Document:

exv4wd

 

Exhibit 4D

Amended and Restated

Loan and Security Agreement

dated as of December 20, 2007

among

E-One, Inc., 

Elgin Sweeper Company, Vactor Manufacturing Inc.

and E-One New York, Inc., 

Each as a Borrower,

and

Banc of America Leasing & Capital, LLC,

as Lender

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	 
	 	 	 	 	 	 	 	 
	Article I	 	Loans	 	 	2	 
	 
	 	Section 1.1	 	Uncommitted Loan Facility	 	 	2	 
	 
	 	Section 1.2	 	Loan Account(s)	 	 	4	 
	 
	 	Section 1.3	 	Interest	 	 	5	 
	 
	 	Section 1.4	 	Designated Representative; Authorized Persons	 	 	6	 
	 
	 	Section 1.5	 	Change of Circumstances	 	 	6	 
	 
	 	Section 1.6	 	Taxes on Payments	 	 	7	 
	 
	 	Section 1.7	 	Tax Characteristics of Leases	 	 	7	 
	 
	 	 	 	 	 	 	 	 
	Article II	 	Payments And Collections	 	 	7	 
	 
	 	Section 2.1	 	Repayment of Loans; Payment of Other Amounts	 	 	7	 
	 
	 	Section 2.2	 	Establishment of Lock-Box and Lock-Box Account	 	 	8	 
	 
	 	Section 2.3	 	Collections to be Directed to Lock-Box and Lock-Box Account	 	 	8	 
	 
	 	Section 2.4	 	Application of Collections and Other Payments	 	 	9	 
	 
	 	Section 2.5	 	Rate Compression Payments and Other Mandatory Prepayments	 	 	12	 
	 
	 	Section 2.6	 	Optional Prepayments	 	 	12	 
	 
	 	Section 2.7	 	Multiple Borrowers; Several and Not Joint Liability	 	 	12	 
	 
	 	 	 	 	 	 	 	 
	Article III	 	Security	 	 	13	 
	 
	 	Section 3.1	 	Collateral	 	 	13	 
	 
	 	Section 3.2	 	Cash Collateral	 	 	13	 
	 
	 	Section 3.3	 	Documentation; Fees	 	 	13	 
	 
	 	Section 3.4	 	Verifications and Retitling	 	 	14	 
	 
	 	Section 3.5	 	Cross Collateralization	 	 	14	 
	 
	 	Section 3.6	 	Release of Lien	 	 	14	 
	 
	 	 	 	 	 	 	 	 
	Article IV	 	Representations And Warranties	 	 	15	 
	 
	 	Section 4.1	 	Representations and Warranties	 	 	15	 
	 
	 	 	 	 	 	 	 	 
	Article V	 	Limitations on Recourse; Repurchase and Substitution of Leases	 	 	19	 
	 
	 	Section 5.1	 	Limitations on Recourse	 	 	19	 
	 
	 	Section 5.2	 	Substitutions	 	 	19	 
	 
	 	 	 	 	 	 	 	 
	Article VI	 	Conditions Precedent	 	 	20	 
	 
	 	Section 6.1	 	Conditions Precedent to Lender's Execution	 	 	21	 
	 
	 	Section 6.2	 	Conditions Precedent to All Requests for Funding of an Advance or Substitution	 	 	21	 

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	 	 	 	 	 	 	Page	 
	 
	 	 	 	 	 	 	 	 
	 
	 	Section 6.3	 	Conditions Subsequent to Lender's Execution	 	 	22	 
	 
	 	 	 	 	 	 	 	 
	Article VII	 	Covenants	 	 	22	 
	 
	 	Section 7.1	 	Affirmative Covenants	 	 	22	 
	 
	 	Section 7.2	 	Negative Covenants	 	 	25	 
	 
	 	 	 	 	 	 	 	 
	Article VIII	 	Administration And Collection	 	 	26	 
	 
	 	Section 8.1	 	Designation of Servicer	 	 	26	 
	 
	 	 	 	 	 	 	 	 
	Article IX	 	Events Of Default	 	 	27	 
	 
	 	Section 9.1	 	Events of Default	 	 	27	 
	 
	 	Section 9.2	 	Remedies	 	 	29	 
	 
	 	 	 	 	 	 	 	 
	Article X	 	Indemnification	 	 	29	 
	 
	 	Section 10.1	 	Indemnities	 	 	29	 
	 
	 	Section 10.2	 	Excluded Amounts	 	 	31	 
	 
	 	 	 	 	 	 	 	 
	Article XI	 	Assignments; Participations	 	 	32	 
	 
	 	Section 11.1	 	Assignments	 	 	32	 
	 
	 	Section 11.2	 	Participations	 	 	32	 
	 
	 	Section 11.3	 	Disclosures	 	 	33	 
	 
	 	Section 11.4	 	Pledges	 	 	33	 
	 
	 	 	 	 	 	 	 	 
	Article XII	 	Miscellaneous	 	 	33	 
	 
	 	Section 12.1	 	Waivers and Amendments	 	 	33	 
	 
	 	Section 12.2	 	Notices	 	 	33	 
	 
	 	Section 12.3	 	Revival of Voidable Transfers	 	 	33	 
	 
	 	Section 12.4	 	Protection of Interests of Lender	 	 	34	 
	 
	 	Section 12.5	 	Confidentiality	 	 	34	 
	 
	 	Section 12.6	 	Set-off	 	 	35	 
	 
	 	Section 12.7	 	Limitation of Liability; Knowledge of Lender	 	 	36	 
	 
	 	Section 12.8	 	Choice of Law	 	 	36	 
	 
	 	Section 12.9	 	Consent to Jurisdiction	 	 	36	 
	 
	 	Section 12.10	 	Waiver Of Jury Trial	 	 	37	 
	 
	 	Section 12.11	 	Integration; Binding Effect; Survival of Terms	 	 	37	 
	 
	 	Section 12.12	 	Interpretive Provisions	 	 	37	 
	 
	 	Section 12.13	 	Counterparts; Severability	 	 	38	 

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Exhibits And Schedules

	 	 	 	 	 
	Exhibit I

	 	-
	 	Definitions
	Exhibit II

	 	-
	 	Form of Request for Approval of Leases and Terms
	Exhibit III-A

	 	-
	 	Form of Request for Funding
	Exhibit III-B

	 	-
	 	Form of Request for Substitution
	Exhibit IV

	 	-
	 	[Intentionally Omitted]
	Exhibit V

	 	-
	 	Form of Lock-Box Control Agreement
	Exhibit VI

	 	-
	 	Form of Amended and Restated Servicing and Title Agency Agreement
	Exhibit VII

	 	-
	 	Lease Form(s)
	Exhibit VIII

	 	-
	 	Form of Amended and Restated FSS Guaranty
	Exhibit IX

	 	-
	 	Form of Monthly Servicing Report
	 
	 	 	 	 
	Schedule A-1

	 	-
	 	Documents to be Delivered to the Lender on or prior to the Closing Date
	Schedule A-2

	 	 	 	Documents to be Delivered to the Lender after the Closing Date
	Schedule B

	 	-
	 	Legal Name; Jurisdiction of Organization; Places of Business of the Company Parties; Locations of
Records; Federal Employer Identification Number(s)
	Schedule C

	 	-
	 	Information Re: Lock-Box Account
	Schedule D

	 	-
	 	Authorized Persons and Designated Representative

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Amended and Restated Loan And Security Agreement

     This Amended and Restated Loan and Security Agreement (“Agreement”) is dated as of December
20, 2007 and is entered into by E-One, Inc., a Delaware corporation (“E-One”), Elgin Sweeper
Company, a Delaware corporation (“Elgin”), Vactor Manufacturing Inc., an Illinois corporation
(“Vactor”), E-One New York, Inc. (formerly known as Saulsbury Fire Rescue, Inc.), a New York
corporation (“EONY”; E-One, Elgin, Vactor and EONY shall be collectively referred to herein as the
“Borrowers” and each individually as a “Borrower”), and Federal Signal Corporation, a Delaware
corporation (“FSS”), as Designated Representative on behalf of each Borrower, Banc of America
Leasing & Capital, LLC (“Lender”), as Lender. Unless otherwise specifically defined herein, any
capitalized term used in this Agreement shall have the meaning assigned to such term in Exhibit
I.

Preliminary Statements

     E-One and Lender are parties to that Loan and Security Agreement dated as of March 24, 2005
(the “Existing Loan and Security Agreement”). The obligations of E-One to Lender under the
Existing Loan and Security Agreement are secured by a first priority security interest in the
Collateral (as defined in the Existing Loan and Security Agreement). E-One and certain of its
Affiliates have requested that Lender agree to amend and restate the Existing Loan and Security
Agreement to provide, among other things, for uncommitted loan facilities to each of the Borrowers.

     Each Borrower has requested that Lender make a nonrecourse loan to such Borrower in connection
with the funding of a pool of Leases (as defined herein) in which such Borrower has an interest. A
Borrower may from time to time request that Lender make additional loans to that Borrower to fund
additional Leases. As collateral for each Borrower’s indebtedness and other obligations hereunder,
each Borrower, among other things, assigns and pledges to Lender all of its right, title and
interest in, to and under the Leases and the other Collateral as described herein.

     The Borrowers and Lender are willing to enter into this Agreement to describe the terms and
conditions of any loans or financial accommodations that are provided by Lender to the Borrowers,
provided, however, that each Borrower acknowledges and agrees that Lender has no obligation to make
any loans or provide other financial accommodations to any of the Borrowers under this Agreement
and may, in its sole discretion, make or refuse to make any loans or provide other financial
accommodations to any Borrower.

     Now, Therefore, in consideration of the mutual conditions and agreements set forth
herein, and for good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:

 

 

Article I
Loans

     Section 1.1 Uncommitted Loan Facility.

     (a) Term Loans. Subject to the terms and conditions of this Agreement, Lender hereby
agrees to consider a Borrower’s request for Advances in the amounts
designated by that Borrower and agreed to by Lender, which shall be made, if at all, on any
Business Day as designated by the Borrower and agreed to by Lender.

     (b) Amount of Advances.

     (i) The principal amount of each Advance shall be equal to the product of the
Advance Rate and the NPV of all Eligible Leases designated as Collateral on the
Request for Funding and confirmed as approved by Lender on the Lease and Terms
Approval. Such NPV shall be calculated as of the Cut-Off Date immediately prior to
the date such Advance is made by Lender.

     (ii) In addition, at no time shall any Borrower request any Advance, nor shall
any Advance be available, with respect to any Lease unless at the time of the
Request for Funding and at the time of the Advance all of the following are true:

     (A) each Lease designated as Collateral therefor on the Request for
Funding is an Eligible Lease and was the subject of a Lease and Terms
Approval; and

     (B) all conditions set forth in Article VI have been and remain
satisfied.

All of the foregoing shall be determined by Lender upon receipt and review of the related
Request for Approval of Leases and Terms and the Request for Funding required hereunder and
such other documents, collateral reports and servicing reports as Lender may from time to
time require.

     (c) Uncommitted Facility. Notwithstanding any other provision in this Agreement or in
any other Transaction Document, Lender shall have no obligation to make any Advance to any
Borrower or to provide other financial accommodations to any Borrower or agree to any
Substitution and may, in its sole discretion, make or refuse to make any Loans or provide or
refuse to provide other financial accommodations requested hereunder or consent or refuse to
consent to any Substitution.

     (d) Requests for Approval of Leases and Terms. A Borrower, through one of its
Authorized Persons (including a Designated Representative), may from time to time in its
discretion submit to Lender a written request in the form of Exhibit II attached
hereto for approval of Leases to be pledged as collateral in connection with an Advance
hereunder (each, a “Request for Approval of Leases and Terms”). Each such request shall

2

 

include the following information regarding the Leases proposed for inclusion as Collateral
for that Advance:

     (i) an identification number for each Lease;

     (ii) information regarding the proposed Obligor(s), including legal name,
address and such credit underwriting information in the Borrowers’ possession as
Lender may reasonably request;

     (iii) a description of each Vehicle and any other goods constituting Related
Equipment;

     (iv) for each Lease, the Original Equipment Cost, the start date, the current
maturity date, the dollar amount, number and frequency of the remaining Scheduled
Payments, and the aggregate gross balance of all remaining Scheduled Payments;

     (v) the proposed Cut-Off Date applicable to all Leases to be included as
Collateral for such Advance;

     (vi) with respect to all Leases documented after the date of the Existing Loan
and Security Agreement, identification of any proposed deviations from the standard
lease forms attached hereto as Exhibit VII (or any superceding exhibit of
standard lease forms proposed by the Borrowers and approved by Lender);

     (vii) identification of the applicable Borrower with respect to each Lease; and

     (viii) such additional information as Lender may reasonably request.

Upon receipt of a Request for Approval of Leases and Terms, Lender and the applicable
Borrower shall agree on such further information and due diligence review for the proposed
Leases identified therein, including such business, credit, legal and administrative review
as Lender may request. Lender may in its sole discretion accept or decline all or any of
the Leases proposed as Collateral for the Advance or the other terms proposed in the Request
for Approval of Leases and Terms, for any reason and without stating any reason. In the
event that Lender approves all or any portion of any Request for Approval of Leases and
Terms, Lender will notify the Borrower requesting such Advance in writing of such approval
(each, a “Lease and Terms Approval"). Each Lease and Terms Approval shall include the
identification number and Obligor name for each of the approved Leases and the agreed upon
Applicable Margin, estimated Discount Rate and estimated Advance amount, with respect to
each approved Lease. Subject to there being no material adverse change with respect to any
Company Party or any Obligor after such approval and prior to the Advance (but without
limiting Lender’s discretion with respect to making or declining to make any Loan), each
Lease and Terms Approval shall be valid for a period of thirty (30) days from its date of
issuance by Lender.

3

 

     (e) Request for Funding of Advances. The applicable Borrower(s), through one of its
respective Authorized Persons (which may be a Designated Representative), shall request an
Advance or Conversion hereunder by giving Lender irrevocable written notice, in the form of
Exhibit III-A attached hereto (each, a “Request for Funding”), which shall include,
among other things:

     (i) the proposed date of the Advance or Conversion, which shall be a Business
Day;

     (ii) a schedule of the Leases related to such Advance;

     (iii) the estimated principal amount of the requested Advance and the estimated
NPV of each related Lease calculated as of the date of such Advance; and

     (iv) whether such Advance will be a LIBOR Loan or a Fixed Rate Loan and
confirmation of the Applicable Margin.

Each Request for Funding must be received by Lender not later than 11:00 a.m. (Chicago time)
at least five (5) Business Days prior to the date of the requested Advance. Any Request for
Funding delivered after 11:00 a.m. shall be deemed received on the next Business Day.

     (f) Existing Loans. This Agreement amends and restates in its entirety the Existing
Loan and Security Agreement, and all Loans outstanding under the Existing Loan and Security
Agreement are, as of the Closing Date, deemed to be repaid and readvanced to E-One under
this Agreement, without further action or documentation. Such repayment and readvance shall
not be considered to be an optional prepayment for purposes of, and no premium shall be due
with respect thereto under, Section 2.6 of the Existing Loan and Security Agreement or
Section 2.6 of this Agreement. Nothing herein is intended to nor shall impair any of the
grant, attachment, perfection or priority of Lender in or to any of the Collateral (as
defined in the Existing Loan and Security Agreement). In addition, Section 12.11(b) of the
Existing Loan and Security Agreement, and each of the obligations described in the proviso
thereof, shall continue and survive as obligations of E-One, notwithstanding the execution
and delivery of this Agreement or any of the other Transaction Documents.

     Section 1.2 Loan Account(s). Lender shall maintain an account on its books in the name of
each Borrower (the “Loan Account”) on which the applicable Borrower will be charged with all
Advances made by Lender to that Borrower or for such Borrower’s account and with all other
Obligations hereunder or under the other Transaction Documents that by the terms hereof or thereof
are for the account of or allocable to such Borrower, including, accrued interest, fees and Lender
Expenses. In accordance with Section 2.3(c), each Loan Account will be credited with all payments
received by Lender from or for the account of the applicable Borrower, including all amounts
received in the Lender’s Account from the Lender’s Account Bank. Lender shall render statements
regarding the Loan Accounts to the Borrowers, including

4

 

principal, interest, fees, and including an itemization of all charges and expenses constituting
Lender Expenses owing, and such statements shall be conclusively presumed to be correct and
accurate and constitute an account stated between the Borrowers and Lender unless, within sixty
(60) days after receipt thereof by the applicable Borrower, such Borrower shall deliver to Lender
written objection thereto describing the error or errors contained in any such statements. Any
failure by Lender to record or any error in doing so shall not, however, limit or otherwise affect
any obligation of any of the Borrowers hereunder or under any other Transaction Document.

     Section 1.3 Interest.

     (a) Rate of Accrual. Each Borrower may elect to have any Loan to such Borrower bear
interest at the LIBOR Interest Rate or the Fixed Interest Rate (as such terms are defined
below); provided, however, that on the date of any Advance to or Conversion by a Borrower,
all outstanding Loans of that Type to such Borrower on such date shall be deemed to be
repaid and readvanced and shall bear interest at either the LIBOR Interest Rate or the Fixed
Interest Rate as designated by such Borrower with respect to such Advance or Conversion made
on that date. For the avoidance of doubt, a Borrower may have one, but only one, Loan of
each Type outstanding at any time. Any Conversion, and any Loan that is deemed repaid and
readvanced as the same Type of Loan, shall not be considered an optional prepayment for
purposes of, and no premium shall be due with respect thereto under, Section 2.6 of this
Agreement. Any Fixed Rate Loan that is deemed repaid and readvanced as a LIBOR Loan shall
be subject to Section 2.6 and the applicable Borrower shall pay to Lender the premium due
thereunder upon demand.

     (i) LIBOR Loans. LIBOR Loans shall accrue interest at a rate per annum
determined by Lender to be the LIBO Rate as in effect on the first day of each LIBOR
Interest Period plus the Applicable Margin (the “LIBOR Interest Rate”).

     (ii) Fixed Rate Loans. Fixed Rate Loans shall accrue interest at a rate per
annum determined by Lender to be the Fixed Rate as in effect as of the second
Business Day immediately prior to the date of the Fixed Rate Loan plus the
Applicable Margin (the “Fixed Interest Rate”).

     (b) Accrual Periods and Payment Dates. Interest on outstanding Loans and on other
Obligations then due and owing under this Agreement shall accrue daily and be payable from
Collections on each Business Day. Each Borrower hereby authorizes Lender, from time to time
without prior notice to any of the Borrowers, to charge such interest and fees, all Lender
Expenses (as and when incurred), and all other payments as and when due and payable under
any Transaction Documents to such Borrower’s Loan Account. On any Business Day Lender may
debit from the Lender’s Account all accrued interest on outstanding Loans that are unpaid on
such date.

     (c) Computation. All interest and fees hereunder shall be computed on the basis of a
three hundred sixty (360) day/twelve (12) month year and either actual days

5

 

elapsed during the accrual period, in the case of LIBOR Loans or if the accrual period is
less than one (1) month, or thirty (30) day months in the case of Fixed Rate Loans.

     (d) Default Interest. At all times that an Event of Default shall exist, the
outstanding Loans shall bear interest until Paid in Full at an increased rate per annum
(computed on the basis of a three hundred sixty (360) day year, actual days elapsed) equal
to two percent (2%) above the applicable Interest Rate.

     Section 1.4 Designated Representative; Authorized Persons.

     (a) Without limiting the several nature of the obligations of the Borrowers hereunder,
each Borrower hereby designates FSS as its representative and agent on its behalf (the
“Designated Representative”) for the purposes of submitting any Request for Approval of
Leases and Terms, giving notice of any Request for Funding, giving instructions with respect
to the disbursement of the proceeds of Advances, selecting interest rate options, delivering
financial and other reporting, giving and receiving all other notices and consents hereunder
or under any of the other Transaction Documents and taking all other actions on behalf of
any Borrower or Borrowers under the Transaction Documents. The Designated Representative
hereby accepts such appointment. Each of the Borrowers acknowledges that Lender is agreeing
to accept from and deliver notices and other communications to, and to take direction from
and transact with, the Designated Representative hereunder instead of each of the Borrowers
separately for the convenience of the Borrowers. Lender may regard any notice or other
communication pursuant to any Transaction Document from the Designated Representative as a
notice or communication from any or all Borrowers, as the context shall require, unless such
notice or communication expressly states to the contrary. Each Borrower agrees that the
Designated Representative is and will be authorized to act on such Borrower’s behalf, and
each warranty, covenant, agreement and undertaking purportedly made on its behalf by the
Designated Representative shall be deemed for all purposes to have been made by such
Borrower and shall be binding upon and enforceable against such Borrower to the same extent
as if the same had been made directly by such Borrower. Any reference in any provision of
this Agreement or other Transaction Documents to a Borrower or other Company Party rather
than to the Designated Representative shall not limit the applicability of this Section
1.4(a) to such provision.

     (b) Lender shall be entitled to rely conclusively on the authority of each Authorized
Person (including any Authorized Person of the Designated Representative). Lender shall
have no duty or obligation to the Borrowers to verify the authenticity of any signature
appearing on any Request for Funding or any other written notice from an Authorized Person
or to verify the authenticity of any Person purporting to be an Authorized Person giving any
telephonic notice permitted hereby.

     Section 1.5 Change of Circumstances.

     (a) Inability to Determine Rate. If Lender at any time after the date of this
Agreement shall determine that for any reason adequate and reasonable means do not

6

 

exist for ascertaining the LIBO Rate, or that the making or maintaining of any Loan at the LIBOR
Interest Rate shall be unlawful, then Lender shall give telephonic notice (promptly confirmed in
writing) to the Designated Representative of such determination. If such notice is given and until
such notice has been withdrawn in writing by Lender, Lender will not consider any request for a
LIBOR Loan until Lender and the Designated Representative agree upon an alternate floating rate and
an adjustment to the Applicable Margin, and Lender and the Designated Representative agree to
negotiate in good faith to agree upon such alternate rate and adjustment. Unless and until Lender
and the Designated Representative have agreed upon an alternate rate and an adjustment to the
Applicable Margin, any LIBOR Loans outstanding on the date of such notice shall thereafter accrue
interest at a per annum rate equal to the Interest Rate for such LIBOR Loans in effect as of the
date of such notice plus two percent (2%).

     (b) Charges: Illegality. Upon the occurrence of any event described in Section 1.5(a)
hereof, the applicable Borrower shall pay to Lender, as and when provided in Section 2.4(a),
such amount or amounts as may be necessary to compensate Lender for any fines, fees,
charges, penalties, increased costs or other amounts payable by Lender as a result thereof
and which are attributable to LIBOR Loans outstanding during periods prior to the date of
notice under Section 1.5(a). Lender shall provide the applicable Borrower written
certification of the amounts claimed but shall have no obligation to demonstrate match
funding with respect to such amounts.

     Section 1.6 Taxes on Payments. All payments made by the Borrowers under the Transaction
Documents shall be made free and clear of, and without deduction or withholding for or on account
of, any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees,
deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by
any governmental authority (except net income taxes imposed on Lender) (with all such non-excluded
taxes, levies, imposts, duties, charges, fees, deductions and withholdings being hereinafter
referred to herein as “Taxes”). The agreements in this Section 1.6 shall survive the termination
of this Agreement.

     Section 1.7 Tax Characteristics of Leases. Each of Lender and the Borrowers, on their own
behalf, expressly disclaim any representation or warranty with respect to the tax treatment to the
Borrowers, Lender, any other holder of the Leases or any other Person with respect to the
Receivables, the Collections, any other payment made under any Lease, the Loans or any transaction
contemplated hereby. Lender and the Borrowers intend that the Borrowers will be treated as the
owners of the Leases, respectively, for all tax purposes, and each of Lender and the Borrowers, on
its own behalf, agrees that it will consistently treat the Borrowers as the owners for all tax
filings and other tax purposes.

Article II Payments And Collections

     Section 2.1 Repayment of Loans; Payment of Other Amounts. Each Borrower shall cause all
applicable Collections to be applied to pay outstanding Loans to such Borrower and accrued and
unpaid interest thereon and any other Obligations of such Borrower then due hereunder. All such
amounts shall be applied to the outstanding Loans and other Obligations as

7

 

provided in Section 2.4.
In addition, each Borrower shall pay to Lender when due from sources other than Collections
(unless Lender otherwise elects) all Recourse Obligations owing by such Borrower. Notwithstanding
the foregoing, no provision of this Agreement shall require the payment or permit the collection of
any amounts hereunder in excess of the maximum permitted by applicable law.

     Section 2.2 Establishment of Lock-Box and Lock-Box Account. The Borrowers shall cooperate in
the establishment of one or more Lock-Boxes and related deposit accounts, each opened in Lender’s
name (each, a “Lock-Box Account”) with a Lock-Box Bank. No Company Party shall have any access to
or right to give directions with respect to the Lock-Box or the Lock-Box Account or any funds held
therein from time to time and all such accounts shall be held for and subject to the control of
Lender. Lender shall provide, or shall require the Lock-Box Bank to provide, to the Servicer
copies of all periodic Lock-Box detail promptly after it is available to Lender. Upon Payment in
Full of all Obligations, each Lock-Box and Lock-Box Account in Lender’s name shall be transferred
to the Servicer for distribution to the Company Parties entitled thereto. The Company Parties
shall cooperate with Lender and each Lock-Box Bank by submitting to a Lock-Box Control Agreement in
favor of Lender substantially in the form of Exhibit V. Such Lock-Box Control Agreement
shall provide, among other things, that (A) no Company Party shall have any access to or right to
give directions to the Lock-Box Bank with respect to the Lock-Box or the Lock-Box Account or any
funds held therein and (B) the Lock-Box Bank has no rights of set-off or recoupment or any other
claim against the Lock-Box Account other than for payment of its service fees and other charges
directly related to the administration of such Lock-Box and Lock-Box Account and for returned
checks or other items of payment. All Lock-Boxes, Lock-Box Accounts and Lock-Box Banks used to
receive Collections on the Collateral shall be identified on Schedule C hereto. The
Lock-Box Account shall be a cash collateral account, with all cash, checks and similar items of
payment in such account securing payment of the Obligations, and in which each of the Borrowers, to
the full extent of their respective interests therein (if any), hereby grants a Lien to Lender.

     Section 2.3 Collections to be Directed to Lock-Box and Lock-Box Account.

     (a) At all times prior to the date upon which the Obligations have been Paid in Full,
the Company Parties shall cause all payments by or on behalf of Obligors to be directed to
the Lock-Box and shall cause all Collections (including ACH Receipts, if any) to be
deposited into the Lock-Box Account; and not later than forty-five (45) days prior to the
next Scheduled Payment with respect to a Lease, the Borrowers shall (either themselves or
through the Servicer ) notify and direct each Obligor to remit all payments under or with
respect to such Obligor’s Lease and the Related Equipment directly to the
Lock-Box or (with respect to ACH Receipts) the Lock-Box Account. Any Collections received
directly by or processed by a Company Party (in its capacity as Servicer, Subservicer or
otherwise) shall be deposited into the Lock-Box Account no later than (i) in the case of any
ACH Receipts, immediately and (ii) in the case of all other Collections within five (5)
Business Days. All Collections received directly by the Servicer or a Company Party,
including early termination payments, shall be deposited into the Lock-Box Account in the
form received. Until such deposit, the applicable party shall hold all such Collections in
trust for the benefit of Lender.

8

 

     (b) Lender shall be authorized to direct the Lock-Box Bank to remit by daily sweep to a
bank account in Lender’s name (a “Lender’s Account”) at the Lender’s Account Bank on each
Business Day all available amounts on deposit in the Lock-Box Account. The Borrowers
irrevocably authorize Lender to apply on a daily basis all collected funds held in the
Lender’s Account to the Obligations in accordance with Section 2.4 hereof. The Company
Parties each acknowledge that none of them has nor will have any interest in Lender’s
Account or (except as provided in Section 2.3(d)) in any funds held therein from time to
time unless and until paid over to the applicable Borrower after Payment in Full of all of
its Obligations. To the extent that any of the Company Parties shall be deemed to have any
interest in any amounts held from time to time in the Lender’s Account, it shall be a cash
collateral account, with all cash, checks and similar items of payment in such account
securing payment of the Obligations (but subject to release to the applicable Borrower as
provided in Section 2.3(d)), and in which the Borrowers are hereby deemed to have granted a
Lien to Lender.

     (c) The receipt of any payment item by Lender (whether from transfers to Lender by any
Company Party, the Servicer or Subservicer, the Lock-Box Bank or otherwise) shall not be
considered a payment on account unless such payment item is a wire transfer of immediately
available federal funds made to the Lender’s Account or unless and until such payment item
is honored when presented for payment. Should any payment item not be honored when
presented for payment, then the applicable Borrower shall be deemed not to have made such
payment and interest shall be calculated accordingly. Anything to the contrary contained
herein notwithstanding, any payment item shall be deemed received by Lender only if it is
received into the Lender’s Account on a Business Day on or before 11:00 a.m. (Chicago time).
If any payment item is received into the Lender’s Account on a non-Business Day or after
11:00 a.m. (Chicago time) on a Business Day, it shall be deemed to have been received by
Lender as of the opening of business on the immediately following Business Day.

     (d) In the event that Lender is presented with written evidence demonstrating to
Lender’s reasonable satisfaction that any amounts credited to the Lockbox Account do not
constitute Collections or other payments made or proceeds received on account of
Obligations, Lender agrees promptly to transfer and return such funds to the applicable
Borrower, or in accordance with the written direction of the Servicer to the Person
designated by it as entitled to such funds, at such account or other place as the Servicer
may so instruct.

     Section 2.4 Application of Collections and Other Payments.

     (a) Priority of Application. Until all of the respective Obligations of the Borrowers
have been reduced to zero, all payments credited to the Lender’s Account and all
Collections, Deemed Collections or other proceeds of Collateral received and credited by
Lender on account of each Borrower (collectively, such Borrower’s “Payments”) shall be
applied to the Obligations of such Borrower, or paid to the applicable Borrower as set forth
below:

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     (i) So long as no Concentration Condition exists and no Event of Default exists
with respect to the applicable Borrower (or its Lease Pool) or FSS, in each instance
(except for payments made to the applicable Borrower as set forth in the second
application below or to Lender in the first or seventh applications below) with
respect to the Obligations arising under or related to each Loan or the related
Leases for which Advances or Substitutions were made, as follows:

first, to Lender, to pay or reimburse all Third-Party Servicer Costs
and Fees then due and payable by such Borrower;

second, to the applicable Borrower, any Over Collateralization amount
due to that Borrower with respect to such Borrower’s Lease Pool
without regard to the source of such payments;

third, to Lender, all accrued and unpaid interest then due hereunder
in respect of the related Loan, until Paid in Full;

fourth, to Lender, to repay the principal balance outstanding on such
related Loan until Paid in Full;

fifth, to Lender, to pay all accrued and unpaid interest then due
hereunder in respect of any other outstanding Loan made to such
Borrower, until Paid in Full (such application to interest in order
of the Advance dates for such Loans, most remote first);

sixth, to Lender, to repay the principal balance outstanding on any
other Loan made to such Borrower, until Paid in Full (such
application to principal in order of the Advance dates for such
Loans, most remote first);

seventh, to Lender, in satisfaction of any Recourse Obligations then
due from such Borrower; and

eighth, to the applicable Borrower (to be credited or wired to the
Borrower or such other Person entitled thereto under applicable law).

     (ii) If a Concentration Condition exists or an Event of Default exists with
respect to the applicable Borrower (or its Lease Pool) or FSS, all Payments received
by Lender with respect to a Borrower shall, until all Obligations owing by that
Borrower have been reduced to zero, be applied,

first, to Lender, to pay or reimburse all Third-Party Servicer Costs
and Fees then due from the applicable Borrower;

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second, upon Lender’s election, to Lender, to pay or to reimburse
Lender for its costs of collection and enforcement of the Collateral
with respect to the applicable Borrower, including any Servicer
Transition Costs, until Paid in Full;

third, upon Lender’s election, to Lender, to pay or to reimburse
Lender for any other Lender Expenses then due from such Borrower,
until Paid in Full;

fourth, upon Lender’s election, to Lender, to pay accrued fees, if
any, then due and payable to Lender by the applicable Borrower under
the terms of this Agreement or any of the other Transaction
Documents, until Paid in Full;

fifth, to Lender, to pay all accrued and unpaid interest then due
hereunder in respect of any Loan made to such Borrower, until Paid in
Full;

sixth, to Lender to repay any Loans made to such Borrower, to be
applied to such Loans in Lender’s discretion, until Paid in Full;

seventh, to Lender for payment or reimbursement of any other
Obligations then due from the applicable Borrower until Paid in Full;
and

eighth, to the applicable Borrower (to be credited or wired to such
Borrower or such other Person entitled thereto under applicable law).

     (b) Rules for Applying Application Priorities. In the event of a direct conflict
between the priority provisions of this Section 2.4 and other provisions contained in any
other Transaction Document, it is the intention of the parties hereto that such priority
provisions in such documents shall be read together and construed, to the fullest extent
possible, to be in concert with each other. In the event of any actual, irreconcilable
conflict that cannot be resolved, the terms and provisions of this Section 2.4 shall control
and govern.

     (c) [Omitted.]

     (d) Payment of Recourse Obligations. Except as may be otherwise provided in this
Agreement, each Borrower shall pay or reimburse to Lender all Recourse Obligations owing by
such Borrower then due not later than ten (10) Business Days after demand therefor. Such
payment shall be made to Lender in immediately available funds. If any Event of Default
with respect to such Borrower or FSS shall exist, Lender, in its sole discretion, may apply
Collections and other amounts of such Borrower on deposit in the Lender’s Account with
respect to the applicable Borrower on any Settlement Date to

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any of the Recourse Obligations
of such Borrower as provided in Section 2.4(a)(ii), but any election not to apply such
monies to Recourse Obligations shall not constitute a waiver of any right to collect any
Recourse Obligations.

     Section 2.5 Rate Compression Payments and Other Mandatory Prepayments.

     (a) Rate Compression. At the close of each LIBOR Interest Period, Lender shall
determine, with respect to each Borrower, (i) the amount of interest that accrued during
such LIBOR Interest Period on each LIBOR Loan for such Borrower at the LIBOR Interest Rate
and (ii) the amount of interest that would have accrued on such LIBOR Loans during that
LIBOR Interest Period if the interest rate applicable thereto during such period was equal
to the Discount Rate. If the aggregate interest under the foregoing clause (i) is greater
than the amount calculated under the foregoing clause (ii) (such excess, the “Rate
Compression Amount”), then the applicable Borrower shall pay or cause to be paid directly to
Lender on the next LIBOR Reset Date an amount equal to such Rate Compression Amount and such
amount shall be applied as provided by Section 2.4.

     (b) Payment of Deemed Collections. Each Borrower shall pay, or cause to be paid, to
the Lender’s Account not later than one (1) Business Day immediately prior to each
Settlement Date, all Deemed Collections applicable to such Borrower, if any, with respect to
events that have occurred on or before the last day of the calendar month preceding such
Settlement Date. All Deemed Collections shall be deposited into the Lender’s Account in
immediately available funds. Until such deposit, the Borrowers shall hold all such Deemed
Collections in trust for the benefit of Lender.

     (c) Payment of Release Price. If at any time any Borrower is required to pay or cause
to be paid the Release Price with respect to any Lease, such Release Price shall be
deposited into the Lender’s Account not later than one (1) Business Day immediately prior to
the first Settlement Date occurring after such requirement arises.

     Section 2.6 Optional Prepayments. Any Borrower may prepay any related outstanding Loan in
whole (but not in part) at any time upon prior notice to Lender (such notice if received subsequent
to 11:00 a.m. (Chicago time) on a given day to be treated as though received at the opening of
business on the next Business Day) by paying to Lender an amount equal to, in the case of an
outstanding Fixed Rate Loan, one hundred four percent (104%) of such Fixed Rate Loan, and in the
case of an outstanding LIBOR Loan, one hundred and five-tenths of one percent (100.5%) of such
LIBOR Loan, together in each case with all accrued and unpaid interest thereon to the date of
prepayment plus any related amounts due Lender under Section 2.1 hereof. Any notice of prepayment
given to Lender under this Section shall be irrevocable.

     Section 2.7 Multiple Borrowers; Several and Not Joint Liability. Each of the Borrowers
acknowledges and agrees that it has requested Lender to enter into this Agreement rather than
multiple agreements with the several Borrowers as a matter of convenience for the Company Parties.
Lender and each Borrower hereby unconditionally and irrevocably agrees that each Borrower is
severally (and not jointly) liable to Lender for the payment and performance of

12

 

the Recourse Obligations of that Borrower. Each Borrower acknowledges and agrees that its several liability on
the Recourse Obligations owed by that Borrower under this Agreement is absolute and unconditional
and shall not in any manner be affected or impaired by any acts or omissions whatsoever by Lender.
Without limiting the generality of the foregoing, each Borrower’s liability on its Recourse
Obligations shall not be impaired by any failure by, or any neglect or omission on Lender’s part to
resort to, any one or all of the other Borrowers for payment of any of such other Borrower’s
several Recourse Obligations or by the dissolution of or any other matters relating to any other
Borrower or its Lease Pool. However, the parties hereto agree that, if any of the Borrowers shall
owe any Recourse Obligations to Lender, such Recourse Obligations shall be the several obligations
of the Borrowers obligated thereunder, and shall not be joint obligations. Each Borrower’s several
liability on the Recourse Obligations shall not in any manner be impaired or affected by which
Company Party receives or uses the proceeds of any Loan or for what purposes any Loan is used,
because such matters are for the Company Parties to determine as among themselves. The foregoing
shall not limit Lender’s rights, interest or recourse to any of the Collateral or any FSS Guaranty.

Article III Security

     Section 3.1 Collateral. Each Borrower grants to Lender, as security for all Loans to and
other Obligations of that Borrower to Lender pursuant to this Agreement and the other Transaction
Documents, but subject to Section 3.5, a Lien of first priority in all of such Borrower’s right,
title and interest whether now existing or hereafter acquired or arising in, to and under all of
the Leases, the Receivables, the Collections, the Related Equipment and the Related Security with
respect to such Leases, the Lease Files, all of such Borrower’s right, title and interest in, to
and under the Lock-Box (if any) and the Servicing Agreement and each other Transaction Document
under which such Borrower has any rights or benefits, and any and all proceeds of any of the
foregoing (collectively, together with any collateral granted to Lender pursuant to Section 3.2,
the “Collateral”).

     Section 3.2 Cash Collateral. The Borrowers hereby each pledge to Lender a Lien on the
Lock-Box Account (s) (and, to the extent that such Borrower is deemed to have any interest therein,
on the Lender’s Account) and all funds from time to time held therein, as cash collateral for the
payment of all of such Borrower’s Loans and the payment and performance of all of such Borrower’s
Obligations under this Agreement and the other Transaction Documents, whether or not contingent or
inchoate. The Borrowers shall be entitled to a release of that portion of funds held on deposit in
the Lender’s Account as and when provided in Section 2.4.

     Section 3.3 Documentation; Fees. The Borrowers agree to cooperate fully with Lender and
perform all additional acts reasonably requested by Lender to effect the purposes of this Article
III. Without limiting the foregoing, the Borrowers shall execute and deliver and cause to be
executed and delivered such further agreements, documents and instruments and shall take and cause
to be taken such further actions in connection with any of the Collateral (including the cash
Collateral) and the perfection and priority of Lender’s Lien thereon as Lender may reasonably
request. The Borrowers shall reimburse Lender, immediately upon demand, for all costs and expenses
incurred by Lender in connection with any of the foregoing security, including without limitation
filing and recording fees.

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     Section 3.4 Verifications and Retitling. After an Event of Default or a Termination Event has
occurred, Lender may at any time, in its own name, in the name of the applicable Borrower or in the
name of any other Person, communicate with any Obligors in respect of Collateral to verify with
such Obligors, to Lender’s sole satisfaction, the existence, amount and terms of any Leases or
other Collateral and to update lien notations on the Certificates of Title to reflect the
applicable Borrower, the Borrower as agent or Lender as lienholder, as Lender may request. In
addition, with respect to any Lease identified on the schedule to the Request for Funding with
respect to the Initial Leases, Lender may request, at any time after such Initial Lease becomes a
Defaulted Lease (unless stayed as the result of the related Obligor’s Insolvency Proceeding), that
the Certificate of Title reflect E-One, E-One as agent or Lender as lienholder on the Related
Equipment under such Lease, as Lender may direct. Each Borrower agrees to cooperate with Lender in
any retitling of any Related Equipment subject to a Certificate of Title requested by Lender in
accordance with this Section 3.4.

     Section 3.5 Cross Collateralization. Notwithstanding any other provision of this Agreement or
any other Transaction Document, all Collateral in which a Borrower has any interest shall secure
all Loans and other Obligations, including Recourse Obligations, of that Borrower to Lender, but
Loans and other Obligations of a Borrower shall not be secured by Collateral in which such Borrower
has no interest; provided, however, that Collections with respect to Leases shall be released to
the Borrowers on each Settlement Date as and to the extent provided under Section 2.4.

     Section 3.6 Release of Lien. Lender agrees that in the event that (a) any Lease is paid in
full by the related Obligor and such payments (including any Deemed Collections) are not less than
the Release Price with respect to such Lease, or (b) the Lender has received from a Borrower the
Release Price in accordance with Section 2.5(c) with respect to any Lease for which a Borrower is
entitled or required to obtain a release, or (c) any Lease shall cease to be a Lease hereunder as a
result of a Substitution, Lender’s Lien arising under this Agreement in such Lease and the Related
Security, including the Related Equipment, shall be released, and, upon Payment in Full of all of
the Obligations, Lender’s Lien in the Collateral shall be released. Lender shall, at the
applicable Borrower’s expense and request, promptly execute and deliver to such Borrower such
instruments as are necessary to evidence such release. With respect to any Lease for which a Lien
release is requested in a Monthly Servicing Report that is timely delivered pursuant to Section
7.1(a)(ii) to Lender, (1) the Borrowers shall be entitled to execute and deliver such documents and
instruments in connection with a release of a Lien on any Related Security, including the Related
Equipment, at any time after the Settlement Date immediately following delivery of such Monthly
Servicing Report, unless the Designated Representative has received notice from Lender disapproving
such release on or before such Settlement Date, and (2) Lender shall deliver to the Designated
Representative by not later than the last day of the calendar month (or, if not a Business Day, the
immediately following Business Day), after the receipt of such Monthly Servicing Report, each
related Lease File then in Lender’s possession. Lender agrees to cooperate with the applicable
Borrower, at the request of the Designated Representative, to expedite Lender’s delivery of
instruments and documents to be delivered by it in connection with any Lien released under this
Section if, in Lender’s reasonable discretion, it would not be burdensome on Lender to do so.

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Article IV Representations And Warranties

     Section 4.1 Representations and Warranties. Each of the Borrowers, on its own behalf except
as otherwise expressly stated, hereby represents and warrants to Lender, as of the date hereof, as
of the date of each Request for Funding given by such Borrower, as of the date of each Advance to
such Borrower and as of the date of each Substitution made by such Borrower:

     (a) Existence; Authorization.

     (i) Corporate Existence and Power. Such Borrower is a corporation, duly
organized, validly existing and in good standing under the laws of its state of
organization, and is duly qualified to do business and is in good standing as a
foreign corporation, and has and holds all corporate power and all governmental
licenses, authorizations, consents and approvals required to carry on its business
in each jurisdiction in which its business is conducted, except where the failure to
be so qualified or to so hold would not reasonably be expected to have a Material
Adverse Effect.

     (ii) Power and Authority; Due Authorization, Execution and Delivery. The
execution and delivery by such Borrower of this Agreement and each other Transaction
Document to which it is a party, and the performance of its obligations hereunder
and thereunder and such Borrower’s use of the proceeds of Loans made hereunder, are
within its corporate powers and authority and have been duly authorized by all
necessary corporate action on its part. This Agreement and each other Transaction
Document to which such Borrower is a party have been duly executed and delivered by
such Borrower.

     (b) No Conflict. The execution and delivery by such Borrower of this Agreement and
each other Transaction Document to which it is a party, and the performance of its
obligations hereunder and thereunder do not (i) violate any provision of federal, state, or
local law, rule or regulation applicable to it, its Governing Documents, or any order,
judgment, or decree of any court or other Governmental Authority binding on it, (ii)
conflict with, result in a breach of, or constitute (with due notice or lapse of time or
both) a default under any material contractual obligation of such Borrower, (iii) result in
or require the creation or imposition of any Lien of any
nature whatsoever upon any of the Collateral (except as created hereunder), or (iv) require
any approval of any of such Borrower’s stockholders or the approval of any other Person
under any material contractual obligation of such Borrower that has not already been
obtained. No transaction contemplated hereby requires compliance by that Borrower with any
bulk sales act or similar law.

     (c) Governmental Authorization. Other than the filing of the financing statements
required hereunder, no authorization or approval or other action by, and no notice to or
filing with, any Governmental Authority that has not been obtained is required for the due
execution and delivery by such Borrower of this Agreement and each

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other Transaction
Document to which it is a party and the performance of its obligations hereunder and
thereunder.

     (d) Actions, Suits.

     (i) Except as described in the Forms 10-K, 10-Q and 8-K of FSS, there are no
actions, suits or proceedings pending or, to its knowledge, threatened, against or
affecting such Borrower, or any of its properties, in or before any court,
arbitrator or other body that, individually or in the aggregate, would reasonably be
expected to have a Material Adverse Effect. No Borrower is in default with respect
to any order of any court, arbitrator or governmental body binding upon it or any of
its properties.

     (ii) As of the date of any Advance or Substitution with respect to a Lease, no
action, suit or proceeding that is described in the Forms 10-K, 10-Q or 8-K of FSS
relates specifically to such Lease and the Related Equipment in the Collateral or
the Obligors thereon.

     (e) Binding Effect. This Agreement and each other Transaction Document to which such
Borrower is a party, constitute the legal, valid and binding obligations of such Borrower
enforceable against it in accordance with their respective terms, except as such enforcement
may be limited by applicable bankruptcy, insolvency, reorganization or other similar laws
relating to or limiting creditors’ rights generally and by general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity or at law).

     (f) Accuracy of Information. All written information furnished by such Borrower with
respect to a Company Party to Lender under or in connection with this Agreement or any of
the other Transaction Documents, including all information contained in the schedules hereto
and thereto, is true and accurate in all material respects on the date such information is
or is deemed to be stated or certified and does not contain any material misstatement of
fact or omit to state any material fact necessary to make the statements contained therein
not misleading in any material respect as of the date stated or certified or deemed stated
or certified.

     (g) Use of Proceeds. The proceeds of any Loan made hereunder will be used solely for
lawful corporate purposes.

     (h) Perfection in Lender. This Agreement, together with the filing of the financing
statements in the appropriate UCC offices, is effective to grant to Lender (and Lender shall
acquire from each of the Borrowers) a valid and perfected first priority security interest
in all of the Collateral in which such Borrower has an interest, free and clear of any
Adverse Claim, except (i) as created by the Transaction Documents and (ii) with respect to
the Related Equipment, Permitted Liens.

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     (i) Legal Name; Jurisdiction of Organization; Places of Business. Such Borrower’s
legal name and jurisdiction of organization are correctly set forth on Schedule B.
The principal places of business and chief executive offices of each of the Borrowers and
the offices where each keeps the Records are located at the address(es) listed on
Schedule B or such other locations of which Lender has been notified in accordance
with Section 7.2(a) and in jurisdictions where all action required by Section 12.4(a) have
been taken and completed. Such Borrower’s Federal Employer Identification Number is
correctly set forth on Schedule B.

     (j) Collections. The names and addresses of each Lock-Box Bank used to process
Collections, together with the account numbers of the related Lock-Box Accounts and the post
office box number of each related Lock-Box, are listed on Schedule C of this
Agreement (as updated from time to time after the Closing Date with the consent of Lender).
Each Lock-Box Account is the subject of a Lock-Box Control Agreement. No Borrower has
granted to any Person the right to process collections with respect to the Leases or
recoveries with respect to the Related Equipment, except as provided by or permitted under
the Transaction Documents.

     (k) Material Adverse Effect. All financial statements of such Borrower that have been
delivered to Lender have been prepared in accordance with GAAP (except, in the case of
unaudited financial statements, for the lack of footnotes and being subject to year-end
audit adjustments) and present fairly in all material respects such Borrower’s financial
condition as of the date thereof and results of operations for the period then ended. Since
September 30, 2007, no event has occurred that has had a Material Adverse Effect.

     (l) Names. In the past five (5) years, none of the Borrowers has used any corporate
names, trade names or assumed names other than the name(s) in which such Borrower has
executed this Agreement or as indicated on Schedule B.

     (m) Ownership of Borrower. FSS is the sole shareholder of such Borrower, and holds all
of the issued and outstanding Stock of such Borrower free and clear of all Liens and Adverse
Claims. There are no agreements to which any Company Party is a party to transfer or
provide any Lien on any of the Stock of such Borrower, or to issue Stock of such Borrower,
to any other Person at any time or upon the happening of any condition or event.

     (n) Not a Holding Company or an Investment Company. Such Borrower is not an
“investment company” within the meaning of the Investment Company Act of 1940, as amended,
or any successor statute.

     (o) Compliance with Law.

     (A) Such Borrower has complied with all applicable laws, rules, regulations,
orders, writs, judgments, injunctions, decrees or awards to which it

17

 

may be subject,
except where the failure to comply would not reasonably be expected, individually or
in the aggregate, to have a Material Adverse Effect.

     (B) No provision in or course of conduct with respect to a Lease or the Related
Equipment contravenes any laws, rules or regulations applicable thereto (including
laws, rules and regulations relating to truth in lending, fair credit billing, fair
credit reporting, equal credit opportunity, fair debt collection practices and
privacy).

     (p) Compliance with Credit and Collection Practices. Such Borrower has complied in all
material respects with its historic credit and collection practices with regard to each
Lease and Related Equipment.

     (q) Eligible Leases. As of the date of the Advance or Substitution therefor, each
Lease included in a schedule attached to a Request for Funding or a Request for
Substitution, as the case may be, and each Receivable related thereto satisfied the
requirements of eligibility set forth in the definition of “Eligible Lease.”

     (r) No Default Under Transaction Documents. No Default or Event of Default exists with
respect to such Borrower or will result from the incurring of any obligations under any
Transaction Document by such Borrower.

     (s) No Adverse Selection. Such Borrower has selected Leases for funding from among
those Leases that could qualify as Eligible Leases randomly by lease numbers. With respect
to any Lease that could qualify as an Eligible Lease but which has been or has not been
designated for funding or substitution hereunder, such Borrower has not knowingly made such
selection in any manner that adversely affects Lender or the likelihood of collectibility of
any material portion of the Leases taken as a whole.

     (t) Solvency. Both before and immediately after giving effect to any of the
transactions contemplated by this Agreement and the other Transaction Documents to which
such Borrower is a party: (i) the present fair salable value of the assets of such Borrower
is in excess of the amount that will be required to pay its probable liability on its
existing debts as said debts become absolute and matured, (ii) the Transaction Documents to
which a Borrower is a party provide such Borrower with reasonably equivalent value for the
obligations incurred by such Borrower under such Transaction Documents, (iii) the property
remaining in the hands of such Borrower is not an unreasonably small capital, and (iv) such
Borrower is able to pay its debts as they mature.

     (u) Brokerage Fees. Such Borrower has not utilized the services of any broker or
finder in connection with obtaining any financing from Lender under this Agreement and no
brokerage commission or finders fee is payable by such Borrower in connection herewith.

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Article V Limitations on Recourse; Repurchase and Substitution of Leases

     Section 5.1 Limitations on Recourse. The Borrowers’ Obligations in respect of payment of
accrued interest on and repayment of any Advance or any Loan made hereunder and, other than
Recourse Obligations, all other Obligations of each of the Borrowers, shall not be a recourse
obligation of any Borrower and shall be payable solely from Collections and the other Collateral.
Without limiting the foregoing, except for those representations made by a Borrower as to a Lease
being an Eligible Lease as of the date of any Advance (and the related Request for Funding) with
respect to such Lease or any Substitution (and the related Request for Substitution) with respect
to such Substituted Lease, none of the Borrowers guaranties, and Lender shall have no recourse
against any Borrower with respect to, (i) the credit quality of any Obligor (ii) any Obligor’s
financial ability to make timely payments of such Obligor’s obligations under any Lease or (iii)
the failure at any time of any Obligor to budget and appropriate sufficient moneys to make any
Scheduled Payment or other amounts due under such Lease, and, in the event of any shortfall in
Collections as a consequence thereof, Lender’s recourse shall be limited to the other Collateral of
such Borrower and the proceeds thereof. In addition, the Recourse Obligations are several
liabilities of the Borrowers. The separate Recourse Obligations of any one Borrower shall not
impose any guarantor or suretyship liability on any other Borrower with respect to such separate
Recourse Obligations. In the event that more than one Borrower shall have Recourse Obligations in
any instance, for example because such Recourse Obligations arise from the same nucleus of
operative facts or conditions, and it is difficult or burdensome to determine which Borrower has
liability for which portion thereof, the Borrowers hereby agree that Lender may employ any means of
allocation that is reasonable under the circumstances, which may include pro rata allocations based
on the Loans made to or then owing by such Borrowers. The several nature of liability for Recourse
Obligations shall not in any way limit or impair Lender’s rights with respect to any FSS Guaranty.

     Section 5.2 Substitutions.

     (a) General Requirements. Subject to the conditions set forth in Section 5.2(b) and
Section 6.2, a Borrower may request Lender to approve a Substitution, including, without
limitation, a Substitution for any Lease for which a Deemed Collection has occurred, Lender
may accept or reject any Substituted Lease in its absolute and sole discretion, and
generally any Substituted Lease must have an NPV as of the date of Substitution equal to or
greater than the NPV of the Lease to be removed. The Borrower requesting a Substitution is
deemed to have represented that each Substituted Lease is an Eligible Lease as of the date
of its Substitution. No Substitution shall be requested or made if: (i) such Substitution
is made with any intent to hinder, delay, or defraud any Person to which any of the
Borrowers is or will become indebted; (ii) there shall be any reason to believe that any of
the Borrowers is insolvent or that such substitution or removal will render any of the
Borrowers insolvent on the date thereof or as a result of such Substitution; (iii) at the
time of such Substitution none of the Borrowers is engaged in business, or about to engage
in business, for which the assets remaining with it after the Substitution will be an
unreasonably small amount of capital; or (iv) any of the Borrowers intends or believes that it will incur debts beyond its ability to pay as such
debts mature.

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     (b) Request for Approval of Leases and Terms. If a Borrower wishes to request a
Substitution, such Borrower, through one of its Authorized Persons, shall submit to Lender a
Request for Approval of Leases and Terms, which shall set forth information as required
under Section 1.1(d) with respect to requested Advances, for each Lease proposed for removal
and each Lease proposed for inclusion as Collateral with respect to that requested
Substitution. Upon receipt of a Request for Approval of Leases and Terms, Lender and the
applicable Borrower shall agree on such further information and due diligence review for the
proposed Leases identified therein, including such business, credit, legal and
administrative review as Lender may request. Lender may in its sole discretion accept or
decline all or any of the Leases proposed as Collateral for the Substitution or the other
terms proposed in the Request for Approval of Leases and Terms, for any reason and without
stating any reason. In the event that Lender approves all or any portion of any such
Request for Approval of Leases and Terms, Lender will provide the requesting Borrower with a
Lease and Terms Approval, which shall include the identification number and Obligor name for
each Lease approved for Substitution and for removal and their respective estimated NPV as
of the date of Substitution. Subject to there being no material adverse change with respect
to any Company Party or any Obligor with respect to any such Substituted Lease after the
date of such approval and prior to the Substitution (but without limiting Lender’s
discretion with respect to making or declining to make any Substitution), each Lease and
Terms Approval shall be valid for a period of thirty (30) days from its date of issuance by
Lender.

     (c) Request for Substitution. If during the effective period of any Lease and Terms
Approval a Borrower wishes to effect a Substitution with respect to any Lease identified on
such Lease and Terms Approval, such Borrower, through one of its Authorized Persons, shall
request Substitution by giving Lender irrevocable written notice, in the form of Exhibit
III-B attached hereto (each, a “Request for Substitution”), which shall include, among
other things:

     (i) the proposed date of the Substitution, which shall be a Business Day;

     (ii) a schedule of the Leases to be included as Collateral by such
Substitution, and each Lease related thereto to be removed as Collateral by such
Substitution;

     (iii) the estimated NPV of each related Lease calculated as of the date of such
Substitution.

So long as all of the conditions for a Substitution are satisfied as of the date of the
proposed Substitution, such Substitution shall be effective on the Cut-Off Date with respect
to that Substitution.

Article VI Conditions Precedent

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     Section 6.1 Conditions Precedent to Lender’s Execution. Lender shall not execute this
Agreement unless the following conditions have been satisfied in a manner satisfactory to Lender:

     (a) Lender shall have received on or before the Closing Date all of the documents
listed on Schedule A-1;

     (b) Lender shall have received all fees and been reimbursed for all expenses (including
Lender Expenses) payable by the Borrowers on or before the Closing Date pursuant to the
terms of this Agreement and the other Transaction Documents; and

     (c) all other due diligence required by Lender shall have been completed to its
satisfaction and all legal matters incident to the initial extension of credit hereunder,
including review of the documents required by this Section 6.1, shall be satisfactory to
counsel for Lender.

     Section 6.2 Conditions Precedent to All Requests for Funding of an Advance or Substitution. A
Borrower may not request an Advance or Substitution unless each of the following additional
conditions is met as of the date of such request and the date of such Advance or Substitution:

     (a) no Default or Event of Default with respect to the applicable Borrower or FSS shall
have occurred and be continuing;

     (b) Lender shall have received a Request for Approval of Leases and Terms executed by
the applicable Borrower(s) relating to such Advance or Substitution and the Borrowers shall
have received from Lender an Approval of Leases and Terms, and, in the case of an Advance,
Lender shall have received a Request for Funding executed by the applicable Borrower(s),
each in accordance with Section 1.1 or, in the case of a Substitution, Lender shall have
received with respect to such Substitution, a Request for Substitution executed by the
applicable Borrower(s) in accordance with Section 5.2(c);

     (c) Lender shall have received a certificate of a Responsible Officer of each of the
applicable Borrowers that each such Lease designated as an Eligible Lease meets as of such
date all of the requirements for eligibility set forth in the definition of “Eligible
Leases” hereunder;

     (d) Lender shall have received such evidence of the termination of any existing Liens
with respect to any of the Collateral of such Borrower (other than, with respect to any
Related Equipment, Permitted Liens), including UCC termination statements or releases, all
in form and substance satisfactory to Lender and its counsel; and

     (e) Lender shall have received such other approvals, opinions or documents as it may
reasonably request.

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     Section 6.3 Conditions Subsequent to Lender’s Execution. Within sixty (60) days after the
Closing Date Lender shall have received the items listed on Schedule A-2.

Article VII Covenants

     Section 7.1 Affirmative Covenants. Until the date on which the Obligations have been Paid in
Full and this Agreement terminates in accordance with its terms, each Borrower hereby covenants, on
its own behalf and with respect to itself except as otherwise expressly stated, as set forth below:

          (a) Financial and Other Reporting.

     (i) GAAP Accounting. The Borrowers will maintain a system of accounting
established and administered in accordance with GAAP, and shall deliver to Lender
financial information with respect to any of the Borrowers that Lender may
reasonably request.

     (ii) Monthly Servicing Report. The Borrowers will deliver or cause to be
delivered, by not later than the fourth (4th) Business Day of each
Accounting Month, with respect to the immediately preceding Accounting Month, a
Monthly Servicing Report. Notwithstanding the foregoing or anything to the
contrary in Section H(a) of the form of Monthly Servicing Report attached hereto as
Exhibit IX, the Lenders and Borrowers agree that (1) Borrowers will deliver
or cause to be delivered, by not later than 15th day of February, May, August and
November, respectively (or, if such date is not a Business Day, then the next
subsequent Business Day) the statement of projected cash flows for all Leases as of
the last day of the immediately preceding Accounting Month and (2) Lender will
calculate the items in Section H(a) of the Monthly Servicing Report and provide
Borrowers with the results of its calculations as of the last Business Day of
February, May, August, and November, respectively. Borrowers acknowledge and agree
that Lender may, at any time in its sole discretion, require Borrowers to provide
the statement of projected cash flows on a monthly basis with the Monthly Servicing
Report.

     (iii) Schedule of Leases. Upon Lender’s request (which shall be no more
frequently than once each calendar quarter unless an Event of Default exists) each
Borrower will deliver or cause to be delivered, an updated schedule (the “Schedule
of Leases”), which schedule shall include a list of all Leases in such Borrower’s
Lease Pool and such other information as Lender shall request from time to time.
Each Schedule of Leases shall be delivered to Lender via electronic mail formatted
in Excel or such other software application as Lender may reasonably request from
time to time.

     (iv) Change in Credit and Collection Practices. At least thirty (30) days
prior to the effectiveness of any material change in its historic credit and
collection practices, each Borrower will provide, or cause to be provided, to

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Lender written notice (A) indicating such change, and (B) if such proposed change would
reasonably be expected to adversely affect the collectibility of the Receivables or
decrease the credit quality of any newly created Receivables, obtaining Lender’s
prior written consent thereto.

     (v) Other Information. Each Borrower will provide, or cause to be provided, to
Lender promptly, from time to time, such other information, documents, records or
reports relating to the Receivables or any of the other Collateral or Servicing with
respect thereto as Lender may from time to time reasonably request.

     (b) Notices. The Borrowers will notify Lender in writing of any of the following
promptly upon knowledge of the occurrence thereof, describing the same and, if applicable,
the steps being taken with respect thereto:

     (i) Events of Default or Defaults. The occurrence of each Event of Default and
Default, in each instance accompanied by a statement with respect thereto of a
Responsible Officer of the applicable Company Party.

     (ii) Material Adverse Effect. The occurrence of any Material Adverse Effect.

     (iii) Servicer Defaults. The occurrence of any default by the initial Servicer
or Subservicer in the performance of their obligations under the Servicing
Agreement.

     (iv) Lock-Boxes. Other than notices to Obligors required pursuant to Section
2.3(a), any change or modification to any remittance instruction to any Obligor
under any Lease, such notice to be advance notice and consent.

     (c) Compliance with Laws and Preservation of Corporate Existence. Each of the
Borrowers will comply in all respects with all applicable laws, rules, regulations, orders,
writs, judgments, injunctions, decrees or awards imposed by all governmental authorities in
respect of the conduct of its business and the ownership of its properties, except where the
failure to so comply would not reasonably be expected to have a Material Adverse Effect.
Each of the Borrowers will preserve and maintain its corporate existence, rights, franchises
and privileges in the jurisdiction of its organization, and qualify and remain qualified in
good standing as a foreign organization in each jurisdiction where its business is
conducted, except where the failure to so qualify or remain qualified would not reasonably
be expected to have a Material Adverse Effect.

     (d) Audits. Each of the Borrowers will, from time to time during regular business
hours as requested by Lender upon reasonable notice, permit Lender, or its agents or representatives, (i) to examine and make copies of and abstracts from all Records
in the possession or under the control of any of the Borrowers or FSS relating to it or any
of the Collateral, and (ii) to visit the offices and properties of each of the

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Borrowers or FSS for the purpose of examining such materials described in clause (i) above, and to
discuss matters relating to the Collateral or any Company Party’s performance under any of
the Transaction Documents or any Person’s performance under the Leases, in each case, with
any of the officers or employees of the Company Party having knowledge of such matters;
provided, that prior to the occurrence of an Event of Default, such audit shall not be
conducted more than twice in any calendar year.

     (e) Keeping and Marking of Records and Books.

     (i) Each of the Borrowers shall cause the Servicer (if a Company Party) to
maintain and implement administrative and operating procedures (including an ability
to recreate records evidencing Receivables in the event of the destruction of the
originals thereof), and keep and maintain all documents, books, records and other
information reasonably necessary or advisable for the collection of all Receivables
(including records adequate to permit the immediate identification of each new
Receivable and all Collections of and adjustments to each existing Receivable).

     (ii) Each of the Borrowers will mark and will direct FSS to mark, within thirty
(30) days after the date of any Loan or Substitution hereunder, its master data
processing records and other books and records with a code or other identifying
information acceptable to Lender, sufficient to identify Lender’s interests under
this Agreement.

     (f) Compliance with Leases and Standard of Care. Each of the Borrowers will itself and
through the Servicer (if a Company Party) timely and fully (i) perform and comply with all
provisions, covenants and other promises required to be observed by it under the Leases, and
(ii) except as otherwise permitted under the Servicing Agreement, comply in all respects
with Standard of Care in regard to each Receivable subject to such Lease.

     (g) Delivery of Principal Lease Documents and Lease Files. Within thirty (30) days
after the date of an Advance or a Substitution, the applicable Borrower will deliver to
Lender (or its designated Custodian) each Principal Lease Document with respect to the
Leases with respect to which such Advance or Substitution is made, together with the
original, photocopy or electronic record of the remainder of the Lease File in existence on
such date.

     (h) Security Interests. Subject to the last sentence of this subsection, each Borrower
at its expense shall take all action necessary to establish and maintain, in favor of
Lender, a valid and perfected first priority security interest in all of its Collateral free
and clear of any Adverse Claims other than Permitted Liens and Liens in favor of Lender,
including the filing of all financing statements or other similar instruments or documents
necessary under the UCC (or any comparable law) of all appropriate jurisdictions to perfect
Lender’s interest in such Collateral and such other action to perfect, protect or more fully
evidence the interest of Lender as Lender may reasonably request. Each

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Borrower at its expense shall take all action reasonably requested by Lender to ensure that with respect to
each Lease in which it has any interest such Borrower obtains and maintains a perfected
security interest, free and clear of any Adverse Claims (except Liens in favor of Lender and
Permitted Liens), in all Related Equipment; provided, however, no Borrower shall have any
obligation to retitle any of Certificates of Title related to any Related Equipment to
reflect the interest of such Borrower or Lender therein unless requested to do so pursuant
to Section 3.4 hereof.

     (i) Taxes. Each of the Borrowers shall file all tax returns and reports required by
law to be filed by it. Each of the Borrowers shall promptly pay all taxes and governmental
charges at any time owing by it and pay all taxes payable in connection with the Collateral,
exclusive of taxes on or measured by income or gross receipts of Lender; provided, however,
each of the Borrowers may in good faith and by appropriate proceedings challenge the
validity or amount of any taxes, if such proceedings stay the execution of any such taxes
and no Lien attaches to any of the Collateral as a consequence thereof; and, provided
further, that each of the Borrowers shall set aside in its books in accordance with GAAP
adequate reserves with respect thereto.

     (j) Collections. All Collections shall be directed to and deposited in the Lock-Box
Account in accordance with Sections 2.2 and 2.3 hereof. Schedule C shall at all
times contain current information regarding all lock-box arrangements applicable to the
Collateral.

     (k) Insurance. Each of the Borrowers will maintain in effect, or cause to be
maintained in effect, at its own expense, (i) casualty and liability insurance and (ii)
business interruption, public liability, and product liability insurance, as well as
insurance against larceny, embezzlement, and criminal misappropriation. All such insurance
policies shall be in such amounts and with such insurance companies as are in each of the
Borrowers’ best business judgment and in any event in amounts and with deductibles not less
than that carried on the date of this Agreement and disclosed to Lender. At the request of
Lender, each of the Borrowers shall deliver copies of all such policies to Lender with a
satisfactory loss payable endorsement naming Lender as loss payee or additional insured, as
appropriate, as its interests may appear. Each of the Borrowers will pay or cause to be
paid, the premiums therefor. Evidence satisfactory to Lender of such insurance coverage
(including payment of premiums) and copies of each policy shall be furnished to Lender in
certificated form upon Lender’s request.

     (l) Payment of Lender Expenses. Each Borrower shall pay to Lender within ten (10)
Business Days after demand any amounts necessary to pay or reimburse Lender Expenses payable
by such Borrower, including any pro rata share thereof allocated to it pursuant to Section
5.1.

     Section 7.2 Negative Covenants. Until the date on which the Obligations have been Paid in
Full and this Agreement terminates in accordance with its terms, each Borrower hereby covenants, as
to itself, that:

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     (a) Name Change, Offices and Records. No Borrower will change its identity or
corporate or other organizational structure or its name, (within the meaning of Section
9-507(c) of the UCC) or relocate its chief executive offices or any office where Records are
kept or change its locations (within the meaning of Section 9-307 of the UCC) unless it
shall have: (i) given Lender at least forty-five (45) days’ prior written notice thereof and
(ii) delivered to Lender all financing statements, instruments and other documents
reasonably requested by Lender in connection with such change or relocation.

     (b) Change in Payment Instructions to Obligors. No Borrower will add or terminate any
bank as a Lock-Box Bank or make any change in the instructions to Obligors regarding
payments to be made to any Lock-Box (or Lock-Box Account in the case of ACH Receipts) nor
will it permit any other Person to do any of the foregoing without the prior written consent
of Lender.

     (c) Modifications to Leases and Credit and Collection Policies. Such Borrower will
not, and will not permit FSS to, (i) without Lender’s prior written consent, make any change
to its historic credit and collection practices that would reasonably be expected to
adversely affect the collectibility of the Receivables or decrease the credit quality of any
newly created Receivables and (ii) extend, amend or otherwise modify the terms of any
Receivable or any Lease, except as provided in the Servicing Agreement.

     (d) Sales, Liens. Such Borrower shall not sell, assign (by operation of law or
otherwise) or otherwise dispose of, or grant any option with respect to, or create or suffer
to exist any Adverse Claim upon (including the filing of any financing statement) or with
respect to, any of its Collateral, including any Lease, Related Equipment or other Related
Security or Collections with respect thereto, or any Lock-Box, or the Lock-Box Account, or
assign any right to receive income with respect thereto (other than the grant of Liens in
favor of Lender provided for herein); provided, however, that solely with respect to Related
Equipment, such Borrower may create and suffer to exist Permitted Liens. Each Borrower
shall defend the right, title and interest of Lender in, to and under any of the foregoing
property, against all Adverse Claims (other than Permitted Liens) of third parties claiming
through or under the Company Parties.

     (e) Selection Procedures. Such Borrower shall not use selection procedures to identify
any Lease that otherwise qualifies as an Eligible Lease to be included or removed from the
Lien in favor of Lender under the Transaction Documents in any manner that would reasonably
be expected adversely and materially to affect Lender’s interests in or the value of the
Collateral or the likelihood of collectibility of any material portion of the Leases taken
as a whole.

Article VIII Administration And Collection

     Section 8.1 Designation of Servicer.

     (a) The servicing, administration and collection of the Leases and other Collateral
shall be initially conducted by FSS, acting as Servicer, in accordance with the

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terms of the Servicing Agreement and the other Transaction Documents. Each of the Borrowers, with
respect to Leases in which it has an interest, hereby agrees to perform the duties and
obligations of the Subservicer pursuant to the Servicing Agreement.

     (b) Upon the occurrence of an Event of Default hereunder (whether or not the Loans are
declared immediately due and payable as a result thereof) or a Termination Event, Lender is
hereby authorized to designate a Third-Party Servicer to act as Servicer or Subservicer or
to perform some or all of their duties in such capacities, and upon designation of such a
successor, the Borrowers acknowledge and agree that neither they nor FSS shall have the
right to perform the designated activities with respect to the designated Collateral. The
Borrowers further agree that upon such termination of FSS as Servicer or the Borrowers as
Subservicers (i) the interest rate with respect to the related Loan(s) shall increase by
five (5) basis points in order to offset the ongoing costs of servicing of the Leases, (ii)
each Company Party shall assist, at its cost, with the transition of servicing to such
Third-Party Servicer as provided in the Servicing Agreement, and (iii) the Borrowers shall
pay or reimburse to Lender upon demand all Servicer Transition Costs. All Third-Party
Servicer Costs and Fees shall be paid or reimbursed to Lender as provided in Section 2.4(a).

     (c) If at any time after FSS or the Borrowers have been terminated as Servicer or
Subservicers, respectively, any of them shall receive directly any Collections or are
deemed to receive any Deemed Collections, the Borrowers shall cause such Company Party
immediately to notify the Third-Party Servicer and shall remit such Collections or Deemed
Collections to the Lock-Box Account or as otherwise directed by the Third-Party Servicer for
application in accordance with the terms and conditions of this Agreement and, at all times
prior to such payment, such Collections or Deemed Collections shall be held in trust by the
Borrowers or FSS, as the case may be, for the exclusive benefit of Lender.

Article IX Events Of Default

     Section 9.1 Events of Default. The occurrence of any one or more of the following events
shall constitute an Event of Default:

     (a) The applicable Borrower or FSS shall:

     (i) fail to make any payment or deposit required hereunder or under any other
Transaction Document when due, or

     (ii) fail to perform or observe any term, covenant or other agreement hereunder
or under any other Transaction Document (other than as referred to in clause (i) of
this paragraph (a)) and such failure shall continue without cure, if susceptible to
cure, for thirty (30) days after the earlier to occur of (A) notice thereof given by
Lender to the Designated Representative, or (B) the applicable Borrower or FSS
having knowledge thereof.

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     (b) Any representation or warranty made by or on behalf of the applicable Borrower or
FSS in this Agreement or any other Transaction Document, shall prove to have been incorrect
when made or deemed made; or any written certification or written statement (other than a
representation or warranty) made by or on behalf of such Company Party in this Agreement,
any other Transaction Document or in any other certificate delivered pursuant hereto or
thereto shall prove to have been materially incorrect when made or deemed made; provided,
however, that a breach of the representation in Section 4.1(q) hereof shall not constitute
an Event of Default under this Section 9.1(b) until thirty (30) days after the earlier to
occur of (a) notice thereof given by Lender to the Designated Representative or (b) the
applicable Borrower having knowledge thereof, and then only if the applicable Borrower fails
prior to the lapse of such cure period, to (1) substitute in accordance with Section 5.2
hereof a Substituted Lease for the Lease for which such representation was made, (2) pay
over the Deemed Collections with respect to such Lease, or (3) so long as Lender, its
interests in any Collateral or the collectibility of any Receivables have not been and would
not be adversely affected, cure (if susceptible to cure) to the satisfaction of Lender any
condition or circumstance that caused the related Lease not be an Eligible Lease.

     (c) Any of the Transaction Documents shall cease for any reason to be in full force and
effect, or any Company Party thereto shall purport to disavow any of its obligations
thereunder, shall declare that it does not have any further obligation thereunder, or shall
contest the validity or enforceability thereof.

     (d) (i) The applicable Borrower or FSS shall generally not pay its debts as such debts
become due or shall admit in writing its inability to pay its debts generally or shall make
a general assignment for the benefit of creditors; or (ii) any Insolvency Proceeding shall
be instituted by or against the applicable Borrower or FSS and, in the case of an Insolvency
Proceeding instituted against such Company Party (but not by that Person) either such
Company Party fails, within thirty (30) days of the commencement of such Insolvency
Proceeding to move to have such Insolvency Proceeding dismissed or such Insolvency
Proceeding shall remain undismissed or unstayed for a period of sixty (60) days, or (iii)
such Company Party shall take any corporate action to authorize any of the actions set forth
in clauses (i) or (ii) above in this subsection (d).

     (e) A Change of Ownership shall occur with respect to the applicable Borrower.

     (f) (i) Any Company Party shall directly or indirectly contest in any manner the
effectiveness, validity, binding nature or enforceability of or first priority Lien of Lender with respect to any of the Collateral, or (ii) Lender shall cease to have a valid and
perfected, first priority Lien on, the Collateral (other than the Related Equipment), or
(iii) Lender’s Lien on any portion of the Collateral (other than with respect to the Related
Equipment) shall become impaired or otherwise unenforceable, or any event or circumstance
shall occur or exist that could reasonably result in any material impairment in the Lien of
Lender on the Collateral (other than the Related Equipment) or the perfection or priority
thereof, or (iv) Lender’s Lien on any material portion of the

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Related Equipment shall become impaired or otherwise unenforceable, or any event or circumstance shall occur or
exist that could reasonably result in any material impairment in the Lien of Lender on any
material portion of the Related Equipment or the perfection or priority thereof.

     (g) The NPV of the Leases not classified as Defaulted Leases, computed using the
applicable Discount Rate, in any Lease Pool of the applicable Borrower is less than one
hundred and two percent (102%) of the outstanding related Loan(s).

     Section 9.2 Remedies. Upon the occurrence of an Event of Default, Lender may take any or all
of the following actions: (i) appoint a Third-Party Servicer for all or any one or more of the
Borrowers in accordance with this Agreement and the Servicing Agreement, (ii) cease accepting
requests from the Borrowers to make Loans or accept Substitutions hereunder, and declare all Loans
and other Obligations of the applicable defaulting Borrower to Lender under the Transaction
Documents to be immediately due and payable, without demand, protest or further notice of any kind,
all of which are hereby expressly waived; provided, however, that upon the occurrence of an Event
of Default described in Section 9.1(d), or of an actual or deemed entry of an order for relief with
respect to any Company Party under the Bankruptcy Code, immediately and without notice, all
indebtedness and other Obligations of the defaulting Borrower or, if such event occurs with respect
to FSS, all of the Borrowers to Lender under the Transaction Documents shall automatically become
immediately due and payable, without demand, protest or any notice of any kind, all of which are
hereby expressly waived, (iii) notify Obligors of the defaulting Borrower or, if such event occurs
with respect to FSS, all Obligors, of Lender’s interest in the Receivables and cause the lien
notations on the Certificates of Title to be updated to reflect Lender’s security interest, and
(iv) foreclose upon its security interests in and cause a sale or other disposition of all or any
portion of, the defaulting Borrower’s Collateral or, if such event occurs with respect to FSS, all
of the Collateral. The aforementioned rights and remedies shall be without limitation, and shall
be in addition to all other rights, powers and remedies of Lender otherwise granted or available to
it under any Transaction Document or permitted by law, either by suit in equity or by action at
law, or both, including, without limitation, all rights and remedies provided under the UCC, all of
which rights shall be cumulative; provided, however, that Lender’s recourse to assets of any of the
Borrowers other than the Collateral shall be limited to the extent provided in Article V.

Article X Indemnification

     Section 10.1 Indemnities. Without limiting any other rights that Lender may have hereunder or
under applicable law, each of the Borrowers hereby agrees to indemnify Lender and its assigns,
officers, directors, agents and employees (each an “Indemnified Party”) from and against any and all damages, losses, claims, taxes, liabilities, costs, expenses and for all other
amounts payable by any such Indemnified Party, including reasonable attorneys’ fees and
disbursements (all of the foregoing being collectively referred to as “Indemnified Amounts”)
awarded against or incurred by any of the Indemnified Parties arising out of or as a result of this
Agreement or any other Transaction Document, any Loan made hereunder, including the use of any
proceeds of any Loan, or any interest of Lender in, or the exercise or nonexercise of any rights
with respect to, any of the Collateral; excluding, however, in all of the foregoing instances

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the Excluded Amounts. Without limiting the generality of the foregoing indemnification, each Borrower
shall indemnify Lender for Indemnified Amounts (including losses in respect of uncollectible
receivables, regardless of whether reimbursement therefor would constitute recourse to any
Borrower), but excluding the Excluded Amounts, to the extent arising out of or resulting from:

     (a) any written representation or warranty made by or on behalf of that Borrower (or
any officers of any such Borrower), but not by any other Company Party, under or in
connection with this Agreement, any other Transaction Document or any other written
information or report delivered by any such Person pursuant hereto or thereto, which shall
have been false or incorrect when made or deemed made;

     (b) the failure by that Borrower, but not by any other Company Party, to comply with
any applicable law, rule or regulation with respect to any Lease or other Collateral, or the
nonconformity of any Lease or other Collateral with any such applicable law, rule or
regulation, or any failure of the applicable Borrower to keep or perform any of its
obligations, express or implied, with respect to any Lease in such Borrower’s Lease Pool;

     (c) any failure of that Borrower, but not of any other Company Party, to perform its
duties, covenants or other obligations in accordance with the provisions of this Agreement
or any other Transaction Document;

     (d) any products liability, personal injury or damage suit, or other similar claim
arising out of or in connection with any goods, merchandise, insurance or services that are
the subject of any Lease in that Borrower’s Lease Pool;

     (e) with respect to such Borrower’s Lease Pool, any dispute, claim, offset or defense
(other than discharge in bankruptcy of the Obligor or failure to appropriate and budget by
the Obligor) of the Obligor to the payment of any Receivable (including a defense based on
such Receivable or Lease not being a legal, valid and binding obligation of such Obligor
enforceable against it in accordance with its terms), or any other claim resulting from the
sale of the goods or merchandise or service related to such Receivable or the furnishing or
failure to furnish such goods or merchandise or services;

     (f) the commingling of Collections by a Company Party at any time with other funds;

     (g) any investigation, litigation or proceeding related to or arising from this
Agreement or any other Transaction Document, the transactions contemplated hereby, the use
of the proceeds of any Loan, the Lien of Lender on any of the Collateral or any other
investigation, litigation or proceeding relating to such Borrower in which any Indemnified
Party becomes involved as a result of any of the transactions contemplated hereby;

30

 

     (h) any Event of Default described in Section 9.1(d) with respect to such Borrower or
FSS, including any adversary proceeding or contested matter arising in any such Insolvency
Proceeding, whether or not any Indemnified Person is a party thereto;

     (i) any failure of the applicable Borrower to acquire and maintain legal and equitable
title to, and ownership of, or a perfected, first priority security interest in any Related
Equipment, free and clear of any Adverse Claim (except as created pursuant to any
Transaction Document and any Permitted Lien) or any attempt by any Person to void such
security interest under statutory provisions or common law or equitable action; and any
Indemnified Amounts under this clause (i) with respect to any item of Related Equipment
shall be determined if, as a consequence of the foregoing, Lender (or the Subservicer on
Lender’s behalf) is prevented or is or would be delayed for a period of six months or longer
from exercising remedies available to a secured creditor with respect to such Related
Equipment;

     (j) any failure to vest and maintain vested in Lender, a perfected, first priority Lien
on the Leases (including the Collections thereon) in that Borrower’s Lease Pool free and
clear of any Adverse Claim (except as created by the Transaction Documents);

     (k) the failure of any Obligor under a Lease in that Borrower’s Lease Pool to obtain
and maintain property and liability insurance with respect to the Related Equipment under
such Obligor’s Lease;

     (l) any attempt by any Person to void the Lien of Lender on any of the Collateral or
void any payment made by or on account of the applicable Borrower with respect to any
indebtedness arising under any of the Transaction Documents under statutory provisions or
common law or equitable action; and

     (m) with respect to a Lease in that Borrower’s Lease Pool, the existence of any
Permitted Lien on the Related Equipment of the type described in clause (c) of the
definition of Permitted Liens; and

     (n) any notice or instruction given by or to the Designated Representative on behalf of
such Borrower.

Lender or other Indemnified Party shall provide prompt written notice to the Designated
Representative of any event or circumstance giving rise to an Indemnified Amount, but any delay or
failure to do so shall not limit any Borrower’s obligations under this Section 10.1.

     Section 10.2 Excluded Amounts. Notwithstanding anything in Section 10.1 to the contrary, no
Borrower shall have any obligation to indemnify an Indemnified Party with respect to any of the
following (collectively, the “Excluded Amounts”):

     (a) Indemnified Amounts to the extent a final judgment of a court of competent
jurisdiction holds that such Indemnified Amounts resulted from gross

31

 

negligence or willful misconduct on the part of the Indemnified Party seeking indemnification;

     (b) Indemnified Amounts to the extent the same includes losses in respect of
Receivables that are uncollectible on account of the insolvency, bankruptcy or lack of
creditworthiness of the related Obligor or the failure at any time of the related Obligor to
budget and appropriate sufficient moneys to make any Scheduled Payment or other amounts due
under such Obligor’s Lease, other than Indemnified Amounts owing (i) under Section 10.1(a)
arising as a result of representations and warranties regarding Eligible Leases made on the
date of any Advance or Substitution with respect to such Lease or (ii) under Section
10.1(i); or

     (c) taxes imposed by any jurisdiction in which such Indemnified Party is subject to
taxation, on or measured by the overall net income of such Indemnified Party;

provided, however, that nothing contained in this sentence shall limit the liability of any of the
Borrowers or limit the recourse of Lender to any of the Borrowers for amounts otherwise
specifically provided to be Recourse Obligations to be paid by a Borrower under the terms of this
Agreement.

Article XI Assignments; Participations

     Section 11.1 Assignments. Without the prior written consent of FSS, which shall not be
unreasonably withheld or delayed, Lender shall not assign all or any portion of its rights under,
interest in, title to and obligations under this Agreement and any other Transaction Document to
any other Person; provided, however, that no such consent of FSS shall be required in connection
with the sale of a material portion of the assets of Lender to or the merger of Lender with another
Person, or if an Event of Default shall have occurred and be continuing. So long as Lender remains
the primary contact for all lenders hereunder, the Borrowers hereby agree to cause FSS to not
unreasonably withhold or delay its consent to the complete or partial assignment by Lender of all
or any portion of its rights under, interest in, title to and obligations under this Agreement and
any other Transaction Document to any other Person. Upon such assignment, Lender shall be released
from its obligations (other than its obligations under this Section 11.1) so assigned if the
assignment documents so provide. Further, the Borrowers hereby agree that any such complete or
partial assignee of Lender shall have all of the rights and benefits under this Agreement and such
other Transaction Documents as if the term the “Lender” explicitly referred to such party, and no
such assignment shall in any way impair the rights and benefits of Lender hereunder not so
assigned. No Company Party shall have the right to assign its rights or obligations under this
Agreement or any other Transaction Document.

     Section 11.2 Participations. Lender may at any time sell to one or more Persons (each a
“Participant”) participating interests in any of the Loans or any other interest of Lender
hereunder. Notwithstanding any such sale, the rights and obligations of Lender under this
Agreement shall remain unchanged, Lender shall remain solely responsible for the performance of its
obligations hereunder, and the Borrowers shall continue to deal solely and directly with Lender in
connection with their rights and obligations under this Agreement.

32

 

     Section 11.3 Disclosures. In connection with any assignment, participation or pledge or
proposed assignment, participation or pledge pursuant to this Article XI, Lender may, subject to
Section 12.5, disclose all documents and information which it now or hereafter may have relating to
the Company Parties and their respective businesses.

     Section 11.4 Pledges. Any other provision in this Agreement notwithstanding, Lender may at
any time create a security interest in, or pledge, all or any portion of its rights under and
interest in this Agreement and any other Transaction Document in favor of any Person, including the
Federal Reserve Bank in accordance with Regulation A of the Federal Reserve Bank or U.S. Treasury
Regulation 31 CFR §203.14, and such Person or Federal Reserve Bank may enforce such pledge or
security interest in any manner permitted under applicable law.

Article XII
Miscellaneous

     Section 12.1 Waivers and Amendments.

     (a) No failure or delay on the part of Lender in exercising any power, right or remedy
under this Agreement or any other Transaction Document shall operate as a waiver thereof,
nor shall any single or partial exercise of any such power, right or remedy preclude any
other further exercise thereof or the exercise of any other power, right or remedy. Except
as otherwise provided herein, the rights and remedies herein provided shall be cumulative
and nonexclusive of any rights or remedies provided by law. Any waiver of this Agreement or
any other Transaction Document shall be effective only in the specific instance and for the
specific purpose for which given.

     (b) No provision of this Agreement may be amended, supplemented, modified or waived
except in writing executed and delivered by each of the Borrowers and Lender.

     Section 12.2 Notices. Except as provided below, all communications and notices provided for
hereunder shall be in writing (including bank wire, telecopy or electronic facsimile transmission
or similar writing) and shall be given to the other parties hereto at their respective addresses or
fax numbers set forth on the signature pages hereof or at such other address or fax number as such
Person may hereafter specify for the purpose of notice to each of the other parties hereto. Each
such notice or other communication shall be effective (i) if given by telecopy or electronic
facsimile transmission, upon receipt of electronic confirmation of receipt thereof, (ii) if given
by mail, three (3) Business Days after the time such communication is deposited in the mail
registered with return receipt requested, or (iii) if given by any other means, when received at
the address specified in this Section. Any notice or other communication given by Lender hereunder
to the Designated Representative in accordance with the terms hereof shall be deemed to be given simultaneously to all Company Parties, and each of the Borrowers agrees that
it shall be the Designated Representative’s (or such Borrower’s) responsibility to provide such
notices or other communications to each of the Company Parties.

     Section 12.3 Revival of Voidable Transfers. If the incurrence or payment of the Obligations
by any Borrower or the transfer to Lender of any property or interest therein should for any reason
subsequently be declared to be void or voidable under any state or federal law

33

 

relating to creditors’ rights, including provisions of the Bankruptcy Code relating to fraudulent conveyances,
preferences, or other voidable or recoverable payments of money or transfers of property
(collectively, a “Voidable Transfer”), and if Lender is required to repay or restore, in whole or
in part, any such Voidable Transfer, or elects to do so upon the reasonable advice of its counsel,
then, as to any such Voidable Transfer, or the amount thereof that Lender is required or elects to
repay or restore, and as to all Lender Expenses related thereto, the liability of such Borrower
automatically shall be revived, reinstated, and restored and shall exist as though such Voidable
Transfer had never been made.

     Section 12.4 Protection of Interests of Lender.

     (a) Each Borrower agrees that from time to time, at its expense, it will promptly
execute and deliver all instruments and documents, and take all actions, that may be
necessary, or that Lender may reasonably request, to perfect, protect or more fully evidence
the rights and interest of Lender under this Agreement and the other Transaction Documents,
or to enable Lender to exercise and enforce its rights and remedies hereunder and
thereunder. Except with the consent of Lender in any instance, the Company Parties,
Servicer or Subservicer (as applicable) shall withhold the identity of Lender in any
notification to Obligors.

     (b) If a Borrower fails to perform any of its obligations hereunder, Lender shall use
its reasonable efforts to notify the Designated Representative of such failure. Lender may
(but shall not be required to) perform, or cause performance of, such obligation, and Lender
Expenses related thereto shall be payable by such Borrower as provided in Section 2.1. The
Borrowers irrevocably authorize Lender at any time and from time to time in the sole
discretion of Lender, and appoints Lender as their attorney-in-fact, to act on behalf of a
Borrower to file financing statements and take such other actions necessary or reasonably
desirable by Lender to perfect and to maintain the perfection and priority of the interest
of Lender in the Receivables and other Collateral; provided, however, that Lender shall not
act as any Borrower’s attorney-in fact with respect to retitling of any Related Equipment
except to the extent entitled to do so under Section 3.4.

     Section 12.5 Confidentiality. Each of the Company Parties agrees that Lender may disclose any
information received by it in connection with this Agreement and the other Transaction Documents
other than any confidential information (as defined below), and no Company Party shall disclose to
any Person any information with respect to the Advance Rate, the Maximum Available Amount, the
Applicable Margin or the Interest Rate applicable to any Loan except, with respect to any of the
foregoing, disclosure: (a) to legal counsel and accountants for any Company Party or Lender; (b) to other professional advisors to any Company
Party or Lender; (c) to any Company Party or Lender or any affiliate thereof; (d) if requested or
required, to regulatory officials having jurisdiction over any Company Party or Lender; (e) to
another financial or other institution in connection with a disposition or proposed disposition to
that institution of all or part of Lender’s interests hereunder or a participation interest in any
of the Loans that agrees to maintain such information in confidence; (f) as required by law or
legal process or in connection with any legal proceeding to which Lender or

34

 

any Company Party is a party; and (g) with respect to a Company Party, disclosures to Persons to the extent required in
connection with consents of such Persons to the execution and delivery by a Company Party of any
Transaction Document; provided, however, that, if any Event of Default shall occur and the
Obligations of any Borrower hereunder have become immediately due and payable, Lender may disclose
any information regarding a Company Party or any of their respective properties to any prospective
purchaser of the Collateral or any other Person (including any prospective Third-Party Servicer)
that agrees to maintain such information in confidence, and may disclose any information solely
regarding the Collateral, in either case, as Lender reasonably deems necessary or desirable to
enforce its rights and remedies under this Agreement and the other Transaction Documents. For
purposes of the foregoing, “confidential information” means any information respecting either
Company Party and their Affiliates or any of their respective assets or properties, designated by a
Company Party or otherwise adequately identified in writing to the recipient thereof when received
by it as confidential, other than: (i) information previously filed with any Governmental Authority
and available to the public; (ii) information previously published in any public medium from a
source other than, directly or indirectly, Lender; and (iii) information that is or becomes
available on a nonconfidential basis from a source other than a Company Party, provided that such
source is not bound by a confidentiality agreement known to Lender with or in favor of a Company
Party. In addition, a Company Party may disclose to any Person information with respect to the
Advance Rate, the Maximum Available Amount, the Applicable Margin or the Interest Rate applicable
to any Loan if and to the extent that such information has become available to the public after
disclosure of such information by a Company Party made in accordance with this Section 12.5.
Nothing in this Section 12.5 shall be construed to create or give rise to any fiduciary duty on the
part of Lender to any Company Party or any other Person or liability of Lender to either Company
Party for any wrongful disclosure by any Person other than Lender. Notwithstanding anything herein
to the contrary, confidential information shall not include, and Lender (and each employee,
representative or other agent of Lender) may disclose to any and all Persons, without limitation of
any kind, the “tax treatment” and “tax structure” (in each case, within the meaning of Treasury
Regulation Section 1.6011-4) of the transactions contemplated hereby and all materials of any kind
(including opinions or other tax analyses) that are or have been provided to Lender relating to
such tax treatment or tax structure; provided that with respect to any document or similar item
that in either case contains information concerning such tax treatment or tax structure of the
transactions contemplated hereby as well as other information, this sentence shall only apply to
such portions of the document or similar item that relate to such tax treatment or tax structure.

     Section 12.6 Set-off.

     (a) In addition to any rights and remedies of Lender provided by law, but subject to
Section 12.6(b) Lender shall have the right, without prior notice to any Company Party, any such notice being expressly waived by each Company Party to the extent
permitted by applicable law, upon the occurrence and during the continuance of an Event of
Default, to set-off and apply against any Obligations, whether matured or unmatured, of any
of the Borrowers to Lender, any amount owing from Lender to any Company Party, at or at any
time after, the happening of any of the above mentioned events.

35

 

     (b) Nothing in this Section 12.6 shall authorize or permit Lender to, and Lender shall
not, set-off against any assets of any Borrower, other than Collections with respect to such
Borrower’s Lease Pool and the proceeds thereof, with respect to any Obligations that are not
Recourse Obligations of such Company Party or with respect to any Collateral or proceeds
thereof of any Borrower on account of any Recourse Obligations owing by any other Borrower.

     (c) This right of set-off may be exercised by Lender against any Borrower or against
any trustee in bankruptcy, debtor in possession, assignee for the benefit of creditors,
receiver or execution, judgment or attachment creditor of any Borrower or against anyone
else claiming through or against any Borrower or such trustee in bankruptcy, debtor in
possession, assignee for the benefit of creditors, receiver, or execution, judgment or
attachment creditor, notwithstanding the fact that such right of set-off shall not have been
exercised by Lender prior to the occurrence of an Event of Default. Lender agrees promptly
to notify the Designated Representative after any such set-off and application made by
Lender, provided that the failure to give such notice shall not affect the validity of such
set-off and application.

     Section 12.7 Limitation of Liability; Knowledge of Lender. Except with respect to any claim
arising out of or resulting from the willful misconduct or gross negligence of Lender, no claim may
be made by any Company Party against Lender or its Affiliates, directors, officers, employees,
attorneys or agents for any special, indirect, consequential or punitive damages in respect of any
claim for breach of contract or any other theory of liability arising out of or related to the
transactions contemplated by this Agreement, or any act, omission or event occurring in connection
therewith; and each Company Party hereby waives, releases, and agrees not to sue upon any claim for
any such damages, whether or not accrued and whether or not known or suspected to exist in its
favor. The Borrowers further agree that knowledge of any facts by any Person employed by, or any
agent of, Lender, that if true, would constitute a breach of representation of a Company Party or
breach of a covenant or other agreement made by a Company Party under any Transaction Document,
shall not be construed as a deemed waiver of compliance by such Company Party with any such
provision.

     Section 12.8 Choice of Law. The validity of this Agreement and the other Transaction
Documents (unless expressly provided to the contrary in another Transaction Document in respect of
such other Transaction document), the construction, interpretation, and enforcement hereof and
thereof, and the rights of the parties hereto and thereto with respect to all matters arising
hereunder or thereunder or related hereto or thereto shall be determined under, governed by, and
construed in accordance with the laws of the State of Illinois.

     Section 12.9 Consent to Jurisdiction. The parties agree that all actions or
proceedings arising in connection with this Agreement and the other Transaction Documents shall be
tried and litigated only in the state and federal courts located in the State of Illinois;
provided, however, that any suit seeking enforcement against any Collateral or other property may
be brought, at Lender’s option, in the courts of any jurisdiction where Lender elects to bring such
action or where such

36

 

Collateral or other property may be found. The Borrowers and Lender each
waive, to the extent permitted under applicable law, any right each may have to assert the doctrine
of forum non conveniens or to object to venue to the extent any proceeding is brought in accordance
with this section. Each party also waives personal service of any and all process and agrees that
all such service of process may be made upon such party by certified or registered mail, return
receipt requested, addressed to such party at the address referred to in Section 12.2 and service
so made shall be complete ten (10) days after the same has been posted.

     Section 12.10 Waiver Of Jury Trial. The Borrowers and Lender hereby waive their
respective rights to a jury trial of any claim or cause of action based upon or arising out of any
of the Transaction Documents or any of the transactions contemplated therein, including contract
claims, tort claims, breach of duty claims, and all other common law or statutory claims. Each of
the Borrowers and Lender represent that each has reviewed this waiver and each knowingly and
voluntarily waives its jury trial rights following consultation with legal counsel. In the event
of litigation, a copy of this Agreement may be filed as a written consent to a trial by the
court.

     Section 12.11 Integration; Binding Effect; Survival of Terms.

     (a) This Agreement, together with each of the other Transaction Documents, contains the
final and complete integration of all prior expressions by the parties hereto and thereto
with respect to the subject matter hereof and thereof and shall constitute the entire
agreement among the parties hereto with respect to the subject matter hereof and thereof
superseding all prior oral or written understandings.

     (b) This Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns (including any trustee in bankruptcy).
This Agreement shall create and constitute the continuing obligations of the parties hereto
in accordance with its terms and shall remain in full force and effect until terminated in
accordance with its terms; provided, however, that (i) the indemnification and payment
provisions of Sections 1.6 and 2.5 and Article X, (ii) the governing law and conflict
resolution provisions of Sections 12.8, 12.9, and 12.10, to the extent applicable, and (iii)
Sections 12.5 and 12.6, shall be continuing and shall survive any termination of this
Agreement.

     Section 12.12 Interpretive Provisions.

     (a) Accounting Terms. All accounting terms not specifically defined herein shall be
construed in accordance with GAAP. When used herein, the term “financial statements” shall
include the notes and schedules thereto.

     (b) UCC. Any terms used in this Agreement that are defined in the Illinois UCC shall
be construed and defined as set forth in the Illinois UCC unless otherwise defined herein.

37

 

     (c) Construction. Unless the context of this Agreement or any other Transaction
Document clearly requires otherwise, references to the plural include the singular,
references to the singular include the plural, the term “including” is not limiting, and the
term “or” has, except where otherwise indicated, the inclusive meaning represented by the
phrase “and/or.” The words “hereof,” “herein,” “hereby,” “hereunder,” and similar terms in
this Agreement or any other Transaction Document refer to this Agreement or such other
Transaction Document, as the case may be, as a whole and not to any particular provision of
this Agreement or such other Transaction Document, as the case may be. Section, subsection,
clause, schedule, and exhibit references herein are to this Agreement unless otherwise
specified. The captions and headings of this Agreement are for convenience of reference
only and shall not affect the construction of this Agreement. Any reference in this
Agreement or in the other Transaction Documents to any agreement, instrument, or document
shall include all alterations, amendments, changes, extensions, modifications, renewals,
replacements, substitutions, joinders, and supplements, thereto and thereof, as applicable
(subject to any restrictions on such alterations, amendments, changes, extensions,
modifications, renewals, replacements, substitutions, joinders, and supplements set forth
herein). Any reference herein to any Person shall be construed to include such Person’s
successors and assigns. Any requirement of a writing contained herein or in the other
Transaction Documents shall be satisfied by the transmission of a record (as defined in the
UCC) and any record transmitted by or on behalf of a Company Party shall constitute a
representation and warranty as to the accuracy and completeness of the information contained
therein. Any reference in this Agreement or any of the other Transaction Documents to the
“knowledge of” or “known to” any Company Party (or similar phrases) means the actual
knowledge of a Responsible Officer of such Company Party and such knowledge that such Person
could have obtained with reasonable investigation or due diligence. This Agreement and the
other Transactions Documents have been the subject of negotiations by the parties and shall
not be construed against Lender merely because of Lender’s involvement in their preparation.

     Section 12.13 Counterparts; Severability. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which when taken together shall constitute
one and the same Agreement. Delivery of an executed counterpart of this Agreement by telefacsimile
shall be equally as effective as delivery of an original executed counterpart of this Agreement.
Any party delivering an executed counterpart of this Agreement by telefacsimile also shall deliver an original executed counterpart of this Agreement but the failure
to deliver an original executed counterpart shall not affect the validity, enforceability, and
binding effect of this Agreement. Any provisions of this Agreement which are prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

[Signature Page Follows]

38

 

     In Witness Whereof, the parties hereto have caused this Amended and Restated Loan and
Security Agreement to be executed and delivered by their duly authorized officers as of the date
hereof.

     

	 	 	 	 	 
	 	Borrowers:

 
	 	
E-One, Inc. 

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 
	 	Address: 	1415 West 22nd Street, Suite 1100
Oak Brook, IL 60523
	 	Attn.: 	Treasurer    
	 	Fax No.: 	630-954-2041 

	 	 	 	 	 
	 	Elgin Sweeper Company

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 
	 	Address:	 1415 West 22nd Street, Suite 1100
Oak Brook, IL 60523 
	 	Attn.: 	Treasurer       
	 	Fax No.:       	630-954-2041 

[Signature Page to Amended and Restated Loan and Security Agreement]

 

	 	 	 	 	 
	 	Vactor Manufacturing Inc. 

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	Address:
        	1415 West 22nd Street, Suite 1100
Oak Brook, IL 60523 
	 	Attn.:         	Treasurer 
	 	Fax No.: 	630-954-2041    

	 	 	 	 	 
	 	E-One New York, Inc. 

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 
	 	Address:
        	1415 West 22nd Street, Suite 1100
Oak Brook, IL 60523 
	 	Attn.:         	Treasurer 
	 	Fax No.:       	 630-954-2041

[Signature Page to Amended and Restated Loan and Security Agreement]

 

 

	 	 	 	 	 
	 	Designated Representative as to each

Borrower:

Federal Signal Corporation

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 
	 	1415 West 22nd Street, Suite 1100

Oak Brook, IL 60523
        
	 	Attn:	General Counsel 
	 	Fax No.:	 630-954-2138  

[Signature Page to Amended and Restated Loan and Security Agreement]

 

 

	 	 	 	 	 
	 	Lender:

Banc of America Leasing & Capital, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	Address:
        	 231 S. LaSalle St.
8th Floor
Chicago, IL 60604
	 	Fax No.: 	312-974-9052    

[Signature Page to Amended and Restated Loan and Security Agreement]

 

 

Exhibit I

Definitions

     As used in this Agreement, the following terms shall have the following meanings (such
meanings to be equally applicable to both the singular and plural forms of the terms defined):

     “Accounting Month” means an accounting month of the Borrowers determined in accordance with
its system of accounting periods in use as of the Closing Date, as such system may be modified from
time to time with Lender’s prior approval.

     “ACH Receipts” means funds received from an Obligor in respect of automated or other
electronic funds transfers.

     “Advance” means each extension of credit pursuant to Section 1.1.

     “Advance Rate” means ninety-five percent (95%).

     “Adverse Claim” means a Lien, security interest, charge or encumbrance, or other right or
claim in, of or on any Person’s assets or properties in favor of any other Person; provided,
however, that an agreement to sell or exchange the Stock of any Person shall not constitute an
Adverse Claim with respect to such Stock if and so long as the sale or exchange of that Stock under
such agreement remains subject to the satisfaction of any conditions precedent (other than the
passage of time or the receipt of consideration).

     “Affiliate” means, as applied to any Person, any other Person who, directly or indirectly,
controls, is controlled by, or is under common control with, such Person. For purposes of this
definition, “control” means the possession, directly or indirectly, of the power to direct the
management and policies of a Person, whether through the ownership of Stock, by contract, or
otherwise.

     “Applicable Margin” means, with respect to any Loan, the percentage designated by Lender with
respect to such Loan and accepted by the applicable Borrower.

     “Authorized Person” means, with respect to any Company Party, any officer or other employee of
such Company Party or of the Designated Representative shown on the list of authorized officers set
forth on Schedule D, or any updated list provided to Lender by the Borrowers, the
Designated Representative or FSS with respect to its authorized officers.

     “Bankruptcy Code” means United States Bankruptcy Code of 1978, as amended, and any successor
statute thereto.

     “Board of Directors” means the board of directors (or comparable managers) of any of the
Company Parties or any committee thereof duly authorized to act on behalf of the board.

     “Borrowers” has the meaning set forth in the preamble to this Agreement.

Exhibit 1-1

 

     “Business Day” means any day that is not a Saturday, Sunday, or other day on which national
banks are authorized or required to close in Chicago, Illinois, except that, if a determination of
a Business Day shall relate to a LIBOR Loan, the term “Business Day” also shall exclude any day on
which banks are closed for dealings in Dollar deposits in the London interbank market.

     “Change of Ownership” means, with respect to any of the Borrowers, that FSS ceases to own,
free and clear of all Adverse Claims, all of the outstanding shares of Stock of such Borrower.

     “Certificate of Title” means the certificate of title or other document used to register with
the applicable state authority ownership of and liens on a Vehicle located in that state.

     “Closing Date” means December 20, 2007.

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

     “Collateral” has the meaning set forth in Section 3.1 of this Agreement.

     “Collections” means all cash collections and other cash proceeds received in respect of the
Leases, the Receivables related thereto, all cash proceeds of the Related Equipment and other
Related Security and including any proceeds of the sale or other disposition of such assets, all
proceeds of any insurance policies with respect to such Lease or Related Equipment, all gross
Recoveries, all early termination payments and any other full or partial repayments or payoffs, but
excluding any amounts that the Person receiving such cash collections and other cash proceeds is
required to pay under any sales or other similar surcharge tax imposed by any state, municipality
or other taxing authority (other than taxes imposed and calculated upon the income of such
receiving Person).

     “Company Parties” means the Borrowers and FSS and “Company Party” means any of the foregoing.

     “Concentration Condition” exists at any time, if as of the last day of any Accounting Month,
the aggregate NPV of all Leases in all Lease Pools having the same Obligor is equal to or exceeds
ten percent (10%) of the aggregate NPV of all Eligible Leases as of such date.

     “Convert” or “Conversion” means, with respect to any outstanding loan that is a LIBOR Loan,
its designation by a Borrower as a Fixed Rate Loan.

     “Custodian” means, Lender or, at any time that Lender elects to have a Person other than
Lender hold all or any portion of the originals of the Leases, a custodian named from time to time
in the Custodial Agreement.

     “Custodial Agreement” means an agreement in form and substance acceptable to Lender pursuant
to which the Custodian agrees, among other things, to hold originals of the Leases.

Ex. I-2

 

     “Cut-Off Date” means, unless another date is otherwise agreed upon in any instance by Lender
and any Borrower, (a) with respect to any Advance, the first calendar day of the month in which
such Advance occurs, and (b) with respect to any Substitution, the first calendar day of the month
following the date on which such Substitution is permitted pursuant to Section 5.2.

     “Deemed Collections” means the aggregate of all amounts the applicable Borrower shall have
been deemed, as provided in the following sentence, to have received as a Collections on the
Collateral. If at any time (i) the NPV of a Lease in a Borrower’s Lease Pool is either (A) reduced
as a result of any defective or rejected goods or services, any discount or any adjustment or
otherwise by a Company Party, in any capacity, (other than cash Collections on account of such
Lease) or (B) reduced or canceled as a result of a set-off in respect of any claim by any Person
(whether such claim arises out of the same or a related transaction or an unrelated transaction),
then the Borrower that is a party to such Lease shall be deemed to have received a Collections on
the related Collateral in the amount of such reduction in NPV, and (ii) a Lease in a Borrower’s
Lease Pool is determined not to have been an Eligible Lease as of the date of the related Advance
for which it was pledged (or the date of Substitution with respect to a Substituted Lease), then
the Borrower that is a party to such Lease shall be deemed to have received a Collection in full of
the Release Price for such Lease. The amount of Deemed Collections with respect to any Lease or
Related Equipment shall be net of any actual Collections received with respect to the event giving
rise to Deemed Collections from the related Obligor and remitted to the Lock-Box Account and swept
to the Lender’s Account.

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

     “Defaulted Lease” means any Lease as to which (i) the Obligor thereof has taken any action, or
suffered any event to occur, of the type described in Section 9.1(d) (as if references to Company
Party therein refer to such Obligor); (ii) an event of abatement or nonappropriation has occurred,
(iii) consistent with the Standard of Care, should be written off as uncollectible, (iv) any
Company Party or Third-Party Servicer has identified as uncollectible, or (v) any Scheduled
Payment, or part thereof, remains unpaid for ninety (90) days or more from the original due date
for such payment.

     “Delinquent Lease” means any Lease as to which a Scheduled Payment, or part thereof, remains
unpaid for at least thirty-one (31) days from the original due date (other than any Defaulted
Lease).

     “Designated Obligor” means an Obligor designated by Lender to the Borrowers in writing as
unacceptable to Lender.

     “Designated Representative” has the meaning set forth in Section 1.4(a) of this Agreement.

     “Discount Rate” means, as of any date of determination, a per annum rate equal to (a) with
respect to any LIBOR Loan, the LIBOR Interest Rate applicable to such LIBOR Loan as of

Ex. I-3

 

the date of its Advance plus one percent (1%), and (b) with respect to any Fixed Rate Loan,
the Fixed Interest Rate applicable to such Fixed Rate Loan.

     “Dollars” or “$” means United States dollars.

     “Eligible Lease” means any Lease identified on a schedule to a Request for Funding (or, with
respect to a Substituted Lease, on a schedule to a Request for Substitution) that meets all of the
following requirements:

     (a) such Lease was originated by a Borrower in the ordinary course of its business and
in conformance with its historic credit and collection practices;

     (b) the Obligor with respect to such Lease is the user of the Related Equipment under
such Lease in connection with the performance of public services and is located in the
United States and all such Related Equipment is located in the United States;

     (c) with respect to any Lease other than (i) the Initial Leases and (ii) those
Substituted Leases (as defined in the Existing Loan and Security Agreement documented prior
to March 24, 2005, and substituted pursuant to the Existing Loan and Security Agreement)
prior to the Closing Date, such Lease is in the form of one of the forms attached to this
Agreement or otherwise made pursuant to standard legal documentation for which Lender has
given its prior written consent;

     (d) such Lease is by its terms an absolute and unconditional obligation of the related
Obligor, non-cancelable (other than on account of any non-appropriation provision under such
Lease), and does not contain any option for prepayment or early termination by the Obligor
unless (i) the enforceable payment required thereunder for prepayment or early termination
is, as of any date of determination, equal to or greater than the applicable Borrower’s then
net outstanding balance for such Lease, or (ii) such termination arises under a
non-appropriation provision;

     (e) such Lease is net to the lessor of any maintenance, taxes, insurance or other
expenses and contains provisions requiring the related Obligor to assume all risk of loss or
malfunction of the Related Equipment;

     (f) such Lease is a Dollar-denominated Lease;

     (g) as of the applicable Cut-Off Date, as of the date of the Request for Funding or
Request for Substitution (as applicable) and as of the date of the Advance or Substitution
(as applicable), such Lease is not a Defaulted Lease or a Delinquent Lease;

     (h) the amount, term and frequency of Scheduled Payments due under each Eligible Lease
are accurately reflected on the schedule attached to the related Request for Funding for
such Lease or Request for Substitution for such Substituted Lease;

Ex. I-4

 

     (i) neither the applicable Borrower nor FSS has received notice of an Obligor’s
intention not to appropriate funds with respect to obligations owing under its Lease, and to
such Company Party’s knowledge, the Obligor under such Lease has not failed to appropriate
such funds with respect to payments arising during such Obligor’s current or upcoming fiscal
year;

     (j) the terms of such Lease have not been amended, waived or modified other than in
accordance with the applicable Borrower’s historic credit and collection practices;

     (k) (A) no Scheduled Payments due under such Lease are subject to any right of
rescission, set-off, claim, counterclaim or defense, including the defense of usury, (B)
giving effect to the terms of such Lease or the exercise by the applicable Borrower or its
assignee or the Obligor of any right under such Lease will not render such Lease
unenforceable in whole or in part, nor subject such Scheduled Payments to any right of
rescission, set-off, claim, counterclaim or defense, and (C) no such right of rescission,
set-off, claim, counterclaim or defense, including a defense arising out of a breach of the
Obligor’s right to quiet enjoyment of the Related Equipment, has been asserted with respect
to such Lease;

     (l) the Related Equipment leased under such Lease existed as of the start date of such
Lease, the applicable Borrower has received an executed acceptance certificate from the
related Obligor in respect thereof, and to such Borrower’s knowledge, no event resulting in
a destruction or loss of all or a material portion of such Related Equipment has occurred;

     (m) such Lease requires that the Obligor maintain the Related Equipment leased
thereunder in good repair and working order;

     (n) there is only one original executed counterpart of such Lease or, in the case of a
master lease agreement, such lease schedule or supplement, such counterpart constitutes
“chattel paper” under Section 9-102(11) of the UCC, and such counterpart (together with a
copy of any master lease agreement, if applicable) shall have been marked with a legend as
shall be appropriate or desirable to evidence the fact that it is subject to the Lien of
Lender under this Agreement, and shall have been delivered to Lender or its designated
Custodian, in each case, within thirty (30) days after the date of the Advance with respect
thereto;

     (o) there are no Insolvency Proceedings pending or to the applicable Borrower’s or
FSS’s knowledge, threatened asserting the insolvency of any Obligor under such Lease, and,
to such Borrower’s or FSS’s knowledge, each such Obligor is solvent;

     (p) such Lease was not originated in, nor is it subject to the laws of, any
jurisdiction, the laws of which would make unlawful the sale, transfer or assignment of such
Lease and the creation of a Lien in favor of Lender in any of the Collateral will not render
such Lease unenforceable as to the related Obligor;

Ex. I-5

 

     (q) such Lease is in full force and effect in accordance with its terms and neither the
applicable Borrower nor any other obligated party has suspended or reduced any payments or
obligations due or to become due thereunder by reason of a default by the other party to
such Lease;

     (r) such Lease is effective to create, and has created, a legal, valid and binding
obligation of the related Obligor to pay the Scheduled Payments (subject to nonappropriation
and any prepayment provisions stated therein) and perform its other obligations thereunder,
and of the applicable Borrower, enforceable in accordance with its terms except as such
enforcement may be limited by applicable bankruptcy, insolvency, reorganization or other
similar laws relating to or limiting creditors’ rights generally and by general principles
of equity (regardless of whether enforcement is sought in a proceeding in equity or at law)
and by applicable sovereign immunity laws;

     (s) the applicable Borrower has good and marketable title to the Lease and the Related
Security (other than Related Equipment), free and clear of any Adverse Claim except as
created in favor of Lender pursuant to the Transaction Documents;

     (t) the applicable Borrower’s interest in such Lease and Related Security has not been
sold, transferred, assigned or pledged by such Borrower to any Person other than Lender and,
upon grant to Lender of the Lien provided for in this Agreement, Lender will have a valid
and perfected first priority Lien on the Lease and on all Collections with respect thereto
free and clear of all Adverse Claims;

     (u) the Vehicles (or other Related Security) that are the subject of the Lease are
manufactured, distributed or sold by the applicable Borrower and have been delivered to the
Obligor;

     (v) the Obligor with respect to such Lease is not a Designated Obligor; and

     (w) with respect to any Lease other than the Initial Leases, (i) such Lease requires
the Obligor thereunder to obtain and maintain property and liability insurance with respect
to the Related Equipment under Lease and such insurance is in full force and effect and (ii)
the applicable Borrower holds either legal and equitable title to, and ownership of, or a
perfected, first priority security interest in, the Related Equipment under such Lease, free
and clear of any Adverse Claim (except as created pursuant to any Transaction Document and
any Permitted Lien).

     “Event of Default” has the meaning specified in Article IX of this Agreement.

     “Exchange Act” means the Securities Exchange Act of 1934, as in effect from time to time.

     “Excluded Amounts” has the meaning specified in Section 10.2.

Ex. I-6

 

     “Excluded Scheduled Payments” means (a) all Scheduled Payments under any Lease that has been
amended or modified by a Borrower unless such amendment or modification is permitted by this
Agreement or the Servicing Agreement or has otherwise been accepted by Lender, (b) all Scheduled
Payments in respect of any Defaulted Lease, and (c) all Scheduled Payments that as of the date of
determination are due under the terms of a Lease but remain unpaid.

     “Existing Loan and Security Agreement” has the meaning specified in the Preliminary
Statements.

     “Finance Charges” means, with respect to a Lease, any late payment charges or similar charges
owing by an Obligor pursuant to such Lease or any fees and charges, including all not-sufficient
funds fees and extension and modification fees related to such Lease.

     “Fixed Interest Rate” has the meaning set forth in Section 1.3(a).

     “Fixed Rate” means the fixed rate per annum determined by Lender to be the Treasury Rate
corresponding to the weighted average life of the Leases designated on the related Request for
Funding with respect to the related Advance.

     “Fixed Rate Loan” means a Loan that bears interest by reference to the Fixed Rate.

     “FSS” means Federal Signal Corporation, a Delaware corporation, and its successors and assigns
by operation of law.

     “FSS Guaranty” means each Amended and Restated Continuing Guaranty, dated as of the date
hereof, executed by FSS with respect to the respective Obligations of the Borrowers, in favor of
Lender, in the form of Exhibit VIII hereto, as any of them may be amended or modified and
in effect from time to time.

     “GAAP” means accounting principles as in effect from time to time generally accepted in the
United States, applied by FSS and its Subsidiaries on a basis consistent with the preparation of
the FSS’s consolidated financial statements.

     “Governing Documents” means, with respect to any Person, the certificate or articles of
incorporation, by-laws, or other organizational documents of such Person.

     “Governmental Authority” means any federal, state, local, or other governmental or
administrative body, instrumentality, department, or agency or any court, tribunal, administrative
hearing body, arbitration panel, commission, or other similar dispute-resolving panel or body.

     “Indemnified Amounts” has the meaning set forth in Section 10.1.

     “Indemnified Party” has the meaning set forth in Section 10.1.

Ex. I-7

 

     “Initial Leases” means with respect to (a) E-One’s Lease Pool, the Leases identified on the
schedule to the Request for Funding submitted under the initial Advance made under, and as such
terms are defined in, the Existing Loan and Security Agreement, to the extent that any such Lease
is outstanding on the Closing Date and (b) with respect to each other Borrower, the Leases
identified on the schedule to the Request for Funding with respect to the initial Advance for such
Borrower if such Lease was originated and documented prior to the Closing Date.

     “Insolvency Proceeding” means any proceeding commenced by or against any Person under any
provision of the Bankruptcy Code or under any other state or federal bankruptcy or insolvency law,
assignments for the benefit of creditors, formal or informal moratoria, compositions, extensions
generally with creditors, or proceedings seeking reorganization, arrangement, or other similar
relief.

     “Interest Rate” means the interest rate, as determined in Section 1.3(a), that is accruing on
a Loan.

     “Lease” means any and all instruments, agreements, invoices or other writings constituting or
related to a lease contract designated as Collateral on a Request for Funding or a Request for
Substitution and confirmed as approved pursuant to the terms of this Agreement, and all rights with
respect thereto, including all guaranties and other agreements or arrangements of whatever
character from time to time supporting or securing payment of any lease contract and all rights
with respect to any agreements or arrangements with the vendors, dealers or manufacturers of the
equipment to the extent specifically related to any lease contract), whether or not any such
transaction is at any time determined to create a lease or a security interest with respect to the
Related Equipment; provided that, from and after the date, if any, on which such Lease is
repurchased, or substituted in accordance with Section 5.2, such Lease shall no longer constitute a
“Lease” for purposes of this Agreement.

     “Lease and Terms Approval” has the meaning set forth in Section 1.1(d) of this Agreement.

     “Lease File” means the following documents:

     (i) with respect to each Lease, the one and only executed original counterpart of the
Lease that constitutes “chattel paper” for purposes of Sections 9-102(11) of the UCC;

     (ii) with respect to each Lease other than the Initial Leases, evidence of insurance
and any other documents evidencing or related to any Insurance Policy, and with respect to
each of the Initial Leases, evidence of insurance and any other documents evidencing or
related to any Insurance Policy, if any;

     (iii) (a) with respect to each Lease of a Vehicle or other certificate of title goods
other than the Initial Leases, originals of the Certificate of Title indicating a Borrower
(or a Borrower as agent) as lienholder of record with respect to the related Vehicle at the
applicable state department or agency in charge of vehicle titling and other

Ex. I-8

 

evidence that the applicable Borrower has a perfected security interest in the Related
Equipment, and (b) with respect to each of the Initial Leases, to the extent available with
respect to any such Lease, originals of the Certificate of Title, if available, or if
unavailable, a copy of the manufacturer’s statement of origin (MSO) and such other documents
as E-One may have on file in lieu of the original Certificate of Title, indicating that
E-One has a perfected security interest in the Related Equipment;

     (iv) with respect to each Lease, the Acceptance Certificate; and

     (v) with respect to each Lease, an opinion of counsel to the Obligor relating to the
lease transaction.

     “Lease Pool” means, with respect to each Borrower, the Leases designated as Collateral for
Advances made to such Borrower.

     “Lender” means Banc of America Leasing & Capital, LLC, its successors and assignees.

     “Lender Expenses” means all (a) costs or expenses (including taxes, and insurance premiums)
required to be paid by any Company Party under any of the Transaction Documents that are paid or
incurred by Lender, (b) fees or charges paid or incurred by Lender in connection with Lender’s
transactions with the Borrowers, including fees or charges for photocopying, notarization, couriers
and messengers, telecommunication, public record searches (including tax lien, litigation, and UCC
searches and including searches with the department of motor vehicles), filing, recording,
publication, appraisal (including periodic collateral appraisals or business valuations to the
extent of the fees and charges (and up to the amount of any limitation) contained in this
Agreement), (c) costs and expenses incurred by Lender in the disbursement of funds to any Borrower
(by wire transfer or otherwise), (d) charges paid or incurred by Lender resulting from the dishonor
of checks, (e) reasonable costs and expenses paid or incurred by Lender to correct any Default or
Event of Default hereunder or to enforce any provision of the Transaction Documents, or in gaining
possession of, maintaining, handling, preserving, storing, shipping, selling, preparing for sale,
or advertising to sell the Collateral or any portion thereof, irrespective of whether a sale is
consummated, (f) audit fees and expenses of Lender related to audit examinations of the books or
records of any Company Party permitted pursuant to Section 7.1(d) hereof, (g) solely with respect
to Recourse Obligations, reasonable costs and expenses of third party claims or any other suit paid
or incurred by Lender in enforcing or defending the Transaction Documents or in connection with the
transactions contemplated by the Transaction Documents or Lender’s relationship with any Company
Party, (h) Lender’s reasonable fees and expenses (including reasonable attorneys’ fees, subject to
separately agreed upon limits) incurred in advising, structuring, drafting, reviewing or
administering the Transaction Documents, and (i) solely with respect to Recourse Obligations,
Lender’s reasonable fees and expenses (including reasonable attorneys’ fees) incurred in waiving,
amending, terminating, enforcing (including reasonable attorneys’ fees and expenses incurred in
connection with a “workout,” a “restructuring,” or an Insolvency Proceeding concerning any Company
Party or in exercising rights or remedies under the Transaction Documents whether or not allowed as
a claim in any Insolvency Proceeding), or defending the Transaction Documents, irrespective of
whether suit is brought, or in taking any remedial or enforcement action concerning the Collateral.

Ex. I-9

 

     “Lender’s Account” has the meaning set forth in Section 2.3(b) of this Agreement.

     “Lender’s Account Bank” means the bank selected by Lender that holds the Lender’s Account.

     “LIBO Rate” means the rate per annum equal to the published rate for thirty (30) day reserve
adjusted London Interbank Offered Rates (LIBOR) for Dollar deposits as published in the “Money
Rates” Section of The Wall Street Journal, National Edition, or in such other publication as Lender
may, from time to time hereafter, designate in writing. The LIBO Rate shall be adjusted as of each
LIBOR Reset Date to reflect the most recently published rate (regardless of the stated effective
date for such rate) and be applied to all Obligations making reference to the LIBO Rate until the
subsequent adjustment.

     “LIBOR Interest Period” means the period from the date of the initial LIBOR Loan to the
initial LIBOR Reset Date and thereafter, from and including such LIBOR Reset Date to the next
succeeding LIBOR Reset Date with respect to any LIBOR Loans outstanding at any time during such
period.

     “LIBOR Interest Rate” has the meaning set forth in Section 1.3(a).

     “LIBOR Loan” means any Loan that bears interest by reference to the LIBO Rate.

     “LIBOR Reset Date” means the fifteenth (15th) day of each calendar month (including
such date occurring immediately prior to the Closing Date), or if such date is not a Business Day,
the immediately following Business Day.

     “Lien” or “Liens” 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), any filing or agreement to file a financing statement as debtor under the UCC or
any similar statute, or any subordination arrangement in favor of another Person.

     “Loan” or “Loans” means, as of any date of determination, the outstanding principal balance of
an Advance or of all Advances to a Borrower, or to all Borrowers, as the context may require.

     “Loan Account” has the meaning set forth in Section 1.2 of this Agreement.

     “Lock-Box” means each locked postal box with respect to which a Lock-Box Bank has been granted
exclusive access for the purpose of retrieving and processing payments made on the Leases and other
proceeds of any Collateral.

     “Lock-Box Account” has the meaning set forth in Section 2.2 of this Agreement.

     “Lock-Box Bank” means any bank where a Lock-Box Account is established.

Ex. I-10

 

     “Lock-Box Control Agreement” means an agreement regarding access to and control over a
Lock-Box and Lock-Box Account made in favor of Lender and substantially in the form attached to
this Agreement as Exhibit V.

     “Material Adverse Effect” means a material adverse effect on (i) the ability of any Company
Party to perform its obligations under this Agreement or any of the other Transaction Documents to
which it is a party, (ii) the legality, validity or enforceability of this Agreement or any other
Transaction Document, (iii) Lender’s interest in or Liens on (including Lender’s perfection and
first priority with respect to) the Receivables generally or in any significant portion of the
Collateral or the Collections with respect thereto, or (iv) the collectibility of the Receivables
generally or of any material portion of the Receivables.

     “Monthly Servicing Report” means a monthly report furnished to Lender in form and substance
acceptable to Lender and Borrowers, which initially shall be in the form attached hereto as Exhibit
IX.

     “NPV” means, as of any date of determination with respect to any Lease, the discounted present
value of the Scheduled Payments due or to become due under such Lease after the applicable Cut-Off
Date (and assuming that all such Scheduled Payments are payable and paid on the 15th day of the
month in which such Scheduled Payment is due, regardless of the actual due date), discounted back
to such date using, except as provided for purposes of the Over Collateralization, the monthly
equivalent of the Discount Rate.

     “Obligations” means all Advances, Loans, debts, principal, interest, premiums, liabilities,
obligations, fees, charges, costs, expenses (including Lender Expenses), guaranties, covenants, and
duties of any kind and description owing by any of the Borrowers to Lender pursuant to or evidenced
by the Transaction Documents and irrespective of whether for the payment of money, whether direct
or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, and
including any interest, fees, expenses or other amounts that, but for the provisions of the
Bankruptcy Code, would have accrued). Any reference in this Agreement or in the Transaction
Documents to the Obligations shall include all amendments, changes, extensions, modifications,
renewals replacements, substitutions, and supplements, thereto and thereof, as applicable, both
prior and subsequent to any proceeding under the Bankruptcy Code or similar insolvency law.

     “Obligor” means any Person obligated to make payments pursuant to a Lease.

     “Original Equipment Cost” means, as of any date of determination, the purchase price of any
Related Equipment as invoiced to the Obligor by a dealer.

     “Over Collateralization” means, as of the last Business Day of any Accounting Month, an
amount, as calculated by the Lender, equal to the positive amount, if any, by which the NPV of
Scheduled Payments other than Excluded Scheduled Payments of all Leases in a Lease Pool exceeds one
hundred ten percent (110%) of the outstanding Loans to the applicable Borrower as of such date. For
purposes of calculating Over Collateralization, the NPV of such Scheduled Payments shall be
discounted back to the first (1st) day of such month using the monthly

Ex. I-11

 

equivalent of the Discount Rate (as determined by reference to LIBOR Loans) and further
assuming that all such Scheduled Payments are payable on the fifteenth (15th) day of the calendar
month in which such Scheduled Payment is due, regardless of the actual due date. Such calculation
shall be made to reflect the amendments to Leases that a Borrower has documented in such prior
Accounting Month as allowed under the Servicing Agreement and reported to Lender by the fourth
(4th) day of the month such payment is due.

     “Paid in Full” means, with respect to the amounts in question, payment of all such amounts
owing under the Transaction Documents according to the terms thereof, whether or not the same would
be or is allowed or disallowed in whole or in part in, or would accrue after the commencement of,
any Insolvency Proceeding. No payment of any of the Obligations shall be considered paid or
applied hereunder to the extent that, at any time, all or any portion of such payment is declared a
Voidable Transfer. An obligation shall be considered Paid in Full if the only obligation remaining
is an inchoate obligation with respect to possible indemnity claims for events, circumstances or
conditions not yet in existence, notwithstanding the survival of such indemnity.

     “Person” means an individual, partnership, limited liability company, corporation (including a
business trust), joint stock company, trust, unincorporated association, joint venture or other
entity, or a government or any political subdivision or agency thereof.

     “Permitted Liens” means Liens attaching to any Related Equipment that constitute (a) the
rights and interests of the related Obligor under a Lease in such Related Equipment, (b) any
statutory mechanic’s or landlord’s liens arising in the ordinary course of business to secure
obligations arising with respect to the Related Equipment to which such liens attach, which
obligations are either not yet due and payable or are not delinquent and are discharged in the
ordinary course of business, and (c) with respect to Related Equipment that constitutes fire trucks
or other emergency response vehicles, Liens that are subordinate to the Lien in favor of Lender
held by the Pennsylvania Emergency Management Agency (PEMA) arising pursuant to its Volunteer Fire
Company, Ambulance Services and Rescue Squad Assistance program and securing obligations that
either are not yet due and payable or are not delinquent and are discharged in the ordinary course
of business.

     “Principal Lease Documents” means:

     (i) with respect to any Lease, each original executed lease agreement (including any
master lease agreement and any original executed supplement or amendment thereto) pursuant
to which such Receivable arises or which evidence such Receivable;

     (ii) with respect to any Lease other than the Initial Leases, the original Certificate
of Title indicating a Borrower (or a Borrower as agent) as lienholder of record with respect
to the related Vehicle at the applicable state department or agency in charge of vehicle
titling; and

Ex. I-12

 

     (iii) with respect to the Initial Leases, to the extent available with respect to any
such Lease, the original Certificate of Title, if available, and if unavailable, a copy of
the manufacturer’s statement of origin (MSO) or such other evidence that indicates the
Borrowers as lienholder of record with respect to the related Vehicle at the applicable
state department or agency in charge of vehicle titling.

     “Rate Compression Amount” has the meaning set forth in Section 2.5(a) of this Agreement.

     “Receivable” means all Scheduled Payments, all Finance Charges and any other indebtedness and
obligations owed to a Borrower with respect to a Lease in such Borrower’s Lease Pool or the Related
Equipment after the applicable Cut-Off Date, whether constituting an account, chattel paper,
instrument or general intangible, arising in connection with the provision of financing by a
Borrower to a purchaser or lessee of equipment. Indebtedness and other rights and obligations
arising from any one transaction, including, without limitation, indebtedness and other rights and
obligations represented by an individual invoice, shall constitute a Receivable separate from a
Receivable consisting of the indebtedness and other rights and obligations arising from any other
transaction; provided further, that any indebtedness, rights or obligations referred to in the
immediately preceding sentence shall be a Receivable regardless of whether the account debtor or
the Borrowers treat such indebtedness, rights or obligations as a separate payment obligation. A
Receivable shall also include any such indebtedness and other obligations acquired by the Borrowers
pursuant to any assignment from any entity which initially originated such Lease.

     “Records” means, with respect to any Receivable, all Leases, Lease Files and other documents,
books, records and other information (including computer programs, tapes, disks, punch cards, data
processing software and related property and rights) relating to such Receivable, any Related
Security therefor and the related Obligor.

     “Recourse Obligations” means any and all of the following obligations of a Borrower: (i) all
Rate Compression Amounts calculated, with respect to such Borrower, by reference to the Loans made
to such Borrower; (ii) all amounts payable in respect of indemnifications under Article X, if any;
(iii) all Servicer Transition Costs; (iv) all amounts payable under Sections 1.5 or 2.6; (v) all
Deemed Collections on account of Leases in such Borrower’s Lease Pool; and (vi) all Lender
Expenses.

     “Recoveries” means, with respect to any Defaulted Lease and for any period of determination
occurring after the date on which the related Lease becomes a Defaulted Lease, all cash payments
received by any Company Party, Servicer or Subservicer from or on behalf of an Obligor regarding
such Defaulted Lease or from liquidation of the Related Equipment, including but not limited to
Scheduled Payments and any payment made by any Person that is contractually obligated to a Borrower
to make such payment and including payments made under any third party agreement in respect of a
Defaulted Lease. As used herein, “net Recoveries” means Recoveries in any period, as reduced by
any out-of-pocket expenses (including reasonable attorneys’ fees) incurred (whether or not paid in
such period) by or on behalf of a Borrower in

Ex. I-13

 

enforcing such Lease in such Borrower’s Lease Pool or obtaining such Recovery, and “gross
Recoveries” means Recoveries prior to any such reduction.

     “Related Equipment” means with respect to any Lease, the Vehicle and such other goods that are
the subject of such Lease.

     “Related Security” means, with respect to any Lease and the related Receivable:

     (i) the Lock-Box Account(s),

     (ii) the Related Equipment or other inventory and goods (including returned or
repossessed inventory or goods), if any, the sale, financing or lease of which by the
Borrowers gave rise to such Receivable, and all insurance contracts with respect thereto,

     (iii) all other security interests or liens and property subject thereto from time to
time, if any, purporting to secure payment of such Receivable, whether pursuant to the Lease
related to such Receivable or otherwise, together with all financing statements and security
agreements describing any collateral securing such Receivable,

     (iv) all guaranties, letters of credit, insurance, security deposits and other
agreements or arrangements of whatever character from time to time supporting or securing
payment of such Receivable whether pursuant to the Lease related to such Receivable or
otherwise,

     (v) all service contracts and other contracts and agreements associated with such
Receivable,

     (vi) all Principal Lease Documents, the Lease File and Records related to such
Receivable,

     (vii) all of the applicable Borrower’s right, title and interest in, to and under the
Servicing Agreement and each other Transaction Document executed in favor of or otherwise
for the benefit of the applicable Borrower, and

     (viii) all proceeds of any of the foregoing.

     “Release Price” means, with respect to a Lease that is determined to have not been an Eligible
Lease as of the date of the related Advance, or is otherwise permitted to be released upon deposit
of the “Release Price”, an amount equal to ninety-five percent (95%) of the NPV for such Lease at
such time.

     “Request for Approval of Leases and Terms” has the meaning set forth in Section 1.1(d) of this
Agreement.

     “Request for Funding” has the meaning set forth in Section 1.1(e) of this Agreement.

Ex. I-14

 

     “Request for Substitution” means a request in the form of Exhibit III-B hereto
submitted to Lender in connection with a Substitution requested pursuant to Section 5.2 of this
Agreement.

     “Responsible Officer” means, with respect to any Company Party, its chief financial officer or
treasurer or Person acting in a similar capacity and who is authorized to sign on behalf of that
Company Party.

     “Scheduled Payments” means all periodic payments that are due and payable or become due under
any Lease for the use of the Related Equipment during the term thereof, but excluding any amounts
that are due and payable or become due in respect of (i) advance payments, (ii) security deposits,
(iii) any fair market value purchase options with respect to the Related Equipment, (iv)
maintenance services with respect to the Related Equipment, and (v) property, sales or other
similar taxes imposed by any state, municipality or other taxing authority (other than taxes
imposed and calculated upon the income of such receiving Person).

     “Servicer” means initially, FSS and after a Termination Event, the Third-Party Servicer then
authorized pursuant to Article VIII to service, administer and collect on the designated
Collateral.

     “SEC” means the Securities and Exchange Commission.

     “Servicer Transition Costs” means any documented costs and expenses reasonably incurred by
Lender or by any Third-Party Servicer (if other than Lender) in connection with a transfer of
servicing from the initial Servicer (or Subservicer) to a Third-Party Servicer appointed pursuant
to Section 9(a) of the Servicing Agreement, and including any such costs and expenses of retitling
any Vehicles.

     “Servicing Agreement” initially means the Amended and Restated Servicing and Title Agency
Agreement, substantially in the form of Exhibit VI to this Agreement, executed and
delivered by FSS, the Borrowers, and Lender, and after the occurrence of a Termination Event
thereunder and the appointment of a Third-Party Servicer, any other written agreement, if any,
describing the responsibilities of any successor Servicer or Subservicer.

     “Settlement Date” means the fifteenth (15th) day of each calendar month, or if such
date is not a Business Day, then the next subsequent Business Day.

     “Standard of Care” has the meaning set forth in Section 6 of the Servicing Agreement.

     “Stock” means all shares, options, warrants, interests, participations, or other equivalents
(regardless of how designated) of or in a Person, whether voting or nonvoting, including common
stock, preferred stock, or any other “equity security” (as such term is defined in Rule 3a11-1 of
the General Rules and Regulations promulgated by the SEC under the Exchange Act).

Ex. I-15

 

     “Subservicer” means each of the Borrowers with respect to Leases in its respective Lease Pools
or such other Person as is designated by Lender to perform the duties of Subservicer under the
Servicing Agreement and in accordance with Section 8.1.

     “Subsidiary” means, as to FSS, any corporation or other entity of which more than fifty
percent (50%) of the outstanding Stock having ordinary voting power for the election of the board
of directors of such corporation or similar governing body in the case of a non-corporation
(irrespective of whether or not, at the time, Stock of any other class or classes of such
corporation or other entity shall have or might have voting power by reason of the happening of any
contingency) is at the time directly or indirectly owned by FSS or by one or more of its
Subsidiaries.

     “Substituted Lease” means a Lease that as of the date of a Request for Substitution and the
date of Substitution is an Eligible Lease, which is substituted for a Lease pursuant to Section
5.2.

     “Substitution” means the removal of a Lease from the Lien hereunder and its replacement with a
Substituted Lease pursuant to Section 5.2 hereof.

     “Taxes” has the meaning set forth in Section 1.6.

     “Termination Event” has the meaning set forth in the Servicing Agreement.

     “Third-Party Servicer” means any Person, other than a Company Party or their Affiliates, that
is appointed as a successor Servicer or Subservicer, including but not limited to Lender.

     “Third-Party Servicer Costs and Fees” means fees and reasonable out-of-pocket costs and
expenses payable to any Person pursuant to a Servicing Agreement in connection with the performance
of servicing (or subservicing), collection and/or remarketing of the Related Equipment and the
Related Security, including the administration of certificates of title related thereto, but
excluding any Servicer Transition Costs; provided, however, if a Company Party is the Servicer or
Subservicer performing such duties, Third Party Servicer Costs and Fees shall be (a) limited to the
reasonable out-of-pocket costs and expenses incurred directly in connection with such collection or
enforcement of a Defaulted Lease or with remarketing of the Related Equipment under a Lease and (b)
payable solely from Recoveries with respect to that specific Defaulted Lease or that specific
Related Equipment and not from any other Collections.

     “Transaction Documents” means, collectively, this Agreement, each Request for Funding, each
Request for Substitution (if any), the Servicing Agreement (so long as either FSS or the Borrowers
have obligations thereunder), the Lock-Box Control Agreement(s), the Custodial Agreement (if any),
the FSS Guaranties, the powers of attorney executed pursuant to Section 1(d) of the Servicing
Agreement and all other instruments, documents and agreements executed and delivered in connection
herewith or therewith.

     “Treasury Rate” means a per annum rate equal to the bond equivalent yield on actively traded
U.S. government securities with the closest applicable maturity as set forth on page

Ex. I-16

 

“USD” of the
Bloomberg Financial Markets Screen (or if not available, any other nationally recognized trading
screen reporting on-line intra-day trading in United States government securities) at 11:00 a.m.
(New York time) on such date of determination, or in the event no such nationally recognized
trading screen is available, the arithmetic mean of the yields for the two
columns under the heading “Week Ending” published in the Federal Reserve H.15 Statistical
Release under the caption “Treasury Constant Maturities” for the closest applicable maturity.

     “Type” means, with respect to any Loan, either a Fixed Rate Loan or a LIBOR Loan, as the case
may be.

     “UCC” means the Uniform Commercial Code as from time to time in effect in the specified
jurisdiction.

     “Vehicle” means the fire truck, emergency response vehicle or other motorized municipal
vehicle that is the subject of a Lease.

     “Voidable Transfer” has the meaning set forth in Section 12.3.

Ex. I-17

 

Exhibit II

Form of Request For Approval of Leases and Terms

                    , 20___

	 	 	 
	To:

	 	Banc of America Leasing & Capital, LLC
	 

	 	231 S. LaSalle Street, 8th Floor
	 

	 	Chicago, IL 60604
	 
	 	 
	From:

	 	Federal Signal Corporation, as the Designated Representative
	 

	 	1415 West 22nd Street, 16th Floor
	 

	 	Oak Brook, IL 60523
	 
	 	 
	 

	 	[Use applicable Borrower, delete others]
	 
	 	 
	 

	 	E-One, Inc.
	 

	 	1415 West 22nd Street, Suite 1100
	 

	 	Oak Brook, IL 60523
	 
	 	 
	 

	 	Elgin Sweeper Company
	 

	 	1415 West 22nd Street, Suite 1100
	 

	 	Oak Brook, IL 60523
	 
	 	 
	 

	 	Vactor Manufacturing Inc.
	 

	 	1415 West 22nd Street, Suite 1100
	 

	 	Oak Brook, IL 60523
	 
	 	 
	 

	 	E-One New York, Inc.
	 

	 	1415 West 22nd Street, Suite 1100
	 

	 	Oak Brook, IL 60523

			
	     Re:	 	Request for Approval of Leases and Terms

     We refer to that Amended and Restated Loan and Security Agreement dated as of December 20,
2007 (the “Loan Agreement”) among E-One, Inc, a Delaware corporation (“E-One”), Elgin Sweeper
Company, a Delaware corporation (“Elgin”), Vactor Manufacturing Inc., an Illinois corporation
(“Vactor”), E-One New York, Inc. (formerly known as Saulsbury Fire Rescue, Inc.), a New York
corporation (“EONY”; E-One, Elgin, Vactor, and EONY shall be collectively referred to herein as the
“Borrowers” and each individually as a “Borrower”), and you. Capitalized terms used herein and not
otherwise defined shall have the meanings ascribed thereto in the Loan Agreement.

     Pursuant to Section 1.1(d) of the Loan Agreement, we hereby request your approval of the
Leases described on Annex A hereto (each a “Proposed Lease”). The proposed Cut-Off Date applicable
to all Proposed Leases described on Annex A is                     , 20___. Except as

Ex. II-1

 

described on Annex B hereto, each of the Proposed Leases has been documented without deviation
from the applicable Borrower’s standard lease forms attached to the Loan Agreement as Exhibit VII.

     We request your response in the form of the Lease and Terms Approval attached hereto as Annex
C.

     The undersigned hereby certifies that [she/he] is an Authorized Person of the undersigned
Borrower or of the Designated Representative under the Loan Agreement and submits this Request for
Approval of Leases and Terms on behalf of that Borrower.

[Signature Page Follows]

Ex. II-2

 

	 	 	 	 	 
	 	Borrower:

[Use applicable Borrower; delete others]

[E-One, Inc. 

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	] 
	 
	 
	 	
[Elgin Sweeper Company

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	] 
	 
	 
	 	
[Vactor Manufacturing Inc. 

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	] 
	 
	 
	 	[E-One New York, Inc. 

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	] 
	 
	 	[or

 	 
	 
	 	Designated
Representative on behalf of
 [insert
applicable Borrower]:

Federal Signal Corporation

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	] 

Ex. II-3

 

	 	 	 	 	 

Annex A

to Request for Approval of Leases and Terms

Description of Leases

[See attached Chart.]

Ex. II-4

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Scheduled	 	Number and	 	Aggregate Gross
	 	 	 	 	 	 	 	 	Description	 	Original	 	 	 	 	 	Payments	 	Frequency of	 	Balance of all
	Lease ID	 	 	 	Obligor Name and	 	 	 	of Related	 	Equipment	 	Start	 	Maturity	 	(Dollar Amount of	 	Remaining Scheduled	 	Remaining Scheduled
	Number	 	Borrower	 	Address	 	Vehicle VIN	 	Equipment	 	Cost	 	Date	 	Date	 	each)	 	Payments	 	Payments
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

Ex. II-5

 

Annex B

To Request for Approval of Leases and Terms

	 	 	 	 	 
	Lease ID No.	 	Obligor	 	Deviation
	 
	 	 	 	 

Ex. II-6

 

Annex C

to Request for Approval of Leases and Terms

Form of Lease and Terms Approval 

                    , 20___

	 	 	 
	To:
	 	Federal Signal Corporation, as the Designated Representative
	 
	 	1415 West 22nd Street, 16th Floor
	 
	 	Oak Brook, IL  60523
	 
	 	 
	 
	 	[Use applicable Borrower, delete others]
	 
	 	 
	 
	 	E-One, Inc.
	 
	 	1415 West 22nd Street, Suite 1100
	 
	 	Oak Brook, IL  60523
	 
	 	 
	 
	 	Elgin Sweeper Company
	 
	 	1415 West 22nd Street, Suite 1100
	 
	 	Oak Brook, IL  60523
	 
	 	 
	 
	 	Vactor Manufacturing Inc.
	 
	 	1415 West 22nd Street, Suite 1100
	 
	 	Oak Brook, IL  60523
	 
	 	 
	 
	 	E-One New York, Inc.
	 
	 	1415 West 22nd Street, Suite 1100
	 
	 	Oak Brook, IL  60523
	 
	 	 
	From:
	 	Banc of America Leasing & Capital, LLC
	 
	 	231 S. LaSalle Street, 8th Floor
	 
	 	Chicago, IL  60604

			
	     Re:	 	Approval of Leases and Terms

Ladies and Gentlemen:

     We refer to that Amended and Restated Loan and Security Agreement dated as of December 20,
2007 (the “Loan Agreement”) among E-One, Inc, a Delaware corporation (“E-One”), Elgin Sweeper
Company, a Delaware corporation (“Elgin”), Vactor Manufacturing Inc., an Illinois corporation
(“Vactor”), E-One New York, Inc. (formerly known as Saulsbury Fire Rescue, Inc.), a New York
corporation (“EONY”; E-One, Elgin, Vactor, and EONY shall be collectively referred to herein as the
“Borrowers” and each individually as a “Borrower”), and us. Capitalized terms used herein and not
otherwise defined shall have the meanings ascribed thereto in the Loan Agreement.

Ex. II-7

 

     Pursuant to Section 1.1(d) of the Loan Agreement, and in connection with the Request for
Approval of Leases and Terms dated as of                     , 20___from you to us, we hereby notify you of
our approval of the Leases set forth on Schedule A hereto.

     The aggregate estimated Advance is [                                        ].

     The proposed Applicable Margin with respect to the requested Advance is ___%.

     The expected Discount Rate with respect to the requested Advance, if made as a LIBOR Loan is
___%, and if made as a Fixed Rate Loan is ___%.

     The Requested Advance would be made for the account of [ applicable Borrower ].

	 	 	 	 	 
	 	Banc of America Leasing & Capital, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

Ex. II-8

 

	 	 	 	 	 

Schedule A

to Lease and Terms Approval

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Aggregate of	 	 	 	 	 	 	 
	Lease ID	 	 	 	 	 	 	 	 	 	Cut-Off	 	 	Remaining Scheduled	 	 	Estimated	 	 	Estimated	 
	Number	 	Obligor	 	 	Borrower	 	 	Date	 	 	Payments	 	 	NPV	 	 	Advance Amount	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

Ex. II-9

 

Exhibit III-A

Form of Request for Funding of Advance or Conversion

                    , 20___

	 	 	 
	To:
	 	Banc of America Leasing & Capital, LLC
	 
	 	231 S. LaSalle Street, 8th Floor
	 
	 	Chicago, IL  60604
	 
	 	 
	From:
	 	Federal Signal Corporation, as the Designated Representative
	 
	 	1415 West 22nd Street, 16th Floor
	 
	 	Oak Brook, IL  60523
	 
	 	 
	 
	 	[Use applicable Borrower, delete others]
	 
	 	 
	 
	 	E-One, Inc.
	 
	 	1415 West 22nd Street, Suite 1100
	 
	 	Oak Brook, IL  60523
	 
	 	 
	 
	 	Elgin Sweeper Company
	 
	 	1415 West 22nd Street, Suite 1100
	 
	 	Oak Brook, IL  60523
	 
	 	 
	 
	 	Vactor Manufacturing Inc.
	 
	 	1415 West 22nd Street, Suite 1100
	 
	 	Oak Brook, IL  60523
	 
	 	 
	 
	 	E-One New York, Inc.
	 
	 	1415 West 22nd Street, Suite 1100
	 
	 	Oak Brook, IL  60523

			
	Re:	 	Request for Funding of Advance or Conversion

Ladies and Gentlemen:

     We refer to that Amended and Restated Loan and Security Agreement dated as of December 20,
2007 (the “Loan Agreement”) among E-One, Inc, a Delaware corporation (“E-One”), Elgin Sweeper
Company, a Delaware corporation (“Elgin”), Vactor Manufacturing Inc., an Illinois corporation
(“Vactor”), E-One New York, Inc. (formerly known as Saulsbury Fire Rescue, Inc.), a New York
corporation (“EONY”; E-One, Elgin, Vactor, and EONY shall be collectively referred to herein as the
“Borrowers” and each individually as a “Borrower”), and you. Capitalized terms used herein and not
otherwise defined shall have the meanings ascribed thereto in the Loan Agreement.

Ex. III-A-1

 

     [For an Advance: Pursuant to Section 1.1(e) of the Loan Agreement, we hereby request an
Advance under the Loan Agreement as follows:

	 	1.	 	The proposed date of the Advance (the “Advance Date”) is                     , 20___,
which is a Business Day.
	 
	 	2.	 	The estimated principal amount of the Advance is $                    .
	 
	 	3.	 	The Advance is requested for the account of [insert applicable Borrower(s)].
Such Advance has been authorized by all necessary corporate action and will not cause
the requesting Borrower to exceed the maximum principal amount that may be outstanding
under the Loan Agreement pursuant to such Borrower’s corporate approvals.
	 
	 	4.	 	Each Lease to be included in the requesting Borrower’s Lease Pool and as
Collateral for the Obligations of the requesting Borrower (but without limiting any
prior designation of Leases as Collateral) is listed on the schedule set forth as Annex
A hereto. Set forth opposite the identification number of each Lease is the estimated
NPV of such Lease provided to us by you pursuant to the related Lease and Terms
Approval, calculated as of the Advance Date.
	 
	 	5.	 	We request that such Advance be a [LIBOR Loan/Fixed Rate Loan].
	 
	 	6.	 	We confirm that [(a) If the Advance is to be a Fixed Rate Loan, the weighted
average life of the Leases listed on Annex A, as of the date of the Advance is
[                    ], and (b)] the Applicable Margin with respect to the requested Advance shall
be ___%.
	 
	 	7.	 	Each Lease listed on Annex A hereto is as of the date hereof and will be as of
the proposed Advance Date an Eligible Lease.]

     [For a Conversion: Pursuant to Section 1.1(e) of the Loan Agreement, we hereby instruct you
to Convert the following LIBOR Loan(s) outstanding under the Loan Agreement to Fixed Rate Loan(s)
as follows:

	 	1.	 	The proposed date of the Conversion (the “Conversion Date”) is                     ,
20___, which is a Business Day.
	 
	 	2.	 	The aggregate principal amount of the LIBOR Loan(s) to be Converted is
$                    .
	 
	 	3.	 	The Conversion is for the account of [ applicable Borrower ].
	 
	 	4.	 	The weighted average life of the Leases relating to the LIBOR Loan(s) to be
Converted, as of the date of the Conversion, is [                    ].

Ex. III-A-2

 

	 	5.	 	We confirm that the Applicable Margin with respect to the Converted Loan(s)
will be ___%.
	 
	 	6.	 	We confirm that all of the Collateral for the Loan(s) will continue to be
security for the Converted Loan(s).]

[Signature page follows.]

Ex. III-A-3

 

     The undersigned hereby certifies that [she/he] is an Authorized Person of the undersigned
Borrower or of the Designated Representative under the Loan Agreement and submits this Request for
Funding on behalf of that Borrower.

	 	 	 	 	 
	 	Borrowers:

[E-One, Inc. 

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	]
	 
	 
	 	[Elgin Sweeper Company

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	]
	 
	 
	 	[Vactor Manufacturing Inc. 

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	]
	 
	 
	 	[E-One New York, Inc. 

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	]
	 
	 
	 	[or

 	 
	 
	 	Designated Representative on behalf of 
[insert
applicable Borrower]:

Federal Signal Corporation

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	]

Ex. III-A-4

 

	 	 	 	 	 

Annex A

to Request for Funding of Advance

Schedule of Leases Included as Collateral

	 	 	 	 	 	 	 
	Lease Identification	 	 	 	 	 	NPV As Of Advance
	Number	 	Obligor	 	Borrower	 	Date
	 
	 	 	 	 	 	 

Ex. III-A-5

 

Exhibit III-B

Form of Request For Substitution

                    , 20___

	 	 	 
	To:

	 	Banc of America Leasing & Capital, LLC
	 

	 	231 S. LaSalle Street, 8th Floor
	 

	 	Chicago, IL 60604
	 
	 	 
	From:

	 	Federal Signal Corporation, as the Designated Representative
	 

	 	1415 West 22nd Street, 16th Floor
	 

	 	Oak Brook, IL 60523
	 
	 	 
	 

	 	[Use applicable Borrower, delete others]

	 
	 	 
	 

	 	E-One, Inc.
	 

	 	1415 West 22nd Street, Suite 1100
	 

	 	Oak Brook, IL 60523
	 
	 	 
	 

	 	Elgin Sweeper Company
	 

	 	1415 West 22nd Street, Suite 1100
	 

	 	Oak Brook, IL 60523
	 
	 	 
	 

	 	Vactor Manufacturing Inc.
	 

	 	1415 West 22nd Street, Suite 1100
	 

	 	Oak Brook, IL 60523
	 
	 	 
	 

	 	E-One New York, Inc.
	 

	 	1415 West 22nd Street, Suite 1100
	 

	 	Oak Brook, IL 60523
	 
	 	 
	Re:

	 	Request for Funding of Advance

Ladies and Gentlemen:

     We refer to that Amended and Restated Loan and Security Agreement dated as of December 20,
2007 (the “Loan Agreement”) among E-One, Inc, a Delaware corporation (“E-One”), Elgin Sweeper
Company, a Delaware corporation (“Elgin”), Vactor Manufacturing Inc., an Illinois corporation
(“Vactor”), E-One New York, Inc. (formerly known as Saulsbury Fire Rescue, Inc.), a New York
corporation (“EONY”; E-One, Elgin, Vactor, and EONY shall be collectively referred to herein as the
"Borrowers” and each individually as a “Borrower”), and you. Capitalized terms used herein and not
otherwise defined shall have the meanings ascribed thereto in the Loan Agreement.

Ex. III-B-1

 

     The undersigned Borrower or the Designated Representative has previously submitted to you its
Request for Approval of Leases and Terms with respect to each of the Leases to be removed as
Collateral as set forth on Annex A attached hereto (each a “Removed Lease”) and each of the Leases
to be included as Collateral as set forth on Annex B attached hereto (each a “Substituted Lease”).
The undersigned Borrower has received within the previous thirty (30) days’ Lender’s Approval of
Leases and Terms, a copy of which is attached hereto, with respect to the proposed Substitution and
each Substituted Lease.

     Pursuant to Section 5.2(c) of the Loan Agreement, the undersigned hereby irrevocably requests
the removal from the Collateral of each Removed Lease and addition to the Collateral of each of the
Substituted Leases. The effective date for the proposed Substitution is                     , 20___(the
"Substitution Date”), which date is a Cut-Off Date.

     The wire instructions for the Borrower is as follows:

	 	 	 	 	 	 	 
	 

	 	Bank:	 	 	 	 
	 

	 	Bank Address:
	 	 

	 	 
	 

	 	ABA #:
	 	 

	 	 
	 

	 	Account Name:
	 	 

	 	 
	 

	 	Account No.:
	 	 

	 	 
	 

	 	Reference:
	 	 

	 	 
	 

	 	 	 	 

	 	 

     The undersigned hereby certifies that (a) the information set forth in the Annexes hereto is
true and correct, (b) no material adverse change has occurred since the date of the Approval of
Leases and Terms attached hereto with respect to the undersigned Borrower or FSS or with respect to
any of the Obligors under any Substituted Lease, (c) all of the conditions set forth in Sections
5.2(b) and 6.2 of the Loan Agreement for the Substitution requested hereby have been and on the
Substitution Date will remain fully satisfied, (d) the Borrower executing and delivering this
request, and no other Borrowers have an interest in the Removed Leases and in the Substituted
Leases, and (e) [she/he] is an Authorized Person of the undersigned Borrower or of the Designated
Representative under the Loan Agreement entitled to request this Substitution on such Borrower’s
behalf.

	 	 	 	 	 
	 	Borrower:

[Use applicable Borrower and delete others]

[E-One, Inc. 

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

Ex. III-B-2

 

	 	 	 	 	 

	 	 	 	 	 
	 	[Elgin Sweeper Company

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	[Vactor Manufacturing Inc. 

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	[E-One New York, Inc. 

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	 	[or

Designated Representative on behalf of 
[insert
applicable Borrower]:

Federal Signal Corporation

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

Ex. III-B-3

 

	 	 	 	 	 

Annex A

to Request for Substitution

Schedule of Leases To Be Removed From Collateral By Substitution

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Lease	 	Estimated NPV
	 	 	 	 	 	 	 	 	Identification	 	As
Of Substitution
	Lessee	 	Borrower	 	Number	 	Date

Ex. III-B-4

 

Annex B

to Request for Substitution

Schedule of Leases To Be Included As Collateral By Substitution

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Lease	 	Estimated NPV
	 	 	 	 	 	 	 	 	Identification	 	As Of Substitution
	Lessee	 	Borrower	 	Number	 	Date

Ex. III-B-5

 

Exhibit IV

[Intentionally Omitted]

Ex. IV

 

Exhibit V

Form of Lock-Box Control Agreement

[See Attached]

Ex. V

 

Exhibit VI

Form of Amended and Restated Servicing and Title Agency Agreement

[See Attached]

Ex. VI

 

Exhibit VII

Lease Form(s)

[See Attached]

[Note that EONY uses the same lease forms as E-One.]

Ex. VII

 

Exhibit VIII

Form of Amended and Restated FSS Guaranty

[See Attached]

Ex. VIII

 

Exhibit IX

Form of Monthly Servicing Report

[See Attached]

Ex. IX

 

Schedule A-1

Documents To Be Delivered To The Lender

On Or Prior To The Closing Date

Documents to Be Delivered in Connection with this Agreement:

	1.	 	Fully completed and executed copies of each of the Transaction Documents.
	 
	2.	 	Copy of the Resolutions of the Board of Directors of each Company Party certified by its
Secretary authorizing such Person’s execution, delivery and performance of the Transaction
Documents and any other documents to be delivered by it thereunder.
	 
	3.	 	Articles or Certificate of Incorporation of each Company Party certified by the Secretary of
State of its jurisdiction of incorporation on or within thirty (30) days prior to the Closing
Date.
	 
	4.	 	Good Standing Certificate for each Company Party issued by the Secretaries of State of its
state of incorporation and each jurisdiction where it has material operations, each of which
is listed below:

	 	(a)	 	E-One: Delaware, Illinois, Florida, California, Louisiana
	 
	 	(b)	 	Elgin Sweeper Company: Illinois, Delaware, Louisiana, Alabama
	 
	 	(c)	 	Vactor Manufacturing Inc.: Illinois
	 
	 	(d)	 	E-One New York, Inc.: New York
	 
	 	(e)	 	FSS: Delaware, Illinois

	5.	 	A certificate of the Secretary of each Company Party certifying (i) the names and signatures
of the officers authorized on its behalf to execute each of the Transaction Documents and any
other documents to be delivered by it thereunder and (ii) a copy of such Person’s By-Laws.
	 
	6.	 	Pre-filing state and federal tax lien, judgment lien and UCC lien searches against each
Company Party from the following jurisdictions:

	 	(a)	 	E-One: Delaware
	 
	 	(b)	 	Elgin Sweeper Company: Delaware
	 
	 	(c)	 	Vactor Manufacturing Inc.: Illinois
	 
	 	(d)	 	E-One New York, Inc.: New York

Sched. A-1-1

 

	 	(e)	 	FSS: Delaware, Illinois

	7.	 	Authorized UCC-1 financing statements in proper form for filing under the UCC on or before
the date of the initial Advance in all jurisdictions as may be necessary or, in the opinion of
Lender, desirable, under the UCC of all appropriate jurisdictions or any comparable law in
order to perfect the security interests in the Collateral in favor of Lender, as contemplated
by the Agreement.
	 
	8.	 	Authorized UCC-3 termination statements, if any, in proper form for filing necessary to
release all security interests and other rights of any Person in the Collateral granted by any
Borrower.
	 
	9.	 	Favorable opinion(s) of legal counsel for the Company Parties, reasonably acceptable to
Lender which addresses the following matters and such other matters as Lender may reasonably
request:

	 	•	 	Each Company Party is a corporation duly incorporated, validly existing, and in
good standing under the laws of its state of incorporation.
	 
	 	•	 	Each Company Party has all requisite authority to conduct its business in each
jurisdiction where failure to be so qualified would have a material adverse effect on
such Person’s business.
	 
	 	•	 	The execution and delivery by each Company Party of this Agreement and by each
Company Party of each other Transaction Document to which it is a party and its
performance of its obligations thereunder have been duly authorized by all necessary
corporate or partnership action and proceedings on the part of such Person and will
not:

	 	(a)	 	require any action by or in respect of, or filing with, any
governmental body, agency or official (other than the filing of UCC financing
statements);
	 
	 	(b)	 	contravene, or constitute a default under, any provision of
applicable law or regulation or of its articles or certificate of incorporation
or bylaws, partnership agreement, or of any material agreement, judgment,
injunction, order, decree or other instrument binding upon such Person; or
	 
	 	(c)	 	result in the creation or imposition of any Adverse Claim on
assets of such Person or any of its Subsidiaries (except as contemplated by
this Agreement).

	 	•	 	This Agreement and each other Transaction Document to which any Company Party
is a party has been duly executed and delivered by such Person and constitutes the
legal, valid, and binding obligation of such Person, enforceable in accordance with its
terms, except to the extent the enforcement thereof may be

Sched. A-1-2

 

	 	 	 	limited by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors’ rights generally and subject also to the availability of equitable
remedies if equitable remedies are sought.
	 
	 	•	 	The provisions of the Agreement are effective to create a valid security
interest in favor of Lender in all Receivables and all other Collateral, and upon the
filing of financing statements, Lender shall acquire a perfected security interest in
such Receivables and other Collateral.
	 
	 	•	 	To the best of the opinion giver’s knowledge, there is no action, suit or other
proceeding against any Company Party that would materially adversely affect the
business or financial condition of such Person or that would materially adversely
affect the ability of such Person to perform its obligations under any Transaction
Document to which it is a party.

	10.	 	Executed copies of (i) all consents from and authorizations by any Persons and (ii) all
waivers and amendments to existing credit facilities or other material agreements that are
necessary in connection with entering into the Transaction Documents.

Sched. A-1-3

 

Schedule A-2

Documents To Be Delivered To The Lender

Within Sixty (60) Days After The Closing Date

The following documents shall be delivered to Lender by not later than February 18, 2008:

1. With respect to the Warrant ID #E-008027265-WOO2-5 (docket amount $2,128.97) (the “Warrant") for
outstanding taxes (the “Outstanding Taxes") due in the State of New York, evidence satisfactory to
Lender that EONY either (a) has paid the Outstanding Taxes and the Warrant has been satisfied or
(b) is contesting the Outstanding Taxes in good faith by appropriate proceedings which prevent
foreclosure or other realization upon any of the Collateral and preclude interference with the
operation of EONY’s business in the ordinary course, and EONY has established adequate reserves
therefore.

Lender and the Borrowers acknowledge and agree that, so long as the foregoing are timely delivered
to Lender, any representations, warranties or covenants in this Agreement or any other Transaction
Document that would be breached as a consequence of the Warrant or the Outstanding Taxes shall not
constitute a Default or Event of Default.

Sched. A-2-1

 

Schedule B

Legal Name; Jurisdiction of Organization;

Places of Business of the Company Parties;

Locations of Records;

Federal Employer Identification Number(s)

Legal Name and Jurisdiction of Organization:

	 	1.	 	Federal Signal Corporation, a Delaware corporation
	 
	 	2.	 	E-One, Inc., a Delaware corporation
	 
	 	3.	 	Elgin Sweeper Corporation, a Delaware corporation
	 
	 	4.	 	Vactor Manufacturing Inc., an Illinois corporation
	 
	 	5.	 	E-One New York, Inc., a New York corporation

Places of Business:

	 	1.	 	Federal Signal Corporation

1415 West 22nd Street, Suite 1100

Oak Brook, IL 60523
	 
	 		 	2645 Federal Signal Drive

University Park, IL 60466
	 
	 	2.	 	E-One, Inc.
1601 SW 37th Avenue

Ocala, FL 34474
	 
	 	3.	 	Elgin Sweeper Company
1300 W. Bartlett Road

Elgin, IL 60120
	 
	 	4.	 	Vactor Manufacturing Inc.
1621 S. Illinois Street

Streator, IL 61364
	 
	 	5.	 	E-One New York, Inc.

1601 SW 37th Avenue

Ocala, FL 34474

Sched. B-1

 

Locations of Records:

	 	1.	 	Federal Signal Corporation

1415 West 22nd Street, Suite 1100

Oak Brook, IL 60523
	 
	 	2.	 	E-One, Inc.

1415 West 22nd Street, Suite 1100

Oak Brook, IL 60523
	 
	 	3.	 	Elgin Sweeper Company

1415 West 22nd Street, Suite 1100

Oak Brook, IL 60523
	 
	 	4.	 	Vactor Manufacturing Inc.

1415 West 22nd Street, Suite 1100

Oak Brook, IL 60523
	 
	 	5.	 	E-One New York, Inc. 

1415 West 22nd Street, Suite 1100

Oak Brook, IL 60523

Federal Employer Identification Numbers:

	 	1.	 	Federal Signal Corporation

36-1063330
	 
	 	2.	 	E-One, Inc.

59-1515283
	 
	 	3.	 	Elgin Sweeper Company

36-2351764
	 
	 	4.	 	Vactor Manufacturing Inc. 

36-3961939
	 
	 	5.	 	E-One New York, Inc. 

16-0990705

Sched. B-2

 

Other Names

	 	1.	 	Federal Signal Corporation — None.
	 
	 	2.	 	E-One, Inc. — None.
	 
	 	3.	 	Elgin Sweeper Company — None.
	 
	 	4.	 	Vactor Manufacturing Inc. — None.
	 
	 	5.	 	E-One New York, Inc. — Saulsbury Fire Rescue, Inc., a New York
corporation (name changed to EONY 7/10/2003)

Sched. B-3

 

Schedule C

Information Re: Lock-Box Account

     Lock-Box Address; Lock-Box Account; Lock-Box Bank

     The Lock-Box address: Bank of America Lockbox Services, 13684 Collections Center Drive,
Chicago, IL 60693, lock-box no. 13684, all proceeds of which are deposited into the Lock-Box
Account in Lender’s name at Bank of America, N.A., bearing Account No. 2872457012, ABA No.
071000039.

Sched. C-1

 

Schedule D

Authorized Persons and Designated Representative

E-One, Inc.

	1.	 	Treasurer
	 
	2.	 	Director — Treasury Operations

Elgin Sweeper Company

	1.	 	Treasurer
	 
	2.	 	Director — Treasury Operations

Vactor Manufacturing Inc.

	1.	 	Treasurer
	 
	2.	 	Director — Treasury Operations

E-One New York, Inc.

	1.	 	Treasurer
	 
	2.	 	Director — Treasury Operations

Federal Signal Corporation:

	1.	 	Chief Financial Officer
	 
	2.	 	Vice President — Taxes
	 
	3.	 	Treasurer
	 
	4.	 	Director — Treasury Operations

Designated Representative:

Sched. D-1

 

Federal Signal Corporation:

	1.	 	Chief Financial Officer
	 
	2.	 	Vice President — Taxes
	 
	3.	 	Treasurer
	 
	4.	 	Director — Treasury Operations

Sched. D-2exv10wv

 

Exhibit 10V

RELEASE AND SEVERANCE AGREEMENT

This Release and Severance Agreement (the “Agreement”) will confirm the understanding of Federal
Signal Corporation and Robert D. Welding (with his heirs, beneficiaries, executors,
administrators, attorneys, successors and assigns, collectively referred to herein as “Employee”)
in connection with Employee’s retirement from employment and resignation from all directorships
and other positions with Federal Signal Corporation and any of its subsidiaries, benefit plans or
trusts associated with such benefit plans (collectively referred to herein as the “Company”). The
Company and Employee have reached agreement upon the following arrangements.

The effective date of Employee’s retirement from employment with the Company will be January 1,
2008 (the “Retirement Date”). As of the close of business on the Retirement Date, Employee retired
from and ceased his employment with the Company. In addition, as of the close of business on
December 11, 2007, Employee resigned from all of his officer, director or other positions (except
as an employee) with the Company. The Company agrees to treat such retirement as a termination by
the Company without “Cause” for purposes of the payment of cash severance benefits (the “Severance
Benefits”) under the Company’s Executive General Severance Plan dated November 2006 (the
“Severance Plan”).

As a termination by the Company without “Cause” under the Severance Plan, the Company agrees to pay
Employee the following Severance Benefits pursuant to such plan: (1) the sum of $1,270,395, which
is an amount equal to the sum of (i) the Employee’s current Base Salary for 2008 (i.e., $686,700),
and (ii) the Employee’s target annual bonus for 2008 (i.e., 85% of Base Salary, or $583,695); and
(2) the sum of $1,599, which is an amount equal to Employee’s unpaid prorated target annual bonus
for 2008, prorated by computing a fraction, the numerator of which is the number of days during
2008 through the Retirement Date that Employee was employed by the Company and the denominator of
which is 365; in each case, less any applicable taxes including federal, state or local employment
withholding taxes that are payable in connection with this amount. In accordance with IRS Code
provision 409A final regulations, this amount will be paid to Employee as follows: (y) a one-time
initial payment of $636,000 (less applicable withholding taxes), payable on July 2, 2008, and (z)
six monthly payments of $106,000 (less applicable withholding taxes) each on the Company’s last
regular payroll date of each month commencing in July 2008 and continuing through December 2008.

Employee understands that as a condition of receiving these Severance Benefits under the Severance
Plan, Employee is required to sign the general waiver and release in the form included in this
Agreement. No Severance Benefits will be paid to Employee until the release contained herein
becomes irrevocable in accordance with its terms. Employee further understands that any accrued
but unused vacation pay or other earned but unpaid wages due to Employee will be paid separately
with appropriate withholding taxes withheld and the receipt of such vacation pay or wages is in no
way contingent upon Employee signing this Agreement. Nothing herein shall change or have an effect
on any wages, pension, retirement or other employee benefits Employee may be entitled to under any
Company retirement or benefit program. Any monies owed the Company by Employee may be deducted
from the monies and the Severance Benefits, in accordance with applicable law. The Severance
Benefits shall not be considered or counted as “compensation” for purposes of any of the Company’s
welfare or pension benefit plans which provide benefits based, in any part, on compensation

As further Severance Benefits, the Company also agrees to continue any applicable welfare benefits
of medical insurance, dental insurance and group term life insurance that Employee receives for 18
months following the Retirement Date, at the same premium cost and the same coverage level as were
in effect for Employee as of the Retirement Date, pursuant to the terms of the Consolidated
Omnibus Budget Reconciliation Act of 1986 (COBRA). Employee must complete all necessary paperwork
within the prescribed time period in order to receive this benefit. Employee shall make monthly
COBRA premium

 

 

payments in advance and shall send them to the Federal Signal Corporation office in Oak Brook,
Illinois. If Employee fails to make such COBRA payments, Employee’s COBRA coverage will be
cancelled. However, during the eighteen (18) months the Company continues the welfare benefits, in
the event the premium cost and/or level of coverage shall change for all employees of the Company,
the cost and/or coverage level, likewise, shall change in a corresponding manner for Employee. In
addition, these welfare benefits shall be discontinued prior to the end of the period described
above if Employee becomes covered under another group health plan, Employee becomes entitled to
Medicare benefits (under Part A, Part B, or both), or the Company ceases to provide any group
health plan for its employees. Continuation may also be terminated for any reason that the terms
of the plan providing such coverage would terminate coverage of a participant or an eligible
dependent.

The Company makes this Agreement to avoid the cost of defending any possible lawsuit. Employee
acknowledges that by making this Agreement the Company does not admit that it has done anything
wrong. Because this Agreement contains a release of claims under the Age Discrimination in
Employment Act (ADEA), Employee understands that he has a period of twenty-one (21) days to review
and consider this Agreement before signing it. He may use as much of this 21-day period as he
wishes in making his decision. Employee further acknowledges that he may revoke the signed
Agreement within seven (7) days after its signing. Any such revocation must be in writing and
received by the Company’s General Counsel in the legal department at the principal offices of
Federal Signal Corporation in Oak Brook, Illinois within the seven (7) day period. Payment of the
Severance Benefits described above will only begin after this Agreement becomes binding which
takes place when the revocation period runs out seven days (7) after the date of Employee’s
signature.

Employee is strongly encouraged to consult with an attorney before signing this Agreement;
however, whether he does so or not is his decision. Employee acknowledges that he has been advised
that he should be represented by an attorney throughout the negotiation of the terms of this
Agreement.

     (1) General Release. Employee hereby waives, releases and forever discharges the
Company and its subsidiaries, divisions and affiliates, whether direct or indirect, its and their
joint ventures and joint venturers (including its and their respective directors, officers,
employees, shareholders, partners and agents, past, present and future), and each of its and their
respective successors and assigns (hereinafter collectively referred to as “Releasees”), from any
and all known or unknown actions, causes of action, claims or liabilities of any kind which have
been or could be asserted against the Releasees arising out of or related to Employee’s employment
with and/or retirement from his employment with the Company and/or any of the other Releasees
and/or any other occurrence up to and including the date of this Agreement, including but not
limited to:

	 	(a)	 	claims, actions, causes of action or liabilities arising under
Title VII of the Civil Rights Act, as amended, the Civil Rights Act of 1871, the Civil Rights Act of
1991, the ADEA, the COBRA, the Employee Retirement Income Security Act,
as amended, the Rehabilitation Act, as amended, the Americans with
Disabilities Act, the Family and Medical Leave Act (to the extent permitted by law), the
Vietnam Era Veterans Readjustment Assistance Act, the Sarbanes-Oxley Act of
2002 and/or any other federal, state, municipal or local
employment discrimination statutes (including, but not limited to, claims based on age,
sex, attainment of benefit plan rights, race, religion, national origin, marital
status, sexual orientation, ancestry, harassment, parental status, handicap,
disability, retaliation and veteran status); and/or
	 
	 	(b)	 	claims, actions, causes of action or liabilities arising under
any other federal, state, municipal or local statute, law, ordinance or regulation; and/or

2

 

	 	(c)	 	any other claim whatsoever including, but not limited to, claims for
severance pay under any voluntary or involuntary severance/separation plan,
policy or program maintained by the Releasees, claims for attorney’s fees,
claims based upon breach of contract, wrongful termination, defamation,
intentional infliction of emotional distress, tort, personal injury,
invasion of privacy, violation of public policy, negligence and/or any other
common law, statutory or other claim whatsoever arising out of or relating
to Employee’s employment with and/or retirement from employment with the
Company and/or any of the other Releasees;

but excluding claims which Employee may make under state workers’ compensation or unemployment
laws, and/or any claims which by law Employee cannot waive. Specifically excluded from this
General Release is Employee’s right to file a charge with an administrative agency or participate
in any agency investigation. Employee is, however, waiving his right to recover money in
connection with such a charge or investigation. Employee is also waiving his right to recover
money in connection with a charge filed by any other individual or by the Equal Employment
Opportunity Commission or any other federal or state agency.

     (2) Covenant Not To Sue. In addition to and apart from the General Release contained
in paragraph (1) above, Employee also agrees never to sue any of the Releasees or become a party
to a lawsuit on the basis of any claim of any type whatsoever arising on or prior to the date of
this Agreement out of or related to Employee’s employment with and/or retirement from employment with the
Company and/or any of the other Releasees, other than a lawsuit to challenge this Agreement under the
ADEA or for indemnification as set forth in paragraph 8 of this Agreement.

     (3) Further Release And Acknowledgment. To the extent permitted by law, Employee
further waives his right to any monetary recovery should any federal, state or local
administrative agency pursue any claims on Employee’s behalf arising out of or related to his employment with and/or
retirement from employment with the Company and/or any of the other Releasees. Employee also
acknowledges that he has not suffered any on-the-job injury for which he has not already filed
a claim. Employee acknowledges and agrees that the Company’s provision of the Severance Benefits to
Employee and his signing of the Agreement does not in any way indicate that Employee has any viable
claims against the Company or that the Company has or admits any liability to Employee whatsoever.

     (4) Reemployment/Consulting Arrangement.. To the extent permitted by law, Employee
further waives, releases and discharges Releasees from any reinstatement rights which Employee
has or could have. Employee further acknowledges and agrees that he will not seek employment with
the Company and/or any other of the Releasees following the Retirement Date.

     (5) Non-Disparagement, Confidentiality, Cooperation, Non-Competition and Non-Solicitation. Employee agrees that he shall not at any time or in any way disparage,
or take any actions or make any statements that reflect negatively on, the Company and/or any of the other Releasees
to any person, corporation, entity or other third party whatsoever. Also, the Company and/or any of
the other Releasees promise, individually and in the aggregate, that they shall not at any time
disparage, or take any actions or make any statements that reflect negatively on, Employee to any person,
corporation, entity or other third party whatsoever.

     Employee agrees from and after the Retirement Date to keep strictly confidential the
existence and terms of this Agreement, and Employee further agree that he will not disclose them
to any person or entity, other than to his immediate family, his attorney and his financial
advisor, or except as may be required by law.

3

 

     Employee acknowledges that after his Retirement Date he shall not represent himself to be an
employee of the Company. After December 11, 2007, he shall not represent himself to be an officer
or director of the Company nor take any action which may bind the Company with regard to any
customer, supplier, vendor or any other party with whom Employee has had contact while performing
his duties as an employee, officer or director of the Company.

     Employee further agrees that for a period of one (1) year following the Retirement Date,
Employee will not, without the prior written consent of the Company, engage directly or indirectly
(as an employee, consultant, independent contractor, officer, director or in any other capacity)
in any business or enterprise which is in competition with the Company or its successors or
assigns. A business or enterprise will be deemed to be in competition if it is engaged in any
significant business activity of the Company or its subsidiaries any place in the world that the
Company is currently conducting its business or selling its products. For a one (1) year period
following the Retirement Date, Employee further agrees that he will not, directly or indirectly,
hire away or participate or assist in the hiring away of any person employed by the Company or its
affiliates on the Retirement Date and Employee will not solicit nor encourage any person employed
by the Company or its affiliates on or after the Retirement Date to leave the employ of the
Company or its affiliates.

     Employee further agrees from and after today to make himself available to the Company and its
legal counsel to provide reasonable cooperation and assistance to the Company with respect to
areas and matters in which Employee was involved during his employment, including any threatened
or actual investigation, regulatory matter and/or litigation concerning the Company, and to
provide to the Company, if requested, information and counsel relating to ongoing matters of
interest to the Company. To the extent that the Company requests such cooperation and assistance
of Employee, the Company will compensate Employee at the rate of $250 per hour for the time spent
by Employee in rendering such cooperation and assistance. The Company will take into consideration
Employee’s personal and business commitments, will give Employee as much advance notice as
reasonably possible, and ask that Employee be available at such time or times as are reasonably
convenient to Employee and the Company. The Company also agrees to reimburse Employee for the
actual out-of-pocket expenses Employee incurs as a result of his complying with this provision.
Any payments of consulting fees or expenses to be made by the Company to Employee pursuant to this
provision are subject to Employee’s submission to the Company of documentation substantiating such
time and/or expenses as the Company may require and consistent with the documentation necessary
and required for reimbursement of business expenses by the Company.

     Proprietary information, confidential business information and trade secrets (hereinafter
collectively “Confidential Information”) which became known to Employee as an employee or director
of the Company remain the property of the Company. Such Confidential Information includes, but is
not limited to, materials, records, books, products, business plans, business proposals, software,
personnel information and data of the Company and its affiliates and its customers, but excludes
information which is generally known to the public or becomes known except through Employee’s
actions. Employee agrees from and after the Retirement Date that he will not at any time, directly
or indirectly, disclose Confidential Information to any third party or otherwise use such
Confidential Information for his own benefit or the benefit of others. Also, Employee acknowledges
that he remains bound by the terms and conditions of the applicable provisions of the Company’s
Code of Business Conduct.

     (6) Consequences of Breach of Covenant Not To Sue, Breach of Covenant Not To Seek
Reinstatement or Reemployment or Breach of Non-Disparagement, Confidentiality, Cooperation,
Non-Competition and Non-Solicitation Provisions. Employee acknowledges that the provisions of
paragraph (5) are reasonable and not unduly restrictive of Employee’s rights as an individual and
Employee warrants that as of the date Employee signs this Agreement Employee has not breached any
of the

4

 

provisions of paragraph (5). Employee further acknowledges that in the event that Employee breaches
any of the provisions of paragraph (5), such breach will result in immediate and irreparable harm
to the business and goodwill of the Company and that damages, if any, and remedies at law for such
breach would be inadequate. The Company shall, therefore, be entitled to apply without bond to any
court of competent jurisdiction for an injunction to restrain any violation of paragraph (5) by
Employee and for such further relief as the court may deem just and proper. In addition, the
Company shall not be obligated to continue the availability or payment of Severance Benefits to
Employee. The Company and Employee agree to the extent of a breach of any of the provisions in
paragraph (5) above, as adjudicated by a court of competent jurisdiction or an award of the
arbitrator in accordance with paragraph (14) below, the breaching party shall be obligated to pay
to the non-breaching party its costs and expenses, including reasonable legal fees and
disbursements incurred by the non-breaching party to enforce its rights under paragraph (5) above.

     Notwithstanding the foregoing, the Company’s determination that Employee breached the
provisions of paragraphs (2), (4) or (5) above shall be communicated to Employee, by written
Notice of Breach, at least six (6) business days prior to the date the Company suspends the
payment of Severance Benefits under this paragraph (6). The written Notice of Breach shall
indicate the specific provision(s) of paragraphs (2), (4) or (5) claimed to be breached and shall
set forth in reasonable detail the facts and circumstances claimed to provide a basis for
determination that a breach has occurred.

     (7) Company Property/Expenses. Employee agrees to promptly return to the Company (as
soon as practicable following the Retirement Date) all Company property, including, but not
limited to,
Company car, cell phone, information technology equipment, documents and records and other
physical
or personal property of the Company in Employee’s possession or control, and agrees not to
keep, transfer
or use copies or excerpts of the foregoing items. Notwithstanding the immediately preceding
sentence,
the Company has agreed that Employee may retain and own the laptop computer and Blackberry
voice
and data communication device issued to him by the Company. Employee specifically acknowledges
that
the Company will not be responsible for any third party fees or charges associated with
Employee’s use
of such laptop or Blackberry communication device after the Retirement Date. Employee agrees
that all
business expenses for which Employee is entitled to reimbursement are documented and submitted
for
approval on a timely basis and any final expenses are submitted within ten (10) days after the
Retirement
Date.

     (8) Reservation of Rights to Indemnification and Director and Officer Liability
Insurance for Actions Taken or Omitted while Director or Executive Officer. Employee’s right to
indemnification to
the fullest extent permitted by Delaware General Corporation Law and the Company’s Certificate
of
Incorporation and By-Laws for expenses (including attorney’s fees and disbursements),
judgments, fines
and amounts paid in settlement, actually and reasonably incurred by Employee in connection
with any
proceeding arising by reason of acts taken or omissions to act occurring while Employee was an
executive
officer or director of the Company or any of its subsidiaries, shall continue unabridged after
the
Retirement Date. In addition, Employee shall be entitled to make claim under any director and
officer
liability insurance coverage that the Company may have available for actions or omissions to
act by
Employee while Employee was an executive officer or director of the Company or any of its
subsidiaries.

     (9) Time to Consider Agreement. Employee acknowledges that he has been given at
least
twenty-one (21) days to consider this Agreement thoroughly and Employee was encouraged to
consult
with his personal attorney at his own expense, if desired, before signing below, Employee
further agrees
that any changes made to this Agreement will not restart the running of the 21-day period
referenced herein.

5

 

     (10) Time to Revoke Agreement. Employee understands that he may revoke this Agreement
within seven (7) days after its signing and that any revocation must be made in writing and
submitted
within such seven (7) day period to the General Counsel,, Federal Signal Corporation, 1415
West 22nd
Avenue, Suite 1100, Oak Brook, IL 60523. Employee further understands that if he revokes
this
Agreement, he shall not receive the Severance Benefits.

     (11) Consideration. Employee also understands that the Severance Benefits which he
will
receive in exchange for signing and not later revoking this Agreement are in addition to
anything of value
to which Employee is already entitled, including treatment of Employee’s outstanding equity or
other
stock-based awards granted under the Company’s various equity incentive compensation after the
Retirement Date in the manner set forth in the particular plan or award agreement for
retirement from
employment with the Company. In addition, Employee will be entitled to an cash incentive
bonus for
2007 of at least $466,957, or 80% of his target bonus for 2007 of $583,696.

     (12) RELEASE INCLUDES UNKNOWN CLAIMS. EMPLOYEE FURTHER
UNDERSTANDS THAT THIS AGREEMENT INCLUDES A RELEASE OF ALL KNOWN AND
UNKNOWN CLAIMS ARISING ON OR PRIOR TO THE DATE OF THIS AGREEMENT EXCEPT
FOR CLAIMS FOR INDEMNIFICATION UNDER PARAGRAPH (8) OF THIS AGREEMENT.
NOTHING CONTAINED HEREIN SHALL BE CONSTRUED AS A WAIVER, RELEASE, BAR TO,
AND/OR PROHIBITION AGAINST ANY CLAIM BY EMPLOYEE TO ENFORCE THE TERMS OF
THIS AGREEMENT.

     (13) Severability. Employee acknowledges and agrees that if any provision of this
Agreement
is found, held or deemed by a court of competent jurisdiction to be void, unlawful or
unenforceable under
any applicable statute or controlling law, the remainder of this Agreement shall continue in
full force and effect.

     (14) Governing Law. This Agreement is deemed made and entered into in the State of
Illinois, and in all respects shall be interpreted, enforced and governed under applicable
federal law and in
the event reference shall be made to State law the internal laws of the State of Delaware
shall apply,
without reference to its conflict of law provisions. Any dispute under this Agreement shall be
adjudicated
by a court of competent jurisdiction in the State of Illinois. Notwithstanding the foregoing,
in accordance
with Article 6.2 of the Severance Plan, the parties shall have the right and option (in lieu
of litigation) to
have any dispute or controversy arising under or in connection with the Severance Plan settled
by
arbitration, subject to the limitations set forth in Article 6.2.

     (15) Knowing And Voluntary Waiver and Release. Employee further acknowledges and
agrees that he has carefully read and fully understand all of the provisions of this Agreement
and that he
voluntarily entered into this Agreement by signing below. Employee acknowledges that he was
advised
and encouraged by the Company to consult with an attorney of Employee’s choice at Employee’s
own
expense prior to signing this Agreement.

     (16) General Matters. Employee acknowledges and agrees that in signing this Agreement
he
does not rely and has not relied on any representation or statement by the Company or by its
employees,
agents, representatives, or attorneys with regard to the subject matter, basis or effect of
this Agreement.

     The language of all parts of this Agreement shall be construed according to its fair meaning,
and not strictly for or against either party. The provisions of this Agreement shall survive any
termination of this Agreement when necessary to effect the intent and terms of this Agreement
expressed herein.

6

 

     No modification of any provision of this Agreement shall be effective unless made in writing
and signed by Employee and a duly authorized senior executive of the Company. This Agreement shall
not be assignable by Employee.

	 	 	 	 	 
	 	 	 
	 	/s/ Robert D. Welding 	 
	 	Robert D. Welding 	 
	 
	 	1/21/2008	 
	 	(Date)	 
	 	 	 	 	 
	 	FEDERAL SIGNAL CORPORATION

 	 
	 	By:  	/s/ Jennifer L. Sherman
 	 
	 	 	Name:  	Jennifer L. Sherman	 
	 	 	Title:  	 	 
	 
	 	21 Jan 2008	 
	 	(Date)	 

7

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