Document:

Exhibit 4.05

 

CUSIP NO. 5252M0CW5

ISIN NO. US5252M0CW51

 

	
  REGISTERED

  	
   

  	
  FACE AMOUNT: $9,000,000

  

No. R-1

 

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTE, SERIES I

(FIXED RATE)

 

If the registered owner of this
Note (as indicated below) is The Depository Trust Company (the “Depository”) or
a nominee of the Depository, this Note is a Note in global form (a “Global
Security”) and the following legends are applicable except as specified on the
reverse hereof:

 

THIS NOTE IS A GLOBAL SECURITY
WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED
IN THE NAME OF THE DEPOSITORY OR A NOMINEE OF THE DEPOSITORY.  UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE COMPANY (AS
DEFINED BELOW) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.

 

UNLESS AND UNTIL IT IS
EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED FORM, THIS GLOBAL
SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TO A
NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY
OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH NOMINEE
TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY.

 

 

ISSUE
PRICE:  $9,000,000

ISSUE
DATE: February 1, 2008

MATURITY
DATE: February 1, 2038, subject to Issuer’s Call Option and/or Survivor’s
Option

INTEREST
RATE: 7.00%    

SPREAD:
N/A

SPREAD
MULTIPLIER: N/A

MAXIMUM
INTEREST RATE: N/A

MINIMUM
INTEREST RATE: N/A

INTEREST
PAYMENT DATES: Semi-annually on February 1 and August 1, commencing on August
1, 2008

REGULAR
RECORD DATES: Fifteen calendar days immediately preceding the interest payment
date.

EXCHANGE
RATE AGENT: N/A

DEPOSITORY:
The Depository Trust Company

DUAL
CURRENCY NOTE:

o YES   
x NO

OPTION
ELECTION DATES: N/A

OPTIONAL
PAYMENT CURRENCY: N/A

DESIGNATED
EXCHANGE RATE: N/A

OPTION
VALUE CALCULATION AGENT: N/A

OPTION
TO RECEIVE PAYMENTS IN THE SPECIFIED CURRENCY:

o YES   
x NO 

SPECIFIED
CURRENCY: N/A

BUSINESS
DAY: New York

AMORTIZING
NOTE:

o YES   
x NO

SINKING
FUND: N/A

OID
NOTE:

o YES   
x NO

AUTHORIZED
DENOMINATIONS: $1,000/$1,000

EXTENSION
OF MATURITY NOTE:

o YES   
x NO

EXTENSION
PERIOD: N/A

NUMBER
OF EXTENSION PERIODS: N/A

OPTION
TO ELECT REPAYMENT:

o YES   
x NO

OPTIONAL
REPAYMENT DATES: N/A

SURVIVOR’S
OPTION: 

x YES  o NO

OPTIONAL
REPAYMENT PRICES: N/A

OPTIONAL
INTEREST RATE RESET:

o YES   
x NO

OPTIONAL
RESET DATES: N/A

OPTIONAL
REDEMPTION:

x YES   
o NO

INITIAL
REDEMPTION DATE: On each Interest Payment Date Commencing on February 1, 2012

INITIAL
REDEMPTION 

PERCENTAGE:  N/A

APPLICABILITY
OF ANNUAL REDEMPTION

PERCENTAGE REDUCTION:

o YES   
x NO

If yes, state Annual Percentage

Reduction:     %

EXTENDIBLE
NOTE:

o YES   
x NO

INITIAL
MATURITY DATE: N/A

SPECIAL
ELECTION INTERVAL: N/A

RENEWABLE
IN PART:

o YES   
x NO

AUTHORIZED
RENEWABLE AMOUNTS: N/A

SPECIAL ELECTION PERIOD: N/A

 

OTHER PROVISIONS: N/A

 

LEHMAN BROTHERS HOLDINGS INC.,
a corporation duly organized and existing under the laws of the State of
Delaware (herein called the “Company”, which term includes any successor
corporation under the Indenture referred to on the reverse hereof), for value
received, hereby promises to pay to Cede & Co., or registered assigns,
on the Maturity Date the Principal Amount hereof (as defined below) and, if so
specified above, to pay interest thereon from the Issue Date specified above or
from the most recent Interest Payment Date specified above to which interest
has been paid or duly provided for at the Interest Rate specified above until
the principal hereof is paid or made available for payment and (to the extent
that the payment of such interest shall be legally enforceable) at such rate
per annum on any overdue principal and premium and on any overdue installment
of interest.  Unless otherwise specified
above, and except as provided in Section 8 on the reverse hereof if this
Note is a Dual Currency Note (as hereinafter defined), payments of principal,
premium, if any, and interest hereon will be made in U.S. dollars; if the
Specified Currency set forth above is a currency other than U.S. dollars (a “Foreign
Currency”), such payments will be made in U.S. dollars based on the equivalent
of that Foreign Currency converted into U.S. dollars in the manner set forth in
Section 2 on the reverse hereof.  If
the Specified Currency is a Foreign Currency and it is so provided above, the
Holder may elect to receive such payments in that Foreign Currency by delivery
of a written request to the Trustee (or to any duly appointed Paying Agent) at
the Corporate Trust Office (as defined below) not later than 10 calendar days
prior to the applicable payment date, and such election will remain in effect
for the Holder until revoked by written notice to the Trustee (or to any such
Paying Agent) at the Corporate Trust Office received not later than 10 calendar
days prior to the applicable payment date; provided,
however, no such election or
revocation may be made if, with respect to this Note, (i) an Event of
Default has occurred, (ii) the Company has exercised any discharge or
defeasance options or (iii) the Company has given a notice of
redemption.  In the event the Holder
makes any such election pursuant to the preceding sentence, such election will
not be effective on any transferee of such Holder and such transferee shall be
paid in U.S. dollars unless such transferee makes an election pursuant to the
preceding sentence; provided, however, that such election, if in effect
while funds are on deposit with the Trustee to satisfy and discharge this Note,
will be effective on any such transferee unless otherwise specified above.  The “Principal Amount” of this Note at any
time means (i) if this Note is an OID Note, the Amortized Face Amount at
such time as described in Section 7 on the reverse hereof, (ii) if
this Note is an Amortizing Note, the Outstanding

 

2

 

Face Amount at such time as
described in Section 4 on the reverse hereof, (iii) in all other
cases, the Face Amount hereof.

 

If this Note is subject to an
Annual Percentage Reduction as specified above, the Redemption Price shall
initially be the Initial Redemption Percentage of the Principal Amount of this
Note on the Initial Redemption Date and shall decline at each anniversary of
the Initial Redemption Date (each such date, a “Redemption Date”) by the Annual
Percentage Reduction of such Principal Amount until the Redemption Price is
100% of such Principal Amount.

 

In the event of any optional
redemption by the Company, any repayment at the option of the Holder,
acceleration of the maturity of this Note or other prepayment of this Note
prior to the Maturity Date specified, the term “Maturity” when used herein
shall refer, where applicable, to the date of redemption, repayment,
acceleration or other prepayment of this Note.

 

Except as provided in the
following paragraph, the Company will pay interest semiannually on February 1
and August 1 of each year (unless other Interest Payment Dates are
specified above) (each an “Interest Payment Date”), commencing with the first
Interest Payment Date next succeeding the Issue Date, and at Maturity; provided that any payment of principal,
premium, if any, or interest to be made on any Interest Payment Date or on a
date of Maturity that is not a Business Day shall be made on the next
succeeding Business Day with the same force and effect as if made on such
Interest Payment Date or such date of Maturity, as the case may be, and no
additional interest shall accrue as a result of such delayed payment.  The term “Business Day” means any day, that
is not a Saturday or Sunday, and that is not a day on which banking
institutions in New York City are generally authorized obligated or by law or
executive order to be closed; for notes denominated in pounds sterling
only, is also a London Business Day; for notes having a specified currency
other than U.S. dollars only, other than notes denominated in Euros, is also
not a day on which banking institutions in the principal financial center (as
defined below) of the country of the specified currency generally are
authorized or obligated by law or executive order to close; and for  notes denominated in Euros, is also a Euro business
day. A principal financial center means the capital city of the country issuing
the specified currency. However, for U.S. dollars, Australian dollars, Canadian
dollars and Swiss francs, the principal financial center will be New York City,
Sydney, Toronto and Zurich, respectively. A ‘‘London Business Day’’ means any
day that is not a Saturday or Sunday and on which dealings in deposits in U.S.
dollars are transacted, or with respect to any future date are expected to be
transacted, in the London interbank market and a ‘‘Euro Business Day’’ means
any day that is not a Saturday or Sunday on which the Trans-European Automated
Real-Time Gross Settlement Express Transfer System is open.  Each payment of interest hereon shall
include interest accrued through the day before the Interest Payment Date or
date of Maturity, as the case may be. 
Unless otherwise specified above, interest on this Note will be computed
on the basis of a 360-day year of twelve 30-day months.  In no event shall the interest rate of this
Note be higher than the maximum rate permitted by applicable law, as the same
may be modified by United States law of general application.

 

Unless otherwise specified
above, the interest payable on any Interest Payment Date will, as provided in
the Indenture, be paid to the person in whose name this Note (or one or more
predecessor Notes) is registered at the close of business on the Regular Record
Date indicated above (whether or not a Business Day) next preceding such
Interest Payment Date; provided
that, notwithstanding any provision of the Indenture to the contrary, interest
payable on any date of Maturity shall be payable to the Person to whom
principal shall be payable; and provided,
further, that, unless otherwise
specified above, in the case of a Note initially issued between a Regular Record
Date and the Interest Payment Date relating to such Regular Record Date,
interest for the period beginning on the Issue Date and ending on such Interest
Payment Date shall be paid on the Interest Payment Date following the next
succeeding Regular Record Date to the registered Holder on such next succeeding
Regular Record Date.

 

Unless otherwise indicated
above, and except as provided below, if this Note is a Global Security, all
payments of interest on this Note and all principal payments hereon if this
Note is an Amortizing Note (other than interest and, in the case of Amortizing
Notes, principal payable at Maturity) will be made by check (unless otherwise
provided above, from an account at a bank located outside the United States if
such amount is payable in a Foreign Currency); provided
that, if the Holder hereof is the Holder of U.S.$10,000,000 or more in
aggregate Principal Amount of Notes of this series of like tenor and term (or a
Holder of the equivalent thereof in a Foreign Currency determined as provided
in Section 2 on the reverse hereof), such Holder shall be entitled to
receive interest payments (and principal payments, if this Note is an
Amortizing Note) in immediately available funds, but only if

 

3

 

complete and appropriate
instructions have been received in writing by the Trustee (or any such Paying
Agent) on or prior to the applicable Regular Record Date.  Simultaneously with any election by the
Holder hereof to receive payments in respect hereof in a Foreign Currency, such
Holder may, if so entitled (as provided above), elect to receive such payments
in immediately available funds by providing complete and appropriate
instructions to the Trustee (or any such Paying Agent), and all such payments
will be made in immediately available funds to an account maintained by the
payee with a bank located outside the United States or as otherwise provided
above.

 

Unless otherwise indicated
above, and except as provided below if this Note is a Global Security, payments
of principal, premium, if any, and interest payable at Maturity will be made in
immediately available funds (unless otherwise indicated above, payable to an
account at a bank located outside the United States if payable in a Foreign Currency)
upon surrender of this Note at the corporate trust office or agency of the
Trustee (or any duly appointed Paying Agent) maintained for that purpose in the
Borough of Manhattan, New York City (the “Corporate Trust Office”), provided that this Note is presented to
the Trustee (or any such Paying Agent) in time for the Trustee (or any such
Paying Agent) to make such payments in such funds in accordance with its normal
procedures.

 

Unless otherwise specified
above, if this Note is a Global Security, payments of interest hereon and
principal hereon if this Note is an Amortizing Note (in each case, other than
at Maturity), will be made in same-day funds in accordance with existing
arrangements between the Trustee (or any duly appointed Paying Agent) and the Depository.  Unless otherwise specified above, if this
Note is a Global Security, any principal, premium and/or interest payable
hereon at Maturity will be paid by wire transfer in immediately available funds
to an account specified by the Depository (which account, unless otherwise
provided above, will be at a bank located outside the United States if payable
in a Foreign Currency).

 

The Company will pay any
administrative costs imposed by banks in making payments in immediately
available funds, but any tax, assessment or governmental charge imposed upon
payments hereunder, including, without limitation, any withholding tax, will be
borne by the Holder hereof.

 

References herein to “U.S.
dollars” or “U.S.$” or “$” are to the coin or currency of the United States as
at the time of payment is legal tender for the payment of public and private
debts.

 

Reference
is hereby made to the further provisions of this Note set forth on the reverse
hereof.  Such further provisions shall
for all purposes have the same effect as if set forth at this place.

 

This Note shall not be valid or
become obligatory for any purpose until the certificate of authentication
hereon shall have been signed by the Trustee under the Indenture.

 

4

 

IN WITNESS WHEREOF, Lehman
Brothers Holdings Inc. has caused this instrument to be signed by its Chairman
of the Board, its President, its Chief Financial Officer, one of its Vice
Presidents or its Treasurer, by manual or facsimile signature under its corporate
seal, attested by its Secretary or one of its Assistant Secretaries by manual
or facsimile signature.

 

Dated: February 1, 2008

 

	
  [SEAL]

  	
   

  	
   

  	
  LEHMAN
  BROTHERS HOLDINGS INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name: Andrew Yeung

  	
   

  
	
   

  	
   

  	
   

  	
  Title:   Vice President

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attest:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name: Cindy Buckholz

  	
   

  
	
   

  	
   

  	
  Title:   Assistant Secretary

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

TRUSTEE’S CERTIFICATE OF
AUTHENTICATION

 

This is one of the Securities
of the series designated herein referred to in the within-mentioned Indenture.

 

CITIBANK, N.A.
   as Trustee

 

 

	
  By:

  	
   

  	
   

  	
   

  
	
  Authorized Officer

  	
   

  	
   

  
					

 

 

5

 

[REVERSE OF NOTE]

 

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTES, SERIES I

(Fixed Rate)

 

Section 1.  General.  This Note is one of a duly authorized series
of Notes of the Company designated as the Medium-Term Notes, Series I (Fixed
Rate) of the Company (herein called the “Notes”).  The Notes are one of an indefinite number of
series of debt securities of the Company (collectively, the “Securities”)
issued or issuable under and pursuant to an indenture dated as of September 1,
1987, as amended and supplemented (the “Indenture”), duly executed and
delivered by the Company and Citibank, N.A., as Trustee (herein called the
“Trustee”), to which Indenture and all indentures supplemental thereto
reference is hereby made for a description of the rights, limitations of
rights, obligations, duties and immunities thereunder of the Trustee, the
Company and the holders of the Securities. 
The separate series of Securities may be issued in various aggregate
principal amounts, may mature at different times, may bear interest (if any) at
different rates, may be subject to different redemption provisions or repayment
or repurchase rights (if any), may be subject to different sinking, purchase or
analogous funds (if any), may be subject to different covenants and Events of
Default and may otherwise vary as in the Indenture provided.

 

Section
2.  Currency Exchanges and Payments.  If the Holder elects to receive all or a
portion of payments of principal of, premium, if any, and interest on this
Note, if denominated in a Foreign Currency, in U.S. dollars, the Exchange Rate
Agent specified on the face hereof or a successor thereto (the “Exchange Rate
Agent”) will convert such payments into U.S. dollars. In the event of such an
election, payment to the Holder will be based upon the exchange rate as
determined by the Exchange Rate Agent based on the highest bid quotation in New
York City received by such Exchange Rate Agent at approximately 11:00 a.m., New
York City time, on the second Business Day preceding the applicable payment
date from three recognized foreign exchange dealers (one of which may be the
Exchange Rate Agent unless such Exchange Rate Agent is an affiliate of the
Company) for the purchase by the quoting dealer of the Foreign Currency for
U.S. dollars for settlement on such payment date in the amount of the Foreign
Currency payable in the absence of such an election to such Holder and at which
the applicable dealer commits to execute a contract. If such bid quotations are
not available, such payment will be made in the Foreign Currency. All currency
exchange costs will be borne by the holder of this Note by deductions from such
payments.

 

Unless otherwise specified on
the face hereof, if payment hereon is required to be made in a Foreign Currency
and such currency is unavailable to the Company for making payments thereof due
to the imposition of exchange controls or other circumstances beyond the
Company’s control, or is no longer used by the government of the country which
issued such currency or for the settlement of transactions by public
institutions of or within the international banking community, then the Company
will be entitled to make payments with respect hereto in U.S. dollars until
such Foreign Currency is again available or so used.  The amount so payable on any date in such
Foreign Currency shall be converted into U.S. dollars at a rate determined by
the Exchange Rate Agent on the basis of the noon buying rate in New York City
for cable transfers in the Foreign Currency as certified for customs purposes
by the Federal Reserve Bank of New York (the “Market Exchange Rate”) for such
Foreign Currency on the second Business Day prior to such payment date, or on
such other basis as may be specified on the face hereof.  In the event such Market Exchange Rate is not
then available, the Company will be entitled to make payments in U.S. dollars (i) if
such Foreign Currency is not a composite currency, on the basis of the most
recently available Market Exchange Rate for such Foreign Currency or (ii) if
such Foreign Currency is a composite currency in an amount determined by the
Exchange Rate Agent to be the sum of the results obtained by multiplying the
number of units of each component currency of such composite currency, as of
the most recent date on which such composite currency was used, by the Market
Exchange Rate for such component currency on the second Business Day prior to
such payment date (or if such Market Exchange Rate is not then available, by
the most recently available Market Exchange Rate for such component currency,
or as otherwise specified on the face hereof). 
Any payment in respect hereof made under such circumstances in U.S.
dollars will not constitute an Event of Default under the Indenture.

 

If the official unit of any
component currency of a composite currency is altered by way of combination or
subdivision, the number of units of that currency as a component shall be
divided or multiplied in the same proportion. 
If two or more component currencies are consolidated into a single
currency, the amounts of those currencies as components shall be replaced by an
amount in such single currency equal to the sum of the amounts of

 

6

 

the consolidated component
currencies expressed in such single currency. 
If any component currency is divided into two or more currencies, the
amount of that original component currency as a component shall be replaced by
amounts of such two or more currencies having an aggregate value on the date of
division equal to the amount of the former component currency immediately
before such division.

 

In the event of an official
redenomination of the Specified Currency or the Optional Payment Currency
(including, without limitation, an official redenomination of any such currency
that is a composite currency), the obligations of the Company to make payments
in or with reference to such currency shall, in all cases, be deemed
immediately following such redenomination to be obligations to make payments in
or with reference to that amount of redenominated currency representing the
amount of such currency immediately before such redenomination.  In no event shall any adjustment be made to
any amount payable hereunder as a result of any redenomination of any component
currency of any composite currency (unless such composite currency is itself
officially redenominated).

 

All determinations referred to
above made by the Exchange Rate Agent shall be at its sole discretion (except
to the extent expressly provided herein that any determination is subject to
approval by the Company) and, in the absence of manifest error, shall be
conclusive for all purposes and binding on the Holder hereof, and the Exchange
Rate Agent shall have no liability therefor.

 

All currency exchange costs
will be borne by the Holder hereof by deduction from the payments made hereon.

 

Section 3.  Redemption.  If so specified on the face hereof, the
Company may at its option redeem this Note in whole or from time to time in
part on or after the date designated as the Initial Redemption Date on the face
hereof at either a price based on a constant percentage of the Principal Amount
of this Note as specified on the face hereof or at prices declining from the
premium specified on the face hereof, if any, to 100% of the Principal Amount
hereof, together, in each case, with accrued interest to the Redemption Date.
The Company may exercise such option by causing the Trustee to mail by
first-class mail to the Holder hereof a notice of such redemption at least 30
but not more than 60 days prior to the Redemption Date.  In the event of redemption of this Note in
part only, a new Note or Notes of this series for the unredeemed portion hereof
shall be issued in the name of the Holder hereof upon the cancellation hereof
in accordance with the terms of the Indenture. Unless otherwise specified on
the face hereof, if less than all of the Notes with like tenor and terms to
this Note are to be redeemed, the Notes to be redeemed shall be selected by the
Trustee by such method as the Trustee shall deem fair and appropriate.

 

Section 4.  Sinking
Funds and Amortizing Notes.  Unless
otherwise specified on the face hereof or unless this Note is an Amortizing
Note, this Note will not be subject to any sinking fund.  If it is specified on the face hereof that
this Note is an Amortizing Note, the Company will make payments combining
principal and interest on the dates and in the amounts set forth in the table
appearing in Schedule I, attached to this Note. 
If this Note is an Amortizing Note, payments made hereon will be applied
first to interest due and payable on each such payment date and then to the
reduction of the Outstanding Face Amount. 
The term “Outstanding Face Amount” means, at any time, the amount of
unpaid principal hereof at such time.

 

Section 5.  Optional
Repayment.  If so specified on the
face hereof, this Note will be repayable prior to the Maturity Date at the
option of the Holder on the Optional Repayment Dates specified on the face
hereof at the Optional Repayment Prices specified on the face hereof, together
with accrued interest to the applicable Optional Repayment Date.  Unless otherwise specified on the face hereof,
in order for this Note to be so repaid, the Company must receive, at least 30
but not more than 45 days prior to an Optional Repayment Date, either (i) this
Note with the form below entitled “Option to Elect Repayment” duly completed or
(ii) a telegram, telex, facsimile transmission or letter from a member of
a national securities exchange or the National Association of Securities
Dealers, Inc. or a commercial bank or trust company in the United States
setting forth the name of the Holder hereof, the Face Amount hereof, the Face
Amount to be repaid, the certificate number hereof or a description of the
tenor and terms of this Note, a statement that the option to elect repayment is
being exercised thereby and a guarantee that this Note with the form below
entitled “Option to Elect Repayment” duly completed will be received by the
Paying Agent not later than five Business Days after the date of such telegram,
telex, facsimile transmission or letter and this Note and form duly completed
are received by the Paying Agent by such fifth Business Day.  Exercise of this repayment option shall be
irrevocable, except as otherwise provided under Section 6 or Section 9.  The repayment option may be exercised by the
Holder of this Note with respect to less than the Face Amount then outstanding

 

7

 

provided that the Face Amount
of the Note remaining outstanding after repayment is an authorized
denomination.  Upon such partial
repayment this Note shall be cancelled and a new Note or Notes for the
remaining Face Amount hereof shall be issued in the name of the Holder of this
Note.

 

Section 6.  Optional
Interest Reset.  If so specified on
the face hereof, the Interest Rate on this Note may be reset at the option of
the Company, in the manner set forth below (unless otherwise specified on the
face hereof), on the Optional Reset Date or Optional Reset Dates specified on
the face hereof.  The Company may
exercise such option by notifying the Trustee in writing of such exercise at
least 45 but not more than 60 days prior to an Optional Reset Date.  Not later than five Business Days after
receipt thereof, the Trustee will mail by first-class mail to the Holder of
this Note a notice (the “Reset Notice”) setting forth (i) the election of
the Company to reset the interest rate, (ii) such new interest rate and (iii) the
provisions, if any, for redemption during the period from such Optional Reset
Date to the next Optional Reset Date or, if there is no such next Optional
Reset Date, to the Maturity Date of this Note (each such period a “Subsequent
Interest Period”), including the date or dates on which or the period or
periods during which and the price or prices at which such redemption may occur
during such Subsequent Interest Period. 
The Reset Notice shall be substantially in the form of Exhibit A to
this Note.  Upon the transmittal by the
Trustee of a Reset Notice to the Holder of this Note, such new interest rate
shall take effect automatically, and, except as modified by the Reset Notice
and as described in the next paragraph, this Note will have the same terms as
prior to the transmittal of such Reset Notice.

 

Notwithstanding the foregoing,
not later than 20 days prior to an Optional Reset Date, the Company may, at its
option, revoke the interest rate provided for in the Reset Notice and establish
an interest rate that is higher than the interest rate provided for in the
Reset Notice for the Subsequent Interest Period commencing on such Optional
Reset Date by causing the Trustee to mail by first-class mail notice of such higher
interest rate to the Holder of this Note. 
Such notice shall be irrevocable and shall be mailed by the Trustee
within five Business Days after receipt thereof.  All Notes with respect to which the interest
rate is reset on an Optional Reset Date will bear such higher interest rate for
the Subsequent Interest Period.

 

If the Company elects to reset
the interest rate of this Note, the Holder of this Note will have the option to
elect repayment by the Company of this Note, or any portion hereof, on any Optional
Reset Date at a price calculated with reference to the Face Amount hereof to be
repaid, plus any interest accrued to, such Optional Reset Date.  In order to obtain repayment on an Optional
Reset Date, the Holder must follow the procedures set forth above in Section 5
for optional repayment except that the period for delivery or notification to
the Trustee shall be at least 25 but not more than 35 days prior to such
Optional Reset Date and except that, if the Holder has tendered this Note for
repayment pursuant to the Reset Notice, the Holder may, by written notice to
the Trustee, revoke such tender for repayment until the close of business on
the tenth day prior to such Optional Reset Date; provided, however,
that if such day is not a Business Day, then such notice may be given on the
next succeeding Business Day.

 

Section 7.  Survivor’s
Option.  If so specified on the face
hereof, the Representative (defined below) of a deceased beneficial owner of
this Note shall have the option to elect to require repayment, in whole or from
time to time in part, of such Note following the death of the beneficial owner
(a “Survivor’s Option”). The Survivor’s Option may not be exercised unless the
Note was acquired by the beneficial owner at least six months prior to the
trustee’s receipt of written request for repayment as provided below.

 

If the Survivor’s Option is applicable to a
Note, upon the valid exercise of the Survivor’s Option, the Company shall repay
the Note (or portion thereof), properly tendered for repayment by or on behalf
of the person (the “Representative”) that has authority to act on behalf of the
deceased beneficial owner of a Note under the laws of the appropriate
jurisdiction (including, without limitation, the personal representative or
executor of the deceased beneficial owner or the surviving joint owner of the
deceased beneficial owner) at a price equal to 100% of the principal amount of
the deceased beneficial owner’s beneficial interest in such Note plus accrued
interest to the date of such repayment, subject to the following limitations:

 

1.               The Company may, in
its sole discretion, limit the aggregate principal amount of Medium-Term Notes,
Series I, without regard to series or tranches, as to which exercises of
the Survivor’s Option shall be accepted from all deceased beneficial owners in
any calendar year (the “Annual Put Limitation”) to an amount equal to the
greater of $1,000,000 or 1.0% of the aggregate principal

 

8

 

amount of such notes, without regard to series or
tranches, as of the end of the most recent calendar year, and (ii) limit
the aggregate principal amount of such notes issued prior to the date hereof,
without regard to series or tranches, as to which exercises of the Survivor’s Option
will be accepted in any calendar year from the authorized representative for
any individual deceased beneficial owner to $125,000 (the “Individual Put
Limitation”).

 

2.               The Company shall
not make principal repayments pursuant to exercise of the Survivor’s Option in
amounts that are less than the minimum authorized denomination, and, in the
event that any partial exercise of the Survivor’s Option or the limitations
described in the preceding sentence would result in the partial repayment of
any Note, the principal amount of such Note remaining Outstanding after
repayment must be at least the minimum authorized denomination.

 

3.               A valid exercise of
the Survivor’s Option with respect to any Note (or portion thereof) may not be
withdrawn.

 

Each Note (or portion thereof) that is
tendered pursuant to a valid exercise of the Survivor’s Option shall be
accepted in the order of all such exercises that are received by the Trustee,
except for any Note (or portion thereof) the acceptance of which would
contravene (i) the Annual Put Limitation, if applied, or (ii) the
Individual Put Limitation, if applied, with respect to the relevant individual
deceased beneficial owner. If, as of the end of any calendar year, the
aggregate principal amount of Notes (or portions thereof) that have been
tendered pursuant to the valid exercise of the Survivor’s Option during such
year has exceeded either the Annual Put Limitation, if applied, or the
Individual Put Limitation, if applied, for such year, any exercise(s) of
the Survivor’s Option with respect to Notes (or portions thereof) not accepted
during such calendar year because such acceptance would have contravened either
such limitation, if applied, shall be deemed to be tendered in the following
calendar year in the order all such Notes (or portions thereof) were originally
tendered. Any Note (or portion thereof) accepted for repayment pursuant to
exercise of the Survivor’s Option shall be repaid on the first Interest Payment
Date that occurs 20 or more calendar days after the date of such acceptance. In
the event that a Note (or any portion thereof) tendered for repayment pursuant
to a valid exercise of the Survivor’s Option is not accepted, the Trustee shall
deliver a notice by first-class mail to the registered holder thereof, at its
last known address as indicated in the Security Register, that states the
reason such Note (or portion thereof) has not been accepted for payment.

 

In order for a Survivor’s Option to be
validly exercised with respect to any Note (or portion thereof), the Trustee
must receive from the Representative (i) a written request for repayment
signed by the Representative, and such signature must be guaranteed by a firm
that is a participant in the Security Transfer Agents Medallion Program, the
New York Stock Exchange Medallion Signature Program or the Stock Exchange
Medallion Program, (ii) appropriate evidence satisfactory to the Trustee
that (A) the deceased was the beneficial owner of such Note at the time of
death and the interest in such Note was acquired by the deceased beneficial
owner at least six months prior to the Trustee’s receipt of the request for
repayment, (B) the death of such beneficial owner has occurred, and the
date of such death, and (C) the Representative has authority to act on
behalf of the deceased beneficial owner, (iii) if the interest in such
Note is held by a nominee or trustee of, custodian for, or another person in a
similar capacity to, the deceased beneficial owner, evidence satisfactory to
the Trustee from such nominee, trustee, custodian or similar person attesting
to the deceased’s beneficial ownership in such Note, (iv) tax waivers and
such other instruments or documents that the Trustee reasonably requires in
order to establish the validity of the beneficial ownership of the Notes and
the claimant’s entitlement to payment, and (v) any additional information
the Trustee requires to evidence satisfaction of any conditions to the exercise
of such Survivor’s Option or to document beneficial ownership or authority to
make the election and to cause the repayment of such Note. Subject to the
Issuer’s right hereunder to impose an Annual Put Limitation and an Individual
Put Limitation, all questions as to the eligibility or validity of any exercise
of the Survivor’s Option shall be determined by the Trustee, in its sole
discretion, which determination shall be final and binding on all parties.

 

The death of a person holding a
beneficial ownership interest in a Note: (a) with any person in a joint
tenancy with right of survivorship; or (b) with his or her spouse in
tenancy by the entirety, tenancy in common, as community property or in any
other joint ownership arrangement, shall be deemed the death of a beneficial
owner of that note, and the entire principal amount of the Note held in this
manner shall be subject to repayment by the Issuer upon valid exercise of the
Survivor’s Option; provided, however, that the death of a person
holding a beneficial ownership interest in a Note as tenant in common with a
person other than his or her spouse shall be deemed the

 

9

 

death of a beneficial owner
only with respect to the such deceased person’s interests in the Note, and only
the deceased beneficial owner’s percentage interest in the principal amount of
the Note shall be subject to repayment. 
If the ownership interest in a Note is held by a nominee for a
beneficial owner or by a custodian under the Uniform Gifts to Minors Act or
Uniform Transfer to Minors Act, or by a trustee of a trust that is wholly
revocable by the beneficial owner, or by a guardian or committee for a
beneficial owner, the death of the beneficial owner of that Note shall
constitute the death of the beneficial owner for purposes of the Survivor’s
Option, if the beneficial ownership interest can be established to the
satisfaction of the Trustee.  In these
cases, the death of the nominee, custodian, trustee, guardian or committee
shall not be deemed the death of the beneficial owner of such Note for purposes
of the Survivor’s Option.

 

Section 8.  OID
Notes.  If this Note is an OID Note,
the amount payable in the event of redemption by the Company, repayment at the
option of the Holder or acceleration of Maturity shall be the Amortized Face
Amount of this Note as of the date of such redemption, repayment or declaration
of acceleration rather than the Face Amount hereof.  The “Amortized Face Amount” of this Note
shall be the amount equal to (a) the Issue Price (as set forth on the face
hereof) plus (b) the original issue discount amortized from the Issue Date
to the date as of which the Amortized Face Amount is calculated, which
amortization shall be calculated using the “interest method” (computed in
accordance with generally accepted accounting principles in effect on such
date) but in no event shall the Amortized Face Amount of this Note exceed the
Face Amount.

 

Section 9.  Dual
Currency Notes.  If it is specified
on the face hereof that this Note is a Dual Currency Note, the Company has a
one time option, exercisable on any one of the Option Election Dates specified
on the face hereof in whole, but not in part, with respect to all Dual Currency
Notes issued on the same day and having the same terms as this Note (this “Tranche”),
of thereafter making all payments of principal, premium, if any, and interest
(which payments would otherwise be made in the Specified Currency of such
Notes) in the Optional Payment Currency specified on the face hereof.  If the Company makes such an election, the
amount of Optional Payment Currency payable in respect hereof shall be
determined by the Exchange Rate Agent by converting the amount of Specified
Currency that would otherwise be payable into the Optional Payment Currency at
the Designated Exchange Rate specified on the face hereof.

 

The Company may exercise such
option by notifying the Trustee of such exercise on or prior to the Option
Election Date.  The Trustee will mail by
first-class mail to each holder of a Note of this Tranche a notice of such
election within five Business Days of the Option Election Date which shall
state (i) the first date, whether an Interest Payment Date and/or the
Maturity Date, on which scheduled payments in the Optional Payment Currency
will be made and (ii) the Designated Exchange Rate.  Any such notice by the Company, once given,
may not be withdrawn.

 

If this Note is a Dual Currency
Note, unless otherwise specified on the face hereof and notwithstanding any
prior election made by the Company, the amount payable hereon in the event of
any optional redemption by the Company, any repayment at the option of the
Holder, any acceleration of the Maturity of this Note or other prepayment of
this Note prior to the Maturity Date shall be an amount equal to the Principal
Amount hereof otherwise due and payable plus accrued interest to but excluding
the date of redemption, repayment, acceleration or other prepayment minus the
Total Option Value multiplied by a fraction, the numerator of which is the
Principal Amount hereof and the denominator of which is the aggregate Principal
Amount of all Dual Currency Notes of this Tranche.  In no event will such payment be less than
zero. Notwithstanding any prior election made by the Company, such payment
shall be made in the Specified Currency unless otherwise provided on the face
hereof.

 

The term “Total Option Value”
means, with respect to any Dual Currency Note on any date, an amount
(calculated as of such date by the Option Value Calculation Agent) equal to the
sum of the Option Values (calculated as of such date by the Option Value
Calculation Agent) for all Interest Payment Dates occurring after the date of
calculation up to and including the Maturity Date.  The term “Option Value” means, with respect
to an Interest Payment Date or the Maturity Date, the amount calculated by the
Option Value Calculation Agent to be the arithmetic average of the prices
quoted on the date of calculation by three reference banks (which banks shall
be selected by the Option Value Calculation Agent and shall be reasonably
acceptable to the Company) for the right on the Option Election Date
immediately preceding such Interest Payment Date or Maturity Date to purchase
for value on such Interest Payment Date or Maturity Date from such reference
banks (A) the aggregate amount of the Specified Currency due on such
Interest Payment Date or Maturity Date with respect to all of the Dual Currency

 

10

 

Notes of this Tranche in
exchange for (B) the amount of the Optional Payment Currency that would be
received if the amount in clause (A) were converted into the Optional
Payment Currency at the Designated Exchange Rate.

 

All determinations referred to
above made by the Exchange Rate Agent or the Option Value Calculation Agent
shall be at their sole discretion (except to the extent expressly provided
herein that any determination is subject to approval by the Company) and, in
the absence of manifest error, shall be conclusive for all purposes and binding
on the Holder hereof, and neither the Exchange Rate Agent nor the Option Value Calculation
Agent shall have any liability therefor.

 

Section 10.  Extension
of Maturity Notes.  If it is
specified on the face hereof that this Note is an Extension of Maturity Note,
the Company has the option to extend the Maturity Date hereof for the number of
Extension Periods set forth on the face hereof, each of which Extension Periods
shall be a period of from one to five whole years.  Unless otherwise specified on the face
hereof, the following procedures shall apply if this Note is an Extension of Maturity
Note.

 

The Company may exercise its
option by notifying the Trustee of such exercise at least 45 but not more than
60 days prior to the Maturity Date hereof in effect prior to the exercise of
such option (the “Original Stated Maturity”). 
Not later than five Business Days after receipt thereof, the Trustee
will mail to the Holder a notice (the “Extension Notice”), first class, postage
prepaid, setting forth (i) the election of the Company to extend the
Maturity Date, (ii) the new Maturity Date, (iii) the Interest Rate
applicable to the Extension Period and (iv) the provisions, if any, for
redemption during the Extension Period, including the date on which or the
period or periods during which and the price at which such redemption may occur
during the Extension Period.  Upon the
mailing by the Trustee of an Extension Notice to the Holder, the Maturity Date
hereof shall be extended automatically, and, except as modified by the
Extension Notice and as described in the next paragraph, this Note will have the
same terms as prior to the mailing of such Extension Notice.

 

Notwithstanding the foregoing,
not later than 20 days prior to the Original Stated Maturity hereof, the
Company may, at its option, revoke the interest rate provided for in the
Extension Notice and establish a higher interest rate for the Extension Period
by causing the Trustee to mail notice of such higher interest rate, first
class, postage prepaid, to the Holder. 
Such notice shall be irrevocable and shall be mailed by the Trustee
within three Business Days after receipt thereof.  This Note will bear such higher interest rate
for the Extension Period, whether or not tendered for repayment.

 

If the Company extends the
Maturity Date of this Note, the Holder will have the option to elect repayment
by the Company of this Note, or any portion hereof, on the Original Stated
Maturity at a price calculated with reference to the Face Amount hereof to be
repaid plus any accrued interest to such date. 
In order for this Note to be so repaid on the Original Stated Maturity,
the Holder must follow the procedures set forth in Section 5 hereof for
optional repayment, except that the period for delivery of this Note or
notification to the Trustee shall be at least 25 but not more than 35 days
prior to the Original Stated Maturity and except that the Holder may, by
written notice to the Trustee, revoke any such tender for repayment until the
close of business on the tenth day prior to the Original Stated Maturity; provided, however,
that if such day is not a Business Day, then such notice may be given on the
next succeeding Business Day.

 

Section 11.  Extendible
Notes.  If it is specified on the
face hereof that this Note is an Extendible Note, this Note will mature on the
Initial Maturity Date specified on the face hereof unless the Maturity of all
or any portion of this Note is extended in accordance with the procedures
described below.

 

On the Interest Payment Date
occurring in the sixth month (unless a different Special Election Interval is
specified on the face hereof) prior to the Initial Maturity Date hereof (the “Initial
Maturity Extension Date”) and on the Interest Payment Date occurring in each
sixth month (or the last month of each Special Election Interval) after such
Initial Maturity Extension Date (each, together with the Initial Maturity
Extension Date, a “Maturity Extension Date”), the Maturity of this Note will be
extended to the Interest Payment Date occurring in the twelfth month (or, if a
Special Election Interval is specified on the face hereof, the last month in a
period equal to twice the Special Election Interval) after such Maturity
Extension Date, unless the Holder elects to terminate the automatic extension
of the Maturity hereof or any portion hereof as described below.

 

11

 

If the Holder elects to
terminate the automatic extension of the Maturity of any portion of the
principal amount of this Note during the specified period prior to any Maturity
Extension Date, such portion will become due and payable on the Interest
Payment Date occurring in the sixth month (or the last month in the Special
Election Interval) after such Maturity Extension Date (the “Extended Maturity
Date”).

 

The Holder may elect to
terminate the automatic extension of the Maturity of this Note, or if so
specified above, any portion hereof, by delivering a notice to such effect to
the Trustee (or any duly appointed Paying Agent) at the Corporate Trust Office
not less than 15 nor more than 30 days prior to such Maturity Extension Date
(unless another period is specified on the face hereof as the “Special Election
Period”).  Such election will be
irrevocable and will be binding upon each subsequent Holder of this Note.  An election to terminate the automatic
extension of the Maturity of this Note may be exercised with respect to less
than the entire Face Amount hereof only if so specified on the face hereof and
only in such Face Amount, or any integral multiple in excess thereof, as is
specified on the face hereof. Notwithstanding the foregoing, the Maturity of
this Note will not be extended beyond the Maturity Date specified on the face
hereof.

 

Unless otherwise specified
above, any such election to terminate will be effective only if this Note, with
the “Option to Elect Termination of Automatic Extension” included herein duly
executed, is presented to the Trustee (or any duly appointed Paying Agent)
simultaneously with notice of such election (or, in the event notice of such
election, together with a guarantee of delivery within five Business Days, is
transmitted on behalf of the Holder from a member of a national securities
exchange, the National Association of Securities Dealers, Inc. or a
commercial bank or trust company in the United States, within five Business
Days of the date of such notice). As soon as practicable following receipt of
this Note the Trustee (or any duly appointed Paying Agent) shall issue in
exchange herefor in the name of the Holder (i) a Note, in a face amount
equal to the face amount of this Note for which the election to terminate the
automatic extension of Maturity was exercised, with terms identical to those
specified herein (except for the Issue Date and the Initial Interest Rate and
except that such Note shall have a fixed, non-extendable Maturity on the
Extended Maturity Date) and (ii) if such election is made with respect to
less than the full Face Amount hereof, a replacement Renewable Note, in a face
amount equal to the Face Amount of this Note for which no election was made,
with terms identical to this Note.

 

Section 12.  Principal
Amount For Indenture Purposes.  For
the purpose of determining whether Holders of the requisite amount of Notes
outstanding under the Indenture have made a demand, given a notice or waiver or
taken any other action, the outstanding principal amount of this Note will be
deemed to be the Principal Amount, provided,
however, if this Note is an OID
Note, the outstanding principal amount of this Note will be deemed to be the
amount of the principal thereof that would be due and payable as of the date of
such determination upon a declaration of acceleration of the maturity thereof.

 

Section 13.  Modification
and Waivers.  The Indenture contains
provisions permitting the Company and the Trustee, with the consent of the
holders of not less than 66-2/3% in aggregate principal amount of each series
of the Securities at the time Outstanding to be affected, evidenced as in the
Indenture provided, to execute supplemental indentures adding any provisions to
or changing in any manner or eliminating any of the provisions of the Indenture
or of any supplemental indenture or modifying in any manner the rights of the
holders of the Securities of all such series; provided,
however, that no such
supplemental indenture shall, among other things, (i) extend the fixed
maturity of any Security, or reduce the principal amount thereof, or reduce the
rate or extend the time of payment of interest thereon or reduce any premium
payable on redemption, or make the principal thereof, or premium, if any, or
interest thereon payable in any coin or currency other than that hereinabove
provided, without the consent of the holder of each Security so affected, or (ii) change
the place of payment on any Security, or impair the right to institute suit for
payment on any Security, or reduce the aforesaid percentage of Securities, the
holders of which are required to consent to any such supplemental indenture,
without the consent of the holders of each Security so affected.  It is also provided in the Indenture that,
prior to any declaration accelerating the Maturity of any series of Securities,
the holders of a majority in aggregate principal amount of the Securities of
such series Outstanding may on behalf of the holders of all the Securities of
such series waive any past default or Event of Default under the Indenture with
respect to such series and its consequences, except a default in the payment of
interest, if any, on or the principal of, or premium if any, on any of the
Securities of such series, or in the payment of any sinking fund installment or
analogous obligation with respect to Securities of such series.  Any such consent or waiver by the Holder of
this Note shall be conclusive and binding upon such Holder and upon all future
holders and

 

12

 

owners of this Note and any
Notes which may be issued in exchange or substitution herefor, irrespective of
whether or not any notation thereof is made upon this Note or such other Notes.

 

Section 14.  Obligations
Unconditional.  No reference herein
to the Indenture and no provisions of this Note or of the Indenture shall alter
or impair the obligation of the Company, which is absolute and unconditional,
to pay the principal of, premium, if any, and interest, if any, on this Note at
the place, at the respective times, at the rate, and in the coin or currency
herein prescribed.

 

Section 15.  Defeasance.  The Indenture contains provisions for the
discharge of the Indenture and defeasance at any time of the indebtedness on
this Note upon compliance by the Company with certain conditions set forth
therein, which provisions apply to this Note.

 

Section 16.  Authorized
Form and Denominations.  The
Notes of this series are issuable in registered form, without coupons.  Unless otherwise set forth on the face
hereof, Notes denominated in U.S. dollars will be issued in Face Amount
denominations of U.S.$100,000 and any integral multiple of U.S.$1,000 in excess
thereof.  Notes denominated in a Foreign
Currency will be issued in the denomination or denominations set forth on the
face hereof.  Each Note will be issued
initially as either a Global Security or a Certificated Note, at the option of
the holders thereof, either at the office or agency to be designated and
maintained by the Company for such purpose in the Borough of Manhattan, New
York City, pursuant to the provisions of the Indenture or at any of such other
offices or agencies as may be designated and maintained by the Company for such
purpose pursuant to the provisions of the Indenture, and in the manner and
subject to the limitations provided in the Indenture, but without the payment
of any service charge, except for any tax or other governmental charges imposed
in connection therewith.  Notes of this
series are exchangeable for a like aggregate Face Amount of Notes of this
series of a different authorized denomination, except that Global Securities
will not be exchangeable for Certificated Notes.

 

Section 17.  Registration
of Transfer.  As provided in the
Indenture and subject to certain limitations as therein set forth, the transfer
of this Note is registrable in the Security Register, upon surrender of this
Note for registration of transfer, at the Corporate Trust Office or agency in a
Place of Payment for this Note, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar requiring such written instrument of transfer duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Notes of this series, of authorized denominations and for the same
aggregate Face Amount, will be issued to the designated transferee or
transferees.

 

If this Note is a Global
Security and if at any time the Depository notifies the Company that it is
unwilling or unable to continue as Depository or if at any time the Depository
shall no longer be eligible under the Indenture, the Company shall appoint a
successor Depository.  If a successor
Depository for the Securities of such series is not appointed by the Company
within 90 days after the Company receives such notice or becomes aware of such
ineligibility, the Company will issue, and the Trustee will authenticate and
deliver, Notes in definitive form in an aggregate Face Amount equal to the Face
Amount hereof.

 

No service charge shall be made
for any such registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection therewith.

 

Prior to due presentment of
this Note for registration of transfer, the Company, the Trustee and any agent
of the Company or the Trustee may treat the person in whose name this Note is
registered as the owner hereof for all purposes, and neither the Company nor
the Trustee nor any agent of the Company or of the Trustee shall be affected by
any notice to the contrary.

 

Section 18.  Events
of Default.  If an Event of Default
with respect to Notes of this series shall occur and be continuing, the
principal of the Notes of this series may be declared due and payable in the
manner and with the effect provided in the Indenture.  In the event that this Note is an OID Note or
a Dual Currency Note, the amount of principal of this Note that becomes due and
payable upon such acceleration shall be equal to the amount calculated as set
forth in Section 7 or Section 8, respectively, hereof.  Upon payment (i) of the aggregate
applicable amounts of principal of the Notes of this series so declared due and
payable and (ii) of interest on any overdue principal and overdue interest
(in each case to the extent that the payment of such interest shall be legally

 

13

 

enforceable), all of the
Company’s obligations in respect of the payment of the principal of and
interest, if any, on the Notes of this series shall terminate.

 

Section 19.  No
Recourse Against Certain Persons.  No
recourse for the payment of the principal of, premium, if any, or interest on
this Note, or for any claim based hereon or otherwise in respect hereof, and no
recourse under or upon any obligation, covenant or agreement of the Company in
the Indenture or any Indenture supplemental thereto or in any Note, or because
of the creation of any indebtedness represented thereby, shall be had against
any incorporator, stockholder, officer or director, as such, past, present or
future, of the Company or of any successor corporation, either directly or
through the Company or any successor corporation, whether by virtue of any
constitution, statute or rule of law or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issue hereof, expressly waived
and released.

 

Section 20.  Defined
Terms.  All terms used but not
defined in this Note are used herein as defined in the Indenture.

 

Section 21.  GOVERNING
LAW.  THIS NOTE SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

14

 

OPTION TO ELECT REPAYMENT

 

The undersigned owner of this
Note hereby irrevocably elects to have the Company repay the Face Amount of
this Note or portion hereof below designated at (i) the Optional Repayment
Percentage multiplied by the Principal Amount of this Note to be repaid in
respect of such Face Amount plus accrued interest to the Optional Repayment
Date, if this Note is to be repaid pursuant to the Optional Repayment provision
described in Section 5 hereof, or (ii) 100% of the Principal Amount
of this Note to be repaid in respect of such Face Amount plus accrued interest
to the Optional Reset Date, if this Note is to be repaid pursuant to the
Optional Interest Reset provision described in Section 6 hereof or the
Extension of Maturity Notes provision described in Section 9 hereof.  Any such election is irrevocable except as
provided in Section 6 or Section 9 hereof.

 

	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Signature

  
	
   

  	
  Sign exactly
  as name appears on the front of

  
	
   

  	
  this Note
  [SIGNATURE GUARANTEED - required

  
	
   

  	
  only if
  Notes are to be issued and delivered

  
	
   

  	
  to other
  than the registered Holder]

  
	
   

  	
   

  
	
  Face Amount
  to be repaid, if amount to be repaid is less

  	
  Fill in for
  registration of Notes if to be issued otherwise

  
	
  than the
  Face Amount of this Note (Face Amount

  	
  than to the
  registered Holder:

  
	
  emaining
  must be an authorized denomination)

  	
   

  
	
   

  	
  Name

  	
   

  	
   

  
	
  $:

  	
   

  	
   

  	
  Address:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Please
  print name and address

  
	
   

  	
   

  	
  including zip code)

  
	
   

  	
   

  
	
   

  	
  SOCIAL
  SECURITY OR OTHER TAXPAYER ID

  
	
   

  	
  NUMBER

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
										

 

15

 

OPTION TO ELECT TERMINATION OF
AUTOMATIC EXTENSION

 

The undersigned owner of this
Note hereby irrevocably elects to terminate the automatic extension of this
Note or of the portion of the Face Amount of this Note below designated.  Any such election is irrevocable and will be
binding on any subsequent Holder hereof.

 

	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Signature

  
	
   

  	
  Sign exactly
  as name appears on the front of

  
	
   

  	
  this Note
  [SIGNATURE GUARANTEED - required

  
	
   

  	
  only if
  Notes are to be issued and delivered

  
	
   

  	
  to other
  than the registered Holder]

  
	
   

  	
   

  
	
  Face Amount
  to be terminated, if amount to be

  	
  Fill in for
  registration of Notes if to be issued otherwise

  
	
  terminated
  is less than the Face Amount of this Note

  	
  than to the
  registered Holder:

  
	
  (such Face
  Amount must be an authorized

  	
   

  
	
  denomination)

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Address:

  	
   

  	
   

  
	
  $

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Please
  print name and address

  
	
   

  	
   

  	
  including zip code)

  
	
   

  	
   

  
	
   

  	
  SOCIAL
  SECURITY OR OTHER TAXPAYER

  
	
   

  	
  ID NUMBER

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
									

 

16

 

ABBREVIATIONS

 

The following abbreviations,
when used in the inscription on the face of this instrument, shall be construed
as though they were written out in full according to applicable laws or
regulations:

 

	
   

  	
  TEN COM

  	
   

  	
  -

  	
  as tenants
  in common

  
	
   

  	
  TEN ENT

  	
   

  	
  -

  	
  as tenant by
  the entireties

  
	
   

  	
  JT TEN

  	
   

  	
  -

  	
  as joint tenants
  with right of survivorship

  and not as
  tenants in common

  
	
   

  	
  UNIF GIFT

  	
   

  	
   

  
	
   

  	
  MIN ACT

  	
   

  	
  -

  	
                     Custodian                    

       (Cust)                       (Minor)

  Under Uniform Gifts to Minors Act

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (State)

  	
   

  

 

Additional abbreviations may
also be used though not in the above list.

 

FOR VALUE RECEIVED, the undersigned hereby
sell(s), assign(s) and transfer(s) unto

 

                                                                                                                                                                                

PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE

 

                                                                                                                                                                                

Please print or type name and address, including zip code of assignee

 

                                                                                                                                                                                

the within Note of LEHMAN BROTHERS HOLDINGS INC. and all rights thereunder and
does hereby irrevocably constitute and appoint                                                                                                             
Attorney to transfer the said Note on the books of the within-named Company,
with full power of substitution in the premises.

 

	
  Dated:

  	
   

  	
   

  
	
   

  
	
  SIGNATURE
  GUARANTEED:

  	
   

  	
   

  
	
   

  	
  NOTICE: The
  signature to this

  
	
   

  	
  assignment
  must correspond with the

  
	
   

  	
  name as it
  appears upon the face of 

  
	
   

  	
  the within
  Note in every particular, 

  
	
   

  	
  without
  alteration or enlargement or 

  
	
   

  	
  any change
  whatsoever.

  
						

 

17

 

SCHEDULE I

 

Amortization Table

 

	
  Date

  	
  Payment

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

EXHIBIT A

 

RESET NOTICE

 

LEHMAN BROTHERS HOLDINGS INC.

Medium-Term Notes, Series I

(Fixed Rate)

CUSIP No.                       

Registered Nos.        -      

 

LEHMAN BROTHERS HOLDINGS INC.,
a corporation duly organized and existing under the laws of the State of
Delaware (the “Company”), is the issuer of the above-referenced Notes (the “Notes”).  Capitalized terms used herein and not defined
are used as defined in the Notes.

 

The Company hereby elects to
reset the Interest Rate set forth on the face of the Notes.  On and after                                   (1),
the Interest Rate shall be                               .

 

Each Holder of a Note has the
option to elect repayment by the Company of such Note, or any portion thereof,
on any Optional Reset Date pursuant to the terms of such Note.  The Notes may be repaid on the dates and at
the prices set forth below:

 

	
   

  	
  Date

  	
  Redemption Price

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

IN WITNESS WHEREOF, Lehman
Brothers Holdings Inc. has caused this Reset Notice to be signed by its
Chairman of the Board, its President, its Vice Chairman, its Chief Financial
Officer, one of its Vice Presidents or its Treasurer and to be attested by its
Secretary or one of its Assistant Secretaries.

 

	
  Dated:

  	
   

  	
  LEHMAN
  BROTHERS HOLDINGS INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
         Title:

  
	
   

  	
   

  
	
   

  	
  Attest:

  	
   

  	
   

  
	
   

  	
              Title:

  
						

 

(1)           Insert applicable Optional Reset
Date.Exhibit 10.1

 

[EXECUTION

COUNTERPART]

 

[Published CUSIP Number: 035255108]

 

 

CREDIT AGREEMENT

 

Dated as of January 31, 2008

 

 

among

 

 

ANIKA
THERAPEUTICS, INC.

as Borrower,

 

ANIKA
SECURITIES, INC.

as a
Guarantor,

 

 

BANK OF AMERICA, N.A.,

as Administrative Agent,

 

 

and

The Other Lenders Party Hereto

 

 

 

 

TABLE OF CONTENTS

 

	
  Section

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE I.

  	
  DEFINITIONS AND ACCOUNTING TERMS

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.01

  	
  Defined Terms

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.02

  	
  Other Interpretive Provisions

  	
  18

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.03

  	
  Accounting Terms

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.04

  	
  Rounding

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.05

  	
  Times of Day

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II.

  	
  THE COMMITMENTS AND BORROWINGS

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.01

  	
  Revolving Credit Borrowings

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.02

  	
  Borrowings, Conversions and Continuations of Loans

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.03

  	
  Term Borrowings

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.04

  	
  [Reserved]

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.05

  	
  Prepayments

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.06

  	
  Termination or Reduction of Commitments

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.07

  	
  Repayment of Loans

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.08

  	
  Interest

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.09

  	
  Fees

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.10

  	
  Computation of Interest and Fees

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.11

  	
  Evidence of Debt

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.12

  	
  Payments Generally; Agent’s Clawback

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.13

  	
  Sharing of Payments

  	
  26

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III.

  	
  TAXES, YIELD PROTECTION AND ILLEGALITY

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.01

  	
  Taxes

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.02

  	
  Illegality

  	
  28

  
					

 

i

 

	
   

  	
  3.03

  	
  Inability to Determine Rates

  	
  28

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.04

  	
  Increased Costs

  	
  29

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.05

  	
  Compensation for Losses

  	
  30

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.06

  	
  Mitigation Obligations

  	
  31

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.07

  	
  Survival

  	
  31

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV.

  	
  CONDITIONS PRECEDENT TO BORROWINGS

  	
  31

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.01

  	
  Conditions of Initial Borrowing

  	
  31

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.02

  	
  Conditions to all Borrowings

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V.

  	
  REPRESENTATIONS AND WARRANTIES

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.01

  	
  Existence, Qualification and Power

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.02

  	
  Authorization; No Contravention

  	
  34

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.03

  	
  Governmental Authorization; Other Consents

  	
  34

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.04

  	
  Binding Effect

  	
  34

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.05

  	
  Financial Statements; No Material Adverse Effect

  	
  34

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.06

  	
  Litigation

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.07

  	
  No Default

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.08

  	
  Ownership of Property; Liens

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.09

  	
  Environmental Compliance

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.10

  	
  Insurance

  	
  36

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.11

  	
  Taxes

  	
  36

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.12

  	
  ERISA Compliance

  	
  36

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.13

  	
  Subsidiaries

  	
  36

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.14

  	
  Margin Regulations; Investment Company Act

  	
  37

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.15

  	
  Disclosure

  	
  37

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.16

  	
  Compliance with Laws

  	
  37

  

 

ii

 

	
   

  	
  5.17

  	
  Taxpayer Identification Number

  	
  37

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.18

  	
  Intellectual Property; Licenses, Etc

  	
  37

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI.

  	
  AFFIRMATIVE COVENANTS

  	
  38

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.01

  	
  Financial Statements

  	
  38

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.02

  	
  Certificates; Other Information

  	
  39

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.03

  	
  Notices

  	
  40

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.04

  	
  Payment of Obligations

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.05

  	
  Preservation of Existence, Etc

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.06

  	
  Maintenance of Properties

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.07

  	
  Maintenance of Insurance

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.08

  	
  Compliance with Laws

  	
  42

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.09

  	
  Books and Records

  	
  42

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.10

  	
  Inspection Rights

  	
  42

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.11

  	
  Use of Proceeds

  	
  42

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.12

  	
  Financial Covenants

  	
  42

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.13

  	
  Additional Guarantors

  	
  42

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII.

  	
  NEGATIVE COVENANTS

  	
  43

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.01

  	
  Liens

  	
  43

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.02

  	
  Investments

  	
  44

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.03

  	
  Indebtedness

  	
  46

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.04

  	
  Fundamental Changes

  	
  47

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.05

  	
  Dispositions

  	
  47

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.06

  	
  Restricted Payments

  	
  48

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.07

  	
  Change in Nature of Business

  	
  48

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.08

  	
  Transactions with Affiliates

  	
  49

  

 

iii

 

	
   

  	
  7.09

  	
  Burdensome Agreements

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.10

  	
  Use of Proceeds

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII.

  	
  EVENTS OF DEFAULT AND REMEDIES

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.01

  	
  Events of Default

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.02

  	
  Remedies Upon Event of Default

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.03

  	
  Application of Funds

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX.

  	
  ADMINISTRATIVE AGENT

  	
  53

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.01

  	
  Appointment and Authorization of Administrative Agent

  	
  53

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.02

  	
  Rights as a Lender

  	
  53

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.03

  	
  Exculpatory Provisions

  	
  53

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.04

  	
  Reliance by Administrative Agent

  	
  54

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.05

  	
  Delegation of Duties

  	
  54

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.06

  	
  Resignation of Agent

  	
  54

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.07

  	
  Non-Reliance on Agent and Other Lenders

  	
  55

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.08

  	
  No Other Duties, Etc

  	
  55

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.09

  	
  Administrative Agent May File Proofs of Claim

  	
  55

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.10

  	
  Guaranty Matters

  	
  56

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X.

  	
  CONTINUING GUARANTY

  	
  56

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.01

  	
  Guaranty

  	
  56

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.02

  	
  Rights of Lenders

  	
  56

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.03

  	
  Certain Waivers

  	
  57

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.04

  	
  Obligations Independent

  	
  57

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.05

  	
  Subrogation

  	
  57

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.06

  	
  Termination; Reinstatement

  	
  57

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.07

  	
  Subordination

  	
  58

  
						

 

iv

 

	
   

  	
  10.08

  	
  Stay of Acceleration

  	
  58

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.09

  	
  Condition of Borrower

  	
  58

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.10

  	
  Rights of Contribution

  	
  58

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.11

  	
  General Limitation on Guarantee Obligations

  	
  59

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.12

  	
  Joint and Several Obligations

  	
  59

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XI.

  	
  MISCELLANEOUS

  	
  60

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.01

  	
  Amendments, Etc

  	
  60

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.02

  	
  Notices; Effectiveness; Electronic Communications

  	
  61

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.03

  	
  No Waiver; Cumulative Remedies

  	
  63

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.04

  	
  Expenses; Indemnity; Damage Waiver

  	
  63

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.05

  	
  Payments Set Aside

  	
  65

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.06

  	
  Successors and Assigns

  	
  65

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.07

  	
  Treatment of Certain Information; Confidentiality

  	
  68

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.08

  	
  Right of Setoff

  	
  69

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.09

  	
  Interest Rate Limitation

  	
  69

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.10

  	
  Counterparts; Integration; Effectiveness

  	
  70

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.11

  	
  Survival of Representations and Warranties

  	
  70

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.12

  	
  Severability

  	
  70

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.13

  	
  Governing Law; Jurisdiction; Etc.

  	
  70

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.14

  	
  WAIVER OF JURY TRIAL

  	
  71

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.15

  	
  No Advisory or Fiduciary Responsibility

  	
  72

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.16

  	
  USA Patriot Act Notice

  	
  72

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.17

  	
  Time of the Essence

  	
  72

  
					

 

v

 

	
  SCHEDULES

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.01

  	
  Commitments and Applicable Percentages

  	
   

  
	
   

  	
  5.06

  	
  Litigation

  	
   

  
	
   

  	
  5.09

  	
  Environmental Matters

  	
   

  
	
   

  	
  5.13

  	
  Subsidiaries and Other Equity Investments

  	
   

  
	
   

  	
  7.01

  	
  Existing Liens

  	
   

  
	
   

  	
  7.02

  	
  Existing Investments

  	
   

  
	
   

  	
  7.03

  	
  Existing Indebtedness

  	
   

  
	
   

  	
  10.02

  	
  Administrative Agent’s Office, Certain Addresses for Notices

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  EXHIBITS

  	
   

  	
   

  	
   

  
	
   

  	
  Form of

  	
   

  	
   

  
	
   

  	
  A.

  	
  Committed Loan Notice

  	
   

  
	
   

  	
  C-1.

  	
  Revolving Credit Note

  	
   

  
	
   

  	
  C-2.

  	
  Term Note

  	
   

  
	
   

  	
  D.

  	
  Compliance Certificate

  	
   

  
	
   

  	
  E.

  	
  Assignment and Assumption

  	
   

  
								

 

vi

 

CREDIT
AGREEMENT

 

CREDIT AGREEMENT (this “Agreement”)
is entered into as of January 31, 2008  among
ANIKA THERAPEUTICS, INC., a
Massachusetts corporation (“Borrower”), ANIKA SECURITIES, INC., a
Massachusetts securities corporation (“Anika Securities”), each lender
from time to time party hereto (collectively, “Lenders” and
individually, a “Lender”), and BANK OF AMERICA, N.A., as Administrative Agent.

 

Borrower has requested that Lenders provide a
revolving credit and term loan facility, and Lenders are willing to do so on
the terms and conditions set forth herein. 
In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:

 

ARTICLE I.           DEFINITIONS AND ACCOUNTING TERMS

 

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

 

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

 

“Administrative
Agent’s Office” means Agent’s address and, as appropriate, account as set
forth on Schedule 10.02, or such other address or account as Agent may
from time to time notify Borrower and Lenders.

 

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

 

“Affiliate”
means, with respect to any Person, another Person that directly, or indirectly
through one or more intermediaries, Controls or is Controlled by or is under
common Control with the Person specified.

 

“Aggregate
Commitments” means the Commitments of all Lenders.

 

“Agreement”
means this Credit Agreement.

 

“Anika
Securities” has the meaning specified in the introductory paragraph hereto.

 

“Applicable
Percentage” means with respect to any Lender at any time, (a) during
the Availability Period, the percentage (carried out to the ninth decimal
place) of the Aggregate Commitments represented by such Lender’s Commitments at
such time and (b) after the Availability Period, the percentage (carried
out to the ninth decimal place) of all Loans represented by the principal
amount of such Lender’s Loans at such time. 
The initial Applicable Percentage of each Lender is set forth opposite
the name of such Lender on Schedule 2.01 or in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable.

 

1

 

“Applicable
Rate” means a per annum rate equal
to:

 

(a)           with
respect to Base Rate Loans, 0.00%;

 

(b)           with
respect to Eurodollar Rate Loans, 0.75%; and

 

(c)           with
respect to the commitment fee, 0.25%.

 

“Assignee
Group” means two or more Eligible Assignees that are Affiliates of one
another.

 

“Assignment
and Assumption” means an assignment and assumption entered into by a Lender
and an assignee (with the consent of any party whose consent is required by Section 11.06(b)),
and accepted by Agent, in substantially the form of Exhibit E or
any other form approved by Agent.

 

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

 

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

 

“Availability
Period” means the period from and including the Closing Date to the
earliest of (a) December 31, 2008, (b) the date of termination
of the Aggregate Commitments pursuant to Section 2.06, and (c) the
date of termination of the commitment of each Lender to make Loans pursuant to Section 8.02.

 

“Bank
of America” means Bank of America, N.A. and its successors.

 

“Base
Rate” means for any day a fluctuating rate per annum equal to the higher of
(a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of
interest in effect for such day as publicly announced from time to time by Bank
of America as its “prime rate.”  The “prime
rate” is a rate set by Bank of America based upon various factors including
Bank of America’s costs and desired return, general economic conditions and
other factors, and is used as a reference point for pricing some loans, which
may be priced at, above, or below such announced rate.  Any change in such rate announced by Bank of
America shall take effect at the opening of business on the day specified in
the public announcement of such change.

 

“Base
Rate Loan” means a Loan that bears interest based on the Base Rate.

 

2

 

“Bedford
Facility” means Borrower’s facility in Bedford, Massachusetts located at 32
Wiggins Avenue.

 

“Borrower”
has the meaning specified in the introductory paragraph hereto.

 

“Borrower
Materials” has the meaning specified in Section 6.02.

 

“Borrowing”
means a Revolving Credit Borrowing or a Term Borrowing, as the context may
require.

 

“Business
Day” means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the Laws of, or are in fact
closed in, the state where Administrative Agent’s Office is located and, if
such day relates to any Eurodollar Rate Loan, means any such day on which
dealings in Dollar deposits are conducted by and between banks in the London
interbank eurodollar market.

 

“Capital
Expenditures” means, with respect to any Person for any period, any
expenditure in respect of the purchase or other acquisition of any fixed or
capital asset (excluding normal replacements and maintenance which are properly
charged to current operations).

 

“Cash
Management Agreement” means any agreement to provide cash management
services, including treasury, depository, overdraft, credit or debit card,
electronic funds transfer and other cash management arrangements that is
entered into by and between any Loan Party and any Cash Management Bank.

 

“Cash
Management Bank” means any Person that, at the time it enters into a Cash
Management Agreement, is a Lender or an Affiliate of a Lender, in its capacity
as a party to such Cash Management Agreement.

 

“Change
in Law” means the occurrence, after the date of this Agreement, of any of
the following: (a) the adoption or taking effect of any law, rule,
regulation or treaty, (b) any change in any law, rule, regulation or
treaty or in the administration, interpretation or application thereof by any
Governmental Authority or (c) the making or issuance of any request,
guideline or directive (whether or not having the force of law) by any
Governmental Authority.

 

“Change
of Control” means an event or series of events by which:

 

(a)           Borrower ceases to be a public
company with a class of Equity Interests that have been distributed by means of
an effective registration statement under the Securities Act of 1933 and which
is subject to the reporting requirements of the Securities Exchange Act of
1934;

 

(b)           the Equity Interests of Borrower
cease to be listed on, or are suspended from trading on, the NASDAQ Global
Select Market or other U.S. national securities exchange; or

 

(c)           Borrower shall cease to own,
beneficially and of record, and control 100% of the equity securities of Anika
Securities or any other Guarantor, or shall cease to have the power,

 

3

 

directly or indirectly, to Control Anika Securities or
any other Guarantor, whether through the ability to exercise voting power, by
contract or otherwise.

 

“Closing
Date” means the first date all the conditions precedent in Section 4.01
are satisfied or waived in accordance with Section 11.01.

 

“Code”
means the Internal Revenue Code of 1986.

 

“Commitment”
means a Revolving Credit Commitment or a Term Commitment, as the context may
require.

 

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

 

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

 

“Consolidated
EBITDA” means, at any date of determination, an amount equal to
Consolidated Net Income of the Borrower and its Subsidiaries on a consolidated
basis for the most recently completed Measurement Period plus (a) the
following to the extent deducted in calculating such Consolidated Net
Income:  (i) Consolidated Interest
Charges, (ii) the provision for Federal, state, local and foreign income
taxes payable, (iii) depreciation and amortization expense and (iv) other
non-recurring expenses reducing such Consolidated Net Income which do not
represent a cash item in such period or any future period (in each case of or
by the Borrower and its Subsidiaries for such Measurement Period) and minus
(b) the following to the extent included in calculating such Consolidated
Net Income:  all non-cash items
increasing Consolidated Net Income (in each case of or by the Borrower and its
Subsidiaries for such Measurement Period). 
Milestone Payments received in cash will be included in the calculation
of Consolidated EBITDA in the year in which such Milestone Payments are
received.

 

“Consolidated
Fixed Charge Coverage Ratio” means, at any date of determination, the ratio
of:

 

(a)           (i) Consolidated EBITDA, plus (ii) non-cash stock compensation expense, less (iii) the aggregate amount of all Unfinanced
CapEx, less (iv) income taxes paid in cash
or accrued (net of any cash refund in respect of income taxes received); to

 

(b)           the sum of (i) Consolidated
Interest Charges, (ii) the aggregate principal amount of all regularly
scheduled principal payments or redemptions or similar acquisitions for value
of all Indebtedness (including the principal component of capital lease
obligations), (iii) rentals payable under leases of personal property,
including equipment (other than the principal component of capital lease
obligations included in clause (ii) of this paragraph), (iv) the
aggregate amount of all Restricted Payments and (v) the aggregate amount
of Federal, state, local and foreign income taxes paid in cash;

 

4

 

in each case, of or by the Borrower and its
Subsidiaries for the most recently completed Measurement Period.

 

“Consolidated
Interest Charges” means, for any Measurement Period, the sum of (a) all
interest, premium payments, debt discount, fees, charges and related expenses
in connection with borrowed money (including capitalized interest) or in
connection with the deferred purchase price of assets, in each case to the
extent treated as interest in accordance with GAAP, (b) all interest paid
or payable with respect to discontinued operations and (c) the portion of
rent expense under Capitalized Leases that is treated as interest in accordance
with GAAP, in each case, of or by the Borrower and its Subsidiaries on a
consolidated basis for the most recently completed Measurement Period.

 

“Consolidated
Net Income” means, at any date of determination, the net income (or loss)
of the Borrower and its Subsidiaries on a consolidated basis for the most
recently completed Measurement Period; provided that Consolidated Net
Income shall exclude (a) extraordinary gains and extraordinary losses for
such Measurement Period, (b) the net income of any Subsidiary during such
Measurement Period to the extent that the declaration or payment of dividends
or similar distributions by such Subsidiary of such income is not permitted by
operation of the terms of its Organization Documents or any agreement,
instrument or Law applicable to such Subsidiary during such Measurement Period,
except that the Borrower’s equity in any net loss of any such Subsidiary for
such Measurement Period shall be included in determining Consolidated Net
Income, and (c) any income (or loss) for such Period of any Person if such
Person is not a Subsidiary, except that the Borrower’s equity in the net income
of any such Person for such Measurement Period shall be included in
Consolidated Net Income up to the aggregate amount of cash actually distributed
by such Person during such Measurement Period to the Borrower or a Subsidiary
as a dividend or other distribution (and in the case of a dividend or other
distribution to a Subsidiary, such Subsidiary is not precluded from further
distributing such amount to the Borrower as described in clause (b) of
this proviso).

 

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

 

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

 

“Conversion
Date” means December 31, 2008; provided, if such day is not a
Business Day, the Conversion Date shall be the immediately preceding Business
Day.

 

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

 

5

 

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

 

“Default
Rate” means an interest rate equal to (i) the Base Rate plus (ii) the
Applicable Rate, if any, applicable to Base Rate Loans plus (iii) 2%
per annum; provided, however, that with respect to a Eurodollar
Rate Loan, the Default Rate shall be an interest rate equal to the interest
rate (including any Applicable Rate) otherwise applicable to such Loan plus 2%
per annum.

 

“Defaulting
Lender” means any Lender that (a) has failed to fund any portion of
the Loans required to be funded by it hereunder within one Business Day of the
date required to be funded by it hereunder unless such failure has been cured, (b) has
otherwise failed to pay over to Agent or any other Lender any other amount
required to be paid by it hereunder within one Business Day of the date when
due, unless the subject of a good faith dispute or unless such failure has been
cured, or (c) has been deemed insolvent or become the subject of a
bankruptcy or insolvency proceeding.

 

“Disposition”
or “Dispose” means the sale, transfer, license, lease or other
disposition (including any sale and leaseback transaction) of any property by
any Person, including any sale, assignment, transfer or other disposal, with or
without recourse, of any notes or accounts receivable or any rights and claims
associated therewith.

 

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

 

“Eligible
Assignee” means any Person that meets the requirements to be an assignee
under Section 11.06(b)(iii), (v) and (vi) (subject to such
consents, if any, as may be required under Section 11.06(b)(iii)).

 

“Environmental
Laws” means any and all Federal, state, local, and foreign statutes, laws,
regulations, ordinances, rules, judgments, orders, decrees, permits,
concessions, grants, franchises, licenses, agreements or governmental
restrictions relating to pollution and the protection of the environment or the
release of any materials into the environment, including those related to
hazardous substances or wastes, air emissions and discharges to waste or public
systems.

 

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

 

“Equity
Interests” means, with respect to any Person, all of the shares of capital
stock of (or other ownership or profit interests in) such Person, all of the
warrants, options or other rights for the purchase or acquisition from such
Person of shares of capital stock of (or other ownership 

 

6

 

or profit interests in) such Person, all of the
securities convertible into or exchangeable for shares of capital stock of (or
other ownership or profit interests in) such Person or warrants, rights or
options for the purchase or acquisition from such Person of such shares (or
such other interests), and all of the other ownership or profit interests in
such Person (including partnership, member or trust interests therein), whether
voting or nonvoting, and whether or not such shares, warrants, options, rights
or other interests are outstanding on any date of determination.

 

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

 

“ERISA
Affiliate” means any trade or business (whether or not incorporated) under
common control with Borrower within the meaning of Section 414(b) or (c) of
the Code (and Sections 414(m) and (o) of the Code for purposes of
provisions relating to Section 412 of the Code).

 

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

 

“Eurodollar
Base Rate” has the meaning specified in the definition of Eurodollar Rate.

 

“Eurodollar
Rate” means for any Interest Period with respect to a Eurodollar Rate Loan,
a rate per annum determined by Agent pursuant to the following formula:

 

	
  Eurodollar Rate  =

  	
  Eurodollar Base Rate

  
	
  1.00
  – Eurodollar Reserve Percentage

  

 

Where,

 

“Eurodollar Base Rate”
means, for such Interest Period the rate per annum equal to the British Bankers
Association LIBOR Rate (“BBA LIBOR”), as published by Reuters (or other
commercially available source providing quotations of BBA LIBOR as designated
by Agent from time to time) at approximately 11:00 a.m., London time, two
Business Days prior to the commencement of such Interest Period, for Dollar
deposits (for delivery on the first day of such Interest Period) with a term
equivalent to such Interest Period.  If
such rate is not available at such time for any reason, then the “Eurodollar
Base Rate” for such Interest Period shall be the rate per annum determined
by Agent to be the rate at which deposits in Dollars for delivery on the first
day of such 

 

7

 

Interest Period in
same day funds in the approximate amount of the Eurodollar Rate Loan being
made, continued or converted by Bank of America and with a term equivalent to
such Interest Period would be offered by Bank of America’s London Branch to
major banks in the London interbank eurodollar market at their request at
approximately 11:00 a.m. (London time) two Business Days prior to the
commencement of such Interest Period.

 

“Eurodollar Reserve
Percentage” means, for any day during any Interest Period, the reserve
percentage (expressed as a decimal, carried out to five decimal places) in
effect on such day, whether or not applicable to any Lender, under regulations
issued from time to time by the Board of Governors of the Federal Reserve
System of the United States for determining the maximum reserve requirement
(including any emergency, supplemental or other marginal reserve requirement)
with respect to Eurocurrency funding (currently referred to as “Eurocurrency
liabilities”).  The Eurodollar Rate for
each outstanding Eurodollar Rate Loan shall be adjusted automatically as of the
effective date of any change in the Eurodollar Reserve Percentage.

 

“Eurodollar
Rate Loan” means a Loan that bears interest at a rate based on the
Eurodollar Rate.

 

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

 

“Excluded
Taxes” means, with respect to Agent, any Lender or any other recipient of
any payment to be made by or on account of any obligation of Borrower
hereunder, (a) taxes imposed on or measured by its overall net income
(however denominated), and franchise taxes imposed on it (in lieu of net income
taxes), by the jurisdiction (or any political subdivision thereof) under the
laws of which such recipient is organized or in which its principal office is
located or, in the case of any Lender, in which its applicable Lending Office
is located, and (b) any branch profits taxes imposed by the United States
or any similar tax imposed by any other jurisdiction in which Borrower is
located.

 

“Facility”
means the Term Facility or the Revolving Credit Facility, as the context may
require.

 

“Federal
Funds Rate”   means, for any
day, the rate per annum equal to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers on such day, as published by the Federal Reserve Bank
of New York on the Business Day next succeeding such day; provided that (a) if
such day is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (b) if no such rate is
so published on such next succeeding Business Day, the Federal Funds Rate for such
day shall be the average rate (rounded upward, if necessary, to a whole
multiple of 1/100 of 1%) charged to Bank of America on such day on such
transactions as determined by Agent.

 

8

 

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

 

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

 

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

 

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

 

“Guarantee”
means, as to any Person, any (a) any obligation, contingent or otherwise,
of such Person guaranteeing or having the economic effect of guaranteeing any
Indebtedness or other obligation payable or performable by another Person (the “primary
obligor”) in any manner, whether directly or indirectly, and including any
obligation of such Person, direct or indirect, (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or
other obligation, (ii) to purchase or lease property, securities or
services for the purpose of assuring the obligee in respect of such
Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital,
equity capital or any other financial statement condition or liquidity or level
of income or cash flow of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation, or (iv) entered into
for the purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or (b) any
Lien on any assets of such Person securing any Indebtedness or other obligation
of any other Person, whether or not such Indebtedness or other obligation is
assumed by such Person (or any right, contingent or otherwise, of any holder of
such Indebtedness to obtain any such Lien). 
The amount of any Guarantee shall be deemed to be an amount equal to the
stated or determinable amount of the related primary obligation, or portion
thereof, in respect of which such Guarantee is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
as determined by the guaranteeing Person in good faith.  The term “Guarantee” as a verb has a
corresponding meaning.

 

“Guaranteed
Parties” means, collectively, the Administrative Agent, the Lenders, the
Hedge Banks, the Cash Management Banks, each co-agent or sub-agent appointed by
the Administrative Agent from time to time pursuant to Section 9.05, and
the other Persons the Obligations owing to which are or are purported to be
guaranteed by the Guaranty.

 

9

 

“Guarantors” means, collectively, Anika
Securities and each other Subsidiary of the Borrower that shall be required to
execute and deliver a guaranty, guaranty supplement or pledge of its equity
pursuant to Section 6.13.

 

“Guaranty” means the Guaranty made by the
Guarantors under Article X in favor of the Guaranteed Parties.

 

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

 

“Hedge
Agreement” means any interest rate Swap Contract permitted under Articles
VI and VII that is entered into by and between any Loan Party and any Hedge
Bank.

 

“Hedge
Bank” means any Person that, at the time it enters into a Hedge Agreement,
is a Lender or an Affiliate of a Lender, in its capacity as a party to such
Hedge Agreement.

 

“Indebtedness”
means, as to any Person at a particular time, without duplication, all of the
following, whether or not included as indebtedness or liabilities in accordance
with GAAP:

 

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

 

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

 

(c)           net obligations of such Person under
any Swap Contract;

 

(d)           all obligations of such Person to pay
the deferred purchase price of property or services (other than trade accounts
payable in the ordinary course of business and, in each case, not past due for
more than 90 days);

 

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

 

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

 

(g)           all obligations of such Person to
purchase, redeem, retire, defease or otherwise make any payment in respect of
any Equity Interest in such Person or any other Person, valued, in the case of
a redeemable preferred interest, at the greater of its voluntary or involuntary
liquidation preference plus accrued and unpaid dividends; and

 

10

 

(h)           all Guarantees of such Person in
respect of any of the foregoing.

 

For
all purposes hereof, the Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such Person
is a general partner or a joint venturer, unless such Indebtedness is expressly
made non-recourse to such Person.  The
amount of any net obligation under any Swap Contract on any date shall be
deemed to be the Swap Termination Value thereof as of such date.

 

“Indemnified
Taxes” means Taxes other than Excluded Taxes.

 

“Indemnitees”
has the meaning specified in Section 11.04(b).

 

“Information”
has the meaning specified in Section 11.07.

 

“Interest
Payment Date” means, (a) as to any Loan other than a Base Rate Loan,
the last day of each Interest Period applicable to such Loan and the Maturity
Date of the Facility under which such Loan was made; provided, however,
that if any Interest Period for a Eurodollar Rate Loan exceeds three months,
the respective dates that fall every three months after the beginning of such
Interest Period shall also be Interest Payment Dates; and (b) as to any
Base Rate Loan, the last Business Day of each March, June, September and December and the Maturity
Date of the Facility under which such Loan was made.

 

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

 

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

 

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

 

(iii)          no Interest Period shall extend beyond
the Maturity Date of the Facility under which such Loan was made.

 

“Investment”
means, as to any Person, any direct or indirect acquisition or investment by
such Person, whether by means of (a) the purchase or other acquisition of
capital stock or other securities of another Person, (b) a loan, advance
or capital contribution to, Guarantee or assumption of debt of, or purchase or
other acquisition of any other debt or equity participation or interest in,
another Person, including any partnership or joint venture interest in such
other Person and any arrangement pursuant to which the investor Guarantees
Indebtedness of such 

 

11

 

other Person, or (c) the purchase or other
acquisition (in one transaction or a series of transactions) of assets of
another Person that constitute a business unit. 
For purposes of covenant compliance, the amount of any Investment shall
be the amount actually invested, without adjustment for subsequent increases or
decreases in the value of such Investment.

 

“IRS”
means the United States Internal Revenue Service.

 

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

 

“Lender”
has the meaning specified in the introductory paragraph hereto.

 

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

 

“Lien”
means any mortgage, pledge, hypothecation, assignment, deposit arrangement,
encumbrance, lien (statutory or other), charge, or preference, priority or
other security interest or preferential arrangement in the nature of a security
interest of any kind or nature whatsoever (including any conditional sale or
other title retention agreement, any easement, right of way or other
encumbrance on title to real property, and any financing lease having
substantially the same economic effect as any of the foregoing).

 

“Loan”
means an extension of credit by a Lender to Borrower under Article II
in the form of a Revolving Credit Loan or a Term Loan.

 

“Loan
Documents” means, collectively, (a) this Agreement, (b) the
Notes, (c) each Hedge Agreement, (d) each Cash Management Agreement
and (e) each agreement executed and delivered to Agent pursuant to Section 6.13;
provided that for purposes of the definition of “Material Adverse Effect”
and Articles IV through IX, “Loan Documents” shall not include Hedge Agreements
or Cash Management Agreements.

 

“Loan
Parties” means, collectively, the Borrower and the Guarantors.

 

“Material
Adverse Effect” means (a) a material adverse change in, or a material
adverse effect upon, the operations, business, properties, liabilities (actual
or contingent) or condition (financial or otherwise) of Borrower and its
Subsidiaries, taken as a whole; (b) a material impairment of the ability
of any Loan Party to perform its obligations under any Loan Document to which
it is a party; or (c) a material adverse effect upon the legality,
validity, binding effect or enforceability against any Loan Party of any Loan
Document to which it is a party.

 

12

 

“Material
Contract” means, with respect to any Loan Party, each contract to which
such Person is a party involving aggregate consideration payable to or by such
Loan Party of an amount in excess of 20% of Borrower’s consolidated revenues
for its most recently completed fiscal year.

 

“Maturity
Date” means (a) with respect to the Revolving Credit Facility, the
last day of the Availability Period and (b) with respect to the Term
Facility, December 31, 2015; provided,
that if such date is not a Business Day, the Maturity Date shall be the
immediately succeeding Business Day.

 

“Measurement
Period” means, at any date of determination, the most recently completed
four fiscal quarters of the Borrower.

 

“Milestone
Payments” means payments received by a Loan Party under a long-term
customer contract for the achievement by such Loan Party of a specified event
and for which the revenue recognition treatment differs under GAAP and the
Code.

 

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

 

“Negotiation
Period” has the meaning set forth in Section 3.03.

 

“Note”
means a Revolving Credit Note or a Term Note, as the context may require.

 

“Obligations”
means all advances to, and debts, liabilities, obligations, covenants and
duties of, any Loan Party arising under any Loan Document or otherwise with
respect to any Loan, whether direct or indirect (including those acquired by
assumption), absolute or contingent, due or to become due, now existing or
hereafter arising and including interest and fees that accrue after the
commencement by or against any Loan Party or any Affiliate thereof of any
proceeding under any Debtor Relief Laws naming such Person as the debtor in
such proceeding, regardless of whether such interest and fees are allowed
claims in such proceeding.

 

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

 

“Other
Taxes” means all present or future stamp, intangible or documentary taxes
or any other excise or property taxes, charges or similar levies arising from
any payment made

 

13

 

hereunder or under any other Loan Document or from the
execution, delivery or enforcement of, or otherwise with respect to, this
Agreement or any other Loan Document.

 

“Outstanding
Amount” means with respect to Term Loans and Revolving Credit Loans on any
date, the aggregate outstanding principal amount thereof after giving effect to
any borrowings and prepayments or repayments of Term Loans and Revolving Credit
Loans, as the case may be, occurring on such date.

 

“Participant”
has the meaning specified in Section 11.06(d).

 

“PBGC”
means the Pension Benefit Guaranty Corporation.

 

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

 

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

 

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

 

“Platform”
has the meaning specified in Section 6.02.

 

“Principal
Payment Date” means the last Business Day of each March, June, September and
December, commencing with March 2009, and including the Maturity Date.

 

“Public
Lender” has the meaning specified in Section 6.02.

 

“Quick
Assets” means cash, short-term cash investments, net trade receivables and
marketable securities not classified as long-term investments.

 

“Rate
Determination Notice” has the meaning set forth in Section 3.03.

 

“Register”
has the meaning specified in Section 11.06(c).

 

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

 

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

 

14

 

“Required
Lenders” means, as of any date of determination, Lenders holding in the
aggregate at least 66 2/3 % of the sum of the (a) Total Outstandings and (b) aggregate
unused Revolving Credit Commitments; provided that the Commitment of,
and the portion of the Total Outstandings held or deemed held by, any
Defaulting Lender shall be excluded for purposes of making a determination of
Required Lenders.

 

“Responsible
Officer” means the chief executive officer, president, chief financial
officer, treasurer, assistant treasurer or controller
of a Loan Party and, solely for purposes of notices given pursuant to Article II,
any other officer or employee of the applicable Loan Party so designated by any
of the foregoing officers in a notice to Agent.    Any
document delivered hereunder that is signed by a Responsible Officer of a Loan
Party shall be conclusively presumed to have been authorized by all necessary
corporate, partnership and/or other action on the part of such Loan Party and
such Responsible Officer shall be conclusively presumed to have acted on behalf
of such Loan Party.

 

“Restricted
Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any capital stock or other Equity
Interest of Borrower or any Subsidiary, or any payment (whether in cash,
securities or other property), including any sinking fund or similar deposit,
on account of the purchase, redemption, retirement, acquisition, cancellation
or termination of any such capital stock or other Equity Interest or on account
of any return of capital to Borrower’s stockholders, partners or members (or
the equivalent Person thereof).

 

“Revolving
Credit Borrowing” means a borrowing consisting of simultaneous Revolving
Credit Loans of the same Type and, in the case of Eurodollar Rate Loans, having
the same Interest Period made by each of the Lenders pursuant to Section 2.01.

 

“Revolving
Credit Commitment” means, as to each Lender, its obligation to make
Revolving Credit Loans to the Borrower pursuant to Section 2.01 in
an aggregate principal amount at any one time outstanding not to exceed the
amount set forth opposite such Lender’s name on Schedule 2.01 under the
caption “Revolving Credit Commitment” or opposite such caption in the
Assignment and Assumption pursuant to which such Lender becomes a party hereto,
as applicable, as such amount may be adjusted from time to time in accordance
with this Agreement.  The aggregate
amount of the Revolving Credit Commitments of the Lenders as of the Closing
Date is $16,000,000.

 

“Revolving
Credit Facility” means, at any time, the aggregate amount of the Lenders’
Revolving Credit Commitments at such time.

 

“Revolving
Credit Loan” has the meaning specified in Section 2.01.

 

“Revolving
Credit Note” means a promissory note made by the Borrower in favor of a
Lender evidencing Revolving Credit Loans made by such Lender, substantially in
the form of Exhibit C-1.

 

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

 

15

 

“Subordinated
Liabilities” means liabilities subordinated to the Obligations in a manner
acceptable to Agent in its sole discretion.

 

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

 

“Substitute
Basis” has the meaning set forth in Section 3.03.

 

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

 

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

 

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

 

16

 

“Taxes”
means all present or future taxes, levies, imposts, duties, deductions,
assessments, fees or other charges imposed by any Governmental Authority,
including any interest, additions to tax or penalties applicable thereto.

 

“Term
Borrowing” means a Term-Out of Revolving Credit Loans into Term Loans of
the same Type on the same date and, in the case of Eurodollar Rate Loans,
having the same Interest Period effected by each of the Lenders pursuant to Section 2.03.

 

“Term
Commitment” means, as to each Lender, its obligation to Term-Out its
Revolving Credit Loans into Term Loans pursuant to Section 2.03 in
an aggregate principal amount at any one time outstanding not to exceed the
amount set forth opposite such Lender’s name on Schedule 2.01 under the
caption “Term Commitment” or opposite such caption in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable,
as such amount may be adjusted from time to time in accordance with this
Agreement.  The aggregate amount of the
Term Commitments of the Lenders as of the Closing Date is $16,000,000.

 

“Term
Facility” means, at any time, (a) at any time during the Availability
Period, the sum of (i) the aggregate amount of the Term Commitments at
such time and (ii) the aggregate principal amount of the Term Loans of all
Lenders outstanding at such time and (b) thereafter, the Outstanding
Amount of all Term Loans of all Lenders at such time.

 

“Term
Loan” has the meaning set forth in Section 2.03.

 

“Term
Note” means a promissory note made by the Borrower in favor of a Lender
evidencing Term Loans made by such Term Lender, substantially in the form of Exhibit C-2.

 

“Term-Out”
means, with respect to any Revolving Credit Loan, the conversion and
continuation of such Revolving Credit Loan as a Term Loan in accordance with Section 2.03.  The term “Term-Out” used as a verb shall have
a correlative meaning.

 

“Threshold
Amount” means $1,000,000.

 

“Total Current Liabilities” means, as at any date
of determination, the sum, for Borrower and its Subsidiaries (determined on a
consolidated basis without duplication in accordance with GAAP), of all current
liabilities that should, in accordance with GAAP, be classified as current
liabilities on the consolidated balance sheet of Borrower and its Subsidiaries
as at such date.

 

“Total
Revolving Credit Outstandings” means the aggregate Outstanding Amount of
all Revolving Credit Loans.

 

 “Total Outstandings” means the
aggregate Outstanding Amount of all Loans.

 

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

 

17

 

“Unfinanced
CapEx” means, for any period, Capital Expenditures for such period paid in
cash excluding (a) Capital Expenditures paid with proceeds of Indebtedness
for money borrowed (except for the Loans) incurred to finance such Capital
Expenditures, (b) Capital Expenditures financed by Indebtedness of the
kind referred to in clause (f) of the definition of “Indebtedness” with
respect to capital leases and (c) Capital Expenditures for the Bedford
Facility.

 

“Unfunded
Pension Liability” means the excess of a Pension Plan’s benefit liabilities
under Section 4001(a)(16) of ERISA, over the current value of that Pension
Plan’s assets, determined in accordance with the assumptions used for funding
the Pension Plan pursuant to Section 412 of the Code for the applicable
plan year.

 

“United
States” and “U.S.” mean the United States of America.

 

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

 

(a)           The
definitions of terms herein shall apply equally to the singular and plural
forms of the terms defined.  Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms.  The words “include,”
“includes” and “including” shall be deemed to be followed by the
phrase “without limitation.”  The word “will”
shall be construed to have the same meaning and effect as the word “shall.”  Unless the context requires otherwise, (i) any
definition of or reference to any agreement, instrument or other document
(including any Organization Document) shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein or in any other Loan
Document), (ii) any reference herein to any Person shall be construed to
include such Person’s successors and assigns, (iii) the words “herein,”
“hereof” and “hereunder,” and words of similar import when used
in any Loan Document, shall be construed to refer to such Loan Document in its
entirety and not to any particular provision thereof, (iv) all references
in a Loan Document to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
the Loan Document in which such references appear, (v) any reference to
any law shall include all statutory and regulatory provisions consolidating,
amending, replacing or interpreting such law and any reference to any law or
regulation shall, unless otherwise specified, refer to such law or regulation
as amended, modified or supplemented from time to time, and (vi) the words
“asset” and “property” shall be construed to have the same
meaning and effect and to refer to any and all tangible and intangible assets
and properties, including cash, securities, accounts and contract rights.

 

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

 

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

 

18

 

1.03         Accounting Terms.

 

(a)           Generally.
All accounting terms not specifically or completely defined herein shall be
construed in conformity with, and all financial data (including financial
ratios and other financial calculations) required to be submitted pursuant to
this Agreement shall be prepared in conformity with, GAAP applied on a
consistent basis, as in effect from time to time, applied in a manner
consistent with that used in preparing the Audited Financial Statements, except
as otherwise specifically prescribed herein.

 

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

 

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

 

1.05         Times of Day.  Unless otherwise specified, all references
herein to times of day shall be references to Eastern  time
(daylight or standard, as applicable).

 

ARTICLE II. THE COMMITMENTS
AND BORROWINGS

 

2.01         Revolving Credit Borrowings.  Subject to the terms and conditions set forth
herein, each Lender severally agrees to make loans (each such loan, a “Revolving
Credit Loan”) to Borrower from time to time, on any Business Day during the
Availability Period, in an aggregate amount not to exceed at any time
outstanding the amount of such Lender’s Revolving Credit Commitment; provided,
however, that after giving effect to any Revolving Credit Borrowing, (i) the
Total Revolving Credit Outstandings shall not exceed the Revolving Credit
Facility, (ii) the aggregate Outstanding Amount of the Revolving Credit
Loans of any Lender shall not exceed such Lender’s Revolving Credit Commitment
and (iii) the aggregate Outstanding Amount of all Loans of any Lender
shall not exceed such Lender’s Term Commitment. 
Within the limits of each Lender’s Revolving Credit Commitment, and
subject to the other terms and conditions hereof, Borrower may borrow and
reborrow during the Availability Period under this Section 2.01,
and prepay under Section 2.05. 
Revolving Credit Loans may be Base Rate Loans or Eurodollar Rate Loans,
as further provided herein.

 

19

 

2.02         Borrowings, Conversions and Continuations of Loans.

 

(a)           Each
Borrowing (including for avoidance of doubt each Term-Out of a Revolving Credit
Borrowing), each conversion of Loans from one Type to the other, and each
continuation of Eurodollar Rate Loans shall be made upon Borrower’s irrevocable
notice to Agent, which may be given by telephone.  Each such notice must be received by Agent
not later than 11:00 a.m. (i) two Business Days prior to the
requested date of any Borrowing of, conversion to or continuation of Eurodollar
Rate Loans or of any conversion of Eurodollar Rate Loans to Base Rate Loans,
and (ii) on the requested date of any Borrowing of Base Rate Loans.  Each telephonic notice by Borrower pursuant
to this Section 2.02(a) must be confirmed promptly by delivery
to Agent of a written Committed Loan Notice, appropriately completed and signed
by a Responsible Officer of Borrower. 
Each Borrowing of, conversion to or continuation of Eurodollar Rate
Loans shall be in a principal amount of $100,000 or a whole multiple of $100,000
in excess thereof.  Each Borrowing of or
conversion to Base Rate Loans shall be in a principal amount of $100,000 or a
whole multiple of $100,000 in excess thereof. 
Each Committed Loan Notice (whether telephonic or written) shall specify
(i) whether Borrower is requesting a Revolving Credit Borrowing, a Term
Borrowing, a conversion of Loans from one Type to the other, or a continuation
of Eurodollar Rate Loans, (ii) the requested date of the Borrowing,
conversion or continuation, as the case may be (which shall be a Business Day),
(iii) the principal amount of Loans to be borrowed, converted or
continued, (iv) the Type of Loans to be borrowed or to which existing
Revolving Credit Loans or Term Loans are to be converted, and (v) if
applicable, the duration of the Interest Period with respect thereto.  If Borrower fails to specify a Type of Loan
in a Committed Loan Notice or if Borrower fails to give a timely notice
requesting a conversion or continuation, then the applicable Loans shall be
made as, or converted to, Base Rate Loans. 
Any such automatic conversion to Base Rate Loans shall be effective as
of the last day of the Interest Period then in effect with respect to the
applicable Eurodollar Rate Loans.  If
Borrower requests a Borrowing of, conversion to, or continuation of Eurodollar
Rate Loans in any such Committed Loan Notice, but fails to specify an Interest
Period, it will be deemed to have specified an Interest Period of one month.

 

(b)           Following
receipt of a Committed Loan Notice, Agent shall promptly notify each Lender of
the amount of its Applicable Percentage under the applicable Facility of the
applicable Term Loans or Revolving Credit Loans, and if no timely notice of a
conversion or continuation is provided by Borrower, Agent shall notify each
Lender of the details of any automatic conversion to Base Rate Loans described
in the preceding subsection.  In the case
of a Revolving Credit Borrowing, each Lender shall make the amount of its Loan
available to Agent in immediately available funds at Administrative Agent’s
Office not later than 1:00 p.m. on the Business Day specified in the
applicable Committed Loan Notice.  Upon
satisfaction of the applicable conditions set forth in Section 4.02
(and, if such Borrowing is the initial Borrowing, Section 4.01),
Agent shall make all funds so received available to Borrower in like funds as
received by Agent either by (i) crediting the account of Borrower on the
books of Bank of America with the amount of such funds or (ii) wire
transfer of such funds, in each case in accordance with instructions provided
to (and reasonably acceptable to) Agent by Borrower.

 

(c)           Except
as otherwise provided herein, a Eurodollar Rate Loan may be continued or
converted only on the last day of an Interest Period for such Eurodollar Rate
Loan.  

 

20

 

During the existence of a
Default, no Loans may be requested as, converted to or continued as Eurodollar
Rate Loans without the consent of the Required Lenders, and the Required
Lenders may demand that any or all of the then outstanding Eurodollar Rate
Loans be converted immediately to Base Rate Loans and Borrower agrees to pay
all amounts due under Section 3.05 in accordance with the terms
thereof due to any such conversion.

 

(d)           Agent
shall promptly notify Borrower and Lenders of the interest rate applicable to
any Interest Period for Eurodollar Rate Loans upon determination of such
interest rate.

 

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

 

2.03         Term Borrowings. 
Each Lender severally agrees, on the terms and conditions of this
Agreement, (i) during the Availability Period and at Borrower’s request in
accordance with Section 2.02, to Term-Out all or any portion of its
outstanding Revolving Credit Loans so requested by Borrower (provided
that any such requested portion shall be in a principal amount of $100,000 or a
whole multiple of $100,000 in excess thereof), and to make a term loan to the
Borrower on the requested Term-Out date in an amount equal to such requested
principal amount of such Lender’s outstanding Revolving Credit Loans, and (ii) to
Term-Out its Revolving Credit Loans outstanding on the Conversion Date, and to
make a term loan (such Termed-Out Revolving Credit Loans and such term loans
made pursuant to clauses (i) and (ii) of this Section 2.03, the “Term
Loans”) to the Borrower on the Conversion Date in an amount equal to the
aggregate principal amount of such Lender’s Revolving Credit Loans outstanding
on the Conversion Date; provided, however, that after giving
effect to any Term Borrowing, the aggregate Outstanding Amount of the Term
Loans of any Lender shall not exceed such Lender’s Term Commitment.  Each Term-Out of Revolving Credit Loans shall
be deemed to be a Borrowing for all purposes of this Agreement; provided,
that Revolving Credit Loans that are Termed-Out by Term Loans shall not be
deemed to be repaid or discharged but shall be deemed to be continued as Term
Loans as provided hereby.  Amounts
Termed-Out, prepaid or repaid in respect of Term Loans may not be
reborrowed.  Term Loans may be Base Rate
Loans or Eurodollar Rate Loans, as provided herein.

 

2.04         [Reserved]

 

2.05         Prepayments.

 

(a)           Optional.  Borrower may, upon notice to Agent, at any
time or from time to time voluntarily prepay Loans in whole or in part without
premium or penalty; provided that (i) such notice must be received
by Agent not later than 11:00 a.m. (A) three Business Days prior to
any date of prepayment of Eurodollar Rate Loans and (B) on the date of
prepayment of Base Rate Loans; (ii) any prepayment of Eurodollar Rate
Loans shall be in a principal amount of $100,000 or a whole multiple of $100,000
in excess thereof; and (iii) any prepayment of Base Rate Loans shall be in
a principal amount of $100,000 or a whole multiple of $100,000 in excess
thereof or, in each case, if less, the entire principal amount thereof then
outstanding.  Each such 

 

21

 

notice shall specify the
date and amount of such prepayment and the Type(s) of Loans to be prepaid
and, if Eurodollar Rate Loans are to be prepaid, the Interest Period(s) of
such Loans.  Agent will promptly notify
each Lender of its receipt of each such notice, and of the amount of such
Lender’s Applicable Percentage of such prepayment.  If such notice is given by Borrower, Borrower
shall make such prepayment and the payment amount specified in such notice shall
be due and payable on the date specified therein.  Any prepayment of a Eurodollar Rate Loan
shall be accompanied by all accrued interest on the amount prepaid, together
with any additional amounts required pursuant to Section 3.05.  Each prepayment of the outstanding Term Loans
pursuant to this Section 2.05(a) shall be applied to the principal
repayment installments thereof in inverse order of maturity, and each such
prepayment shall be paid to the Lenders in accordance with their respective
Applicable Percentages in respect of each of the relevant Facilities.

 

(b)           Mandatory.  If
for any reason the Total Revolving Credit Outstandings at any time exceed the
Revolving Credit Facility at such time, Borrower shall immediately prepay
Revolving Credit Loans in an aggregate amount equal to such excess.

 

2.06         Termination or Reduction of Commitments.  Borrower may, upon notice to Agent, terminate
the Revolving Credit Facility, or from time to time permanently reduce the
Revolving Credit Facility; provided that (i) any such notice shall
be received by Agent not later than 11:00 a.m. five Business Days prior to
the date of termination or reduction, (ii) any such partial reduction
shall be in an aggregate amount of $1,000,000 or any whole multiple of
$1,000,000 in excess thereof, and (iii) Borrower shall not terminate or
reduce the Revolving Credit Facility if, after giving effect thereto and to any
concurrent prepayments hereunder, the Total Revolving Credit Outstandings would
exceed the Revolving Credit Facility.  Upon
any such termination or reduction of the Revolving Credit Facility during the
Availability Period, the Term Commitments shall also be automatically
terminated or reduced by an equal aggregate amount.  Agent will promptly notify the Lenders of any
such notice of termination or reduction of the Facilities.  Any reduction of the Aggregate Commitments
shall be applied to the Commitments of each Lender according to its Applicable
Percentage.  All fees accrued until the
effective date of any termination of the Aggregate Commitments shall be paid on
the effective date of such termination.

 

2.07         Repayment of Loans.

 

(a)           Revolving
Credit Loans.  Borrower hereby
unconditionally promises to pay to the Administrative Agent for account of the
Lenders on the Maturity Date for the Revolving Credit Facility the aggregate
principal amount of all Revolving Credit Loans outstanding on such date which
have not been Termed-Out pursuant to Section 2.03.

 

(b)           Term
Loans.  Borrower hereby
unconditionally promises to pay to the Administrative Agent for account of the
Lenders the outstanding principal amount of all Term Loans in twenty-eight (28)
equal, consecutive quarterly installments, calculated based on a ten-year
straight-line amortization for a seven-year term, one installment payable on
each Principal Payment Date; provided, that (i) the final
installment shall be in an amount equal to the then aggregate unpaid principal
amount of all Term Loans and (ii) the installments shall be reduced as 

 

22

 

a result of the application
of prepayments in accordance with the order of priority set forth in Section 2.05.  By way of illustration, if the aggregate
Outstanding Amount of all Term Loans is $16,000,000 as of the Conversion Date,
then the amount of each quarterly installment would be $400,000, with the final
installment equal to $5,200,000.

 

2.08         Interest.

 

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

 

(b)           (i)            If any amount of principal of any
Loan is not paid when due (without regard to any applicable grace periods),
whether at stated maturity, by acceleration or otherwise, such amount shall
thereafter bear interest at a fluctuating interest rate per annum at all times
equal to the Default Rate to the fullest extent permitted by applicable Laws.

 

(ii)           If any amount (other than principal
of any Loan) payable by Borrower under any Loan Document is not paid when due
(without regard to any applicable grace periods), whether at stated maturity,
by acceleration or otherwise, then upon the request of the Required Lenders,
such amount shall thereafter bear interest at a fluctuating interest rate per
annum at all times equal to the Default Rate to the fullest extent permitted by
applicable Laws.

 

(iii)          Upon the request of the Required
Lenders, while any Event of Default exists, Borrower shall pay interest on the
principal amount of all outstanding Obligations hereunder at a fluctuating
interest rate per annum at all times equal to the Default Rate to the fullest
extent permitted by applicable Laws.

 

(iv)          Accrued and unpaid interest on past
due amounts (including interest on past due interest) shall be due and payable
upon demand.

 

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

 

2.09         Fees.

 

(a)           Commitment
Fee. 
Borrower shall pay to Agent for the account of each Lender in
accordance with its Applicable Percentage, a commitment fee equal to the
Applicable Rate times the actual daily amount by which the Aggregate
Commitments exceed the Outstanding Amount of Loans.  The commitment fee shall accrue at all times
during the Availability Period, including at any time during which one or more
of the conditions in Article IV

 

23

 

is not met, and shall be due
and payable quarterly in arrears on the last Business Day of each March, June, September and December,
commencing with the first such date to occur after the Closing Date, and on the
last day of the Availability Period.  The
commitment fee shall be calculated quarterly in arrears, and if there is any
change in the Applicable Rate during any quarter, the actual daily amount shall
be computed and multiplied by the Applicable Rate separately for each period
during such quarter that such Applicable Rate was in effect.

 

(b)           Lenders’
Upfront Fee.  On the Closing Date,
Borrower shall pay to Agent, for the account of each Lender in accordance with
their respective Applicable Percentages, an upfront fee in an amount of
$50,000.  Such upfront fees are for the
credit facilities committed by Lenders under this Agreement and are fully
earned on the date paid.  The upfront fee
paid to each Lender is solely for its own account and is nonrefundable for any
reason whatsoever.

 

2.10         Computation of Interest and Fees.  All computations of interest for
Base Rate Loans when the Base Rate is determined by Bank of America’s “prime
rate” shall be made on the basis of a year of 365 or 366 days, as the case may
be, and actual days elapsed.  All other
computations of fees and interest shall be made on the basis of a 360-day year
and actual days elapsed (which results in more fees or interest, as applicable,
being paid than if computed on the basis of a 365-day year).  Interest shall accrue on each Loan for the
day on which the Loan is made, and shall not accrue on a Loan, or any portion
thereof, for the day on which the Loan or such portion is paid, provided
that any Loan that is repaid on the same day on which it is made shall, subject
to Section 2.12(a), bear interest for one day.  Each determination by Agent of an interest
rate or fee hereunder shall be conclusive and binding for all purposes, absent
manifest error.

 

2.11         Evidence of Debt. 
The Borrowings made by each Lender shall be evidenced by one or more
accounts or records maintained by such Lender and by Agent in the ordinary
course of business.  The accounts or
records maintained by Agent and each Lender shall be conclusive absent manifest
error of the amount of the Borrowings made by Lenders to Borrower and the
interest and payments thereon.  Any
failure to so record or any error in doing so shall not, however, limit or
otherwise affect the obligation of Borrower hereunder to pay any amount owing
with respect to the Obligations.  In the
event of any conflict between the accounts and records maintained by any Lender
and the accounts and records of Agent in respect of such matters, the accounts
and records of Agent shall control in the absence of manifest error.  Upon the request of any Lender made through
Agent, Borrower shall execute and deliver to such Lender (through Agent) a
Revolving Credit Note and/or Term Note, which shall evidence such Lender’s
Loans in addition to such accounts or records. 
Each Lender may attach schedules to its Notes and endorse thereon the
date, Type (if applicable), amount and maturity of its Loans and payments with
respect thereto.

 

2.12         Payments Generally; Agent’s Clawback.

 

(a)           General.

 

(i)            All
payments to be made by Borrower shall be made without condition or deduction for
any counterclaim, defense, recoupment or setoff.  Except as otherwise 

 

24

 

expressly provided herein,
all payments by Borrower hereunder shall be made to Agent, for the account of
the respective Lenders to which such payment is owed, at the Administrative
Agent’s Office in Dollars and in immediately available funds not later than
12:00 noon on the date specified herein. 
Agent will promptly distribute to each Lender its Applicable Percentage
(or other applicable share as provided herein) of such payment in like funds as
received by wire transfer to such Lender’s Lending Office.  All payments received by Agent after 12:00
noon shall be deemed received on the next succeeding Business Day and any
applicable interest or fee shall continue to accrue.  If any payment to be made by Borrower shall
come due on a day other than a Business Day, payment shall be made on the next
following Business Day, and such extension of time shall be reflected in
computing interest or fees, as the case may be.

 

(ii)           On
each date when the payment of any principal, interest or fees are due hereunder
or under any Note, Borrower agrees to maintain on deposit in an ordinary
checking account maintained by Borrower with Agent (as such account shall be
designated by Borrower in a written notice to Agent from time to time, the “Borrower
Account”) an amount sufficient to pay such principal, interest or fees in
full on such date.  Borrower hereby
authorizes Agent (A) to deduct automatically all principal, interest or
fees when due hereunder or under any Note from the Borrower Account, and (B) if
and to the extent any payment of principal, interest or fees under this
Agreement or any Note is not made when due to deduct any such amount from any or
all of the accounts of Borrower maintained at Agent.  Agent agrees to provide written notice to
Borrower of any automatic deduction made pursuant to this Section 2.12(a)(ii) showing
in reasonable detail the amounts of such deduction.  Lenders agree to reimburse Borrower based on
their Applicable Percentage for any amounts deducted from such accounts in
excess of amount due hereunder and under any other Loan Documents.

 

(b)           (i) 
Funding by Lenders; Presumption by Agent.  Unless Agent shall have received notice from
a Lender prior to the proposed date of any Borrowing of Eurodollar Rate Loans
(or, in the case of any Borrowing of Base Rate Loans, prior to 12:00 noon on
the date of such Borrowing) that such Lender will not make available to Agent
such Lender’s share of such Borrowing, Agent may assume that such Lender has
made such share available on such date in accordance with Section 2.02
(or, in the case of a Borrowing of Base Rate Loans, that such Lender has made
such share available in accordance with and at the time required by Section 2.02)
and may, in reliance upon such assumption, make available to Borrower a
corresponding amount.  In such event, if
a Lender has not in fact made its share of the applicable Borrowing available
to Agent, then the applicable Lender and Borrower severally agree to pay to
Agent forthwith on demand such corresponding amount in immediately available
funds with interest thereon, for each day from and including the date such
amount is made available to Borrower to but excluding the date of payment to
Agent, at (A) in the case of a payment to be made by such Lender, the
greater of the Federal Funds Rate and a rate determined by Agent in accordance
with banking industry rules on interbank compensation, plus any
administrative, processing or similar fees customarily charged by Agent in
connection with the foregoing and (B) in the case of a payment to be made
by Borrower, the interest rate applicable to Base Rate Loans.  If Borrower and such Lender shall pay such
interest to Agent for the same or an overlapping period, Agent shall promptly
remit to Borrower the amount of such interest paid by Borrower for such
period.  If such Lender pays its share of
the applicable Borrowing to Agent, then the amount so paid shall constitute
such Lender’s Loan included in such Borrowing. 
Any payment by Borrower shall be 

 

25

 

without prejudice to any claim Borrower may have against a Lender that
shall have failed to make such payment to Agent.

 

(ii)           Payments by Borrower; Presumptions
by Agent.  Unless Agent shall have
received notice from Borrower prior to the date on which any payment is due to
Agent for the account of the Lenders hereunder that Borrower will not make such
payment, Agent may assume that Borrower has made such payment on such date in
accordance herewith and may, in reliance upon such assumption, distribute to
Lenders the amount due.  In such event,
if Borrower has not in fact made such payment, then each of Lenders severally
agrees to repay to Agent forthwith on demand the amount so distributed to such
Lender in immediately available funds with interest thereon, for each day from
and including the date such amount is distributed to it to but excluding the
date of payment to Agent, at the greater of the Federal Funds Rate and a rate
determined by Agent in accordance with banking industry rules on interbank
compensation.  A notice of Agent to any
Lender or Borrower with respect to any amount owing under this subsection (b) shall
be conclusive, absent manifest error.

 

(c)           Failure
to Satisfy Conditions Precedent.  If
any Lender makes available to Agent funds for any Loan to be made by such
Lender as provided in the foregoing provisions of this Article II,
and such funds are not made available to Borrower by Agent because the
conditions to the applicable Borrowing set forth in Article IV are
not satisfied or waived in accordance with the terms hereof, Agent shall return
such funds (in like funds as received from such Lender) to such Lender, without
interest.

 

(d)           Obligations
of Lenders Several.  The obligations
of Lenders hereunder to make Loans and to make payments under Section 11.04(c) 
are several and not joint.  The failure
of any Lender to make any Loan or to make any payment under Section 11.04(c) on
any date required hereunder shall not relieve any other Lender of its
corresponding obligation to do so on such date, and no Lender shall be
responsible for the failure of any other Lender to so make its Loan or to make
its payment under Section 11.04(c):

 

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

 

2.13         Sharing of Payments. 
If any Lender shall, by exercising any right of setoff or counterclaim
or otherwise, obtain payment in respect of any principal of or interest on any
of the Loans made by it resulting in such Lender’s receiving payment of a
proportion of the aggregate amount of such Loans and accrued interest thereon
greater than its pro  rata share thereof as provided herein, then
the Lender receiving such greater proportion shall (a) notify Agent of
such fact, and (b) purchase (for cash at face value) participations in the
Loans of the other Lenders, or make such other adjustments as shall be
equitable, so that the benefit of all such payments shall be shared by the
Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Loans and other amounts owing them, provided
that:

 

26

 

(i)            if
any such participations are purchased and all or any portion of the payment
giving rise thereto is recovered, such participations shall be rescinded and
the purchase price restored to the extent of such recovery, without interest;
and

 

(ii)           the
provisions of this Section shall not be construed to apply to (x) any
payment made by Borrower pursuant to and in accordance with the express terms
of this Agreement or (y) any payment obtained by a Lender as consideration
for the assignment of or sale of a participation in any of its Loans to any
assignee or participant, other than to Borrower or any Subsidiary thereof (as
to which the provisions of this Section shall apply).

 

Each
Loan Party consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against such
Loan Party rights of setoff and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of such Loan Party in the
amount of such participation.

 

ARTICLE III.        TAXES, YIELD PROTECTION AND ILLEGALITY

 

3.01         Taxes.

 

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

 

(b)           Payment
of Other Taxes by Borrower.  Without
limiting the provisions of subsection (a) above, Borrower shall timely pay
any Other Taxes to the relevant Governmental Authority in accordance with
applicable law.

 

(c)           Indemnification
by Borrower.   Borrower shall
indemnify Agent and each Lender within 10 Business Days after demand therefor,
for the full amount of any Indemnified Taxes or Other Taxes (including
Indemnified Taxes or Other Taxes imposed or asserted on or attributable to
amounts payable under this Section) paid by Agent or such Lender, as the case
may be, and any penalties, interest and reasonable expenses arising therefrom
or with respect thereto, whether or not such Indemnified Taxes or Other Taxes
were correctly or legally imposed or asserted by the relevant Governmental
Authority.  A certificate (in reasonable
detail) as to the amount of such payment or liability delivered to Borrower by
a Lender (with a copy to Agent), or by Agent on its own behalf or on behalf of
a Lender, shall be conclusive absent manifest error.

 

27

 

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

 

(e)           Status
of Lenders.  Any Lender, if requested
by Borrower or Agent, shall deliver such documentation prescribed by applicable
law or reasonably requested by Borrower or Agent as will enable Borrower or
Agent to determine whether or not such Lender is subject to backup withholding
or information reporting requirements.

 

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

 

3.02         Illegality.  If any Lender determines that any Law has
made it unlawful, or that any Governmental Authority has asserted that it is
unlawful, for any Lender or its applicable Lending Office to make, maintain or
fund Eurodollar Rate Loans, or to determine or charge interest rates based upon
the Eurodollar Rate, or any Governmental Authority has imposed material
restrictions on the authority of such Lender to purchase or sell, or to take
deposits of, Dollars in the London interbank market, then, on notice thereof by
such Lender to Borrower through Agent, any obligation of such Lender to make or
continue Eurodollar Rate Loans or to convert Base Rate Loans to Eurodollar Rate
Loans shall be suspended until such Lender notifies Agent and Borrower that the
circumstances giving rise to such determination no longer exist.  Upon receipt of such notice, Borrower shall,
upon demand from such Lender (with a copy to Agent), prepay or, if applicable,
convert all Eurodollar Rate Loans of such Lender to Base Rate Loans, either on
the last day of the Interest Period therefor, if such Lender may lawfully
continue to maintain such Eurodollar Rate Loans to such day, or immediately, if
such Lender may not lawfully continue to maintain such Eurodollar Rate
Loans.  Upon any such prepayment or
conversion, Borrower shall also pay accrued interest on the amount so prepaid
or converted and all amounts due under Section 3.05 in accordance
with the terms thereof due to such prepayment or conversion.

 

3.03         Inability to Determine Rates.  If Agent determines in connection with any
request for a Eurodollar Rate Loan or a conversion to or continuation thereof
that (a) Dollar deposits are 

 

28

 

not being offered to banks in the London interbank
eurodollar market for the applicable amount and Interest Period of such
Eurodollar Rate Loan, (b) adequate and reasonable means do not exist for
determining the Eurodollar Base Rate for any requested Interest Period with
respect to a proposed Eurodollar Rate Loan, or (c) the Eurodollar Base
Rate for any requested Interest Period with respect to a proposed Eurodollar
Rate Loan does not adequately and fairly reflect the cost to such Lenders of
funding such Loan, Agent will promptly so notify (such notice, a “Rate
Determination Notice”) Borrower and each Lender.  Thereafter, the obligation of Lenders to make
or maintain Eurodollar Rate Loans shall be suspended until Agent (upon the
instruction of the Required Lenders) revokes such notice.  If such notice is given, during the 30-day
period following such Rate Determination Notice (the “Negotiation Period”),
Agent and Borrower will negotiate in good faith with a view to agreeing upon a
substitute interest rate basis (having the written approval of the Required
Lenders) for the Interest Period(s) to which such Rate Determination
Notice relates which shall reflect the cost to the Lenders of funding such
Loans from alternative sources (a “Substitute Basis”), and if such
Substitute Basis is so agreed upon during the Negotiation Period, such
Substitute Basis shall apply in lieu of the Eurodollar Rate to the Interest
Period(s) to which such Rate Determination Notice relates, until the
circumstances giving rise to such notice have ceased to apply.  If a Substitute Basis is not agreed upon
during the Negotiation Period, Borrower may elect to prepay the affected Loans
pursuant to Section 2.05(a); provided, that if Borrower does not
elect to so prepay, then (i) the affected Loans shall bear interest at a
rate per annum equal to the Base Rate plus the Applicable Rate from and after
the first day of the affected Interest Period to which such Rate Determination
Notice relates, payable in accordance with Section 2.08, and (ii) Borrower
may revoke any pending request for a Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or, failing that, Borrower will be deemed
to have converted such request into a request for a Borrowing of Base Rate
Loans in the amount specified therein.

 

3.04         Increased Costs.

 

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

 

(i)            impose,
modify or deem applicable any reserve, special deposit, compulsory loan,
insurance charge or similar requirement against assets of, deposits with or for
the account of, or credit extended or participated in by, any Lender (except
any reserve requirement reflected in the Eurodollar Rate);

 

(ii)           subject
any Lender to any tax of any kind whatsoever with respect to this Agreement or
any Eurodollar Rate Loan made by it, or change the basis of taxation of
payments to such Lender in respect thereof (except for Indemnified Taxes or
Other Taxes covered by Section 3.01 and the imposition of, or any
change in the rate of, any Excluded Tax payable by such Lender); or

 

(iii)          impose
on any Lender or the London interbank market any other condition, cost or expense
affecting this Agreement or Eurodollar Rate Loans made by such Lender;

 

29

 

and
the result of any of the foregoing shall be to increase the cost to such Lender
of making or maintaining any Eurodollar Rate Loan (or of maintaining its
obligation to make any such Loan), or to reduce the amount of any sum received
or receivable by such Lender hereunder (whether of principal, interest or any
other amount) then, upon request of such Lender, Borrower will pay to such
Lender such additional amount or amounts as will compensate such Lender for
such additional costs incurred or reduction suffered.

 

(b)           Capital
Requirements.  If any Lender
determines that any Change in Law affecting such Lender or any Lending Office
of such Lender or such Lender’s holding company, if any, regarding capital
requirements has or would have the effect of reducing the rate of return on
such Lender’s capital or on the capital of such Lender’s holding company, if
any, as a consequence of this Agreement, the Commitments of such Lender or the
Loans made by such Lender to a level below that which such Lender or such
Lender’s holding company could have achieved but for such Change in Law (taking
into consideration such Lender’s policies and the policies of such Lender’s
holding company with respect to capital adequacy), then from time to time, upon
request of such Lender, Borrower will pay to such Lender such additional amount
or amounts as will compensate such Lender or such Lender’s holding company for
any such reduction suffered.

 

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

 

(d)           Delay
in Requests.  Failure or delay on the
part of any Lender to demand compensation pursuant to the foregoing provisions
of this Section shall not constitute a waiver of such Lender’s right to
demand such compensation, provided that Borrower shall not be required
to compensate a Lender pursuant to the foregoing provisions of this Section for
any increased costs incurred or reductions suffered more than nine months prior
to the date that such Lender notifies Borrower of the Change in Law giving rise
to such increased costs or reductions and of such Lender’s intention to claim
compensation therefor (except that, if the Change in Law giving rise to such
increased costs or reductions is retroactive, then the nine-month period
referred to above shall be extended to include the period of retroactive effect
thereof).

 

3.05         Compensation for Losses.  Upon demand of any Lender (with a copy to
Agent) from time to time, Borrower shall promptly compensate such Lender for
and hold such Lender harmless from any loss, cost or expense incurred by it as
a result of:

 

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

 

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

 

30

 

including
any loss of anticipated profits and any loss or expense arising from the
liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were
obtained.  Borrower shall also pay any
customary administrative fees charged by such Lender in connection with the
foregoing.  For purposes of calculating
amounts payable by Borrower to Lenders under this Section 3.05,
each Lender shall be deemed to have funded each Eurodollar Rate Loan made by it
at the Eurodollar Base Rate used in determining the Eurodollar Rate for such
Loan by a matching deposit or other borrowing in the London interbank
eurodollar market for a comparable amount and for a comparable period, whether
or not such Eurodollar Rate Loan was in fact so funded.

 

3.06         Mitigation Obligations.  If any Lender requests compensation under Section 3.04,
or Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 3.01,
or if any Lender gives a notice pursuant to Section 3.02, then such
Lender shall use reasonable efforts to designate a different Lending Office for
funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or affiliates, if, in the
judgment of such Lender, such designation or assignment (i) would
eliminate or reduce amounts payable pursuant to Section 3.01 or 3.04,
as the case may be, in the future, or eliminate the need for the notice
pursuant to Section 3.02, as applicable, and (ii) in each
case, would not subject such Lender to any unreimbursed cost or expense and
would not otherwise be disadvantageous to such Lender.  Borrower hereby agrees to pay all reasonable
costs and expenses incurred by any Lender in connection with any such
designation or assignment.

 

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

 

ARTICLE IV.        CONDITIONS PRECEDENT TO BORROWINGS

 

4.01         Conditions of Initial Borrowing.  The obligation of each Lender to make its
initial Borrowing hereunder is subject to satisfaction of the following
conditions precedent:

 

(a)           Agent’s
receipt of the following, each of which shall be originals or telecopies
(followed promptly by originals) unless otherwise specified, each properly
executed by a Responsible Officer of the signing Loan Party, each dated the
Closing Date (or, in the case of certificates of governmental officials, a
recent date before the Closing Date) and each in form and substance
satisfactory to Agent and each of the Lenders:

 

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

 

(ii)           a
Revolving Credit Note executed by Borrower in favor of each Lender requesting
such a Note;

 

(iii)          such
certificates of resolutions or other action, incumbency certificates and/or
other certificates of Responsible Officers of each Loan Party as Agent may
require evidencing the identity, authority and capacity of each Responsible
Officer thereof 

 

31

 

authorized to act as a Responsible Officer in connection with this Agreement
and the other Loan Documents to which such Loan Party is a party;

 

(iv)          such
documents and certifications as Agent may reasonably require to evidence that
each Loan Party is duly organized or formed, and that each Loan Party is
validly existing, in good standing and qualified to engage in business in each
jurisdiction where its ownership, lease or operation of properties or the
conduct of its business requires such qualification, except to the extent that
failure to do so could not reasonably be expected to have a Material Adverse
Effect;

 

(v)           a
favorable opinion of counsel to the Loan Parties acceptable to Agent addressed
to Agent and each Lender, as to the matters set forth concerning the Loan
Parties and the Loan Documents in form and substance satisfactory to Agent;

 

(vi)          a
certificate of a Responsible Officer of each Loan Party either (A) attaching
copies of all consents, licenses and approvals required in connection with the
execution, delivery and performance by such Loan Party and the validity against
such Loan Party of the Loan Documents to which it is a party, and such
consents, licenses and approvals shall be in full force and effect, or (B) stating
that no such consents, licenses or approvals are so required;

 

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

 

(viii)        evidence
that all insurance required to be maintained pursuant to the Loan Documents has
been obtained and is in effect;

 

(ix)           a
duly completed Compliance Certificate as of the last day of the fiscal quarter
of Borrower most recently ended prior to the Closing Date, signed by a
Responsible Officer of Borrower; and

 

(x)            such
other assurances, certificates, documents, consents or opinions as Agent or the
Required Lenders reasonably may require.

 

(b)           Any
fees required to be paid on or before the Closing Date shall have been paid.

 

(c)           Unless
waived by Agent, Borrower shall have paid all fees, charges and disbursements
of counsel to Agent (directly to such counsel if requested by Agent) to the
extent invoiced prior to or on the Closing Date, plus such additional amounts
of such fees, charges and disbursements as shall constitute its reasonable
estimate of such fees, charges and disbursements incurred or to be incurred by
it through the closing proceedings (provided that such estimate shall not
thereafter preclude a final settling of accounts between Borrower and Agent).

 

(d)           The
Closing Date shall have occurred on or before February 1, 2008.

 

32

 

Without
limiting the generality of the provisions of the last sentence of Section 9.03(d),
for purposes of determining compliance with the conditions specified in this Section 4.01,
each Lender that has signed this Agreement shall be deemed to have consented
to, approved or accepted or to be satisfied with, each document or other matter
required thereunder to be consented to or approved by or acceptable or
satisfactory to a Lender unless Agent shall have received notice from such
Lender prior to the proposed Closing Date specifying its objection thereto.

 

4.02         Conditions to all Borrowings.  The obligation of each Lender to honor any
Committed Loan Notice is subject to the following conditions precedent:

 

(a)           The
representations and warranties of Borrower and each other Loan Party contained
in Article V or any other Loan Document, or which are contained in
any document furnished at any time under or in connection herewith or
therewith, shall be true and correct in all material respects (except that any
representation and warranty that is qualified as to “materiality” or “Material
Adverse Effect” shall be true and correct in all respects) on and as of the
date of such Borrowing, except to the extent that such representations and
warranties specifically refer to an earlier date, in which case they shall be
true and correct as of such earlier date, and except that for purposes of this Section 4.02,
the representations and warranties contained in subsections (a) and (b) of
Section 5.05 shall be deemed to refer to the most recent statements
furnished pursuant to clauses (a) and (b), respectively, of Section 6.01.

 

(b)           No
Default shall exist, or would result from such proposed Borrowing or from the
application of the proceeds thereof.

 

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

 

(d)           Agent
shall have received, in form and substance satisfactory to it, such other
assurances, certificates, documents or consents related to the foregoing as
Agent or the Required Lenders reasonably may require.

 

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

 

ARTICLE V.         REPRESENTATIONS AND WARRANTIES

 

                Each Loan Party represents and
warrants to Agent and the Lenders that:

 

5.01         Existence, Qualification and Power.  Such Loan Party (a) is duly organized or
formed, validly existing and, as applicable, in good standing under the Laws of
the jurisdiction of its incorporation or organization, (b) has all
requisite power and authority and all requisite governmental licenses,
authorizations, consents and approvals to (i) own or lease its assets and
carry on its business and (ii) execute, deliver and perform its
obligations under the Loan Documents to which it is a party, and (c) is
duly qualified and is licensed and, as applicable, in good standing under the
Laws of each jurisdiction where its ownership, lease or operation of

 

33

 

properties
or the conduct of its business requires such qualification or license; except
in each case referred to in clause (b)(i), or (c), to the extent that failure
to do so could not reasonably be expected to have a Material Adverse Effect.

 

5.02         Authorization; No Contravention.  The execution, delivery and performance by
such Loan Party of each Loan Document to which such Loan Party is party, have
been duly authorized by all necessary corporate or other organizational action,
and do not and will not (a) contravene the terms of any of such Loan Party’s
Organization Documents; (b) conflict with or result in any breach or
contravention of, or the creation of any Lien under, or require any payment to
be made under (i) any material Contractual Obligation to which such Loan
Party is a party or affecting such Loan Party or its properties or (ii) any
order, injunction, writ or decree of any Governmental Authority or any arbitral
award to which such Loan Party or its property is subject; or (c) violate
any Law in any material respect.

 

5.03         Governmental Authorization; Other Consents.  No approval,
consent, exemption, authorization, or other action by, or notice to, or filing
with, any Governmental Authority or any other Person is necessary or required
in connection with the execution, delivery or performance by, or enforcement
against, such Loan Party of this Agreement or any other Loan Document to which
such Loan Party is party, except for those which have been duly obtained,
taken, given or made and are in full force and effect.

 

5.04         Binding Effect.  This Agreement has been, and each other Loan
Document, when delivered hereunder, will have been, duly executed and delivered
by such Loan Party that is party thereto. 
This Agreement constitutes, and each other Loan Document to which such
Loan Party is party when so delivered will constitute, a legal, valid and
binding obligation of such Loan Party, enforceable against such Loan Party in
accordance with its terms, subject to (i) applicable bankruptcy,
insolvency, moratorium, fraudulent transfer and other laws affecting creditors’
rights generally and (ii) general principles of equity, regardless of
whether considered in a proceeding at law or in equity.

 

5.05         Financial Statements; No Material Adverse Effect.

 

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

 

(b)           The unaudited consolidated balance sheets of Borrower and
its Subsidiaries dated June 30,
2007 and September 30, 2007, and the related consolidated
statements of income or operations, shareholders’ equity and cash flows for the
fiscal quarters ended on such dates (i) were prepared in accordance with
GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein, and (ii) fairly present in 

 

34

 

all
material respects the financial condition of Borrower and its Subsidiaries as
of the dates thereof and their results of operations for the periods covered
thereby, subject, in the case of clauses (i) and (ii), to the absence of
footnotes and to normal year-end audit adjustments.

 

(c)           Except as set forth in the most recent annual, audited
financial statements described in Section 5.05(a) or (b) or
delivered pursuant to Section 6.01(a), since the date of the Audited
Financial Statements (or, if later, the last day of the fiscal year covered by
the most recent annual, audited financial statements delivered pursuant to Section 6.01(a)),
there has been no event or circumstance, either individually or in the
aggregate, that has had or could reasonably be expected to have a Material
Adverse Effect.

 

(d)           The consolidated five-year financial forecasts, balance
sheet forecast and cash flow projections of Borrower and its Subsidiaries as at
January 10, 2008, delivered to Agent (copies of which have been furnished
to each Lender), and the annual budget and projections delivered pursuant to Section 6.01(c),
were prepared in good faith on the basis of the assumptions stated therein,
which assumptions were reasonable in light of the conditions existing at the
time of delivery of such forecasts, and represented, at the time of delivery,
Borrower’s good faith estimate of its future financial condition and
performance.

 

5.06         Litigation.  There are no actions, suits, proceedings,
claims or disputes pending or, to the knowledge of such Loan Party, threatened
or contemplated, at law, in equity, in arbitration or before any Governmental
Authority, by or against such Loan Party or against any of its properties or
revenues that (a) purport to affect or pertain to this Agreement or any
other Loan Document, or any of the transactions contemplated hereby, or (b) except
as specifically disclosed in Schedule 5.06, either individually or in
the aggregate, if determined adversely, could reasonably be expected to have a
Material Adverse Effect, and there has been no adverse change in the status, or
financial effect on such Loan Party, of the matters described on Schedule
5.06.

 

5.07         No Default.  Such Loan Party is not in default under or
with respect to any Contractual Obligation that could, either individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect.  No Default has occurred and is continuing or
could reasonably be expected to result from the consummation of the
transactions contemplated by this Agreement or any other Loan Document.

 

5.08         Ownership of Property; Liens.  Such Loan Party has good and marketable title
to, or valid leasehold interests in, all real property necessary or used in the
ordinary conduct of its business, except for such defects in title as could
not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.  The property of
such Loan Party is subject to no Liens, other than Liens permitted by Section 7.01.

 

5.09         Environmental Compliance.  Except as specifically disclosed in Schedule
5.09, such Loan Party is not in violation of applicable Environmental Laws
in any material respect, and no claims alleging potential liability or
responsibility for violation of any Environmental Law which could, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect
are pending or, to such Loan Party’s knowledge, threatened against such Loan
Party or any of its properties.

 

35

 

5.10         Insurance.  The properties of such Loan Party are insured
with financially sound and reputable insurance companies not Affiliates of such
Loan Party, in such amounts (after giving effect to any self-insurance
compatible with the following standards), with such deductibles and covering
such risks as are customarily carried by companies engaged in similar businesses
and owning similar properties in localities where such Loan Party operates.

 

5.11         Taxes.  Such Loan Party has filed all Federal, state
and other material tax returns and reports required to be filed, and has paid
all Federal, state and other material taxes, assessments, fees and other
governmental charges levied or imposed upon it or its properties, income or
assets otherwise due and payable, except those which are being contested in
good faith by appropriate proceedings diligently conducted and for which
adequate reserves have been provided in accordance with GAAP.  To the best of such Loan Party’s knowledge,
there is no proposed tax assessment against such Loan Party that would, if
made, have a Material Adverse Effect.

 

5.12         ERISA Compliance.

 

(a)           Each Plan is in compliance in all material respects with
the applicable provisions of ERISA, the Code and other Federal or state
Laws.  Each Plan that is intended to
qualify under Section 401(a) of the Code has received a favorable
determination letter from the IRS or an application for such a letter is
currently being processed by the IRS with respect thereto and, to the knowledge
of such Loan Party, nothing has occurred which would prevent, or cause the loss
of, such qualification.  Such Loan Party
and each ERISA Affiliate have made all required contributions to each Plan
subject to Section 412 of the Code, and no application for a funding
waiver or an extension of any amortization period pursuant to Section 412
of the Code has been made with respect to any Plan.

 

(b)           There are no pending or, to the knowledge of such Loan
Party, threatened claims, actions or lawsuits, or action by any Governmental
Authority, with respect to any Plan that could be reasonably be expected to
have a Material Adverse Effect.  There
has been no prohibited transaction or violation of the fiduciary responsibility
rules with respect to any Plan that has resulted or could reasonably be
expected to result in a Material Adverse Effect.

 

(c)           (i)  No ERISA Event has occurred or could reasonably
be expected to occur; (ii) no Pension Plan has any Unfunded Pension
Liability; (iii) neither such Loan Party nor any ERISA Affiliate has
incurred, or reasonably expects to incur, any liability under Title IV of ERISA
with respect to any Pension Plan (other than premiums due and not delinquent
under Section 4007 of ERISA); (iv) neither such Loan Party nor any
ERISA Affiliate has incurred, or reasonably expects to incur, any liability
(and no event has occurred which, with the giving of notice under Section 4219
of ERISA, would result in such liability) under Section 4201 or 4243 of
ERISA with respect to a Multiemployer Plan; and (v) neither such Loan
Party nor any ERISA Affiliate has engaged in a transaction that could be
subject to Section 4069 or 4212(c) of ERISA.

 

5.13         Subsidiaries.  As of the Closing Date, such Loan Party has
no Subsidiaries other than those specifically disclosed in Part (a) of
Schedule 5.13, and all of the outstanding Equity Interests in such
Subsidiaries have been validly issued, are fully paid and nonassessable and are

 

36

 

owned
by a Loan Party in the amounts specified on Part (a) of Schedule
5.13 free and clear of all Liens. 
Such Loan Party has no equity investments or joint venture investments
in any other corporation or entity other than those specifically disclosed in Part (b) of
Schedule 5.13.  All of the
outstanding Equity Interests in such Loan Party have been validly issued and
are fully paid and nonassessable and, with respect to 100% of the Equity
Securities of each Guarantor, are owned by the Borrower free and clear of all
Liens.

 

5.14         Margin Regulations; Investment Company Act.

 

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

 

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

 

5.15         Disclosure.  Such Loan Party has disclosed to Agent and
Lenders all agreements, instruments and corporate or other restrictions to
which it is subject, and all other matters known to it, that, individually or
in the aggregate, could reasonably be expected to result in a Material Adverse
Effect.  No report, financial statement,
certificate or other information furnished (whether in writing or orally) by or
on behalf of any Loan Party to Agent or any Lender in connection with the
transactions contemplated hereby and the negotiation of this Agreement or
delivered hereunder or under any other Loan Document (in each case, as modified
or supplemented by other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided that, with respect to projected financial
information, such Loan Party represents only that such information was prepared
in good faith based upon assumptions believed to be reasonable at the time.

 

5.16         Compliance with Laws.  Such Loan Party is in compliance in all
material respects with the requirements of all Laws and all orders, writs,
injunctions and decrees applicable to it or to its properties, except in such
instances in which (a) such requirement of Law or order, writ, injunction
or decree is being contested in good faith by appropriate proceedings
diligently conducted or (b) the failure to comply therewith, either
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.

 

5.17         Taxpayer Identification Number.  Borrower’s true and correct U.S. taxpayer
identification number is set forth on Schedule 10.02.

 

5.18         Intellectual Property; Licenses, Etc.  Such Loan Party
owns, or possesses the right to use, all of the trademarks, service marks,
trade names, copyrights, patents, patent rights, franchises, licenses and other
intellectual property rights that are reasonably necessary for the operation of
its business, without (to such Loan Party’s knowledge) conflict with the rights
of any other Person.  To the knowledge of
such Loan Party, no slogan or other advertising device, 

 

37

 

product,
process, method, substance, part or other material now employed, or now
contemplated to be employed, by such Loan Party infringes in any material
respect upon any rights held by any other Person.  No claim or litigation regarding any of the
foregoing is pending or, to the knowledge of such Loan Party, threatened,
which, either individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect.

 

ARTICLE VI.        AFFIRMATIVE COVENANTS

 

So long as any Lender shall have any Commitment hereunder, or any Loan
or other Obligation (other than unasserted contingent indemnification
obligations) hereunder shall remain unpaid or unsatisfied, Borrower shall, and
shall (except in the case of the covenants set forth in Sections 6.01, 6.02,  6.03, 6.11 and 6.12)
cause each other Loan Party to:

 

6.01         Financial Statements.  Deliver to Agent a sufficient number of
copies for delivery by Agent to each Lender, in form and detail reasonably
satisfactory to Agent:

 

(a)           as soon as available, but in any event within 120 days
after the end of each fiscal year of Borrower, a consolidated balance sheet of
Borrower and its Subsidiaries as at the end of such fiscal year, and the
related consolidated statements of income or operations, shareholders’ equity
and cash flows for such fiscal year, setting forth in each case in comparative
form the figures for the previous fiscal year, all in reasonable detail and
prepared in accordance with GAAP, such consolidated statements to be audited
and accompanied by a report and opinion of PriceWaterhouseCoopers LLC or
another independent certified public accountant of nationally recognized
standing and meeting the standards of the Public Company Accounting Oversight
Board, which report and opinion shall be prepared in accordance with generally
accepted auditing standards and shall not be subject to any “going concern” or
like qualification or exception or any qualification or exception as to the
scope of such audit;

 

(b)           as soon as available, but in any event within 45 days
after the end of each of the first three fiscal quarters of each fiscal year of
Borrower, a consolidated balance sheet of Borrower and its Subsidiaries as at
the end of such fiscal quarter, and the related consolidated statements of
income or operations, shareholders’ equity and cash flows for such fiscal
quarter and for the portion of Borrower’s fiscal year then ended, setting forth
in each case in comparative form the figures for the corresponding fiscal
quarter of the previous fiscal year and the corresponding portion of the
previous fiscal year, all in reasonable detail, such consolidated statements to be certified by the chief executive
officer, chief financial officer, treasurer or controller of Borrower as fairly
presenting in all material respects the financial condition, results of
operations, shareholders’ equity and cash flows of Borrower and its
Subsidiaries as of the date thereof in accordance with GAAP, subject only to
normal year-end audit adjustments and the absence of footnotes;

 

(c)           as soon as available, but in any event before January 31
of each fiscal year of Borrower, an annual budget and projections prepared by
the management of Borrower, in form reasonably satisfactory to Agent and the
Required Lenders, of consolidated balance sheets and statements of income or
operations and cash flows of Borrower and its Subsidiaries on a 

 

38

 

quarterly
basis for such fiscal year (including the fiscal year in which the Maturity
Date occurs); and

 

(d)           concurrently with the delivery of the financial statements
referred to in Sections 6.01(a) and (b), a quarterly
schedule reconciling the cash receipts of Milestone Payments to the revenue
recorded from such payments according to GAAP.

 

6.02         Certificates; Other Information.  Deliver to Agent a sufficient number of
copies for delivery by Agent to each Lender, in form and detail reasonably
satisfactory to Agent:

 

(a)           concurrently with the delivery of the financial statements
referred to in Section 6.01(a), a certificate of its independent
certified public accountants certifying such financial statements and stating
that in making the examination necessary therefor no knowledge was obtained of
any Default or, if any such Default shall exist, stating the nature and status
of such event (which certificate may be limited or not delivered to the extent
required by accounting rules or guidelines or to the extent that such
certificate cannot be obtained without additional cost);

 

(b)           concurrently with the delivery of the financial statements
referred to in Sections 6.01(a) and (b), a duly
completed Compliance Certificate signed by the chief executive officer, chief
financial officer, treasurer or controller of Borrower;

 

(c)           promptly after the same are available, copies of any audit
reports, management letters or recommendations submitted to the board of
directors (or the audit committee of the board of directors) of Borrower by
independent accountants in connection with the accounts or books of Borrower or
any Subsidiary, or any audit of any of them;

 

(d)           promptly after the same are available, copies of each
annual report, proxy or financial statement or other report or communication
sent to the stockholders of Borrower, and copies of all annual, regular,
periodic and special reports and registration statements which Borrower may
file or be required to file with the SEC under Section 13 or 15(d) of
the Securities Exchange Act of 1934, and not otherwise required to be delivered
to Agent pursuant hereto;

 

(e)           promptly after the furnishing thereof, copies of any
statement or report furnished to any holder of debt securities of any Loan
Party pursuant to the terms of any indenture, loan or credit or similar
agreement and not otherwise required to be furnished to the Lenders pursuant to
Section 6.01 or any other clause of this Section 6.02;

 

(f)            promptly, and in any event within five Business Days
after receipt thereof by any Loan Party or any Subsidiary thereof, copies of
each notice or other correspondence received from the SEC (or comparable agency
in any applicable non-U.S. jurisdiction) concerning any investigation or other
inquiry by such agency regarding financial or other operational results of any
Loan Party which could reasonably be expected to have a Material Adverse
Effect; and

 

39

 

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

 

Documents
required to be delivered pursuant to Section 6.01(a) or (b) or
Section 6.02(d) (to the extent any such documents are included
in materials otherwise filed with the SEC) may be delivered electronically and
if so delivered, shall be deemed to have been delivered on the date (i) on
which Borrower posts such documents, or provides a link thereto on Borrower’s
website on the Internet at the website address listed on Schedule 10.02;
or (ii) on which such documents are posted on Borrower’s behalf on an
Internet or intranet website, if any, to which each Lender and Agent have
access (whether a commercial, third-party website or whether sponsored by
Agent); provided that: (i) Borrower shall deliver paper copies of
such documents to Agent or any Lender that requests (through Agent) Borrower to
deliver such paper copies until a written request to cease delivering paper
copies is given by Agent or such Lender and (ii) Borrower shall notify
Agent (by telecopier or electronic mail) of the posting of any such documents
and provide to Agent by electronic mail electronic versions (i.e., soft copies)
of such documents.

 

Borrower
hereby acknowledges that (a) Agent will make available to Lenders
materials and/or information provided by or on behalf of Borrower hereunder
(collectively, “Borrower Materials”) by posting Borrower Materials on
IntraLinks or another similar electronic system (the “Platform”) and (b) certain
of the Lenders (each, a “Public
Lender”) may have personnel who do not wish to receive
material non-public information with respect to Borrower or its Affiliates or
the respective securities of any of the foregoing, and who may be engaged in
investment and other market-related activities with respect to such Persons’
securities.  Borrower hereby agrees that (w) all
Borrower Materials that are to be made available to Public Lenders shall be clearly
and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word
“PUBLIC” shall appear prominently on the first page thereof; (x) by
marking Borrower Materials “PUBLIC,” Borrower shall be deemed to have
authorized Agent and the Lenders to treat such Borrower Materials as not
containing any material non-public information with respect to Borrower or its
securities for purposes of United States Federal and state securities laws
(provided, however, that to the extent such Borrower Materials constitute
Information, they shall be treated as set forth in Section 11.07); (y) all
Borrower Materials marked “PUBLIC” are permitted to be made available through a
portion of the Platform designated “Public Investor;” and (z) Agent shall
be entitled to treat any Borrower Materials that are not marked “PUBLIC” as
being suitable only for posting on a portion of the Platform not designated “Public
Investor”.

 

6.03         Notices. 
Promptly notify Agent:

 

(a)           of the occurrence of any Default;

 

(b)           of any matter that has resulted or could reasonably be
expected to result in a Material Adverse Effect, including (i) breach or
non-performance of, or any default under, a Material Contract or other material
Contractual Obligation of Borrower or any Subsidiary; (ii) any material
dispute, litigation, investigation, proceeding or suspension between Borrower
or any Subsidiary and any Governmental Authority (other than routine FDA
proceedings that could not reasonably be expected to have a Material Adverse
Effect); or (iii) the commencement of, or any 

 

40

 

material
development in, any material litigation or proceeding affecting Borrower or any
Subsidiary, including pursuant to any applicable Environmental Laws, but
excluding routine FDA proceedings that could not reasonably be expected to have
a Material Adverse Effect;

 

(c)           of the occurrence of any ERISA Event;  and

 

(d)           of any material change in accounting policies or financial
reporting practices by Borrower or any other Loan Party.

 

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

 

6.04         Payment of Obligations.  Pay and discharge as the same shall become
due and payable, all its obligations and liabilities, including (a) all
tax liabilities, assessments and governmental charges or levies upon it or its
properties or assets, unless the same are being contested in good faith by
appropriate proceedings diligently conducted and adequate reserves in
accordance with GAAP are being maintained by Borrower or such Loan Party; (b) all
lawful claims which, if unpaid, would by law become a Lien upon its property;
and (c) all Indebtedness, as and when due and payable, but subject to any
subordination provisions contained in any instrument or agreement evidencing
such Indebtedness.

 

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

 

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

 

6.07         Maintenance of Insurance.  Maintain with financially sound and reputable
insurance companies not Affiliates of Borrower, insurance with respect to its
properties and business against loss or damage of the kinds customarily insured
against by Persons engaged in the same or similar business, of such types and
in such amounts (after giving effect to any self-insurance compatible with the
following standards) as are customarily carried under similar 

 

41

 

circumstances
by such other Persons and providing for not less than 30 days’ prior notice to
Agent of termination, lapse or cancellation of such insurance.

 

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

 

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

 

6.10         Inspection Rights. 
Permit representatives and independent contractors of Agent and each
Lender (provided, that if there is more than one Lender, then such visits or
inspections are coordinated through the Agent) to visit and inspect any of its
properties, to examine its corporate, financial and operating records, and make
copies thereof or abstracts therefrom, and to discuss its affairs, finances and
accounts with its directors, officers, and independent public accountants, all
at the expense of Borrower and at such reasonable times during normal business
hours and as often as may be reasonably desired, upon reasonable advance notice
to Borrower; provided, however, that when an Event of Default
exists Agent or any Lender (or any of their respective representatives or
independent contractors) may do any of the foregoing at the expense of Borrower
at any time during normal business hours and without advance notice.

 

6.11         Use of Proceeds. 
Use the proceeds of the Borrowings to finance leasehold improvements to,
and new equipment for, the Bedford Facility not in contravention of any Law or
of any Loan Document.

 

6.12         Financial Covenants.

 

(a)           Quick Ratio. 
Maintain on a consolidated basis a ratio of (i) Quick Assets to (ii) Total
Current Liabilities plus Total
Revolving Credit Outstandings, of at least 2.0:1.0.

 

(b)           Consolidated Fixed Charge
Coverage Ratio.  Maintain on
a consolidated basis a Consolidated Fixed Charge Coverage Ratio of at least 1.25:1.0.

 

These
ratios will be calculated at the end of each reporting period for which this
Agreement requires Borrower to deliver financial statements, using the results
of the twelve-month period ending with that reporting period.  The current portion of long-term liabilities
will be measured as of the last day of
such reporting period.

 

6.13         Additional Guarantors.  Notify Agent at the time that any Person
becomes a Subsidiary of Borrower, and, unless otherwise agreed in writing by
the Lenders, promptly 

 

42

 

thereafter
(and in any event within 30 days), (a) cause such Person to become a
Guarantor (or if such Subsidiary is a “controlled foreign corporation” under Section 957
of the Code, grant Agent a first-priority, perfected security interest in 65%
of the capital stock or other equity of such Foreign Subsidiary) by executing
and delivering to Agent a counterpart of this Agreement or such other document(s) as
Agent shall deem reasonably appropriate for such purpose, and (b) deliver,
or cause such Person to deliver, to Agent documents of the types referred to in
clauses (iii) and (iv) of Section 4.01(a) and
favorable opinions of counsel to such Person (which shall cover, among other
things, the legality, validity, binding effect and enforceability of the
documentation referred to in clause (a)), all in form, content and scope reasonably
satisfactory to Agent.

 

ARTICLE VII.      NEGATIVE COVENANTS

 

So long as any Lender shall have any Commitment hereunder, or any Loan
or other Obligation (other than unasserted contingent indemnification
obligations) hereunder shall remain unpaid or unsatisfied, Borrower shall not,
nor shall it permit any other Loan Party to, directly or indirectly:

 

7.01         Liens.  Create, incur, assume or suffer to exist any
Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, or sign or file or suffer to exist under the Uniform
Commercial Code of any jurisdiction a financing that names any Loan Party as a
debtor, or assign any accounts or other right to receive income, other than the
following:

 

(a)           Liens in favor of the Agent and Lenders (if any);

 

(b)           Liens existing on the date hereof and listed on Schedule
7.01 and any renewals or extensions thereof, provided that (i) the
property covered thereby is not changed, (ii) the amount secured or
benefited thereby is not increased except as contemplated by Section 7.03(b),
(iii) the direct or any contingent obligor with respect thereto is not
changed, and (iv)  and any renewal or extension of the obligations secured
or benefited thereby is permitted by Section 7.03(b);

 

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

 

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

 

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

 

43

 

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

 

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

 

(h)           Liens securing judgments for the payment of money not
constituting an Event of Default under Section 8.01(h); and

 

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

 

7.02         Investments.  Make any Investments, except:

 

(a)           Investments held by Borrower or such Subsidiary in the
form of cash equivalents or short-term marketable debt securities;

 

(b)           advances to officers, directors and employees of Borrower
and Subsidiaries in an aggregate amount not to exceed $500,000 at any time outstanding, for travel, entertainment,
relocation and analogous ordinary business purposes;

 

(c)           Investments of Borrower in any Guarantor and Investments
of any Guarantor in Borrower or in another Guarantor;

 

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

 

(e)           Guarantees permitted by Section 7.03;

 

(f)            Investments existing on the date hereof (other than those
referred to in Section 7.02(c)) and set forth on Schedule 7.02;

 

(g)           Investments by the Borrower in Swap Contracts permitted
under Section 7.03(d);

 

(h)           the purchase or other acquisition of (1) all of the
Equity Interests in, or (2) all or substantially all of the property of,
or (3) any product line, line of business or division of, any Person that,
upon the consummation thereof, will be at least 50% owned directly by the
Borrower or one or more Guarantors (including as a result of a merger or
consolidation); 

 

44

 

provided that, with
respect to each purchase or other acquisition made pursuant to this Section 7.02(h):

 

(i)            any such newly-created or acquired Subsidiary shall
comply with the requirements of Section 6.13;

 

(ii)           neither Borrower nor any Subsidiary thereof shall directly
own or hold any Equity Interest in any joint venture if as a matter of law
Borrower or any of its Subsidiaries is liable for the debts and liabilities of
such joint venture;

 

(iii)          the lines of business of the Person to be (or the property
of which is to be) so purchased or otherwise acquired shall be substantially
the same or substantially related lines of business as one or more of the
principal businesses of the Borrower and its Subsidiaries in the ordinary
course;

 

(iv)          such purchase or other acquisition shall not include or
result in the incurrence or assumption of any contingent liabilities that could
reasonably be expected to have a material adverse effect on the business,
operations, liabilities or condition (financial or otherwise) of the Borrower
and its Subsidiaries, taken as a whole (as determined in good faith by the
board of directors (or the persons performing similar functions) of the
Borrower if the board of directors is otherwise approving such transaction and,
in each other case, by a Responsible Officer);

 

(v)           the total cash and noncash consideration (including the
fair market value of all Equity Interests issued or transferred to the sellers
thereof, all indemnities, earnouts and other contingent payment obligations to,
and the aggregate amounts paid or to be paid under noncompete, consulting and
other affiliated agreements (other than employment agreements for services
actually rendered to a Loan Party after the date thereof) with, the sellers
thereof, all write-downs of property and reserves for liabilities with respect
thereto and all assumptions of Indebtedness and other obligations in connection
therewith) paid by or on behalf of the Borrower and its Subsidiaries for any
such purchase or other acquisition, when aggregated with the total cash and
noncash consideration paid by or on behalf of the Borrower and its Subsidiaries
for all other purchases and other acquisitions made by the Borrower and its
Subsidiaries pursuant to this Section 7.02(h), shall not exceed
$10,000,000 in cumulative aggregate at any time;

 

(vi)          (A) immediately before and immediately after giving
pro forma effect to any such purchase or other acquisition, no Default shall
have occurred and be continuing, (B) immediately before and immediately
after giving effect to such purchase or other acquisition, none of Borrower or
any Subsidiary, or to Borrower’s knowledge any Person Controlling Borrower,
shall be or shall be required to be registered as, an “investment company”
under the Investment Company Act of 1940, and (C) immediately after giving
effect to such purchase or other acquisition, the Borrower and its Subsidiaries
shall be in pro forma compliance with all of the covenants set forth in Section 6.12,
such compliance to be determined on the basis of the financial information most
recently delivered to the Agent pursuant to Section 6.01(a) or (b) as
though such purchase or other acquisition had been consummated as of the first
day of the fiscal period covered thereby; and

 

45

 

(vii)         Borrower shall have delivered to Agent, at least five
Business Days prior to the date on which any such purchase or other acquisition
is to be consummated, a certificate of a Responsible Officer, in form and
substance reasonably satisfactory to Agent, certifying that all of the
requirements set forth in this Section 7.02(h) have been
satisfied or will be satisfied on or prior to the consummation of such purchase
or other acquisition.

 

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

 

(a)           Indebtedness under the Loan Documents;

 

(b)           Indebtedness outstanding on the date hereof and listed on Schedule
7.03 and any refinancings, refundings, renewals or extensions thereof; provided
that (i) the amount of such Indebtedness is not increased at the time of
such refinancing, refunding, renewal or extension except by an amount equal to
a reasonable premium or other reasonable amount paid, and fees and expenses
reasonably incurred, in connection with such refinancing and by an amount equal
to any existing commitments unutilized thereunder and (ii) the terms
relating to principal amount, amortization, maturity, collateral (if any) and
subordination (if any), and other material terms taken as a whole, of any such
refinancing, refunding, renewing or extending Indebtedness, and of any
agreement entered into and of any instrument issued in connection therewith,
are no less favorable in any material respect to the Loan Parties or Lenders
than the terms of any agreement or instrument governing the Indebtedness being
refinanced, refunded, renewed or extended and the interest rate applicable to
any such refinancing, refunding, renewing or extending Indebtedness does not
exceed the then applicable market interest rate;

 

(c)           Guarantees of Borrower or any Guarantor in respect of
Indebtedness otherwise permitted hereunder of Borrower or any other Guarantor
and Indebtedness of a Guarantor owed to the Borrower or another Guarantor, in
each case that is on terms (including subordination terms) acceptable to the
Agent and is otherwise permitted under Section 7.02;

 

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

 

(e)           Indebtedness in respect of capital leases, Synthetic Lease
Obligations and purchase money obligations for fixed or capital assets within
the limitations set forth in Section 7.01(i); provided, however,
that the aggregate amount of all such Indebtedness at any one time outstanding
shall not exceed $100,000 in any fiscal
year; and

 

(f)            Indebtedness in respect of
capital leases and purchase money obligations for fixed or capital assets
acquired in a Permitted Acquisition and within the limitations set forth 

 

46

 

in
Section 7.01(i); provided, however, that the
aggregate amount of all such Indebtedness at any one time outstanding shall not
exceed $500,000 in any fiscal year;

 

(g)           Indebtedness in respect of
capital leases and purchase money obligations for fixed or capital assets owing
to any Affiliate of Bank of America and within the limitations set forth in Section 7.01(i);
provided, however, that (i) the aggregate amount of all such
Indebtedness at any one time outstanding shall not exceed $6,000,000 and (ii) the Revolving
Credit Facility shall have been permanently reduced in accordance with Section 2.06
by an amount equal to the aggregate principal amount of such Indebtedness; and

 

(h)           Subordinated Liabilities, containing terms and conditions
reasonably satisfactory to Agent, that are assumed or acquired by a Loan Party
in compliance with Section 7.02(h), so long as both immediately before and
immediately after giving effect to any such assumption or acquisition, no
Default (including in respect of Section 6.12) has occurred and is
continuing or would result therefrom, and Agent shall have received a
certificate of a Responsible Officer, in form and substance reasonably
satisfactory to Agent, to such effect.

 

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

 

(a)           any Subsidiary may merge with (i) Borrower, provided
that Borrower shall be the continuing or surviving Person, or (ii) any one
or more Guarantors, provided that the Guarantor shall be the continuing
or surviving Person; and

 

(b)           any Subsidiary may Dispose of all or substantially all of
its assets (upon voluntary liquidation or otherwise) to Borrower or to a
Guarantor.

 

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

 

(a)           Dispositions of obsolete, worn out or surplus property,
whether now owned or hereafter acquired, in the ordinary course of business;

 

(b)           Dispositions of inventory in the ordinary course of
business;

 

(c)           Dispositions of equipment or real property to the extent
that (i) such property is exchanged for credit against the purchase price
of similar replacement property or (ii) the proceeds of such Disposition
are reasonably promptly applied to the purchase price of such replacement
property;

 

(d)           Dispositions of property by any Subsidiary to Borrower or
to a Guarantor;

 

(e)           Dispositions permitted by Section 7.04; and

 

47

 

(f)            Licenses of intellectual property in the ordinary course
of business that (i) are nonexclusive or (ii) grant exclusive rights
to a specified product in a specified territory for a limited term.

 

provided, however,
that any Disposition pursuant to clauses (a) through (f) shall be for
fair market value.

 

7.06         Restricted Payments. 
Declare or make, directly or indirectly, any Restricted Payment, or
incur any obligation (contingent or otherwise) to do so, except that, so long
as no Default shall have occurred and be continuing at the time of any action
described below or would result therefrom:

 

(a)           each Subsidiary may make Restricted Payments to Borrower,
Guarantors and any other Person that owns an Equity Interest in such
Subsidiary, ratably according to their respective holdings of the type of
Equity Interest in respect of which such Restricted Payment is being made;

 

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

 

(c)           Borrower and each Subsidiary may purchase, redeem or
otherwise acquire Equity Interests issued by it with the proceeds received from
the substantially concurrent issue of new shares of its common stock or other
common Equity Interests; and

 

(d)           Borrower may make Restricted Payments to repurchase or
redeem common stock of Borrower held by:

 

(i)            its present or former officers, directors or employees,
upon their death, disability, retirement, severance or termination of
employment or service, provided that the aggregate cash consideration
paid for all such repurchases or redemptions shall not exceed $250,000 in any
fiscal year; and

 

(ii)           its public stockholders, provided that both
immediately before and after making such Restricted Payments, Borrower and its
Subsidiaries shall be in pro forma
compliance with all of the covenants set forth in Section 6.12, and
Borrower shall have delivered to Agent, at least five Business Days prior to
the making of such Restricted Payments, a certificate from a Responsible
Officer of Borrower (A) certifying that no Default has occurred and is
continuing at the time of any such Restricted Payments or would result
therefrom and (B) demonstrating (in detail reasonably satisfactory to
Agent) compliance with the requirements of this Section 7.06(d)(ii).

 

7.07         Change in Nature of Business.  Engage in any material line of business
substantially different from those lines of business conducted by Borrower and
its Subsidiaries on the date hereof or any business substantially related or
incidental thereto.

 

48

 

7.08         Transactions with Affiliates.  Enter into any transaction of any kind with
any Affiliate of Borrower, whether or not in the ordinary course of business,
other than on fair and reasonable terms substantially as favorable to Borrower
or such Subsidiary as would be obtainable by Borrower or such Subsidiary at the
time in a comparable arm’s length transaction with a Person other than an
Affiliate.

 

7.09         Burdensome Agreements.  Enter into any Contractual Obligation (other
than this Agreement or any other Loan Document) that (a) limits the
ability (i) of any Subsidiary to make Restricted Payments to any Loan
Party or to otherwise transfer property to any Loan Party, (ii) of any
Subsidiary to Guarantee the Indebtedness of Borrower or (iii) of Borrower
or any Subsidiary to create, incur, assume or suffer to exist Liens on property
of such Person; provided, however, that this clause (iii) shall
not prohibit any negative pledge incurred or provided in favor of any holder of
Indebtedness permitted under Section 7.03(e) solely to the
extent any such negative pledge relates to the property financed by or the
subject of such Indebtedness; or (b) requires the grant of a Lien to
secure an obligation of such Person if a Lien is granted to secure another
obligation of such Person.

 

7.10         Use of Proceeds. 
Use the proceeds of any Borrowing, whether directly or indirectly, and
whether immediately, incidentally or ultimately, to purchase or carry margin
stock (within the meaning of Regulation U of the FRB) or to extend credit to
others for the purpose of purchasing or carrying margin stock or to refund
indebtedness originally incurred for such purpose.

 

ARTICLE VIII.     EVENTS OF DEFAULT AND REMEDIES

 

8.01         Events of Default.  Any of the following shall constitute an
Event of Default:

 

(a)           Non-Payment. 
Borrower or any other Loan Party fails to pay (i) when and as
required to be paid herein, any amount of principal of any Loan, or (ii) within
three Business Days after the same becomes due, any interest on any Loan, or
any fee due hereunder, or (iii) within five days after the same becomes
due, any other amount payable hereunder or under any other Loan Document; or

 

(b)           Specific Covenants. 
Borrower fails to perform or observe any term, covenant or agreement
contained in any of Section 6.01, 6.02, 6.03, 6.05,
6.10, 6.11,  6.12 or 6.13 or Article VII, and, with respect to Section 6.01,
6.02, 6.03, such failure continues for one Business Day after
notice thereof to Borrower or after Borrower obtains knowledge thereof, or any Guarantor fails to perform or observe
any term, covenant or agreement contained in the Guaranty; or

 

(c)           Other Defaults. 
Any Loan Party fails to perform or observe any other covenant or
agreement (not specified in subsection (a) or (b) above) contained in
any Loan Document on its part to be performed or observed and such failure
continues for 30 days or any default or Event of Default occurs under any other
Loan Document; or

 

(d)           Representations and Warranties.  Any representation, warranty, certification
or statement of fact made or deemed made by or on behalf of Borrower or any
other 

 

49

 

Loan
Party herein, in any other Loan Document, or in any document delivered in
connection herewith or therewith shall be incorrect or misleading in any
material respect when made or deemed made; or

 

(e)           Cross-Default. 
(i) Borrower or any Loan Party (A) fails to make any payment
when due (whether by scheduled maturity, required prepayment, acceleration,
demand, or otherwise) in respect of any Indebtedness or Guarantee (other than
Indebtedness hereunder and Indebtedness under Swap Contracts) having an
aggregate principal amount (including undrawn committed or available amounts
and including amounts owing to all creditors under any combined or syndicated
credit arrangement) of more than the Threshold Amount, or (B) fails to
observe or perform any other agreement or condition relating to any such
Indebtedness or Guarantee or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event occurs, the effect
of which default or other event is to cause, or to permit the holder or holders
of such Indebtedness or the beneficiary or beneficiaries of such Guarantee (or
a trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, with the giving of notice if required, such
Indebtedness to be demanded or to become due or to be repurchased, prepaid,
defeased or redeemed (automatically or otherwise), or an offer to repurchase,
prepay, defease or redeem such Indebtedness to be made, prior to its stated
maturity, or such Guarantee to become payable or cash collateral in respect
thereof to be demanded; or (ii) there occurs under any Swap Contract an
Early Termination Date (as defined in such Swap Contract) resulting from (A) any
event of default under such Swap Contract as to which Borrower or any
Subsidiary is the Defaulting Party (as defined in such Swap Contract) or (B) any
Termination Event (as so defined) under such Swap Contract as to which Borrower
or any Subsidiary is an Affected Party (as so defined) and, in either event,
the Swap Termination Value owed by Borrower or such Subsidiary as a result
thereof is greater than the Threshold Amount; or

 

(f)            Insolvency Proceedings, Etc.  Any Loan Party institutes or consents to the
institution of any proceeding under any Debtor Relief Law, or makes an
assignment for the benefit of creditors; or applies for or consents to the
appointment of any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer for it or for all or any material part of its
property; or any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer is appointed without the application or
consent of such Person and the appointment continues undischarged or unstayed
for 60 calendar days; or any proceeding under any Debtor Relief Law relating to
any such Person or to all or any material part of its property is instituted
without the consent of such Person and continues undismissed or unstayed for 60
calendar days, or an order for relief is entered in any such proceeding; or

 

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

 

(h)           Judgments. 
There is entered against any Loan Party (i) one or more final
judgments or orders for the payment of money in an aggregate amount (as to all
such judgments 

 

50

 

or
orders) exceeding the Threshold Amount (to the extent not covered by
independent third-party insurance as to which the insurer does not dispute
coverage), or (ii) any one or more non-monetary final judgments that have,
or could reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect and, in either case, (A) enforcement proceedings
are commenced by any creditor upon such judgment or order, or (B) there is
a period of 10 consecutive days during which a stay of enforcement of such
judgment, by reason of a pending appeal or otherwise, is not in effect; or

 

(i)            ERISA.  (1) An
ERISA Event occurs with respect to a Pension Plan or Multiemployer Plan which
has resulted or could reasonably be expected to result in liability of Borrower
under Title IV of ERISA to the Pension Plan, Multiemployer Plan or the
PBGC in an aggregate amount in excess of the Threshold Amount, or (2) Borrower
or any ERISA Affiliate fails to pay when due, after the expiration of any
applicable grace period, any installment payment with respect to its withdrawal
liability under Section 4201 of ERISA under a Multiemployer Plan in an
aggregate amount in excess of the Threshold Amount; or

 

(j)            Invalidity of Loan Documents.  Any Loan Document or any provision thereof,
at any time after its execution and delivery and for any reason other than as
expressly permitted hereunder or thereunder or satisfaction in full of all the
Obligations, ceases to be in full force and effect; or any Loan Party or any
other Person contests in any manner the validity or enforceability of any Loan
Document or any provision thereof; or any Loan Party denies that it has any or
further liability or obligation under any Loan Document, or purports to revoke,
terminate or rescind any Loan Document or any provision thereof;

 

(k)           Change of Control. 
There occurs any Change of Control;

 

(l)            Subordination. 
(i)  The subordination provisions of the documents evidencing or
governing any subordinated Indebtedness (the “Subordinated Provisions”)
shall, in whole or in part, terminate, cease to be effective or cease to be
legally valid, binding and enforceable against any holder of the applicable
subordinated Indebtedness; or (ii) the Borrower or any other Loan Party
shall, directly or indirectly, disavow or contest in any manner (A) the
effectiveness, validity or enforceability of any of the Subordination
Provisions, (B) that the Subordination Provisions exist for the benefit of
the Administrative Agent and the Lenders or (C) that all payments of
principal of or premium and interest on the applicable subordinated
Indebtedness, or realized from the liquidation of any property of any Loan
Party, shall be subject to any of the Subordination Provisions.

 

(m)          Material Contracts. 
(i)  Material Contract(s) constituting 20% or more of Borrower’s
total annual revenues shall be terminated or cancelled or shall expire, or (ii) there
shall occur any material default or breach in respect of such Material
Contract(s), and such failure continues after the expiration of any grace
period specified therein; provided, that the foregoing events in this
paragraph (m) shall not constitute an Event of Default under this
Agreement if (1) the Borrower is diligently attempting to replace such
Material Contract(s) with one or more equivalent agreements with parties
and on terms reasonably acceptable to the Agent and does so within 60 days
after such termination, cancellation, expiration, default or breach or (2) the
Borrower demonstrates and certifies in writing to the Agent’s reasonable
satisfaction, on 

 

51

 

a
pro forma basis thereafter, that notwithstanding such termination,
cancellation, expiration, default or breach, Borrower will remain in compliance
with all financial covenants under Section 6.12 of this Agreement
thereafter.

 

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

 

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

 

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

 

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

 

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

 

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

 

First, to payment of that portion of the Obligations
constituting fees, indemnities, expenses and other amounts (including fees,
charges and disbursements of counsel to Agent (including fees and time charges
for attorneys who may be employees of Agent) and amounts payable under Article III)
payable to Agent in its capacity as such;

 

Second, to payment of that portion of the Obligations
constituting fees, indemnities and other amounts (other than principal and
interest) payable to Lenders (including fees, charges and disbursements of
counsel to the respective Lenders (including fees and time charges for
attorneys who may be employees of any Lender) and amounts payable under Article III),
ratably among them in proportion to the respective amounts described in this
clause Second payable to them;

 

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

 

Fourth, to payment of that portion of the Obligations
constituting unpaid principal of the Loans and amounts owing under Hedge
Agreements and Cash Management Agreements, ratably 

 

52

 

among Lenders, the Hedge Banks and the Cash
Management Banks in proportion to the respective amounts described in this
clause Fourth held by them; and

 

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

 

ARTICLE IX.        ADMINISTRATIVE AGENT

 

9.01         Appointment and Authorization of Administrative Agent.  Each of the Lenders hereby irrevocably
appoints Bank of America to act on its behalf as Administrative Agent hereunder
and under the other Loan Documents and authorizes Agent to take such actions on
its behalf and to exercise such powers as are delegated to Agent by the terms
hereof and thereof, together with such actions and powers as are reasonably incidental
thereto.  The provisions of this Article are
solely for the benefit of Agent and the Lenders, and neither Borrower nor any
other Loan Party shall have rights as a third party beneficiary of any of such
provisions.

 

9.02         Rights as a Lender.  The Person serving as Agent hereunder shall
have the same rights and powers in its capacity as a Lender as any other Lender
and may exercise the same as though it were not Agent and the term “Lender” or “Lenders”
shall, unless otherwise expressly indicated or unless the context otherwise
requires, include the Person serving as Agent hereunder in its individual
capacity.  Such Person and its Affiliates
may accept deposits from, lend money to, act as the financial advisor or in any
other advisory capacity for and generally engage in any kind of business with
Borrower or any Subsidiary or other Affiliate thereof as if such Person were
not Agent hereunder and without any duty to account therefor to Lenders.

 

9.03         Exculpatory Provisions.  Agent shall not have any duties or
obligations except those expressly set forth herein and in the other Loan
Documents.  Without limiting the
generality of the foregoing, Agent:

 

(a)           shall not be subject to any fiduciary or other implied
duties, regardless of whether a Default has occurred and is continuing;

 

(b)           shall not have any duty to take any discretionary action
or exercise any discretionary powers, except discretionary rights and powers
expressly contemplated hereby or by the other Loan Documents that Agent is
required to exercise as directed in writing by the Required Lenders (or such
other number or percentage of the Lenders as shall be expressly provided for
herein or in the other Loan Documents), provided that Agent shall not be
required to take any action that, in its opinion or the opinion of its counsel,
may expose Agent to liability or that is contrary to any Loan Document or
applicable Law; and

 

(c)           shall not, except as expressly set forth herein and in the
other Loan Documents, have any duty to disclose, and shall not be liable for
the failure to disclose, any information relating to Borrower or any of its
Affiliates that is communicated to or obtained by the Person serving as Agent
or any of its Affiliates in any capacity.

 

(d)           Agent shall not be liable for any action taken or not
taken by it (i) with the consent or at the request of the Required Lenders
(or such other number or percentage of the

 

53

 

Lenders
as shall be necessary, or as Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 8.02 and
11.01) or (ii) in the absence of its own gross negligence or willful
misconduct.  Agent shall be deemed not to
have knowledge of any Default unless and until written notice describing such
Default is given to Agent by Borrower or a Lender.  Agent shall not be responsible for or have
any duty to ascertain or inquire into (i) any statement, warranty or
representation made in or in connection with this Agreement or any other Loan
Document, (ii) the contents of any certificate, report or other document
delivered hereunder or thereunder or in connection herewith or therewith, (iii) the
performance or observance of any of the covenants, agreements or other terms or
conditions set forth herein or therein or the occurrence of any Default, (iv) the
validity, enforceability, effectiveness or genuineness of this Agreement, any
other Loan Document or any other agreement, instrument or document or (v) the
satisfaction of any condition set forth in Article IV or elsewhere
herein, other than to confirm receipt of items expressly required to be
delivered to Agent.

 

9.04         Reliance by Administrative Agent.  Agent shall be entitled to rely upon, and
shall not incur any liability for relying upon, any notice, request,
certificate, consent, statement, instrument, document or other writing
(including any electronic message, Internet or intranet website posting or
other distribution) believed by it to be genuine and to have been signed, sent
or otherwise authenticated by the proper Person.  Agent also may rely upon any statement made
to it orally or by telephone and believed by it to have been made by the proper
Person, and shall not incur any liability for relying thereon.  In determining compliance with any condition
hereunder to the making of a Loan that by its terms must be fulfilled to the
satisfaction of a Lender, Agent may presume that such condition is satisfactory
to such Lender unless Agent shall have received notice to the contrary from
such Lender prior to the making of such Loan. 
Agent may consult with legal counsel (who may be counsel for Borrower),
independent accountants and other experts selected by it, and shall not be liable
for any action taken or not taken by it in accordance with the advice of any
such counsel, accountants or experts.

 

9.05         Delegation of Duties.  Agent may perform any and all of its duties
and exercise its rights and powers hereunder or under any other Loan Document
by or through any one or more sub-agents appointed by Agent.  Agent and any such sub-agent may perform any
and all of its duties and exercise its rights and powers by or through their
respective Related Parties.  The
exculpatory provisions of this Article shall apply to any such sub-agent
and to the Related Parties of Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Agent.

 

9.06         Resignation of Agent. 
Agent may at any time give notice of its resignation to Lenders and
Borrower.  Upon receipt of any such
notice of resignation, the Required Lenders shall have the right, in consultation
with Borrower, to appoint a successor, which shall be a bank with an office in
the United States, or an Affiliate of any such bank with an office in the
United States.  If no such successor
shall have been so appointed by the Required Lenders and shall have accepted
such appointment within 30 days after the retiring Agent gives notice of
its resignation, then the retiring Agent may on behalf of Lenders, appoint a
successor Agent meeting the qualifications set forth above; provided
that if Agent shall notify Borrower and the Lenders that no qualifying Person
has accepted such appointment, then such resignation shall nonetheless become
effective in accordance with such notice and (1) the retiring Agent shall
be 

 

54

 

discharged
from its duties and obligations hereunder and under the other Loan Documents
and (2) all payments, communications and determinations provided to be
made by, to or through Agent shall instead be made by or to each Lender
directly, until such time as the Required Lenders appoint a successor Agent as
provided for above in this Section.  Upon
the acceptance of a successor’s appointment as Agent hereunder, such successor
shall succeed to and become vested with all of the rights, powers, privileges
and duties of the retiring (or retired) Agent, and the retiring Agent shall be
discharged from all of its duties and obligations hereunder or under the other
Loan Documents (if not already discharged therefrom as provided above in this
Section).  The fees payable by Borrower
to a successor Agent shall be the same as those payable to its predecessor
unless otherwise agreed between Borrower and such successor.  After the retiring Agent’s resignation
hereunder and under the other Loan Documents, the provisions of this Article and
Section 11.04 shall continue in effect for the benefit of such
retiring Agent, its sub-agents and their respective Related Parties in respect
of any actions taken or omitted to be taken by any of them while the retiring
Administrative Agent was acting as Administrative Agent.

 

9.07         Non-Reliance on Agent and Other Lenders.  Each Lender
acknowledges that it has, independently and without reliance upon Agent or any
other Lender or any of their Related Parties and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. 
Each Lender also acknowledges that it will, independently and without
reliance upon Agent or any other Lender or any of their Related Parties and
based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any other Loan Document or any related
agreement or any document furnished hereunder or thereunder.

 

9.08         No Other Duties, Etc. 
Anything herein to the contrary notwithstanding, no Lender holding a
title listed on the cover page hereof shall have any powers, duties or
responsibilities under this Agreement or any of the other Loan Documents,
except in its capacity, as applicable, as Agent or a Lender hereunder.

 

9.09         Administrative Agent May File Proofs of Claim.  In case of the pendency of any proceeding
under any Debtor Relief Law or any other judicial proceeding relative to any
Loan Party, Agent (irrespective of whether the principal of any Loan shall then
be due and payable as herein expressed or by declaration or otherwise and
irrespective of whether Agent shall have made any demand on Borrower) shall be
entitled and empowered, by intervention in such proceeding or otherwise:

 

(a)           to file and prove a claim for the whole amount of the
principal and interest owing and unpaid in respect of the Loans and all other
Obligations that are owing and unpaid and to file such other documents as may
be necessary or advisable in order to have the claims of Lenders and Agent
(including any claim for the reasonable compensation, expenses, disbursements
and advances of Lenders and Agent and their respective agents and counsel and
all other amounts due Lenders and Agent under Sections 2.09 and 11.04)
allowed in such judicial proceeding; and

 

55

 

(b)           to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same;

 

and
any custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Lender to make such payments to Agent and, in the event that Agent shall
consent to the making of such payments directly to Lenders, to pay to Agent any
amount due for the reasonable compensation, expenses, disbursements and
advances of Agent and its agents and counsel, and any other amounts due Agent
under Sections 2.09 and 11.04. 
Nothing contained herein shall be deemed to authorize Agent to authorize
or consent to or accept or adopt on behalf of any Lender any plan of
reorganization, arrangement, adjustment or composition affecting the
Obligations or the rights of any Lender or to authorize Agent to vote in
respect of the claim of any Lender in any such proceeding.

 

9.10         Guaranty Matters. 
Each Lender hereby irrevocably authorizes Agent, at its option and in
its discretion, to release any Guarantor from its obligations under the Guaranty
if such Person ceases to be a Subsidiary as a result of a transaction permitted
hereunder.  Upon request by Agent at any
time, each Lender will confirm in writing Agent’s authority to release any
Guarantor from its obligations under the Guaranty pursuant to this Section 9.10.

 

ARTICLE X.         CONTINUING GUARANTY

 

10.01       Guaranty.  Each
Guarantor hereby absolutely and unconditionally guarantees, jointly and
severally, as a guaranty of payment and performance and not merely as a
guaranty of collection, prompt payment when due, whether at stated maturity, by
required prepayment, upon acceleration, demand or otherwise, and at all times
thereafter, of any and all of the Obligations, whether for principal, interest,
premiums, fees, indemnities, damages, costs, expenses or otherwise, of the
Borrower and each other Guarantor to the Guaranteed Parties, arising hereunder
and under the other Loan Documents (including all renewals, extensions,
amendments, refinancings and other modifications thereof and all costs,
attorneys’ fees and expenses incurred by the Guaranteed Parties in connection
with the collection or enforcement thereof). 
The Administrative Agent’s books and records showing the amount of the
Obligations shall be admissible in evidence in any action or proceeding, and
shall be binding upon each Guarantor, and conclusive (absent manifest error)
for the purpose of establishing the amount of the Obligations.  This Guaranty shall not be affected by the
genuineness, validity, regularity or enforceability of the Obligations or any
instrument or agreement evidencing any Obligations, or by the existence,
validity, enforceability, perfection, non-perfection or extent of any
collateral (if any) therefor, or by any fact or circumstance relating to the
Obligations which might otherwise constitute a defense to the obligations of
any Guarantor under this Guaranty, and each Guarantor hereby irrevocably waives
any defenses it may now have or hereafter acquire in any way relating to any or
all of the foregoing.

 

10.02       Rights of Lenders. 
Each Guarantor consents and agrees that the Guaranteed Parties may, at
any time and from time to time, without notice or demand, and without affecting
the enforceability or continuing effectiveness hereof:  (a) amend, extend, renew, compromise,
discharge, accelerate or otherwise change the time for payment or the terms of
the Obligations or 

 

56

 

any
part thereof; (b) take, hold, exchange, enforce, waive, release, fail to
perfect, sell, or otherwise dispose of any security (if any) or other guaranty
for the payment of this Guaranty or any Obligations; (c) apply such
security (if any) and direct the order or manner of sale thereof as the
Administrative Agent and the Lenders in their sole discretion may determine;
and (d) release or substitute one or more of any endorsers or other
guarantors of any of the Obligations. 
Without limiting the generality of the foregoing, each Guarantor
consents to the taking of, or failure to take, any action which might in any
manner or to any extent vary the risks of any Guarantor under this Guaranty or
which, but for this provision, might operate as a discharge of any Guarantor.

 

10.03       Certain Waivers. 
Each Guarantor waives (a) any defense arising by reason of any
disability or other defense of the Borrower or any other guarantor, or the
cessation from any cause whatsoever (including any act or omission of any
Guaranteed Party) of the liability of the Borrower or any other guarantor; (b) any
defense based on any claim that any Guarantor’s obligations exceed or are more
burdensome than those of the Borrower; (c) the benefit of any statute of
limitations affecting any Guarantor’s liability hereunder; (d) any right
to proceed against any Loan Party, proceed against or exhaust any security or
other guaranty for the Obligations, or pursue any other remedy in the power of
any Guaranteed Party whatsoever; (e) any benefit of and any right to
participate in any security or other guaranty now or hereafter held by any
Guaranteed Party; and (f) to the fullest extent permitted by law, any and
all other defenses or benefits that may be derived from or afforded by
applicable law limiting the liability of or exonerating guarantors or
sureties.  Each Guarantor expressly
waives all setoffs and counterclaims and all presentments, demands for payment
or performance, notices of nonpayment or nonperformance, protests, notices of
protest, notices of dishonor and all other notices or demands of any kind or
nature whatsoever with respect to the Obligations, and all notices of
acceptance of this Guaranty or of the existence, creation or incurrence of new
or additional Obligations.

 

10.04       Obligations Independent.  The obligations of each Guarantor hereunder
are those of primary obligor, and not merely as surety, and are independent of
the Obligations and the obligations of any other guarantor, and a separate
action may be brought against any Guarantor to enforce this Guaranty whether or
not the Borrower or any other person or entity is joined as a party.

 

10.05       Subrogation.  No
Guarantor shall exercise any right of subrogation, contribution, indemnity,
reimbursement or similar rights with respect to any payments it makes under
this Guaranty until all of the Obligations (other than unasserted contingent
indemnification obligations) and any amounts payable under this Guaranty have
been indefeasibly paid and performed in full and the Commitments and the
Facilities are terminated.  If any
amounts are paid to any Guarantor in violation of the foregoing limitation, then
such amounts shall be held in trust for the benefit of the Guaranteed Parties
and shall forthwith be paid to the Administrative Agent for the benefit of the
Guaranteed Parties to reduce the amount of the Obligations, whether matured or
unmatured.

 

10.06       Termination; Reinstatement.  This Guaranty is a continuing and irrevocable
guaranty of all Obligations now or hereafter existing and shall remain in full
force and effect 

 

57

 

until
all Obligations and any other amounts payable under this Guaranty are
indefeasibly paid in full in cash and the Commitments and the Facilities with
respect to the Obligations are terminated. 
Notwithstanding the foregoing, this Guaranty shall continue in full
force and effect or be revived, as the case may be, if any payment by or on
behalf of the Borrower or any Guarantor is made, or any of the Guaranteed
Parties exercises its right of setoff, in respect of the Obligations and such
payment or the proceeds of such setoff or any part thereof is subsequently
invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by any of the Guaranteed
Parties in their discretion) to be repaid to a trustee, receiver or any other
party, in connection with any proceeding under any Debtor Relief Laws or
otherwise, all as if such payment had not been made or such setoff had not
occurred and whether or not the Guaranteed Parties are in possession of or have
released this Guaranty and regardless of any prior revocation, rescission,
termination or reduction.  The
obligations of each Guarantor under this paragraph shall survive termination of
this Guaranty.

 

10.07       Subordination. 
Each Guarantor hereby subordinates the payment of all obligations and
indebtedness of the Borrower or any other Loan Party owing to such Guarantor,
whether now existing or hereafter arising, including but not limited to any
obligation of any Loan Party to such Guarantor as subrogee of the Guaranteed
Parties or resulting from a Guarantor’s performance under this Guaranty, to the
indefeasible payment in full in cash of all Obligations.  If the Guaranteed Parties so request, any
such obligation or indebtedness of any Loan Party to a Guarantor shall be enforced
and performance received by such Guarantor as trustee for the Guaranteed
Parties and the proceeds thereof shall be paid over to the Agent for the
benefit of the Guaranteed Parties on account of the Obligations, but without
reducing or affecting in any manner the liability of any Guarantor under this
Guaranty.

 

10.08       Stay of Acceleration. 
If acceleration of the time for payment of any of the Obligations is
stayed, in connection with any case commenced by or against any Guarantor or
the Borrower under any Debtor Relief Laws, or otherwise, all such amounts shall
nonetheless be payable by the Guarantors immediately upon demand by the
Guaranteed Parties.

 

10.09       Condition of Borrower. 
Each Guarantor acknowledges and agrees that it has the sole
responsibility for, and has adequate means of, obtaining from the Borrower and
any other guarantor such information concerning the financial condition,
business and operations of the Borrower and any such other guarantor as such
Guarantor requires, and that none of the Guaranteed Parties has any duty, and
such Guarantor is not relying on the Guaranteed Parties at any time, to
disclose to such Guarantor any information relating to the business, operations
or financial condition of the Borrower or any other guarantor (such Guarantor
waiving any duty on the part of the Guaranteed Parties to disclose such
information and any defense relating to the failure to provide the same).

 

10.10       Rights of Contribution.

 

(a)           The Guarantors hereby agree, as between themselves, that
if any Guarantor shall become an Excess Funding Guarantor (as defined below) by
reason of the payment by such Guarantor of any Obligations, each other
Guarantor shall, on demand of such Excess Funding Guarantor (but subject to the
next sentence), pay to such Excess Funding 

 

58

 

Guarantor
an amount equal to such Guarantor’s Pro Rata Share (as defined below and
determined, for this purpose, without reference to the properties, debts and
liabilities of such Excess Funding Guarantor) of the Excess Payment (as defined
below) in respect of such Obligations. The payment obligation of a Guarantor to
any Excess Funding Guarantor under this Section shall be subordinate and
subject in right of payment to the prior payment in full of the obligations of
such Guarantor under the other provisions of this Article and of all other
Obligations, and such Excess Funding Guarantor shall not exercise any right or
remedy with respect to such excess until payment and satisfaction in full of
all of the Obligations.

 

(b)           For purposes of this Section, (i) “Excess Funding
Guarantor” means, in respect of any Obligations, a Guarantor that has paid
an amount in excess of its Pro Rata Share of such Obligations, (ii) “Excess
Payment” means, in respect of any Guaranteed Obligations, the amount paid
by an Excess Funding Guarantor in excess of its Pro Rata Share of such
Obligations and (iii) “Pro Rata Share” means, for any Guarantor,
the ratio (expressed as a percentage) of (x) the amount by which the
aggregate present fair saleable value of all properties of such Guarantor
(excluding any shares of stock of any other Guarantor) exceeds the amount of
all the debts and liabilities of such Guarantor (including contingent,
subordinated, unmatured and unliquidated liabilities, but excluding the
obligations of such Guarantor hereunder and any obligations of any other
Guarantor that have been guaranteed by such Guarantor) to (y) the amount
by which the aggregate fair saleable value of all properties of all of the
Guarantors exceeds the amount of all the debts and liabilities (including
contingent, subordinated, unmatured and unliquidated liabilities, but excluding
the obligations of the Guarantors hereunder and under the other Loan Documents)
of all of the Guarantors, determined (A) with respect to any Guarantor
that is a party hereto on the Closing Date, as of the Closing Date, and (B) with
respect to any other Guarantor, as of the date such Guarantor becomes a
Guarantor hereunder.

 

10.11       General Limitation on Guarantee Obligations.  In any action or proceeding involving any
state corporate law, or any state or Federal bankruptcy, insolvency,
reorganization or other law affecting the rights of creditors generally, if the
obligations of any Guarantor under Section 10.01 would otherwise, taking
into account the provisions of Section 10.10, be held or determined to be
void, invalid or unenforceable, or subordinated to the claims of any other
creditors, on account of the amount of its liability under Section 10.01,
then, notwithstanding any other provision hereof to the contrary, the amount of
such liability shall, without any further action by such Borrower, any Lender,
the Administrative Agent or any other Person, be automatically limited and
reduced to the highest amount that is valid and enforceable and not
subordinated to the claims of other creditors as determined in such action or
proceeding.

 

10.12       Joint and Several Obligations.  Each Guarantor hereby accepts joint and
several liability under the Loan Documents in consideration of the financial
accommodations to be provided by the Lenders and the Administrative Agent under
the Loan Documents, for the mutual benefit, directly and indirectly, of each
Guarantor and in consideration of the undertakings of the other Guarantors to
accept joint and several liability for the Obligations.  Each Guarantor represents and warrants to the
Administrative Agent and Lenders that such Guarantor is currently informed of
the financial condition of all the Loan Parties and of all other circumstances
which a diligent inquiry would reveal and which bear upon the risk of
nonpayment of the Obligations.  Each
Guarantor further represents and warrants to the 

 

59

 

Administrative
Agent and Lenders that such Guarantor has read and fully understands the terms
and conditions of the Loan Documents.

 

ARTICLE XI.        MISCELLANEOUS

 

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

 

(a)           waive any condition set forth in Section 4.01(a) without
the written consent of each Lender; provided, however, in the
sole discretion of Agent, only a waiver by Agent shall be required with respect
to immaterial matters or items specified in Section 4.01(a) (iii) or
(iv)  with respect to which Borrower has given assurances
satisfactory to Agent that such items shall be delivered promptly following the
Closing Date;

 

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

 

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

 

(d)           reduce the principal of, or the rate of interest specified
herein on, any Loan or (subject to clause (iv) of the second proviso to
this Section 11.01) any fees or other amounts payable hereunder or
under any other Loan Document, without the written consent of each Lender
directly affected thereby; provided, however, that only the
consent of the Required Lenders shall be necessary (i) to amend the
definition of “Default Rate” or to waive any obligation of Borrower to pay interest
at the Default Rate or (ii) to amend any financial covenant hereunder (or
any defined term used therein) even if the effect of such amendment would be to
reduce the rate of interest on any Loan to reduce any fee payable hereunder;

 

(e)           change Section 2.13 or Section 8.03
in a manner that would alter the pro rata sharing of payments required thereby
without the written consent of each Lender;

 

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

 

(g)  release any Guarantor from the Guaranty except in accordance
with the terms of any Loan Document, without the written consent of each
Lender;

 

60

 

and,
provided  further, that (i) no amendment, waiver or consent
shall, unless in writing and signed by Agent in addition to the Lenders
required above, affect the rights or duties of Agent under this Agreement or
any other Loan Document.  Notwithstanding
anything to the contrary herein, no Defaulting Lender shall have any right to
approve or disapprove any amendment, waiver or consent hereunder, except that
the Commitment of such Lender may not be increased or extended without the
consent of such Lender.

 

11.02       Notices; Effectiveness; Electronic Communications.

 

(a)           Notices  Generally.  Except in the case of notices and other
communications expressly permitted to be given by telephone (and except as
provided in subsection (b) below), all notices and other communications
provided for herein shall be in writing and shall be delivered by hand or overnight
courier service, mailed by certified or registered mail or sent by telecopier
as follows, and all notices and other communications expressly permitted
hereunder to be given by telephone shall be made to the applicable telephone
number, as follows:

 

(i)            if to any Loan Party or Agent to the address, telecopier
number, electronic mail address or telephone number specified for such Person
on Schedule 10.02 ; and

 

(ii)           if to any Lender, to the address, telecopier number,
electronic mail address or telephone number specified in its Administrative
Questionnaire.

 

Notices sent by hand
or overnight courier service, or mailed by certified or registered mail, shall
be deemed to have been given when received; notices sent by telecopier shall be
deemed to have been given when sent (except that, if not given during normal
business hours for the recipient, shall be deemed to have been given at the
opening of business on the next business day for the recipient).  Notices delivered through electronic
communications to the extent provided in subsection (b) below, shall be
effective as provided in such subsection (b).

 

(b)           Electronic Communications.  Notices and other communications to Lenders
hereunder may be delivered or furnished by electronic communication (including
e-mail and Internet or intranet websites) pursuant to procedures approved by
Agent, provided that the foregoing shall not apply to notices to any Lender
pursuant to Article II if such Lender has notified the Agent that
it is incapable of receiving notices under such Article by electronic
communication.  Agent or Borrower may, in
its discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it,
provided that approval of such procedures may be limited to particular notices
or communications.  Unless Agent
otherwise prescribes, (i) notices and other communications sent to an
e-mail address shall be deemed received upon the sender’s receipt of an
acknowledgement from the intended recipient (such as by the “return receipt
requested” function, as available, return e-mail or other written
acknowledgement), provided that if such notice or other communication is
not sent during the normal business hours of the recipient, such notice or communication
shall be deemed to have been sent at the opening of business on the next
business day for the recipient, and (ii) notices or communications posted
to an Internet or intranet website shall be deemed received upon the deemed
receipt by the intended recipient at its e-mail 

 

61

 

address
as described in the foregoing clause (i) of notification that such
notice or communication is available and identifying the website address
therefor.

 

(c)           The Platform. 
THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.”  THE AGENT PARTIES (AS DEFINED BELOW) DO NOT
WARRANT THE ACCURACY OR COMPLETENESS OF BORROWER MATERIALS OR THE ADEQUACY OF
THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM
BORROWER MATERIALS.  NO WARRANTY OF ANY
KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR
FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN
CONNECTION WITH BORROWER MATERIALS OR THE PLATFORM.  In no event shall Agent or any of its Related
Parties (collectively, the “Agent Parties”) have any liability to
Borrower, any Lender or any other Person for losses, claims, damages, liabilities
or expenses of any kind (whether in tort, contract or otherwise) arising out of
any Loan Party’s or Agent’s transmission of Borrower Materials through the
Internet, except to the extent that such losses, claims, damages, liabilities
or expenses are determined by a court of competent jurisdiction by a final and
nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Agent Party; provided, however, that in no event
shall any Agent Party have any liability to Borrower, any Lender or any other
Person for indirect, special, incidental, consequential or punitive damages (as
opposed to direct or actual damages).

 

(d)           Change of Address, Etc.  Each of Borrower, any other Loan Party and
Agent may change its address, telecopier or telephone number for notices and
other communications hereunder by notice to the other parties hereto.  Each Lender may change its address,
telecopier or telephone number for notices and other communications hereunder
by notice to Borrower and Agent.  In
addition, each Lender agrees to notify Agent from time to time to ensure that
Agent has on record (i) an effective address, contact name, telephone
number, telecopier number and electronic mail address to which notices and
other communications may be sent and (ii) accurate wire instructions for
such Lender.  Furthermore, each Public
Lender agrees to cause at least one individual at or on behalf of such Public
Lender to at all times have selected the “Private Side Information” or similar
designation on the content declaration screen of the Platform in order to
enable such Public Lender or its delegate, in accordance with such Public
Lender’s compliance procedures and applicable Law, including United States
Federal and state securities Laws, to make reference to Borrower Materials that
are not made available through the “Public Side Information” portion of the
Platform and that may contain material non-public information with respect to
the Borrower or its securities for purposes of United States Federal or state
securities laws.

 

(e)           Reliance by Agent and Lenders.  Agent
and Lenders shall be entitled to rely and act upon any notices (including
telephonic Committed Loan Notices) purportedly given by or on behalf of
Borrower or any other Loan Party even if (i) such notices were not made in
a manner specified herein, were incomplete or were not preceded or followed by
any other form of notice specified herein, or (ii) the terms thereof, as
understood by the recipient, varied from any confirmation thereof.  Borrower shall indemnify Agent, each Lender
and the Related Parties of 

 

62

 

each
of them from all losses, costs, expenses and liabilities resulting from the
reliance by such Person on each notice purportedly given by or on behalf of any
Loan Party.  All telephonic notices to
and other telephonic communications with Agent may be recorded by Agent, and
each of the parties hereto hereby consents to such recording.

 

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

 

11.04       Expenses; Indemnity; Damage Waiver.

 

(a)           Costs and Expenses. 
Borrower shall pay (i) all reasonable out-of-pocket expenses
incurred by Agent and its Affiliates (including the reasonable fees, charges
and disbursements of counsel for Agent), in connection with the syndication of
the credit facilities provided for herein, the preparation, negotiation,
execution, delivery and administration of this Agreement and the other Loan
Documents or any amendments, modifications or waivers of the provisions hereof
or thereof (whether or not the transactions contemplated hereby or thereby
shall be consummated), and (ii) all out-of-pocket expenses incurred by
Agent or any Lender (including the fees, charges and disbursements of any
counsel for Agent or any Lender), and shall pay all fees and time charges for
attorneys who may be employees of Agent or any Lender, in connection with the
enforcement or protection of its rights (A) in connection with this
Agreement and the other Loan Documents, including its rights under this
Section, or (B) in connection with the Loans made hereunder, including all
such out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans.

 

(b)           Indemnification by Borrower.  Borrower shall indemnify Agent (and any
sub-agent thereof), each Lender, and each Related Party of any of the foregoing
Persons (each such Person being called an “Indemnitee”) against, and
hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities
and related expenses (including the fees, charges and disbursements of any
counsel for any Indemnitee), and
shall indemnify and hold harmless each Indemnitee from all fees and time
charges and disbursements for attorneys who may be employees of any Indemnitee,
incurred by any Indemnitee or asserted against any Indemnitee by any third
party or by Borrower or any other Loan Party arising out of, in connection
with, or as a result of (i) the execution or delivery of this Agreement,
any other Loan Document or any agreement or instrument contemplated hereby or
thereby, the performance by the parties hereto of their respective obligations
hereunder or thereunder, or the consummation of the transactions contemplated
hereby or thereby, or, in the case of Agent (and any sub-agent thereof) and its
Related Parties only, the administration of this Agreement and the other Loan
Documents, (ii) any Loan or the use or proposed use of the proceeds
therefrom, (iii) any actual or alleged presence or release of Hazardous
Materials on or from any property owned or operated by Borrower or any of its
Subsidiaries, or any Environmental Liability related in any way to Borrower or
any of its Subsidiaries, or (iv) any actual or prospective claim,
litigation,

 

63

 

investigation
or proceeding relating to any of the foregoing, whether based on contract, tort
or any other theory, whether brought by a third party or by Borrower or any
other Loan Party, and regardless of whether any Indemnitee is a party thereto IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN WHOLE OR IN PART,
OUT OF THE COMPARATIVE, CONTRIBUTORY OR SOLE NEGLIGENCE OF THE INDEMNITEE;
provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, liabilities or
related expenses (x) are determined by a court of competent jurisdiction
by final and nonappealable judgment to have resulted from the gross negligence
or willful misconduct of such Indemnitee or (y) result from a claim
brought by Borrower or any other Loan Party against an Indemnitee for breach in
bad faith of such Indemnitee’s obligations hereunder or under any other Loan
Document, if Borrower or such Loan Party has obtained a final and nonappealable
judgment in its favor on such claim as determined by a court of competent
jurisdiction.

 

(c)           Reimbursement by Lenders.  To the extent that Borrower for any reason
fails to indefeasibly pay any amount required under subsection (a) or (b) of
this Section to be paid by it to Agent (or any sub-agent thereof) or any
Related Party of any of the foregoing, each Lender severally agrees to pay to
Agent (or any such sub-agent) or such Related Party, as the case may be, such
Lender’s Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount, provided
that the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by or asserted against Agent
(or any such sub-agent) in its capacity as such, or against any Related Party
of any of the foregoing acting for Agent (or any such sub-agent) in connection
with such capacity.  The obligations of
the Lenders under this subsection (c) are subject to the provisions of
Section 2.12(d).

 

(d)           Waiver of Consequential Damages, Etc.  To the fullest extent permitted by applicable
law, no Loan Party shall assert, and each Loan Party hereby waives, any claim
against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement, any
other Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or the use of the
proceeds thereof.  No Indemnitee referred
to in subsection (b) above shall be liable for any damages arising from
the use by unintended recipients of any information or other materials
distributed to such unintended recipients by such Indemnitee through
telecommunications, electronic or other information transmission systems in
connection with this Agreement or the other Loan Documents or the transactions
contemplated hereby or thereby other than for direct or actual damages
resulting from the gross negligence or willful misconduct of such Indemnitee as
determined by a final and nonappealable judgment of a court of competent
jurisdiction.

 

(e)           Payments. 
All amounts due under this Section shall be payable not later than
ten Business Days after demand therefor.

 

(f)            Survival. 
The agreements in this Section shall survive the resignation of
Agent, the replacement of any Lender, the termination of the Aggregate
Commitments and the repayment, satisfaction or discharge of all the other
Obligations.

 

64

 

11.05       Payments Set Aside. 
To the extent that any payment by or on behalf of Borrower is made to
Agent or any Lender, or Agent, or any Lender exercises its right of setoff, and
such payment or the proceeds of such setoff or any part thereof is subsequently
invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by Agent or such Lender in
its discretion) to be repaid to a trustee, receiver or any other party, in
connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to
the extent of such recovery, the obligation or part thereof originally intended
to be satisfied shall be revived and continued in full force and effect as if
such payment had not been made or such setoff had not occurred, and (b) each
Lender severally agrees to pay to Agent upon demand its applicable share
(without duplication) of any amount so recovered from or repaid by Agent, plus
interest thereon from the date of such demand to the date such payment is made
at a rate per annum equal to the Federal Funds Rate from time to time in
effect.  The obligations of the Lenders
under clause (b) of the preceding sentence shall survive the payment in
full of the Obligations and the termination of this Agreement.

 

11.06       Successors and Assigns.

 

(a)           Successors and Assigns Generally.  The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that neither
Borrower nor any other Loan Party may assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of Agent and
each Lender and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an assignee in accordance with the
provisions of subsection (b) of this Section, (ii) by way of
participation in accordance with the provisions of subsection (d) of this
Section, or (iii) by way of pledge or assignment of a security interest
subject to the restrictions of subsection (f)  of this Section (and
any other attempted assignment or transfer by any party hereto shall be null
and void).  Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in subsection (d) of this Section and,
to the extent expressly contemplated hereby, the Related Parties of each of
Agent and the Lenders) any legal or equitable right, remedy or claim under or
by reason of this Agreement.

 

(b)           Assignments by Lenders.  Any Lender may at any time assign to one or
more assignees all or a portion of its rights and obligations under this
Agreement (including all or a portion of its Commitments and the Loans at the
time owing to it); provided that any such assignment shall be subject to
the following conditions:

 

(i)            Minimum Amounts

 

(A)  in the case of an assignment of the entire remaining amount
of the assigning Lender’s Commitment under any Facility and the Loans at the
time owing to it  under such Facility  or in the case of an assignment to a Lender or an Affiliate
of a Lender no minimum amount need be assigned; and

 

65

 

(B) in any case not described in subsection (b)(i)(A) of this
Section,  the aggregate amount of the
Commitment (which for this purpose includes Loans outstanding thereunder) or,
if the Commitment is not then in effect, the principal outstanding balance of
the Loans of the assigning Lender subject to each such assignment, determined
as of the date the Assignment and Assumption with respect to such assignment is
delivered to Agent or, if “Trade Date” is specified in the Assignment and
Assumption, as of the Trade Date, shall not be less than $5,000,000, in the case of any assignment in respect of the Revolving
Credit Facility, or $1,000,000, in the case of any assignment in respect of the
Term Facility  unless each of Agent and, so long
as no Event of Default has occurred and is continuing, Borrower otherwise
consents (each such consent not to be unreasonably withheld or delayed);
provided, however, that concurrent assignments to members of an Assignee Group
and concurrent assignments from members of an Assignee Group to a single
Eligible Assignee (or to an Eligible Assignee and members of its Assignee
Group) will be treated as a single assignment for purposes of determining
whether such minimum amount has been met;

 

(ii)           Proportionate Amounts.  Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and
obligations under this Agreement with respect to the Loans or the Commitment
assigned, except that this clause (ii) shall not  prohibit
any Lender from assigning all or a portion of its rights and obligations among
separate Facilities on a non-pro rata basis;

 

(iii)          Required Consents. 
No consent shall be required for any assignment except to the extent
required by subsection (b)(i)(B) of this Section and, in addition:

 

(A)          the consent of Borrower (such consent not to be
unreasonably withheld or delayed) shall be required unless (1) an Event of
Default has occurred and is continuing at the time of such assignment or (2) such
assignment is to a Lender or an Affiliate of a Lender; and

 

(B)           the consent of Agent (such consent not to be unreasonably
withheld or delayed) shall be required  for
assignments in respect of (1) any Term Commitment or Revolving Credit
Commitment if such assignment is to a Person that is not a Lender with a
Commitment in respect of the applicable Facility, or an Affiliate of such
Lender or (2) any Term Loan to a Person that is not a Lender; or an
Affiliate of a Lender.

 

(iv)          Assignment and Assumption. The parties to each
assignment shall execute and deliver to Agent an Assignment and Assumption,
together with a processing and recordation fee in the amount of $3,500.00;
provided, however, that the Agent may, in its sole discretion, elect to waive
such processing and recordation fee in the case of any assignment. The
assignee, if it is not a Lender, shall deliver to Agent an Administrative
Questionnaire.

 

66

 

(v)           No Assignment to Borrower.  No such assignment shall be made to Borrower
or any of Borrower’s Affiliates or Subsidiaries.

 

(vi)          No Assignment to Natural Persons.  No such assignment shall be made to a natural
person.

 

Subject to acceptance and recording thereof by Agent pursuant to
subsection (c) of this Section, from and after the effective date
specified in each Assignment and Assumption, the assignee thereunder shall be a
party to this Agreement and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender’s rights and obligations under
this Agreement, such Lender shall cease to be a party hereto) but shall
continue to be entitled to the benefits of Sections 3.01, 3.04, 3.05,  and 10.04 with respect to facts and
circumstances occurring prior to the effective date of such assignment.  Upon request, Borrower (at its expense) shall
execute and deliver a Note to the assignee Lender.  Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
subsection shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
subsection (d) of this Section.

 

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

 

(d)           Participations. 
Any Lender may at any time, without the consent of, or notice to,
Borrower or Agent, sell participations to any Person (other than a natural person
or Borrower or any of Borrower’s Affiliates or Subsidiaries) (each, a “Participant”)
in all or a portion of such Lender’s rights and/or obligations under this
Agreement (including all or a portion of its Commitment and/or the Loans owing
to it); provided that (i) such Lender’s obligations under this
Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (iii) Borrower, Agent and the Lenders shall continue to deal solely
and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.  Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any provision
of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant,
agree to any amendment, waiver or other modification described in the first
proviso to Section 11.01 that affects such Participant. 

 

67

 

Subject
to subsection (e) of this Section, Borrower agrees that each Participant
shall be entitled to the benefits of Sections 3.01, 3.04 and 3.05  to the same extent as if it were a Lender
and had acquired its interest by assignment pursuant to subsection (b) of
this Section.  To the extent permitted by
law, each Participant also shall be entitled to the benefits of Section 11.08  as though it were a Lender, provided
such Participant agrees to be subject to Section 2.13 as though it
were a Lender.

 

(e)           Limitations upon Participant Rights.  A Participant shall not be entitled to
receive any greater payment under Section 3.01 or 3.04  than the applicable Lender would have
been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is made
with Borrower’s prior written consent.

 

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

 

(g)           Electronic Execution of Assignments.  The words “execution,” “signed,” “signature,”
and words of like import in any Assignment and Assumption shall be deemed to
include electronic signatures or the keeping of records in electronic form,
each of which shall be of the same legal effect, validity or enforceability as
a manually executed signature or the use of a paper-based recordkeeping system,
as the case may be, to the extent and as provided for in any applicable law,
including the Federal Electronic Signatures in Global and National Commerce
Act, the New York State Electronic Signatures and Records Act, or any other
similar state laws based on the Uniform Electronic Transactions Act.

 

(h)           Deemed Consent of Borrower.  If the consent of Borrower to an assignment
to an Eligible Assignee is required hereunder (including a consent to an
assignment which does not meet the minimum assignment threshold specified in Section 11.06(b)(i)(B)),
Borrower shall be deemed to have given its consent five Business Days after the
date notice thereof has been delivered to Borrower by the assigning Lender
(through Agent) unless such consent is expressly refused by Borrower prior to
such fifth Business Day.

 

11.07       Treatment of Certain Information; Confidentiality.  Each of Agent and the Lenders agrees to
maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its Affiliates and to its and its
Affiliates’ respective partners, directors, officers, employees, agents,
advisors and representatives (it being understood that the Persons to whom such
disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to
the extent requested by any regulatory authority, purporting to have
jurisdiction over it (including any self-regulatory authority, such as the
National Association of Insurance Commissioners), (c) to the extent
required by applicable laws or regulations or by any subpoena or similar legal
process, (d) to any other party hereto, (e) in connection with the
exercise of any remedies hereunder or under any other Loan Document or any
action or proceeding relating to this Agreement or any other Loan 

 

68

 

Document
or the enforcement of rights hereunder or thereunder, (f) subject to an
agreement containing provisions substantially the same as those of this
Section, to (i) any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this
Agreement, or (ii) any actual or prospective counterparty (or its
advisors) to any swap or derivative transaction relating to Borrower and its
obligations, (g) with the consent of Borrower or (h) to the extent
such Information (x) becomes publicly available other than as a result of
a breach of this Section or (y) becomes available to Agent, any
Lender or any of their respective Affiliates on a nonconfidential basis from a
source other than Borrower.  For purposes
of this Section, “Information” means all information received from
Borrower or any Subsidiary relating to Borrower or any Subsidiary or any of
their respective businesses, other than any such information that is available
to Agent or any Lender on a nonconfidential basis prior to disclosure by
Borrower or any Subsidiary, provided that, in the case of information
received from Borrower or any Subsidiary after the date hereof, such
information is clearly identified at the time of delivery as confidential.  The parties hereto agree that financial
statements of Borrower that are not available to Agent or any Lender on a
nonconfidential basis prior to disclosure by Borrower or any Subsidiary shall
be deemed confidential.  Any Person
required to maintain the confidentiality of Information as provided in this Section shall
be considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential
information.  Each of Agent and the
Lenders acknowledges that (a) the Information may include material
non-public information concerning Borrower or a Subsidiary, as the case may be,
(b) it has developed compliance procedures regarding the use of material
non-public information and (c) it will handle such material non-public
information in accordance with applicable Law, including Federal and state
securities Laws.

 

11.08       Right of Setoff. 
If an Event of Default shall have occurred and be continuing, each
Lender and each of their respective Affiliates is hereby authorized at any time
and from time to time, to the fullest extent permitted by applicable law, to
set off and apply any and all deposits (general or special, time or demand,
provisional or final, in whatever currency, but excluding accounts used
exclusively for payroll or customer escrows and trust accounts) at any time
held and other obligations (in whatever currency) at any time owing by such
Lender or any such Affiliate to or for the credit or the account of Borrower or
any other Loan Party against any and all of the obligations of Borrower or such
Loan Party now or hereafter existing under this Agreement or any other Loan
Document to such Lender or any such Affiliate, irrespective of whether or not
such Lender shall have made any demand under this Agreement or any other Loan
Document and although such obligations of Borrower or such Loan Party may be
contingent or unmatured or are owed to a branch or office of such Lender different
from the branch or office holding such deposit or obligated on such
indebtedness.  The rights of each Lender
and their respective Affiliates under this Section are in addition to
other rights and remedies (including other rights of setoff) that such Lender
or its Affiliates may have.  Each Lender
agrees to notify Borrower and Agent promptly after any such setoff and
application, provided that the failure to give such notice shall not
affect the validity of such setoff and application.

 

11.09       Interest Rate Limitation.  Notwithstanding anything to the contrary
contained in any Loan Document, the interest paid or agreed to be paid under
the Loan Documents shall not 

 

69

 

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

 

11.10       Counterparts; Integration; Effectiveness.  This Agreement may be executed in
counterparts (and by different parties hereto in different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract.  This
Agreement and the other Loan Documents constitute the entire contract among the
parties relating to the subject matter hereof and supersede any and all
previous agreements and understandings, oral or written, relating to the
subject matter hereof.  Except as
provided in Section 4.01, this Agreement shall become effective
when it shall have been executed by Agent and when Agent shall have received
counterparts hereof that, when taken together, bear the signatures of each of
the other parties hereto.  Delivery of an
executed counterpart of a signature page of this Agreement by telecopy
shall be effective as delivery of a manually executed counterpart of this
Agreement.

 

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

 

11.12       Severability.  If any provision of this Agreement or the
other Loan Documents is held to be illegal, invalid or unenforceable, (a) the
legality, validity and enforceability of the remaining provisions of this
Agreement and the other Loan Documents shall not be affected or impaired
thereby and (b) the parties shall endeavor in good faith negotiations to
replace the illegal, invalid or unenforceable provisions with valid provisions
the economic effect of which comes as close as possible to that of the illegal,
invalid or unenforceable provisions.  The
invalidity of a provision in a particular jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

 

11.13       Governing Law; Jurisdiction; Etc.

 

(a)           GOVERNING LAW. 
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAW OF THE COMMONWEALTH OF MASSACHUSETTS.

 

70

 

(b)           SUBMISSION TO JURISDICTION.  BORROWER AND EACH OTHER LOAN PARTY
IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE
NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE COMMONWEALTH OF MASSACHUSETTS SITTING IN SUFFOLK COUNTY AND OF THE UNITED
STATES DISTRICT COURT OF THE DISTRICT
OF MASSACHUSETTS, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF
THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN
RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN
SUCH MASSACHUSETTS STATE COURT
OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL
COURT.  EACH OF THE PARTIES HERETO AGREES
THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE
ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER
PROVIDED BY LAW.  NOTHING IN THIS
AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT AGENT OR
ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING
TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST BORROWER OR ANY OTHER LOAN
PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

 

(c)           WAIVER OF VENUE. 
BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT
IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS
SECTION.  EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE
DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT.

 

(d)           SERVICE OF PROCESS. 
EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE
MANNER PROVIDED FOR NOTICES IN SECTION 11.02.  NOTHING IN THIS AGREEMENT WILL AFFECT THE
RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
APPLICABLE LAW.

 

11.14       WAIVER OF JURY TRIAL. 
EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO 

 

71

 

REPRESENTATIVE,
AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE
THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES
HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.

 

11.15       No Advisory or
Fiduciary Responsibility.  In connection with all aspects of
each transaction contemplated hereby (including in connection with any
amendment, waiver or other modification hereof or of any other Loan
Document),  Borrower and each other Loan
Party acknowledges and agrees and acknowledges its Affiliates’ understanding
that that:  (i) (A)  the
services regarding this Agreement provided by Agent are arm’s-length commercial
transactions between Borrower, each other Loan Party and their respective
Affiliates, on the one hand, and Agent, on the other hand, (B) each of
Borrower and the other Loan Parties have consulted their own legal, accounting,
regulatory and tax advisors to the extent they have deemed appropriate, and (C) 
Borrower and each other Loan Party is capable of evaluating and understanding,
and understands and accepts, the terms, risks and conditions of the
transactions contemplated hereby and by the other Loan Documents; (ii) (A) 
Agent is and has been acting solely as a principal and,  except as expressly agreed in writing by the
relevant parties, has not been, is not, and will not be acting as an advisor,
agent or fiduciary, for Borrower, any other Loan Party, or any of their
respective Affiliates, or any other Person and (B) Agent does not have any
obligation to Borrower, any other Loan Party or any of their Affiliates with
respect to the transaction contemplated hereby except those obligations
expressly set forth herein and in the other Loan Documents; and (iii) 
Agent and its Affiliates may be engaged in a broad range of transactions that
involve interests that differ from those of Borrower, the other Loan Parties
and their respective Affiliates, and Agent has no obligation to disclose any of
such interests to Borrower, any other Loan Party of any of their respective
Affiliates.  To the fullest extent
permitted by law, each of Borrower and the other Loan Parties hereby waive and
release,  any claims that it may have
against Agent with respect to any breach or alleged breach of agency or
fiduciary duty in connection with any aspect of any transaction contemplated
hereby.

 

11.16       USA Patriot Act Notice.  Each Lender that is subject to the Act (as
hereinafter defined) and Agent (for itself and not on behalf of any Lender)
hereby notifies each Loan Party that pursuant to the requirements of the USA
PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Act”), it is required to obtain, verify and record information
that identifies such Loan Party, which information includes the name and
address of such Loan Party and other information that will allow such Lender or
Agent, as applicable, to identify such Loan Party in accordance with the Act.

 

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

 

72

 

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

 

	
   

  	
  ANIKA THERAPEUTICS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kevin W. Quinlan

  
	
   

  	
   

  
	
   

  	
  Name: 

  	
  Kevin Quinlan

  
	
   

  	
   

  
	
   

  	
  Title: 

  	
  Chief
  Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ANIKA SECURITIES, INC.

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Kevin W. Quinlan

  
	
   

  	
   

  
	
   

  	
  Name: 

  	
  Kevin Quinlan

  
	
   

  	
   

  
	
   

  	
  Title: 

  	
  Chief
  Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A., as
  Administrative

  Agent

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Jean S. Manthorne

  
	
   

  	
   

  
	
   

  	
  Name: 

  	
  Jean S. Manthorne

  
	
   

  	
   

  
	
   

  	
  Title: 

  	
  Senior
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A., as a
  Lender

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Jean
  S. Manthorne

  
	
   

  	
   

  
	
   

  	
  Name: 

  	
  Jean S.
  Manthorne

  
	
   

  	
   

  
	
   

  	
  Title: 

  	
  Senior
  Vice President

  
								

 

[Signature Page to Credit Agreement]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00136-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00136-of-00352.parquet"}]]