date of
the Inventory appraisal referred to in the foregoing clause (x), minus (z) the book value of the
Borrowers’ Eligible Inventory consisting of dirty cores sold, retired or otherwise disposed of and
depreciated after the date of the Inventory appraisal referred to in the foregoing clause (x), plus

     (5) the lesser of (A) 65% of the Base Value of the Borrowers’ Eligible Inventory consisting of
custom built work-in-process of the Borrowers’ Power Products Division, and (B) the sum of (x) 85%
of the Net Orderly Liquidation Value of the Borrowers’ Eligible Inventory consisting of custom
built work-in-process of the Borrowers’ Power Products Division (as reflected on the most recent
appraisal completed pursuant to Section 5.12 (and prior to the first such appraisal, the appraisal
received by the Administrative Agent prior to the Effective Date)), plus (y) the book value of the
Borrowers’ Eligible Inventory consisting of custom built work-in-process of the Borrowers’ Power
Products Division purchased or manufactured after the date of the Inventory appraisal referred to
in the foregoing clause (x), minus (z) the book value of the Borrowers’ Eligible Inventory
consisting of custom built work-in-process of the Borrowers’ Power Products Division sold, retired
or otherwise disposed of and depreciated after the date of the Inventory appraisal referred to in
the foregoing clause (x), plus

7

 

     (6) the lesser of (A) 65% of the Base Value of the Borrowers’ Eligible Inventory consisting of
identifiable work-in-process of the Borrowers’ Engineered Products Division, and (B) the sum of (x)
85% of the Net Orderly Liquidation Value of the Borrowers’ Eligible Inventory consisting of
identifiable work-in-process of the Borrowers’ Engineered Products Division (as reflected on the
most recent appraisal completed pursuant to Section 5.12 (and prior to the first such appraisal,
the appraisal received by the Administrative Agent prior to the Effective Date)), plus (y) the book
value of the Borrowers’ Eligible Inventory consisting of identifiable work-in-process of the
Borrowers’ Engineered Products Division purchased or manufactured after the date of the Inventory
appraisal referred to in the foregoing clause (x), minus (z) the book value of the Borrowers’
Eligible Inventory consisting of identifiable work-in-process of the Borrowers’ Engineered Products
Division sold, retired or otherwise disposed of and depreciated after the date of the Inventory
appraisal referred to in the foregoing clause (x), plus

     (7) the lesser of (A) $45,000,000 and (B) the sum of (x) 90% of the Net Orderly Liquidation
Value of the Borrowers’ Eligible Inventory consisting of rental equipment (other than rolling
stock) (as reflected on the most recent appraisal completed pursuant to Section 5.12 (and prior to
the first such appraisal, the appraisal received by the Administrative Agent prior to the Effective
Date)), plus (y) the book value of the Borrowers’ Eligible Inventory consisting of rental equipment
(other than rolling stock) purchased after the date of the Inventory appraisal referred to in the
foregoing clause (x), minus (z) the book value of the Borrowers’ Eligible Inventory consisting of
rental equipment (other than rolling stock) sold, retired or otherwise disposed of and depreciated
after the date of the Inventory appraisal referred to in the foregoing clause (x), plus

     (8) the lesser of (A) $5,000,000 and (B) the sum of (x) 85% of the Net Orderly Liquidation
Value of the Borrowers’ Eligible Inventory consisting of rolling stock (as reflected on the most
recent appraisal completed pursuant to Section 5.12 (and prior to the first such appraisal, the
appraisal received by the Administrative Agent prior to the Effective Date)), plus (y) the book
value of the Borrowers’ Eligible Inventory consisting of rolling stock purchased after the date of
the Inventory appraisal referred to in the foregoing clause (x), minus (z) the book value of the
Borrowers’ Eligible Inventory consisting of rolling stock sold, retired or otherwise disposed of
and depreciated after the date of the Inventory appraisal referred to in the foregoing clause (x),
plus

     (9) the Fixed Asset Component, minus

     (10) Borrowing Base Reserves.

     The Administrative Agent may, in its Permitted Discretion, reduce the advance rates set forth
above, or reduce one or more of the other elements used in computing the Borrowing Base, with any
such changes to be effective three (3) days after delivery of notice thereof to the Borrowers and
the Lenders. The Borrowing Base at any time shall be determined by reference to the most recent
Borrowing Base Certificate delivered to the Administrative Agent pursuant to Section 5.1(g) subject
to (i) the right of the Administrative Agent to redetermine any component of the Borrowing Base or
the calculation thereof if and to the extent the Administrative Agent believes, in its Permitted
Discretion, such component or calculation to be incorrect (any such

8

 

redetermination made in its Permitted Discretion and absent manifest error shall be conclusive and
binding on the Borrowers) and provided that the Administrative Agent gives the Borrowers
contemporaneous notice of such redetermination, and (ii) immediate adjustment as a result of (A)
the establishment or release of Borrowing Base Reserves, (B) reductions in the Fixed Asset
Component by the amount of the Monthly Fixed Asset Amortization Amount, (C) reduction in advance
rates provided for herein, (D) subject to the three (3) day period set forth above, changes in
eligibility criteria or standards imposed by the Administrative Agent, and (E) the occurrence of a
Permitted Fixed Asset Disposition.

     “Borrowing Base Certificate” means a certificate, signed and certified as accurate and
complete by a Financial Officer of each of the Borrowers, in substantially the form of Exhibit
C or another form which is acceptable to the Administrative Agent in its sole discretion.

     “Borrowing Base Reserves” means any and all reserves which the Administrative Agent
deems necessary, in its Permitted Discretion, to establish with respect to the Borrowing Base and
which will be deducted in the calculation of the Borrowing Base. Such Borrowing Base Reserves
include, without limitation, Banking Services Reserves, Dilution Reserves at any time that the
Dilution Ratio is greater than 5%, reserves for slow moving Inventory, reserves for contingent
liabilities of any Loan Party, reserves for uninsured losses of any Loan Party, and reserves for
uninsured, underinsured, un-indemnified or under-indemnified liabilities or potential liabilities
with respect to any litigation with respect to the Collateral or any Loan Party; provided, that
Borrowing Base Reserves shall not include any reserves specifically described under the definition
of “Commitment Reserves”.

     “Borrowing Request” means a request by the Borrowers for a Revolving Loan Borrowing in
accordance with Section 2.2 and Section 2.3.

     “Business Day” means any day that is not a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to remain closed;
provided that, when used in connection with a Eurodollar Loan, the term
“Business Day” shall also exclude any day on which banks are not open for dealings in
dollar deposits in the London interbank market.

     “Capital Expenditures” means, with respect to any Person, without duplication, any
expenditure or commitment to expend money by such Person for any purchase or other acquisition of
any asset which would be classified as a fixed or capital asset on a consolidated balance sheet of
such Person and its Subsidiaries prepared in accordance with GAAP.

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

     “Certificate of Effectiveness” shall mean a Certificate of Effectiveness in the form
of Exhibit I attached hereto to be executed by the Borrowers and the Administrative Agent
upon the

9

 

satisfaction (or waiver in accordance with Section 9.2) of each
of the conditions precedent contained in Section 4.1 hereof.

     “Change in Control” means (a) (i) prior to the completion of a Qualified Public
Offering, Ansary Related Parties shall cease to own, free and clear of all Liens or other
encumbrances, Equity Interests in the Company possessing at least 50.01% of the total voting power
of the Equity Interest in the Company entitled to vote on a fully diluted basis and (ii) after the
completion of a Qualified Public Offering, any Unrelated Person or Unrelated Persons, acting
together, which would constitute a Group together with Affiliates and Related Persons thereof (in
each case also constituting Unrelated Persons) shall at any time either (1) Beneficially Own more
than 35% of the aggregate voting power of the Equity Interest in the Company entitled to vote on a
fully diluted basis and such percentage owned is greater than the percentage of the aggregate
voting power of the Equity Interest in the Company entitled to vote on a fully diluted basis then
owned by Ansary Related Parties, or (2) succeed in having a sufficient number of its or their
nominees elected to the board of directors/managers of the Company such that such nominees, when
added to any existing director remaining on such governing body of the Company after such election
who is an Affiliate or Related Person of such Person or Group, shall constitute a majority of the
governing body of the Company; (b) the Company shall cease to own, directly or indirectly, free and
clear of all Liens or other encumbrances (other than Liens created pursuant to a Loan Document),
100% of the outstanding Equity Interests of each Loan Party (other than the Company) on a fully
diluted basis; (c) occupation of a majority of the seats (other than vacant seats) on the board of
directors/managers of the Company by Persons who were neither (i) nominated by the board of
directors/managers of the Company nor (ii) appointed by directors/managers so nominated; (d) the
acquisition of direct or indirect Control of any Loan Party by any Person or group other than
Ansary Related Parties; or (e) so long as any of the Senior Notes are outstanding, any “Change of
Control”, “Fundamental Change” or other similar term described in the Senior Notes Indenture. As
used herein (1) “Beneficially Own” means “beneficially own” as defined in Rule 13d-3 and
13d-5 of the Securities Exchange Act of 1934, as amended, or any successor provision thereto; (2)
“Group” means a “group” for purposes of Section 13(d) of the Securities Exchange Act of
1934, as amended; (3) “Unrelated Person” means at any time any Person other than Ansary
Related Parties and the Company; and (4) “Related Person” of any Person means any other
Person owning (A) 10% or more of the outstanding Equity Interests of such Person or (B) 10% or more
of the voting power of the Equity Interest of such Person entitled to vote on a fully diluted
basis.

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

     “Chase” means JPMorgan Chase Bank, N.A., a national banking association, in its
individual capacity, and its successors.

10

 

     “Class”, when used in reference to any Loan or Borrowing, refers to whether such Loan,
or the Loans comprising such Borrowing, are Revolving Loans, Swingline Loans, Protective Advances
or Overadvances.

     “Closing Date Acquisition” means the acquisition by the Company of certain of the
assets of the Engineered Products Division and Power Products Division of Stewart & Stevenson
Services, Inc. and certain of its Affiliates, on or about January 25, 2006, pursuant to the
Acquisition Agreements and the other Acquisition Documents.

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

     “Collateral” means any and all property owned, leased or operated by a Person covered
by the Collateral Documents and any and all other property of any Loan Party, now existing or
hereafter acquired, that may at any time be or become subject to a security interest or Lien in
favor of Collateral Agent, on behalf of the Agents, the Lenders and the Other Secured Parties to
secure the Secured Obligations.

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

     “Collateral Agent” means JPMorgan Chase Bank, N.A., in its capacity as collateral
agent for the Lenders, and its successors and assigns in such capacity.

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

     “Collection Accounts” has the meaning assigned to such term in the Pledge and Security
Agreement.

     “Commitment” means, with respect to each Lender, the sum of such Lender’s Revolving
Commitment, together with the commitment of such Lender to acquire participations in Protective
Advances hereunder. The initial amount of each Lender’s Commitment is set forth on the Commitment
Schedule, or in the Assignment and Assumption pursuant to which such Lender shall have assumed its
Commitment, as applicable.

     “Commitment Increase Agreement” means a Commitment Increase Agreement entered into by
a Lender in accordance with Section 2.23 and accepted by the Administrative
Agent in the form of Exhibit F, or any other form approved by the
Administrative Agent.

     “Commitment Increase Notice” has the meaning assigned to such term in Section 2.23 hereof.

     “Commitment Reserves” means any and all reserves which the Administrative Agent deems
necessary, in its Permitted Discretion, to establish with respect to the maximum amount available
for borrowing under the Revolving Commitments and which will be deducted from the lower of the
Borrowing Base and the aggregate Revolving Commitments. Such Commitment Reserves include, without
limitation, reserves for accrued and unpaid interest on the

11

 

Obligations, reserves for Swap
Obligations, the Special Vendor Payable Reserve, the Rent Reserve, reserves for other charges at
consignee, warehouse and bailee locations and reserves for customs and shipping charges for
inventory in transit and reserves for taxes, fees, assessments, and other governmental charges;
provided, that Commitment Reserves shall not include any reserves specifically described under the
definition of “Borrowing Base Reserves”.

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

     “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.

     “Controlled Disbursement Account” means the following account: #709370605, and any
replacement or additional accounts of any of the Borrowers maintained with the Administrative Agent
as a zero balance, cash management account pursuant to and under any agreement between any of the
Borrowers and the Administrative Agent, as modified and amended from time to time, and through
which all disbursements of the Borrowers, any Loan Party and any designated Subsidiary of any
Borrower are made and settled on a daily basis with no uninvested balance remaining overnight.

     “Credit Exposure” means, as to any Lender at any time, the sum of (a) such Lender’s
Revolving Exposure at such time, plus (b) an amount equal to its Applicable Percentage, if any, of
the aggregate principal amount of Protective Advances outstanding at such time.

     “Current Financials” means, as of any day, the financial statements and other related
information for any applicable period most recently required to be delivered to the Administrative
Agent and the Lenders pursuant to Section 5.1(a), Section 5.1(b) and Section 5.1(c).

     “Dated Assets” has the meaning assigned to such term in Section 2.22(c) hereof.

     “Dated Liabilities” has the meaning assigned to such term in Section 2.22(c) hereof.

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

     “Detroit Diesel” means Detroit Diesel Corporation, MTU Detroit Diesel, Inc., MTU
Friedrichshafen GmbH, MTU DDC International GmbH, DDC MTU Americas Company L.L.C., DaimlerChrysler
AG, DaimlerChrysler Off-Highway Holding GmbH and their Affiliates.

     “Deutz” means Deutz Corporation and its Affiliates.

     “Dilution Factors” shall mean, without duplication, with respect to any period, the
aggregate amount of all deductions, credit memos, returns, adjustments, allowances, bad debt
write-offs and other non-cash credits which are recorded to reduce accounts receivable in a manner
consistent with current and historical accounting practices of the Borrowers.

12

 

     “Dilution Ratio” shall mean, at any date, the amount (expressed as a percentage) equal
to (a) the aggregate amount of the applicable Dilution Factors for the twelve (12) most recently
ended fiscal months divided by (b) total gross sales for the twelve (12) most recently ended fiscal
months.

     “Dilution Reserve” shall mean, at any date, the applicable Dilution Ratio multiplied
by the Eligible Accounts on such date.

     “Disclosed Matters” means the actions, suits and proceedings and the environmental
matters disclosed in Schedule 3.6.

     “Document” has the meaning assigned to such term in the Pledge and Security Agreement.

     “Dollars” or “$” refers to lawful money of the United States of America.

     “EBITDA” means, for any period, Net Income for such period plus (a) without
duplication and to the extent deducted in determining Net Income for such period, the sum of (i)
Interest Expense for such period, (ii) income tax expense for such period net of tax refunds, (iii)
all amounts attributable to depreciation and amortization expense for such period, (iv) all fees
and expenses incurred through, but not
following, January 25, 2006, in connection with the Closing Date Acquisition and the
Transactions and payable in cash to unrelated third parties (v) any extraordinary non-cash charges
for such period, (vi) any other non-cash charges for such period and (vii) fees and expenses
incurred in connection with a Permitted Acquisition and payable to unrelated third parties during
such period; provided that the aggregate amount of such fees and expenses added to EBITDA for all
periods pursuant to this clause (vii) shall not exceed $5,000,000, minus (b) without duplication
and to the extent included in Net Income, any extraordinary gains and any non-cash items of income
for such period, all calculated for the Company and its Subsidiaries on a consolidated basis in
accordance with GAAP but excluding from such calculation any results of operations of each Excluded
Subsidiary. For purposes of determining EBITDA for any period, if the Borrowers make one or more
Permitted Acquisitions during such period for aggregate consideration in excess of $15,000,000,
EBITDA will be determined on a pro forma basis (determined in a manner acceptable to the
Administrative Agent in its Permitted Discretion) giving effect to such Permitted Acquisition(s) as
if it/they had occurred on the first day of such period.

     “Effective Date” means the date on which the conditions specified in Section 4.1 are satisfied are satisfied
(or waived in accordance with Section 9.2).

     “Eligible Accounts” means, at any time, the Accounts of the Borrowers which the
Administrative Agent determines in its Permitted Discretion are eligible as the basis for the
extension of Revolving Loans, Swingline Loans and the issuance of Letters of Credit hereunder.
Without limiting the Administrative Agent’s discretion provided herein, Eligible Accounts shall not
include any Account:

     (a) which is not subject to a first priority perfected security interest in favor of the
Collateral Agent (subject to Permitted Senior Encumbrances);

13

 

     (b) which is subject to any Lien other than (i) a Lien in favor of the Collateral Agent and
(ii) Permitted Senior Encumbrances and other Permitted Encumbrances which other Permitted
Encumbrances do not have priority over the Lien in favor of the Collateral Agent;

     (c) with respect to which is unpaid more than 90 days after the date of the original invoice
therefor or more than 60 days after the original due date, or which has been written off the books
of a Borrower or otherwise designated as uncollectible;

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

     (e) which is owing by an Account Debtor other than any Account Debtor whose securities are
rated BBB or better by S&P or Baa3 or better by Moody’s to the extent the aggregate amount of
Accounts owing from such Account Debtor and its Affiliates to the Borrowers exceeds 15% of the
aggregate Eligible Accounts (to the extent of such excess);

     (f) with respect to which any covenant, representation, or warranty contained in this
Agreement or in the Security Agreement has been breached or is not true;

     (g) which (i) does not arise from the sale of goods or performance of services in the ordinary
course of business, (ii) is not evidenced by an invoice or other documentation satisfactory to the
Administrative Agent which has been sent to the Account Debtor, (iii) represents a progress
billing, (iv) is contingent upon a Borrower’s completion of any further performance, (v) represents
a sale on a bill-and-hold, guaranteed sale, sale-and-return, sale on approval, consignment,
cash-on-delivery or any other repurchase or return basis or (vi) relates to payments of interest;

     (h) for which the goods giving rise to such Account have not been shipped to the Account
Debtor or for which the services giving rise to such Account have not been performed by a Borrower
or if such Account was invoiced more than once (except to the extent such invoice was not redated
as of a date later than the original invoice date and such account is not otherwise compromised);

     (i) with respect to which any check or other instrument of payment has been returned
uncollected for any reason;

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

     (k) which is owed by any Account Debtor which has sold all or a substantially all of its
assets;

14

 

     (l) which is owed by an Account Debtor which (i) does not maintain its chief executive office
in the U.S. or Canada (other than the Province of Newfoundland) or (ii) is not organized under
applicable law of the U.S., any state of the U.S., Canada, or any province of Canada (other than
the Province of Newfoundland) unless, in either case, such Account is either (1) backed by a letter
of credit acceptable to the Administrative Agent which is in the possession of, has been assigned
to and is directly drawable by the Collateral Agent, (2) guaranteed by the Ex-Im Bank on terms
acceptable to the Administrative Agent, or (3) for such Accounts in an aggregate amount up to
$12,500,000 (or such greater amount as may be determined from time to time by the Administrative
Agent in its sole and absolute discretion), backed by credit insurance on terms and issued by a
provider acceptable to the Administrative Agent;

     (m) which is owed in any currency other than U.S. dollars;

     (n) which is owed by (i) the government (or any department, agency, public corporation, or
instrumentality thereof) of any country other than the U.S. unless such Account is backed by a
letter of credit acceptable to the Administrative Agent which is in the possession of the
Administrative Agent, or (ii) the government of the U.S., or any department, agency, public
corporation, or instrumentality thereof, unless the Federal Assignment of Claims Act of 1940, as
amended (31 U.S.C. § 3727 et seq. and 41 U.S.C. § 15 et seq.), and any other steps necessary to
perfect the Lien of the Collateral Agent in such Account have been complied with to the Collateral
Agent’s satisfaction;

     (o) which is owed by any Affiliate, employee, officer, director, agent or stockholder of any
Loan Party;

     (p) which, for any Account Debtor, exceeds a credit limit determined by the Administrative
Agent, to the extent of such excess;

     (q) which is owed by an Account Debtor or any Affiliate of such Account Debtor to which any
Loan Party is indebted, but, subject to clause (z) of this definition, only to the extent of such
indebtedness or is subject to any security, deposit, progress payment, retainage or other similar
advance made by or for the benefit of an Account Debtor, in each case to the extent thereof;

     (r) which is subject to any counterclaim, deduction, defense, setoff or dispute but only to
the extent of any such counterclaim, deduction, defense, setoff or dispute;

     (s) which is evidenced by any promissory note, chattel paper, or instrument, except for
Accounts arising out of the rental of equipment in the ordinary course of business and which are
evidenced by chattel paper;

     (t) which is owed by an Account Debtor located in any jurisdiction which requires filing of a
“Notice of Business Activities Report” or other similar report in order to permit a Borrower to
seek judicial enforcement in such jurisdiction of payment of such Account, unless such Borrower has
filed such report or qualified to do business in such jurisdiction;

     (u) with respect to which any Borrower has made any agreement with the Account Debtor for any
reduction thereof, other than discounts and adjustments given in the ordinary

15

 

course of business,
or any Account which was partially paid and such Borrower created a new receivable for the unpaid
portion of such Account;

     (v) which does not comply in all material respects with the requirements of all applicable
laws and regulations, whether Federal, state or local, including without limitation the Federal
Consumer Credit Protection Act, the Federal Truth in Lending Act and Regulation Z of the Board;

     (w) which is for goods that have been sold under a purchase order or pursuant to the terms of
a contract or other agreement or understanding (written or oral) that indicates or purports that
any Person other than the Borrowers have or have had an
ownership interest in such goods, or which indicates any party other than a Borrower as payee
or remittance party;

     (x) which the Administrative Agent determines in its Permitted Discretion may not be paid by
reason of the Account Debtor’s inability to pay or which the Administrative Agent otherwise
determines in its Permitted Discretion is unacceptable for any reason whatsoever; or

     (y) which is owed by any vendor or supplier to any Loan Party.

     In the event that an Account which was previously an Eligible Account ceases to be an Eligible
Account hereunder, the Borrowers shall notify the Administrative Agent thereof on and at the time
of submission to the Administrative Agent of the next Borrowing Base Certificate. In determining
the amount of an Eligible Account, the face amount of an Account shall be reduced by, without
duplication, to the extent not reflected in such face amount, (i) the amount of all accrued and
actual discounts, claims, credits or credits pending, promotional program allowances, price
adjustments, finance charges or other allowances (including any amount that the Borrowers may be
obligated to rebate to an Account Debtor pursuant to the terms of any agreement or understanding
(written or oral)) and (ii) the aggregate amount of all cash received in respect of such Account
but not yet applied by the Borrowers to reduce the amount of such Account. Standards of
eligibility may be changed from time to time solely by the Administrative Agent in the exercise of
its Permitted Discretion, with any such changes which are more restrictive to be effective three
(3) days after delivery of notice thereof to the Borrowers and the Lenders.

     “Eligible Equipment” means the equipment owned by a Borrower and meeting each of the
following requirements:

     (a) such Borrower has good title to such equipment;

     (b) such Borrower has the right to subject such equipment to a Lien in favor of the Collateral
Agent; such equipment is subject to a first priority perfected Lien in favor of the Collateral
Agent subject to Permitted Senior Encumbrances and is free and clear of all other Liens of any
nature whatsoever (except for Permitted Senior Encumbrances and other Permitted Encumbrances which
other Permitted Encumbrances do not have priority over the Lien in favor of the Collateral Agent);

     (c) the full purchase price for such equipment has been paid by such Borrower;

16

 

     (d) such equipment is located on premises (i) owned by a Borrower, which premises are subject
to a first priority perfected Lien in favor of the Collateral Agent, or (ii) leased by such
Borrower where (x) the lessor has delivered to the Collateral Agent a Collateral Access Agreement
or (y) a Rent Reserve with respect to such facility has been established by the Administrative
Agent in its Permitted Discretion;

     (e) such equipment is in good working order and condition (ordinary wear and tear excepted)
and is used or held for use by such Borrower in the ordinary course of business of such Borrower;

     (f) such equipment is not subject to any agreement which restricts the ability of such
Borrower to use, sell, transport or dispose of such equipment or which restricts the Collateral
Agent’s ability to take possession of, sell or otherwise dispose of such equipment;

     (g) such equipment does not constitute “fixtures” under the applicable laws of the
jurisdiction in which such equipment is located; and

     (h) with respect to which any covenant, representation, or warranty contained in this
Agreement or the Security Agreement has been breached or is not true and which does not conform to
all standards imposed by any Governmental Authority.

     “Eligible Inventory” means, at any time, the Inventory of the Borrowers which the
Administrative Agent determines in its Permitted Discretion is eligible as the basis for the
extension of Revolving Loans, Swingline Loans and the issuance of Letters of Credit hereunder.
Without limiting the Administrative Agent’s discretion provided herein, Eligible Inventory shall
not include any Inventory:

     (a) which is not subject to a first priority perfected Lien in favor of the Collateral Agent
subject to Permitted Senior Encumbrances;

     (b) which is subject to any Lien other than (i) a Lien in favor of the Collateral Agent and
(ii) Permitted Senior Encumbrances and other Permitted Encumbrances which other Permitted
Encumbrances do not have priority over the Lien in favor of the Collateral Agent;

     (c) which is, in the Administrative Agent’s opinion, obsolete, unmerchantable, defective,
used, unfit for sale, not salable at prices approximating at least the cost of such Inventory in
the ordinary course of business or unacceptable due to age, type, category and/or quantity;

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

     (e) in which any Person other than a Borrower shall (i) have any direct or indirect ownership,
interest or title to such Inventory or (ii) be indicated on any purchase order or invoice with
respect to such Inventory as having or purporting to have an interest therein;

17

 

     (f) which is not finished goods or which constitutes work-in-process (other than
work-in-process inventory expressly included in the definition of the term Borrowing Base), raw
materials, inactive, spare or, except as expressly included in the definition of the term Borrowing
Base, replacement parts, subassemblies, packaging and
shipping material, manufacturing supplies, samples, prototypes, displays or display items,
bill-and-hold goods, goods that are returned or marked for return, repossessed goods, defective or
damaged goods, goods held on consignment, or goods which are not of a type held for sale in the
ordinary course of business;

     (g) which is not located in the U.S. or is in transit with a common carrier from vendors and
suppliers;

     (h) which is located in any location leased by a Borrower unless (i) the lessor has delivered
to the Collateral Agent a Collateral Access Agreement or (ii) a Rent Reserve with respect to such
facility has been established by the Administrative Agent in its Permitted Discretion;

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

     (j) which is being processed offsite at a third party location or outside processor, or is
in-transit to or from said third party location or outside processor;

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

     (l) which is the subject of a consignment by a Borrower as consignor;

     (m) which is perishable;

     (n) which contains or bears any intellectual property rights licensed to a Borrower unless the
Collateral Agent is satisfied that it may sell or otherwise dispose of such Inventory without (i)
infringing the rights of such licensor, (ii) violating any contract with such licensor, or (iii)
incurring any liability with respect to payment of royalties other than royalties incurred pursuant
to sale of such Inventory under the current licensing agreement;

     (o) which is not reflected in a current perpetual inventory report of the Borrowers;

     (p) with respect to Inventory consisting of rental equipment or rolling stock, which (x) is
not in good working order and condition (ordinary wear and tear excepted), or (y) is subject to any
agreement (other than a short term rental agreement entered into in the ordinary course of the
Borrowers’ business) which restricts the ability of the Borrowers to use, sell, transport or
dispose of such equipment or which restricts the Collateral Agent’s ability to take possession of,
sell or otherwise dispose of such equipment; or

     (q) which the Administrative Agent otherwise determines in its Permitted Discretion is
unacceptable for any reason whatsoever.

18

 

     In the event that Inventory which was previously Eligible Inventory ceases to be Eligible
Inventory hereunder, the Borrowers shall notify the Administrative Agent thereof on and at the time
of submission to the Administrative Agent of the next Borrowing Base Certificate. Standards of
eligibility may change from time to time solely by the Administrative Agent in the exercise of its
Permitted Discretion, with any such changes which are more restrictive to be effective three (3)
days after delivery of notice thereof to the Borrowers and the Lenders.

     “Eligible Mortgaged Real Property” means the Real Property owned by a Borrower
described on Schedule 1.1 for which each of the following statements is accurate and
complete (and each Borrower by including such Real Property in the Fixed Asset Component of the
Borrowing Base shall be deemed to represent and warrant to the Agents, the Issuing Bank and each
Lender the accuracy and completeness of such statements):

     (a) such Borrower holds good and marketable title to the Real Property;

     (b) the Real Property is subject to a first priority perfected security interest in favor of
the Collateral Agent (subject to Permitted Senior Encumbrances) securing the Secured Obligations;
and

     (c) the Real Property is not subject to any Lien, except for Permitted Encumbrances and Liens
in favor of the Collateral Agent securing the Secured Obligations.

     “Engineered Products Division” means the operating divisions of the Borrowers engaged
in the design, manufacturing, service and sale of equipment for coiled tubing, acidizing,
fracturing, pumping (including nitrogen pumping equipment), railcar movers, seismic equipment
systems, silicon controlled rectifiers and switchgear equipment.

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

     “Environmental Liability” means any liability, contingent or otherwise (including any
liability for damages, costs of environmental remediation, fines, penalties or indemnities), of any
Borrower or any Subsidiary 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.

     “EPD Purchase Agreement” means that certain Asset Purchase Agreement dated as of
September 27, 2005 by and among Stewart & Stevenson Services, Inc., Stewart & Stevenson Petroleum
Services, Inc., Stewart & Stevenson International, Inc., Sierra Detroit Diesel Allison, Inc., and
S&S Trust and Hushang Ansary, as assigned to the Company and SSPP by that certain Assignment and
Assumption Agreement dated as of January 25, 2006, among Hushang Ansary,

19

 

the Company and SSPP
pursuant to which Hushang Ansary assigned his rights thereunder to the Company and SSPP.

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

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

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

     “ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of ERISA or
the regulations issued thereunder with respect to a Plan (other than an event for which the 30 day
notice period is waived); (b) the existence with respect to any Plan of an “accumulated funding
deficiency” (as defined in Section 412 of the Code or Section 302 of ERISA), whether or not waived;
(c) the filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an application
for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by any
Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to
the termination of any Plan; (e) the receipt by any Borrower or any ERISA Affiliate from the PBGC
or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to
appoint a trustee to administer any Plan; (f) the incurrence by any Borrower or any of its ERISA
Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by any Borrower or any ERISA Affiliate of any notice, or the
receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is,
or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.

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

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

     “Excess Cash Flow” means for any fiscal year, the excess, if any, of (a) EBITDA for
such fiscal year, over (b) the sum, without duplication, of the following, to the extent actually
paid in cash during such fiscal year: (i) scheduled principal payments on Indebtedness, including
the principal portion of scheduled payments under Capital Lease Obligations, (ii) Non-Financed
Capital Expenditures, (iii) Interest Expense, (iv) income tax expense, and (v) Restricted Payments
made pursuant to Section 6.8(a)(iv).

     “Excluded Subsidiary” means any Subsidiary of the Company which is not a Loan Party.
The Excluded Subsidiaries on the date hereof are Stewart & Stevenson Truck Holdings

20

 

LLC, Stewart & Stevenson de Venezuela, S.A., Transmissiones y Embragues, S.A., Stewart &
Stevenson de las Americas Colombia Ltda. Rio Grande Services, S de R.L. de C.V.

     “Excluded Taxes” means, with respect to the Administrative Agent, any Lender, the
Issuing Bank or any other recipient of any payment to be made by or on account of any obligation of
the Borrowers hereunder, (a) income or franchise taxes imposed on or measured by net income of, or
franchise taxes imposed on, the Administrative Agent, any Lender, the Issuing Bank or any other
recipient of any payment to be made by or on account of any obligation of the Borrowers by the
United States of America, or by any jurisdiction under the laws of which such recipient is
organized or in which its principal office is located, is subject to such taxation as a result of
doing business other than by reason of having executed, delivered, performed its obligations or
received a payment under, or enforced, this Agreement or another Loan Documents or, in the case of
any Lender, in which its applicable lending office is located, (b) any branch profits taxes imposed
by the United States of America or any similar tax imposed by any other jurisdiction in which a
Borrower is located and (c) in the case of a Foreign Lender (other than an assignee pursuant to a
request by the Borrowers under Section 2.19(b)), any withholding tax that is imposed on amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party to this Agreement
(or designates a new lending office) or is attributable to such Foreign Lender’s failure to comply
with Section 2.17(e), except to the extent that such Foreign Lender (or its assignor, if any) was
entitled, at the time of designation of a new lending office (or assignment), to receive additional
amounts from the Borrowers with respect to such withholding tax pursuant to Section 2.17(a).

     “Ex-Im Bank” means The Export-Import Bank of the United States and its successors and
assigns.

     “Existing Borrowers” shall have the meaning given such term in the recitals hereto.

     “Existing Credit Agreement” shall have the meaning given such term in the recitals
hereto.

     “Fee Letter” means one or more letter agreements regarding fees, executed by Chase
and/or certain of its Affiliates and accepted and agreed to by the Company as the same have been or
may hereafter be amended from time to time.

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

     “Financial Accommodation” has the meaning assigned to such term in Section 6.14.

21

 

     “Financial Officer” means the chief financial officer, principal accounting officer,
treasurer or controller of a Borrower. Unless otherwise specified, all references to a Financial
Officer herein shall mean a Financial Officer of all Borrowers.

     “Fixed Asset Collateral” means Collateral constituting Eligible Real Estate described
in Schedule 1.1, together with any fixtures thereon, and Eligible Equipment.

     “Fixed Asset Component” means $15,000,0000; provided that the Fixed Asset Component
shall be reduced by (a) the Monthly Fixed Asset Amortization Amount on the first day of each month
commencing with August 1, 2006 and continuing on the first day of each month thereafter throughout
the term of this Agreement and (b) the percentage of the appraised value (as of the Effective Date)
of any Fixed Asset Collateral which (i) is the subject of a casualty event (including, without
limitation, damage, destruction or condemnation) or a Permitted Fixed Asset Disposition, or (ii) is
no longer Eligible Equipment or Eligible Mortgaged Real Property, as applicable, less in each case
the portion of such amount that has already been reduced from the Fixed Asset Component as a result
of prior Monthly Fixed Asset Amortization Amount reductions, in each case such amounts being
determined by the Administrative Agent in its sole discretion.

     “Fixed Charges” means, with reference to any period, without duplication, cash
Interest Expense (including the interest component of Capital Lease Obligations), plus scheduled
principal payments on Indebtedness made during such period (including the principal component of
Capital Lease Obligations but which shall exclude mandatory prepayments made pursuant to Section
2.11(c)), plus dividends or distributions paid in cash during such period (other than dividends or
distributions paid from a Borrower or Subsidiary of a Borrower to a Borrower), all calculated for
the Borrowers and their Subsidiaries on a consolidated basis.

     “Fixed Charge Coverage Ratio” means, with reference to any period, the ratio of the
following calculated for such period: (a) EBITDA minus Non-Financed Capital Expenditures minus
income tax expenses paid in cash to (b) Fixed Charges, all calculated for the Borrowers and their
Subsidiaries other than any Excluded Subsidiary on a consolidated basis in accordance with GAAP.

     “Foreign Lender” means any Lender that is organized under the laws of a jurisdiction
other than that in which the Company is located. For purposes of this definition, the United
States of America, each State thereof and the District of Columbia shall be deemed to constitute a
single jurisdiction.

     “Funding Account” has the meaning assigned to such term in Section 4.1(i).

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

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

22

 

     “Guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation of any other Person (the “primary
obligor”) in any manner, whether directly or indirectly, and including any obligation of the
guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase
or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or lease property,
securities or services for the purpose of assuring the owner of such Indebtedness or other
obligation of the payment thereof, (c) to maintain working capital, equity capital or any other
financial statement condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or obligation;
provided, that the term Guarantee shall not include endorsements for collection or
deposit in the ordinary course of business.

     “Guaranteed Obligations” has the meaning assigned to such term in Section 10.1.

     “Hazardous Materials” means all explosive or radioactive substances or wastes,
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.

     “Hyster” means the Hyster Company, Hyster Credit Company and their Affiliates.

     “Indebtedness” of any Person means, without duplication, (a) all obligations of such
Person for borrowed money or with respect to deposits or advances of any kind, (b) all obligations
of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of
such Person upon which interest charges are customarily paid, (d) all obligations of such Person
under conditional sale or other title retention agreements relating to property acquired by such
Person, (e) all obligations of such Person in respect of the deferred purchase price of property or
services (excluding accounts payable incurred in the ordinary course of business and not more than
90 days overdue), (f) all Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property
owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed,
(g) all Guarantees by such Person of Indebtedness of others, (h) all Capital Lease Obligations of
such Person, (i) all reimbursement or similar obligations including interest thereon, contingent or
otherwise, of such Person as an account party in respect of letters of credit and letters of
guaranty, (j) all reimbursement or similar obligations including interest thereon, contingent or
otherwise, of such Person in respect of bankers’ acceptances, (k) obligations under any liquidated
earn-out and (l) any other Off-Balance Sheet Liability. The Indebtedness of any Person shall
include the Indebtedness of any other entity (including any partnership in which such Person is a
general partner) to the extent such Person is liable therefor as a result of such Person’s
ownership interest in or other relationship with such entity, except to the extent the terms of
such Indebtedness provide that such Person is not liable therefor.

     “Indemnified Taxes” means Taxes other than Excluded Taxes.

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     “Information Memorandum” means the Confidential Information Memorandum dated January
2006 relating to the Borrowers, the Closing Date Acquisition and the Transactions.

     “Interest Election Request” means a request by the Borrowers to convert or continue a
Borrowing in accordance with Section 2.7.

     “Interest Expense” means, with reference to any period, total cash interest expense
(including that attributable to Capital Lease Obligations) of the Borrowers and their Subsidiaries
for such period with respect to all outstanding Indebtedness of the Borrowers and their
Subsidiaries (including all commissions, discounts and other fees and charges owed with respect to
letters of credit and bankers’ acceptance financing and net costs under Swap Agreements in respect
of interest rates to the extent such net costs are allocable to such period in accordance with
GAAP), calculated on a consolidated basis for the Borrowers and their Subsidiaries for such period
in accordance with GAAP.

     “Interest Payment Date” means (a) with respect to any ABR Loan (other than a Swingline
Loan), the first day of each calendar month in arrears in respect of the previous calendar month,
the Maturity Date, (b) with respect to any Eurodollar Loan, the last day of the Interest Period
applicable to the Borrowing of which such Loan is a part and, in the case of a Eurodollar Borrowing
with an Interest Period of more than three months’ duration, each day prior to the last day of such
Interest Period that occurs at intervals of three months’ duration after the first day of such
Interest Period, the Maturity Date, and (c) with respect to any Swingline Loan, the day that such
Loan is required to be repaid and the Maturity Date.

     “Interest Period” means with respect to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing and ending on the numerically corresponding day in the
calendar month that is one, two, three or six months thereafter, as the Borrowers may elect;
provided, that (i) if any Interest Period would end on a day other than a Business
Day, such Interest Period shall be extended to the next succeeding Business Day unless such next
succeeding Business Day would fall in the next calendar month, in which case such Interest Period
shall end on the next preceding Business Day and (ii) any Interest Period pertaining to a
Eurodollar Borrowing that commences on the last Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the last calendar month of such Interest Period)
shall end on the last Business Day of the last calendar month of such Interest Period. For
purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is
made and thereafter shall be the effective date of the most recent conversion or continuation of
such Borrowing.

     “Inventory” has the meaning assigned to such term in the Pledge and Security
Agreement.

     “Issuing Bank” means Chase, in its capacity as the issuer of Letters of Credit
hereunder, and its successors in such capacity as provided in Section 2.6(i). The Issuing Bank
may, in its discretion, arrange for one or more Letters of Credit to be issued by Affiliates of the
Issuing Bank, in which case the term “Issuing Bank” shall include any such Affiliate with respect
to Letters of Credit issued by such Affiliate.

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     “Joinder Agreement” has the meaning assigned to such term in Section 5.12.

     “LC Disbursement” means a payment made by the Issuing Bank pursuant to a Letter of
Credit.

     “LC Exposure” means, at any time, the sum of (a) the aggregate undrawn amount of all
Letters of Credit outstanding at such time plus (b) the aggregate amount of all LC Disbursements
that have not yet been reimbursed by or on behalf of the Borrowers at such time. The LC Exposure
of any Revolving Lender at any time shall be its Applicable Percentage of the total LC Exposure at
such time.

     “LC Collateral Account” has the meaning assigned to such term in Section 2.6(j).

     “LC Shortfall Amount” means an amount equal to the difference of (x) the amount of LC
Exposure at such time, less (y) the amount on deposit in the LC Collateral Account at such time
which is free and clear of all rights and claims of third parties.

     “Lenders” means the Persons listed on the Commitment Schedule and any other Person
that shall have become a party hereto pursuant to an Assignment and Assumption, other than any such
Person that ceases to be a party hereto pursuant to an Assignment and Assumption. Unless the
context otherwise requires, the term “Lenders” includes the Swingline Lender.

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

     “Leverage Ratio” means, on any date, the ratio of (a) Total Indebtedness on such date
to (b) EBITDA for the period of four consecutive fiscal quarters ended on such date (or, if such
date is not the last day of a fiscal quarter, ended on the last day of the fiscal quarter most
recently ended prior to such date); provided that, for the purpose of calculating
the Leverage Ratio on August 5, 2006 and on November 4, 2006, all amounts relevant to the
calculation of EBITDA and the components thereof shall be Annualized amounts for the periods of two
and three fiscal quarters then ended, respectively.

     “LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period,
the rate appearing on Page 3750 of the Dow Jones Market Service (or on any successor or substitute
page of such Service, or any successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of interest rates
applicable to dollar deposits in the London interbank market) at approximately 11:00 a.m., London
time, two Business Days prior to the commencement of such Interest Period, as the rate for dollar
deposits with a maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the “LIBO Rate” with respect to such Eurodollar
Borrowing for such Interest Period shall be the rate (rounded upwards, if necessary, to the next
1/16 of 1%) at which dollar deposits of $5,000,000 and for a maturity comparable to such Interest
Period are offered by the principal London office of the Administrative Agent in immediately
available funds in the London interbank market at approximately 11:00 a.m., London time, two
Business Days prior to the commencement of such Interest Period.

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

     “Loan Documents” means this Agreement, any promissory notes issued pursuant to this
Agreement, any Letter of Credit applications, the Collateral Documents and all other agreements,
instruments, documents and certificates identified in Section 4.1 executed and delivered to, or in
favor of, any Agent or any Lenders and including all other pledges, powers of attorney, consents,
assignments, contracts, notices, letter of credit agreements and all other written matter whether
heretofore, now or hereafter executed by or on behalf of any Loan Party, or any employee of any
Loan Party, and delivered to any Agent or any Lender in connection with this Agreement or the
transactions contemplated thereby. Any reference in this Agreement or any other Loan Document to a
Loan Document shall include all appendices, exhibits or schedules thereto, and all amendments,
restatements, supplements or other modifications thereto, and shall refer to this Agreement or such
Loan Document as the same may be in effect at any and all times such reference becomes operative.

     “Loan Guarantor” means each Loan Party (other than the Borrowers and their foreign
Subsidiaries).

     “Loan Guaranty” means Article X of this Agreement.

     “Loan Parties” means the Company, the other Borrowers, the Borrowers’ domestic
Subsidiaries (other than Stewart & Stevenson Truck Holdings LLC) and any other Person who becomes a
party to this Agreement pursuant to a Joinder Agreement and their successors and assigns.

     “Loans” means the loans and advances made by the Lenders pursuant to this Agreement,
including Swingline Loans, Overadvances and Protective Advances.

     “Lock Box” has the meaning assigned to such term in the Pledge and Security Agreement.

     “Lock Box Agreement” has the meaning assigned to such term in the Pledge and Security
Agreement.

     “Material Adverse Effect” means a material adverse effect on (a) the business, assets,
operations, prospects or condition, financial or otherwise, of the Loan Parties taken as a whole,
(b) the ability of any Loan Party to perform any of its obligations under the Loan Documents to
which it is a party, (c) the Collateral, or the Collateral Agent’s Liens (on behalf of itself, the
Administrative Agent and the Lenders) on the Collateral or the priority of such Liens, or (d) the
rights of or benefits available to the Agents, the Issuing Bank or the Lenders thereunder.

     “Material Indebtedness” means Indebtedness (other than the Loans and Letters of
Credit) or obligations in respect of one or more Swap Agreements, of any one or more of the

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Borrowers and their Subsidiaries in an aggregate principal amount exceeding $10,000,000. For
purposes of determining Material Indebtedness, the “obligations” of any Borrower or any Subsidiary
in respect of any Swap Agreement at any time shall be the maximum aggregate amount (giving effect
to any netting agreements) that such Borrower or such Subsidiary would be required to pay if such
Swap Agreement were terminated at such time.

     “Maturity Date” means January 25, 2011 or any earlier date on which the Commitments
are reduced to zero or otherwise terminated pursuant to the terms hereof.

     “Maximum Liability” has the meaning assigned to such term in Section 10.10.

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

     “Monthly Fixed Asset Amortization Amount” means $178,571.43.

     “Mortgages” means any mortgage, deed of trust or other agreement which conveys or
evidences a Lien in favor of the Collateral Agent, for the benefit of the Agents, the Lenders and
the Other Secured Parties, on real property of a Loan Party, including any amendment, modification
or supplement thereto.

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

     “Net Income” means, for any period, the consolidated net income (or loss) of the
Borrowers and their Subsidiaries, determined on a consolidated basis in accordance with GAAP;
provided that there shall be excluded (a) the income (or deficit) of any Person
accrued prior to the date it becomes a Subsidiary of a Borrower or is merged into or consolidated
with a Borrower or any of its Subsidiaries, (b) the income (or deficit) of any Person (other than a
Subsidiary of a Borrower) in which a Borrower or any of its Subsidiaries has an ownership interest,
except to the extent that any such income is actually received by a Borrower or such Subsidiary in
the form of dividends or similar distributions and (c) the undistributed earnings of any Subsidiary
of any Borrower (other than another Borrower or a Loan Guarantor) to the extent that the
declaration or payment of dividends or similar distributions by such Subsidiary is not at the time
permitted by the terms of any contractual obligation (other than under any Loan Document) or
Requirement of Law applicable to such Subsidiary.

     “Net Orderly Liquidation Value” means, with respect to Inventory, including, without
limitation, Eligible Inventory consisting of rental equipment and rolling stock, of any Person, the
orderly liquidation value thereof as determined in a manner acceptable to the Administrative Agent
by an appraiser acceptable to the Administrative Agent, net of all costs of liquidation thereof.

     “Net Proceeds” means, with respect to any event, (a) the cash proceeds received in
respect of such event including (i) any cash received in respect of any non-cash proceeds
(including any cash payments received by way of deferred payment of principal pursuant to a note or
installment receivable or purchase price adjustment receivable or otherwise, but excluding any
interest payments), but only as and when received, (ii) in the case of a casualty, insurance
proceeds and (iii) in the case of a condemnation or similar event, condemnation

27

 

awards and similar payments, net of (b) the sum of (i) all reasonable fees and out-of-pocket expenses paid to third
parties (other than Affiliates) in connection with such event, (ii) in the case of a sale, transfer
or other disposition of an asset (including pursuant to a sale and leaseback transaction or a
casualty or a condemnation or similar proceeding), the amount of all payments required to be made
as a result of such event to repay Indebtedness (other than Loans) secured by such asset or
otherwise subject to mandatory prepayment as a result of such event and (iii) the amount of all
taxes paid (or reasonably estimated to be payable) and the amount of any reserves established to
fund contingent liabilities reasonably estimated to be payable, in each case during the year that
such event occurred or the next succeeding year and that are directly attributable to such event
(as determined reasonably and in good faith by a Financial Officer).

     “New Lender” has the meaning assigned to such term in Section 2.23.

     “New Lender Agreement” means a New Lender Agreement entered into by a New Lender in
accordance with Section 2.23 and accepted by the Administrative Agent in the form of Exhibit
G, or any other form approved by the Administrative Agent.

     “Non-Consenting Lender” has the meaning assigned to such term in Section 9.2(d).

     “Non-Financed Capital Expenditures” means Capital Expenditures made by any Loan Party
which are not financed pursuant to the incurrence of Indebtedness, the issuance of Equity Interests
or receipt of an equity contribution, a Capitalized Lease Obligation or a Loan.

     “Non-Paying Guarantor” has the meaning assigned to such term in Section 10.11.

     “non SSPP Borrowings” has the meaning assigned to such term in Section 6.14.

     “Obligated Party” has the meaning assigned to such term in Section 10.2.

     “Obligations” means all unpaid principal of and accrued and unpaid interest on the
Loans, all LC Exposure, all accrued and unpaid fees and all expenses, reimbursements, indemnities
and other obligations of the Loan Parties to the Lenders or to any Lender, the Agents, the Issuing
Bank or any indemnified party arising under the Loan Documents.

     “Off-Balance Sheet Liability” of a Person means (a) any repurchase obligation or
liability of such Person with respect to accounts or notes receivable sold by such Person, (b) any
indebtedness, liability or obligation under any so-called “synthetic lease” transaction entered
into by such Person, or (c) any indebtedness, liability or obligation arising with respect to any
other transaction which is the functional equivalent of or takes the place of borrowing but which
does not constitute a liability on the balance sheets of such Person (other than operating leases
and Capital Lease Obligations).

     “Other Secured Parties” means all of the Lenders and the Affiliates of the Lenders to
whom Banking Service Obligations and/or Swap Obligations are owed.

     “Other Taxes” means any and all present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies arising from any payment made

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hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement.

     “Overadvance” has the meaning assigned to such term in Section 2.5(d).

     “Participant” has the meaning set forth in Section 9.4.

     “Paying Guarantor” has the meaning assigned to such term in Section 10.11.

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

     “Perfection Certificate” shall mean that certain Perfection Certificate dated January
25, 2006, executed by each Borrower and addressed to the Collateral Agent.

     “Perfection Certificate Update” shall mean a Certificate from a Responsible Officer of
the Borrowers in the form of Exhibit H hereto to be delivered to the Collateral Agent monthly
pursuant to Section 5.1(q) hereof and setting forth all changes that would be required to be made
to the Perfection Certificates (as updated pursuant to any prior Perfection Certificate Updates) to
cause the Perfection Certificates to be accurate and complete if reissued as of the last day of the
month immediately preceding the month in which the Perfection Certificate is required to be
delivered pursuant to Section 5.1(q) hereof.

     “Permitted Acquisition” means any Acquisition by any Loan Party in a transaction that
satisfies each of the following requirements:

     (a) such Acquisition is not a hostile or contested acquisition;

     (b) the business acquired in connection with such Acquisition is not engaged, directly or
indirectly, in any line of business other than the businesses in which the Loan Parties are engaged
on the date of this Agreement and any business activities that are substantially similar, related,
or incidental thereto;

     (c) both before and after giving effect to such Acquisition and the Loans (if any) requested
to be made in connection therewith, each of the representations and warranties in the Loan
Documents is true and correct (except (i) any such representation or warranty which relates to a
specified prior date and (ii) to the extent the Administrative Agent and the Lenders have been
notified in writing by the Loan Parties that any representation or warranty is not correct and the
Required Lenders have explicitly waived in writing compliance with such representation or warranty)
and no Default or Event of Default exists, will exist, or would result therefrom;

     (d) as soon as available, but in any event adequately prior to such Acquisition in order to
allow the Administrative Agent time to review the information provided to the Lenders under clause
(ii) below, for Acquisitions with a purchase price greater than $5,000,000, the Borrowers shall
provide, the Lenders (i) notice of such Acquisition and (ii) a copy of all business and financial
information reasonably requested by the Administrative Agent including pro forma financial
statements, statements of cash flow, and Availability projections;

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     (e) if the Accounts and Inventory acquired in connection with such Acquisition are proposed to
be included in the determination of the Borrowing Base, the Administrative Agent shall have
conducted an audit and field examination of such Accounts and Inventory to its satisfaction, and
all appropriate Lien filings and collateral documentation, including Collateral Access Agreements,
have been duly completed, executed and delivered to the Administrative Agent;

     (f) the purchase price of any acquisition of a business not located in the United States or of
a Person not organized in the United States or any State thereof shall not exceed (x) $5,000,000,
and (y) for all such Acquisitions in any fiscal year of the Borrowers shall not exceed (y)
$10,000,000;

     (g) if such Acquisition is an acquisition of the Equity Interests of a Person, the Acquisition
is structured so that the acquired Person shall become a wholly-owned Subsidiary of a Borrower and,
to the extent required by Section 5.14, a Loan Party pursuant to the terms of this Agreement;

     (h) if such Acquisition is an acquisition of assets located primarily in the United States,
the Acquisition is structured so that a Borrower shall acquire such assets;

     (i) if such Acquisition is an acquisition of Equity Interests, such Acquisition will not
result in any violation of Regulation U;

     (j) no Loan Party shall, as a result of or in connection with any such Acquisition, assume or
incur any direct or contingent liabilities (whether relating to environmental, tax, litigation, or
other matters) that could have a Material Adverse Effect;

     (k) in connection with an Acquisition of the Equity Interests of any Person, all Liens on
property of such Person shall be terminated unless permitted pursuant to Section 6.2(e), or the
Administrative Agent in its sole discretion consents otherwise, and in connection with an
Acquisition of the assets of any Person, all Liens on such assets shall be terminated;

     (l) the Fixed Charge Coverage Ratio for the Borrowers (after giving effect to such
Acquisition) shall be greater than 1.25 to 1.00 for the most recently completed twelve month period
assuming that for purposes of calculating the Fixed Charge Coverage Ratio for such period
(calculated on a pro forma basis in a manner acceptable to the Administrative Agent) such
Acquisition occurred on the first day of such applicable period;

     (m) Each Borrower shall certify (and provide the Administrative Agent with pro forma and
projected calculations in form and substance reasonably satisfactory to the Administrative Agent),
on its behalf and on behalf of the other Borrowers, to the Administrative Agent and the Lenders
that, immediately after giving effect to the completion of such Acquisition and for next succeeding
twelve month period, Availability will not be less than $30,000,000 on a pro forma basis (assuming
all past due accounts payable of the Borrowers have been paid in full in cash and no accounts
payable of the Borrowers are allowed to become past due during such twelve month period thereafter)
which includes all consideration given in connection with such Acquisition, other than Equity
Interests of the Company delivered to the

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seller(s) in such Acquisition, as having been paid in cash at the time of making such
Acquisition; and

     (n) no Default or Event of Default exists or would result therefrom.

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

     “Permitted Encumbrances” means:

     (a) Liens imposed by law for taxes that are not yet due or are being contested in compliance
with Section 5.4;

     (b) carriers’, warehousemen’s, landlords’, mechanics’, materialmen’s, vendors’, repairmen’s
and other like Liens imposed by law, arising in the ordinary course of business and securing
obligations that are not overdue by more than 30 days or are being contested in compliance with
Section 5.4;

     (c) (i) pledges and deposits made in the ordinary course of business in compliance with
workers’ compensation, unemployment insurance and other social security laws or regulations and
(ii) pledges and deposits securing liability for reimbursement or indemnification obligations of
(including obligations in respect of letters of credit, bank guarantees or similar instruments for
the benefit of) insurance carriers providing property, casualty or liability insurance to any Loan
Party;

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

     (e) judgment liens in respect of judgments that do not constitute an Event of Default under
clause (k) of Article VII;

     (f) easements, zoning restrictions, rights-of-way, restrictive covenants, encroachments,
protrusions and similar encumbrances on real property imposed by law or arising in the ordinary
course of business that do not secure any monetary obligations and do not materially detract from
the value of the affected property or interfere with the ordinary conduct of business of the
Borrower or any Subsidiary including without limitation any defects and encumbrances noted and
disclosed in a mortgage’s title insurance policy issued in favor of and delivered to the Collateral
Agent in connection with any Mortgage and any state of facts disclosed on any survey referenced in
any such title policy and any replacement, extension or renewal of any such Lien; provided that
such replacement, extension or renewal Lien shall not cover any property other than the property
that was subject to such Lien prior to such replacement, extension or renewal; provided further
that the Indebtedness and other obligations secured by such replacement, extension or renewal Lien
are permitted by this Agreement;

     (g) any interest of a consignor in goods held by any Loan Party on consignment provided that
such goods are held on consignment in the ordinary course of business and in compliance with this
Agreement;

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     (h) any leasehold interest or title of a lessor or sublessor under any leases or subleases
entered into by any Loan Party in the ordinary course of business and in compliance with this
Agreement;

     (i) Liens that are contractual rights of set-off (i) relating to the establishment of
depository relations with banks not given in connection with the issuance of Indebtedness, or (ii)
relating to purchase orders and other agreements entered into with customers in the ordinary course
of business and in compliance with this Agreement;

     (j) licenses or sublicenses of intellectual property granted by any Loan Party in the ordinary
course of business and in compliance with this Agreement;

     (k) Liens solely on any cash earnest money deposits made by any Loan Party or any of their
Subsidiaries in connection with any letter of intent or purchase agreement with respect to the
purchase of assets or property by a Loan Party which is permitted hereunder;

     (m) Liens arising from precautionary UCC financing statements regarding operating leases; and

     (n) Liens in favor of Deutz, Hyster and Detroit Diesel encumbering inventory and equipment
(and the proceeds thereof) purchased by Borrowers from Deutz, Hyster and Detroit Diesel;

provided that the term “Permitted Encumbrances” shall not include any Lien
securing Indebtedness.

     “Permitted Investments” means:

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

     (b) investments in commercial paper maturing within 360 days from the date of acquisition
thereof and having, at such date of acquisition, the highest credit rating obtainable from S&P or
from Moody’s;

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

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

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     (e) shares of mutual funds whose investment guidelines restrict substantially all of such
funds’ investments in securities of the types described in clauses (a) through (d) above; and

     (f) money market funds that (i) comply with the criteria set forth in Securities and Exchange
Commission Rule 2a-7 under the Investment Company Act of 1940, (ii) are rated AAA by S&P and Aaa by
Moody’s and (iii) have portfolio assets of at least $5,000,000,000.

     “Permitted Fixed Asset Disposition” means sales, assignments, leases, licenses,
transfers, exchanges or other dispositions of or the pledge or grant of a security interest in (a)
any Real Property described on Schedule 1.1 together with any fixtures thereon resulting in
Net Proceeds to a Borrower in an amount greater than or equal to the corresponding amount set forth
on such schedule, or (b) any Equipment of the Borrowers, in each case to the extent permitted under
Section 6.5.

     “Permitted Senior Encumbrances” means (a) Liens described in clauses (a) and (b) of
the definition of “Permitted Encumbrances” in each case securing amounts which are not past due,
and (b) Liens in favor of Deutz, Hyster and Detroit Diesel encumbering inventory and equipment (and
the proceeds thereof) purchased by Borrowers from Deutz, Hyster and Detroit Diesel.

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

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

     “Pledge and Security Agreement” means that certain Amended and Restated Pledge and
Security Agreement, dated as of the date hereof, between the Loan Parties and the Collateral Agent,
for the benefit of itself, the Administrative Agent, the Lenders and the Other Secured Parties, as
the same may be amended, restated or otherwise modified from time to time.

     “Power Products Division” means the operating divisions of the Borrowers engaged in
the sale and rental of various industrial equipment; sale of components, replacement parts,
accessories and other materials supplied by independent manufacturers; provision of in-shop and
on-site repair services for industrial, transportation, marine, construction, power generation and
material handling equipment; fabrication, marketing and packaging of engine-driven equipment.

     “PPD Purchase Agreement” means that certain Asset Purchase Agreement dated as of
October 24, 2005 by and among Stewart & Stevenson Services, Inc., IPSC Co. Inc., Stewart &
Stevenson Holdings, Inc., Stewart & Stevenson De Las Americas, Inc., Stewart & Stevenson
International, Inc., Stewart & Stevenson Power, Inc. and S&S Trust and Hushang Ansary, as amended
by that certain Assignment and Assumption Agreement dated as of January 25, 2006, among Hushang
Ansary, the Company and SSPP pursuant to which Hushang Ansary assigned his rights thereunder to the
Company and SSPP.

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     “Prepayment Event” means:

     (a) any sale, transfer or other disposition (including pursuant to a sale and leaseback
transaction) of any property or asset of any Loan Party, other than dispositions described in
Section 6.5(a), (b), (c), (d) or (f) to the extent excluded in clause (b) below) and other than
such sales, transfers or other dispositions resulting in no more than $1,000,000 in Net Proceeds
per event and less than $2,000,000 in Net Proceeds in any four consecutive fiscal quarters of the
Company); or

     (b) any casualty or other insured damage to, or any taking under power of eminent domain or by
condemnation or similar proceeding of, any property or asset of any Loan Party with a fair value
immediately prior to such event equal to or greater than $1,000,000; or

     (c) the incurrence by any Loan Party of any Indebtedness, other than Indebtedness permitted
under Section 6.1.

     “Prime Rate” means the rate of interest per annum publicly announced from time to time
by Chase or its parent as its prime rate (which is not necessarily the lowest rate charged to any
customer); each change in the Prime Rate shall be effective from and including the date such change
is publicly announced as being effective.

     “Proceeds” has the meaning assigned to such term in the Pledge and Security Agreement.

     “Projections” has the meaning assigned to such term in Section 5.1(f).

     “Protective Advance” has the meaning assigned to such term in Section 2.4.

     “Qualified Public Offering” means the first underwritten public offering pursuant to
an effective registration statement under the Securities Act of 1933, as amended, covering the
offer and sale of Equity Interests of the Company on a firm commitment basis in which the aggregate
Net Proceeds received by the Company at the public offering price is at least $75,000,000.

     “Real Property” shall mean any right, title or interest in and to real property,
including any fee interest, leasehold interest, easement, or license and any other right to use or
occupy real property, including any right arising by contract.

     “Register” has the meaning set forth in Section 9.4.

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

     “Rent Reserve” means a reserve equal to four (4) months of rental obligations for each
parcel of Real Property leased by a Borrower at which Eligible Inventory is located and, with
respect to any store, warehouse distribution center, regional distribution center or depot where
any Inventory subject to Liens arising by operation of law is located, a reserve equal to four (4)
months’ rent at such store, warehouse distribution center, regional distribution center or depot,
in

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each case with respect to which the applicable landlord, warehouseman or bailee has not
provided a Collateral Access Agreement.

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

     “Required Lenders” means, at any time, Lenders having Credit Exposure and unused
Commitments representing more than 50% of the sum of the total Credit Exposure and unused
Commitments at such time. In addition to the foregoing, so long as there are two or more Lenders
party to this Agreement, Required Lenders must include at least two Lenders.

     “Requirement of Law” means, as to any Person, the Certificate of Incorporation and By
Laws or other organizational or governing documents of such Person, and any law, treaty, rule or
regulation or determination of an arbitrator or a court or other Governmental Authority, in each
case applicable to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.

     “Reserves” means the Borrowing Base Reserves and the Commitment Reserves,
collectively.

     “Responsible Officer” means, with respect to any limited liability company or
corporation, the chairman of the board, the president, any vice president, the chief executive
officer or the chief operating officer, or any equivalent officer (regardless of his or her title),
and, in respect of financial or accounting matters, a Financial Officer. Unless otherwise
specified, all references to a Responsible Officer herein shall mean a Responsible Officer of all
Borrowers.

     “Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests in any 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 Equity Interests in any Borrower or any option, warrant or
other right to acquire any such Equity Interests in any Borrower.

     “Revolving Commitment” means, with respect to each Lender, the commitment, if any, of
such Lender to make Revolving Loans and to acquire participations in Letters of Credit,
Overadvances and Swingline Loans hereunder, expressed as an amount representing the maximum
possible aggregate amount of such Lender’s Revolving Exposure hereunder, as such commitment may be
(a) reduced from time to time pursuant to Section 2.9, (b) reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 9.4, and (c) increased from time
to time pursuant to Section 2.23. The initial amount of each Lender’s Revolving Commitment is
set forth on the Commitment Schedule, or in the Assignment and Assumption pursuant to which such
Lender shall have assumed its Revolving Commitment, as applicable. The initial aggregate amount of
the Lenders’ Revolving Commitments is $125,000,000.

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     “Revolving Exposure” means, with respect to any Lender at any time, the sum of (a) the
outstanding principal amount of such Lender’s Revolving Loans and its LC Exposure at such time,
plus (b) an amount equal to its Applicable Percentage of the aggregate principal amount of
Swingline Loans at such time, plus (c) an amount equal to its Applicable Percentage of the
aggregate principal amount of Overadvances outstanding at such time.

     “Revolving Lender” means, as of any date of determination, a Lender with a Revolving
Commitment or, if the Revolving Commitments have terminated or expired, a Lender with Revolving
Exposure.

     “Revolving Loan” means a Loan made pursuant to Section 2.1.

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

     “Secured Obligations” means (a) all Obligations, (b) all Banking Services Obligations
and (c) Swap Obligations owing to one or more Lenders or their respective Affiliates;
provided that at or prior to the time that any transaction relating to such Swap
Obligation is executed, the Lender party thereto (other than Chase) shall have delivered written
notice to the Administrative Agent that such a transaction has been entered into and that it
constitutes a Secured Obligation entitled to the benefits of the Collateral Documents.

     “Security Agreement” means the Pledge and Security Agreement and any other pledge or
security agreement entered into, after the date of this Agreement by any other Loan Party (as
required by this Agreement or any other Loan Document), or any other Person, as the same may be
amended, restated or otherwise modified from time to time.

     “Senior Notes” means the 10% Senior Unsecured Notes due 2014 to be issued by the
Company on the Effective Date in the aggregate principal amount of $150,000,000 having the terms
set forth in the Senior Notes Indenture.

     “Senior Notes Documents” means the Senior Notes, the Senior Notes Indenture, and each
other material document, instrument or agreement to which the Company or any of its Subsidiaries is
or may hereafter become a party pertaining to the Senior Notes.

     “Senior Notes Indenture” means the Indenture dated July 6, 2006, by and between the
Company and Wells Fargo Bank, National Association as Trustee setting forth certain terms and
conditions of certain of the Senior Notes.

     “Senior Notes Offering” means the offering by the Company and SSC, as co-issuers of
the Senior Notes pursuant to the terms and conditions of the Offering Memorandum.

     “Senior Notes Offering Memorandum” means the Offering Memorandum dated June 29, 2006
setting forth the terms and conditions of the Senior Notes Offering.

     “Settlement” has the meaning assigned to such term in Section 2.5(d).

     “Settlement Date” has the meaning assigned to such term in Section 2.5(d).

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     “Special Vendor Payable Reserve” means a reserve established by Administrative Agent
in its Permitted Discretion in an amount equal to the accounts payable owed by Borrowers to Deutz,
Hyster and Detroit Diesel less (calculated separately for each such vendor) the amount of accounts
owed by each such vendor to a Borrower in respect of warranty work performed by such Borrower and
which are not more than sixty (60) days past the original invoice date.

     “SSA” shall have the meaning set forth in the initial paragraph hereof.

     “SSC” shall have the meaning set forth in the initial paragraph hereof.

     “SSDH” shall have the meaning set forth in the initial paragraph hereof.

     “SSPP” shall have the meaning set forth in the initial paragraph hereof.

     “SSPS” shall have the meaning set forth in the initial paragraph hereof.

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

     “Subject Borrower” has the meaning assigned to such term in Section 2.22(b) hereof.

     “Subordinated Indebtedness” of a Person means any Indebtedness of such Person the
payment of which is subordinated in writing to payment of the Secured Obligations to the
satisfaction of the Administrative Agent.

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

     “Subsidiary” means any subsidiary of the Company or a Loan Party, as applicable.

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     “Supermajority Revolving Lenders” means, at any time, Lenders having Revolving
Exposure and unused Revolving Commitments representing 66 2/3% or more of the sum of the total
Revolving Exposure and unused Revolving Commitment.

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

     “Swap Obligations” of a Person means any and all obligations of such Person, whether
absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired
(including all renewals, extensions and modifications thereof and substitutions therefor), under
(a) any and all Swap Agreements, and (b) any and all cancellations, buy backs, reversals,
terminations or assignments of any Swap Agreement transaction.

     “Swingline Lender” means JPMorgan Chase Bank, N.A., in its capacity as lender of
Swingline Loans hereunder.

     “Swingline Loan” means a Loan made pursuant to Section 2.5.

     “Syndication Agent” means The CIT Group/Business Credit, Inc., in its capacity as
syndication agent for the Lenders hereunder, and its successors and assigns in such capacity.

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

     “Total Indebtedness” means, at any date, the aggregate principal amount of all
Indebtedness of the Borrowers and their Subsidiaries for borrowed money at such date, determined on
a consolidated basis in accordance with GAAP.

     “Transactions” means the execution, delivery and performance by the Borrowers of this
Agreement, the borrowing of Loans and other credit extensions, the use of the proceeds thereof and
the issuance of Letters of Credit hereunder.

     “True-Up Loans” shall have the meaning given such term in the recitals hereto.

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

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

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

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

     Section 1.2 Classification of Loans and Borrowings. For purposes of this Agreement, Loans may be
classified and referred to by Class (e.g., a “Revolving Loan”) or by Type (e.g., a
“Eurodollar Loan”) or by Class and Type (e.g., a “Eurodollar Revolving
Loan”). Borrowings also may be classified and referred
to by Class (e.g., a
“Revolving Loan Borrowing”) or by Type (e.g., a “Eurodollar Borrowing”) or
by Class and Type (e.g., a “Eurodollar Revolving Loan Borrowing”).

     Section 1.3 Terms Generally. The definitions of terms herein shall apply equally to the singular and
plural forms of the terms defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The words “include”, “includes” and
“including” shall be deemed to be followed by the phrase “without limitation”. The word “will”
shall be construed to have the same meaning and effect as the word “shall”. Unless the context
requires otherwise (a) any definition of or reference to any agreement, instrument or other
document herein shall be construed as referring to such agreement, instrument or other document as
from time to time amended, supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference herein to any Person
shall be construed to include such Person’s successors and assigns, (c) the words “herein”,
“hereof” and “hereunder”, and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all references herein to
Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of,
and Exhibits and Schedules to, this Agreement and (e) the words “asset” and
“property” shall be construed to have the same meaning and effect and to refer to any and
all tangible and intangible assets and properties, including cash, securities, accounts and
contract rights.

     Section 1.4 Accounting Terms; GAAP. Except as otherwise expressly provided herein, all terms of an
accounting or financial nature shall be construed in accordance with GAAP, as in effect from time
to time; provided that, if the Borrowers notify the Administrative Agent that the
Borrowers request an amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the operation of such
provision (or if the Administrative Agent notifies the Borrowers that the Required Lenders request
an amendment to any provision hereof for such purpose), regardless of whether any such notice is
given before or after such change in GAAP or in the application thereof, then such provision shall
be interpreted on the basis of GAAP as in effect and applied immediately before such change shall
have become effective until such notice shall have been withdrawn or such provision amended in
accordance herewith.

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ARTICLE II

THE CREDITS

     Section 2.1 Commitments. Subject to the terms and conditions set forth herein, each Lender agrees to
make Revolving Loans to the Borrowers from time to time during the Availability Period in an
aggregate principal amount that will not result in (i) such Lender’s Revolving Exposure exceeding
such Lender’s Revolving Commitment or (ii) the total Revolving Exposures exceeding (x) the lesser
of (A) the total Revolving Commitments and (B) the Borrowing Base, minus (y) the Commitment
Reserves, subject to the Administrative Agent’s authority, in its sole discretion, to make
Protective Advances and Overadvances pursuant to the terms of Section 2.4 and Section 2.5.
Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrowers
may borrow, prepay and reborrow Revolving Loans.

     Section 2.2 Loans and Borrowings.

          (a) Each Loan (other than a Swingline Loan) shall be made as part of a Borrowing consisting of
Loans of the same Class and Type made by the Lenders ratably in accordance with their respective
Commitments of the applicable Class. Any Protective Advance, any Overadvance and any Swingline
Loan shall be made in accordance with the procedures set forth in Section 2.4 and Section 2.5.

          (b) Subject to Section 2.14, each Borrowing shall be comprised entirely of ABR Loans or
Eurodollar Loans as the Borrowers may request in accordance herewith, provided that
all Borrowings made on the Effective Date must be made as ABR Borrowings but may be converted into
Eurodollar Borrowings in accordance with Section 2.8. Each Swingline Loan shall be an ABR Loan.
Each Lender at its option may make any Eurodollar Loan by causing any domestic or foreign branch or
Affiliate of such Lender to make such Loan; provided that any exercise of such
option shall not affect the obligation of the Borrowers to repay such Loan in accordance with the
terms of this Agreement.

          (c) At the time that any ABR Borrowing of Revolving Loans is made, such Borrowing shall be in
an aggregate amount that is an integral multiple of $1,000,000 and not less than $1,000,000;
provided that such an ABR Borrowing may be in an aggregate amount (i) in the case
of a Revolving Loan Borrowing, that is equal to the entire unused balance of the total Revolving
Commitments, or (ii) that is required to finance the reimbursement of an LC Disbursement as
contemplated by Section 2.6(e). At the time that each Eurodollar Borrowing of Revolving Loans is
made, any such Borrowing shall be in an aggregate amount that is an integral multiple of $1,000,000
and not less than $1,000,000. Each Swingline Loan shall be in an amount that is an integral
multiple of $250,000 and not less than $250,000. Borrowings of more than one Type and Class may be
outstanding at the same time; provided that there shall not at any time be more
than a total of fifteen (15) Eurodollar Borrowings outstanding.

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

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     Section 2.3 Requests for Borrowings. To request a Revolving Loan Borrowing, the Borrowers shall notify
the Administrative Agent of such request either in writing (delivered by hand or facsimile) in a
form approved by the Administrative Agent and signed by the Borrowers (a) in the case of a
Eurodollar Borrowing, not later than 10:00 a.m., Chicago time, three Business Days before the date
of the proposed Borrowing or (b) in the case of an ABR Borrowing, not later than 10:00 a.m.,
Chicago time, on the date of the proposed Borrowing; provided that any such notice
of an ABR Revolving Loan Borrowing to finance the reimbursement of an LC Disbursement as
contemplated by Section 2.6(e) may be given not later than 9:00 a.m., Chicago time, on the date of
the proposed Borrowing. Each such Borrowing Request shall specify the following information in
compliance with Section 2.1:

          (i) the aggregate amount of the requested Borrowing and a breakdown of the separate
wires comprising such Borrowing;

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

          (iii) whether such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing; and

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

If no election as to the Type of Revolving Loan Borrowing is specified, then the requested
Revolving Loan Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested Eurodollar Borrowing, then the Borrowers shall be deemed to have selected
an Interest Period of one month’s duration. Promptly following receipt of a Borrowing Request in
accordance with this Section, the Administrative Agent shall advise each Lender of the details
thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing.

     Section 2.4 Protective Advances.

          (a) Subject to the limitations set forth below, the Administrative Agent is authorized by the
Borrowers and the Lenders, from time to time in the Administrative Agent’s sole discretion (but
shall have absolutely no obligation), to make Loans to the Borrowers, on behalf of all Lenders,
which the Administrative Agent, in its Permitted Discretion, deems necessary or desirable (i) to
preserve or protect the Collateral, or any portion thereof, (ii) to enhance the likelihood of, or
maximize the amount of, repayment of the Loans and other Obligations, or (iii) to pay any other
amount chargeable to or required to be paid by the Borrowers pursuant to the terms of this
Agreement, including payments of reimbursable expenses (including costs, fees, and expenses as
described in Section 9.3) and other sums payable under the Loan Documents (any of such Loans are
herein referred to as “Protective Advances”); provided that, the aggregate
amount of Protective Advances outstanding at any time shall not at any time exceed $15,000,000;
provided further that, the aggregate amount of outstanding Protective
Advances plus the aggregate Revolving Exposure shall not exceed the aggregate Revolving
Commitments. Protective Advances may be made even if the conditions

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precedent set forth in Section 4.2 have not been satisfied. The Protective Advances shall be
secured by the Liens in favor of the Administrative Agent in and to the Collateral and shall
constitute Obligations hereunder. All Protective Advances shall be ABR Borrowings. The
Administrative Agent’s authorization to make Protective Advances may be revoked at any time by the
Supermajority Revolving Lenders. Any such revocation must be in writing and shall become effective
prospectively upon the Administrative Agent’s receipt thereof. At any time that there is
sufficient Availability and the conditions precedent set forth in Section 4.2 have been satisfied,
the Administrative Agent may request the Revolving Lenders to make a Revolving Loan to repay a
Protective Advance. At any other time the Administrative Agent may require the Lenders to fund
their risk participations described in Section 4.2(b).

     (b) Upon the making of a Protective Advance by the Administrative Agent (whether before or
after the occurrence of a Default), each Lender shall be deemed, without further action by any
party hereto, to have unconditionally and irrevocably purchased from the Administrative Agent
without recourse or warranty, an undivided interest and participation in such Protective Advance in
proportion to its Applicable Percentage. From and after the date, if any, on which any Lender is
required to fund its participation in any Protective Advance purchased hereunder, the
Administrative Agent shall promptly distribute to such Lender, such Lender’s Applicable Percentage
of all payments of principal and interest and all proceeds of Collateral received by the
Administrative Agent in respect of such Protective Advance.

     Section 2.5 Swingline Loans and Overadvances.

     (a) Subject to the terms and conditions set forth herein, the Swingline Lender agrees to make
Swingline Loans to the Borrowers from time to time during the Availability Period, in an aggregate
principal amount at any time outstanding that will not result in (i) the aggregate principal amount
of outstanding Swingline Loans exceeding $30,000,000 or (ii) the total Revolving Exposures
exceeding (x) the lesser of (A) the total Revolving Commitments and (B) the Borrowing Base, minus
(y) the Commitment Reserves; provided that the Swingline Lender shall not be
required to make a Swingline Loan to refinance an outstanding Swingline Loan. Within the foregoing
limits and subject to the terms and conditions set forth herein, the Borrowers may borrow, prepay
and reborrow Swingline Loans. To request a Swingline Loan, the Borrowers shall notify the
Administrative Agent of such request by telephone (confirmed by facsimile), not later than 11:00
a.m., Chicago time, on the day of a proposed Swingline Loan. Each such notice shall be irrevocable
and shall specify the requested date (which shall be a Business Day) and amount of the requested
Swingline Loan. The Administrative Agent will promptly advise the Swingline Lender of any such
notice received from the Borrowers. The Swingline Lender shall make each Swingline Loan available
to the Borrowers by means of a credit to the Funding Account (or, in the case of a Swingline Loan
made to finance the reimbursement of an LC Disbursement as provided in Section 2.6(e), by
remittance to the Issuing Bank, and in the case of repayment of another Loan or fees or expenses as
provided by Section 2.18(c), by remittance to the Administrative Agent to be distributed to the
Lenders) by 2:00 p.m., Chicago time, on the requested date of such Swingline Loan. In addition,
the Borrowers hereby authorize the Swingline Lender to,
and the Swingline Lender shall, subject to the terms and conditions set forth herein (but
without any further written notice required), not later than 1:00 p.m., Chicago time, on each
Business Day, make available to the Borrowers by means of a credit to the Funding Account, the
proceeds of a Swingline Loan to the extent

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necessary to pay items to be drawn on any Controlled
Disbursement Account that day (as determined based on notice from the Administrative Agent).

     (b) The Swingline Lender may by written notice given to the Administrative Agent not later
than 9:00 a.m., Chicago time, on any Business Day require the Revolving Lenders to acquire
participations on such Business Day in all or a portion of the Swingline Loans outstanding. Such
notice shall specify the aggregate amount of Swingline Loans in which Revolving Lenders will
participate. Promptly upon receipt of such notice, the Administrative Agent will give notice
thereof to each Revolving Lender, specifying in such notice such Lender’s Applicable Percentage of
such Swingline Loan or Loans. Each Revolving Lender hereby absolutely and unconditionally agrees,
upon receipt of notice as provided above, to pay to the Administrative Agent, for the account of
the Swingline Lender, such Lender’s Applicable Percentage of such Swingline Loan or Loans. Each
Revolving Lender acknowledges and agrees that its obligation to acquire participations in Swingline
Loans pursuant to this paragraph is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever. Each Revolving Lender shall comply with its
obligation under this paragraph by wire transfer of immediately available funds, in the same manner
as provided in Section 2.7 with respect to Loans made by such Lender (and Section 2.7 shall
apply, mutatis mutandis, to the payment obligations of the Lenders), and the Administrative Agent
shall promptly pay to the Swingline Lender the amounts so received by it from the Revolving
Lenders. The Administrative Agent shall notify the Borrowers of any participations in any
Swingline Loan acquired pursuant to this paragraph, and thereafter payments in respect of such
Swingline Loan shall be made to the Administrative Agent and not to the Swingline Lender. Any
amounts received by the Swingline Lender from the Borrowers (or other party on behalf of the
Borrowers) in respect of a Swingline Loan after receipt by the Swingline Lender of the proceeds of
a sale of participations therein shall be promptly remitted to the Administrative Agent; any such
amounts received by the Administrative Agent shall be promptly remitted by the Administrative Agent
to the Revolving Lenders that shall have made their payments pursuant to this paragraph and to the
Swingline Lender, as their interests may appear; provided that any such payment so
remitted shall be repaid to the Swingline Lender or to the Administrative Agent, as applicable, if
and to the extent such payment is required to be refunded to the Borrowers for any reason. The
purchase of participations in a Swingline Loan pursuant to this paragraph shall not relieve the
Borrowers of any default in the payment thereof.

     (c) Any provision of this Agreement to the contrary notwithstanding, at the request of the
Borrowers, the Administrative Agent may in its sole discretion (but with absolutely no obligation),
make Revolving Loans to the Borrowers, on behalf of the Revolving Lenders, in amounts that exceed
Availability (any such excess Revolving Loans are herein referred to collectively as
“Overadvances”); provided
that, no Overadvance shall result in a Default due to Borrowers’ failure to comply with
Section 2.1 for so long as such Overadvance remains outstanding in accordance with the terms of
this paragraph, but solely with respect to the amount of such Overadvance. In addition,
Overadvances may be made even if the condition precedent set forth in Section 4.2(c) has not been
satisfied. All Overadvances shall constitute ABR Borrowings. The authority of the Administrative
Agent to make Overadvances is limited to an aggregate amount not to exceed $15,000,000 at any time,
each Overadvance shall mature

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and be due on the earlier of the Maturity Date, demand by the
Administrative Agent and thirty days after such Overadvance is made and no Overadvance shall cause
any Revolving Lender’s Revolving Exposure to exceed its Revolving Commitment; provided
that, the Required Lenders may at any time revoke the Administrative Agent’s authorization
to make Overadvances. Any such revocation must be in writing and shall become effective
prospectively upon the Administrative Agent’s receipt thereof.

     (d) Upon the making of an Overadvance by the Administrative Agent, each Revolving Lender shall
be deemed, without further action by any party hereto, to have unconditionally and irrevocably
purchased from the Administrative Agent without recourse or warranty, an undivided interest and
participation in such Overadvance in proportion to its Applicable Percentage of the Revolving
Commitment. The Administrative Agent may, at any time, require the Revolving Lenders to fund their
participations. From and after the date, if any, on which any Revolving Lender is required to fund
its participation in any Overadvance purchased hereunder, the Administrative Agent shall promptly
distribute to such Lender, such Lender’s Applicable Percentage of all payments of principal and
interest and all proceeds of Collateral received by the Administrative Agent in respect of such
Loan.

     (e) Upon the making of a Swingline Loan or an Overadvance (whether before or after the
occurrence of a Default and regardless of whether a Settlement has been requested with respect to
such Swingline Loan or Overadvance), each Revolving Lender shall be deemed, without further action
by any party hereto, to have unconditionally and irrevocably purchased from the Swingline Lender or
the Administrative Agent, as the case may be, without recourse or warranty, an undivided interest
and participation in such Swingline Loan or Overadvance in proportion to its Applicable Percentage
of the Revolving Commitment. The Swingline Lender or the Administrative Agent may, at any time,
require the Revolving Lenders to fund their participations. From and after the date, if any, on
which any Revolving Lender is required to fund its participation in any Swingline Loan or
Overadvance purchased hereunder, the Administrative Agent shall promptly distribute to such Lender,
such Lender’s Applicable Percentage of all payments of principal and interest and all proceeds of
Collateral received by the Administrative Agent in respect of such Loan.

     (f) The Administrative Agent, on behalf of the Swingline Lender, shall request settlement (a
“Settlement”) with the Revolving Lenders on at least a weekly basis or on any date that the
Administrative Agent elects, by notifying the Revolving Lenders of such requested Settlement by
facsimile, telephone, or e-mail no later than 12:00 noon Chicago time on the date of such requested
Settlement (the “Settlement 
Date”). Each Revolving Lender (other than the Swingline Lender, in the case of the
Swingline Loans) shall transfer the amount of such Revolving Lender’s Applicable Percentage of the
outstanding principal amount of the applicable Loan with respect to which Settlement is requested
to the Administrative Agent, to such account of the Administrative Agent as the Administrative
Agent may designate, not later than 2:00 p.m., Chicago time, on such Settlement Date. Settlements
may occur during the existence of a Default and whether or not the applicable conditions precedent
set forth in Section 4.2 have then been satisfied. Such amounts transferred to the Administrative
Agent shall be applied against the amounts of the Swingline Lender’s Swingline Loans and, together
with Swingline Lender’s Applicable Percentage of such Swingline Loan, shall constitute Revolving
Loans of such Revolving Lenders, respectively. If any such amount is not transferred to the
Administrative

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Agent by any Revolving Lender on such Settlement Date, the Swingline Lender shall be
entitled to recover such amount on demand from such Lender together with interest thereon as
specified in Section 2.7.

     Section 2.6 Letters of Credit.

     (a) General. Subject to the terms and conditions set forth herein, Borrowers may
request the issuance of Letters of Credit for the account of one or more Borrowers, in a form
reasonably acceptable to the Administrative Agent and the Issuing Bank, at any time and from time
to time during the Availability Period. In the event of any inconsistency between the terms and
conditions of this Agreement and the terms and conditions of any form of letter of credit
application or other agreement submitted by a Borrower to, or entered into by a Borrower with, the
Issuing Bank relating to any Letter of Credit, the terms and conditions of this Agreement shall
control.

     (b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To
request the issuance of a Letter of Credit (or the amendment, renewal or extension of an
outstanding Letter of Credit), each Borrower shall hand deliver or facsimile (or transmit by
electronic communication, if arrangements for doing so have been approved by the Issuing Bank) to
the Issuing Bank and the Administrative Agent (prior to 9:00 am, Chicago time, at least three
Business Days prior to the requested date of issuance, amendment, renewal or extension, or such
shorter period of time as may be agreed to by the Administrative Agent and the Issuing Bank) a
notice requesting the issuance of a Letter of Credit, or identifying the Letter of Credit to be
amended, renewed or extended, and specifying the date of issuance, amendment, renewal or extension
(which shall be a Business Day), the date on which such Letter of Credit is to expire (which shall
comply with Section 2.6(c)), the amount of such Letter of Credit, the name and address of the
beneficiary thereof and such other information as shall be necessary to prepare, amend, renew or
extend such Letter of Credit. If requested by the Issuing Bank, the requesting Borrower also shall
submit a letter of credit application on the Issuing Bank’s standard form in connection with any
request for a Letter of Credit. A Letter of Credit shall be issued, amended, renewed or extended
only if (and upon issuance, amendment, renewal or extension of each Letter of Credit each Borrower
shall be deemed to represent and warrant that), after giving effect to such issuance, amendment,
renewal or extension (i) the LC Exposure shall not exceed $20,000,000 and (ii) the total Revolving
Exposures
shall not exceed (A) the lesser of the total Revolving Commitments and the Borrowing Base,
minus (B) the Commitment Reserves.

     (c) Expiration Date. Each Letter of Credit shall expire at or prior to the close of
business on the earlier of (i) the date one year after the date of the issuance of such Letter of
Credit (or, in the case of any renewal or extension thereof, one year after such renewal or
extension) and (ii) the date that is five Business Days prior to the Maturity Date.

     (d) Participations. By the issuance of a Letter of Credit (or an amendment to a
Letter of Credit increasing the amount thereof) and without any further action on the part of the
Issuing Bank or the Revolving Lenders, the Issuing Bank hereby grants to each Revolving Lender, and
each Revolving Lender hereby acquires from the Issuing Bank, a participation in such Letter of
Credit equal to such Lender’s Applicable Percentage of the aggregate amount available to be drawn
under such Letter of Credit. In consideration and in furtherance of the

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foregoing, each Revolving
Lender hereby absolutely and unconditionally agrees to pay to the Administrative Agent, for the
account of the Issuing Bank, such Lender’s Applicable Percentage of each LC Disbursement made by
the Issuing Bank and not reimbursed by the Borrowers on the date due as provided in Section
2.6(e), or of any reimbursement payment required to be refunded to the Borrowers for any reason.
Each Revolving Lender acknowledges and agrees that its obligation to acquire participations
pursuant to this paragraph in respect of Letters of Credit is absolute and unconditional and shall
not be affected by any circumstance whatsoever, including any amendment, renewal or extension of
any Letter of Credit or the occurrence and continuance of a Default or reduction or termination of
the Commitments, and that each such payment shall be made without any offset, abatement,
withholding or reduction whatsoever.

     (e) Reimbursement. If the Issuing Bank shall make any LC Disbursement in respect of a
Letter of Credit, the Borrowers shall reimburse such LC Disbursement by paying to the
Administrative Agent an amount equal to such LC Disbursement not later than 11:00 a.m., Chicago
time, on the date that such LC Disbursement is made, if the Borrowers shall have received notice of
such LC Disbursement prior to 9:00 a.m., Chicago time, on such date, or, if such notice has not
been received by the Borrowers prior to such time on such date, then not later than 11:00 a.m.,
Chicago time, on (i) the Business Day that the Borrowers receive such notice, if such notice is
received prior to 9:00 a.m., Chicago time, on the day of receipt, or (ii) the Business Day
immediately following the day that the Borrowers receive such notice, if such notice is not
received prior to such time on the day of receipt; provided that ,if such LC
Disbursement is not less than $250,000, the Borrowers may, subject to the conditions to borrowing
set forth herein, request in accordance with Section 2.3 or Section 2.5 that such payment be
financed with an ABR Revolving Loan Borrowing or Swingline Loan Borrowing in an equivalent amount
and, to the extent so financed, the Borrowers’ obligation to make such payment shall be discharged
and replaced by the resulting ABR Revolving Loan Borrowing or Swingline Loan Borrowing. If the
Borrowers fail to make such payment when due, the Administrative Agent shall notify each Revolving
Lender of the applicable LC Disbursement, the payment then due from the Borrowers in respect
thereof and such Lender’s Applicable Percentage thereof. Promptly following receipt of such
notice, each
Revolving Lender shall pay to the Administrative Agent its Applicable Percentage of the
payment then due from the Borrowers, in the same manner as provided in Section 2.7 with respect to
Loans made by such Lender (and Section 2.7 shall apply, mutatis mutandis, to the payment
obligations of the Revolving Lenders), and the Administrative Agent shall promptly pay to the
Issuing Bank the amounts so received by it from the Revolving Lenders. Promptly following receipt
by the Administrative Agent of any payment from the Borrowers pursuant to this paragraph, the
Administrative Agent shall distribute such payment to the Issuing Bank or, to the extent that
Revolving Lenders have made payments pursuant to this paragraph to reimburse the Issuing Bank, then
to such Lenders and the Issuing Bank as their interests may appear. Any payment made by a
Revolving Lender pursuant to this paragraph to reimburse the Issuing Bank for any LC Disbursement
(other than the funding of ABR Revolving Loans or a Swingline Loan as contemplated above) shall not
constitute a Loan and shall not relieve the Borrowers of their obligation to reimburse such LC
Disbursement.

     (f) Obligations Absolute. The Borrowers’ obligation to reimburse LC Disbursements as
provided in Section 2.6(e) shall be absolute, unconditional and irrevocable, and shall be
performed strictly in accordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability of any

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Letter of Credit
or this Agreement, or any term or provision therein, (ii) any draft or other document presented
under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any
statement therein being untrue or inaccurate in any respect, (iii) payment by the Issuing Bank
under a Letter of Credit against presentation of a draft or other document that does not comply
with the terms of such Letter of Credit, or (iv) any other event or circumstance whatsoever,
whether or not similar to any of the foregoing, that might, but for the provisions of this Section,
constitute a legal or equitable discharge of, or provide a right of setoff against, the Borrowers’
obligations hereunder. Neither the Administrative Agent, the Revolving Lenders nor the Issuing
Bank, nor any of their Related Parties, shall have any liability or responsibility by reason of or
in connection with the issuance or transfer of any Letter of Credit or any payment or failure to
make any payment thereunder (irrespective of any of the circumstances referred to in the preceding
sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any
draft, notice or other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of technical terms or
any consequence arising from causes beyond the control of the Issuing Bank; provided
that the foregoing shall not be construed to excuse the Issuing Bank from liability to the
Borrowers to the extent of any direct damages (as opposed to consequential damages, claims in
respect of which are hereby waived by the Borrowers to the extent permitted by applicable law)
suffered by the Borrowers that are caused by the Issuing Bank’s failure to exercise care when
determining whether drafts and other documents presented under a Letter of Credit comply with the
terms thereof. The parties hereto expressly agree that, in the absence of gross negligence or
willful misconduct on the part of the Issuing Bank (as finally determined by a court of competent
jurisdiction), the Issuing Bank shall be deemed to have exercised care in each such determination.
In furtherance of the foregoing and without limiting the generality thereof, the parties agree
that, with respect to documents presented which appear on their face to be in substantial
compliance with
the terms of a Letter of Credit, the Issuing Bank may, in its sole discretion, either accept
and make payment upon such documents without responsibility for further investigation, regardless
of any notice or information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such Letter of Credit.

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

     (h) Interim Interest. If the Issuing Bank shall make any LC Disbursement, then,
unless the Borrowers shall reimburse such LC Disbursement in full on the date such LC Disbursement
is made, the unpaid amount thereof shall bear interest, for each day from and including the date
such LC Disbursement is made to but excluding the date that the Borrowers reimburse such LC
Disbursement, at the rate per annum then applicable to ABR Revolving Loans; provided
that, if the Borrowers fail to reimburse such LC Disbursement when due pursuant to Section
2.6(e), then Section 2.13(d) shall apply. Interest accrued pursuant to this

47

 

paragraph shall be
for the account of the Issuing Bank, except that interest accrued on and after the date of payment
by any Revolving Lender pursuant to Section 2.6(e) to reimburse the Issuing Bank shall be for the
account of such Lender to the extent of such payment.

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

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

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     Section 2.7 Funding of Borrowings.

     (a) Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof
by wire transfer of immediately available funds by 11:00 a.m. (in the case of Eurodollar Loans) and
1:00 p.m. (in the case of ABR Loans), Chicago time, to the account of the Administrative Agent most
recently designated by it for such purpose by notice to the Lenders in an amount equal to such
Lender’s Applicable Percentage; provided that, Swingline Loans shall be made as
provided in Section 2.5. The Administrative Agent will make such Loans available to the Borrowers
by promptly crediting the amounts so received, in like funds, to the Funding Account;
provided that ABR Revolving Loans made to finance the reimbursement of (i) an LC
Disbursement as provided in Section 2.6(e) shall be remitted by the Administrative Agent to the
Issuing Bank and (ii) a Protective Advance or an Overadvance shall be retained by the
Administrative Agent.

     (b) Unless the Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing that such Lender will not make available to the Administrative Agent
such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has
made such share available on such date in accordance with Section 2.7(a) and may, in reliance upon
such assumption, make
available to the Borrowers a corresponding amount. In such event, if a Lender has not in fact
made its share of the applicable Borrowing available to the Administrative Agent, then the
applicable Lender and the Borrowers severally agree to pay to the Administrative Agent forthwith on
demand such corresponding amount with interest thereon, for each day from and including the date
such amount is made available to the Borrowers to but excluding the date of payment to the
Administrative Agent, at (i) in the case of such Lender, the greater of the Federal Funds Effective
Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on
interbank compensation or (ii) in the case of the Borrowers, the interest rate applicable to ABR
Loans. If such Lender pays such amount to the Administrative Agent, then such amount shall
constitute such Lender’s Loan included in such Borrowing.

     Section 2.8 Interest Elections.

     (a) Each Borrowing initially shall be of the Type specified in the applicable Borrowing
Request and, in the case of a Eurodollar Borrowing, shall have an initial Interest Period as
specified in such Borrowing Request. Thereafter, the Borrowers may elect to convert such Borrowing
to a different Type or to continue such Borrowing and, in the case of a Eurodollar Borrowing, may
elect Interest Periods therefor, all as provided in this Section. The Borrowers may elect
different options with respect to different portions of the affected Borrowing, in which case each
such portion shall be allocated ratably among the Lenders holding the Loans comprising such
Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing.
This Section shall not apply to Swingline Loan Borrowings, Overadvances or Protective Advances,
which may not be converted or continued.

     (b) To make an election pursuant to this Section, the Borrowers shall notify the
Administrative Agent of such election by telephone by the time that a Borrowing Request would be
required under Section 2.3 if the Borrowers were requesting a Borrowing of the Type resulting from
such election to be made on the effective date of such election. Each such

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telephonic Interest
Election Request shall be irrevocable and shall be confirmed promptly by hand delivery or facsimile
to the Administrative Agent of a written Interest Election Request in a form approved by the
Administrative Agent and signed by the Borrowers.

     (c) Each telephonic and written Interest Election Request shall specify the following
information in compliance with Section 2.2:

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

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

     (iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing; and

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

     If any such Interest Election Request requests a Eurodollar Borrowing but does not specify an
Interest Period, then the Borrowers shall be deemed to have selected an Interest Period of one
month’s duration.

     (d) Promptly following receipt of an Interest Election Request, the Administrative Agent shall
advise each Lender of the details thereof and of such Lender’s portion of each resulting Borrowing.

     (e) If the Borrowers fail to deliver a timely Interest Election Request with respect to a
Eurodollar Borrowing prior to the end of the Interest Period applicable thereto, then, unless such
Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be
converted to an ABR Borrowing. Notwithstanding any contrary provision hereof, if a Default has
occurred and is continuing and the Administrative Agent, at the request of the Required Lenders, so
notifies the Borrowers, then, so long as a Default is continuing (i) no outstanding Borrowing may
be converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar
Borrowing shall be converted to an ABR Borrowing at the end of the Interest Period applicable
thereto.

     Section 2.9 Termination and Reduction of Commitments.

     (a) Unless previously terminated, the Commitments shall terminate on the Maturity Date.

     (b) The Borrowers may at any time terminate the Commitments upon (i) the payment in full of
all outstanding Loans, together with accrued and unpaid interest thereon and

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on any Letters of
Credit, (ii) the cancellation and return of all outstanding Letters of Credit (or alternatively,
with respect to each such Letter of Credit, the furnishing to the Administrative Agent of a cash
deposit (or at the discretion of the Administrative Agent a back up standby letter of credit
satisfactory to the Administrative Agent) equal to 105% of the LC Shortfall Amount as of such
date), (iii) the payment in full of the accrued and unpaid fees, and (iv) the payment in full of
all reimbursable expenses and other Obligations together with accrued and unpaid interest thereon.

     (c) The Borrowers may from time to time reduce the Revolving Commitments; provided
that (x) each reduction of the Revolving Commitments shall be in an amount that is an
integral multiple of $10,000,000 and (y) the Borrowers shall not reduce the Revolving Commitments
if, after giving effect to any concurrent prepayment of the Revolving Loans in accordance with
Section 2.10, the sum of the Revolving Exposures would exceed (A) the lesser of the total
Revolving Commitments and the Borrowing Base minus (B) the Commitment Reserves. In the event the
sum of the total unfunded Commitments plus the aggregate principal amount (without duplication) of
Revolving
Exposures and other Loans outstanding at any time is reduced to $100,000,000 or less, the
Commitments shall terminate and all Obligations shall become immediately due and payable in full.

     (d) The Borrowers shall notify the Administrative Agent of any election to terminate or reduce
the Commitments under Section 2.9(b) or Section 2.9(c) at least thirty (30) days prior to the
effective date of such termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent shall advise the
Lenders of the contents thereof. Each notice delivered by the Borrowers pursuant to this Section
shall be irrevocable; provided that a notice of termination of the Commitments
delivered by the Borrowers may state that such notice is conditioned upon the effectiveness of
other credit facilities, in which case such notice may be revoked by the Borrowers (by notice to
the Administrative Agent on or prior to the specified effective date) if such condition is not
satisfied. Any termination or reduction of the Commitments shall be permanent. Each reduction of
the Commitments shall be made ratably among the Lenders in accordance with their respective
Commitments.

     Section 2.10 Repayment and Amortization of Loans; Evidence of Debt.

     (a) The Borrowers hereby, jointly and severally, unconditionally promise to pay (i) to the
Administrative Agent for the account of each Revolving Lender the then unpaid principal amount of
each Revolving Loan on the Maturity Date, (ii) to the Administrative Agent the then unpaid amount
of each Protective Advance on the earlier of the Maturity Date and demand by the Administrative
Agent, (iii) to the Swingline Lender the then unpaid principal amount of each Swingline Loan on the
earlier of the Maturity Date and the first date after such Swingline Loan is made that is the 15th
or last day of a calendar month and is at least two Business Days after such Swingline Loan is
made; provided that on each date that a Revolving Loan is made, the Borrowers shall
repay all Swingline Loans then outstanding, and (iv) to the Administrative Agent the then unpaid
principal amount of each Overadvance on the earlier of the Maturity Date, demand by the
Administrative Agent and the 30th day after such Overadvance is made.

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          (b) At all times that full cash dominion is in effect pursuant to Section 7.3 of the Pledge
and Security Agreement, on each Business Day, at or before 11:00 a.m., Chicago time, the
Administrative Agent shall apply all immediately available funds credited to the Collection
Accounts first to prepay any Protective Advances and Overadvances that may be outstanding, pro
rata, and second to prepay the Revolving Loans (including Swingline Loans) and, if an Event of
Default has occurred and is continuing, to cash collateralize outstanding LC Exposure in an amount
equal to 105% of the LC Shortfall Amount.

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

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

          (e) The entries made in the accounts maintained pursuant to Section 2.10(c) or Section
2.10(d) shall be prima facie evidence of the existence and amounts of the obligations recorded
therein; provided that the failure of any Lender or the Administrative Agent to
maintain such accounts or any error therein shall not in any manner affect the obligation of the
Borrowers to repay the Loans in accordance with the terms of this Agreement.

          (f) Any Lender may request that Loans made by it be evidenced by a promissory note. In such
event, the Borrowers shall prepare, execute and deliver to such Lender a promissory note payable to
the order of such Lender (or, if requested by such Lender, to such Lender and its registered
assigns) and in a form approved by the Administrative Agent. Thereafter, the Loans evidenced by
such promissory note and interest thereon shall at all times (including after assignment pursuant
to Section 9.4) be represented by one or more promissory notes in such form payable to the order
of the payee named therein (or, if such promissory note is a registered note, to such payee and its
registered assigns).

     Section 2.11 Prepayment of Loans.

          (a) The Borrowers shall have the right at any time and from time to time to prepay any
Borrowing in whole or in part, subject to prior notice in accordance with Section 2.11(e).

          (b) Except for Overadvances permitted under Section 2.5, in the event and on such occasion
that the total Revolving Exposure exceeds (x) the lesser of (A) the aggregate Revolving Commitments
and (B) the Borrowing Base, minus (y) the Commitment Reserves, the Borrowers shall prepay the
Revolving Loans, LC Exposure and/or Swingline Loans in an aggregate amount equal to such excess.

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          (c) In the event and on each occasion that any Net Proceeds are received by or on behalf of
any Loan Party in respect of any Prepayment Event, the Borrowers shall, immediately after such Net
Proceeds are received by any Loan Party, prepay the Obligations as set forth in Section 2.11(d)
below in an aggregate amount equal to 100% of such Net Proceeds.

          (d) All such amounts pursuant to Section 2.11(c) (as to any insurance or condemnation
proceeds, to the extent they arise from casualties or losses to Collateral) shall be applied,
first to prepay any Protective Advances and Overadvances that may be outstanding, pro rata,
and second to prepay the Revolving Loans (including Swingline Loans) without a
corresponding reduction in the Revolving Commitment and, if an Event of Default shall have occurred
and is continuing, to cash collateralize outstanding LC Exposure in an amount equal to 105% of the
LC Shortfall Amount.

          (e) The Borrower shall notify the Administrative Agent (and, in the case of prepayment of a
Swingline Loan, the Swingline Lender) by telephone (confirmed by facsimile) of any prepayment
hereunder (i) in the case of prepayment of a Eurodollar Borrowing, not later than 10:00 a.m.,
Chicago time, three Business Days before the date of prepayment, (ii) in the case of prepayment of
an ABR Borrowing, not later than 10:00 a.m., Chicago time, one Business Day before the date of
prepayment or (iii) in the case of prepayment of a Swingline Loan, not later than 11:00 a.m.,
Chicago time, on the date of prepayment. Each such notice shall be irrevocable and shall specify
the prepayment date and the principal amount of each Borrowing or portion thereof to be prepaid;
provided that, if a notice of prepayment is given in connection with a conditional
notice of termination of the Commitments as contemplated by Section 2.9, then such notice of
prepayment may be revoked if such notice of termination is revoked in accordance with Section 2.9.
Promptly following receipt of any such notice relating to a Revolving Loan Borrowing, the
Administrative Agent shall advise the Lenders of the contents thereof. Each partial prepayment of
any Revolving Loan Borrowing shall be in an amount that would be permitted in the case of an
advance of a Revolving Loan Borrowing, as applicable, of the same Type as provided in Section 2.2.
Each prepayment of a Revolving Loan Borrowing shall be applied ratably to the Revolving Loans
included in the prepaid Borrowing. Prepayments shall be accompanied by accrued interest to the
extent required by Section 2.13.

     Section 2.12 Fees.

          (a) The Borrowers agree, jointly and severally, to pay to the Administrative Agent for the
account of each Revolving Lender a commitment fee, which shall accrue at 0.375% per annum on the
average daily amount of the Available Revolving Commitment of such Revolving Lender during the
period from and including the Effective Date to but excluding the date on which the Revolving
Lenders’ Revolving Commitments terminate. Accrued commitment fees shall be payable in arrears on
the last day of each calendar month and on the date on which the Revolving Commitments terminate,
commencing on the first such date to occur after the date hereof. All commitment fees shall be
computed on the basis of a year of 360 days and shall be payable for the actual number of days
elapsed (including the first day but excluding the last day).

          (b) The Borrowers agree, jointly and severally, to pay (i) to the Administrative Agent for the
account of each Revolving Lender a participation fee with respect

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to its participations in Letters of Credit, which shall accrue at a rate per annum equal to
the Applicable Rate used to determine the interest rate applicable to Eurodollar Revolving Loans on
the average daily amount of such Lender’s LC Exposure (excluding any portion thereof attributable
to unreimbursed LC Disbursements) during the period from and including the Effective Date to but
excluding the later of the date on which such Lender’s Revolving Commitment terminates and the date
on which such Revolving Lender ceases to have any LC Exposure, and (ii) to the Issuing Bank a
fronting fee, which shall accrue at the rate of 0.25% per annum on the average daily amount of the
LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) during
the period from and including the Effective Date to but excluding the later of the date of
termination of the Revolving Commitments and the date on which there ceases to be any LC Exposure,
as well as the Issuing Bank’s standard fees with respect to the issuance, amendment, renewal or
extension of any Letter of Credit or processing of drawings thereunder. Participation fees and
fronting fees accrued through and including the last day of each calendar month shall be payable on
the third Business Day following such last day, commencing on the first such date to occur after
the Effective Date; provided that all such fees shall be payable on the date on
which the Revolving Commitments terminate and any such fees accruing after the date on which the
Commitments terminate shall be payable on demand. Any other fees payable to the Issuing Bank
pursuant to this paragraph shall be payable within 10 days after demand. All participation fees
and fronting fees shall be computed on the basis of a year of 360 days and shall be payable for the
actual number of days elapsed (including the first day but excluding the last day).

          (c) The Borrowers agree, jointly and severally, to pay to the Administrative Agent, for its
own account, fees payable in the amounts and at the times separately agreed upon between the
Borrowers and the Administrative Agent.

          (d) All fees payable hereunder shall be paid on the dates due, in immediately available funds,
to the Administrative Agent (or to the Issuing Bank, in the case of fees payable to it) for
distribution, in the case of commitment fees and participation fees, to the Lenders. Fees paid
shall not be refundable under any circumstances.

     Section 2.13 Interest.

          (a) The Loans comprising each ABR Borrowing (including each Swingline Loan) shall bear
interest at the Alternate Base Rate plus the Applicable Rate.

          (b) The Loans comprising each Eurodollar Borrowing shall bear interest at the Adjusted LIBO
Rate for the Interest Period in effect for such Borrowing plus the Applicable Rate.

          (c) Each Protective Advance and each Overadvance shall bear interest at the Alternate Base
Rate plus the Applicable Rate for Revolving Loans plus 2%.

          (d) Notwithstanding the foregoing, during the occurrence and continuance of an Event of
Default, the Administrative Agent or the Required Lenders may, at their option, by notice to the
Borrowers (which notice may be revoked at the option of the Required Lenders notwithstanding any
provision of Section 2.9 requiring the consent of “each Lender affected

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thereby” for reductions in interest rates), declare that (i) all Loans shall bear interest at
2% plus the rate otherwise applicable to such Loans as provided in the preceding paragraphs of this
Section or (ii) in the case of any other amount outstanding hereunder, such amount shall accrue at
2% plus the rate applicable to such fee or other obligation as provided hereunder.

          (e) Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date
for such Loan and upon termination of the Commitments; provided that (i) interest
accrued pursuant to Section 2.13(d) shall be payable on demand, (ii) in the event of any repayment
or prepayment of any Loan (other than a prepayment of an ABR Revolving Loan prior to the end of the
Availability Period), accrued interest on the principal amount repaid or prepaid shall be payable
on the date of such repayment or prepayment and (iii) in the event of any conversion of any
Eurodollar Loan prior to the end of the current Interest Period therefor, accrued interest on such
Loan shall be payable on the effective date of such conversion.

          (f) All interest hereunder shall be computed on the basis of a year of 360 days, except that
interest computed by reference to the Alternate Base Rate at times when the Alternate Base Rate is
based on the Prime Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap
year), and in each case shall be payable for the actual number of days elapsed (including the first
day but excluding the last day). The applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO
Rate shall be determined by the Administrative Agent, and such determination shall be conclusive
absent manifest error.

          (g) Solely for purposes of determining the amount of interest which accrues and is payable in
respect of Revolving Loans, payments of principal will be deemed to be applied to the outstanding
principal balance of the Revolving Loans on the first Business Day following receipt by the
Administrative Agent of collected funds.

     Section 2.14 Alternate Rate of Interest. If prior to the commencement of any Interest
Period for a Eurodollar Borrowing:

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

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

then the Administrative Agent shall give notice thereof to the Borrowers and the Lenders by
telephone or facsimile as promptly as practicable thereafter and, until the Administrative Agent
notifies the Borrowers and the Lenders that the circumstances giving rise to such notice no longer
exist, (i) any Interest Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective, and (ii) if any
Borrowing Request requests a Eurodollar Borrowing, such Borrowing shall be made as an ABR
Borrowing.

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     Section 2.15 Increased Costs.

          (a) If any Change in Law shall:

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

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

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

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

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

          (d) Failure or delay on the part of any Lender or the Issuing Bank to demand compensation
pursuant to this Section shall not constitute a waiver of such Lender’s or the Issuing Bank’s right
to demand such compensation; provided that the Borrowers shall not be required to
compensate a Lender or the Issuing Bank pursuant to this Section for any increased costs or
reductions incurred more than 270 days prior to the date that such Lender or the Issuing
 

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Bank, as the case may be, notifies the Borrowers of the Change in Law giving rise to such
increased costs or reductions and of such Lender’s or the Issuing Bank’s intention to claim
compensation therefor; provided further that, if the Change in Law giving
rise to such increased costs or reductions is retroactive, then the 270-day period referred to
above shall be extended to include the period of retroactive effect thereof.

     Section 2.16 Break Funding Payments. In the event of (a) the payment of any principal of
any Eurodollar Loan other than on the last day of an Interest Period applicable thereto (including
as a result of an Event of Default), (b) the conversion of any Eurodollar Loan other than on the
last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, continue or
prepay any Eurodollar Loan on the date specified in any notice delivered pursuant hereto
(regardless of whether such notice may be revoked under Section 2.9(d) and is revoked in
accordance therewith), or (d) the assignment of any Eurodollar Loan other than on the last day of
the Interest Period applicable thereto as a result of a request by the Borrowers pursuant to
Section 2.19, then, in any such event, the Borrowers shall compensate each Lender for the loss,
cost and expense attributable to such event. In the case of a Eurodollar Loan, such loss, cost or
expense to any Lender shall be deemed to include an amount determined by such Lender to be the
excess, if any, of (i) the amount of interest which would have accrued on the principal amount of
such Loan had such event not occurred, at the Adjusted LIBO Rate that would have been applicable to
such Loan, for the period from the date of such event to the last day of the then current Interest
Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that
would have been the Interest Period for such Loan), over (ii) the amount of interest which would
accrue on such principal amount for such period at the interest rate which such Lender would bid
were it to bid, at the commencement of such period, for dollar deposits of a comparable amount and
period from other banks in the eurodollar market. A certificate of any Lender setting forth any
amount or amounts that such Lender is entitled to receive pursuant to this Section shall be
delivered to the Borrowers and shall be conclusive absent manifest error. The Borrowers shall pay
such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

     Section 2.17 Taxes.

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

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

          (c) The Borrowers shall indemnify the Administrative Agent, each Lender and the Issuing Bank,
within 10 days after written demand therefor, for the full amount of any

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Indemnified Taxes or Other Taxes paid by the Administrative Agent, such Lender or the Issuing
Bank, as the case may be, on or with respect to any payment by or on account of any obligation of
the Borrowers hereunder (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any penalties, interest and reasonable
expenses arising therefrom or with respect thereto (except as such penalties, interest and expenses
are attributable to the negligence or willful misconduct of the Administrative Agent, any Lender or
the Issuing Bank), whether or not such Indemnified Taxes or Other Taxes were correctly or legally
imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such
payment or liability delivered to the Borrowers by a Lender or the Issuing Bank, or by the
Administrative Agent on its own behalf or on behalf of a Lender or the Issuing Bank, shall be
conclusive absent manifest error.

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

          (e) Any Foreign Lender that is entitled to an exemption from, or reduction of, withholding tax
under the law of the jurisdiction in which any Borrower is located, or any treaty to which such
jurisdiction is a party, with respect to payments under this Agreement shall deliver to the
Borrowers (with a copy to the Administrative Agent), at the time such Foreign Lender becomes a
party to this Agreement and at such later times prescribed by applicable law, such properly
completed and executed documentation prescribed by applicable law or reasonably requested by the
Borrowers as will permit such payments to be made without withholding or at a reduced rate.

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

     Section 2.18 Payments Generally; Allocation of Proceeds; Sharing of Set-offs.

          (a) The Borrowers shall make each payment required to be made by it hereunder (whether of
principal, interest, fees or reimbursement of LC Disbursements, or of

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amounts payable under Section 2.15, Section 2.16 or Section 2.17, or otherwise) prior to
11:00 a.m., Chicago time, on the date when due, in immediately available funds, without set off or
counterclaim. Any amounts received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding Business Day for
purposes of calculating interest thereon. All such payments shall be made to the Administrative
Agent at its offices at 120 South LaSalle Street, Chicago, Illinois, except payments to be made
directly to the Issuing Bank or Swingline Lender as expressly provided herein and except that
payments pursuant to Section 2.15, Section 2.16, Section 2.17 and Section 9.3 shall be made
directly to the Persons entitled thereto. The Administrative Agent shall distribute any such
payments received by it for the account of any other Person to the appropriate recipient promptly
following receipt thereof. If any payment hereunder shall be due on a day that is not a Business
Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case
of any payment accruing interest, interest thereon shall be payable for the period of such
extension. All payments hereunder shall be made in dollars. At all times that full cash dominion
is in effect pursuant to Section 7.3 of the Pledge and Security Agreement, solely for purposes of
determining the amount of Loans available for borrowing purposes, checks and cash or other
immediately available funds from collections of items of payment and proceeds of any Collateral
shall be applied in whole or in part against the Obligations, on the day of receipt, subject to
actual collection.

          (b) Any proceeds of Collateral received by the Collateral Agent or the Administrative Agent
(i) not constituting either (A) a specific payment of principal, interest, fees or other sum
payable under the Loan Documents (which shall be applied as specified by the Borrowers), (B) a
mandatory prepayment (which shall be applied in accordance with Section 2.11) or (C) amounts to be
applied from the Collection Account when full cash dominion is in effect pursuant to Section 7.3 of
the Pledge and Security Agreement (which shall be applied in accordance with Section 2.10(b)) or
(ii) after an Event of Default has occurred and is continuing and the Administrative Agent so
elects or the Required Lenders so direct, such funds shall be applied ratably first, to pay
any fees, indemnities, or expense reimbursements including amounts then due to the Agents and the
Issuing Bank from the Borrowers (other than in connection with Banking Services or Swap
Obligations), second, to pay any fees or expense reimbursements then due to the Lenders
from the Borrowers (other than in connection with Banking Services or Swap Obligations),
third, to pay interest due in respect of the Overadvances and Protective Advances,
fourth, to pay the principal of the Overadvances and Protective Advances, fifth, to
pay interest then due and payable on the Loans (other than the Overadvances and Protective
Advances) ratably, sixth, to prepay principal on the Loans (other than the Overadvances and
Protective Advances) and unreimbursed LC Disbursements ratably, seventh, to pay an amount
to the Administrative Agent equal to one hundred five percent (105%) of the LC Shortfall Amount, to
be held as cash collateral for such Obligations, eighth, to payment of any amounts owing
with respect to Banking Services and Swap Obligations, and ninth, to the payment of any
other Secured Obligation due to the Administrative Agent or any Lender by the Borrowers.
Notwithstanding anything to the contrary contained in this Agreement, unless so directed by the
Borrowers, or unless a Default is in existence, neither the Administrative Agent nor any Lender
shall apply any payment which it receives to any Eurodollar Loan of a Class, except (A) on the
expiration date of the Interest Period applicable to any such Eurodollar Loan or (B) in the event,
and only to the extent, that there are no outstanding ABR Loans of the same Class and, in any
event, the Borrowers shall pay the break funding payment required in

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accordance with Section 2.16. The Administrative Agent and the Lenders shall have the continuing and exclusive right
to apply and reverse and reapply any and all such proceeds and payments to any portion of the
Obligations.

          (c) At the election of the Administrative Agent, all payments of principal, interest, LC
Disbursements, fees, premiums, reimbursable expenses (including, without limitation, all
reimbursement for fees and expenses pursuant to Section 9.3), and other sums payable under the
Loan Documents, may be paid from the proceeds of Borrowings made hereunder whether made following a
request by the Borrowers pursuant to Section 2.3 or a deemed request as provided in this Section
or may be deducted from any deposit account of the Borrower maintained with the Administrative
Agent. The Borrowers hereby irrevocably authorize (i) the Administrative Agent to make a Borrowing
for the purpose of paying each payment of principal, interest and fees as it becomes due hereunder
or any other amount due under the Loan Documents and agrees that all such amounts charged shall
constitute Loans (including Swingline Loans and Overadvances, but such a Borrowing may only
constitute a Protective Advance if it is to reimburse costs, fees and expenses as described in
Section 9.3) and that all such Borrowings shall be deemed to have been requested pursuant to
Section 2.3, Section 2.4 or Section 2.5, as applicable and (ii) the Administrative Agent to
charge any deposit account of any Borrower maintained with the Administrative Agent for each
payment of principal, interest and fees as it becomes due hereunder or any other amount due under
the Loan Documents.

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

          (e) Unless the Administrative Agent shall have received notice from the Borrowers prior to the
date on which any payment is due to the Administrative Agent for the

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account of the Lenders or the Issuing Bank hereunder that the Borrowers will not make such
payment, the Administrative Agent may assume that the Borrowers have made such payment on such date
in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the
Issuing Bank, as the case may be, the amount due. In such event, if the Borrowers have not in fact
made such payment, then each of the Lenders or the Issuing Bank, as the case may be, severally
agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such
Lender or Issuing Bank with interest thereon, for each day from and including the date such amount
is distributed to it to but excluding the date of payment to the Administrative Agent, at the
greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in
accordance with banking industry rules on interbank compensation.

          (f) If any Lender shall fail to make any payment required to be made by it hereunder, then the
Administrative Agent may, in its discretion (notwithstanding any contrary provision hereof), apply
any amounts thereafter received by the Administrative Agent for the account of such Lender to
satisfy such Lender’s obligations hereunder until all such unsatisfied obligations are fully paid.

     Section 2.19 Mitigation Obligations; Replacement of Lenders. If any Lender requests
compensation under Section 2.15, or if the Borrowers are required to pay any additional amount to
any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.17,
then:

          (a) such Lender shall use reasonable efforts to designate a different lending office for
funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another
of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.15 or Section
2.17, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed
cost or expense and would not otherwise be disadvantageous to such Lender (and the Borrowers
hereby agree to pay all reasonable costs and expenses incurred by any Lender in connection with any
such designation or assignment);

          (b) the Borrowers may, at their sole expense and effort, require such Lender or any Lender
that defaults in its obligation to fund Loans hereunder (herein, a “Departing Lender”),
upon notice to the Departing Lender and the Administrative Agent, to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in Section 9.4), all its
interests, rights and obligations under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such assignment);
provided that (i) the Borrowers shall have received the prior written consent of
the Administrative Agent (and if a Revolving Commitment is being assigned, the Issuing Bank), which
consent shall not unreasonably be withheld, (ii) the Departing Lender shall have received payment
of an amount equal to the outstanding principal of its Loans and participations in LC Disbursements
and Swingline Loans, accrued interest thereon, accrued fees and all other amounts payable to it
hereunder, from the assignee (to the extent of such outstanding principal and accrued interest and
fees) or the Borrowers (in the case of all other amounts) and (iii) in the case of any such
assignment resulting from a claim for compensation under Section 2.15 or payments required to be
made pursuant to Section 2.17, such assignment will result in a

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reduction in such compensation or payments. A Departing Lender shall not be required to make
any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Borrowers to require such assignment and delegation
cease to apply.

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

     Section 2.21 Borrowings of Revolving Loans to Satisfy Secured Obligations. Each of the
Borrowers and each Lender hereby agree with the Administrative Agent and each other Lender that, on
each date on which any payment of interest, fees, principal or other amounts are due and owing
hereunder or under any of the other Loan Documents, the Administrative Agent may, in its sole
discretion, but without any obligation to do so and subject to all other terms of this Agreement
(other than any request for delivery of a Borrowing Request hereunder) cause a Borrowing of
Swingline Loans to the extent available, and thereafter such Borrowings shall be Revolving Loans
which shall be ABR Loans, each to be made on such date in an amount sufficient to satisfy in full
all such payments of interest, fees or other amounts which are then due hereunder and, the
Administrative Agent shall disburse the proceeds of such Borrowing to itself and each Lender, as
applicable to satisfy all such obligations and liabilities which are then due and the
Administrative Agent shall give the Borrowers prompt notice of any such Borrowings.

     Section 2.22 Joint and Several Liability; Rights of Contribution.

          (a) Each Borrower states and acknowledges that: (i) pursuant to this Agreement, the Borrowers
desire to utilize their borrowing potential on a consolidated basis to the same extent possible if
they were merged into a single corporate entity; (ii) each Borrower has determined that it will
benefit specifically and materially from the advances of credit contemplated by this Agreement;
(iii) it is both a condition precedent to the obligations of the Administrative Agent and Lenders
hereunder and a desire of each Borrower that each Borrower execute and deliver to Administrative
Agent and Lenders this Agreement; and (iv) each Borrower has requested and bargained for the
structure and terms of and security for the advances contemplated by this Agreement.

          (b) Each Borrower hereby irrevocably and unconditionally: (i) agrees that it is jointly and
severally liable to the Administrative Agent and the Lenders for the full and prompt payment and
performance of the obligations of each Borrower under this Agreement and each other Loan Document
that may specify that a particular Borrower is responsible for a given payment or performance; (ii)
agrees to fully and promptly perform all of its obligations

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hereunder with respect to each advance of credit hereunder as if such advance had been made
directly to it; and (iii) agrees as a primary obligation to indemnify the Administrative Agent and
each Lender, on demand for and against any loss incurred by the Administrative Agent or any Lender
as a result of any of the obligations of any Borrower (the “Subject Borrower”) being or
becoming void, voidable, unenforceable or ineffective for any reason whatsoever, whether or not
known to the Subject Borrower or any Person, the amount of such loss being the amount which the
Administrative Agent or the Lenders (or any of them) would otherwise have been entitled to recover
from the Borrower.

          (c) It is the intent of each Borrower that the indebtedness, obligations and liabilities
hereunder and under the other Loan Documents of no one of them be subject to challenge on any basis
related to any federal or state law dealing with fraudulent conveyances or any other law related to
transfers for less than fair or reasonably equivalent value. Accordingly, as of the date hereof,
the liability of each Borrower under this Section 2.22 together with all of its other liabilities
to all persons as of the date hereof and as of any other date on which a transfer is deemed to
occur by virtue of this Agreement, calculated in amount sufficient to pay its probable net
liabilities on its existing indebtedness as the same become absolute and matured (“Dated
Liabilities”) is and is to be, less than the amount of the aggregate of a fair valuation of its
property as of such corresponding date (“Dated Assets”). To this end, each Borrower under
this Section 2.22 (i) grants to and recognizes in each other Borrower ratably, rights of
subrogation and contribution in the amount, if any, by which the Dated Assets of such Borrower, but
for the aggregate rights of subrogation and contribution in its favor recognized herein, would
exceed the Dated Liabilities of such Borrower and (ii) acknowledges receipt of and recognizes its
right to subrogation and contribution ratably from the other Borrowers in the amount, if any, by
which the Dated Liabilities of such Borrower, but for the aggregate of subrogation and contribution
in its favor recognized herein, would exceed the Dated Assets of such Borrower under this Section
2.22. In recognizing the value of the Dated Assets and the Dated Liabilities, it is understood
that each Borrower will recognize, to at least the same extent of their aggregate recognition of
liabilities hereunder, their rights to subrogation and contribution hereunder. It is a material
objective of this Section 2.22 that each Borrower recognizes rights to subrogation and contribution
rather than be deemed to be insolvent (or in contemplation thereof) by reason of an arbitrary
interpretation of its joint and several obligations hereunder.

          (d) Each Borrower agrees and acknowledges that the present structure of the credit facilities
detailed in this Agreement is based in part upon the financial and other information presently
known to the Administrative Agent and the Lenders regarding each Borrower, the corporate structure
of the Borrowers, and the present financial condition of each Borrower. Each Borrower hereby
agrees that the Required Lenders shall have the right, in their sole credit judgment, to require
that any or all of the following changes be made to these credit facilities: (i) further restrict
loans and advances between the Borrowers, (ii) establish separate lockbox and Controlled
Disbursement Accounts for each Borrower, (iii) separate the Swingline Loans and Revolving Loans
into separate revolving credit loans to each of the Borrowers as shall be determined by the
Required Lenders, and (iv) establish such other procedures as shall be reasonably deemed by the
Required Lenders to be useful in tracking where Loans are made under this Agreement and the source
of payments received by the Lenders on such Loans.

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     Section 2.23 Increase of Commitments.

          (a) If no Default or Event of Default shall have occurred and be continuing and no event,
change or condition has occurred that has had, or could reasonably be expected to have, a Material
Adverse Effect, since January 25, 2006, the Borrowers may at any time from time to time prior to
the Maturity Date request one or more increases of the Revolving Commitments by notice to the
Administrative Agent in writing of the amount of such proposed increase (each such notice, a
“Commitment Increase Notice”); provided, however, that, (i) the
Revolving Commitment of any Lender may not be increased without such Lender’s consent, (ii) the
aggregate amount of the Revolving Commitments as so increased shall not exceed $175,000,000, and
(iii) the Revolving Commitments may not be increased without the consent of the Administrative
Agent (which consent shall not be unreasonably withheld or delayed).

          (b) The Borrowers may, in their sole discretion, but with the consent of the Administrative
Agent as to any Person that is not at such time a Lender (which consent shall not be unreasonably
withheld or delayed), offer to any existing Lender or to one or more additional banks or financial
institutions the opportunity to participate in all or a portion of the increased Revolving
Commitments, by notifying the Administrative Agent; provided, that the Revolving Commitment of any
New Lender shall not be less than $15,000,000 and shall be in an integral multiple of $5,000,000.
Promptly and in any event within five (5) Business Days after receipt of notice from the Borrowers
of their desire to offer such commitments to certain existing Lenders or to the additional banks or
financial institutions identified therein, the Administrative Agent shall notify such proposed
lenders of the opportunity to participate in all or a portion of the increased Revolving
Commitments.

          (c) Any existing Lender that accepts Borrowers’ offer to increase its Revolving Commitment
shall execute a Commitment Increase Agreement with the Borrowers and the Administrative Agent,
whereupon such Lender shall be bound by, and entitled to the benefits of, this Agreement with
respect the full amount of its Revolving Commitment as so increased.

          (d) Any additional bank or financial institution which is not an existing Lender and which
accepts Borrowers’ offer to participate in the increased Revolving Commitments shall execute and
deliver to the Administrative Agent and the Borrowers a New Lender Agreement setting forth its
Revolving Commitment (subject to the limitations on the amounts thereof set forth herein), and upon
the effectiveness of such New Lender Agreement such bank or financial institution (a “New
Lender”) shall become a Revolving Lender for all purposes and to the same extent as if
originally a party hereto and shall be bound by and entitled to the benefits of this Agreement, and
the signature pages hereof shall be deemed to be amended to add the name of such New Lender.

          (e) Upon any increase in the Revolving Commitments pursuant to this Section 2.23, the
Commitment Schedule shall be deemed amended to reflect the Revolving Commitment of each Lender
(including any New Lender) as thereby increased.

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ARTICLE III

REPRESENTATIONS AND WARRANTIES

     Each Loan Party represents and warrants to the Lenders that:

     Section 3.1 Organization; Powers. Each of the Loan Parties and each of its Subsidiaries is
duly organized, validly existing and in good standing under the laws of the jurisdiction of its
organization, has all requisite power and authority to carry on its business as now conducted and
is qualified to do business in, and is in good standing in, every jurisdiction where the failure to
so qualify could reasonably be expected to have a Material Adverse Effect.

     Section 3.2 Authorization; Enforceability. The Transactions are within each Loan Party’s
corporate or limited liability company powers and have been duly authorized by all necessary
corporate or limited liability company and, if required, stockholder action. The Loan Documents to
which each Loan Party is a party have been duly executed and delivered by such Loan Party and
constitute a legal, valid and binding obligation of such Loan Party, enforceable in accordance with
its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors’ rights generally and subject to general principles of equity, regardless of
whether considered in a proceeding in equity or at law.

     Section 3.3 Governmental Approvals; No Conflicts. The Transactions (a) do not require any
consent or approval of, registration or filing with, or any other action by, any Governmental
Authority, except such as have been obtained or made and are in full force and effect and except
for filings necessary to perfect Liens created pursuant to the Loan Documents, including actions
required to satisfy the Federal Assignment of Claims Act of 1940, (b) will not violate any
Requirement of Law applicable to any Loan Party or any of its Subsidiaries, (c) will not violate or
result in a default under any indenture, agreement or other instrument binding upon any Loan Party
or any of its Subsidiaries or its assets, or give rise to a right thereunder to require any payment
to be made by any Loan Party or any of its Subsidiaries, and (d) will not result in the creation or
imposition of any Lien on any asset of any Loan Party or any of its Subsidiaries, except Liens
created pursuant to the Loan Documents.

     Section 3.4 Financial Condition; No Material Adverse Change.

          (a) Current Financials. The Current Financials were prepared in accordance with GAAP
as in effect on the date such Current Financials are delivered (subject, in the case of interim
financial statements, to the absence of footnotes and year-end audit adjustments which will not,
individually or in the aggregate, be material) and fairly present the consolidated and
consolidating financial condition and results of operations of the Company and its consolidated
Subsidiaries as of the dates and for the periods reflected therein.

          (b) Historical Financials. The Borrowers have heretofore furnished to the Lenders (i)
the audited consolidated financial statements of Stewart & Stevenson Services, Inc. for the fiscal
years ended January 31, 2002, January 31, 2003, January 31, 2004 and January 31, 2005 reported on
by Ernst & Young, independent public accountants, (ii) management prepared consolidated and
consolidating financial statements for Stewart & Stevenson Services, Inc. for the fiscal years
ended January 31, 2002, January 31, 2003, January 31, 2004 and January 31,

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2005, and (iii) management prepared interim consolidated and consolidating financial
statements of Stewart & Stevenson Services, Inc. for the fiscal quarter ended October 9, 2005 and
for the month ended November 30, 2005, certified by its chief financial officer. Such financial
statements present fairly, in all material respects, the financial position and results of
operations and cash flows of Stewart & Stevenson Services, Inc. as of such dates and for such
periods in accordance with GAAP, subject to year end audit adjustments and the absence of footnotes
in the case of the statements referred to in clauses (ii) and (iii) above.

          (c) Absence of Contingent Liabilities. No Loan Party has any outstanding Indebtedness
or other liability (including, without limitation, contingent liabilities) or unusual, forward or
long term commitments which if unpaid could reasonably be expected to result in a Material Adverse
Effect other than (i) those disclosed in the most recent financial statements referred to in
Section 5.1(a), (b), (c) or (d) below, as applicable, or the notes thereto, (ii) those expressly
described in this Agreement (including in the Schedules hereto), and (iii) those entered into or
incurred in compliance with the terms of this Agreement.

          (d) Pro-Forma Consolidated Balance Sheets. The pro forma consolidated balance sheet
of the Company and the pro forma consolidating balance sheets of the Company and each Subsidiary of
the Company each dated as of December 31, 2005, provided to the Administrative Agent and the
Lenders prior to the date of this Agreement, fairly presents, in conformity with GAAP, the
consolidated financial position of the Company as of such date and the consolidating financial
position of the Company and each Subsidiary of the Company as of such date, but adjusted to give
effect to the Closing Date Acquisition and the Transactions.

          (e) Projections. The projections delivered to the Administrative Agent and the
Lenders pursuant to Section 4.1(b) and Section 5.1(f) set forth the Borrowers’ reasonable best
estimate as of the date hereof of the Company’s consolidated financial condition and results of
operations as of the dates and for the periods covered thereby. Such projections were prepared in
good faith in accordance with sound financial planning practices on the basis of the assumptions
stated therein, which assumptions were believed by the Borrowers to be reasonable at the time made
and which the Borrowers continue to believe are reasonable on the date hereof.

          (f) No Material Adverse Change. No event, change or condition has occurred that has
had, or could reasonably be expected to have, a Material Adverse Effect, since January 31, 2005.

          (g) Effective Date Payables to Detroit Diesel, Deutz and Hyster. As of the Effective
Date, the aggregate amount of all accounts payable and other amounts owing to Detroit Diesel, Deutz
and Hyster is zero Dollars ($0.00).

     Section 3.5 Properties.

          (a) As of the date of this Agreement, Schedule 3.5 sets forth the address of each
parcel of real property that is owned or leased by each Loan Party. Each of such leases and
subleases is valid and enforceable in accordance with its terms and is in full force and effect,
and no default by any party to any such lease or sublease exists that could reasonably be expected
to result in a Material Adverse Effect. Each of the Loan Parties and its Subsidiaries has good and

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indefeasible title to, or valid leasehold interests in, all its real and personal property,
free of all Liens other than those permitted by Section 6.2.

          (b) Each Loan Party and its Subsidiaries owns, or is licensed to use, all trademarks,
tradenames, copyrights, patents and other intellectual property necessary to its business as
currently conducted, a correct and complete list of which, as of the date of this Agreement, is set
forth on Schedule 3.5, and the use thereof by the Loan Parties and its Subsidiaries does
not infringe in any material respect upon the rights of any other Person, and the Loan Parties’
rights thereto are not subject to any licensing agreement or similar arrangement.

     Section 3.6 Litigation and Environmental Matters.

          (a) There are no actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of any Loan Party, threatened against or affecting
the Loan Parties or any of their Subsidiaries or any of the Collateral (i) as to which there is a
reasonable possibility of an adverse determination and that, if adversely determined, could
reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect
(other than the Disclosed Matters) or (ii) that involve this Agreement or the Transactions.

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

          (c) Since the date of this Agreement, there has been no change in the status of the Disclosed
Matters that, individually or in the aggregate, has resulted in, or materially increased the
likelihood of, a Material Adverse Effect.

     Section 3.7 Compliance with Laws and Agreements. Each Loan Party and its Subsidiaries is
in compliance with all Requirements of Law applicable to it or its property and all indentures,
agreements and other instruments binding upon it or its property, except where the failure to do
so, individually or in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect.

     Section 3.8 Investment and Holding Company Status. No Loan Party nor any of its
Subsidiaries is (a) an “investment company” as defined in, or subject to regulation under, the
Investment Company Act of 1940 or (b) a “holding company” as defined in, or subject to regulation
under, the Public Utility Holding Company Act of 1935.

     Section 3.9 Taxes. Each Loan Party and its Subsidiaries have timely filed or caused to be
filed all income and other Tax returns and reports required to have been filed and have paid or
caused to be paid all income and other Taxes required to have been paid by it, except Taxes that
are being contested in good faith by appropriate proceedings and for which such Loan Party

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or such Subsidiary, as applicable, has set aside on its books adequate reserves. No tax liens have
been filed and no claims are being asserted with respect to any such taxes.

     Section 3.10 ERISA. No ERISA Event has occurred or is reasonably expected to occur that,
when taken together with all other such ERISA Events for which liability is reasonably expected to
occur, could reasonably be expected to result in a Material Adverse Effect. The present value of
all accumulated benefit obligations under each Plan (based on the assumptions used for purposes of
Statement of Financial Accounting Standards No. 87) did not, as of the date of the most recent
financial statements reflecting such amounts, exceed the fair market value of the assets of such
Plan, and the present value of all accumulated benefit obligations of all underfunded Plans (based
on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did
not, as of the date of the most recent financial statements reflecting such amounts, exceed the
fair market value of the assets of all such underfunded Plans.

     Section 3.11 Disclosure. The Borrowers have disclosed to the Lenders all agreements,
instruments and corporate or other restrictions to which any Loan Party is subject, and all other
matters known to them, that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect. Neither the Information Memorandum nor any of the other
reports, financial statements, certificates or other information furnished by or on behalf of the
any Loan Party to the Administrative Agent or any Lender in connection with the negotiation of this
Agreement or any other Loan Document (as modified or supplemented by other information so
furnished) as of the date of delivery, contains any material misstatement of fact or omits to state
any material fact necessary to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided that, with respect to forecast or
projected financial information, the Borrowers represent only that such information was prepared in
good faith based upon assumptions believed to be reasonable at the time delivered and, if such
projected financial information was delivered prior to the Effective Date, as of the Effective
Date.

     Section 3.12 Material Agreements. All material agreements and contracts to which any Loan
Party is a party or is bound as of the date of this Agreement are listed on Schedule 3.12.
No Loan Party is in default in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in (a) any material agreement to which it is a party
or (b) any agreement or instrument evidencing or governing Indebtedness, where such default could
reasonably by expected to result in a Material Adverse Effect.

     Section 3.13 Solvency.

          (a) Immediately after the consummation of the Transactions to occur on the Effective Date, (i)
the fair value of the assets of each Loan Party, at a fair valuation, will exceed its debts and
liabilities, subordinated, contingent or otherwise; (ii) the present fair saleable value of the
property of each Loan Party will be greater than the amount that will be required to pay the
probable liability of its debts and other liabilities, subordinated, contingent or otherwise, as
such debts and other liabilities become absolute and matured; (iii) each Loan Party will be able to
pay its debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities
become absolute and matured; and (iv) each Loan Party will not have unreasonably small capital

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with which to conduct the business in which it is engaged as such business is now conducted
and is proposed to be conducted after the Effective Date.

          (b) No Loan Party intends to, or will permit any of its Subsidiaries to, and no Loan Party
believes that it or any of its Subsidiaries will, incur debts beyond its ability to pay such debts
as they mature, taking into account the timing of and amounts of cash to be received by it or any
such Subsidiary and the timing of the amounts of cash to be payable on or in respect of its
Indebtedness or the Indebtedness of any such Subsidiary.

     Section 3.14 Insurance. Schedule 3.14 sets forth a description of all insurance
maintained by or on behalf of the Loan Parties and the Subsidiaries as of the Effective Date. As
of the Effective Date, all premiums in respect of such insurance have been paid. The Borrowers
believe that the insurance maintained by or on behalf of the Borrowers and their Subsidiaries is
adequate.

     Section 3.15 Capitalization and Subsidiaries. Schedule 3.15 sets forth (a) a
correct and complete list of the name and relationship to the Borrowers of each and all of each
Borrower’s Subsidiaries, (b) a true and complete listing of each class of each of the Borrowers’
authorized Equity Interests, of which all of such issued shares are validly issued, outstanding,
fully paid and non-assessable, and owned beneficially and of record by the Persons identified on
Schedule 3.15, and (c) the type of entity of each Borrower and each of its Subsidiaries.
All of the issued and outstanding Equity Interests owned by any Loan Party have been (to the extent
such concepts are relevant with respect to such ownership interests) duly authorized and issued and
are fully paid and non assessable.

     Section 3.16 Security Interest in Collateral. Except to the extent perfection is expressly
excused pursuant to the Loan Documents, the provisions of this Agreement and the other Loan
Documents create legal and valid Liens on all the Collateral in favor of the Collateral Agent, for
the benefit of the Agents, the Lenders, and the Other Secured Parties, and such Liens constitute
perfected and continuing Liens on the Collateral, securing the Secured Obligations, enforceable
against the applicable Loan Party and all third parties, and having priority over all other Liens
on the Collateral except for (a) Permitted Senior Encumbrances, and (b) Liens perfected only by
possession (including possession of any certificate of title) to the extent the Collateral Agent
has not obtained or does not maintain possession of such Collateral.

     Section 3.17 Labor Disputes. As of the Effective Date, there are no strikes, lockouts or
slowdowns against any Loan Party or any Subsidiary pending or, to the knowledge of the Borrowers,
threatened. The hours worked by and payments made to employees of the Loan Parties and the
Subsidiaries have not been in violation of the Fair Labor Standards Act or any other applicable
Federal, state, local or foreign law dealing with such matters. All payments due from any Loan
Party or any Subsidiary, or for which any claim may be made against any Loan Party or any
Subsidiary, on account of wages and employee health and welfare insurance and other benefits, have
been paid or accrued as a liability on the books of the Loan Party or such Subsidiary.

     Section 3.18 Affiliate Transactions. Except as set forth on Schedule 3.18, as of
the date of this Agreement, there are no existing or proposed agreements, arrangements,

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understandings, or transactions between any Loan Party and any of the officers, members, managers,
directors, stockholders, parents, other interest holders, employees, or Affiliates (other than
Subsidiaries) of any Loan Party or any members of their respective immediate families, and none of
the foregoing Persons are directly or indirectly indebted to or have any direct or indirect
ownership, partnership, or voting interest in any Affiliate of any Loan Party or any Person with
which any Loan Party has a business relationship or which competes with any Loan Party.

     Section 3.19 Common Enterprise. The successful operation and condition of each of the Loan
Parties are dependent on the continued successful performance of the functions of the group of the
Loan Parties as a whole and the successful operation of each of the Loan Parties is dependent on
the successful performance and operation of each other Loan Party. Each Loan Party expects to
derive benefit (and its board of directors or other governing body has determined that it may
reasonably be expected to derive benefit), directly and indirectly, from (a) successful operations
of each of the other Loan Parties and (b) the credit extended by the Lenders to the Borrowers
hereunder, both in their separate capacities and as members of the group of companies. Each Loan
Party has determined that execution, delivery, and performance of this Agreement and any other Loan
Documents to be executed by such Loan Party is within its purpose, will be of direct and indirect
benefit to such Loan Party, and is in its best interest.

     Section 3.20 Casualties; Taking of Properties. Neither the business nor the properties of
any Loan Party has been affected in a manner that has had or could have a Material Adverse Effect
as a result of any fire, explosion, earthquake, flood, drought, windstorm, accident, strike or
other labor disturbance, embargo, requisition or taking of property or cancellation of contracts,
permits or concessions by any domestic or foreign government or any agency thereof, riot,
activities of armed forces or acts of God or of any public enemy.

     Section 3.21 Perfection Certificate; Schedules to other Loan Documents. All information in
the Perfection Certificate and each Perfection Certificate Update and all information set forth in
all disclosure schedules to each of the Loan Documents is true, correct and complete. No Borrower
has filed a US federal income tax return or any other tax return with a Governmental Authority
under a name different in any respect from the name of that Borrower listed on the signature pages
hereto or the prior names of that Borrower set forth in the Perfection Certificate.

     Section 3.22 Existing Indebtedness. Schedule 3.22 hereto contains an accurate and
complete list and description of any and all Indebtedness of the Loan Parties existing on the date
of this Agreement prior to giving effect to the repayment of any such Indebtedness to be repaid on
the date of this Agreement, and including, with respect to each such item of existing Indebtedness:
(a) the current lender or holder of such Indebtedness, (b) the principal amount of such
Indebtedness on the date of this Agreement prior to giving effect to the repayment of any such
Indebtedness, (c) a description of the material loan agreements, promissory notes and other
documents evidencing, governing or otherwise pertaining to such Indebtedness, and (d) a description
of all property which stands as security for such Indebtedness.

     Section 3.23 Acquisition Documents. The Borrowers have provided to the Administrative
Agent a true and complete copy of the Acquisition Agreements and all other Acquisition Documents
entered into by any Loan Party related to the Closing Date Acquisition,

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including all amendments and modifications thereto (whether characterized as an amendment,
modification, waiver, consent or similar document). No material rights or obligations of any party
to any of the Acquisition Documents have been waived and no party to any of the Acquisition
Documents is in default of its obligations or in breach of any representations or warranties made
thereunder. Each of the Acquisition Documents is a valid, binding and enforceable obligation of
each party thereto in accordance with its terms and is in full force and effect. The fees and
expenses relating to the Closing Date Acquisition do not exceed $5,000,000.

     Section 3.24 Deposit Accounts. Other than the Controlled Disbursement Account and the
deposit accounts listed on Schedule 3.24, none of the Borrowers maintains any deposit
account with any bank or other depository institution into which any cash or cash equivalents are
deposited or cash or cash equivalents are maintained.

     Section 3.25 Regulation H. No Mortgage encumbers improved Real Property that is located in
an area that has been identified by the Secretary of Housing and Urban Development as an area
having special flood hazards and in which flood insurance has been made available under the
National Flood Insurance Act of 1968, except for which the Administrative Agent has received
evidence of an acceptable flood hazard insurance policy covering such improvements.

     Section 3.26 Compliance with Anti-Terrorism and Anti-Money Laundering Laws and Regulations.
No Loan Parties nor any of their Affiliates, nor any of their respective partners, members,
shareholders or other equity owners, and none of their respective employees, officers, directors,
representatives or agents, is, nor will they become, a person or entity with whom U.S. persons or
entities are restricted from doing business under regulations of the Office of Foreign Asset
Control (“OFAC”) of the Department of the Treasury (including those named on OFAC’s
Specially Designated Nationals and Blocked Persons List) or under any statute, executive order
(including the September 24, 2001, Executive Order Blocking Property and Prohibiting Transactions
with Persons Who Commit, Threaten to Commit, or Support Terrorism), or other governmental action
and is not and will not engage in any dealings or transactions or be otherwise associated with such
persons or entities.

ARTICLE IV

CONDITIONS

     Section 4.1 Effective Date. The amendment and restatement of the Existing Credit Agreement
and the obligations of the Lenders to make Loans (including, without limitation, the True-Up Loans)
and of the Issuing Bank to issue Letters of Credit hereunder shall not become effective until the
date on which each of the following conditions is satisfied (or waived in accordance with Section
9.2) as evidenced by the execution and delivery of the Certificate of Effectiveness:

          (a) Credit Agreement and Loan Documents. The Administrative Agent (or its counsel)
shall have received (i) from each party hereto either (A) a counterpart of this Agreement signed on
behalf of such party or (B) written evidence satisfactory to the Administrative Agent (which may
include facsimile transmission of a signed signature page of this Agreement) that such party has
signed a counterpart of this Agreement and (ii) duly

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executed copies of the Loan Documents and such other certificates, documents, instruments
and agreements as the Administrative Agent shall reasonably request in connection with the
transactions contemplated by this Agreement and the other Loan Documents, including any promissory
notes requested by a Lender pursuant to Section 2.10 payable to the order of each such requesting
Lender and a written opinion of the Loan Parties’ counsel, addressed to each Agent, the Issuing
Bank and the Lenders in substantially the form of Exhibit B.

          (b) Financial Statements and Projections. The Lenders shall have received (i) audited
consolidated financial statements of Stewart & Stevenson Services, Inc. for the fiscal years ended
January 31, 2002, January 31, 2003, January 31, 2004 and January 31, 2005, (ii) management prepared
consolidated and consolidating financial statements for Stewart & Stevenson Services, Inc. for the
fiscal years ended January 31, 2002, January 31, 2003, January 31, 2004 and January 31, 2005, (iii)
management prepared interim consolidated and consolidating financial statements of Stewart &
Stevenson Services, Inc. for the fiscal quarter ended October 29, 2005 and for the month ended
November 30, 2005, (iv) all written material, reports and/or management letters, if any, requested
by the Administrative Agent and prepared by the current independent accountants of Stewart &
Stevenson Services, Inc. with regard to its Engineered Products Division or its Power Products
Division, and in the case of clauses (i), (ii), (iii) and (iv) preceding, such financial
statements shall not, in the reasonable judgment of the Administrative Agent, reflect any material
adverse change in the consolidated financial condition of the Engineered Products Division and the
Power Products Division, as reflected in the financial statements or projections contained in the
Confidential Information Memorandum and (v) satisfactory projections through 2010.

          (c) Closing Certificates; Certified Certificate of Incorporation; Good Standing
Certificates. The Administrative Agent shall have received (i) a certificate of each Loan
Party, dated the Effective Date and executed by its Secretary or Assistant Secretary, which shall
(A) certify the resolutions of its Board of Directors, members or other body authorizing the
execution, delivery and performance of the Loan Documents to which it is a party, (B) identify by
name and title and bear the signatures of the Financial Officers and any other Responsible Officers
of such Loan Party authorized to sign the Loan Documents to which it is a party, and (C) contain
appropriate attachments, including the certificate or articles of incorporation or organization of
each Loan Party certified by the relevant authority of the jurisdiction of organization of such
Loan Party and a true and correct copy of its by laws or operating, management or partnership
agreement, (ii) a long form good standing certificate for each Loan Party from its jurisdiction of
organization, and (iii) a good standing/foreign qualification certificate for each Loan Party for
each jurisdiction where such Loan Party is required to be qualified to do business.

          (d) No Default Certificate. The Administrative Agent shall have received a certificate,
signed by the chief financial officer of each Borrower, on the Effective Date (i) stating that no
Default has occurred and is continuing at the time of and immediately after giving effect to (1)
the amendment and restatement of the Existing Credit Agreement and the making of all True-Up Loans
required thereby, and (2) the funding of all Borrowings and issuance of all Letters of Credit
occurring on the Effective Date, if any, (ii) stating that the representations and warranties
contained in Article III are true and correct as of such date, and

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(iii) certifying any other factual matters as may be reasonably requested by the
Administrative Agent.

          (e) Fees. The Lenders and the Administrative Agent shall have received all fees
required to be paid, and all expenses for which invoices have been presented (including the
reasonable fees and expenses of legal counsel to the Administrative Agent and local counsel), on or
before the Effective Date. All such amounts will be paid with proceeds of Loans made on the
Effective Date and will be reflected in the funding instructions given by the Borrowers to the
Administrative Agent on or before the Effective Date.

          (f) Lien Searches. The Administrative Agent shall have received the results of a
recent lien search in each of the jurisdictions where the Loan Parties are organized or assets of
the Loan Parties are located, and such search shall reveal no liens on any of the assets of the
Loan Parties except for liens permitted by Section 6.2 or discharged on or prior to the Effective
Date pursuant to a pay-off letter or other documentation satisfactory to the Administrative Agent.

          (g) Consummation of Senior Notes Offering. The Company shall have completed the Notes
Offering and issued the Senior Notes on the terms set forth in the Senior Notes Offering Memorandum
and otherwise on terms and conditions acceptable to the Administrative Agent and the Lenders.

          (h) Repayment of Existing Indebtedness. All unpaid CapEx Loans, Real Estate Loans,
Equipment Loans and Term B Loans (as such terms are defined in the Existing Credit Agreement) and
all accrued and unpaid fees and interest owing under the Existing Credit Agreement shall be paid in
full in cash by the Borrowers and the outstanding balance of the Revolving Loans (as defined in the
Existing Credit Agreement) shall be reduced by the lesser of (i) $85,000,000 or (ii) the
outstanding balance of the Revolving Loans on such date.

          (i) Funding Account. The Administrative Agent shall have received a notice setting
forth the deposit account of the Borrowers (the “Funding Account”) to which the
Administrative Agent is authorized by the Borrowers to transfer the proceeds of any Borrowings
requested or authorized pursuant to this Agreement.

          (j) Customer List. The Administrative Agent shall have received a true and complete
customer list.

          (k) Collateral Access and Control Agreements. The Collateral Agent shall have
received each (i) Collateral Access Agreement required to be provided pursuant to Section 4.13 of
the Pledge and Security Agreement and (ii) Deposit Account Control Agreement required to be
provided pursuant to Section 4.14 of the Pledge and Security Agreement.

          (l) Solvency. The Administrative Agent shall have received a solvency certificate
from a Financial Officer of each Loan Party.

          (m) Borrowing Base Certificate. The Administrative Agent shall have received a
Borrowing Base Certificate which calculates the Borrowing Base as of June 3, 2006.

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          (n) Closing Availability. After giving effect to the repayments required pursuant to
clause (h) above, to all Borrowings to be made on the Effective Date and the issuance of any
Letters of Credit on the Effective Date and payment of all fees and expenses due hereunder, and
with all of the Loan Parties’ indebtedness, liabilities, and obligations current, the Borrowers’
Availability shall not be less than $30,000,000.

          (o) Pledged Notes. The Collateral Agent shall have each promissory note or other
instrument (if any) pledged to the Collateral Agent pursuant to the Pledge and Security Agreement
endorsed (without recourse) in blank (or accompanied by an executed transfer form in blank) by the
pledgor thereof.

          (p) Filings, Registrations and Recordings. Each document (including any Uniform
Commercial Code financing statement) required by the Collateral Documents or under law or
reasonably requested by the Collateral Agent to be filed, registered or recorded in order to create
in favor of the Collateral Agent, for the benefit of the Agents, the Lenders and the Other Secured
Parties, a perfected Lien on the Collateral described therein, prior and superior in right to any
other Person (other than with respect to Liens expressly permitted by Section 6.2), shall be in
proper form for filing, registration or recordation.

          (q) Environmental Reports. The Administrative Agent shall have received environmental
review reports with respect to the Real Properties of the Borrowers and their Subsidiaries
specified by the Administrative Agent from firm(s) satisfactory to the Administrative Agent, which
review reports shall be acceptable to the Administrative Agent.

          (r) Mortgages, etc. The Collateral Agent shall have received, with respect to each
parcel of Real Property which is required to be subject to a Lien in favor of the Collateral Agent,
each of the following, in form and substance reasonably satisfactory to the Collateral Agent:

          (i) a Mortgage on such property;

          (ii) evidence that a counterpart of the Mortgage has been recorded in the place
necessary, in the Collateral Agent’s judgment, to create a valid and enforceable first
priority Lien in favor of the Collateral Agent for the benefit of itself, the Administrative
Agent, the Lenders, and the Other Secured Parties;

          (iii) ALTA or other mortgagee’s title policy and endorsements;

          (iv) an ALTA survey prepared and certified to the Agents by a surveyor acceptable to
the Collateral Agent;

          (v) an opinion of counsel in the state in which such parcel of Real Property is located
in form and substance and from counsel reasonably satisfactory to the Collateral Agent; and

          (vi) such other information, documentation, and certifications as may be reasonably
required by the Collateral Agent.

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          (s) Insurance. The Agents shall have received evidence of insurance coverage in form,
scope, and substance reasonably satisfactory to the Agents and otherwise in compliance with the
terms of Section 5.9 hereof and Section 4.12 of the Pledge and Security Agreement.

          (t) Letter of Credit Application. The Administrative Agent shall have received a
properly completed letter of credit application if the issuance of a Letter of Credit will be
required on the Effective Date. The Borrowers shall have executed the Issuing Bank’s master
agreement for the issuance of commercial Letters of Credit.

          (u) Senior Notes Documents. The Administrative Agent shall have received a certified
true and correct copy of each of the Senior Notes Documents.

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

provided, however, the Administrative Agent and the Lenders acknowledge that the
conditions precedent set forth in the foregoing clauses (b), (i), (j), (p), (q), (r) and (t) of
this Section 4.1 have been satisfied prior to the Effective Date.

Pursuant to and upon the execution and delivery of the Certificate of Effectiveness, the
Administrative Agent shall notify the Borrowers and the Lenders of the Effective Date, and such
notice shall be conclusive and binding. Notwithstanding the foregoing, the obligations of the
Lenders to make Loans and of the Issuing Bank to issue Letters of Credit hereunder shall not become
effective unless each of the foregoing conditions is satisfied (or waived pursuant to Section 9.2)
at or prior to 2:00 p.m., Chicago time, on July 31, 2006 (and, in the event such conditions are not
so satisfied or waived, the Commitments shall terminate at such time).

     Section 4.2
Each Credit Event. The obligation of each Lender to make a Loan on the occasion of any
Borrowing, and of the Issuing Bank to issue, amend, renew or extend any Letter of Credit, is
subject to the satisfaction of the following conditions:

          (a) The representations and warranties of the Borrowers set forth in this Agreement shall be
true and correct in all material respects on and as of the date of such Borrowing or the date of
issuance, amendment, renewal or extension of such Letter of Credit, as applicable, except to the
extent such representations or warranties expressly relate to an earlier date, or if they are not
true and correct in all material respects neither the Administrative Agent nor the Required Lenders
shall have determined not to make any make a Loan or instructed the Issuing Bank not to issue
Letters of Credit as a result of the fact that such representation or warranty is untrue or
incorrect.

          (b) At the time of and immediately after giving effect to such Borrowing or the issuance,
amendment, renewal or extension of such Letter of Credit, as applicable, no Default shall have
occurred and be continuing or if a Default has occurred and is continuing, neither the
Administrative Agent nor the Required Lenders shall have determined not to make such

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Borrowing or
instructed the Issuing Bank not to issue such Letter of Credit as a
result of such Default.

          (c) After giving effect to any Revolving Loan Borrowing or the issuance of any Letter of
Credit, Availability is not less than zero.

Each Borrowing and each issuance, amendment, renewal or extension of a Letter of Credit shall be
deemed to constitute a representation and warranty by the Borrowers on the date thereof as to the
matters specified in Section 4.2(a), Section 4.2(b) and Section 4.2(c).

ARTICLE V

AFFIRMATIVE COVENANTS

     Until the Commitments have expired or been terminated and the principal of and interest on
each Loan and all fees payable hereunder shall have been paid in full and all Letters of Credit
shall have expired or terminated and all LC Disbursements shall have been reimbursed, each Loan
Party executing this Agreement covenants and agrees, jointly and severally with all of the Loan
Parties, with the Lenders that:

     Section 5.1
Financial Statements; Borrowing Base and Other Information. The Borrowers will furnish to
the Administrative Agent, each Lender and, with respect to the certificate specified in Section
5.1(q) hereof, the Collateral Agent:

          (a) within 90 days after the end of each fiscal year of the Company, its audited consolidated
balance sheet and related statements of operations, stockholders’ equity and cash flows as of the
end of and for such year, setting forth in each case in comparative form the figures for the
previous fiscal year, all reported on by independent public accountants of recognized national
standing acceptable to the Required Lenders (without a “going concern” or like qualification or
exception and without any qualification or exception as to the scope of such audit) to the effect
that such consolidated financial statements present fairly in all material respects the financial
condition and results of operations of the Company and its consolidated Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied, accompanied by any management
letter prepared by said accountants;

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

          (c) within 20 days after the end of each fiscal month of the Company, its consolidated and
consolidating balance sheet and related statements of operations, stockholders’ equity and cash
flows as of the end of and for such fiscal month and the then elapsed portion
of

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the fiscal year,
setting forth in each case in comparative form the figures for the corresponding period or periods
of (or, in the case of the balance sheet, as of the end of) the previous fiscal year, all certified
by one of its Financial Officers as presenting fairly in all material respects the
financial condition and results of operations of the Company and its consolidated Subsidiaries
on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end
audit adjustments and the absence of footnotes;

          (d) concurrently with any delivery of financial statements under Section 5.1(a), Section
5.1(b) or Section 5.1(c) above, a certificate of a Financial Officer of each of the Borrowers in
substantially the form of Exhibit D (i) certifying, in the case of the financial statements
delivered under Section 5.1(b) or Section 5.1(c), as presenting fairly in all material respects the
financial condition and results of operations of the Company and its consolidated Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit
adjustments and the absence of footnotes, (ii) certifying as to whether a Default has occurred and,
if a Default has occurred, specifying the details thereof and any action taken or proposed to be
taken with respect thereto, (iii) setting forth reasonably detailed calculations demonstrating
compliance with Section 6.1, Section 6.4, Section 6.5, Section 6.7, Section 6.12 and Section 6.13,
and (iv) stating whether any change in GAAP or in the application thereof has occurred since the
date of the audited financial statements referred to in Section 3.4 and, if any such change has
occurred, specifying the effect of such change on the financial statements accompanying such
certificate;

          (e) concurrently with any delivery of financial statements under Section 5.1(a) above, a
certificate of the accounting firm that reported on such financial statements stating whether they
obtained knowledge during the course of their examination of such financial statements of any
Default (which certificate may be limited to the extent required by accounting rules or
guidelines);

          (f) as soon as available, but in any event not more than 60 days prior to nor more than 30
days after the end of each fiscal year of the Company, a copy of the plan and forecast (including a
projected consolidated and consolidating balance sheet, income statement and funds flow statement)
of the Company and its Subsidiaries for each month of the upcoming fiscal year (the
“Projections”) in form reasonably satisfactory to the Administrative Agent;

          (g) as soon as available but in any event within 20 days of the end of each calendar month,
and at such other times as may be necessary to re-determine availability of Advances hereunder or
as may be requested by the Administrative Agent, as of the period then ended, a Borrowing Base
Certificate and supporting information in connection therewith, together with any additional
reports with respect to the Borrowing Base as the Administrative Agent may reasonably request;
provided that at any time Availability is less than $25,000,000, the Administrative
Agent, in its sole discretion, may require the delivery of a Borrowing Base Certificate and
supporting information more often than monthly, including weekly or daily, in which event the
Borrowing Base would be adjusted immediately upon receipt of such reports;

          (h) as soon as available but in any event within 20 days of the end of each calendar month and
at such other times as may be requested by the Administrative Agent, as of

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the period then ended,
all delivered electronically in a text formatted file (not in an Adobe *.pdf file):

          (i) a detailed aging of the Borrowers’ Accounts (A) including all invoices aged by
invoice date and due date (with an explanation of the terms offered) and (B) reconciled to
the Borrowing Base Certificate delivered as of such date prepared in a manner reasonably
acceptable to the Administrative Agent, together with a summary specifying the name,
address, and balance due for each Account Debtor;

          (ii) a schedule detailing the Borrowers’ Inventory, in form satisfactory to the
Administrative Agent, (A) by location (showing Inventory in transit, any Inventory located
with a third party under any consignment, bailee arrangement, or warehouse agreement), by
class (raw material, rental, rolling stock, work-in-process and finished goods), by product
type, and by volume on hand, which Inventory shall be valued at the lower of cost
(determined on a first-in, first-out basis) or market and adjusted for Reserves as the
Administrative Agent has previously indicated to the Borrowers are deemed by the
Administrative Agent to be appropriate, (B) including a report of any variances or other
results of Inventory counts performed by the Borrowers since the last Inventory schedule
(including information regarding sales or other reductions, additions, returns, credits
issued by Borrowers and complaints and claims made against the Borrowers), and (C)
reconciled to the Borrowing Base Certificate delivered as of such date;

          (iii) a worksheet of calculations prepared by the Borrowers to determine Eligible
Accounts and Eligible Inventory, such worksheets detailing the Accounts and Inventory
excluded from Eligible Accounts and Eligible Inventory and the reason for such exclusion;

          (iv) a reconciliation of the Borrowers’ Accounts and Inventory between the amounts
shown in the Borrowers’ general ledger and financial statements and the reports delivered
pursuant to clauses (i) and (ii) above; and

          (v) a reconciliation of the loan balance per the Borrowers’ general ledger to the loan
balance under this Agreement;

          (i) as soon as available but in any event within 3 days of the end of each calendar week and
at such other times as may be requested by the Administrative Agent, as of the calendar week then
ended, a schedule and aging of the Borrowers’ accounts payable, delivered electronically in a text
formatted file (not in an Adobe *.pdf file);

          (j) as soon as available but in any event within 20 days of the end of each calendar month and
at such other times as may be requested by the Administrative Agent, as of the month then ended, a
report of the Borrowers’ rental equipment (including rolling stock), such report detailing all
acquisitions and dispositions since the prior report delivered to the Administrative Agent,
delivered electronically in a text formatted file (not in an Adobe *.pdf file);

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          (k) as soon as available but in any event within 20 days of the end of each calendar month and
at such other times as may be requested by the Administrative Agent,
as of the month then ended, statements of the Borrowers’ lockbox accounts, delivered electronically
in a text formatted file (not in an Adobe *.pdf file);

          (l) as soon as available but in any event within 20 days of the end of each calendar quarter,
as of the quarter then ended, and at such other times as may be requested by the Administrative
Agent, an updated customer list for the Borrowers and their Subsidiaries, which list shall state
the customer’s name, mailing address and phone number and shall be certified as true and correct by
a Financial Officer of each of the Borrowers, such list to be delivered electronically in a text
formatted file (not in an Adobe *.pdf file);

          (m) promptly upon the Administrative Agent’s request:

          (i) copies of invoices in connection with the invoices issued by the Borrowers in
connection with any Accounts, credit memos, shipping and delivery documents, and other
information related thereto;

          (ii) copies of purchase orders, invoices, and shipping and delivery documents in
connection with any Inventory or Equipment purchased by any Loan Party; and

          (iii) a schedule detailing the balance of all intercompany accounts of the Loan
Parties;

          (n) as soon as available but in any event within 20 days of the end of each calendar week and
at such other times as may be requested by the Administrative Agent, as of the period then ended,
the Borrowers’ sales journal, cash receipts journal (identifying trade and non-trade cash receipts)
and debit memo/credit memo journal;

          (o) as soon as possible and in any event within 20 days of filing thereof, copies of all tax
returns filed by any Loan Party with the U.S. Internal Revenue Service;

          (p) within 20 days of the first Business Day of each March and September, a certificate of
good standing for each Loan Party from the appropriate governmental officer in its jurisdiction of
incorporation, formation, or organization;

          (q) as soon as available but in any event within 20 days of the end of each calendar month, a
Perfection Certificate Update prepared as of the close of business on the last Business Day of the
preceding calendar month;

          (r) promptly following any request therefor, such other information regarding the operations,
business affairs and financial condition of each of the Borrowers or any of their Subsidiaries, or
compliance with the terms of this Agreement, as the Administrative Agent or any Lender may
reasonably request.

     Section 5.2
Notices of Material Events. The Borrowers will furnish to the Administrative Agent and
each Lender prompt written notice of the following:

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          (a) the occurrence of any Default;

          (b) receipt of any notice of any governmental investigation or any litigation or proceeding
commenced or threatened against any Loan Party that (i) seeks damages in excess of $5,000,000, (ii)
seeks injunctive relief, (iii) is asserted or instituted against any Plan, its fiduciaries or its
assets, (iv) alleges criminal misconduct by any Loan Party, (v) alleges the violation of any law
regarding, or seeks remedies in connection with, any Environmental Laws, (vi) contests any tax,
fee, assessment, or other governmental charge in excess of $1,000,000, or (vii) involves any
product recall;

          (c) incurrence of any Lien (other than Permitted Encumbrances) or claim made or asserted
against any of the Collateral;

          (d) any loss, damage, or destruction to the Collateral in the amount of $2,500,000 or more,
whether or not covered by insurance;

          (e) any and all default notices received under or with respect to any leased location or
public warehouse where Collateral is located (which shall be delivered within two Business Days
after receipt thereof);

          (f) all material amendments to the agreements and contracts listed on Schedule 3.12,
together with a copy of each such amendment;

          (g) the fact that a Loan Party has entered into a Swap Agreement or an amendment to a Swap
Agreement, together with copies of all agreements evidencing such Swap Agreement or amendments
thereto (which shall be delivered within two Business Days);

          (h) the occurrence of any ERISA Event that, alone or together with any other ERISA Events that
have occurred, could reasonably be expected to result in liability of the Borrowers and their
Subsidiaries in an aggregate amount exceeding $1,000,000; and

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

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

     Section 5.3
Existence; Conduct of Business. Each Loan Party will, and will cause each Subsidiary to,
(a) do or cause to be done all things necessary to preserve, renew and keep in full force and
effect its legal existence and the rights, qualifications, licenses, permits, franchises,
governmental authorizations, intellectual property rights, licenses and permits material to the
conduct of its business, and maintain all requisite authority to conduct its business in each
jurisdiction in which its business is conducted, where the failure to perform such obligations,
individually or in the aggregate, could not reasonably be expected to result in a Material Adverse
Effect; provided that the foregoing shall not prohibit any merger, consolidation,
liquidation or

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dissolution permitted under Section 6.3 and (b) carry on and conduct its business in
substantially the same manner and in substantially the same fields of enterprise as it is presently
conducted.

     Section
5.4 Payment of Obligations. Each Loan Party will, and will cause each Subsidiary to, pay or
discharge all Material Indebtedness and all other material liabilities and obligations, including
Taxes, before the same shall become delinquent or in default, except where (a) the validity or
amount thereof is being contested in good faith by appropriate proceedings, (b) such Loan Party or
such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance
with GAAP, and (c) none of the Collateral becomes subject to forfeiture or loss as a result of the
contest.

     Section 5.5
Maintenance of Properties. Each Loan Party will, and will cause each Subsidiary to, keep
and maintain all property material to the conduct of its business in good working order and
condition, ordinary wear and tear excepted.

     Section 5.6
Books and Records; Inspection Rights. Each Loan Party will, and will cause each Subsidiary
to, (a) keep proper books of record and account in which full, true and correct entries are made of
all dealings and transactions in relation to its business and activities and (b) permit any
representatives designated by any Agent or any Lender (including employees of any Agent, any Lender
or any consultants, accountants, lawyers and appraisers retained by any Agent), upon reasonable
prior notice, to visit and inspect its properties, to examine and make extracts from its books and
records, including environmental assessment reports and Phase I or Phase II studies, and to discuss
its affairs, finances and condition with its officers and independent accountants, all at such
reasonable times and as often as reasonably requested. After the occurrence and during the
continuance of any Event of Default, each Loan Party shall provide each Agent and each Lender with
access to its suppliers. The Loan Parties acknowledge that any Agent, after exercising its rights
of inspection, may prepare and distribute to the Lenders certain Reports pertaining to the Loan
Parties’ assets for internal use by the Agents and the Lenders.

     Section 5.7
Compliance with Laws. Each Loan Party will, and will cause each Subsidiary to, comply in
all material respects with all Requirements of Law applicable to it or its property.

     Section 5.8
Use of Proceeds. The proceeds of the Revolving Loans will be used only to finance the
working capital needs of the Borrowers, for general corporate purposes of the Borrowers and their
Subsidiaries in the ordinary course of business, to finance the Closing Date Acquisition (as
defined in the Existing Credit Agreement) and expenses incurred in connection therewith and other
uses acceptable to the Administrative Agent. No part of the proceeds of any Loan and no Letter of
Credit will be used, whether directly or indirectly, for any purpose that entails a violation of
any of the Regulations of the Board, including Regulations T, U and X.

     Section 5.9
Insurance. Each Loan Party will, and will cause each Subsidiary to, maintain with
financially sound and reputable carriers having a financial strength rating of at least A by A.M.
Best Company (a) insurance in such amounts (with no greater risk retention) and against such risks
(including loss or damage by fire and loss in transit; theft, burglary, pilferage, larceny,
embezzlement, and other criminal activities; business interruption; and general liability)

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and such
other hazards, as is customarily maintained by companies of established repute engaged in the same
or similar businesses operating in the same or similar locations and (b) all insurance
required pursuant to the Collateral Documents. The Borrowers will furnish to the Lenders, upon request of
any Agent, information in reasonable detail as to the insurance so maintained.

     Section 5.10
Casualty and Condemnation. The Borrowers (a) will furnish to the Agents and the Lenders
prompt written notice of any casualty or other insured damage to any material portion of the
Collateral or the commencement of any action or proceeding for the taking of any material portion
of the Collateral or interest therein under power of eminent domain or by condemnation or similar
proceeding and (b) will ensure that the Net Proceeds of any such event (whether in the form of
insurance proceeds, condemnation awards or otherwise) are collected and applied in accordance with
the applicable provisions of this Agreement and the Collateral Documents.

     Section 5.11
Field Examinations. At any time that the Administrative Agent requests, the Borrowers and
the Subsidiaries will provide the Administrative Agent, at the sole expense of the Borrowers,
reports of a collateral field examiner approved by the Administrative Agent (which may be the
Administrative Agent or an affiliate thereof) with respect to all of the components of the
Borrowing Base and such other matters regarding the Loan Parties or the Collateral as the
Administrative Agent shall reasonably require. Without limiting the foregoing right of the
Administrative Agent to require a field examination/borrowing base audit at any time, as of the
date of this Agreement it is anticipated that one field examination/borrowing base audit per fiscal
year will be conducted. The Borrowers shall pay all costs for each examination required pursuant
to this Section 5.11 (including, without limitation, all reasonable travel and out of pocket costs)
in accordance with the Administrative Agent’s, such Affiliates’ or any such third party’s fee
schedule in effect from time to time.

     Section 5.12
Appraisals. At any time that the Administrative Agent requests, the Borrowers and the
Subsidiaries will provide the Administrative Agent with appraisals or updates thereof of their
Inventory, including, without limitation, Inventory consisting of rental equipment and rolling
stock, from an appraiser selected and engaged by the Administrative Agent, and prepared on a basis
satisfactory to the Administrative Agent, such appraisals and updates to include, without
limitation, information required by applicable law and regulations. Without limiting the foregoing
right of the Administrative Agent to require an inventory appraisal at any time, as of the date of
this Agreement it is anticipated that one inventory appraisal per fiscal year will be conducted.

     Section 5.13
Depository Bank. The Borrowers and each Subsidiary will maintain the Administrative Agent
as its principal depository bank, including for the maintenance of operating, administrative, cash
management, collection activity, and other deposit accounts for the conduct of its business.

     Section 5.14 Additional Collateral; Further Assurances.

          (a) Subject to applicable law, the Borrowers and each Subsidiary that is a Loan Party shall
cause each of its domestic Subsidiaries formed or acquired after the date of this Agreement in
accordance with the terms of this Agreement to become a Loan Party by executing

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the Joinder
Agreement set forth as Exhibit E hereto (the “Joinder Agreement”). Upon execution
and delivery thereof, each such Person (i) shall automatically become a Loan
 Guarantor hereunder and thereupon shall have all of the rights, benefits, duties, and obligations
in such capacity under the Loan Documents and (ii) will grant Liens to the Collateral Agent, for
the benefit of the Agents, the Lenders and the Other Secured Parties, in any property of such Loan Party which constitutes Collateral, including any parcel of Real Property located in the
U.S. owned by any Loan Party.

          (b) The Borrowers and each Subsidiary that is a Loan Party will cause (i) 100% of the issued
and outstanding Equity Interests in each of its domestic Subsidiaries and (ii) 65% (or such greater
percentage that, due to a change in applicable law after the date hereof, (A) could not reasonably
be expected to cause the undistributed earnings of such foreign Subsidiary as determined for U.S.
federal income tax purposes to be treated as a deemed dividend to such foreign Subsidiary’s U.S.
parent and (B) could not reasonably be expected to cause any material adverse tax consequences) of
the issued and outstanding Equity Interests entitled to vote (within the meaning of Treas. Reg.
Section 1.956-2(c)(2)) and 100% of the issued and outstanding Equity Interests not entitled to vote
(within the meaning of Treas. Reg. Section 1.956-2(c)(2) in each foreign Subsidiary directly owned
by any Borrower or any domestic Subsidiary to be subject at all times to a first priority,
perfected Lien in favor of the Collateral Agent pursuant to the terms and conditions of the Loan
Documents or other security documents as the Collateral Agent shall reasonably request.

          (c) Without limiting the foregoing, each Loan Party will, and will cause each Subsidiary to,
execute and deliver, or cause to be executed and delivered, to the Collateral Agent such documents,
agreements and instruments, and will take or cause to be taken such further actions (including the
filing and recording of financing statements, fixture filings, mortgages, deeds of trust and other
documents and such other actions or deliveries of the type required by Section 4.1, as applicable),
which may be required by law or which Collateral Agent may, from time to time, reasonably request
to carry out the terms and conditions of this Agreement and the other Loan Documents and to ensure
perfection and priority of the Liens created or intended to be created by the Collateral Documents,
all at the expense of the Loan Parties. Notwithstanding the foregoing, at any time after an Event
of Default has occurred, each Loan Party will, upon the request of the Administrative Agent, cause
each foreign Subsidiary to become a Loan Party and a Loan Guarantor and to grant Liens to the
Collateral Agent on its assets and have the balance of its Equity Interests pledged to the
Collateral Agent.

          (d) If any material assets (including any Real Property or improvements thereto or any
interest therein) are acquired by the Borrowers or any Subsidiary that is a Loan Party after the
Effective Date (other than assets constituting Collateral under the Security Agreement that become
subject to the Lien in favor of the Security Agreement upon acquisition thereof), the Borrowers
will notify the Administrative Agent and the Lenders thereof, and, if requested by the
Administrative Agent or the Required Lenders, the Borrowers will cause such assets to be subjected
to a Lien securing the Secured Obligations and will take, and cause the Subsidiary Loan Parties to
take, such actions as shall be necessary or reasonably requested by the Collateral Agent to grant
and perfect such Liens, including actions described in Section 5.14(c), all at the expense of the
Loan Parties.

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ARTICLE VI

NEGATIVE COVENANTS

     Until the Commitments have expired or terminated and the principal of and interest on each
Loan and all fees, expenses and other amounts payable under any Loan Document have been paid in
full and all Letters of Credit have expired or terminated and all LC Disbursements shall have been
reimbursed, the Loan Parties covenant and agree, jointly and severally, with the Lenders that:

     Section 6.1 Indebtedness. No Loan Party will, nor will it permit any Subsidiary to,
create, incur or suffer to exist any Indebtedness, except:

          (a) the Secured Obligations;

          (b) Indebtedness existing on the date hereof and set forth in Schedule 6.1 and
extensions, renewals and replacements of any such Indebtedness in accordance with Section 6.1(f)
hereof;

          (c) Indebtedness of any Borrower to any Subsidiary and of any Subsidiary to any Borrower or
any other Subsidiary, provided that (i) Indebtedness of any Subsidiary that is not
a Loan Party to a Borrower or any Subsidiary that is a Loan Party shall be subject to Section 6.4
and (ii) Indebtedness of any Borrower to any Subsidiary and Indebtedness of any Subsidiary that is
a Loan Party to any Subsidiary that is not a Loan Party shall be subordinated to the Secured
Obligations on terms reasonably satisfactory to the Administrative Agent;

          (d) Guarantees by the Borrowers of Indebtedness of any Subsidiary and by any Subsidiary of
Indebtedness of a Borrower or any other Subsidiary, provided that (i) the
Indebtedness so Guaranteed is permitted by this Section 6.1, (ii) Guarantees by the Borrowers or
any Subsidiary that is a Loan Party of Indebtedness of any Subsidiary that is not a Loan Party
shall be subject to Section 6.4 and (iii) Guarantees permitted under this Section 6.1(d) shall be
subordinated to the Secured Obligations of the applicable Subsidiary on the same terms as the
Indebtedness so Guaranteed is subordinated to the Secured Obligations;

          (e) Indebtedness of the Borrowers or any Subsidiary incurred to finance the acquisition,
construction or improvement of any fixed or capital assets (whether or not constituting purchase
money Indebtedness), including Capital Lease Obligations and any Indebtedness assumed in connection
with the acquisition of any such assets or secured by a Lien on any such assets prior to the
acquisition thereof, and extensions, renewals and replacements of any such Indebtedness in
accordance with Section 6.1(f) hereof; provided that (i) such Indebtedness is
incurred prior to or within 90 days after such acquisition or the completion of such construction
or improvement, and (ii) the aggregate principal amount of Indebtedness permitted by this Section
6.1(e) shall not exceed $25,000,000 at any time outstanding;

          (f) Indebtedness which represents an extension, refinancing, or renewal of any of the
Indebtedness described in Section 6.1(b) and Section 6.1(e) hereof; provided that,
(i) any Liens securing such Indebtedness are not extended to any additional property of any Loan
Party, (ii) no Loan Party that is not originally obligated with respect to repayment of such

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Indebtedness
is required to become obligated with respect thereto, (iii) such extension, refinancing or renewal does not result in a shortening of the average weighted maturity of the
Indebtedness so extended, refinanced or renewed, (iv) the terms of any such extension, refinancing,
or renewal are not less favorable to the obligor thereunder than the original terms of such
Indebtedness and (v) if the Indebtedness that is refinanced, renewed, or extended was subordinated
in right of payment to the Secured Obligations, then the terms and conditions of the refinancing,
renewal, or extension Indebtedness must include subordination terms and conditions that are at
least as favorable to the Administrative Agent and the Lenders as those that were applicable to the
refinanced, renewed, or extended Indebtedness;

          (g) Indebtedness owed to any person providing workers’ compensation, health, disability or
other employee benefits or property, casualty or liability insurance, pursuant to reimbursement or
indemnification obligations to such person, in each case incurred in the ordinary course of
business;

          (h) Indebtedness of the Borrowers or any Subsidiary in respect of performance bonds, bid
bonds, appeal bonds, surety bonds and similar obligations, in each case provided in the ordinary
course of business;

          (i) Indebtedness evidenced by the Senior Notes and Guarantees in respect of the Indebtedness
evidenced by the Senior Notes; provided that such Senior Notes are not guaranteed
by any Subsidiary of any Borrower which is not either a Borrower or a Loan Guarantor which has
guaranteed the Obligations pursuant to the Loan Guaranty;

          (j) Indebtedness consisting of advance payments by customers under purchase contracts in the
ordinary course of business of the Borrowers;

          (k) Indebtedness secured by Liens described in Section 6.2(e) but not exceeding an aggregate
amount of $2,000,000 outstanding at any time;

          (l) Indebtedness incurred in connection with financing of Real Estate owned by a Borrower and
described in Schedule 1.1, together with the fixtures thereon, or of Equipment owned by a
Borrower, in an aggregate principal amount outstanding at any time not to exceed 85% of the fair
value of all such Real Estate and Equipment; and

          (m) other unsecured Indebtedness in an aggregate principal amount not exceeding $20,000,000 at
any time outstanding; provided that the aggregate principal amount of Indebtedness
of the Borrowers’ Subsidiaries permitted by this Section 6.1(m) shall not exceed $20,000,000 at any
time outstanding.

     Section 6.2 Liens. No Loan Party will, nor will it permit any Subsidiary to, create,
incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired
by it, or assign or sell any income or revenues (including accounts receivable) or rights in
respect of any thereof, except:

          (a) Liens created pursuant to any Loan Document;

          (b) Permitted Encumbrances;

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          (c) any Lien on any property or asset of the Borrowers or any Subsidiary existing on the date
hereof and set forth in Schedule 6.2; provided that (i) such Lien shall not
apply to any other property or asset of the Borrowers or Subsidiary and (ii) such Lien shall secure
only those obligations which it secures on the date hereof and extensions, renewals and
replacements thereof that do not increase the outstanding principal amount thereof;

          (d) Liens on fixed or capital assets acquired, constructed or improved by the Borrowers or any
Subsidiary (which shall expressly exclude rental equipment); provided that (i) such
security interests secure Indebtedness permitted by Section 6.1(e), (ii) such security interests
and the Indebtedness secured thereby are incurred prior to or within 90 days after such acquisition
or the completion of such construction or improvement, (iii) the Indebtedness secured thereby does
not exceed 100% of the cost of acquiring, constructing or improving such fixed or capital assets
and (iv) such security interests shall not apply to any other property or assets of the Borrowers
or Subsidiary;

          (e) any Lien existing on any property or asset (other than Accounts and Inventory) prior to
the acquisition thereof by the Borrowers or any Subsidiary or existing on any property or asset
(other than Accounts and Inventory) of any Person that becomes a Loan Party after the date hereof
prior to the time such Person becomes a Loan Party; provided that (i) such Lien is
not created in contemplation of or in connection with such acquisition or such Person becoming a
Loan Party, as the case may be, (ii) such Lien shall not apply to any other property or assets of
the Loan Party and (iii) such Lien shall secure only those obligations which it secures on the date
of such acquisition or the date such Person becomes a Loan Party, as the case may be and
extensions, renewals and replacements thereof that do not increase the outstanding principal amount
thereof;

          (f) Liens of a collecting bank arising in the ordinary course of business under Section 4.208
of the Uniform Commercial Code in effect in the relevant jurisdiction covering only the items being
collected upon;

          (g) Liens on Real Estate described in Schedule 1.1, together with the fixtures
thereon, and on Equipment, in each case arising out of sale and leaseback transactions permitted by
Section 6.6 or financing transactions permitted by Section 6.1(l); and

          (h) Liens granted by a Subsidiary that is not a Loan Party in favor of the Borrowers or
another Loan Party in respect of Indebtedness owed by such Subsidiary.

Notwithstanding the foregoing, none of the Liens permitted pursuant to this Section 6.2 may at any
time attach to any Loan Party’s (i) Accounts, other than those permitted under clause (a) of the
definition of Permitted Encumbrance and Section 6.2(a) above and (ii) Inventory, other than
Permitted Senior Encumbrances and Section 6.2(a) above.

     Section 6.3 Fundamental Changes.

          (a) No Loan Party will, nor will it permit any Subsidiary to, merge into or consolidate with
any other Person, or permit any other Person to merge into or consolidate with it, or liquidate or
dissolve, except that, if at the time thereof and immediately after giving effect

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thereto no Event
of Default shall have occurred and be continuing (i) any
Borrower and any Subsidiary of a Borrower may merge into a Borrower in a transaction in which a Borrower is the
surviving Person, provided that if one of the parties is the Company, the Company is the surviving
Person, (ii) any Loan Party (other than a Borrower) may merge into any Loan Party in a transaction
in which the surviving entity is a Loan Party and (iii) any Subsidiary that is not a Loan Party may
liquidate or dissolve if the Borrowers determine in good faith that such liquidation or dissolution
is in the best interests of the Borrowers and is not materially disadvantageous to the Lenders;
provided that any such merger involving a Person that is not a wholly owned
Subsidiary immediately prior to such merger shall not be permitted unless also permitted by Section
6.4.

          (b) No Loan Party will, nor will it permit any of its Subsidiaries to, engage in any business
other than businesses of the type conducted by the Borrowers and their Subsidiaries on the date of
execution of this Agreement and businesses reasonably related thereto.

          (c) No Loan Party will change the end of its fiscal year to be something other than the last
day of January of each year.

     Section 6.4 Investments, Loans, Advances, Guarantees and Acquisitions. No Loan Party will,
nor will it permit any Subsidiary to, purchase, hold or acquire (including pursuant to any merger
with any Person that was not a Loan Party and a wholly owned Subsidiary prior to such merger) any
capital stock, evidences of indebtedness or other securities (including any option, warrant or
other right to acquire any of the foregoing) of, make or permit to exist any loans or advances to,
Guarantee any obligations of, or make or permit to exist any investment or any other interest in,
any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions)
any assets of any other Person constituting a business unit (whether through purchase of assets,
merger or otherwise), except:

          (a) Permitted Investments, subject to control agreements in favor of the Collateral Agent for
the benefit of the Lenders or otherwise subject to a perfected security interest in favor of the
Collateral Agent for the benefit of the Lenders;

          (b) investments in existence on the date of this Agreement and described in Schedule
6.4;

          (c) investments by any Borrower and the Subsidiaries in Equity Interests in their respective
Subsidiaries, provided that (i) any such Equity Interests held by a Loan Party
shall be pledged pursuant to the Security Agreement (subject to the limitations applicable to
common stock of a foreign Subsidiary referred to in Section 5.13) and (ii) the aggregate amount of
investments by Loan Parties in Subsidiaries that are not Loan Parties (together with outstanding
intercompany loans permitted under Section 6.4(d)(ii) and outstanding Guarantees permitted under
the proviso to Section 6.4(e)) shall not exceed $10,000,000 at any time outstanding (in each case
determined without regard to any write-downs or write-offs);

          (d) loans or advances made by any Borrower to any Subsidiary and made by any Subsidiary to any
Borrower or any other Subsidiary, provided that (i) any such loans and advances
made by a Loan Party shall be evidenced by a promissory note pledged pursuant to the

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Security
Agreement and (ii) the amount of such loans and advances made by
Loan Parties to Subsidiaries that are not Loan Parties (together with outstanding investments permitted under
Section 6.4(c)(ii) and outstanding Guarantees permitted under the proviso to Section 6.4(e)) shall
not exceed $10,000,000 at any time outstanding (in each case determined without regard to any
write-downs or write-offs);

          (e) Guarantees constituting Indebtedness permitted by Section 6.1, provided
that the aggregate principal amount of Indebtedness of Subsidiaries that are not Loan
Parties that is Guaranteed by any Loan Party shall (together with outstanding investments permitted
under Section 6.4(c)(ii) and outstanding intercompany loans permitted under Section 6.4(d)(ii))
shall not exceed $10,000,000 at any time outstanding (in each case determined without regard to any
write-downs or write-offs);

          (f) loans or advances made by a Loan Party to its employees on an arms-length basis in the
ordinary course of business consistent with past practices for travel and entertainment expenses,
relocation costs and similar purposes up to a maximum of $1,000,000 to any employee and up to a
maximum of $5,000,000 in the aggregate at any one time outstanding;

          (g) subject to Sections 4.2(a) and 4.4 of the Pledge and Security Agreement, notes payable, or
stock or other securities issued by Account Debtors to a Loan Party pursuant to negotiated
agreements with respect to settlement of such Account Debtor’s Accounts in the ordinary course of
business, consistent with past practices;

          (h) investments in the form of Swap Agreements permitted by Section 6.7;

          (i) investments of any Person existing at the time such Person becomes a Subsidiary of a
Borrower or consolidates or merges with a Borrower or any of the Subsidiaries (including in
connection with a Permitted Acquisition) so long as such investments were not made in contemplation
of such Person becoming a Subsidiary or of such merger;

          (j) accounts receivable, security deposits and prepayments arising and trade credit granted in
the ordinary course of business and any assets or securities, in each case, received in
satisfaction or partial satisfaction thereof from financially troubled account debtors to the
extent reasonably necessary in order to prevent or limit loss and any prepayments and other credits
to suppliers made in the ordinary course of business;

          (k) investments constituting Permitted Acquisitions; provided, that no investment, loan or
advance in or to any Person created or acquired pursuant to such Permitted Acquisition which is not
a Loan Party will be permitted except to the extent such Investment is permitted pursuant to
Section 6.4(c) or (d), as applicable;

          (l) investments received in connection with the dispositions of assets permitted by Section
6.5; and

          (m) investments constituting deposits described in clauses (c) and (d) of the definition of
the term “Permitted Encumbrances.”

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     Section 6.5 Asset Sales. No Loan Party will, nor will it permit any Subsidiary to, sell,
transfer, lease or otherwise dispose of any asset, including any Equity Interest owned by it, nor
will the Borrowers permit any Subsidiary to issue any additional Equity Interest in such Subsidiary
(other than to a Borrower or another Subsidiary in compliance with Section 6.4), except:

          (a) sales, transfers and dispositions of (i) inventory in the ordinary course of business and
(ii) used, obsolete, worn out or surplus equipment or property in the ordinary course of business;

          (b) sales, transfers and dispositions to any Borrower or any Subsidiary, provided
that any such sales, transfers or dispositions involving a Subsidiary that is not a Loan
Party shall be made in compliance with Section 6.9;

          (c) sales, transfers and dispositions of accounts receivable in connection with the
compromise, settlement or collection thereof;

          (d) sales, transfers and dispositions of Permitted Investments in the ordinary course of
business and investments permitted by Section 6.4(i) and Section 6.4(m);

          (e) sale and leaseback transactions permitted by Section 6.6;

          (f) dispositions resulting from any casualty or other insured damage to, or any taking under
power of eminent domain or by condemnation or similar proceeding of, any property or asset of any
Borrower or any Subsidiary;

          (g) sales, transfers and other dispositions of assets (other than Equity Interests in a
Subsidiary unless all Equity Interests in such Subsidiary are sold) that are not permitted by any
other paragraph of this Section, provided that the aggregate fair market value of
all assets sold, transferred or otherwise disposed of in reliance upon this Section 6.5(g) shall
not exceed $5,000,000 during any fiscal year of the Company; and

          (h) dispositions of Real Property described on Schedule 1.1, together with fixtures
thereon, or Equipment so long as at the time of any such sale and immediately after giving effect
thereto no Event of Default shall have occurred and be continuing;

provided that all sales, transfers, leases and other dispositions permitted hereby
(other than those permitted by Section 6.5(b) and Section 6.5(f) above) shall be made for fair
value and for only cash consideration, provided, that, sale and leaseback
transactions permitted under Section 6.5(h) and Section 6.6 shall be made for cash consideration in
an amount not less than 85% of the fair value of such fixed or capital asset.

     Section 6.6 Sale and Leaseback Transactions. No Loan Party will, nor will it permit any
Subsidiary to, enter into any arrangement, directly or indirectly, whereby it shall sell or
transfer any property, real or personal, used or useful in its business, whether now owned or
hereafter acquired, and thereafter rent or lease such property or other property that it intends to
use for substantially the same purpose or purposes as the property sold or transferred, except for
Permitted Fixed Asset Dispositions or any sale of any other fixed or capital assets by any

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Borrower or any Subsidiary that is made for cash consideration in an amount not less than 85% of the fair
value of such fixed or capital asset.

     Section 6.7 Swap Agreements. No Loan Party will, nor will it permit any Subsidiary to,
enter into any Swap Agreement, except (a) Swap Agreements entered into to hedge or mitigate risks
to which the Loan Parties have actual exposure (other than those in respect of Equity Interests in
any Borrower or any of its Subsidiaries), and (b) Swap Agreements entered into in order to
effectively cap, collar or exchange interest rates (from fixed to floating rates, from one floating
rate to another floating rate or otherwise) with respect to any interest-bearing liability or
investment of any Loan Party.

     Section 6.8 Restricted Payments; Certain Payments of Indebtedness.

          (a) No Loan Party will, nor will it permit any Subsidiary to, declare or make, or agree to pay
or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or
otherwise) to do so, except (i) each Borrower may declare and pay dividends with respect to its
Equity Interests payable solely in additional Equity Interests, (ii) Subsidiaries may declare and
pay dividends ratably with respect to their Equity Interests, (iii) so long as there exists no
Default or Event of Default, the Borrowers may make Restricted Payments, not exceeding $1,000,000
during any fiscal year, pursuant to and in accordance with Equity Interest option plans or other
benefit plans for management or employees of the Borrowers and their Subsidiaries, (iv) so long as
there exists no Default or Event of Default and the Company is a “flow through” entity for United
States federal income tax purposes, the Company may pay dividends or make distributions to its
members in an aggregate amount not greater than the amount necessary for such members to pay their
actual state and United States federal, state and local income tax liabilities in respect of income
earned by the Borrowers, and (v) the Company shall be permitted to pay dividends and distributions;
provided, that such dividends and distribution shall only be permitted if (1) there
exists no Default or Event of Default, (2) the Fixed Charge Coverage Ratio for the Borrowers (after
giving effect to such dividend and distribution) would not be less than 1.25 to 1 for the most
recently completed twelve month period (or, if prior to January 31, 2007, for the period of
calendar months ended after January 31, 2006 for which monthly financial statements are required to
be delivered pursuant to Section 5.1(c)) assuming that for purposes of calculating the Fixed Charge
Coverage Ratio for such period (calculated on a pro forma basis in a manner acceptable to the
Administrative Agent) such dividends and distributions occurred on the first day of such applicable
period, and (3) immediately after giving effect to the payment of any such dividends and
distributions and for the next succeeding twelve month period, Availability will not be less than
$30,000,000 on a pro forma basis (calculated in a manner acceptable to the Administrative Agent and
assuming all past due accounts payable of the Borrowers have been paid in full in cash at the time
of such payment and no accounts payable of the Borrowers are allowed to become past due during such
twelve month period thereafter).

          (b) No Loan Party will, nor will it permit any Subsidiary to, make or agree to pay or make,
directly or indirectly, any payment or other distribution (whether in cash, securities or other
property) of or in respect of principal of or interest on any Indebtedness, or any payment or other
distribution (whether in cash, securities or other property),
including any sinking fund or

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similar
deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or
termination of any Indebtedness, except:

          (i) payment of Indebtedness created under the Loan Documents;

          (ii) payment of regularly scheduled interest and principal payments as and when due in
respect of any Indebtedness, other than payments in respect of the Subordinated Indebtedness
prohibited by the subordination provisions thereof;

          (iii) refinancings of Indebtedness to the extent permitted by Section 6.1; and

          (iv) payment of secured Indebtedness that becomes due as a result of the voluntary sale
or transfer of the property or assets securing such Indebtedness.

     Section 6.9 Transactions with Affiliates. No Loan Party will, nor will it permit any
Subsidiary to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or
otherwise acquire any property or assets from, or otherwise engage in any other transactions with,
any of its Affiliates, except (a) transactions that (i) are in the ordinary course of business and
(ii) are at prices and on terms and conditions not less favorable to the Borrower or such
Subsidiary than could be obtained on an arm’s-length basis from unrelated third parties, (b)
transactions between or among any Borrower and any Subsidiary that is a Loan Party not involving
any other Affiliate, (c) any investment permitted by Section 6.4(c) or Section 6.4(d), (d) any
Indebtedness permitted under Section 6.1(c), (e) any Restricted Payment permitted by Section 6.8,
(f) loans or advances to employees permitted under Section 6.4, (g) the payment of reasonable fees
to directors or managers of any Borrower or any Subsidiary who are not employees of any Borrower or
any Subsidiary, and compensation and employee benefit arrangements paid to, and indemnities
provided for the benefit of, directors, officers or employees of the Borrowers or their
Subsidiaries in the ordinary course of business, (h) any issuances of securities or other payments,
awards or grants in cash, securities or otherwise pursuant to, or the funding of, employment
agreements, stock options and stock ownership plans approved by any Borrower’s board of directors
or managers, as applicable, (i) payment of compensation to Mr. Hushang Ansary in an aggregate
amount of up to $2,500,000 per fiscal year plus reimbursement of all reasonable and customary
business expenses of Mr. Hushang Ansary related to the Borrowers.

     Section 6.10 Restrictive Agreements. No Loan Party will, nor will it permit any Subsidiary
to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement
that prohibits, restricts or imposes any condition upon (a) the ability of such Loan Party or any
of its Subsidiaries to create, incur or permit to exist any Lien upon any of its property or
assets, or (b) the ability of any Subsidiary to pay dividends or other distributions with respect
to any of its Equity Interests or to make or repay loans or advances to the Borrowers or any other
Subsidiary or to Guarantee Indebtedness of the Borrowers or any other Subsidiary; provided
that (i) the foregoing shall not apply to restrictions and conditions imposed by law or by
any Loan Document, (ii) the foregoing shall not apply to restrictions and conditions existing on
the date hereof identified on Schedule 6.10 (but shall apply to any extension or renewal
of, or any amendment or modification expanding the scope of, any such restriction or condition),

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(iii) the foregoing shall not apply to customary restrictions and conditions contained in
agreements relating to the sale of a Subsidiary pending such sale, provided such restrictions and
conditions apply only to the Subsidiary that is to be sold and such sale is permitted hereunder,
(iv) Section 6.10(a) of the foregoing shall not apply to restrictions or conditions imposed by any
agreement relating to secured Indebtedness permitted by this Agreement if such restrictions or
conditions apply only to the property or assets securing such Indebtedness and (v) Section 6.10(a)
of the foregoing shall not apply to customary provisions in leases and other contracts restricting
the assignment thereof.

     Section 6.11 Amendment of Material Documents. No Loan Party will, nor will it permit any
Subsidiary to, amend, modify or waive any of its rights under (a) any agreement relating to any
Subordinated Indebtedness, (b) its certificate of incorporation, by-laws, operating, management or
partnership agreement or other organizational documents, (c) the Acquisition Documents or (d) any
document, instrument or agreement described on Schedule 3.12 or any document, instrument or
agreement executed in connection therewith or pursuant thereto (i) without providing to
Administrative Agent at least ten (10) Business Days’ written notice thereof describing in
reasonable detail the proposed amendment, modification or waiver, and (ii) to the extent any such
amendment, modification or waiver would be adverse to the Lenders or otherwise material.

     Section 6.12 Operating Leases. The Borrowers will not, nor will they permit any Subsidiary
to, incur, create, assume or become liable as a lessee, or permit any other Loan Party to incur,
create, assume or become liable as a lessee, under any lease, sublease, license or similar
arrangement (other than related to Capital Lease Obligations) pursuant to which a Person leases,
subleases, licenses or otherwise is granted the right to occupy, take possession of, or use
Property, other than such leases, subleases, licenses or other arrangements created in the normal
course of business consistent with past practices which would not result in the Borrowers and their
Subsidiaries’ annual lease expense exceeds $30,000,000.

     Section 6.13 Fixed Charge Coverage Ratio. The Borrowers will not permit the Fixed Charge
Coverage Ratio to be less than 1.1 to 1.0 for any period of four consecutive fiscal quarters ending
on the last day of each such period; provided that, for such periods ending August
5, 2006 and November 4, 2006, the applicable test period shall be the period of two and three
fiscal quarters then ended respectively; provided further that, this
covenant shall only be applicable for such periods ending during any Activation Period and for such
periods ending on the last day of the fiscal quarter ending immediately prior to any Activation
Period.

     Section 6.14 Limitations on Inter-Borrower Transactions. Notwithstanding anything to the
contrary contained in any other provision of this Agreement or any other Loan Document, (a) no
Borrower, other than SSPP, shall be permitted to make Borrowings hereunder, and no Letters of
Credit shall be issued which are directly or indirectly for the account of any Borrower other than
SSPP (collectively, “non SSPP Borrowings”), and (b) SSPP shall not make any dividend,
distribution, intercompany loan or advance or equity contribution, or make any other transfer,
whether in cash, securities or property to any other Borrower, and SSPP shall not guaranty,
directly or indirectly, any Indebtedness or other obligation of any other Borrower (any such
dividend, distribution, intercompany loan or advance, equity contribution, transfer, or guaranty, a
“Financial Accommodation”), unless, after giving effect thereto, the Adjusted Net

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Worth of
SSPP would be not less than $50,000,000. Not less than ten (10) Business Days prior to making any
non SSPP Borrowings the Borrowers shall provide to the Administrative Agent a certificate of a
Financial Officer of the Borrowers confirming compliance with this covenant.

ARTICLE VII

EVENTS OF DEFAULT

     If any of the following events (“Events of Default”) shall occur:

          (a) the Borrowers shall fail to pay any principal of any Loan or any reimbursement obligation
in respect of any LC Disbursement when and as the same shall become due and payable, whether at the
due date thereof or at a date fixed for prepayment thereof or otherwise;

          (b) the Borrowers shall fail to pay any interest on any Loan or any fee or any other amount
(other than an amount referred to in clause (a) of this Article) payable under this Agreement, when
and as the same shall become due and payable;

          (c) any representation or warranty made or deemed made by or on behalf of any Loan Party or
any Subsidiary in or in connection with this Agreement or any Loan Document or any amendment or
modification thereof or waiver thereunder, or in any report, certificate, financial statement or
other document furnished pursuant to or in connection with this Agreement or any Loan Document or
any amendment or modification thereof or waiver thereunder, shall prove to have been materially
incorrect when made or deemed made;

          (d) any Loan Party shall fail to observe or perform any covenant, condition or agreement
contained in Section 5.2(a), Section 5.3 (with respect to a Loan Party’s existence) or Section 5.8
or in Article VI;

          (e) any Loan Party shall fail to observe or perform any covenant, condition or agreement
contained in this Agreement (other than those which constitute a default under another Section of
this Article), and such failure shall continue unremedied for a period of (i) 5 Business Days
after the earlier of such breach or notice thereof from the Administrative Agent (which notice will
be given at the request of any Lender) if such breach relates to terms or provisions of Section
5.1, Section 5.2 (other than Section 5.2(a)), Section 5.6 or Section 5.9 of this Agreement or (ii)
30 days after acquiring actual knowledge or notice thereof from the Administrative Agent (which
notice will be given at the request of any Lender) if such breach relates to terms or provisions of
any other Section of this Agreement or any other Loan Document;

          (f) any Loan Party or any Subsidiary shall fail to make any payment (whether of principal or
interest and regardless of amount) in respect of any Material Indebtedness, when and as the same
shall become due and payable after giving effect to applicable grace periods;

          (g) any event or condition occurs that results in any Material Indebtedness becoming due prior
to its scheduled maturity or that enables or permits (with or without the giving of notice, the
lapse of time or both) the holder or holders of any Material Indebtedness or any trustee or agent
on its or their behalf to cause any Material Indebtedness to become
due, or to

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require the
prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity;
provided that this clause (g) shall not apply to secured Indebtedness that becomes
due as a result of the voluntary sale or transfer of the property or assets securing such
Indebtedness;

          (h) an involuntary proceeding shall be commenced or an involuntary petition shall be
filed seeking (i) liquidation, reorganization or other relief in respect of a Loan Party or any
Subsidiary of any Loan Party or its debts, or of a substantial part of its assets, under any
federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in
effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for any Loan Party or any Subsidiary of any Loan Party or for a substantial part
of its assets, and, in any such case, such proceeding or petition shall continue undismissed for 60
days or an order or decree approving or ordering any of the foregoing shall be entered;

          (i) any Loan Party or any Subsidiary of any Loan Party shall (i) voluntarily commence any
proceeding or file any petition seeking liquidation, reorganization or other relief under any
Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in
effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner,
any proceeding or petition described in clause (h) of this Article, (iii) apply for or consent to
the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official
for such Loan Party or Subsidiary of any Loan Party or for a substantial part of its assets, (iv)
file an answer admitting the material allegations of a petition filed against it in any such
proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for
the purpose of effecting any of the foregoing;

          (j) any Loan Party or any Subsidiary of any Loan Party shall become unable, admit in writing
its inability or fail generally to pay its debts as they become due;

          (k) one or more judgments for the payment of money in an aggregate amount in excess of
$2,500,000 shall be rendered against any Loan Party, any Subsidiary of any Loan Party or any
combination thereof and the same shall remain undischarged for a period of 30 consecutive days
during which execution shall not be effectively stayed, or any action shall be legally taken by a
judgment creditor to attach or levy upon any assets of any Loan Party or any Subsidiary of any Loan
Party to enforce any such judgment or any Loan Party or any Subsidiary of any Loan Party shall fail
within 30 days to discharge one or more non-monetary judgments or orders which, individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect, which judgments or
orders, in any such case, are not stayed on appeal or otherwise being appropriately contested in
good faith by proper proceedings diligently pursued;

          (l) an ERISA Event shall have occurred that, in the opinion of the Required Lenders, when
taken together with all other ERISA Events that have occurred, could reasonably be expected to
result in liability of the Borrowers and their Subsidiaries in an aggregate amount exceeding
$2,500,000 for all periods;

          (m) a Change in Control shall occur;

          (n) the occurrence of any “default” or “event of default”, as defined in any Loan Document
(other than this Agreement) or the breach of any of the terms or provisions of

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any Loan Document
(other than this Agreement), which default or breach continues beyond any period of grace therein
provided;

          (o) the Loan Guaranty shall fail to remain in full force or effect or any action shall be
taken to discontinue or to assert the invalidity or unenforceability of the Loan Guaranty, or any
Loan Guarantor shall fail to comply with any of the terms or provisions of the Loan Guaranty to
which it is a party, or any Loan Guarantor shall deny that it has any further liability under the
Loan Guaranty to which it is a party, or shall give notice to such effect;

          (p) any Collateral Document shall for any reason fail to create a valid and perfected first
priority security interest in any Collateral purported to be covered thereby, except as permitted
by the terms of any Collateral Document, or any Collateral Document shall fail to remain in full
force or effect or any action shall be taken to discontinue or to assert the invalidity or
unenforceability of any Collateral Document, or any Loan Party shall fail to comply with
any of the terms or provisions of any Collateral Document;

          (q) any material provision of any Loan Document for any reason ceases to be valid, binding and
enforceable in accordance with its terms (or any Loan Party shall challenge the enforceability of
any Loan Document or shall assert in writing, or engage in any action or inaction based on any such
assertion, that any provision of any of the Loan Documents has ceased to be or otherwise is not
valid, binding and enforceable in accordance with its terms);

          (r) any Loan Party is criminally indicted or convicted under any law that may reasonably be
expected to lead to a forfeiture of any property of such Loan Party; or

          (s) any Adjustment Amount (as defined in each Purchase Agreement and which, for this purpose,
will reflect any amounts payable to the sellers under the Purchase Agreements or any related
agreements as a result of the payment in full by such sellers of all accounts payable owed to
Detroit Diesel, Deutz and Hyster on or around the Effective Date) is paid by a Borrower (1) when
Availability is less than $30,000,000 or (2) which would result in Availability being less than
$30,000,000 after giving effect to such payment;

then, and in every such event (other than an event with respect to the Borrowers described in
clause (h) or (i) of this Article), and at any time thereafter during the continuance of such
event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to
the Borrowers, take either or both of the following actions, at the same or different times: (i)
terminate the Commitments, and thereupon the Commitments shall terminate immediately, and (ii)
declare the Loans then outstanding to be due and payable in whole (or in part, in which case any
principal not so declared to be due and payable may thereafter be declared to be due and payable),
and thereupon the principal of the Loans so declared to be due and payable, together with accrued
interest thereon and all fees and other obligations of the Borrowers accrued hereunder, shall
become due and payable immediately, without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Borrowers; and in case of any event with respect to the
Borrowers described in clause (h) or (i) of this Article, the Commitments shall automatically
terminate and the principal of the Loans then outstanding, together with accrued interest thereon
and all fees and other obligations of the Borrowers accrued hereunder, shall automatically become
due and payable, without presentment, demand, protest or

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other notice of any kind, all of which are
hereby waived by the Borrowers. Upon the occurrence and the continuance of an Event of Default,
the Agents may, and at the request of the Required Lenders shall, exercise any rights and remedies provided to the Agents under the Loan Documents or
at law or equity, including all remedies provided under the UCC.

ARTICLE VIII

THE AGENTS; INTERCREDITOR ISSUES

     Section 8.1 Appointment of Agents. Each of the Lenders and the Issuing Bank hereby irrevocably
appoints the Administrative Agent as its agent and authorizes the Administrative Agent to take such
actions on its behalf, including execution of the other Loan Documents, and to exercise such powers
as are delegated to the Administrative Agent by the terms of the Loan Documents, together with such
actions and powers as are reasonably incidental thereto. Each of the Lenders
and the Issuing Bank hereby irrevocably appoints the Collateral Agent as its agent and authorizes
the Collateral Agent to take such actions on its behalf, including execution of the other Loan
Documents, and to exercise such powers as are delegated to the Collateral Agent by the terms of the
Loan Documents, together with such actions and powers as are reasonably incidental thereto. Any
bank serving as an Agent hereunder shall have the same rights and powers in its capacity as a
Lender as any other Lender and may exercise the same as though it were not an Agent, and such bank
and its Affiliates may accept deposits from, lend money to and generally engage in any kind of
business with the Loan Parties or any Subsidiary of a Loan Party or other Affiliate thereof as if
it were not an Agent hereunder.

     Section 8.2 Limitation of Duties of Agents. No Agent shall have any duties or obligations except those
expressly set forth in the Loan Documents. Without limiting the generality of the foregoing, (a)
neither Agent shall be subject to any fiduciary or other implied duties, regardless of whether a
Default has occurred and is continuing, (b) no Agent shall have any duty to take any discretionary
action or exercise any discretionary powers, except discretionary rights and powers expressly
contemplated by the Loan Documents that such Agent is required to exercise in writing as directed
by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary
under the circumstances as provided in Section 9.2), and (c) except as expressly set forth in the
Loan Documents, the Agents shall not have any duty to disclose, and shall not be liable for the
failure to disclose, any information relating to any Loan Party or any of its Subsidiaries that is
communicated to or obtained by the bank serving as an Agent or any of its Affiliates in any
capacity. No Agent shall be liable for any action taken or not taken by it with the consent or at
the request of the Required Lenders (or such other number or percentage of the Lenders as shall be
necessary under the circumstances as provided in Section 9.2) or in the absence of its own gross
negligence or willful misconduct. No Agent shall be deemed to have knowledge of any Default unless
and until written notice thereof is given to such Agent by the Borrowers or a Lender, and the
Agents shall not be responsible for or have any duty to ascertain or inquire into (i) any
statement, warranty or representation made in or in connection with any Loan Document, (ii) the
contents of any certificate, report or other document delivered hereunder or in connection with any
Loan Document, (iii) the performance or observance of any of the covenants, agreements or other
terms or conditions set forth in any Loan Document, (iv) the validity, enforceability,
effectiveness or genuineness of any Loan Document or any other agreement, instrument or document,
(v) the creation, perfection or

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priority of Liens on the Collateral or the existence of the
Collateral, or (vi) the satisfaction of any
 condition set forth in Article IV or elsewhere in any
Loan Document, other than to confirm receipt of items expressly required to be delivered to the
Agents.

     Section 8.3 Reliance by Agents. Each Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent, statement, instrument,
document or other writing believed by it to be genuine and to have been signed or sent by the
proper Person. Each Agent also may rely upon any statement made to it orally or by telephone and
believed by it to be made by the proper Person, and shall not incur any liability for relying
thereon. Each Agent may consult with legal counsel (who may be counsel for the Borrowers),
independent accountants and other experts selected by it, and shall not be liable for any action
taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

     Section 8.4 Sub-Agents. Each Agent may perform any and all its duties and exercise its rights and
powers by or through any one or more sub-agents appointed by such Agent. Each Agent and any of
such Agent’s sub-agent may perform any and all its duties and exercise its rights and powers
through their respective Related Parties. The exculpatory provisions of the preceding paragraphs
shall apply to any such sub-agent and to the Related Parties of the Agents and any such sub-agents,
and shall apply to their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Agents.

     Section 8.5 Resignation of Agents; Successor Agents. Subject to the appointment and acceptance of a
successor Agent as provided in this paragraph, each Agent may resign at any time by notifying the
Lenders, the Issuing Bank and the Borrowers. Upon any such resignation, the Required Lenders shall
have the right, in consultation with the Borrowers, to appoint a successor. If no successor shall
have been so appointed by the Required Lenders and shall have accepted such appointment within 30
days after the retiring Agent gives notice of its resignation, then the retiring Agent may, on
behalf of the Lenders and the Issuing Bank, appoint a successor Agent which shall be a commercial
bank or an Affiliate of any such commercial bank. Upon the acceptance of its appointment as an
Agent hereunder by a successor, such successor shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations hereunder. The fees payable by the Borrowers to a
successor Agent shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrowers and such successor. After an Agent’s resignation hereunder, the provisions
of this Article VIII and Section 9.3 shall continue in effect for the benefit of such retiring
Agent, its sub agents and their respective Related Parties in respect of any actions taken or
omitted to be taken by any of them while it was acting as Agent.

     Section 8.6 Lender Acknowledgments.

          (a) Each Lender acknowledges that it has, independently and without reliance upon the either
Agent or any other Lender and based on such documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon either Agent or any other Lender
and based on such documents and information as it shall from time to

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time deem appropriate,
continue to make its own decisions in taking or not taking action under or

based upon this Agreement, any other Loan Document or related agreement or any document furnished hereunder or
thereunder.

          (b) Each Lender hereby agrees that (a) it has requested a copy of each Report prepared by or
on behalf of either Agent; (b) neither Agent (i) make any representation or warranty, express or
implied, as to the completeness or accuracy of any Report or any of the information contained
therein or any inaccuracy or omission contained in or relating to a Report and (ii) shall not be
liable for any information contained in any Report; (c) the Reports are not comprehensive audits or
examinations, and that any Person performing any field examination will inspect only specific
information regarding the Loan Parties and will rely significantly upon the Loan Parties’ books and
records, as well as on representations of the Loan Parties’ personnel and that neither Agent
undertakes any obligation to update, correct or supplement the Reports; (d) it will keep all
Reports confidential and strictly for its internal use, not share the Report with
any Loan Party or any other Person except as otherwise permitted pursuant to this Agreement;
and (e) without limiting the generality of any other indemnification provision contained in this
Agreement, it will pay and protect, and indemnify, defend, and hold each Agent and any such other
Person preparing a Report harmless from and against, the claims, actions, proceedings, damages,
costs, expenses, and other amounts (including reasonable attorney fees) incurred by as the direct
or indirect result of any third parties who might obtain all or part of any Report through the
indemnifying Lender.

ARTICLE IX

MISCELLANEOUS

     Section 9.1 Notices.

          (a) Except in the case of notices and other communications expressly permitted to be given by
telephone (and subject to Section 9.1(b) below), all notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by
certified or registered mail or sent by facsimile, as follows:

          (i)     if to any Loan Party, to the Company at:

Stewart & Stevenson LLC

1000 Louisiana, Suite 5900

Houston, Texas 77002

Attention: John Simmons

Facsimile No: (713) 659-3137

          (ii)     if to the Agents, the Issuing Bank or the Swingline Lender, to JPMorgan Chase
Bank, N.A. at:

JPMorgan Chase Bank, N.A.

2200 Ross Avenue, 6th Floor

Dallas, Texas 75025

Mail Code # TX1-291

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Attention: Lawrence J. Cannariato

Facsimile No: (214) 965-2954

and

          (iii) if to any other Lender, to it at its address or facsimile number set forth in its
Administrative Questionnaire.

All such notices and other communications (A) sent by hand or overnight courier service, or mailed
by certified or registered mail, shall be deemed to have been given when received or (B) sent by
facsimile shall be deemed to have been given when sent, provided that if not given
during normal business hours for the recipient, shall be deemed to have been given at the opening
of business on the next Business Day for the recipient.

          (b) Notices and other communications to the Lenders hereunder may be delivered or furnished by
electronic communications (including e-mail and internet or intranet websites) pursuant to
procedures approved by the Administrative Agent; provided that the foregoing shall
not apply to notices pursuant to Article II or to compliance and no Event of Default certificates
delivered pursuant to Section 5.1(d) unless otherwise agreed by the Administrative Agent and the
applicable Lender. The Administrative Agent, the Collateral Agent or the Company (on behalf of the
Loan Parties) may, in its discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it; provided
that approval of such procedures may be limited to particular notices or communications.
All such notices and other communications (i) sent to an e-mail address shall be deemed received
upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return
receipt requested” function, as available, return e-mail or other written acknowledgement),
provided that if not given during the normal business hours of the recipient, such
notice or communication shall be deemed to have been given at the opening of business on the next
Business Day for the recipient, and (ii) posted to an Internet or intranet website shall be deemed
received upon the deemed receipt by the intended recipient at its e-mail address as described in
the foregoing Section 9.1(b)(i) of notification that such notice or communication is available and
identifying the website address therefor.

          (c) Any party hereto may change its address or facsimile number for notices and other
communications hereunder by notice to the other parties hereto.

     Section 9.2 Waivers; Amendments.

          (a) No failure or delay by any Agent, the Issuing Bank or any Lender in exercising any right
or power hereunder or under any other Loan Document shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise thereof or the
exercise of any other right or power. The rights and remedies of the Agents, the Issuing Bank and
the Lenders hereunder and under any other Loan Document are cumulative and are not exclusive of any
rights or remedies that they would otherwise have. No waiver of any provision of any Loan Document
or consent to any departure by any Loan Party therefrom shall in any event be effective unless the
same shall be permitted by Section 9.2(b),

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and then such waiver or consent shall be effective only
in the specific instance and for the purpose for which given. Without limiting the generality of
the foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as a
waiver of any Default, regardless of
 whether any Agent, any Lender or the Issuing Bank may have had
notice or knowledge of such Default at the time.

          (b) Neither this Agreement nor any other Loan Document nor any provision hereof or thereof may
be waived, amended or modified except (i) in the case of this Agreement, pursuant to an agreement
or agreements in writing entered into by the Borrowers and the Required Lenders or, (ii) in the
case of any other Loan Document, pursuant to an agreement or agreements in writing entered into by
the Agent party thereto and the Loan Party or Loan Parties that are parties thereto, with the
consent of the Required Lenders; provided that no such agreement shall (A) increase
the Commitment of any Lender without the written consent of such Lender (provided
that the Administrative Agent may make Protective Advances as
set forth in Section 2.4), (B) reduce or forgive the principal amount of any Loan or LC Disbursement or
reduce the rate of interest thereon, or reduce or forgive any interest or fees payable hereunder,
without the written consent of each Lender directly affected thereby, (C) postpone any scheduled
date of payment of the principal amount of any Loan or LC Disbursement, or any date for the payment
of any interest, fees or other Obligations payable hereunder, or reduce the amount of, waive or
excuse any such payment, or postpone the scheduled date of expiration of any Commitment, without
the written consent of each Lender directly affected thereby, (D) change Section 2.18(b) or Section
2.18(d) in a manner that would alter the manner in which payments are shared, without the written
consent of each Lender, (E) increase the advance rates set forth in the definition of Borrowing
Base, add new categories of eligible assets or modify the definitions applicable to existing
categories of eligible assets in a manner that would have the effect of increasing Availability,
without the written consent of the Supermajority Revolving Lenders, (F) change any of the
provisions of this Section or the definition of “Required Lenders” or any other provision of any
Loan Document specifying the number or percentage of Lenders (or Lenders of any Class) required to
waive, amend or modify any rights thereunder or make any determination or grant any consent
thereunder, without the written consent of each Lender, (G) release any Loan Guarantor from its
obligation under its Loan Guaranty (except as otherwise permitted herein or in the other Loan
Documents), without the written consent of each Lender, (H) consent to the assignment of this
Agreement or any other Loan Document by any Loan Party, without the consent of each Lender, or (I)
except as provided in Section 9.2(d) of this Section or in any Collateral Document, release all or
substantially all of the Collateral, without the written consent of each Lender; provided
further that no such agreement shall amend, modify or otherwise affect the rights
or duties of any Agent, the Issuing Bank or the Swingline Lender hereunder without the prior
written consent of such Agent, the Issuing Bank or the Swingline Lender as the case may be. The
Administrative Agent may also amend the Commitment Schedule to reflect assignments entered into
pursuant to Section 9.4.

          (c) The Lenders hereby irrevocably authorize the Collateral Agent, at its option and in its
sole discretion, to release any Liens granted to the Collateral Agent by the Loan Parties on any
Collateral (i) upon the termination of the all Commitments, payment and satisfaction in full in
cash of all Secured Obligations (other than Unliquidated Obligations), and the cash
collateralization of all Unliquidated Obligations in a manner satisfactory to each affected Lender,
(ii) constituting property being sold or disposed of if the Loan Party disposing

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of such property
certifies to the Collateral Agent that the sale or disposition is made in compliance with the terms
of this Agreement (and the Collateral Agent may rely conclusively on any such certificate, without
further inquiry), (iii) constituting property leased to a Loan
Party under a lease which has
expired or been terminated in a transaction permitted under this Agreement, or (iv) as required to
effect any sale or other disposition of such Collateral in connection with any exercise of remedies
of the Agents or the Lenders pursuant to Article VII.
Except as provided in the preceding sentence, the Collateral Agent will not release any Liens
on Collateral without the prior written authorization of the Required Lenders; provided
that, the Collateral Agent may in its discretion, release its Liens on Collateral valued in
the aggregate not in excess of $10,000,000 during any calendar year without the prior written
authorization of the Required Lenders. Any such release shall not in any manner discharge, affect,
or impair the Obligations or any Liens (other than those expressly being released) upon (or
obligations of the Loan Parties in respect of) all interests retained by the Loan Parties,
including the proceeds of any sale, all of which shall continue to constitute part of the
Collateral.

          (d) If, in connection with any proposed amendment, waiver or consent requiring the consent of
“each Lender” or “each Lender affected thereby,” the consent of the Required Lenders is obtained,
but the consent of other necessary Lenders is not obtained (any such Lender whose consent is
necessary but not obtained being referred to herein as a “Non-Consenting Lender”), then the
Borrowers may elect to replace a Non-Consenting Lender as a Lender party to this Agreement,
provided that, concurrently with such replacement, (i) another bank or other entity
which is reasonably satisfactory to the Borrowers and the Administrative Agent shall agree, as of
such date, to purchase for cash the Loans and other Obligations due to the Non-Consenting Lender
pursuant to an Assignment and Assumption and to become a Lender for all purposes under this
Agreement and to assume all obligations of the Non-Consenting Lender to be terminated as of such
date and to comply with the requirements of Section 9.4(b), and (ii) the Borrowers shall pay to
such Non-Consenting Lender in same day funds on the day of such replacement (A) all interest, fees
and other amounts then accrued but unpaid to such Non-Consenting Lender by the Borrowers hereunder
to and including the date of termination, including without limitation payments due to such
Non-Consenting Lender under Section 2.15 and Section 2.17, and (B) an amount, if any, equal to the
payment which would have been due to such Lender on the day of such replacement under Section 2.16
had the Loans of such Non-Consenting Lender been prepaid on such date rather than sold to the
replacement Lender.

     Section 9.3 Expenses; Indemnity; Damage Waiver.

          (a) The Borrowers shall pay (i) all reasonable out of pocket expenses incurred by each Agent
and its Affiliates, including the reasonable fees, charges and disbursements of Vinson & Elkins
L.L.P., and local counsel in applicable jurisdictions, in connection with the syndication and
distribution (including, without limitation, via the internet or through a service such as
Intralinks) of the credit facilities provided for herein, the preparation and administration of the
Loan Documents or any amendments, modifications or waivers of the provisions of the Loan Documents
(whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all
reasonable out-of-pocket expenses incurred by the Issuing Bank in connection with the issuance,
amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and
(iii) all out-of-pocket expenses incurred by any Agent, the Issuing Bank or any Lender, including
the fees, charges and disbursements of any counsel for

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any Agent, the Issuing Bank or any Lender,
in connection with the enforcement, collection or protection of its rights in connection with the
Loan Documents, including its rights under this Section, or in connection with the Loans made or
Letters of Credit issued hereunder, including
all such out-of pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans or Letters of Credit. Expenses
being reimbursed by the Borrowers under
this Section include, without limiting the generality of the foregoing, costs and expenses
incurred in connection with:

          (i) appraisals and environmental reports;

          (ii) field examinations and the preparation of Reports based on the fees charged by a
third party retained by the Administrative Agent or the internally allocated fees for each
Person employed by the Administrative Agent with respect to each field examination;

          (iii) lien and title searches and title insurance;

          (iv) taxes, fees and other charges for recording the Mortgages, filing financing
statements and continuations, and other actions to perfect, protect, and continue the
Collateral Agent’s Liens;

          (v) sums paid or incurred to take any action required of any Loan Party under the Loan
Documents that such Loan Party fails to pay or take; and

          (vi) forwarding loan proceeds, collecting checks and other items of payment, and
establishing and maintaining the accounts and lock boxes, and costs and expenses of
preserving and protecting the Collateral.

All of the foregoing costs and expenses may be charged to the Borrowers as Revolving Loans or to
another deposit account, all as described in Section 2.18(c).

          (b) The Borrowers shall, jointly and severally, indemnify each Agent, the Issuing Bank and
each Lender, and each Related Party of any of the foregoing Persons (each such Person being called
an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses,
claims, damages, penalties, liabilities and related expenses, including the fees, charges and
disbursements of any counsel for any Indemnitee, incurred by or asserted against any Indemnitee
arising out of, in connection with, or as a result of (i) the execution or delivery of the Loan
Documents or any agreement or instrument contemplated thereby, the performance by the parties
hereto of their respective obligations thereunder or the consummation of the Transactions or any
other transactions contemplated hereby, (ii) any Loan or Letter of Credit or the use of the
proceeds therefrom (including any refusal by the Issuing Bank to honor a demand for payment under a
Letter of Credit if the documents presented in connection with such demand do not strictly comply
with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of
Hazardous Materials on or from any property owned or operated by the Borrowers or any of their
Subsidiaries, or any Environmental Liability related in any way to the Borrowers or any of their
Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or 

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any other theory and
regardless of whether any Indemnitee is a party thereto; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims,
damages, penalties, liabilities or related expenses are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or
willful misconduct of such Indemnitee.

          (c) To the extent that the Borrowers fail to pay any amount required to be paid by any of them
to any Agent, the Issuing Bank or the Swingline Lender under Section 9.3(a) or Section 9.3(b), each
Lender severally agrees to pay such Agent, the Issuing Bank or the Swingline Lender, as the case
may be, such Lender’s Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided
that the unreimbursed expense or indemnified loss, claim, damage, penalty, liability or
related expense, as the case may be, was incurred by or asserted against such Agent, the Issuing
Bank or the Swingline Lender in its capacity as such.

          (d) To the extent permitted by applicable law, no Loan Party shall assert, and each hereby
waives, any claim against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages) arising out of, in
connection with, or as a result of, this Agreement or any agreement or instrument contemplated
hereby, the Transactions, any Loan or Letter of Credit or the use of the proceeds thereof.

          (e) All amounts due under this Section shall be payable promptly after written demand
therefor.

     Section 9.4 Successors and Assigns.

          (a) The provisions of this Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns permitted hereby (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), except that (i) the Borrowers 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 Borrowers without
such consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its rights
or obligations hereunder except in accordance with this Section. Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than the parties hereto,
their respective successors and assigns permitted hereby (including any Affiliate of the Issuing
Bank that issues any Letter of Credit), Participants (to the extent provided in Section 9.4(c))
and, to the extent expressly contemplated hereby, the Related Parties of each of the Agents, the
Issuing Bank and the Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.

          (b) (i) Subject to the conditions set forth in Section 9.4(b)(ii) below, any Lender may assign
to one or more assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans at the time owing to it) with the prior
written consent (such consent not to be unreasonably withheld) of:

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          (A) the Borrowers, provided that no consent of the Borrowers
shall be required for an assignment to a Lender, an Affiliate of a Lender, an
Approved Fund or, if an Event of Default has occurred and is continuing, any other
assignee;

          (B) the Administrative Agent; and

          (C) with respect to the assignment of any Revolving Commitment, the Issuing
Bank.

          (ii) Assignments shall be subject to the following additional conditions:

          (A) except in the case of an assignment to a Lender or an Affiliate of a Lender
or an assignment of the entire remaining amount of the assigning Lender’s Commitment
or Loans of any Class, the amount of the Commitment or Loans of the assigning Lender
subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent) shall not be less than
$5,000,000 unless each of the Borrowers and the Administrative Agent otherwise
consent, provided that no such consent of the Borrowers shall be
required if an Event of Default has occurred and is continuing;

          (B) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement;

          (C) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing and
recordation fee of $3,500; and

          (D) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire.

     For the purposes of this Section 9.4(b), the term “Approved Fund” has the following
meaning:

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

          (iii) Subject to acceptance and recording thereof pursuant to Section 9.4(b)(iv), from
and after the effective date specified in each Assignment and Assumption the assignee
thereunder shall be a party hereto and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent

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 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 Section 2.15, Section 2.16, Section 2.17 and
Section 9.3). Any assignment or transfer by a Lender of rights or obligations under this
Agreement that does not comply with this Section 9.4 shall be treated for purposes of this Agreement as a sale by such Lender of
a participation in such rights and obligations in accordance with this Section 9.4(c).

          (iv) The Administrative Agent, acting for this purpose as an agent of the Borrowers,
shall maintain at one of its offices a copy of each Assignment and Assumption delivered to
it and a register for the recordation of the names and addresses of the Lenders, and the
Commitment of, and principal amount of the Loans and LC Disbursements owing to, each Lender
pursuant to the terms hereof from time to time (the “Register”). The entries in the
Register shall be conclusive, and the Borrowers, the Administrative Agent, the Issuing Bank
and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall
be available for inspection by the Borrowers, the Issuing Bank and any Lender, at any
reasonable time and from time to time upon reasonable prior notice.

          (v) Upon its receipt of a duly completed Assignment and Assumption executed by an
assigning Lender and an assignee, the assignee’s completed Administrative Questionnaire
(unless the assignee shall already be a Lender hereunder), the processing and recordation
fee referred to in Section 9.4(b) and any written consent to such assignment required by
Section 9.4(b), the Administrative Agent shall accept such Assignment and Assumption and
record the information contained therein in the Register; provided that if
either the assigning Lender or the assignee shall have failed to make any payment required
to be made by it pursuant to Section 2.5, Section 2.6(d) or Section 2.6(e), Section 2.7(b),
Section 2.18(d) or Section 9.3(c), the Administrative Agent shall have no obligation to
accept such Assignment and Assumption and record the information therein in the Register
unless and until such payment shall have been made in full, together with all accrued
interest thereon. No assignment shall be effective for purposes of this Agreement unless it
has been recorded in the Register as provided in this paragraph.

          (c)
(i) Any Lender may, without the consent of the Borrowers, the Administrative Agent, the
Issuing Bank or the Swingline Lender, sell participations to one or more banks or other entities (a
“Participant”) in all or a portion of such Lender’s rights and obligations under this
Agreement (including all or a portion of its Commitment and the Loans owing to it);
provided that (A) such Lender’s obligations under this Agreement shall remain
unchanged, (B) such Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (C) the Borrowers, the Agents, the Issuing Bank and the other
Lenders shall continue to deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to
which a Lender sells such a participation shall provide that such Lender shall retain the sole
right to enforce this Agreement and to approve any amendment, modification or waiver of any

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provision of this Agreement; provided that such agreement or instrument may provide
that such Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver described in the first proviso to Section 9.2(b) that affects such
Participant. Subject to Section 9.4(c)(ii) of this Section, the Borrowers agree that each
Participant shall be entitled to the benefits of Section 2.15, Section 2.16 and Section 2.17 to the
same extent as if it were a Lender

and had acquired its interest by assignment pursuant to Section 9.4(b). To the extent
permitted by law, each Participant also shall be entitled to the benefits of Section 9.8 as though
it were a Lender, provided such Participant agrees to be subject to Section 2.18(c) as though it
were a Lender.

          (ii) A Participant shall not be entitled to receive any greater payment under Section
2.15 or Section 2.17 than the applicable Lender would have been entitled to receive with
respect to the participation sold to such Participant, unless the sale of the participation
to such Participant is made with the Borrowers’ prior written consent. A Participant that
would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of
Section 2.17 unless the Borrowers are notified of the participation sold to such
Participant and such Participant agrees, for the benefit of the Borrowers, to comply
with Section 2.17(e) as though it were a Lender.

          (d) Any Lender may at any time pledge or assign a security interest in all or any portion of
its rights under this Agreement to secure obligations of such Lender, including without limitation
any pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section shall
not apply to any such pledge or assignment of a security interest; provided that no
such pledge or assignment of a security interest shall release a Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

     Section 9.5 Survival. All covenants, agreements, representations and warranties made by
the Loan Parties in the Loan Documents and in the certificates or other instruments delivered in
connection with or pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the other parties hereto and shall survive the execution and delivery of
the Loan Documents and the making of any Loans and issuance of any Letters of Credit, regardless of
any investigation made by any such other party or on its behalf and notwithstanding that any Agent,
the Issuing Bank or any Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended hereunder, and shall continue in full
force and effect as long as the principal of or any accrued interest on any Loan or any fee or any
other amount payable under this Agreement is outstanding and unpaid or any Letter of Credit is
outstanding and so long as the Commitments have not expired or terminated. The provisions of
Section 2.15, Section 2.16, Section 2.17 and Section 9.3 and Article VIII shall survive and remain
in full force and effect regardless of the consummation of the transactions contemplated hereby,
the repayment of the Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof.

     Section 9.6
 Counterparts; Integration; Effectiveness. This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a single

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 contract.
This Agreement, the other Loan Documents and any separate letter agreements with respect to fees
payable to the Administrative Agent constitute the entire contract among the parties relating to
the subject matter hereof and supersede any and all previous agreements and understandings, oral or
written, relating to the subject matter hereof. Except as provided in Section 4.1, this Agreement
shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns. Delivery of an
executed counterpart of a signature page of this Agreement by facsimile shall be effective as
delivery of a manually executed counterpart of this Agreement. THIS WRITTEN AGREEMENT REPRESENTS
THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.

     Section 9.7 Severability. Any provision of any Loan Document held to be invalid, illegal
or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such invalidity, illegality or unenforceability without affecting the validity, legality and
enforceability of the remaining provisions thereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

     Section 9.8 Right of Setoff. If an Event of Default shall have occurred and be continuing,
each Lender and each of its Affiliates is hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other obligations at any time owing by
such Lender or Affiliate to or for the credit or the account of the Borrowers against any of and
all the Secured Obligations held by such Lender, irrespective of whether or not such Lender shall
have made any demand under the Loan Documents and although such obligations may be unmatured. The
applicable Lender shall notify the Borrowers and the Administrative Agent of such set-off or
application, provided that any failure to give or any delay in giving such notice
shall not affect the validity of any such set-off or application under this Section. The rights of
each Lender under this Section are in addition to other rights and remedies (including other rights
of setoff) which such Lender may have.

     Section 9.9 Governing Law; Jurisdiction; Consent to Service of Process.

          (a) The Loan Documents (other than those containing a contrary express choice of law
provision) shall be governed by and construed in accordance with the laws of the State of New York,
but giving effect to federal laws applicable to national banks.

          (b) Each Loan Party hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any U.S. Federal or New York State court sitting in
New York, New York in any action or proceeding arising out of or relating to any Loan Documents, or
for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or proceeding may be heard
and determined in such New York State or, to the extent permitted by

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law, in such Federal court.
Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. Nothing in this Agreement or any other Loan Document shall affect any
right that any Agent, the Issuing Bank or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against any Loan Party or its
properties in the courts of any jurisdiction.

          (c) Each Loan Party hereby irrevocably and unconditionally waives, to the fullest extent it
may legally and effectively do so, any objection which it may now or hereafter have to the laying
of venue of any suit, action or proceeding arising out of or relating to this Agreement or any
other Loan Document in any court referred to in Section 9.9(b). Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to
the maintenance of such action or proceeding in any such court.

          (d) Each party to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 9.1. Nothing in this Agreement or any other Loan
Document will affect the right of any party to this Agreement to serve process in any other
manner permitted by law.

     Section 9.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING
DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (a) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION,
SEEK TO ENFORCE THE FOREGOING WAIVER AND (b) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.

     Section 9.11 Headings. Article and Section headings and the Table of Contents used herein
are for convenience of reference only, are not part of this Agreement and shall not affect the
construction of, or be taken into consideration in interpreting, this Agreement.

     Section 9.12 Confidentiality. Each of the Agents, the Issuing Bank 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 Requirement of Law 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 any other Loan Document or the
enforcement of rights hereunder or thereunder, (f) subject to an

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 agreement containing provisions
substantially the same as those of this Section, to (i) any assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights or obligations under this Agreement or
(ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction
relating to the Loan Parties and their obligations, (g) with the consent of the Borrowers or (h) to the extent such Information (i) becomes publicly available other than as a result of a breach of
this Section or (ii) becomes available to any Agent, the Issuing Bank or any Lender on a
nonconfidential basis from a source other than the Borrowers. For the purposes of this Section,
“Information” means all information received from the Borrowers relating to the Borrowers
or their businesses, other than any such information that is available to any Agent, the Issuing
Bank or any Lender on a non-confidential basis prior to disclosure by the Borrowers;
provided that, in the case of information received from the Borrowers after the
date hereof, such information is clearly identified at the time of delivery as confidential. Any
Person required to maintain the confidentiality of Information as provided in this Section shall be
considered to have complied with its obligation to do so if such Person has exercised the same
degree of care to maintain the confidentiality of such Information as such Person would accord to
its own confidential information.

     Section 9.13 Several Obligations; Nonreliance; Violation of Law. The respective
obligations of the Lenders hereunder are several and not joint and the failure of any Lender to
make any Loan or perform any of its obligations hereunder shall not relieve any other Lender from
any of its obligations hereunder. Each Lender hereby represents that it is not relying on or
looking to any margin stock for the repayment of the Borrowings provided for herein. Anything
contained in this Agreement to the contrary notwithstanding, neither the Issuing Bank nor any
Lender shall be obligated to extend credit to the Borrowers in violation of any Requirement of Law.

     Section 9.14 USA Patriot Act. Each Lender that is subject to the requirements of the USA
Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”)
hereby notifies the Borrowers that pursuant to the requirements of the Act, it is required to
obtain, verify and record information that identifies the Borrowers, which information includes the
name and address of the Borrowers and other information that will allow such Lender to identify the
Borrowers in accordance with the Act.

     Section 9.15 Disclosure. Each Loan Party and each Lender hereby acknowledges and agrees
that each Agent and/or its Affiliates from time to time may hold investments in, make other loans
to or have other relationships with any of the Loan Parties and their respective Affiliates.

     Section 9.16 Appointment for Perfection. Each Lender hereby appoints each other Lender as
its agent for the purpose of perfecting Liens, for the benefit of the Administrative Agent, the
Collateral Agent and the Lenders, in assets which, in accordance with Article 9 of the UCC or any
other applicable law can be perfected only by possession. Should any Lender (other than the
Collateral Agent) obtain possession of any such Collateral, such Lender shall notify the Collateral
Agent thereof, and, promptly upon the Collateral Agent’s request therefor shall deliver such
Collateral to the Collateral Agent or otherwise deal with such Collateral in accordance with the
Collateral Agent’s instructions.

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     Section 9.17 Interest Rate Limitation. Notwithstanding anything herein to the contrary,
if at any time the interest rate applicable to any Loan, together with all fees, charges and other
amounts which are treated as interest on such Loan under applicable law (collectively the
“Charges”), shall exceed the maximum lawful
rate (the “Maximum Rate”) which may be contracted for, charged, taken, received or reserved by the Lender holding such Loan in accordance
with applicable law, the rate of interest payable in respect of such Loan hereunder, together with
all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent
lawful, the interest and Charges that would have been payable in respect of such Loan but were not
payable as a result of the operation of this Section shall be cumulated and the interest and
Charges payable to such Lender in respect of other Loans or periods shall be increased (but not
above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the
Federal Funds Effective Rate to the date of repayment, shall have been received by such Lender.

ARTICLE X

LOAN GUARANTY

     Section 10.1 Guaranty. Each Loan Guarantor now or hereafter a party hereto hereby agrees
that it is jointly and severally liable for, and, as primary obligor and not merely as surety,
absolutely and unconditionally guarantees to the Lenders and the Other Secured Parties the prompt payment when
due, whether at stated maturity, upon acceleration or otherwise, and at all times thereafter, of
the Secured Obligations and all costs and expenses including, without limitation, all court costs
and attorneys’ and paralegals’ fees (including allocated costs of in-house counsel and paralegals)
and expenses paid or incurred by the Agents, the Issuing Bank and the Lenders in endeavoring to
collect all or any part of the Secured Obligations from, or in prosecuting any action against, the
Borrowers, any Loan Guarantor or any other guarantor of all or any part of the Secured Obligations
(such costs and expenses, together with the Secured Obligations, collectively the “Guaranteed
Obligations”). Each Loan Guarantor further agrees that the Guaranteed Obligations may be
extended or renewed in whole or in part without notice to or further assent from it, and that it
remains bound upon its guarantee notwithstanding any such extension or renewal. All terms of this
Loan Guaranty apply to and may be enforced by or on behalf of any domestic or foreign branch or
Affiliate of any Lender that extended any portion of the Guaranteed Obligations.

     Section 10.2 Guaranty of Payment. This Loan Guaranty is a guaranty of payment and not of
collection. Each Loan Guarantor waives any right to require the Agents, the Issuing Bank, any
Lender and/or any Other Secured Parties to sue the Borrowers, any Loan Guarantor, any other
guarantor, or any other person obligated for all or any part of the Guaranteed Obligations (each,
an “Obligated Party”), or otherwise to enforce its payment against any collateral securing
all or any part of the Guaranteed Obligations.

     Section 10.3 No Discharge or Diminishment of Loan Guaranty.

          (a) Except as otherwise provided for herein, the obligations of each Loan Guarantor hereunder
are unconditional and absolute and not subject to any reduction, limitation, impairment or
termination for any reason (other than the indefeasible payment in full in cash of the Guaranteed
Obligations), including: (i) any claim of waiver, release, extension, renewal, settlement,

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surrender, alteration, or compromise of any of the Guaranteed Obligations, by operation of law or
otherwise; (ii) any change in the corporate existence, structure or ownership of any Borrower or
any other guarantor of or other person liable for any of the Guaranteed Obligations; (iii) any
insolvency, bankruptcy, reorganization or other similar proceeding affecting any Obligated Party, or their assets or any resulting release or discharge of any obligation of any Obligated Party; or
(iv) the existence of any claim, setoff or other rights which any Loan Guarantor may have at any
time against any Obligated Party, any Agent, the Issuing Bank, any Lender and/or Other Secured
Parties or any other person, whether in connection herewith or in any unrelated transactions.

          (b) The obligations of each Loan Guarantor hereunder are not subject to any defense or setoff,
counterclaim, recoupment, or termination whatsoever by reason of the invalidity, illegality, or
unenforceability of any of the Guaranteed Obligations or otherwise, or any provision of applicable
law or regulation purporting to prohibit payment by any Obligated Party, of the Guaranteed
Obligations or any part thereof.

          (c) Further, the obligations of any Loan Guarantor hereunder are not discharged or impaired or
otherwise affected by: (i) the failure of any Agent, the Issuing Bank, any Lender and any Other
Secured Parties to assert any claim or demand or to enforce any
remedy with respect to all or any part of the Guaranteed Obligations; (ii) any waiver or
modification of or supplement to any provision of any agreement relating to the Guaranteed
Obligations; (iii) any release, non-perfection, or invalidity of any indirect or direct security
for the obligations of any Borrower for all or any part of the Guaranteed Obligations or any
obligations of any other guarantor of or other person liable for any of the Guaranteed Obligations;
(iv) any action or failure to act by any Agent, the Issuing Bank, any Lender and any Other Secured
Parties with respect to any collateral securing any part of the Guaranteed Obligations; or (v) any
default, failure or delay, willful or otherwise, in the payment or performance of any of the
Guaranteed Obligations, or any other circumstance, act, omission or delay that might in any manner
or to any extent vary the risk of such Loan Guarantor or that would otherwise operate as a
discharge of any Loan Guarantor as a matter of law or equity (other than the indefeasible payment
in full in cash of the Guaranteed Obligations).

     Section 10.4 Defenses Waived. To the fullest extent permitted by applicable law, each Loan
Guarantor hereby waives any defense based on or arising out of any defense of the Borrower or any
Loan Guarantor or the unenforceability of all or any part of the Guaranteed Obligations from any
cause, or the cessation from any cause of the liability of any Borrower or any Loan Guarantor,
other than the indefeasible payment in full in cash of the Guaranteed Obligations. Without
limiting the generality of the foregoing, each Loan Guarantor irrevocably waives acceptance hereof,
presentment, demand, protest and, to the fullest extent permitted by law, any notice not provided
for herein, as well as any requirement that at any time any action be taken by any person against
any Obligated Party, or any other person. The Collateral Agent may, at its election, foreclose on
any Collateral held by it by one or more judicial or nonjudicial sales, accept an assignment of any
such Collateral in lieu of foreclosure or otherwise act or fail to act with respect to any
collateral securing all or a part of the Guaranteed Obligations, compromise or adjust any part of
the Guaranteed Obligations, make any other accommodation with any Obligated Party or exercise any
other right or remedy available to it against any Obligated Party, without affecting or impairing
in any way the liability of such Loan Guarantor

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under this Loan Guaranty except to the extent the
Guaranteed Obligations have been fully and indefeasibly paid in cash. To the fullest extent
permitted by applicable law, each Loan Guarantor waives any defense arising out of any such
election even though that election may operate, pursuant to applicable law, to impair or extinguish
any right of reimbursement or subrogation or other right or remedy of any Loan Guarantor against
any Obligated Party or any security.

     Section 10.5 Rights of Subrogation. No Loan Guarantor will assert any right, claim or
cause of action, including, without limitation, a claim of subrogation, contribution or
indemnification that it has against any Obligated Party, or any collateral, until the Loan Parties
and the Loan Guarantors have fully performed all their obligations to the Agents, the Issuing Bank,
the Lenders and any Other Secured Parties.

     Section 10.6 Reinstatement; Stay of Acceleration. If at any time any payment of any
portion of the Guaranteed Obligations is rescinded or must otherwise be restored or returned upon
the insolvency, bankruptcy, or reorganization of any Borrower or otherwise, each Loan Guarantor’s
obligations under this Loan Guaranty with respect to that payment shall be reinstated at such time
as though the payment had not been made and whether or not the Agents, the Issuing Bank, the
Lenders and any Other Secured Parties are in possession of this Loan Guaranty. If acceleration of
the time for payment of any of the Guaranteed Obligations is stayed upon the
insolvency, bankruptcy or reorganization of any Borrower, all such amounts otherwise subject to
acceleration under the terms of any agreement relating to the Guaranteed Obligations shall
nonetheless be payable by the Loan Guarantors forthwith on demand by the Lender, any Other Secured
Parties and the Issuing Bank.

     Section 10.7 Information. Each Loan Guarantor assumes all responsibility for being and
keeping itself informed of the Borrowers’ financial condition and assets, and of all other
circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations and the nature,
scope and extent of the risks that each Loan Guarantor assumes and incurs under this Loan Guaranty,
and agrees that neither any Agent, the Issuing Bank nor any Lender shall have any duty to advise
any Loan Guarantor of information known to it regarding those circumstances or risks.

     Section 10.8 Termination. Each Loan Guarantor acknowledges and agrees that this Loan
Guaranty is irrevocable until the Guaranteed Obligations have been paid in full and the Commitments
have been terminated. The Lenders may continue to make loans or extend credit to the Borrowers
based on this Loan Guaranty. Each Loan Guarantor will continue to be liable to the Lenders for any
Guaranteed Obligations created, assumed or committed from time to time, and all subsequent
renewals, extensions, modifications and amendments with respect to, or substitutions for, all or
any part of that Guaranteed Obligations.

     Section 10.9 Taxes. All payments of the Guaranteed Obligations will be made by each Loan
Guarantor free and clear of and without deduction for any Indemnified Taxes or Other Taxes;
provided that if any Loan Guarantor shall be required to deduct any Indemnified
Taxes or Other Taxes from such payments, then (a) the sum payable shall be increased as necessary
so that after making all required deductions (including deductions applicable to additional sums
payable under this Section) the Administrative Agent, Lender, Issuing Bank and any Other

112

 

 Secured
Parties (as the case may be) receives an amount equal to the sum it would have received had no such
deductions been made, (b) such Loan Guarantor shall make such deductions and (c) such Loan
Guarantor shall pay the full amount deducted to the relevant Governmental Authority in accordance
with applicable law.

     Section 10.10 Maximum Liability. The provisions of this Loan Guaranty are severable, and
in any action or proceeding involving any state corporate law, or any state, federal or foreign
bankruptcy, insolvency, reorganization or other law affecting the rights of creditors generally, if
the obligations of any Loan Guarantor under this Loan Guaranty would otherwise be held or
determined to be avoidable, invalid or unenforceable on account of the amount of such Loan
Guarantor’s liability under this Loan Guaranty, then, notwithstanding any other provision of this
Loan Guaranty to the contrary, the amount of such liability shall, without any further action by
the Loan Guarantors, the Lenders or any Other Secured Parties, be automatically limited and reduced
to the highest amount that is valid and enforceable as determined in such action or proceeding
(such highest amount determined hereunder being the relevant Loan Guarantor’s “Maximum
Liability”. This Section with respect to the Maximum Liability of each Loan Guarantor is
intended solely to preserve the rights of the Lenders to the maximum extent not subject to
avoidance under applicable law, and no Loan Guarantor nor any other person or entity shall have any
right or claim under this Section with respect to such Maximum Liability, except to the extent
necessary so that the obligations of any Loan Guarantor hereunder shall not be rendered voidable
under applicable law. Each Loan Guarantor agrees that the Guaranteed
Obligations may at any time and from time to time exceed the Maximum Liability of each Loan
Guarantor without impairing this Loan Guaranty or affecting the rights and remedies of the Lenders
or any Other Secured Parties hereunder, provided that, nothing in this sentence
shall be construed to increase any Loan Guarantor’s obligations hereunder beyond its Maximum
Liability.

     Section 10.11 Contribution. In the event any Loan Guarantor (a “Paying Guarantor”)
shall make any payment or payments under this Loan Guaranty or shall suffer any loss as a result of
any realization upon any collateral granted by it to secure its obligations under this Loan
Guaranty, each other Loan Guarantor (each a “Non-Paying Guarantor”) shall contribute to
such Paying Guarantor an amount equal to such Non-Paying Guarantor’s Applicable Percentage of such
payment or payments made, or losses suffered, by such Paying Guarantor. For purposes of this
Article X, each Non-Paying Guarantor’s Applicable Percentage with respect to any such payment or
loss by a Paying Guarantor shall be determined as of the date on which such payment or loss was
made by reference to the ratio of (a) such Non-Paying Guarantor’s Maximum Liability as of such date
(without giving effect to any right to receive, or obligation to make, any contribution hereunder)
or, if such Non-Paying Guarantor’s Maximum Liability has not been determined, the aggregate amount
of all monies received by such Non-Paying Guarantor from the Borrowers after the date hereof
(whether by loan, capital infusion or by other means) to (b) the aggregate Maximum Liability of all
Loan Guarantors hereunder (including such Paying Guarantor) as of such date (without giving effect
to any right to receive, or obligation to make, any contribution hereunder), or to the extent that
a Maximum Liability has not been determined for any Loan Guarantor, the aggregate amount of all
monies received by such Loan Guarantors from the Borrowers after the date hereof (whether by loan,
capital infusion or by other means). Nothing in this provision shall affect any Loan Guarantor’s
several liability for the entire amount of the Guaranteed Obligations (up to such Loan Guarantor’s
Maximum Liability). Each of the

113

 

Loan Guarantors covenants and agrees that its right to receive any
contribution under this Loan Guaranty from a Non-Paying Guarantor shall be subordinate and junior
in right of payment to the payment in full in cash of the Guaranteed Obligations. This provision
is for the benefit of all of the Agents, the Issuing Bank, the Lenders any Other Secured Parties
and the Loan Guarantors and may be enforced by any one, or more, or all of them in accordance with
the terms hereof.

     Section 10.12 Liability Cumulative. The liability of each Loan Party as a Loan Guarantor
under this Article X is in addition to and shall be cumulative with all liabilities of each Loan
Party to the Agents, the Issuing Bank, any Other Secured Parties and the Lenders under this
Agreement and the other Loan Documents to which such Loan Party is a party or in respect of any
obligations or liabilities of the other Loan Parties, without any limitation as to amount, unless
the instrument or agreement evidencing or creating such other liability specifically provides to
the contrary.

114

 

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by
their respective authorized officers as of the day and year first
above written.

	 	 	 	 	 	 	 	 	 
	 	 	STEWART & STEVENSON LLC, a Delaware
limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Hushang Ansary	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Hushang Ansary, Chairman	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	STEWART & STEVENSON DISTRIBUTOR
HOLDINGS LLC, a Delaware limited liability
company	 	 
	 	 	By:	 	Stewart & Stevenson LLC, its sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Hushang Ansary
 

Hushang Ansary, Chairman
	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	STEWART & STEVENSON POWER
PRODUCTS LLC, a Delaware limited liability
company	 	 
	 	 	By:	 	Stewart & Stevenson LLC, its sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Hushang Ansary
 

Hushang Ansary, Chairman
	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	STEWART & STEVENSON PETROLEUM
SERVICES LLC, a Delaware limited liability
company	 	 
	 	 	By:	 	Stewart & Stevenson LLC, its sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Hushang Ansary
 

Hushang Ansary, Chairman
	 	 

[Signature Page to Amended and Restated Credit Agreement]

 

 

	 	 	 	 	 	 	 	 	 
	 	 	STEWART & STEVENSON CORP., a Delaware corporation	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Hushang Ansary	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Hushang Ansary, Chairman	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	S&S AGENT LLC, a Delaware limited liability
company	 	 
	 	 	By:	 	Stewart & Stevenson LLC, its sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Hushang Ansary
 

Hushang Ansary, Chairman
	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A., individually as a Lender,
as the Administrative Agent, the
Collateral Agent, the Issuing Bank and the
Swingline Lender	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Lawrence J. Cannarioto	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Lawrence J. Cannarioto	 	 
	 	 	Title:	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	THE CIT GROUP/BUSINESS CREDIT, INC., as a Lender	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Jon Eckhouse	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Jon Eckhouse	 	 
	 	 	Title:	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	PNC BANK, NATIONAL
ASSOCIATION, as a Lender	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Kay Snyder	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Kay Snyder	 	 
	 	 	Title:	 	Relationship Manager	 	 

[Signature Page to Amended and Restated Credit Agreement]

 

 

	 	 	 	 	 	 	 	 	 
	 	 	COMERICA BANK, as a Lender	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Charles T. Johnson	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Charles T. Johnson	 	 
	 	 	Title:	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	SUNTRUST BANK, as Lender	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Mark Pickering	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Mark Pickering	 	 
	 	 	Title:	 	Vice President	 	 

[Signature Page to Amended and Restated Credit Agreement]

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